An EB-5 investment is one of the fastest ways to obtain permanent residency status in the United States. However, that doesn’t mean the process is quick. Typically, the entire process takes at least two years, sometimes even up to 15 years if United States Citizenship and Immigration Services (USCIS) has not listed the investor’s country as “current” in their Visa Bulletin, published monthly. But those seeking a green card through an EB5 investment have a faster option: an expedited EB-5 project.
An expedited EB-5 project is an EB-5 project designated by USCIS as demonstrating either to be of compelling interest to the U.S. government or fulfilling an urgent humanitarian need. This allows a project to access EB-5 investment funds quicker to facilitate a faster construction timeline.
With this designation, investors need only wait two to four months for I-526 processing, instead of the typical two years. Instead of waiting for adjudication from USCIS, with the EB-5 program and the world subject to changes during that period, with an expedited project, an EB-5 investor can not only support a humanitarian cause but also help their family gain quicker access to the United States’ top education and medical systems. But there are things an investor ought to know about expedited EB-5 projects before diving in.
How Does a Project Qualify?
First, a high-ranking U.S. government official — the head of an entire agency or even a member of cabinet — must give the owner of the project a letter detailing the benefits the United States will receive from said project and why EB-5 capital must be released so quickly to the project. The letter should be accompanied by a sample of a completed I-526 petition to secure exemplar status, as well as a cover letter providing evidence to support the expedited release of EB-5 capital. The request for expedited status must be submitted as an I-924 petition. Once all that is done, USCIS must respond in 90 days.
Problems to Consider
Expedited status does not unlock more available visas for the EB-5 investment program. So, if an investor is from a backlogged country, not even having expedited status will change their wait times. Expedited projects also tend to carry higher financial and immigration risks than normal EB-5 projects. Furthermore, USCIS still subjects EB-5 investors to the same intense level of scrutiny, or even more, when evaluating their I-526 petitions for expedited projects.
But there are ways for investors to plan ahead and perform greater due diligence when considering an expedited project.
Due Diligence: Immigration Risk
With an expedited EB5 investment project, investors must still demonstrate that their EB-5 investment funds created at least 10 new full-time jobs for U.S. workers. EB-5 projects list the number of jobs they project to be created by each EB-5 investor. Investors should look at where the created jobs are coming from, as well as how many jobs they project owner expects the investor’s capital to create. If the number is close to 10, the investor risks potentially not creating enough jobs to meet their immigration requirement. Look for projects that plan higher job creation for each EB-5 investor to reduce this risk.
EB-5 investment participants should evaluate the experience level of the central actors involved in a potential project as well as their records of successfully completing previous EB-5-funded projects. If the expedited project is working with an EB-5 regional center, investors should ascertain what percentage of I-526 and I-829 petitions were approved by said regional center’s previous projects.
Other ways to perform due diligence and mitigate the immigration risk of an expedited EB-5 project include:
- Finding out whether the project company actually owns the land the project is built upon
- Making sure the expedited project has procured all approvals and licenses that are required for construction
- Looking into the overall funding of the project to ensure the developer has sufficient capital to complete construction
Due Diligence: Financial Risk
Typically, the financial risk for an EB-5 investor is greater in an expedited project because expedited status may only be granted to an EB-5 project if the EB-5 capital in question is deemed absolutely essential to the project’s construction and operation. Safer EB-5 projects are those that only use EB-5 capital to replace equity or debt, not actually fund the essential elements of construction. A lower percentage of EB-5 capital in the overall project funding means a safer project for E-5 investors.
Due to this increased financial risk, investors should look for means to provide greater protection for their investment when considering an expedited EB-5 investment project, such as the following:
- Finding out whether the expedited EB-5 project secures the investor’s EB-5 investment with real estate or other tangible assets
- Taking a closer look at the project’s cash flow to better assess the financial risk
- Signing a guaranty with an expedited project that, should the investor’s I-526 petition be denied, the money from their EB5 investment will be returned to them
- Looking for a project with a completion guaranty
In any case, when considering an expedited EB5 investment project, investors should make sure they know how and when their money will be paid back
Is an Expedited EB-5 Project Right for My Family?
Expedited EB-5 projects come with high risks and several disadvantages, but they can be an attractive opportunity for investors who truly need fast adjudication, such as those who are already residing in the United States but whose visa set to expire. Investors should work with an immigration attorney experienced in the EB-5 investment program and do as much due diligence and investigation of project documentation as they can to decide whether or not an expedited EB-5 project is the best choice for themselves and their family.