Does having a virtual office in a TEA qualify as a physical presence for EB-5?

No. This is no different than using a corporate mailing address, but everybody is dispersed. It is hard to argue the JCE is headquartered there and the employees are there. Even in the most generous interpretation you could not daisy chain to get there.

I have not heard of any virtual offices being approved.

I doubt the USCIS would accept a virtual office; otherwise, everyone would open such an office. The jobs must be primarily located in the TEA.

You have to make the argument and show by a preponderance of the evidence that the NCE is principally doing business in a TEA. The USCIS Policy Manual states that "a new commercial enterprise is principally doing business in the location where it regularly, systematically, and continuously provides goods or services that support job creation. If the new commercial enterprise provides such goods or services in more than one location, it will be principally doing business in the location most significantly related to the job creation. Factors considered in determining where a new commercial enterprise is principally doing business include, but are not limited to, the location of: Any jobs directly created by the new commercial enterprise; any expenditure of capital related to the creation of jobs; The new commercial enterprises day-to-day operation; and the new commercial enterprise?s assets used in the creation of jobs."

I do not believe the USCIS/IPO is up on the virtual office/work from home arrangements. A business must be principally doing business in a TEA in order to qualify for the reduced investment. This means your workers must be in a TEA. Discuss with your attorney to determine how to proceed but perhaps locate your virtual office in the area near your workers; and once COVID is done with, rent an office in the same place that is sufficient to house all of your employees. USCIS will look for such a lease. And remember, you have to establish eligibility at the time of filing (so getting a sufficient office post; fact may be an issue but this might a risk you are willing to take given the lengthy processing times, COVID etc). Make sure you get advice from your attorney.

They normally require a physical office. An address where they can send correspondence; refer applicants to a labor case; etc. Why not rent some shared office space inside the TEA? Then you can say that the employees work out of that office.

The purpose of the TEA is to provide jobs there, not somewhere else. So no, it will not be approved.