New USCIS Data: Major Implications for Rural and Urban EB-5 Investor Applications

New data is now available that finally brings some transparency to the EB-5 set-aside visa categories. In March 2022, the EB-5 Reform and Integrity Act (RIA) introduced new set-aside visa categories for investments in targeted employment areas (TEAs). Of the total number of EB-5 visas, 20% are set aside for Rural TEA investments and 10% are set aside for Urban TEA investments.

Since March 2022, USCIS has published limited data regarding these new set-aside visa categories other than summary-level data.

The American Immigrant Investor Alliance (AIIA) filed multiple Freedom of Information Act (FOIA) requests, which led to USCIS releasing the new data. This new data relates to EB-5 immigrant investor petitions, Forms I-526 and I-526E, with detailed information on investor petitions by country and by TEA category. We greatly appreciate the efforts of AIIA in getting this data released!

Download EB5AN Form I-526E Rural/Urban TEA Filing PowerPoint Analysis Deck

In this article, we explore what that data reveals about the EB-5 visa set-aside categories. Then we offer an honest, forward-looking analysis of the data. Finally, we suggest what you should do considering the new data and offer ways we can help.

Select Highlights of the Webinar: USCIS EB-5 Visa I-526(+E) Statistics:
Rural VS Non-Rural Filings by Country

Full Webinar: USCIS EB-5 Visa I-526(+E) Statistics:
Rural VS Non-Rural Filings by Country

What the New USCIS Data Reveals about EB-5 Visa Set-Asides

When the new visa set-asides went into effect, we correctly suspected that Urban TEA projects would receive more investment than Rural TEA projects. However, the data was not available, so did not know if that was true or by how much—until now. The new data reveals that Urban TEA projects are more than twice as popular as Rural TEA projects. Our expectation was based on years of industry experience and some common sense—it is much easier to find and structure Urban TEA projects than Rural TEA projects, and foreign investors are generally more familiar with Urban TEA project locations such as the New York metropolitan area.

From April 2022 to October 2023, a total of 1,045 EB-5 investors invested in Rural TEA projects, which represents 32% of all EB-5 investments during that period. A total of 2,122 EB-5 investors invested in high-unemployment Urban TEA projects, which represents 64% of all EB-5 investments for the period. A total of 101 EB-5 investors invested in non-TEA investments, representing 4% of all EB-5 investments.

Put another way, EB-5 investors are choosing Urban TEA investments over Rural TEA investments at a ratio of nearly 2 to 1.

The new data also shows which countries EB-5 investors are coming from. Mainland Chinese investors once again dominate the EB-5 landscape. Of the total 3,315 investors from April 2022 to October 2023, Chinese investors made up 1,738, or 52% of all EB-5 investors. Indian investors made up 561, or 17% of the total. EB-5 investors from all other countries made up 1,016, or 31% of the total.

Implications of This New Data

The data is clear. And while some groups may try to conceal or downplay this data, we are committed to providing an unbiased analysis. EB5AN structures both Urban TEA and Rural TEA projects, but our commitment is to our investors. Our goal is to provide transparent and clear analysis of the data so that investors can make fully informed investment decisions.

The single biggest implication of the new data is that the Urban TEA visa set-aside category is significantly oversubscribed. This category will not have enough visas to support the number of investors and their dependent family members. As a result, Chinese and Indian investors who invest in Urban TEA projects after February 2024 are likely going to face at least a five-year delay in getting their temporary Green Cards.

If we dive deeper into the real mechanics of visa allocation (e.g., the 7% country cap, Rest of World demand, etc.), the current wait for a new Chinese or Indian investor in the Urban TEA category is likely going to be much longer than five years. But this conclusion depends on other future-looking assumptions that are not yet confirmed.

We will break this analysis down in the following subsections.

How Many Visas Are Available?

Each year, only a certain number of visas are allotted to each reserved visa set-aside category out of the 10,000 total visas available per year. For the Urban TEA category, the number is 10% of total EB-5 visas for the year. For the Rural TEA category, the figure is 20% of the total. The law allows for one “carry over” year, so any unused reserved visas from the prior year carry over. For the last two years, additional EB-5 visas have been available beyond the typical annual 10,000 visas. Despite that, we assume that going forward the supply will return to the normal 10,000 EB-5 visas per year.

