When applying to get a U.S. Green Card through the EB-5 program, you can choose to fulfill the investment requirements via a regional center or a direct investment. Foreign nationals opting for the regional center investment route must understand the importance of choosing the right one.

Also, knowing what to expect from the regional center will help you decide if the one you are considering is the best pick for your EB-5 journey. The regional center you select will influence the success of your investment.

In this article, we’ll explain what a regional center is and what it does. We’ll also suggest questions you should ask before partnering with one and key factors you should look out for.

What Is a Regional Center?

A regional center is a designated public or private economic unit in the U.S. that facilitates foreign investments aimed at boosting economic growth and creating jobs. These entities pool funds from different investors and use them to develop large-scale projects, typically in the real estate sector.

Regional centers usually offer two primary investment models. They include equity investments, where investors hold ownership stakes in the project, and loan-based models, where the regional center lends pooled funds to developers with the promise of returns. Also, a key advantage of investing through a regional center is the ability to count both direct and indirect job creation, facilitating the fulfillment of this EB-5 program requirement.

Regional centers operate by establishing new commercial enterprises (NCEs) that act as vehicles for EB-5 investments. These NCEs are structured to meet the job creation requirements set by USCIS, ensuring that each investor’s funds contribute to creating at least 10 full-time jobs.

Regional centers manage the entire process, reducing the operational burden on foreign investors. This model allows investors to participate in projects with the potential for higher returns while also meeting the EB-5 program’s criteria.

Why Should You Choose a Regional Center Project Over a Direct Investment?

Choosing a regional center for your EB-5 investment offers significant advantages that can simplify the process and increase the likelihood of success. Unlike direct EB-5 investments, where the investor must actively manage the business, regional centers allow for a more passive role.

Additionally, regional center projects typically qualify for the lower investment threshold in targeted employment areas (TEAs), making it a more accessible option for many investors.

The EB-5 Reform and Integrity Act of 2022 also introduced set-aside visa quotas and priority processing for investments in specific TEAs, enhancing the appeal of regional center projects.

Currently, regional center investments are the preferred route for most EB-5 investors, accounting for over 95% of all applications.

What Services Can You Expect From a Regional Center?

Regional centers offer numerous services to clients as an all-in-one package. These services collectively contribute to the success of your EB-5 application. The following are a few important things a regional center can help you with.

Due Diligence and Project Selection

Regional centers conduct extensive due diligence on potential EB-5 projects before presenting them to investors. This process includes evaluating the project’s financial viability, job creation potential, and compliance with USCIS regulations. By doing so, regional centers aim to reduce risk and ensure that the project meets all EB-5 requirements.

Despite this, investors are also encouraged to perform due diligence to safeguard their investments.

Legal and Administrative Support

Once an investor selects a project, the regional center provides legal and administrative support. This includes assistance with preparing and filing the I-526E petition, which is essential for the investor’s immigration process.

The regional center supplies all necessary documentation, such as the Private Placement Memorandum (PPM), proof of TEA designation, and evidence of job creation. They also help verify and document the investor’s source of funds, a critical component of the EB-5 application. This reduces the risk of errors that could delay or jeopardize the investor’s application.

Ongoing Communication and Transparency

After filing the EB-5 petition, regional centers communicate with investors to provide updates on the project’s status. This includes detailed reports on financial performance and job creation progress.

Transparency is also key, as investors rely on timely and accurate information to track their investments. This is to ensure that the project remains on track. Good regional centers also offer direct access to key stakeholders, allowing investors to get answers to specific questions and maintain confidence in their investment.

Investor Security and Risk Mitigation

Regional centers play a crucial role in mitigating risks associated with EB-5 investments. They structure projects to meet USCIS requirements and focus on job creation to ensure compliance. Many regional centers also offer projects in sectors with lower volatility, such as real estate or infrastructure, which are less likely to experience financial downturns.

Some regional centers even provide certain guaranties on select projects to add an extra layer of security to their clients’ immigration process.

What to Consider When Looking for the Right Regional Center

Choosing the right regional center is one of the most important decisions you’ll make in your EB-5 journey. The success of your investment and your path to U.S. permanent residency heavily depend on the regional center’s compliance, experience, financial stability, and communication practices. Below are a few key factors you should consider when selecting a regional center.

USCIS Compliance and Regulatory Adherence

Ensure the regional center has a valid USCIS designation and complies with all regulatory requirements. Check if they have ever received a termination notice. Such issues can delay your EB-5 process and jeopardize your investment. Verify their compliance by requesting their Form I-956 approval notice, which confirms their USCIS standing.

Experience and Management Expertise

Assess the regional center’s history and the experience of its management team. Look for regional centers with a long operational history and a strong track record of successful EB-5 projects. Review their I-526E and I-829 petition approval rates, which show how often their projects meet USCIS requirements.

Also, consider the team’s experience in finance, real estate, and law, as this can impact project success.

Financial Stability and Investment Security

Check the financial health of the regional center and the viability of its projects. A stable financial foundation is crucial for the long-term success of your investment. Also, review their project selection process to understand if the regional center’s priorities are in your best interest.

It would be helpful to look for regional centers that offer low-volatility projects in stable industries like real estate.

Transparency and Investor Communication

Choose a regional center known for its transparency and clear communication. They should provide regular updates on project status and be responsive to investor inquiries. Access to detailed financial reports and direct communication with key personnel are essential.

Transparent regional centers are more likely to keep you informed, which is important for checking the progress of your investment. Past investors’ testimonials can also offer insight into the regional center’s communication practices.

Key Questions You Should Ask Before Choosing a Regional Center

Asking the right questions is crucial when selecting a regional center for your EB-5 investment. These questions will help you assess the regional center’s credibility and track record. Let’s consider some below.

1. Is your regional center currently in good standing with USCIS, and can you provide your Form I-956 approval notice?
2. How many EB-5 projects have you completed, and what is your I-526E and I-829 petition approval rate?
3. Can you provide detailed information about the financial stability of your current projects and their funding sources?
4. What is your regional center’s track record in meeting job creation requirements for EB-5 projects?
5. How do you select and vet the projects that are included in your EB-5 offerings?
6. What type of legal and administrative support do you provide to investors during the EB-5 process?
7. How frequently will I receive updates on my investment, and how will these updates be communicated?
8. Can you provide references or testimonials from past investors who have completed their EB-5 journey through your regional center?
9. What measures do you have in place to mitigate risks and protect investor capital, especially if a project encounters difficulties?
10. What is your policy on fund redeployment if the initial project is completed before my I-829 petition is approved?

Take Your EB-5 Journey to the Next Level With EB5AN

When it comes to securing your U.S. residency through the EB-5 program, choosing the right partner is crucial. EB5AN stands out as an industry leader with a proven track record of success and a commitment to investor security. With over 2,300 families from 60 countries relocating to the United States as permanent residents, EB5AN’s expertise is top-notch.

Schedule a free consultation with the EB5AN team today to learn more about the EB-5 process and start your Green Card journey.