Commercial Investment Real Estate is the magazine of the CCIM Institute, the leading provider of commercial real estate education. CIRE covers market trends, current developments, and business strategies within the commercial real estate field.
Issue link: http://cire.epubxp.com/i/143044
EB-5 investments can be used for almost any commercial real estate project. and due diligence on the project, the business, and the company business plan. Moreover, the lead time to funding also encompasses negotiation and execution of the investment documents between the project sponsor and the regional center; marketing of the investment opportunity overseas; securing of foreign investment funds; application, review, and processing of investor visa applications; and, fnally, delivery of investment proceeds to the project. To be clear, whether EB-5 project investments are made through loan or equity model, such investments will pool funds from multiple investors and the overall number of investors is limited only by the aggregate size of the investment (keeping the applicable minimum investment requirements in mind, however). If both the project and an investor are approved by USCIS, the investor receives a conditional two-year green card. The investor and immediate family can apply for permanent residency based on the EB-5 investment. If approved, EB-5 investors then become permanent green card holders and can later apply to become U.S. citizens. Upon receipt of conditional permanent resident status, investors and their immediate families are entitled to the same benefts as other lawful permanent residents. For eligible projects, the EB-5 program ofers developers access to diversifed project funding. Whether through a debt-based or equity-based model, EB-5 can help developers close funding gaps, increase capital stacks, or expand equity. Other than the $1 million investment requirement (or $500,000 in applicable geographic locations), there is no defnitive minimum investment required. The time and costs involved in securing funds and approvals, however, may create cost inefciencies for projects requiring less than $5 million in funds. But sponsors of large development projects, particularly those with lengthy lead or build times, may fnd signifcant benefts and fnancing cost savings using EB-5 funds. Of course, as with most evolving programs, the EB-5 standards and rules remain fuid. Developers should be sure to consult with qualifed counsel to ensure the developer's interests are well protected and overall project compliance is maintained. Geoffrey S. Goss is a partner in the Real Estate Practice Group of Cleveland-based Walter Haverfield. Contact him at ggoss@walterhav. com. WARDCENTERFOR 2EAL %STATE 3TUDIES (IGHER %DUCATION FOR 4ODAYS 2EAL %STATE 0ROFESSIONAL NOW IS THE TIME TO BUY Ultimate Group Sponsor Workshop Gene Trowbridge, CCIM, senior partner at Trowbridge & Taylor LLP, will show you how to attract and pool private money to finance your commercial real estate deals and increase buying power. This 3-day workshop covers how to: s 3TRUCTURE YOUR DEALS INCLUDING WHAT LEGAL ENTITIES TO USE s 2AISE MONEY WHILE FOLLOWING APPLICABLE SECURITIES LAWS s &INANCE; DEALS TO MEET INVESTORS EXPECTATIONS NEXT OFFERINGS START IN CHICAGO: Sept. 16 - 18 To learn more about this course, visit www.ccim.com/education/course/UGS or call (800) 621-7027, ext. 3100. CCIM.com July | August | 2013 19