Foreign investors have two options when investing in an EB-5 project. They can either invest through a USCIS-designated regional center or invest directly in an EB-5 project.
The EB-5 investment amounts are either $800,000 or $1,050,000, depending on whether the investor invests in a rural, high-unemployment, or infrastructure project. These investments are directed into a New Commercial Enterprise (NCE), which serves as the channel through which the investment capital is provided to the qualifying projects. NCEs can take various forms, including real estate construction projects, hospitality businesses, technology startups, and more.
Control
In direct deals, only one direct investor is permitted. Unlike regional center investments, which involve pooling funds into an EB-5 project, direct or standalone investments require direct involvement in the management and supervision of the project. In direct EB-5 investments, pooling funds from multiple investors is not permitted. If there is more than one investor, the investment must be made through a regional center.
Standalone Investors on H-1B
H-1B visa holders are restricted from solely owning and managing an EB-5 project due to H-1B regulations, which confine individuals to employment with the sponsoring employers. To participate as a standalone investor while on H-1B, the standalone investor would need a U.S. citizen partner or H-4 partner on an EAD to help run the project.
Upon obtaining an EAD through the EB-5 petition, the investor can work for their own business, another employer, or both. However, utilizing the EB-5 EAD will terminate the H-1B status. To maintain H-1B employment, it is crucial to refrain from utilizing the EB-5 EAD.
Job Creation
Both types of investments must create at least ten full-time jobs. However, direct investments can only consider jobs directly created by the project to meet the program’s employment criteria. These positions typically involve tasks vital to the NCE’s daily operations and are listed on its payroll. Unlike direct employment, indirect and induced jobs are not created by the NCE itself. Instead, they result from a positive economic impact in the area surrounding the project.
Concurrent Filing
Until at least May 2024, investors from any country who invest in a rural, high unemployment, or infrastructure project have the option to concurrently file Form I-485 (Application to Adjust Status) along with either Form I-526E (Immigrant Petition by Regional Center Investor) or Form I-526 (Immigrant Petition by Standalone Investor). This is based on the May 2024 visa bulletin. Investors can also request an employment authorization document (EAD) and a travel document.
Upon approval of the application, the investor and their spouse and unmarried children under 21 born outside of the U.S. will be granted lawful permanent residency.
If you have any questions regarding the EB-5 process or how to make a direct investment, please email us at rpatel@patellegal.com and jtrevino@patellegal.com.
Authors: Rakesh Patel, Managing Partner and Jacqueline Trevino, Attorney