Articles Posted in EB-5 Financing

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17 July 2016

New York EB-5 Investment Immigration Convention

More than 700 people are gathering the next two days in New York City for one of the largest EB-5 financing conferences in the country. We are proud to be a platinum sponsor of this program, and I am looking forward to my panel on how to finance hotel construction and development with EB-5.

Hosted by EB-5 Investors Magazine, this event will be held July 17-18, 2016 at the Sheraton Hotel in Times Square. The first day is comprised of three tracks of workshops and Monday is a full day of panels on EB-5 topics of current interest.

Dr. Arthur B. Laffer of Laffer Associates, and Mr. Charles Qi of the Beijing Entry and Exit Immigration Service Association will deliver keynote speeches, and attendees will benefit from timely legislative analysis on the EB-5 Regional Center Program extension. CONTINUE READING →

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08 February 2016

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Hotel Lawyer in Los Angeles at the latest EB-5 Summit

If you have been thinking about tapping into EB-5 financing for your development project, this is the time to make your decision and act quickly. If you need background on what the EB-5 program is about, how it has gone mainstream with institutional investors for several years, and is now providing a steady stream of reliable capital, please see the articles referenced at the bottom.

We think that JMBM’s Global Hospitality Group® EB-5 financing team has a pretty good perspective on the opportunity, the risks, and how to get clean execution. We have closed more than $1.5 billion of EB-5 financing and sourced more than half of that for our clients.

If you have missed our reporting of key events affecting the availability of EB-5 financing here, you need to know that the EB-5 program was extended for another year through September 30, 2016 without any changes. But just as the maximum number of visas has been reached in each of the past two years, the experts expect that we will “cap out” at the maximum 10,000 visas even earlier in 2016 – possibly as early as May or June.

And the “reformers” are still out there, with proposals to revise the EB-5 program the next time it comes up for renewal. So this is a great time to move into action while EB-5 financing continues to be accessible for top developers with great projects and a strong track record.

We are confident that most people who delay will wish they had started earlier and gotten in on this great source of relatively inexpensive financing early in the game. CONTINUE READING →

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18 December 2015

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Hotel lawyer with great news for developers: the EB-5 immigrant visa financing program has been renewed — approved by Congress and signed by the President. It is being continued without change through September 30, 2016.

JMBM’s team has closed more than $1.5 billion of EB-5 financing and sourced more than half of that for our clients

A funny thing happened on the way to the 2016 Federal budget approval last week. One of the “riders” to the omnibus appropriations bill was the EB-5 legislation sponsored by Senators Leahy and Grassley. For months preceding the scheduled Congressional action, many stakeholders in the EB-5 industry spent untold hours in negotiating complex provisions to deal with certain concerns regarding the program. These negotiations resulted in multiple drafts of the proposed legislation being exchanged between Congressional staff and industry leaders, with the “final” draft receiving the unanimous approval of the trade organization for regional centers, the Invest in the USA or IIUSA. It was a good compromise on many knotty issues.

Then at the proverbial 11th hour . . . on Wednesday, December 16, the elaborate “final” compromise proposal was jettisoned in favor of a simple extension of the expiration date for the Regional Center program to September 30, 2016, without any other changes to the program.

The EB-5 regional center program is extended without any other changes.

Yes. That is right. After all the discussions and proposals, THE ONLY CHANGE IN THE LAW IS AN EXTENSION OF THE EFFECTIVE DATE FOR THE PROGRAM THROUGH NEXT YEAR.

Now, as the program has been renewed without a single change, lenders and foreign investors are now rushing to fill the pipeline again. And it is much more desirable to be at the front of the line, rather than at the back of the line.

Nothing was done about any other issues, including the following: CONTINUE READING →

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08 December 2015

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Editor’s note: The EB-5 program has been renewed! The article below describes the changes to the EB-5 Immigrant Investor Visa program that were ALMOST enacted in December 2015. At the eleventh hour, Congress completely shelved all the proposals discussed below, and instead decided to continue the program, without any change, through September 15, 2016. 

Hotel Lawyer preview of the new EB-5 financing rules.

Although minor tweaks and adjustments continue to be made to legislation in the final hours before Congress votes, it looks like we have a pretty good idea of what the new rules will be for EB-5 financing. Top takeaways for developers are:

  • The EB-5 regional center program will be extended for 5 years
  • Developers will be able to raise 60% more EB-5 capital on the same number of jobs
  • Minimum investment will be raised to $800,000 (not expected to deter investors)
  • TEAs will be forced into a “modified California model” of not more than 12 contiguous tracts
  • NOW is a good time to get started on EB-5 financing before the New Year rush
  • There will be much greater scrutiny and compliance required of those in the capital raising process, and there may be a trickle-down effect on developers (unless they want to form and use their own regional center)

Read on for more details. CONTINUE READING →

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02 October 2015

We are pleased that the Continuing Resolution passed by Congress yesterday includes a temporary extension of the EB-5 Regional Center Program. This extension allows the program to continue generating foreign direct investment and creating U.S. jobs through December 11, 2015.

