EB-5 & EB-6 Visas
Investing in the “American Dream”
Steven H. Podolsky, SIOR, Principal
The EB-5 Immigrant Investor Program, created by The U.S. Congress in 1990, grants green cards to immigrants who invest money in the United States. The investment must be at least $1 million (or $500,000 in high unemployment or rural areas) and produce or protect a minimum of 10 full time jobs for U.S. workers. The investment money is typically used for secondary, short-term debt to developers of real estate projects.
The investor and their dependents are awarded a temporary visa residency for two years. When the two years expire the investor may apply for a permanent residency green card. The investor’s priorities are the temporary visa, the permanent green card, return of their investment money and a small return on the investment, in that order.
The number of EB-5 visas granted has more than tripled over the past three years, from 3,340 in 2011 to 10,692 in 2014. In 2013, 8,543 EB-5 visas were issued, producing 31,000 jobs and $1.5 billion in profit for the U.S. The current waiting period to obtain a temporary visa is 17 months.
Congress is currently reviewing an expansion of the EB-5 program – the aptly named EB-6 – which would be made available to the thousands of EB-5 applicants who have not been granted visas. The EB-6 bill contains a different set requirements from the EB-5. For instance, while a $1 million investment is still mandatory, only five jobs must be created to obtain a two-year conditional permanent residency.
Furthermore, the EB-6 draws specific distinctions in eligibility guidelines between investor types, such as Venture Capital-Backed Entrepreneurs vs. Self-Sponsored Entrepreneurs, and may even include an option for those looking for temporary residency only. For non-permanent stay, investors may obtain a three-year non-immigrant visa with an investment of $100,000 in a U.S. company or creating three jobs and annual revenues to exceed $250,000 for two consecutive years.
There are currently at least two versions of EB-6 language being considered by Congress. EB-6 likely will not be approved in any form before the current December 11, 2015 expiration of the EB-5 program. EB-5 experts believe Congress will vote to extend EB-5 for another year.
- The EB-5 Visa continues to gain popularity: In 2014 the number of EB-5 visas granted reached a record high of 10,692.
- The Real Estate industry benefits from EB-5 Visas: Low interest rates and no personal guarantees are selling points to developers.
- The EB-6 Visa will ensure the program’s continuation: The EB-6 Visa will allow a more diverse range of investors and investment types, allowing a wider variety of applicants the opportunity to obtain residency.