Visa retrogression was a hot topic at this year’s NES Financial EB-5 Innovation Summit, with implications for investors not only in China, but globally as well. The impending freeze on new visas for Chinese investors has many experts saying the EB-5 investor pool will develop a great deal more diversity in coming years.
Of course, sourcing investors from new markets will bring not only new opportunities but also new challenges. Currently, more than 80% of EB-5 investors are of Chinese origin. For wealthy Chinese citizens looking to immigrate to the United States, EB-5 is a well-known option. There is a well-established network of migration agents in China who introduce Chinese investors to U.S. Regional Centers and other issuers and help serve as translators and mediators in the early stages of the EB-5 process. The infrastructure necessary to recruit Chinese investors is, for the most part, already in place; issuers need only sell their particular project and not the EB-5 program in its entirety.
In contrast, when sourcing investors from countries with a lesser presence in the EB-5 market, simply accessing potential investors can be a challenge. Even after finding those with both the interest and financial eligibility to participate in the program, investors must be educated on the legitimacy of both the program and the projects. The Regional Centers and developers must navigate the regulatory hurdles of both the investor’s home country and the United States, and often communication can be stymied by barriers of both language and geography. In short, paving the way to new markets can be a much more laborious process than working within established regions. However, this groundwork is quite likely to pay off in dividends.
As retrogression looms, new international markets are bound to continue emerging. As of right now, South Korea, Taiwan, and Vietnam are following closest behind China in terms of EB-5 participation – although still resulting in a very small percentage of EB-5 petitioners.
NES Financial Intelligent EB-5 Solutions can help streamline EB-5 account and project management through all stages of the process, leaving developers free to focus their attention on international recruiting. With solutions that set industry standards for security, transparency, and compliance, and a Medallion Award Program that’s quickly become a well-recognized indicator of project quality, partnering with NES Financial can be a valuable tool for marketing, especially in regions where EB-5 is relatively unknown. Further, our recently introduced EB-5 Reservation Account Solution enables issuers to safely receive financial commitments from investors early in the process, easing many pressures they may otherwise encounter.
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