The EB-5 Immigrant Investor Program is one of the fastest and easiest ways for foreign nationals to obtain permanent resident status in the United States. The program allows foreign nationals to receive a U.S. green card in exchange for a qualifying investment in an EB-5 project. To be eligible, applicants must invest a minimum of $1.8 million in a new commercial enterprise (NCE). If the project is in a targeted employment area (TEA), the minimum investment requirement is reduced to $900,000.
EB-5 investors can invest directly in their chosen NCE, or they can invest in the project through an EB-5 regional center. Regional center projects are more likely to be located in a TEA, which allow investors to qualify for the lower minimum investment amount. Investors often choose to invest through regional centers for this reason, along with many others, including relaxed job creation requirements and fewer managerial responsibilities.
The EB-5 Regional Center Program remains extremely popular among EB-5 investors, but its permanence is not guaranteed. The program has continually been reauthorized by Congress for one-year periods or shorter. Congress also must resolve the issue of funding the program. On September 30, 2020, the EB-5 Regional Center Program will expire, but it is highly unlikely that the program will not get reauthorized being that a new resolution is already in the works.
Historically, the program has been reauthorized without the addition of any new changes, and this is expected to continue. Realistically, there is not enough time to introduce any significant changes to the program since the expiration date is so close. However, investors do not need to fear the program coming to an end on September 30, 2020. It is highly unlikely that the EB-5 Regional Center Program will be ending anytime in the near future.
What Are the Benefits of Investing through a Regional Center?
One of the main attractions of investing through a regional center is the lessened managerial responsibilities. If investing directly in a project, an EB-5 investor must participate in the day-to-day management decisions of the NCE. However, if the investor chooses to invest through a regional center, they can sign on as a limited partner and allow the regional center manager to handle most of the day-to-day decisions. This enables investors who lack managerial experience to be able to participate in the EB-5 program and still have a successful investment. This also gives the investor the freedom to live anywhere in the United States because they are not tied to the location of the NCE.
Regional center projects also can help ensure lower financial and immigration risk for the investor. EB-5 investors want to make sure their EB-5 project is going to be successful so it does not jeopardize their future in the United States. Regional centers carefully evaluate the projects they associate with to make sure they are low risk for investors. This can provide some relief to EB-5 investors because there is a higher probability of a successful investment.
EB-5 applicants are also drawn to the relaxed job creation requirements that the regional center program offers. To be eligible for a U.S. green card, EB-5 investors have to demonstrate that their investment has led to the creation of 10 new full-time jobs for U.S. workers. This job creation requirement is the same for all EB-5 investors. However, direct investors can only count direct jobs on the NCE’s payroll or those involved in the construction of the building. But investors who invest through a regional center can count indirect jobs, such as jobs from the NCE’s external suppliers and service providers, as well as jobs created in the community as the NCE employees spend their money. This makes it easier for EB-5 investors to satisfy the requirement and receive their U.S. green card.
Regardless of how an investor chooses to invest, they can still receive permanent resident status in the United States. This is a great opportunity for investors and their immediate family members to permanently relocate to the United States and enjoy the freedoms that come along with it. And, after the damage of the COVID-19 pandemic, the EB-5 program could provide the capital and job creation needed to kickstart the recovery of the U.S. economy.