Why Real Estate Is Attractive To EB 5 Investors

by , under Corporate, Law

Investor Visa

Investor Visa

Are you interested in getting an immigrant visa to the United States and have at least $500,000 to invest? If so, you may be eligible for the EB 5 Visa program. EB 5 investors are provided a green card in return for investing in the United States. The individual must invest either $500,000 in a Targeted Employment Area or $1,000,000 in another type of investment. Either of these investments must create at least ten jobs for U.S. workers, not including the investor and their immediate family. If the investor’s petition is approved, they are granted conditional permanent residency within the U.S. for two years. This program has grown significantly since the 2008 depression.

Attracting New Investment Since 2008

The financial crisis of 2008 hit traditional lenders hard resulting in tightened purse strings making it hard for developers to find capital. Many developers looking for money turned to alternative funding sources, including the EB-5 Visa program. Since 2008, this program has attracted more than $1.2 billion in foreign investment dollars. These investments not only bring money into the U.S. but also create jobs. One of the most popular options for EB-5 investments is real estate.

Why Real Estate Developers Like the EB-5 Program

EB-5 funding has comparatively low interest rates and there are no personal guarantee requirements. Some EB 5 projects can offer interest rates as low as two percent and almost never exceed six percent. Most EB 5 investments are for five years and may be eligible for a two-year extension.

Real estate developers like EB 5 money because it is available at such low-interest rates. Even so, EB 5 money can be unpredictable and the timing must be just right. It can take up to 12 months for a petition to be approved and the funding to become available. Real estate developers must be patient and work with these timing issues. Most real estate developers base their soft costs, land purchase, and even construction costs on the availability of the money, which makes an EB 5 investment challenging. Still, real estate developers often feel the low-interest rates and no personal guarantee make it worth the effort. Those looking to invest in EB 5 projects also like real estate projects.

The Attraction Of An EB 5 Investment

Real estate is a tangible investment, making it very attractive to those looking to obtain a green card through an EB 5 investment. More than 80 percent of those who invest in EB 5 are from China and these investors can easily travel into the U.S. to visit their project sites. It is also easy to obtain a value appraisal once the project is completed and the investor can do their due diligence with the developers. Most investors find real estate projects to provide a safe way to ensure the return on their investment.

EB 5 investors are required to invest a significant amount of money into the U.S. in return for a green card. The preferred investment project is real estate since both developers and investors can benefit from these types of projects.