EB-5 News Archive for January, 2010
A New York State legislator has proposed establishing an EB-5 regional center in his district to support a large-scale ski resort in the area in an attempt to draw in tourism.
The Saranac Lake Democrat, Tim Burpoe, who represents the upstate towns of Harrietstown and Franklin, says he has put the EB-5 investment opportunity on his list of priorities for 2010, the Adirondack Daily Enterprise reports.
Burpoe told the news source that Franklin County has already applied for the designation, and he expects to receive a response from the U.S. Citizenship and Immigration Services (USCIS) by the second quarter of the year.
The Adirondack Club and Resort project, a squad of upstate New York developers, have been targeting the Big Tupper Ski Area in Tupper Lake, as an ideal way to promote tourism in the area – but the team needs investors, says the news source.
The national EB-5 visa program would issue green cards to selected investors who are willing to spend at least $1 million in a U.S. business, provided their investment creates at least 10 jobs in the area.
Investors also have the option of endowing $500,000 to a business in areas of high unemployment.
Anonymous foreign financiers have taken advantage of an EB-5 investment opportunity, leading to the construction of a new restaurant, hotel and conference center in New Orleans.
The development firm NobelOutReach has been contracted to build the WOW Café and Wingery, Value Place Hotel and multipurpose convention center after the New Orleans EB-5 regional center brought in $20 million in foreign investments, USAdvisors reports.
On Wednesday, January 27, two ramshackle buildings on General DeGaulle Drive in Algiers, Louisiana, were demolished to make room for the new development that officials hope will ignite economic progress in the area.
Paul Richard, a commercial investment agent who marketed the tumbledown buildings for about five years, told the news source, “But for [the EB-5 investments], I’m not sure this deal could have been done.”
He added, “It ran the gamut of potential land uses, and it really became a function of which land use could underwrite the investment.”
NobleOutReach’s president Bart Hungerford said that federal securities law prohibits him from disclosing the number of investors related to the new project and their financial contributions.
However, the EB-5 visa program mandates that foreigners invest $1 million dollars to an American business or $500,000 to a business in an area of high unemployment in exchange for a U.S. green card.
The Start-up Founder Visa campaign has gained steam recently in its proposal to expand the existing EB-5 visa program so that the government could issue a U.S. green card to any company founder or entrepreneur who receives a set amount of private capital investment.
Organizers of the movement have pointed to several studies which they claim manifest the need for talented business-minded workers in key sectors of the American economy, IrishTimes.com reports.
A 2006 study by the U.S. National Venture Capital Association found that about 25 percent of every public venture company incorporated in the U.S. since 1990 had at least one immigrant founder.
These companies, which include household names like Yahoo, Sun Microsystems, eBay, Google and Intel collectively represent stocks and bonds valued at about $500 billion, according to the news source.
Additionally, a 2008 study commissioned by the U.S. Small Business Administration found that immigrants are almost 30 percent more likely to start a new business than U.S.-born citizens, and companies in the U.S. under foreign ownership have outperformed those launched by native Americans.
Currently, the EB-5 visa program allows foreigners who are willing to invest at least $500,000 in a U.S. company a way to live and work in the country, though immigration groups and lawmakers are actively looking to expand the requirements.
The growing popularity of EB-5 visa applications filed during 2009 and the corresponding waning of H-1B visa applications has caused immigration lawyers throughout the country to shift the focus of their practice.
According to H. Ronald Klasko, a lawyer in a Philadelphia immigration firm, though H-1B visas are usually a hot item – with application amounts exceeding yearly quotas in just a matter of weeks – the cap on visa numbers wasn’t reached for fiscal year 2010 until almost nine months after the first filing date, Law.com reports.
However, EB-5 visas, which award green cards to foreigners willing to invest at least $500,000 in a U.S. commercial enterprise, have kept immigration lawyers busy.
Klasko commented that a widely unknown commodity, the EB-5 visa program “hasn’t really become popular or been used much until about four or five years ago and hasn’t really totally boomed until the last year or two.”
In fact, he called the EB-5 visa “the hottest thing going on right now in immigration,” and has dedicated a significant portion of his work time traveling overseas to educate wealthy foreign investors about the visa program.
In total, the number of approved EB-5 visas has nearly tripled between fiscal years 2008 and 2009 from 1,443 to 4,218 visas, according to the US State Department.
Economic analysts in St Louis are levering the increasing popularity of the EB-5 visa program to publicize foreign investment opportunities and raise capital for the region’s industries.
The St Louis County Economic Council is currently finalizing an application to the U.S. State Department to become recognized as an EB-5 regional center, St Louis Today reports.
Becoming a regional center would make St Louis, St Louis County and St Charles County eligible to issue green cards to foreign nationals who invest at least $500,000 in U.S. businesses in areas with high unemployment rates.
“This is really a way for us to attract investment and jobs here, with people from around the globe investing in our own backyard,” Economic Council president Denny Coleman told the news source.
He added, “It’s a way to help equalize, if you will, the balance of international trade and investment.”
According to the Migration Policy Institute in Washington, D.C., hostile credit markets and high unemployment rates have led local economic development groups throughout the U.S. to seek new avenues of job creation.
In St Louis, officials are specifically looking to guide investment to start-up plant and life science incubators and companies that have a use for the vacated Chrysler plant in Fenton, Missouri.