EB-5 Market: “We Have Seen an Uptick in Smaller, Rural and Direct Projects That Have Thrived During the Pandemic”

Jul 12, 2021

Tom Martin is the managing director/community impact director at Baker Tilly U.S., and Wright Johnson before that. He has been involved in EB-5 since 2010 when a need for EB-5 customized business plans and economic analysis reports rose sharply in the industry.

“We sought to provide the highest level of quality in these essential documents while at the same time making them tailored specifically to fulfill EB-5 application requirements,” he said.

 

What are some current trends you are seeing in the EB-5 market?

The EB-5 marketplace is evolving to match the changing landscape of EB-5. Following the regulation changes in 2019, which increased the investment amount and made TEA more difficult, many began to seek out rural projects that were solidly considered TEA. We are also seeing more creative investment terms for EB-5 investors. Increases in interest returns as well as variable rates based on level of investment and length of investment are also trends we continue to see in deal structuring.

 

How do you think the pandemic has impacted the EB-5 industry?

Many real estate projects, including hospitality projects that have traditionally dominated the EB-5 space are struggling to stay financially afloat. We have seen a pause in projects moving forward with EB-5 until the current pandemic fallout subsides. We have also seen an uptick in smaller, rural and direct projects that have thrived during the pandemic. Quick service restaurants, manufacturing, and residential housing projects have all increased in number since the pandemic began.

 

What are your top business goals this year?

Continue to provide excellent service to our amazing clients as EB-5 ramps up following the passing of the new legislation. We see signs that investment activity is primed to take off as market conditions continue to normalize throughout the recovery cycle.

 

What achievement in this industry has been most rewarding? Why?

Being acknowledged by my peers as being a top service provider within our industry. We are surrounded by incredible and talented individuals and to be recognized as a top provider is very rewarding.

 

What are your thoughts about the redeployment situation and the best strategy to deal with it?

Redeployment is a challenging situation for all parties. For investors who have done their due diligence on a project and feel comfortable investing their EB-5 dollars into that specific project only to have their money redeployed a few years later into some other project that they have no say in can be difficult. In addition, it can also be difficult for developers who want to return the money when it is no longer needed, so they can stop paying the interest on those funds.

All deals structured today should include specific details as to how funds will be redeployed should that be required so that investors can make an informed decision not just on what project they will invest in, but what will happen to that money after funds are returned to the NCE.

 

What do you think needs to be reformed with the EB-5 program at the time it is up for renewal in June?

We support the reforms proposed in the current legislation and believe it will pass before the end of June. While not perfect, and we would have preferred to have an increase in the available visas, removal of derivatives from the visa count and a recapture of past unused visas, we believe that many integrity measures outlined in the current legislation are beneficial to the program and a 5-year extension gives the program a much needed boost in security.

 

What would you change or do if you were president for a day?

Provide extra resources to completely digitize the EB-5 process. Having a single portal for uploading application documentation would significantly reduce the risk of documents being lost, increase efficiency in assigning cases, and reduce the environmental burden of so much paper being needed to file a single application. It is high time that USCIS was brought into the 21st century and modernized the process in a way that will make easier for everyone, including the planet!

 

What is your favorite quote and why?

“The best way to get started is to quit talking and begin doing.” – Walt Disney

 

What about you would surprise others?

I am a cancer survivor and an avid runner.

 

Why did you decide to join our verified EB-5 community and what has it done for your business?

EB5Investors.com provides a critical community for our industry. Being able to go to one source to find all industry professionals is a benefit to the entire industry.

 

***ORIGINALLY POSTED IN EB5INVESTORS.COM***

This content was originally published here.

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