What do the most successful EB-5 projects have in common?
What are these successful EB-5 projects' qualities?
Met a demand in the marketplace
These projects met market demands. For example, a growing university town needed additional student housing to fill the increasing demand, and an EB-5 project was constructed that provided students with new apartment housing to fill that need. Another example of a strong EB-5 project could be one that fills the demand for new senior living residences in a city that increasingly attracts retirees and aging baby boomers.
Had a big city location
Revamping old or unused spaces in major cities boosted the economy and created new jobs in densely populated areas. In major cities, space is limited, so project developers turned to old and outdated malls and industrial complexes to refurbish and modernize existing spaces into mixed-use projects near already established commuter lines. Due to the complexity of how targeted employment areas (TEA) are established, many major cities, such as New York City, were counted as TEA and qualified for the lower minimum investment amount of $500,000. This lower investment amount attracted more foreign investors to projects.
Counted direct, indirect and induced job creation
These EB-5 projects created quality jobs not only within the projects, but also within the community. These large projects needed suppliers, venders and independent contractors. They had a strong economic impact on the local community and spurred spending and growth.
Possessed a clear project strategy
These EB-5 projects had clear and defined strategies. They had established the scope of their project. They had a business plan that outlined their timeline for construction, job creation, and exit strategy.
Acted with transparency and reliability
These project developers had established reputations for transparency and reliability. They had track records for completing past projects. (Note, however, that past performance does not guarantee future success because all projects must be "at-risk".) These project managers stayed in close and secure communication with their investors, which was essential because investors do not speak the same language, nor do they necessarily live near their investment.
Were EB-5 compliant
In addition to being transparent and reliable, EB-5 investors want to see that their project sponsors are compliant with the complex EB-5 regulations. These successful project teams showed their investors, with thorough evidence, how they were equipped to handle EB-5 compliance.