Under the EB5 investment program, investors have two main options: direct investment or investment through an EB5 regional center. Both options offer opportunities for obtaining a green card, but there are significant differences between the two. Here are the main difference between the two investment pathways:
EB5 Direct Investment
An EB5 direct investment is when an immigrant investor directly invests in and manages their own business in the United States. To qualify, an investor must invest a minimum of $1.05 million or $800,000 in a targeted employment area (TEA). The investment should create at least ten full-time jobs for U.S. workers. Direct investments can give investors more control and decision-making authority over their investment projects. Here are a few aspects that an investor may experience when they choose to make a direct investment:
Increased Investor Involvement
One of the most significant differences between direct and regional center investments is investors’ control over their businesses. With direct investment, you can make strategic project decisions, choose the location, and oversee the company’s or project’s day-to-day operations. This level of control allows investors to participate in their investments actively.
Project Customization
Direct investment gives flexibility and customization options for you as an investor. With direct investment, you can select any commercial enterprise that meets the EB5 program’s criteria. This flexibility allows you to pursue your business interests and apply any personal industry knowledge to increase your investment’s potential.
Direct Job Creation
Direct investors must create at least ten full-time jobs for U.S. workers to meet the EB5 program’s criteria. This requirement makes sure there is a direct impact on local employment and allows investors to contribute directly to the U.S. economy.
EB5 Regional Center
A regional center is a private or public entity designated by the United States Citizenship and Immigration Services (USCIS) that aids EB5 investments. Regional centers are pre-approved by the USCIS and focus on specific geographic regions or industries. Investing through a regional center can offer advantages that differ from those of direct investment. Here is what differentiates EB5 regional centers from direct investments:
Indirect Job Creation
One key benefit of investing through a regional center is the ability to rely on indirect job creation. Regional centers allow you to create direct and indirect jobs that count toward the requirement of the EB5 program. Indirect job creation includes jobs created by the economic activity generated by the EB5 investment project. These jobs may include positions within supplier businesses or construction-related employment opportunities.
Reduced Investor Involvement
When you invest through a regional center, you typically have a more indirect role in the investment project. A regional center can take on the responsibility of managing the project. Some of these responsibilities include job creation and reporting on compliance. When you choose to invest with an EB5 regional center, you and your family can live anywhere within the United States because of the reduced need for project involvement. If you prefer a more indirect approach, you may want to consider investing through an EB5 regional center.
TEA Investment Projects
TEAs are regions with higher unemployment rates or rural areas with lower population densities. Investments in TEAs qualify for a reduced investment amount of $800,000 instead of $1.05 million. Regional centers often focus on projects in TEAs, so you may have more opportunities to invest in a TEA if you choose to work with a regional center.
Regional Center Assistance
When you invest through a regional center, you can have those with experience guide you through the program. The EB5 investment program requires specific documentation to be filed according to a particular timeline. Regional centers have experience with the legal and financial processes of the EB5 program and can assist you with any questions you may have.
EB5 Investment Options
Choosing between an EB5 direct investment and a regional center depends on your circumstances, preferences, and investment goals. Direct investment offers more control, flexibility, and the opportunity to manage your investment. Investing through a regional center can offer the advantages of indirect job creation, reduced management responsibilities, and potential access to lower investment amounts with TEA projects. Contact an immigration attorney or regional center today for more information or help determining which investment option is right for you.