We are often called in to speak to developers, private equity funds and other organizations that have an interest in having one or more projects adopted by a regional center. For many companies it often does not make sense to seek their own regional center designation for a variety factors including the time and cost involved in obtaining a USCIS designation, the company’s projects are geographically diverse and could not be located in a single regional center, the company does not wish to be in the “business” of being a regional center because of the administrative and compliance related obligations, etc…

As the EB-5 program continues to grow in popularity for its ability to source funds at low rates, project adoption has become more and more common. However, there are many pitfalls for the unknowing. Many regional centers are simply seeking designation in order to “sell” that approval to projects in return for exorbitant fees- often in the millions- with little provided to the project in return. Other regional centers are good faith actors and are willing to take a fee to adopt a project in return for providing the project with access to a pool of investors, conducting marketing efforts on behalf of the project and tracking investors and job creation or some other EB-5 program related services. Having experienced immigration and corporate counsel on hand to guide your organization is critical to ensuring an equitable agreement is reached and that the immigration and business objectives of both the project principals and regional center are reached.
The following list of due diligence questions can serve as a starting point when exploring the option of EB-5 project adoption.

1. What fee would the regional center take for adopting the project?
2. What are the fees associated with having the project adopted by the regional center? Do they take fees up front to review the project proposal and business plan? Do they require an equity stake in the project? Does the regional center impose a success fee once an exemplar filing or individual I-526 petitions are approved? How high is the success fee?
3. Does the regional center take any portion of the administrative fee paid by the investors?
4. Does the administrative fee include the cost of I-829 materials?
5. If the I-526 is denied can the investor recoup their administrative fees?
6. Does the regional center require that the project principals retain their immigration and securities/ corporate counsel? What is counsel’s experience?
7. When was the regional center approved by USCIS, and has it gone through any amendments?
8. Has the regional center received any I-924 denials on amendment or project proposal requests?
9. Has the regional center’s designation ever been the subject of a Motion to Reopen?
10. Has USCIS ever issued a notice of intent to terminate or has a formal termination ever been issued for the regional center?
11. What type of infrastructure does the regional center have to ensure compliance? Ex. management software, a team of dedicated professionals employed to administer the EB-5 program, a team of outside consultants, etc…
12. Has the regional center completed any EB-5 projects?
13. What is the regional center’s success rate with I-526 and I-829 petitions including approvals, denials and withdrawals?
14. Has the regional center been the subject of any Requests for Evidence or Notices of Intent to Deny? Has its projects?
15. Have any of the regional center’s projects been reviewed by the AAO?
16. Has the regional center complied with the I-924a reporting requirement?
17. Is the regional center affiliated with any government entity?
18. Will the project be able to avail itself of the regional center’s relationships with municipal or state officials?
19. How many years of experience does the regional center have in EB-5 projects?
20. What is the regional center’s economic model?
21. Does the center work with a specific economist?
22. How much experience does the regional center’s economist have in EB-5 projects?
23. How is job creation tracked by the regional center?
24. What is the regional center’s system for tracking investors once they receive Conditional Lawful Permanent Resident Status through until the time that they need to file their I-829 petitions?
25. What is the regional center’s area?
26. Are the job creating project and the new commercial enterprise located in a Targeted Employment Area (TEA)?
27. Does the TEA designation rely on the use of contiguous census tracts?
28. Does the regional center use an escrow account?
29. How much of the investment amount is refunded if the I-526 is not approved?
30. Does the regional center require that individual EB-5 investors use their designated counsel for filing of I-526 and I-829 petitions? Can the project designate its own counsel?
31. Has an action for securities violations/ fraud ever been filed against the regional center?
32. Has the regional center’s website been reviewed to ensure SEC compliance?
33. Does the regional center provide quarterly, biannual or annual reporting of the status of the investment to the investors?
34. Does the regional center maintain direct contact with the investors?
35. Will the regional center assist the project with marketing and sourcing of investors?
36. How successful have other capital raises been? How much capital has the regional center raised in aggregate?
37. What screening process does the regional center have in place for potential investors?
38. What are the regional center’s relationships with overseas migration agents/ brokers?
39. Are the regional center’s U.S. based broker/ dealers licensed?
40. Does the regional center offer U.S. immigration attorneys referral fees?

