Investors in the EB-5 visa program fall into two categories: those who invest as individuals, also referred to as a Direct Investor, and those who invest through the Regional Center Program. While both desire to invest at least $500,000 into a new U.S. commercial enterprise, create new U.S. jobs and be granted permanent residency status, they differ greatly in other respects.

Direct EB-5 investors are entrepreneurs who wish to own and operate new U.S. commercial enterprises and receive their permanent residency status through their own efforts. These investors wish to maintain managerial and operational oversight, and not simply be silent investors. They will have a strong grasp of the English language and be familiar with business practices in the U.S. This type of investor assumes the responsibility to adhere to the EB-5 regulations in order to receive their permanent residency status when it comes time to filing their I-829, removal of conditions.

The Regional Center Program on the other hand attracts another type of EB-5 investor, and it was created to make it easier for foreign investors to receive their permanent residencies by making a managed investment. Multiple investors may pool their funds into a new commercial enterprise to qualify for the EB-5 visa. The EB-5 program requires the creation of 10 new U.S. jobs within two years, but those investing through a Regional Center have a distinct advantage over individual investors. Investors that go through the Regional Center Program do not need to undertake all of the responsibility with regards to job creation requirements and management of the new commercial enterprise. Instead, it is the Regional Center’s responsibility and they can use various approved methodologies to demonstrate job creation through direct, indirect and induced means, thereby reducing the amount of direct jobs required to fulfill EB-5 regulatory requirements and broadening the choice of investments that would not ordinarily qualify for a Direct EB-5 investment. Additionally, since Regional Center investors do not carry the burden of managing the day-to-day activities of their business, they are free to live, work, relax and travel when and where they wish.

Since Regional Center investments typically require repayment of the capital to the EB-5 investors within a certain period of time, there will often be a clear exit strategy for the EB-5 investors from the outset of their investment. The investor can either deploy their funds as debt to the project through the Regional Center of their choice, or invest their capital into the project via equity. If the investor chooses to invest their capital through a Regional Center, ordinarily their EB-5 funds would remain invested for a period of at least 5 years, typically with some interest. Repayment of their investment would be effectuated through a sale or refinancing.