What are the pros and cons of using guest expenditures and/ or revenues inputs to my economic impact model to show more job creation?
These kind of inputs in the economic model will help to add to the indirect job count, however:
1. Guest expenditures are contentious as an input and will likely invite push-back from USCIS and from investors.
2.Revenues are allowable inputs but this puts more risk on the certainty of job creation. If only development expenditures are used as inputs then the money only needs to be spent as indicated in the business plan foir the jobs to be effectively created. If revenues are used as an input, the jobs tied to the revenues used as inputs cannot be claimed until those revenues are achieved so it's a more difficult path to the green card for investors.
As Philip mentioned I would stay away from using guest expenditures to prove job creation as this is something that the USCIS does not take very well. In regards to the revenues generated by the project, you can certainly include them and many projects do. There is a benefit and a risk. The benefit is that it will give you more jobs for the project, and the risk is that most projects tend to be overly optimistic on the forecast to attract investors, meaning that if the revenue is not achieved, the USCIS will have trouble with it. A good tactic about this is to include the revenue just to create a buffer on jobs on top of your construction expenditures. This will give EB-5 investors more confident on the project.
It would not be a good idea to use them to satisfy the "required number of jobs" but as Ismael said, it could boost confidence in the project if used to create the buffer. Our experience is that investors are looking very hard on hotel projects which typically use these kinds of inputs. If we could show our investors that the construction jobs already fulfill the minimum job requirement and the indirect jobs resulting from guest expenditures, revenues or hotel employee expenditures such as buying lunch in a Deli across the street are just icing on the cake then they feel much better about the project.
Subscribe for News
This website is for informational purposes only and does not constitute an offer or solicitation to sell shares or securities. Any such offer or solicitation will be made only by means of an investment's confidential Offering Memorandum and in accordance with the terms of all applicable securities and other laws. This website does not constitute or form part of, and should not be construed as, any offer for sale or subscription of, or any invitation to offer to buy or subscribe for, any securities, nor should it or any part of it form the basis of, or be relied on in any connection with, any contract or commitment whatsoever. EB5Projects.com LLC and its affiliates expressly disclaim any and all responsibility for any direct or consequential loss or damage of any kind whatsoever arising directly or indirectly from: (i) reliance on any information contained in the website, (ii) any error, omission or inaccuracy in any such information or (iii) any action resulting therefrom.