What is an EB-5 Regional Center Designation?
All EB-5 regional centers are designated and approved by the United States Citizenship and Immigration Services (USCIS). Regional centers are approved to make EB-5 investments within a specific geographic area, and this designation is assigned to a specific business entity that owns and operates the regional center.
A new EB-5 regional center can be created under the USCIS Immigrant Investor Pilot program by filing an I-924 regional center designation application. EB-5 regional center applications can be filed by any commercial business entities (partnerships, limited liability companies, C-corporations, etc.), and USCIS does not restrict the types of projects an approved regional center can invest in in its approved geographic area.
The freedom to make EB-5 investments across the entire spectrum of investment opportunities and the ability to pool direct, indirect, and induced job creation are two primary reasons most EB-5 investors prefer investments sponsored by regional centers.
How to Apply for EB-5 Regional Center Status
Below is a detailed, step-by-step guide on how to successfully apply for and become a new USCIS-approved EB-5 regional center.
Step 1: Define the Scope of the Regional Center
As potential owner and operator, you must determine the geographic scope of your regional center and what types of projects your regional center will invest in. Key details must include the location of the future EB-5 investment projects, the proposed business model(s), estimated required investment amounts, and the amount of total capital needed for the project (both EB-5 capital and other sources of investment capital).
You must clearly define the scope of activities of the regional center and assemble a clear and compliant regional center operational plan. The purpose of this plan is to demonstrate that if approved, you will be able to successfully operate an EB-5 regional center in compliance with USCIS rules and regulations.
Step 2: Hire the Right EB-5 Regional Center Application Team
Once you have decided to move forward with the submission of an EB-5 regional center application, the next step is to select an EB-5 team of professionals to work with. Suitable professional support is crucial, as this team will assemble all the required components of the EB-5 regional center application for approval by USCIS. When deciding between the many vendors, consultants, and attorneys operating in the EB-5 space, carefully consider who would be the best fit for your specific needs.
Usually, regional center applicants take one of two approaches when choosing a team of EB-5 professionals: (i) they hire multiple, separate companies and/or attorneys to independently complete each of the major required components and then assemble the final EB-5 application themselves, hoping that all the numbers match and that the various legal documents and business plans tie together correctly, or (ii) they work with a single EB-5 consulting firm, like EB5AN. We can complete the entire EB-5 regional center application in-house within three weeks.
Working with the best team of EB-5 professionals will help you tailor your EB-5 regional center application to your needs as a project sponsor and will get your new EB-5 regional center approved in the shortest period possible.
Below is a list of the key components required as part of a new EB-5 regional center designation application.
- Immigration documents: These documents include a cover letter to USCIS requesting designation as a new EB-5 regional center under the Immigrant Investor Pilot Program and a completed Form I-924—the USCIS form required to set up a new EB-5 regional center.
- Targeted employment area (TEA) designation: A TEA is defined as a rural area or an area with an unemployment rate that is at least 150% of the national average. Most EB-5 investments take place in these areas, so it is important to identify TEAs covered by the regional center’s geographic scope. (Our free TEA Map shows existing TEAs throughout the United States.) The benefit of investing in projects within TEAs is that the minimum investment amount is lower per investor ($900,000 instead of $1,800,000), which makes investments more marketable. The Department of Home Affairs oversees TEA designation.
- Securities documents: An EB-5 regional center application should include a set of securities documents that demonstrate how the EB-5 regional center will structure and administer future EB-5 projects within its target geographic area.
- Business plan: A key part of the EB-5 regional center application is a business plan that is Matter of Ho compliant with USCIS standards, as required by law. This business plan will need to include projected costs and revenues, the exit strategy, market research, competitor analysis information, and so on for the proposed business investment.
- Job creation report: An EB-5 compliant job report demonstrates how the business described in the EB-5 business plan will create jobs within the regional center’s target geographic area. This job report should include specific job calculations for how many jobs the EB-5 project will create if successful, and over what period of time. The report should include all direct, indirect, and induced jobs created as a result of the successful development of the EB-5 project.
