USCIS Revised EB-5 Redeployment Requirements
On July 24, 2020, USCIS updated its Policy Manual revising EB-5 redeployment requirements for EB-5 capital while EB-5 investors wait to complete their two-year conditional residency periods.
The key changes include:
- Municipal bonds are no longer an acceptable redeployment strategy
- Redeployment must be consistent with purpose of the New Commercial Enterprise’s (NCE’s) ongoing business and deployed through the same NCE
- Redeployment must occur within geographic area of the regional center (TEA not required)
- EB-5 funds must be redeployed within 12 months to be a reasonable amount time
See a redline version of the USCIS Policy Manual at Lucid Text EB-5 Blog.
USCIS Policy Manual Update is Retroactive
USCIS stated that its revised EB-5 redeployment requirements are retroactive, i.e. they apply to “all Form I-526 and I-829 petitions pending on or after date of publication. USCIS claims the impact on EB-5 investors and EB-5 Regional Centers will be minimal, suggesting these changes to the EB-5 redeployment requirements are mere clarifications to its initial guidance 3 years ago. This will prove controversial. For 3 years, several Regional Centers and EB-5 investors, rightly or wrongly, have considered redeployment to municipal bonds as their redeployment strategy. Behring has always considered bonds as a temporary measure and not without risk, preferring the tested strategy of redeployment funds in core assets.
Behring’s Successful Redeployment Strategy
Behring Regional Center’s EB-5 investors will not be impacted by these updates. Behring continues to meet these EB-5 redeployment requirements because prior redeployments have been (1) through the same NCE consistent with its business purpose; (2) within the same geographic area; (3) within 6-12 months upon exit of the completed project; and (4) in the same asset type – residential housing. Behring keeps true to a successful formula: investing in Bay Area multifamily residential housing.
Key Factors for Successful EB-5 Investments
Determining where to make an EB-5 investment is not simply a matter of choosing a project; rather, it is about choosing the right team – the people behind the project. EB-5 is a medium to long-term investment depending on backlogs and processing times.
The EB-5 investor should consider many factors, especially the asset type because different asset types, such as retail and hospitality are much more sensitive to economic downturns. This has been especially true during the COVID-19 pandemic. Few people are traveling, resulting in fewer hotel stays. Online retail sales has eclipsed brick and mortar. Moreover, market demand and drivers for that specific project are important because while the project might be quality, low-risk asset type in a great location, there still needs to be a demand for the project. Key demand drivers include proximity to public transit. A successful redeployment strategy is not only key to satisfying EB-5 redeployment requirements, it is also important for the security of the EB-5 investment.
Behring’s Legacy Fund: A Ready-Made Redeployment Strategy
Behring’s Legacy Fund is an open-ended real estate fund that enables the EB-5 investor to customize their own EB-5 risk and return profile. The fund offers a convenient vehicle for redeployment because reinvestment is made through the same NCE, and all investors benefit as the NCE’s portfolio grows. At the same time, EB-5 investors can take advantage of the Behring strategy, i.e. they can get access to institutional quality, multifamily residential real estate developments.
Learn More About EB-5 and EB-5 Redeployment Requirements
To learn about Behring’s redeployment strategy and how EB-5 might work for you and your family, contact Behring for a free consultation. Behring welcomes you to visit our expansive library of EB-5 resources available for download as well as our FAQs and blogs to enable you to get the information you need to best prepare you for your EB-5 investment and green card journey.
- No retrogression for India EB-5 investors. Learn more about recent visa bulletin.
- USCIS updated estimated processing times for EB-5 petitions. Learn how to interpret them.
- USCIS will not review an EB-5 investor’s I-526 petition unless a visa is or soon is available. Learn more about its visa-availability approach.