Brazilian family invests in EB-5 for the future of their children

By EB5 Investors Magazine Staff

As a tenured professor at a well-regarded public university, 44-year-old Erika Nogueira de Andrade Stupiello never planned on leaving Brazil — but thanks to her son Bruno’s love of airplanes, she’s now reconsidering her options.

After the 15-year-old set his heart on a career in aviation, it became clear he would need to study in the U.S. in order to achieve his dreams. That’s why last April, Stupiello and her husband, an ethanol industry executive, invested $500,000 in the Surf Club Four Seasons Hotel & Residences development in Miami Beach, and filed the paperwork to begin an EB-5 application.

“We’re doing this for him,” Stupiello says. “It’s like giving him his inheritance ahead of time.”

Bruno is already in Florida, completing high school on an F1 visa, Stupiello explains.

Getting a green card will allow him to win scholarships, attend college in the U.S., and perhaps one day join the US Air Force. It also means Stupiello won’t have to fret about him leaving their home in São José do Rio Preto, a peaceful provincial city, to study in one of Brazil's more dangerous major cities.

“He’ll be able to study in a good city and be safe, instead of studying in a big city in Brazil, where I’d be very worried about violence,” Stupiello explains.

Such stories are increasingly common in Brazil, where awareness of the EB-5 program has increased sharply in recent years. Between 1990 and 2007, only 14 Brazilian investors received EB-5 visas, according to an IIUSA report. Now, however, Brazil is the world’s fifth-largest source of EB-5 investors, and the biggest contributor outside southeast Asia.

In fiscal 2016 alone, Brazilians poured $79 million into EB-5 projects, and received 150 visas, according to State Department data, a more than fourfold increase than the previous year.

“In 2012, the most common question I’d get was ’Is this legal?’” says Renata Castro, managing partner at Castro Legal Group in Pompano Beach, Florida. “They thought it was some kind of scheme.” But recently the EB-5 program has gained much wider recognition. “Now, I’m getting more sophisticated questions about the structure, the jobs created, and the likelihood of getting a permanent green card,” she says. “Brazil is becoming a much more mature market.”

The upsurge in EB-5 activity is the product of Brazil’s economic boom and bust, says Luciana Zamith Fischer, a Miami immigration lawyer and former regional center principal. In 2010, Brazil’s economy surged 7.5 percent, the highest rate since the mid-1980s, but growth has slipped steadily since then, and in both 2015 and 2016 the economy contracted by more than 3.5 percent.

That means many Brazilians who got rich during the good years are now seeing their country dragged down by an economic crisis, political scandals and rising crime, Zamith Fischer says. As a result, large numbers of Brazilians have both the resources and the motivation to use the EB-5 program. “People feel the prosperity from 2010 should have translated to better services and infrastructure,” she says. “People are disillusioned, and they want to get out.”

Around 8,000 millionaires left Brazil in 2016, the third-highest outflow worldwide, according to a New World Wealth report, with Sao Paolo alone losing more than 3,000 millionaires.

The trend seem to continue that wealthy Brazilians are turning to the EB-5 program: a total of 151 Brazilians filed EB-5 applications in fiscal 2016, according to data obtained by IIUSA.

Not all of those applications will ultimately be approved: Brazilian I-526 filings were rejected at a slightly higher rate than the global average in fiscal 2016, with just under three quarters of applicants granted visas.

Because of that wariness, many Brazilians favor relatively small, bricks-and-mortar projects, where they can more easily keep tabs on things. About 80 percent of LCR Capital’s Brazilian investors opt for real-estate development projects, like the Surf Club investment favored by the Stupiello famiy.

For now, Stupiello says she and her husband are happy to remain in their relatively peaceful corner of Brazil and let their son Bruno reap the rewards of their EB-5 investment.

Still, Stupiello says, she’s paying close attention to Brazil’s economic and political problems and will be relieved to have the option of coming to America in the future.

“We feel lucky,” she says. “We know that we’ll have a choice. If we want, in our retirement, we’ll have a chance to go to a quieter place and be close to our son.”