be generated in the market . By examining the market size , growth rate , competitive landscape , and financial projections , investors can assess the profitability of the business .
By carefully evaluating the market analysis and feasibility portions of the business plan , investors can make informed decisions as to the likelihood of success over the lengthy EB-5 investment period .
4 . JOB CREATION
While the core of the job creation analysis will be found in the economic analysis , the EB-5 business plan should include a dedicated section that outlines job creation , specifying the total number of jobs the project will generate . For investors to receive a green card , the project in which they invest must generate a minimum of ten full-time jobs per investor .
JOB BUFFER : As a measure of security for the investor , strong projects often incorporate a job buffer . Though not required by USCIS , a job buffer is an industry standard when assessing projects for job creation security . It is now common for projects to have a minimum job buffer of 20 percent or higher , with some even reaching 30-50 percent or more .
appraiser that includes a valuation has a much higher level of credibility than merely a market study because of the level of due diligence , analytical rigor , and potential liability associated with the findings . An appraisal will also provide clarity on the amount of equity already in the project based on the as-is valuation as well as the at-stabilization valuation which can be helpful in determining the relative safety of the EB-5 investment in the project .
COMPETITIVE ADVANTAGE : Investors must ascertain whether the business plan outlines a compelling competitive advantage that sets the venture apart from existing players . The market analysis section of the business plan provides an opportunity to assess competitors ' strengths and weaknesses , identify market gaps , and evaluate the proposed business ' s positioning strategy . Investors can gauge the uniqueness of the product or service , the feasibility of capturing market share , and the sustainability of the competitive advantage .
PROFITABILITY : EB-5 investors will be looking for evidence that job creation from operations is likely to occur , and as such the business plan should contain a robust market analysis and feasibility discussion via a 3rd party that estimates the potential income that will
CONSTRUCTION JOBS : The business plan should provide some level of detail as to the breakdown of job creation across the various North American Industry Classification System industry ( NAICS ) codes . Jobs that are created through construction expenditures are generally considered safer than operational jobs because the likelihood of meeting the construction expenditure requirements is high . Development costs of a project rarely decrease , and unforeseen additional costs are common in the construction industry .
OPERATIONAL JOBS : On the other hand , operational jobs typically modeled using revenue are more variable , as the income required to create those jobs can be greatly influenced by market events , as has been witnessed in the hospitality market during Covid-19 . An EB-5 investor should look to calculate the job buffer as a percentage based on the ratio of construction to operational jobs generated by a project .
CONFIDENCE LEVELS : Projects that satisfy the tenjob requirement primarily through construction jobs , while utilizing operational jobs for the job buffer , provide a higher level of confidence than those heavily reliant on operational jobs to meet the minimum requirement . Moreover , a project that creates sufficient jobs through construction alone to fulfill the required job creation , with additional construction jobs to support a job buffer for each investor , is deemed highly robust . In some cases , projects that have incorporated bridge financing may have already satisfied their job requirements before EB-5 investment has been received . These projects are considered extremely safe to invest in , assuming
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