In addition to extending the current program to December 11, this will also provide additional time for Congress to consider a long-term reauthorization bill that would include reform measures to strengthen federal oversight and the integrity of the program. Members of Congress from both parties and both the House and Senate are negotiating in good faith.

This week, two Senate bills were introduced that propose revisions to the EB-5 program.

Last week, our team closed $350 million in EB-5 financing for our developer clients. We have closed more than $1.5 billion of EB-5 financing and sourced more than half of that for our clients and believe the EB-5 program will continue to be an important source of funding for qualified projects.

We will continue to report on EB-5 developments as they unfold. CONTINUE READING →

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21 September 2015

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The Global Hospitality Group® is best known for its expertise in connection with hotels and resorts. We also have an active restaurant practice, and like a hotel, a restaurant is an operating business integrally intertwined with special purpose real estate. We frequently advise restaurant owners and operators on labor and employment, ADA, management, and finance and licensing issues, and we have a particular expertise relating to celebrity chef deals.

Senior Global Hospitality Group® member David Sudeck recently participated in a roundtable discussion about the food and beverage industry in Los Angeles, published in the Los Angeles Business Journal. The following discussion about licensing issues, EB-5 and crowdfunding investment in restaurant projects, gift card and loyalty programs and tax planning strategies is based on the roundtable and includes some clarifications and updates.

 

The Food & Beverage Industry in Los Angeles: A Roundtable Discussion
Supplement to the Los Angeles Business Journal

The food and beverage industry is unique in many ways. And here in Los Angeles, where we have some of the best dining and food-for-purchase options in the nation, there may be an even more finely tuned set of rules for success. Stir in an unpredictable economy and you’ve got a sector of Southern California business that continues to evolve faster than most. To make some sense of this exciting and unpredictable realm, the Los Angeles Business Journal turned to some of the leading experts in the region – from the financial, legal and business perspectives – to get their diverse insights and assessments regarding the current state of the industry that Angelenos most certainly couldn’t live without!

CONTINUE READING →

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09 September 2015

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Editor’s note: The EB-5 program has been renewed! Congress completely shelved all the proposals discussed below, and instead decided to continue the program, without any change, through September 15, 2016. 

For the current status of the EB-5 financing program, see “EB-5 Immigrant Visa program extension signed into law — without any changes. EB-5 financing continues for new development projects.“

EB-5 is at a critical renewal point

The next 3 weeks are going to be crucial for the EB-5 industry as the current legislation sunsets on September 30, 2015. While the consensus is that this important program will be renewed, and perhaps made permanent, there are lots of currents circulating about possible changes in the program.

We want to share with you some keen insights we recently received.

EB-5 update and insights from an industry insider

Below is the full text of a letter recently sent to industry colleagues by Pat Hogan, President, CMB. Pat is one of the leading proponents of EB-5, and is also a founder and board member of the IIUSA (Invest In the USA) which is the national industry trade association for the EB-5 Regional Center Program.

Greetings,

I wanted to share my thoughts with you after having recently visited no less than 60 Congressional and Senatorial offices within the last 40 days. I also just attended the American Immigration Lawyers Association (AILA) EB-5 Investors Summit this past weekend in Las Vegas.

CONTINUE READING →

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28 January 2015

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This article was first published by EB5Investors.com on January 28, 2015.

 

Polis Bill Reform EB-5 Immigrant Investor Program

With the regional center program set to expire in September 2015, the EB-5 industry has been given new life in the form of the American Entrepreneurship and Investment Act of 2015. The Act was introduced today by Congressmen Jared Polis (CO-02) and Mark Amodei (NV-02), and is a follow-up to last year’s bill of the same name. The bill would make the regional center program permanent and allow for continued job creation and a more reliable stream of foreign capital.

“Our nation has always been at its strongest when we attracted the best and brightest minds to help build and invest in our economy,” said Rep. Polis. “The EB-5 visa program is an important tool that brings innovation and investment to the United States, and this bipartisan bill will improve and make permanent the program so that foreign investment and talent will continue to flow into our businesses, and strengthen our economy.”

“This bi-partisan, pro-investment, pro-growth and pro-jobs bill is one piece of the legislative solution to reform legal immigration,” said Rep. Amodei. “As stated in Article I, Section 8, Clause 4 of the Constitution, ‘The Congress shall have power to… establish a uniform rule of naturalization.’ That is a responsibility we owe the country to take seriously.”

