EYNTK About EB 5
The bottom line: The program promises EB-5 visas to foreigners who invest (at least $500,000) in American projects employing 10 or more domestic workers.
Also known as: The Immigrant Investor Program
Origins: Congress created the program through the Immigration Act of 1990, which altered deportation rules and non-immigrant visa categories while tightening legal immigration protocols.
Biggest Beneficiaries: Steve Ross’ Related Cos. chased $800M in EB-5 financing for its massive Hudson Yards project on Manhattan’s Far West Side. The Andaz hotel group has also flocked to the program, closing on investments in a Palm Springs property.
Good deeds: Developments in “Targeted Employment Areas,” or lower-income neighborhoods, require the $500,000 investment while affluent locations have a $1M threshold.
Channels: For-profit “regional centers” organize and funnel the foreign investments into various projects.
Interest rates: Range from 3 to 5%
Controversies: “Finders” who collect a fee for linking developers to overseas investors have run into trouble with the SEC. And a Fortune article headlined “The Dark, Disturbing World of the Visa-for-Sale Program” slammed the program as a shady backdoor entrance for wealthy—and mostly Chinese—foreigners at the expense of “the skilled and the poor.”
Limits: The program rewards no more than 10,000 visas a year.
Overseer: U.S. Citizenship and Immigration Services