EB5 Affiliate Network (EB5AN), an EB-5 investment fund manager, regional center operator, and consultancy firm has created a simple investment framework to help guide investors in selecting low-risk EB-5 projects.
All EB-5 investments carry a certain degree of risk. Immigration risk describes how likely an EB-5 investor is to receive a green card, while financial risk describes how likely an investor is to recover the EB-5 investment. EB-5 investors should seek projects in which both risk factors are nearly zero. But for many investors, selecting low-risk projects can be confusing.
EB-5 investors do not need to understand every detail of the EB-5 program to select a safe project. Investors can make informed decisions by learning some basics about the current state of the EB-5 program, by understanding key risks, and applying a few guiding principles for selecting low-risk EB-5 projects.
The ultimate goal is to pick a “successful” EB-5 project—one that results in a permanent green card and a timely return of investment funds. The good news is that more than one low-risk EB-5 project is available today. So by simply avoiding projects that have a higher risk of failure, investors significantly improve their chances of success.
EB5AN believes that EB-5 investors should use a “last project standing” approach by applying a simple investment framework that eliminates higher-risk project options. The handful of projects that remain will provide a higher chance of a successful EB-5 investment.
Our simple framework addresses the following key EB-5 project characteristics: (i) geography, (ii) industry, (iii) investment structure, and (iv) development progress.
“EB-5 investors desire to invest in low-risk projects, but finding projects with minimal risk can be a real challenge,” said Silverman. “EB-5 investors may not be aware of what makes a project risky, so we have created a simple framework to help guide investors as they seek low-risk opportunities.”
Schoenfeld added, “Our simple framework walks investors through a series of straightforward questions. We provide a detailed explanation of what the risks are and then immediately pivot to real-world applications. This guide makes it easy for investors to perform due diligence on projects, quickly weeding out higher-risk options.”
“Our desire is to help EB-5 investors find the best possible projects that expose them to the least amount of risk,” concluded Silverman. “The framework we’ve developed condenses years of industry knowledge about EB-5 risk and gets it in front of the people who need it most: investors.”