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Foreign Investors Attracted to Florida's EB-5 Visa Program

By:  Santiago J. Padilla, Esq.

Foreign investment in Florida real estate has been a significant factor in Florida's fight against a hard, harsh economy. In particular, commercial real estate in South Florida is benefiting from foreign investors as well, thanks to the federal foreign investment program commonly known as the Employment Based Immigration: Fifth Preference, the Immigrant Investor or the "EB-5" program.

The EB-5 program allows foreign investors to gain U.S. permanent residency by investing a minimum of $1,000,000 ($500,000 if invested in an area with high unemployment) of capital in a commercial enterprise, creating 10 direct and/or indirect jobs that will last at least two years. If the investment and job-requirement conditions are met, after two years investors can apply for unconditional permanent residency, even though they are not required to live in the United States. It provides a means to increase traditional financing sources and provide capital to projects and business that qualify. Recently, the program was extended through September 2015 by President Obama and Congress.

Florida has been one of the states suffering the most in the recession and the influx of foreign investment capital into the economy, for either residential or commercial purposes, has been welcomed and need. In fact, in September 2012, the City of Miami announced that it was the location of a new regional EB-5 Immigrant Investment Center and, earlier this year, its application to the U.S. Citizenship and Immigration Services of Administration was approved. The EB-5 center will be run at no cost to the city. Having an EB-5 center in Miami would allow foreign investors to invest in Miami through the center, and then receive their EB-5 visas. The City of Miami already has a list of real estate projects ready for investment. However, the areas targeted for investment are not limited to real estate, because Miami can support a long list of target industries. The application process may take six to eight months.

Almost all investments from the EB-5 program come through a commercial real estate project, whether it is a retail, office space or mixed-use project, which is of particular interest to Florida. To date, more than $3 billion of capital has been funded through the program, with millions of dollars of commercial real estate investments throughout the country.

In South Florida, several projects are either in development or have broken ground thanks to EB-5 funding. Among them is a projected 700-unit student housing project near Nova Southeastern University in Davie, which used EB-5 to fill in part of the shortage of student housing in that area and is expected to create 1,250 direct and indirect jobs. Another South Florida project in the process of being developed is a steel mill to be located in northeast Miami-Dade County; it will include a specially manufactured plant to house the steel manufacturing equipment. This project is expected to create in excess of 1,000 direct and indirect jobs.

The EB-5 program has the potential to foster significant development throughout Florida, and the rest of the country, and help boost the commercial real estate industry. Particularly in light of the current recession, it is unlikely that this program will be scaled back or revoked any time in the near future.

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If you have any questions regarding EB-5 investments or any other immigration law issues, please do not hesitate to contact me, Santiago J. Padilla, Esq., either at 800-483-7197, at [email protected], or on the internet.

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