Program for Overseas Investors

Special Program Smooths Path to Visas for Overseas Investors

Boston developer Steve Samuels needed financing for his latest project, a 30-story condominium and retail tower on track to rise from the site of a Fenway sandwich shop. But instead of turning only to large banks and institutional investors, he jetted to Hangzhou, a Chinese city that is home to the e-commerce juggernaut Alibaba and a small army of overnight millionaires.

There, in November, Samuels pitched his development and a visa program that provides green cards to foreigners who invest at least $500,000 in US projects that create jobs. Samuels hopes to use the program to entice about 100 foreign investors to put up nearly $50 million for his $290 million development, the Point, at Boylston Street and Brookline Avenue.

His company, Samuels & Associates, is among the increasing number of American businesses turning to the visa, called EB-5, to help finance enterprises from hotels to sports arenas to condominiums. EB-5 applications — nearly 11,000 last year — have surged more than eightfold since 2008; over the past decade, the program has attracted about $6.5 billion to hundreds of projects across the country and supported more than 130,000 jobs, according to trade groups.

In Massachusetts, where the visa program has been little used, a red-hot real estate market is leading more developers to consider it, as competition for traditional financing rises and costs follow. So far, three local projects have attracted more than $6 million through the EB-5 program; Samuels’ Fenway project would be the largest in the state to raise money through the visas.

“EB-5 is one of many tools that developers like Samuels use to finance large, complex projects,” said Diana Pisciotta, a spokeswoman for the company. She declined to disclose how much Samuels has raised so far.

The investor visas were created 25 years ago to help generate jobs in the United States, especially in areas of high unemployment. The program, however, has become controversial as more visas are granted. Critics say the government is allowing wealthy families to buy their way into the country and jump to the front of the line for green cards, even as immigration officials leave so many others fleeing violence, persecution, and poverty in limbo.

“There are millions of people who have been contributing to the US economy and have maintained the economy,” said Alexandra Early, coordinator for the Chelsea Collaborative’s Workers Center, which advocates for immigrant rights. “What doors are available to them to stay here?”

Foreign nationals who put at least $500,000 into US projects can obtain two-year probationary visas for themselves and immediate family members, and then can obtain green cards, or permanent resident status, if the enterprises create enough jobs. The investors must demonstrate their money has led to at least 10 new jobs, but the requirement is broadly construed. It can include workers at a new building, construction workers who built it, or service workers at nearby restaurants benefiting from the increased activity.

The companies and investors are usually connected by so-called regional centers, primarily for-profit brokers authorized by US Citizenship and Immigration Services. They charge developers to find investors and foreigners for help navigating the EB-5 program and immigration bureaucracy.

To attract investors, regional centers promote their expertise in immigration law and experience working on successful projects. They also emphasize any kind of government support, which can be highly prized by foreign nationals, who typically seek low-risk projects that will pay back their investment and provide a safe path to a green card.

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Richmond Investment Firm Receives Federal EB-5

Richmond Investment Firm Receives Federal EB-5 Regional Center Designation

RZ International-Virginia (RZI-VA) today announced, that its application to the U.S. Citizenship and Immigration Service (USCIS) for designation as an EB-5 Regional Center under the EB-5 Immigrant Investor Pilot Program has been approved. RZI-VA, an international investment firm headquartered in Richmond, is now authorized to access the EB-5 program to attract international investment capital to fund the development of Virginia real estate projects.

Founded by Mike Elias, a veteran of Wall Street firms Morgan Stanley and Deutsche Bank, RZI-VA will be managed by Renaissance Community Partners (RCP), a community economic development private equity and advisory firm with a focus on emerging domestic communities.

Robert K. Jenkins, Jr., a real estate finance attorney and longtime Virginia community economic development practitioner, founded RCP. Jenkins has served as COO of the Norfolk Redevelopment & Housing Authority, the largest municipal community development agency in Virginia. He was the founding CEO of Hampton Roads Ventures (HRV), a successful Norfolk-based community economic development investment firm that is active in the New Markets Tax Credit program.

