Financing Projects With EB-5 Funds?

LOS ANGELES—The EB-5 investor visa program, administered by the US Citizenship and Immigration Services has raised hundreds of millions of dollars for real estate development throughout the United States over just the past five years, according to Catherine DeBono Holmes, chair of the investment capital law group at Jeffer Mangels Butler & Mitchell LLP, who has represented more than 50 real estate developers in obtaining EB-5 financing for their projects. “Some of the largest real estate developers in the country, including Related Cos., Silverstein Properties, Forest City Ratner, and many others, have raised hundreds of millions of dollars through the EB-5 program  to help finance their largest real estate developments,” she says. “Smaller real estate developers have also been successful in raising EB-5 financing to support their development projects.”

There have also been some EB-5 financed projects that have failed, and some cases of blatant fraud by a few bad actors, she notes. “The recent Fortune Magazine article about the Chicago Convention Center case that occurred in 2012 painted a dark portrait, making it appear as if this one case was representative of the entire EB-5 program. The article failed to present an accurate portrayal of the EB-5 program as a whole, failed to mention the multitude of EB-5 financed projects that have succeeded, and caused confusion among real estate developers about whether or not EB-5 financing is a viable source of capital for their projects.”