Finding and Selling EB5 Investors

EB-5 Candidate

Thank you for your interest in our services. You may be a candidate for our group. We are active in various projects and currently closing a few. Please forward your BP. After a simple review of your business plan or summary, we will consider your project for viability.

EB-5 is becoming a Mainstream Source of Project Financing in the US.

The EB-5 program presents a relatively inexpensive, non-recourse financing option for developers, who can offer returns of less than 4% (some cases higher), to an investor, who is more interested in obtaining a green card than high return on their investment. The typical term of an EB-5 loan to a developer is five years, although a one or two year extension may be possible.

What is it:

The EB-5 visa program, administered by the U.S. Citizenship and Immigration Service (USCIS), which allows foreign investors willing to invest at least $500,000 or $1 million in a new commercial enterprise that creates at least 10 full-time, permanent jobs for U.S. workers, to qualify for a green card, was created by Congress in 1990

Typical Loan Structure:

EB-5 funding provides a number of benefits. First, funding can be in the form of debt or equity, and can occupy different portions of the capital stack. EB-5 funding frequently serves to bridge the gap between developer equity and the loan-to-cost requirements of many commercial lenders, and is often used as mezzanine financing. EB-5 funds can be secured by a first lien, second lien, mezzanine pledge, or other collateral and it may be in the form of recourse or non-recourse debt. Typically the funds (non recourse) are pooled via a Limited Partnership and loaned to the operating company.

Requirements:

10 jobs created within 2 years per 500K TEA (some instances $1M) investor mandatory:

In order to create enough jobs to meet the ten-jobs-per-investor requirement (three times counted if using Regional Center), there must be additional sources of funding for a project. Investors also want to see that a developer has some of its own equity at risk in a project, and frequently also like to see some amount of bank debt, as a sign that a project has been underwritten. A typical project funded with EB-5 money will have between 30% and 60% EB 5 funding, and a mix of developer equity and debt filling in the rest of the stack.

Most important questions:

“How do investors find EB-5 projects? “Do EB-5 attorneys look for projects for their potential EB-5 investor? If so, how does one go about it? I have a few projects that need to be funded. Real estate management Co, Development Company, food manufacturing, online consumer retail store, national call center, and financial lending”

Most Important Answer:

Someone has to sell the project to investors;. This is a task of our group and our migration agents, not for EB-5 attorneys. Countries such as China and Korea have many established migration agents that can tap into the market for investors. If you are planning on having a regional center sponsor your project, then some regional centers (not many) have established networks through which your project can be introduced to investors. There is also a growing demand for direct EB-5 projects, but you would still need to be connected with an agent.

Very Important.

How do I package my project meeting all the EB-5 compliance while attracting foreign investors:  Almost all EB-5 investments being marketed abroad are at the $500,000 level. The bundle package of documents including EB-5 business plan either through direct investment or Regional Center must be compliant for USCIS and SEC.  There is a lot of competition in EB-5 arena. À la carte approach to presenting your project is difficult and destined to fail. We will recommend a service agreement with proposed compensation arrangement advice on commission structure, administrative payment/refund mechanism and marketing that have worked with our agent and investor pool on previous projects.  This service recommendation will depend on the maturity of your project Business Plan considering relevant SEC and USCIS compliant layering as well as documentation for PPM, LLP,  subscription agreement, and escrow. Additionally the BP needs to be translated and the format, presentation marketing materials appealing and informative to our investor pool.

Key Points of our group:

1. Authenticated BY US Sec state and Chinese consulate conducting EB-5 business

2. Contractual  Licensed Immigration Agency Peoples Republic of China (no intermediaries)

3. Affiliate (Mr. Kyong-Tae Noh partner) Seoul office with access to Korean based investors

4. SEC securities broker/dealer compliance

5. Depth of investor pool

6. History of projects

7. Use top 25 immigration counsel for 1-526 1-829 petitions

Currently we have active Level 1 (ready for raise projects)$115M RC Casino NV,  $22M ALF in Atlanta and $30M Multifamily living center in Texas. We have multiple Level II (arranging) projects including a new regional center in Georgia, Medical Center in Florida, Vegas show, and $1.2Billion Medical REIT fund.  

History:  Our team has been associated with EB-5 since 2009.   The group members have been involved in various forms of projects including hotels, ALF, hospitals convention centers.   The dynamics have changed dramatically for EB-5.  The  The investors are much more critical of relationships and EB-5 compliance. Immigration board in China will only issue licenses if the agency has the capacity.  It's important to note we (CN) are authenticated with US secretary of State and Chinese consulate to conduct this business.   Our group have access to substantial pool of high wealth private and party members in China. This is a vertical relationship. 

Our references:

We originally entered the EB-5 world organizing the Cancer Treatment Proton project in NY NYPRC (2010) http://www.nyprc.com/events.html and  current one Boca FL & http://www.bizjournals.com/southflorida/news/2012/02/01/boca-raton-hospital-signs-deal-for.html?page=all  We accumulated other projects over time (please see our brochure) and enjoy a joint exclusive relationship in Beijing with Shuang Zheng & Associates Ltd. Our relationship is authenticated by US Secretary of State and Chinese consulate in Washington DC and the Bureau immigration licensing in Beijing China.

Additionally Mona Shah our immigration counsel provides  affirmation to success of projects based on successful raises and 1-526 petitions with USCIS investors from China and Vietnam, and multiple projects, including the Ragged Mountain project, launched by New Hampshire Regional Center, projects for the Georgia Regional Center, Gold Mining in Alaska, PulseTech and Green NYC, RC, the Time Square Hotel (TSH) Project launched by the New York Immigration Fund (NYIF) Regional Center as well as the Brooklyn Navy Yard project and the Steiner Studios project for NYCRC among many others.  We are pleased this agency is well versed in Chinese Individual Income Taxation Code and Corporate Taxation Code, Chinese Foreign Currency Exchange Rules and Chinese Banking Regulation.  They do all the due diligence assuring 1-526 success as well.  They closed 75 million over the last few months.

More Stuff:

The process is not linear and these are approximate milestones.  But it’s important to note we would like to process all raises a.s.a.p. while Sponsors ask about the timing.  US companies must understand new projects that arrive at migration agency abroad, with complete due diligence presentation (compliant PPM and other docs) to substantiate your project, the process takes as long as it takes - the quality of the project And the amount of the funding dictates whether it can be funded in as little as 30 days to as long as 90-180 days.  There is no guarantee of funding as the market will dictate participation and you need to understand this clearly.  The more risky the project appears to be for the foreign nationals who will be providing the capital, the less likely they will be to select your project for funding.

CN docs are authenticated with Chinese authorities...Note this is very important...(Recent attention in accordance to Chinese law state EB-5 securities may only be sold through Chinese immigration intermediary service organizations (中介服务机构) that (a) have been licensed by relevant provincial-level Chinese Public Security Bureau Entry-Exit Administration Bureau; (b) have executed written cooperation agreements with qualified U.S. Immigration lawyers/approved businesses with at least 3-years EB5experience; and (c) whose EB5 projects have been vetted and approved by the relevant local Public Security Entry-Exit Administration Department