EB-5 funding is a very enticing option for many real estate developers. Banks are still hesitant to provide construction loans and EB-5 interest rates are much lower compared to the rates of traditional financing.
Real estate project developers can acquire tens or even hundreds of millions of dollars in EB-5 funding if they know what they're doing.
Here are 3 tips that can help real estate developers score EB-5 funding for their projects.
- Read up on the EB-5 Program
Does your project qualify for the EB-5 Program? Will you do a direct investment or work with a regional center.
Most project developers choose to work with regional centers, but finding the best one for your project takes time and due diligence. Each regional center works with projects in specific industries and in specific locations that qualify as TEAs (Targeted Employment Areas or rural areas of high unemployment). It's important that project developers look into what qualifies as a TEA because many areas can be considered a TEA even if they don't appear to be one at first, such as New York City.
Additionally, project developers need to stay up to date on the guidelines for the EB-5 Program as well as important dates and fees because they frequently change.
- Find a strong team
The right economist can make the difference between being able to secure $10 million in EB-5 funding and $25 million in EB-5 funding. Why is that? This is because the amount that a project can secure in EB-5 capital is proportional to the number of jobs the project is forecasted to create. A requirement of the EB-5 Program is that each EB-5 investor must create 10 full-time jobs for qualified U.S. workers. Therefore, an economist who's knowledgeable and experienced with the EB-5 Program will know how to best count direct, indirect, and induced employment so that the project can raise the maximum amount of funding they need.
An EB-5 immigration attorney can also assist with finding qualified investors. Additionally, a strong immigration attorney on the team will help make sure each EB-5 investor's petitions and paperwork are processed correctly and on time.
- Gain exemplar status
Apply for exemplar status from USCIS for your EB-5 project. This means that your project has USCIS pre-approval and it's something that appeals to many EB-5 investors. It's a great marketing point for EB-5 projects because it means that investors will have less time to wait for their approvals. The process of gaining exemplar status can take as long as two years, but it may mean a lot less work for you later on in the process.