Tags: EB-5 Program, EB-5 Project, Immigrant Investor, Regional Center
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Photo of Kate Kalmykov Kate Kalmykov

Kate Kalmykov is based in our New York and New Jersey offices and has over two decades of experience in business immigration matters. Kate currently Co-Chairs the Global Immigration & Compliance Practice at Greenberg Traurig. In this role, she works with employers of

…

Kate Kalmykov is based in our New York and New Jersey offices and has over two decades of experience in business immigration matters. Kate currently Co-Chairs the Global Immigration & Compliance Practice at Greenberg Traurig. In this role, she works with employers of all sizes across a variety of industries in understanding and complying with the immigration laws relating to the hiring and retention of foreign talent. Specifically, her practice focuses on supporting clients and advising them on temporary and permanent residency immigration options for multi-national executive, business, scientific, and information technology personnel. In addition, her practice provides support to companies in the global transfer of personnel. Known by her clients for her out-of-the-box thinking, responsiveness and hands-on approach, Kate is often called upon to assist in developing immigration options and strategies in the most unique circumstances and to respond to complex Requests for Evidence (RFEs), Notices of Intent to Deny (NOIDs) or to appeal denied cases. Likewise, she has also been instrumental in developing employer compliance programs for DOL related filings including H-1Bs and PERMs, as well as for I-9 employment eligibility verification. To this end, she develops and conducts nationwide I-9 compliance trainings and policy manuals for human resources personnel, advises on best practices for E-Verify employers, provides guidance on avoiding immigration-related unfair employment practices claims and has defended and minimized penalties in immigration-related government audits. Kate regularly works with professionals from the firm’s labor, employment, tax and benefits groups, to provide strategic planning on immigration issues within a cross-border framework.

Kate also has deep experience working on all aspects of the EB-5 immigrant investor program. Kate has worked with real estate developers, private equity funds, and other organizations on applications to designate new EB-5 Regional Centers, applications for pre-approval of EB-5 projects; having projects adopted by existing EB-5 Regional Centers; structuring projects to be EB-5 compliant, the sale of existing EB-5 Regional Centers, preparing template I-526 petitions and advice on structuring direct EB-5 projects. Pursuant to the requirements introduced under the EB-5 Reform and Integrity Act, Kate works with EB-5 Regional Centers, EB-5 Projects, Overseas Migration Agents and Broker/ Dealers to develop internal programs for ongoing compliance and to prepare USCIS I-956, I-956F, I-956,G, I-956H, I-956K submissions. Kate has represented thousands of investors in obtaining their green cards through EB-5 regional center projects, as well as direct EB-5 investment opportunities. She also represented and structured the largest EB-5 offering in the Program’s history and has over the course of her career structured over $12 billion in EB-5 deals.

Within the field of immigration law, Kate is a well-known speaker and author. She is often called upon by various media outlets to comment on topics of business immigration law including the Real Deal, the Wall Street Journal, and Law360. Kate has appeared on numerous TV programs related to immigration law including CNN, the Stoler Report, Vietface TV, and China Business Network. Kate is also a prolific writer on the topic of immigration and has been published in immigration practice handbooks for the American Bar Association, American Immigration Lawyers Association, ILW, and in news periodicals that include the New Jersey Lawyer, the New York Law Journal, the New Jersey Law Journal, USA Today, GlobeSt.com, and the Commercial Observer. At the request of the American Bar Association, Kate co-authored the book “What Every Lawyer Needs to Know About Immigration Law,” a guide for non-lawyers on immigration law practice. She has sat on numerous bar association related committees including the American Immigration Lawyers Association EB-5 Practice Committee, the New Jersey Business Immigration Coalition and has chaired the American Bar Association’s, Committee on Immigration and Naturalization, Section of Administrative Law since 2011. Kate has been recognized in various legal surveys including Chambers Global, New York Super Lawyers, the New Jersey Law Journal who ranked as her as a “New Leader of the Bar,” (formerly 40 under 40) in 2012, NJBIZ “Best 50 Women in Business,” 2019, National Law Review, “Go-To Thought Leader: Immigration Law,” 2022, and Lawdragon 500, Leading U.S. Corporate Employment Lawyers, 2020-2022.

Kate is devoted to pro bono matters and has spent extensive time helping clients fleeing conflict and persecution with asylum applications, applying for and obtaining Temporary Protected Status and Humanitarian Parole.

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