With President Biden’s expected signature on Friday, the EB-5 immigrant investor program is being renewed for five years, through September 30, 2027, as part of a massive U.S. government funding bill, giving hotel developers renewed opportunities to tap into this alternative source of funding.
After a lapse of more than eight months, the “EB-5 Reform and Integrity Act of 2022,” which is part of the overall U.S. Omnibus Spending Bill, reauthorizes regional centers to manage pools of investments from non-residents who want to invest and gain access to green card residency for them and their family members in the U.S.
“We like the new integrity provisions which keeps the program safer for investors,” said Grant King, CEO of Relevant Group, who owns the Thompson Hollywood, Tommie Hollywood and Dream Hotel Hollywood. “We appreciate the thought that went into drafting these measures for Regional Centers.”
The reauthorization will update the program in some ways, including the amount foreign investors need to invest to apply – the new minimum is US$800,000 versus the previous US$500,000 for Targeted Employment Areas and Rural Areas, and US$1.05 million from the current US$1 million for Non-Targeted Employment Areas for both regional center and direct EB-5 investments. The bill allocates 20% of total EB-5 visa numbers to investments in rural areas, 10% to investments in high-unemployment areas, and 2% to infrastructure projects.
“EB-5 is back and here to stay,” said Ali Jahangiri, CEO of eb5investors.com and publisher of the EB-5 handbook. “I am proud of our community and all the hard work everyone did to get this past the finish line. Congratulations to everyone who has hung in there for the past couple of years.”
The EB-5 program (the fifth employment-based category under the immigration law) sets aside nearly 10,000 visas a year for investors and their families; since the family size averages 2.5 people, this means that about 4,000 new investments a year can come through this route.
“We now go into into a very exciting time in the EB-5 world, as after nine months of absolute uncertainty there is a bright light at the end of the tunnel,” said David Hirson, founder of David Hirson & Partners, LLP. “There is a pent up demand for EB-5 investments and there is a pent up demand by investors throughout the world. The current wars and uncertainties around the world increase the numbers of potential and willing investors.”