Investor visas offer wealthy foreigners fast-track to green cards
Houston Chronicle by Lomi Kriel Dec. 6, 2014
https://www.houstonchronicle.com/news/houston-texas/houston/article/Investor-visas-offer-wealthy-foreigners-5940467.phpWhen Houston entrepreneur Roberto Contreras went shopping for capital to finance a $70 million luxury residential tower he was planning near the Galleria, he didn't look for equity in the usual places.
Instead he cast his net a lot wider, finding 20 well-heeled international investors, mostly from Mexico and Nigeria, who were willing to put up $1 million each for a stake in Houston's booming real estate market.
Those foreigners, however, weren't necessarily motivated by the hope of a tidy return on their investments. Their $1 million bought them and their immediate families the chance to immigrate to the United States. Created by Congress during a recession in 1990, a relatively obscure visa, known as EB-5, offers foreigners a much-coveted green card if they invest at least $500,000 in a U.S. business that creates 10 local jobs. Billed as American citizenship "via the red carpet," it fast-tracks the wealthy to the front of an immigration line that can drag out for decades.
At a time when coming to the U.S. legally has been its most difficult in half a century, interest in the program has skyrocketed from about 600 visas issued in 2008 to more than 5,100 this year, the most ever.
Chinese investors, buoyed by that country's new wealth, account for the vast majority, but Mexican, Iranian and Indian elites have also cashed in. For foreigners without direct family links to U.S. residents or sponsorship from a corporation, EB-5 is often the only option.
"Could Queen Elizabeth immigrate to America? No she could not, legally," said Charles Foster, chair of the Houston immigration firm Foster LLP. "But under the EB-5 program she could."
President Barack Obama's executive action on immigration, announced last month, would mainly benefit around 5 million mostly Mexican immigrants who have been here illegally for years. But what grabbed little attention was Obama's order that the Department of Homeland Security and U.S. State Department make rule changes enabling more foreign entrepeneurs to work here more easily.
Developers benefit
The EB-5 program has become a boon for developers who are using it to finance large-scale projects more cheaply than they could through bank loans. In Houston, with its flourishing real estate market and energy industry, the program is particularly appealing, funding projects such as Contreras' luxury tower Astoria, which is under construction and slated to open next year.
Around the country, EB-5 investors have financed spectacular developments, from revitalizing Seattle's SoDo district, repurposing military bases in California and Philadelphia, and funding New York City's high-profile Hudson Yards development, billed as the largest real estate project in U.S. history. But the program's successes have been marred by a lack of transparency and high-profile allegations of fraud and abuse.
Contreras, an immigrant from Mexico, had been on the front end of the EB-5 trend more than 20 years ago himself. Graduating from the University of Houston in 1988, he realized few avenues allowed him to remain in the U.S. legally. Foster, his immigration attorney, suggested he try EB-5, and he invested in a manufacturing company and eventually obtained his green card.
More at link.
