Advantages And Disadvantages Of Investing In A Regional Center

What Are The Advantages Of Investing In A Regional Center?

The advantages of investing in a regional center are that the person really doesn’t have to do anything. They’re a limited partner and just have to perform a due diligence on the project to make sure it will ultimately lead to a permanent green card. That and making sure they get their investment back, are the ultimate goals.

The other advantage to a regional center investment, is that you don’t have to spend time setting up a business. Initially, it may only take 2 years to get your initial conditional green card. However, to get a permanent green card, you have to have the business operating and creating jobs through at least a 5-year period.

All investors should also do due diligence on these projects to make sure that they have good track records, that they have many approvals and investors who did get their money back. These are people who received permanent green cards, especially if their regional center has been doing business for quite a while.

In summary, the benefits of investing in a regional center are that the person can do due diligence, choose investments among a lot of choices, do not have to manage their business on a day-to-day basis and be free to do whatever they want once they come here.

What Are Some Disadvantages Of Investing In A Regional Center?

There are two types of regional centers; one is called the “Loan Project”, or a loan fund, and the other is referred to as “Equity Project” where investors are actually a part owner in the business; whether it is a senior center, hotel or something else.

In the loan project, you’re investing in a loan fund that has a promissory note with a due date of generally five to seven years. If you have a percentage ownership, then you will get to review a summary of what the developer feels are conservative, mid-range and optimistic results as far as returns before you choose to invest.

The advantages to people who are investing in loan funds are that they have a due date of when they’re going to get their money back, assuming that the developer can refinance the project. The disadvantage is that it’s a very little return on the investment, generally only half or one percent. However, most people are not really looking so much at the return because even on an equity project, the return may not be tremendously high, maybe only two to four percent. Although, it is generally higher than a loan project if the business is successful. However, it’s still not the ten or fifteen percent somebody may want if they’re investing in their own business.

Additionally most people are not only concerned about getting their permanent green card but also in getting their $900,000 investment back. That’s always a concern even though if the person did their due diligence and saw the track record of the regional center. If the regional center hasn’t been in business 5 or 6 years to show they have gone through the entire process to get a permanent green card, then somebody should look to see what kind of track record in business they had before they got involved in EB-5.

If you need information regarding Advantages And Disadvantages Of Investing In A Regional Center, call the Immigration Attorneys at Mark A. Ivener, A Law Corporation for a FREE Initial Consultation at (310) 477-3000 and get the information and legal answers you’re seeking.