Job Creation 3 of 3

Question: In a case where the EB-5 business is a real estate development, which leases space to tenant businesses who then hire employees, do the following factors increase the likelihood that those tenant’s jobs can count toward satisfying the job requirements of the development’s EB-5 investors:

d. The tenant received free rent or rent reductions

e. The tenant received an equity investment from the development

Answer:

d. The tenant received free rent or rent reductions

This is acceptable with caveats.  Similar to (b) above, this effectively represents the comingling of capital as the free rent/rent reductions acts as a loan.  The same caveats apply here as in (b) above.  In addition, this will cause a significant decrease in rental income for the EB-5 NCE, which should be an investment at-risk, not at-loss.  USCIS would still need to define the constraints of the rental discount required, which effectively serves as a loan.  It is highly unlikely, however, that the free rent or rent reduction over a 2.5-year period would sum to a total amount that could be considered a substantial investment in the tenant business.

e. The tenant received an equity investment from the development

This is acceptable with caveats.  Again, this effectively represents the co-mingling of capital as in (b) above.  The same caveats apply here.

Taken directly from USCIS EB-5 Immigrant Investor Program Quarterly Stakeholder Engagement on May 1, 2012.