Created by Congress in 1990, the EB-5 program has quickly emerged as an important economic development tool that has successfully stimulated U.S. job creation by attracting foreign direct investment in the United States. Polsinelli offers counsel to investment firms seeking to utilize and deploy EB-5 capital, and is well-versed in the nuanced considerations of an entity’s successful participation in the EB-5 program. Our firm’s experience includes advice and guidance in the following areas: 

Regulatory Compliance - A majority of EB-5 investments are achieved through private placements. Like all private placements, which are used by companies to raise capital in a number of contexts, EB-5 private placements are governed by federal and state securities laws and regulations, and often involve the use of broker-dealers. Polsinelli advises clients on various issues associated with complying with the U.S. Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) rules and regulations, and always encourages companies and managers to take a preemptive and proactive approach to compliance.

Investment Funds/Management - Our firm counsels sponsors and managers of private equity funds that seek to (i) raise the capital from EB-5 investors, and (ii) invest it in job-creating projects, through a highly complex fund formation process. We collaborate with managers and sponsors to understand (i) the specific makeup of investors that an investment fund is tailored to attract, (ii) the capital structure of the prospective underlying project, and (iii) the investment fund’s intended role in the project. With this information, Polsinelli structures investment vehicles to achieve our clients’ objectives and ensure that the funds comply with applicable securities laws. The Polsinelli team provides the full range of services - from initial fund formation throughout the life of the fund.

Real Estate and Real Estate Finance - The most common types of projects utilizing EB-5 financing involve the construction and development of real estate. Polsinelli’s Real Estate and Real Estate Finance teams actively engage in all phases of land acquisition and financing, with an eye toward EB-5 issues. Polsinelli’s Real Estate group conducts in-depth due diligence reviews of any land, land entitlement, and development documentation, as well as diligent and efficient execution of the closing process. Our Real Estate Finance team simultaneously assumes lead roles in drafting and negotiating the finance documentation necessary to protect an investment fund’s interest as a lender (whether senior or mezzanine) or equity investor (whether preferred or common) in the various EB-5 capital structures. Examples of ongoing EB-5 projects include multi-tier financing and equity structures involving hotels, senior living facilities, student housing, multi-family projects, and mixed-used developments, with retail, restaurant, and office components.