Lawmakers Press for Changes to EB-5 Program

While developers have capitalized on the record amount of money that has flowed through the EB-5 program, lawmakers are seeking changes to the program when it comes up for renewal in September. Proposed legislation aims to ensure that poorer areas are being adequately served and to make it tougher for developers in big cities to access funds. The EB-5 program, which grants green cards to foreigners that invest a minimum of $500k in projects that create jobs for American workers, became a popular for tool for real estate companies when other sources of capital dried up during the financial crisis, reports Bloomberg. New York has benefited from $3.2B through the program since 2010, including at Related Cos. Hudson Yards project, which has raised about $600M in EB-5 funds. The proposed bill seeks to redirect investments to poor and rural communities that were the intended beneficiaries when the program began in 1993. The bill also proposes raising the minimum investment to 800k and having stricter fraud protection in place. There is little doubt that the program will be renewed, but questions about the final form it will take may delay investments. [Bloomberg]

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