The impacts of COVID-19 on the global economy and the changes to day-to-day life on the planet – from social connections and health care to employment and how, when, and where we travel – are topics of conversation at every table. But, as we do in the face of every crisis, the world continues to adapt. In our personal spaces, we work from home and attend class by Zoom. We stick to online shopping and wear masks when we have to go out.
Likewise, affected industries everywhere have made necessary adjustments, too. A downtick in transportation and hospitality reservations is balanced by the uptick in merchant fulfilment centers, their distribution channels, and medical equipment manufacturing. E-commerce businesses and the industries that support it are booming. And savvy investors see the opportunity. Many are wondering if consumer purchasing habits are likely to be altered permanently by the pandemic.
What does that mean exactly for the EB-5 industry? How can prospective EB5 investment participants tailor their decisions to a quickly and ever-changing U.S. market? Let’s take a cue from current EB-5 investors who are achieving success even during a global pandemic, but first, let’s dive into a brief industry review of 2020.
Redefining EB-5 Operations for Recovery
At the forefront of global markets impacted by COVID-19 crisis are hospitality, retail, and tourism. All three of these industries are a big part of EB-5 Regional Center investment offerings across the United States. Although specific effects vary greatly by project, EB-5 investors on the whole have not been immune to the weight of the pandemic. However, there are clear benefits to immigrating post-COVID-19.
Business Survival Depends on Adaptability
Regional centers and NCE operators have been left scrambling in the face of government and public health mandates to redefine their operations before it’s too late to recover. Many have been forced to delay their plans or shutter their operations for good. The projects that have managed to stick it out have largely done so by making bold and nimble moves, shifting revenue streams from brick-and-mortar to the digital space.
The Shift from Brick-and-Mortar to Digital
Online business has been a true lifeline for adapting businesses, and we’ve seen more than significant growth in the e-commerce industry. The sharp increase in consumer demand for the at-home delivery of everything from groceries to automobiles has consequently driven demand for investment in current-market inventory and the logistics and distribution business sectors.
As custodians of EB5 investment participants’ capital and program eligibility, the EB-5 Regional Centers that remain in operation are diligently working to adapt to market changes while continuing to connect the right project operators with the right immigrant investors.
Basic EB-5 Investment Requirements
There are four basic requirements for successfully obtaining a green card through the EB-5 visa program:
- Applicants must make a minimum capital investment of $1.8 million (or a reduced investment amount of $900,000 in a rural or high-unemployment area designated as a targeted employment area, abbreviated TEA).
- Capital must be infused into a program-approved new commercial enterprise (NCE) or a qualified distressed business.
- The EB-5 investment must preserve or create a minimum of 10 full-time employment positions for U.S. workers that remain viable for a minimum of two years.
- Lawfully-sourced EB5 investment capital must remain at-risk for the entirety of the investment period.
To avoid (or at least partially quell) the trepidations the fluctuating markets can spur on, many prospective EB-5 investors are choosing experienced industry professionals to counsel them throughout the investment process and best ensure their EB-5 immigration success.
EB-5 Investors Choose Experienced Partnerships for Success
EB-5 networks historically offer investment opportunities across a variety of market sectors. This diversification strategy has been valuable for both aligning with the diversity of client rosters and their individual goals as well as for ensuring the security of the capital they bring to the table. Taking advantage of market trends in this manner provides EB5 investment opportunities that offer greater likelihood for successfully obtaining an EB-5 visa as well as the greatest chances at financial success.
Although the circumstances surrounding the current pandemic have been rather unprecedented, if you step back and take a bigger-picture view, it is easy to see that this strategy still holds strong in the face of challenges brought on by COVID-19. The way EB5 Affiliate Network (EB5AN) operates, for instance, hasn’t changed. Our primary goal is still to ensure our clients’ pursuit of permanent residency in the United States, and the projects we elect to present are ones that we are confident will meet (and maintain) all eligibility requirements of the EB-5 Immigrant Investor Program.
Equally important, our next priority is to ensure the security of our investors’ capital. Seeking out projects in sectors that are running strong and projected to continue that way is an obvious choice for EB5AN. For example, more straightforward investment opportunities may involve the creation of at least 10 new jobs at the outset of an project. Or, in riskier opportunities, job creation may depend upon operation of a facility once it’s been constructed.
In either situation, rest assured our team of experienced EB-5 industry professionals will make recommendations based on sound market research and forward-minded analysis. To learn more about how EB5AN helps prospective EB5 investment participants navigate the uncertainties of a post-pandemic immigration scenario, don’t hesitate to reach out!