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.