Step 3: Complete and File Your I-924 Form and Supporting Application Documents to Set Up a New EB-5 Regional Center
The entire process of assembling your EB-5 regional center application can take anywhere from three weeks to several months depending on what team of EB-5 professionals you choose to engage.
At a minimum, an EB-5 regional center application must have an EB-5 compliant business plan, a comprehensive job creation report that meets USCIS requirements, a completed I-924 form, and the appropriate supporting legal documentation. These legal documents include a regional center operating plan and evidence of sufficient capital to operate the regional center in compliance with USCIS requirements.
Once the application is completed, you must sign a set of hardcopy application binders with original ink signatures. Then, the completed set of application binders, including the signed I-924 form and a check in the amount of $17,795 (the filing fee) made out to “U.S. Department of Homeland Security,” must be mailed to the USCIS EB-5 processing unit for new I-924 applications. The appropriate USCIS mailing address for new I-924 applications is listed below.
U.S. Citizenship and Immigration Services
California Service Center
Attn: EB-5 Processing Unit
24000 Avila Road, 2nd Floor
Laguna Niguel, CA 92677
Once the new EB-5 regional center application is approved, your regional center may begin to receive EB-5 capital for projects located within the approved geographic area. Currently, the average approval time for regional center applications from USCIS is approximately 12 months; however, EB5AN new EB-5 regional center applications have historically been approved in about seven months.
The I-924 application package includes many supporting documents, which vary depending on each applicant’s individual circumstances.
At a minimum, an I-924 application package should include the following four components:
Component #1: Proof that the regional center will create a minimum of 10 full-time jobs that will last a minimum of two years for each EB-5 investor who invests in the proposed business.
Select forms of evidence may include the following:
- A detailed and compliant Matter of Ho business plan
- An economic job report showing how many jobs will be created and over what period of time the job creation will occur
- SEC/offering documents, including the subscription agreement, private placement memorandum (PPM), investor due diligence questionnaire(s), accredited investor questionnaire(s), W-8BEN-E, etc.
- Loan or investment documents reflecting the relationship between the new commercial enterprise (NCE) and the job creation enterprise (JCE)
- Limited partnership, limited liability company, or C-corp operating agreement for the EB-5 NCE business entity and the entity that will own and operate the new EB-5 regional center
- Detailed and credible financial pro-formas, including projected project costs and revenues demonstrating how the funds will be invested and returned to investors (exit strategy)
Component #2: Documented supporting evidence that the regional center will be able to meet the ongoing operational requirements of the EB-5 program.
Select forms of evidence may include the following:
- Articles of incorporation
- Federal Employer Identification Number (FEIN) letter from the IRS
- Escrow agreement
- Drafts of all related contracts
- Bank statements showing sufficient operational capital
Component #3: A detailed plan of all proposed EB-5 project promotional activities of the regional center.
Select forms of evidence may include the following:
- Evidence of funds planned for marketing and promotion
- Detailed, line-by-line budget and timeline
- Evidence demonstrating the lawful sources of the regional center’s operational and investment capital
- A complete and detailed plan for all marketing operations of the regional center
Component #4: A county map and list of all counties showing the exact geographic coverage of the proposed regional center designation
Avoid USCIS Requests for Additional Information
Since USCIS has the right to ask for additional information from any new EB-5 regional center applicant, it is crucial to submit a high-quality application that addresses all potential questions a USCIS adjudicator may have about the proposed new regional center. Responding to a USCIS Request for Evidence (RFE) can take several weeks, and the processing time from USCIS for each RFE can be several months, so it is best to try to minimize the odds of receiving an RFE by assembling a high-quality initial application. Additionally, you are less likely to receive an RFE if you submit business plans and a job creation methodology that has been previously reviewed and approved by USCIS.