Within the EB5 program, investors have multiple investment methods to choose from: direct or through a regional center. The vast majority of all EB5 investments are made through regional centers, largely due to the lower minimum investment amount and the more “hands off”, passive approach investors can take. Regional centers will handle business documents, legal forms, and ensure project compliance with EB5 program regulations. Additionally, they accrue expenses from attracting investors and paying finder’s fees for agents who recruit investors. In exchange, an investor must pay administration fees to cover the expenses incurred in the process of offering the project. These fees are unrelated to the initial EB-5 investment and do not count towards it. However, most centers require them to be paid up front before the investor even files their I-526 petition. Administration fees vary widely between regional centers, but usually fall somewhere between $50,000 and $70,000, with an average of $60,000.
Of course, investors could navigate the required forms, regulations, and business documents themselves, but it would cost them much more time, energy, and money. Extensive planning and knowledge is necessary for a successful EB-5 investment. Project participants must ensure everything is done legally, forecast the financial success of the project, and so forth. This level of planning involves a team of people, each with a specific area of expertise, whose services are worth paying for.
EB5 investors may still find themselves wondering if EB5 regional center administration fees are negotiable. The short answer is sometimes. While investors are allowed to approach a regional center project directly to inquire about negotiating administration fees, it is very unlikely a regional center will do so. Most of the time, administration fees remain consistent for all investors. At the same time, investors who insist on lower fees can get them. However, unless the possibility of charging different fees to different investors is stated in the project’s offering documents, this practice is generally considered irregular and is avoided.