We estimate that the total number of visas currently available under the Urban TEA category is 2,542. This figure accounts for 1,000 visas per year for two years plus additional visas allocated over the last two years.

We estimate that the total number of visas currently available under the Rural TEA category is 5,085 based on the annual visas plus rollover visas.

Note that for simplification, our PowerPoint analysis sets forth an even more conservative calculation that does not include carryover visas for either the Urban TEA or Rural TEA visa categories. In other words, that analysis reflects only 2,000 Urban TEA visas and 4,000 Rural TEA visas. Also, the PowerPoint analysis assumes that the volume of new I-526E applications in November 2023 through February 2024 was consistent with the prior three months; in reality, application volume has been trending upward, and this is likely understated.

How Many Visas Are Needed?

The new data shows, through October 2023, a total of 2,122 investors invested in the Urban TEA category and 1,045 investors invested in the Rural TEA category. If we project these numbers out to the current date—the end of February 2024—the total number of investor applications in Urban TEA projects would be 2,849. The current number of investor applications in Rural TEA projects would be 1,622. This likely underestimates demand because the number of investors has risen in February and March 2024 due to an I-526E fee increase scheduled for April 1, 2024.

But the number of applications does not directly correlate with the number of visas needed. This is because multiple people may apply for EB-5 visas under each application. The investor, his or her spouse, and their dependent children under age 21 will all apply for their visas under the single application.

For our analysis, we assume an average of 2.5 visas per application (or family). Historically this has been a relatively accurate predictor of visas required per application.

So what does that all mean?

Through February 2024, we estimate that 7,122 visas are needed for Urban TEA investors and their families. We get this number by multiplying 2,849 applications through February 2024 by 2.5, which is 7,122 visas. This number far exceeds the 2,542 visas available to Urban TEA investors.

For Rural TEA investors and their families, we estimate that a total of 4,056 visas are needed. This number is found by multiplying 1,622 applications by 2.5, which is 4,056 visas. This means that 1,029 visas remain available under the Rural TEA category.

To summarize, 7,122 visas are needed for Urban TEA investors, but only 2,542 visas are available, meaning this category is backlogged. On the other hand, 4,056 visas are needed for Rural TEA investors, and 5,085 are available, more than enough to meet current demand.

While we believe the analysis above is accurate, it is simplified. The situation is complex, and additional nuances could be considered. For instance, the analysis could take into consideration when certain rollover visas expire, when I-526E approvals arrive and visas are actually issued, etc. But all of these other issues are outside of the basic supply / demand dynamics and tend only to muddy the picture. We are using common sense assumptions. For example, our analysis assumes all of the I-526E applications are approved today. In reality, it may take one to two years for these approvals—but that will only make the situation worse since some rollover visas will be lost. Also, we assume an average of only 2.5 visas per application (or family), but this may be significantly higher, which would also make the backlog even longer.

To get even more accurate, current data on the number of visas per application (or family) we would appreciate any help from EB-5 immigration attorneys reading this post. For any EB-5 immigration attorneys that have filed over 10 I-526Es since March 2022, we ask your help in sending us your data (number of family members per I-526E) for us to compile even more accurate data to help best predict the number of visas required per applicant. Please send any available data/information to info@eb5an.com.

Who Will Be Impacted?

Each country is allotted a percentage of total EB-5 visas each year. If the number of applications from a particular country exceeds their share of the total, investors from that country experience visa retrogression. Visa retrogression means that the number of visa applications exceeds the number of available visas.

Investors from Mainland China and India make up the biggest share of Urban TEA investors. They will be the most impacted by visa retrogression. Investors who invest in Urban TEA projects going forward should expect significant delays.

Although China and India are the obvious impacts, based on the data, many other countries will be impacted at a smaller scale. Unfortunately, with only 1,000 set-aside Urban TEA visas per year, and with each country guaranteed 7% of these visas, only 70 of these set-aside EB-5 visas are allotted to each country per year. If you take the average of 2.5 visas per application, this means that each year, only about 30 EB-5 investors and their families from a given country will receive set-aside visas under the Urban TEA category. Any number of applications beyond this will be delayed until more visas are allocated in the following year.

