As immigration attorneys we are constantly approached by various Regional Centers touting their EB-5 projects. Many Regional Centers focus on loan based projects, real estate (re-)development, or operating a franchise. Some of these seem like viable projects likely to make money, while others seem like terrible investments. Yet as an attorney and not a financial adviser, we must tread carefully and can not actually give investment advice.
Recently the Atlantic American Opportunities Fund (AAOF) contacted us about their EB-5 regional center. What seemed interesting to me is that they invest in a variety of businesses as opposed to the standard one pet-project of the developer. This offers a more diversified approach to the EB-5 investment.
The AAOF is managed by two sister investment firms (Communications Equity Associates and Atlantic American Partners). Like most EB-5 Regional Centers they are located in a targeted employment area, so investors can obtain their “million dollar green card” for a $500,000 investment.
Another important piece of information that caught my eye is that the EB-5 investor’s returns are not limited, as they are in many other EB-5 projects. The management does earn their 2.5% fee before the investor receives any return, the next 5% is paid to the investor, and the next 5% goes to the General Partner (only when there is more than a 7.5% return). If there is more than 12.5%, then the remaining profit is distributed 50/50 to the investor and General Partner.
Any EB-5 investor should always consult with a financial adviser before deciding which EB-5 Regional Center offers the right investment strategy for their individual needs.