Monday, May 18, 2015

Why examination of future viability of EB-5 projects is very important

Future viability is a concept -- and a concern -- I would like to bring to the EB-5 world.  My friend Michael Gibson's latest report on EB-5 projects around the nation is disturbing and troubling because so many of them are failing or are wrapped up in lawsuits and doing nothing, least of all job creation.
Future viability of EB-5 projects is something I have been thinking about for a long time.  If I've said it once, I've said it a thousand times:  "The first step you take in developing an EB-5 project puts you on the road to success or failure."
And so many are failing.  But we don't see the failures, usually, until the projects are three or four years old, sometimes sooner, sometimes later.
To say that you need to be forward-leaning when considering an EB-5 investment project is probably an understatement.  My regional center decided many years ago not to adopt an EB-5 project that produces a product or provides a service that people don't absolutely have to have.  This rule has served ACFI well.
We are engaged in assisted-living projects and manufacturers of hurricane-, tornado-, seismic-, and fire- resistant modular homes made from steel and hardy plank.  Insurance companies and the Federal Emergency Management Agency (FEMA) are driving the latter industry.
Unfortunately, I think you will see many more failures of EB-5 projects and regional centers.  There is a lack of judgment out there that dooms some EB-5 projects before they even get started.

Wednesday, April 15, 2015

Why the cutoff date problem for Chinese EB-5 investors?

Because Congress never intended immigrant investor visas to go to immediate relatives (normally spouse and children younger than 21).
Now we have a cutoff date of May 1, 2013, because the Department of State has been allocating a large number of EB-5 visas to spouses and children of EB-5 investors.  It's that simple.

Monday, April 13, 2015

Cutoff date appears for Chinese EB-5 visa petitioners for first time

I predicted late last year that the U.S. Department of State would issue a cutoff date for EB-5 visa petitioners from China sometime this spring.  The department did not disappoint.
The May Visa Bulletin establishes a cutoff date for Chinese EB-5 petitioners of May 1, 2013.
What does this mean?  According to the Visa Bulletin:
"Heavy applicant demand has required the implementation of an Employment Fifth preference cut-off date to hold number use within the maximum level of numbers which may be made available for use by such applicants during FY-2015. No specific prediction regarding movement of this date is possible at present. Future visa availability will depend on a combination of demand for numbers being reported each month, and the extent to which otherwise unused numbers may become available. An increase in visa demand by applicants with relatively early priority dates COULD make necessary a retrogression of this cut-off date prior to the end of the fiscal year; retrogression is NOT being predicted but it cannot be ruled out. It is extremely likely that this category will remain subject to a cut-off date indefinitely."
So, suddenly there are no EB-5 visas for Chinese who filed their I-526 petitions after May 1, 2013!
I am afraid the nightmare scenario is here.

Friday, September 5, 2014

There are a few bad apples in any EB-5 barrel

See:

http://www.sec.gov/litigation/litreleases/2014/lr23077.htm

Thursday, August 28, 2014

EB-5 visas for Chinese likely will see delays in availability in FY2015

While the Visa Bulletin shows that EB-5 immigrant visas are "current" for September, it is widely believed that this immigrant visa category will "retrogress" and that there will be delays in availability of EB-5 immigrant visas for Chinese in federal Fiscal Year 2015, which begins October 1.
No one knows how long the delay -- when it occurs -- will be.  During the first few months of the fiscal year, I would guess that there will be no delays.  But as we get further into the fiscal year, I expect to see delays in availability of a few months.

Thursday, July 24, 2014

Fortune slams EB-5 Program

See:

http://tinyurl.com/pwt886u

This is a hatchet job, in my humble opinion.  Where there is a lot of money, you will find some scam artists and charlatans and just plain crooks.

Thursday, March 27, 2014