Based on our preliminary analysis, Korea, Vietnam, Taiwan, and possibly some other countries will already exceed the 70-visa allotment. Taiwan, for example, has nearly 200 Urban TEA applications, which may represent more than five years of set-aside visas.

The detailed impacts of the new data could be further analyzed, but the basic supply / demand dynamic is clear. Urban TEA set-aside visas will not support more than about 30 I-526E applications per country per year before hitting at least a short backlog.

Note that retrogression has not been officially announced in the U.S. State Department monthly visa bulletin and may not be announced for several months—or longer. Until then, we simply do not know how many investors will be affected or how significant the delays will be. But based on prior experience, we expect delays of at least five years for China and India (the highest volume countries). Delays are also highly likely for Vietnam, South Korea, and Taiwan.

The industry has gone through this before in 2014-2016 with China. At that time, the Chinese backlog was more than five years before any type of backlog was officially reflected on the monthly visa bulletin.

What about Rural TEA Investments?

Based on our analysis, the Rural TEA visa set-aside category will remain current if the number of Rural TEA investments per year remains the same. But with the Urban TEA category oversubscribed, more investors are likely to choose rural projects.

It is likely only a matter of time before the Rural TEA category is also oversubscribed. It would still take another year or longer to backlog the Rural TEA category even with a drastic shift away from Urban TEAs. But monitoring this situation is critical and is one reason real-time data is so important.

Next Steps for EB-5 Investors in Light of the New Data from USCIS

Simply put, if you are a Chinese or Indian national looking for an EB-5 investment, you should avoid Urban TEA projects unless you are willing to wait for at least five years for a temporary Green Card.

Some investors in the United States that can adjust status may be fine with a long wait for a Green Card and choose an Urban TEA project. Such investors could apply for their work and travel documents, which are valid for five years. Projects like EB5AN’s Boynton Beach Multifamily (Loan / Equity) have a shorter investment duration, which means investors could live and work in the United States and get their EB-5 investments repaid while waiting for their Green Cards.

The alternative to this is to search for a high-quality, low risk Rural TEA project. Investing in a Rural TEA project will give you the best chance at getting your Green Card quickly, without the delays associated with visa retrogression.

If you are a Chinese or Indian national and have already invested in an Urban TEA project, you will have to wait and see whether you will experience a delay and, if so, how long that delay will be. When the raw data is released, you can do analysis on what month your I-526E application was submitted versus how many applications from your country were submitted prior to that. This will allow for a rough estimate.

If you are not from China or India, your impact will likely be less, but we would suggest proceeding with caution and reviewing the data. Korea, Vietnam, and Taiwan are all at-risk, and the waits could be nearly as long as those for China and India due to the reduced number of Urban TEA set-aside visas available per country each year.

Finally, if you were considering an investment in an Urban TEA project but have not yet filed your I-526E Petition, now may be a good time to speak with your immigration attorney and seriously consider changing to a Rural TEA project given this new information.

How EB5AN Can Help You in Your EB-5 Investment Journey

EB5AN remains committed to transparently providing you with facts and careful, honest analysis. Although we offer Urban TEA projects and have historically focused on this type of offering, we always put our investors first and give them the information they need to make informed decisions.

We are disturbed by the trend of some other regional centers, immigration attorneys, and EB-5 brokers that simply are not sharing this vital information. We saw this before in China in 2014–2016 when investors were blatantly misled—and those investors are still waiting for their Green Cards. The difference this time is the data is available before the backlog has been reflected on the monthly visa bulletin, and investors can make an informed choice.

You can trust that we will continue to provide you accurate, up-to-date information regardless of what that may mean for our projects.

In light of the looming visa retrogression for Urban TEA investments for investors from specific countries, we would encourage you to consider our best-in-class Rural TEA project offerings. We have partnered with excellent developers to bring high-quality EB-5 projects that offer the highest levels of immigration and financial safety on the market today.

If you are not sure where to start or need information, you can schedule a free one-on-one consultation. If you are seriously considering making an EB-5 investment to secure your future in the United States, but need help to understand how to get started with EB-5 source of funds, we offer free source of funds consultations, with one of the most experienced EB-5 immigration attorneys as well.

¹ Data available as of March 1, 2024, ends partway through November 2023. For this analysis, we only consider the complete data through the end of October 2023, the most recent complete month.