Just has he did during his tenure as CEO at HRV, Jenkins plans to access the EB-5 program to attract flexible, nontraditional capital to help finance a variety of significant real estate projects throughout Virginia. Some of his previous successful projects include:

Norfolk, Va: The development of a 110-room Marriott SpringHill Suites hotel adjacent to Old Dominion University, Staunton, Va: The adaptive reuse of the boarded and functionally obsolete Lee High school building into Gypsy Hill, a state-of-the-art mixed-use building with offices and community facilities of the first floor and 70 senior citizen housing units above; and Duffield, Va: Winegar Medical Center, a 26,500 SF community medical facility that tripled the number of physicians serving the depressed community in rural Appalachia.

“The EB-5 program, like NMTC and other community development finance initiatives, is an excellent vehicle to attract much needed, flexible and non-traditional investment capital into Virginia’s inner city and rural communities. Mike and I look forward to partnering with community, business and government leaders to use our EB-5 Regional Center designation to attract capital from across the globe into Virginia communities. We are particularly interested in assisting projects that create jobs while bringing much needed quality goods and services to historically underserved neighborhoods,” said Jenkins.

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Clintons and Bush Family Has Ties To Visa Program For Wealthy Foreign Investors

EB-5 Program a Primary Way Chinese are Investing

The EB-5 foreign investor program was created by the U.S. government in 1990 as a way to spur economic growth through the awarding of resident visas.

But it was seldom used for two decades. In 2004, just 247 foreign investors applied for visas under the program and there were still fewer than 2,000 applicants in 2010.

But with a flood of Chinese nationals now looking for ways to spend their accumulated wealth and take advantage of China’s recently relaxed foreign investment regulations, the program has exploded.

For the first time in the program’s 25 years, all 10,000 visas available annually were granted through the fiscal year ending Sept. 30, 2014 – and U.S. Citizenship and Immigration Services was tapped out by August.

Though a number of countries have access to the program and each is allotted 7 percent of the available visas each year, other participating countries can scoop up a nation’s unused visas. That allowed investors from China to take about 85 percent of the visas awarded last year.

“It takes a long time and it’s risky and you could lose your money, so if there’s another way that’s what I try to do for my clients,” said Johanna Keamy-Tavares, a San Diego attorney who for the past 17 years has specialized in business immigration law with a focus on foreign investors. “With the Chinese there aren’t a lot of options so they usually go through the EB-5 program.”

There are at least four confirmed EB-5 projects either underway or being funded on the Grand Strand, including three involving the Myrtle Beach company America EB-5 Group.

“EB-5 is economic development,” said Tom Morrison, one of four partners and CEO of America EB-5 Group as well as owner and CEO of the Grand Strand Tee-Offs golf package company. “It’s better than most people’s perception of it. I think it means good things for the area. In our market it’s going to be great for us for long-term sustainability.”

The program’s name is derived from the visa category for which immigrant investors apply – the Employment-Based Fifth Visa. USCIS says from 1990 through 2013, the program was responsible for at least 57,300 jobs created and more than $8.6 billion invested.

To qualify as an EB-5 project, a foreign national must invest at least $1 million and create 10 jobs for a minimum period of two years. The reward is temporary U.S. resident visas for the investor, a spouse and their unmarried children under 21. The visas can be converted to permanent resident visas after two years and U.S. citizenship after five. Any child born in the U.S. to the visa holders is automatically a U.S. citizen.

Only a $500,000 investment is needed in what are deemed high-unemployment or rural areas known as Targeted Employment Areas, and the vast majority of projects qualify for the lesser requirement. Jobs created directly or indirectly can be counted among the 10 in TEAs.

If there are multiple partners in an EB-5 project, the family of another partner can gain visas for every $500,000 or $1 million invested and 10 jobs created.

Read more here: http://www.thestate.com/news/business/article17319707.html#storylink=cpy