The legislation makes several much-needed improvements, most notably making the regional center program permanent. It also creates new designations for Targeted Employment Areas, and leaves those designations up to the state’s discretion. CONTINUE READING →

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11 January 2015

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JMBM is a Platinum Sponsor of the EB-5 Investors Conference in Las Vegas on January 17, 2015 and will moderate and talk about EB-5 for hotel development

JMBM’s Global Hospitality Group® is pleased to be a Platinum sponsor of the upcoming EB-5 Investors Conference at the Wynn Encore Resort in Las Vegas on January 17, 2015. This is one of the premier conferences on this subject in the entire United States.

Partner, Jonathan Bloch and I will moderate and participate in a panel on Hotel Development – Jonathan as a speaker, and myself as a moderator. In addition, JMBM’s Global Hospitality Group® Vice Chairman, Guy Maisnik and Partner, David Sudeck will be attending to meet with potential clients and friend to help explore this opportunity.

Our panel on EB-5 for Hotel Development will be from 11:30 am to 12:30 pm on Saturday, January 17, 2015. We hope you will join us for our session and reach out to us if you would like to get together to explore the EB-5 financing opportunity. We are able to help qualified premier developers source low-cost EB-5 financing for their project.

Why EB-5 and this Conference?

EB-5 financing is being used widely by some of the largest owners of hotels and restaurants, and we will be discussing how developers are taking advantage of this capital. EB-5 financing has provided developers with low-cost, non-recourse, five to six year financing for construction and development of new projects.

Whether you are new to EB-5 financing or have used it in the past, this one-day conference has something for everyone. CONTINUE READING →

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7 September 2014

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EB-5 Visas and China “Retrogression” – What’s it all about?

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Jim Butler and Jonathan Bloch
Partners, Jeffer Mangels Butler & Mitchell LLP

In the past, when China exceeded its 7% allocation of US Immigrant Investor Visas (EB-5 visas), Chinese applicants were permitted to take advantage of unused EB-5 visas allotted to other countries. But as of the last week of August 2014, the US State Department decided that the issuance of new EB-5 visas to Chinese applicants will be frozen or “retrogress” (move backward) until October 1, 2014, when the new fiscal year starts.

At that time, a new visa quota of 10,000 EB-5 visas (for all countries) will become available for the next fiscal year through September 30, 2015. China will again be allotted only 7% of these visas but most experts expect that Chinese investors will be permitted to access visas unused by other countries in accordance with practice over the past 3 years. This means that the 10,000 visa cut-off date likely will be reached much earlier in the fiscal year ending September 30, 2015, and this may significantly affect fundraising in 2014 and 2015.

EB-5 Visas and China “Retrogression” – What it means to you

If you have a new hotel development in the pipeline and you are on the fence about EB-5 financing, now is the time to act!

Why should this latest development in EB-5 financing concern you — a mere 5 week “freeze” on the issuance of EB-5 investment visas for China? If you want to use EB-5 financing as part of your capital stack for a project in 2015, it should concern you plenty for the following reasons:

  • China has been the dominant source of EB-5 capital for the last 3 years — more than a staggering 70% of EB-5 visa applications.
  • The freeze will only affect immigrants filing I-526 applications who are born in Mainland China. Of course, over time, other countries may fill any shortfall of investors from Mainland China but that may take 2-3 years or longer to develop the EB-5 infrastructure that makes foreigners aware of the program, motivates them to immigrate to the US and provides  EB-5 “capital delivery” system (marketing agents, immigration attorneys and the like) that can match China.
  • Anything that delays, retrogresses, or threatens the certainty of EB-5 financing from China creates uncertainty that is bad for all participants in the EB-5 financing world — the Chinese investors, US developers, and the communities that benefit from the realization of new projects, new jobs for US citizens, and economic stimulus.
  • If the EB-5 issues are not fixed quickly, an irreplaceable source of financing could be lost for US developers, communities may lose the benefit of major new projects (from hotels to conference centers and port facilities), Americans will forfeit hundreds of thousands of new jobs each year, and we will lose a critical source of highly-educated, wealthy immigrant talent as America faces a critical labor shortage of skilled workers in the near future.

Based on our experience of assisting developers with EB-5 financing for more than 60 projects, we are confident that there are both short term and longer term solutions to these problems which are discussed at the end of this article. But first, we need to recap the background and setting for the EB-5 program. CONTINUE READING →

Contact Information
Jim Butler, Chairman
Global Hospitality Group®
Jeffer Mangels Butler & Mitchell LLP
(310) 201-3526 • jbutler@jmbm.com
www.HotelLawyer.com

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