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ILW.COM EB-5 Blog

How To Set Up A Regional Center

Rating: 4 votes, 5.00 average.

The Regional Center approach to EB-5 investment has become
quite popular over the last few years. It is made available within the two
options offered by the United States government for foreign nationals to obtain
permanent residency visas, or green cards, through domestic commercial
investment.  The two paths to permanent
residency differ mainly in terms of the amount invested by a foreign
entrepreneur.


For example, an investor from overseas can invest $1,000,000
in a commercial enterprise anywhere in the U.S., and if that investment leads directly
to the creation of 10 permanent full-time jobs, he or she will be eligible for
a green card.  In fact, once an
investment has been made and signed off by the government, the foreign investor
will be given a conditional or temporary visa that permits the investor and his
or her immediate family to enter the United States.  If the commercial enterprise in which the
investment was made creates 10 jobs within two years, the investor can petition
the government to have the conditions on his or her visa removed, thereby
converting it into a permanent visa.


An immigrant entrepreneur can also invest $500,000 in a
commercial enterprise that is located in a Targeted Employment Area.  A Targeted Employment Area is generally
defined as a rural area or an area that is experiencing 150% of the national
unemployment rate.  The same direct
job-creation requirements apply to such an investment.


The Regional Center Pilot Program encourages foreign entrepreneurs
who are seeking an EB-5 visa to create investment vehicles or entities that can
develop and manage a commercial enterprise. 
Such an arrangement can be entirely public or private in nature, or a
mix of both.  For example, an investor
(or group of investors) can apply for Regional Center designation for a group,
organization or agency - any kind of investment and development entity - that
they have set up specifically for the purpose of attracting capital and
developing commercial projects within the EB-5 category. 


Gaining approval for an EB-5
Regional Center
is a multi-step process that begins with the investment
itself.  The foreign investor must also describe
the strategy that will be used to develop and promote a project, how additional
funding will be secured if needed, how many jobs will be created (and in what
sectors), and economic analyses showing the potential economic impact of the
commercial enterprise that will be managed by the Regional Center.  The foreign investor, basically, must present
the government with money and a sound business plan; only then will a proposed Regional
Center gain official recognition.


After the Regional Center designation has been awarded, it
is up to the investor(s) to ensure that the commercial enterprise is developing
on schedule and generating jobs.  If the
project is not meeting the requirements of the program, particularly with
respect to job creation, the Regional Center designation can be revoked.


It is easy to see why the Regional Center approach is so
popular among immigrant entrepreneurs: Regional Centers can pool an unlimited
amount from foreign investors, they are generally efficiently managed by
U.S.-based developers with experience in commercial development, they can be
located anywhere (unless the investment amount is $500,000, in which case it
must be located in a Targeted Employment Area), and the job creation
requirements are a bit more relaxed. 
That is because a Regional Center can also use jobs created indirectly (such as jobs created at a
restaurant that opened or expanded alongside the EB-5 enterprise) as a result
of the investment to satisfy the job creation requirement. 


For that reason, Regional Centers are becoming increasingly
popular among wealthy foreign investors, and the trend is likely to continue in
the coming years.


For current news and changes on EB-5 follow Eb5 Investors at www.facebook.com/Eb5Investors.

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