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What kind of limitations exist on direct investments for EB-5?

I am willing to invest $1 million in my own business, not fund one run by somebody else. How can I make that investment into a franchise? Can I diversify my investment into two or three businesses?

Answers

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    A Olusanjo Omoniyi

    Immigration Attorney
    Answered on

    The main limitations on EB-5 direct investments as an investor are: The investor must live near the business(es) and are required to manage the business(es) on a day-to-day basis. An investment of $1 million is more than adequate for a direct investment. It will require a lot of planning before it can be feasible. However, an outright creation of a franchise as someone making an initial entry into the U.S. will almost be impossible unless you have advanced planning in place. After you have started your business, it can be nurtured and grown into a franchise if all state and federal laws are followed. There is nothing wrong in diversifying investment into two or three businesses, but they tend to work better under the EB-5 process if a holding company is created to coordinate the two or three businesses under a single corporate entity. Advisably, consult an EB-5 attorney on all the nuances of your plan prior to proceeding any further.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    A franchise may be a good vehicle for direct EB-5 investment and separate franchises must be owned by a single parent holding company as wholly owned subsidiaries to qualify. Engage the services of an experienced EB-5 immigration attorney.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    Franchises can be effective vehicles for direct EB-5 investments. You can invest in more than one business as long as the entities are wholly owned by your new commercial enterprise, which can be a holding company. It is important to do a significant amount of due diligence prior to making the decision to invest in a direct EB-5 franchise. An immigration attorney and a financial advisor can be important parts of your due-diligence team to advise you on what will work best for your situation.

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    Daniel A Zeft

    Immigration Attorney
    Answered on

    As a first step, you need legal advice concerning how you can make your investment into a viable direct EB-5 case.

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    Dale Schwartz

    Immigration Attorney
    Answered on

    You can probably do what you want to do regarding an EB-5 case. But be sure you gave an experienced EB-5 lawyer advising you at all stages.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    This can work if structured correctly. You need to make sure that any branch offices are wholly owned subsidiaries. It is very important to structure the business correctly.

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    Lynne Feldman

    Immigration Attorney
    Answered on

    The investment would need to be into a project which can be defined broadly, especially if in the same geographic area.

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    Marisa Casablanca

    Immigration Attorney
    Answered on

    I have experience in direct EB-5 investment and diversifying them into different businesses. Many EB-5 attorneys handle regional center application for EB-5, but I have experience in EB-5 direct investments also.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    Yes, you can direct invest in a franchise to qualify for EB-5 processing, as long as you meet the other requirements (i.e., minimum capital invested, minimum job creation, lawful source of funds). One of the requirements for EB-5 is that the minimum capital invested be in the requisite job-creating entity, so you will not be able to diversify the investment into multiple businesses unless you create an entity that would own the multiple businesses, and you invest the money in that entity and it is that entity that also creates the jobs, etc.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    Franchises have been popular with direct EB-5, and it may be possible to combine businesses if everything is structured properly. So, finding an immigration attorney will be essential.

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    Vaughan de Kirby

    Immigration Attorney
    Answered on

    The key question is whether the business you create generates 10 full-time jobs. Yes, this can be a franchise. Yes, you can diversify. Some individuals invest in two or more units of a franchise. Your questions are all excellent and would be best answered by an experienced investment immigration attorney.

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    Charles Foster

    Immigration Attorney
    Answered on

    You may make your $1-million investment in your own investment; that is called a direct investment. With such investment you may acquire a franchise or multiple franchises. However, if the $1 million is used to acquire multiple franchises, you should invest in a single entity that will own and operate the multiple franchises.

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