with other projects, the stronger the project is as it
relates to this criterion within the category, the higher
its corresponding rating.
The ultimate score for each categor y would be the
summation of the product of the weight and rating across
each criterion. Investors could use a 0-10 weighting and
rating system respectively.
WHAT SHOULD EB-5 INVESTORS
THINK ABOUT WHEN SELECTING
PROJECTS?
There are four basic categories of concerns that investors
should consider before proceeding with a deeper dive into
the due diligence process. These are:
A. JOB CREATION:
Will the projects create enough jobs so the investors
will not only get the conditional green card but the
conditions on their green card will be removed.
return policies of the regional centers and read the
private placement memorandum conditions of capital
pay bac k c a refull y. If th e re a re re tro g ressio n a n d /
or redeployment considerations, they need to make
sure that what they read is realities they can handle.
D. AMOUNT OF RETURN OF CAPITAL INVESTMENT:
What will the return on the investment be? Now that the
investment amounts have been increased substantially, and
the adjudication periods have lengthened quite significantly,
the return on the investment or at least on the redeployment
of the initial investment can no longer be ignored.
WHAT TO CONSIDER BEFORE
STARTING THE DUE DILIGENCE
Before elaborating on the above four categories, there are
some basic questions that should be answered before the
formal due diligence analysis starts.
• What is the administrative fee for the project that
needs to be paid to the regional center?
B. RETURN OF INVESTMENT:
Will EB -5 investors get their capital investment
b a c k ? To e n s u r e t h i s i s t h e c a s e , t h e i n v e s t o r s
have to per form some basic and some rigorous
analysis of the regional centers and the developers. • Is there any risk of being asked for additional capital
payments in the form of capital calls?
C. TIMING OF REPAYMENT:
What will the timing of payment of the capital
investment be? Investors have to study the capital • Is there an economic repor t in place? Who has
prepared the report?
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EB5 INVESTORS M AGAZINE
• Is there any senior loan in the transaction? By whom?
Is it committed? Is it already disbursed?
• Are all the permits to commence construction in place?