Investing Directly vs. Investing with a Regional Center
NON- REGIONAL CENTER DIRECT INVESTMENT
1) The foreign investor must seek out and identify an investment project that meets all of the requirements need to qualify for the EB-5 visa standard program before he leaves his native land.
2) The foreign investor must submit a computer generated IMPLAN or RIMS II job creation study to the USCIS to qualify the project for acceptance.
3) The foreign investor must submit an economic impact study for the project to the USCIS to document the economic impact that the project will have on the local, regional, state and national economy.
4) The foreign investor must invest at least $1,000,000 in the project.
5) The foreign investor must have daily direct management involvement and responsibility in the business or project.
6) Because of (5) above, the foreign investor must live in the area where the project is located and he has a limited ability to return and visit his native country during the term if his investment and until he becomes a citizen (usually 5 years or more).
7) The foreign investor is directly responsible at all times that his investment has created 10 new jobs. This must be documented and reported every 3 months to the USCIS.
8) The foreign investor must keep accurate records and file other reports on his business to the USCIS every 3 months.
9) The foreign investor is responsible for his own exit strategy.
10) The foreign investor can only count direct new jobs created by his project for reporting to the USCIS. Ten new direct jobs must be created for each foreign investor. The foreign investor and his family members are not eligible to be counted.
11) The investment must be in the form of equity, not debt.
12) Projects for investment are limited in scope since pooled funds from several investors are not allowed and there is only one RB-5 investor in a project.
INVESTMENT THROUGH A REGIONAL CENTER
1) A Regional Center seeks out and finds investment projects that meet all of the requirements to qualify for the EB-5 visa program. It is then offered to the foreign investor (the EB-5 Client).
2) Investment through a Regional Center allows the EB-5 Client to invest either $500,000 or $1,000,000. If he invests directly and does not invest through a Regional Center, his investment must be $1,000,000. The USCIS restricts investment of $500,000 to Regional Center investments in Targeted Employment and Rural Areas (TEA’s and RA’s). This option allows a Regional Center to give the EB-5 Client many more investment options from which to choose.
3) MCFI requires that the project developer or manager furnish MCFI with a Business Plan with a “Matter of Ho” clause, a Proforma, a Project Financial Summary, a computer generated IMPLAN or RIMS II job creation study and economic impact study, a Private Placement Memorandum (PPM), a Subscription Agreement, a project management agreement and plan including the qualifications of the manager, an offer for the EB-5 Client to visit the project to meet the developers and manager before he invests and a proposed exit strategy after five years. All of these are then made available to the EB-5 Client upon written request.
4) Regional Centers manage investments for the foreign investor and the investor has no management responsibilities. The MCFI EB-5 Client gets his money back first when the investment is sold before any profits are divided. MCFI makes no money unless the EB-5 Client makes money.
5) Regional Centers help the EB-5 Client comply with all of the regulatory and reporting requirements of the USCIS, including the job creation and economic impact requirements, etc.
6) In addition to direct job creation, Regional Centers are allowed to count indirect, imputed and construction jobs in their calculation of job creation for the EB-5 visa program (10 new jobs for each foreign investor).
7) Regional Centers can pool funds from several different investors which then allows investment in much larger projects. Because of this, many more projects with higher investment returns can be offered through Regional Centers.
8) When the EB-5 Client invests through a Regional Center, he can live and work in any area of the U.S. He does not have to live in the area where the project is located since he is not required to have direct management responsibilities. This also him to have much greater freedom to return to his native land and visit for extended periods of time.
9) A Regional Center can offer a wide variety of projects. The EB-5 Client can then choose the one which best suits his investment goals.
10) Although by law, an exit strategy can not be guaranteed, investing through a Regional Center allows a much more defined strategy in regards to the investment (debt or equity type of investment), the return on investment and a possible exit strategy.
11) A Regional Center allows the EB-5 Client who invests through a limited partnership in a qualified investment offered by the Regional Center, to have the exactly the same rights as an American citizen in that investment.
12) A Regional Center helps the EB-5 Client through the entire immigration process by furnishing him with the names and contact information of immigration and tax attorneys, investment and financial advisors and accountants.
13) MCFI also provides financial analysis and underwriting of projects that we offer by an independent underwriting firm and which is then furnished to the potential EB-5 Client to help him choose his investment.