Syracuse forum educates developers on EB-5 opportunities

Central New York developers interested in learning about EB-5 capital and why it is becoming one of the most sought after sources of financing for economic development projects nationally, attended the EB-5 Forum on Economic Development on Sept. 23, at the Tech Garden in downtown Syracuse, N.Y.

The forum was hosted by the Federal Reserve Bank of New York and the CenterState Corporation for Economic Opportunity, with Stephanie Miner (left), mayor of Syracuse, and CenterState president & CEO Rob Simpson, welcoming forum attendees.

Rae Rosen, vice president, Federal Reserve Bank of New York, said the role of the Federal Reserve is to maximize job growth and employment at low and stable rates of inflation. “We hope this event sparks some ideas,” she said.

What makes EB-5 attractive to developers?

The forum was moderated by Peter Joseph, executive director of the Association to Invest In the USA (IIUSA, the industry trade organization which that advocates for policies that will maximize economic benefit to the U.S. from EB-5). “The (EB-5) deal has to fit into the community. Investors need the project to go forward to create the jobs so they can get their visa, their principal capital back, their return on investment.”

Among the panel participants was Bill Gresser (lower right), president of EB-5 New York State Regional Center, who said, “The key for us is this: is this a real project with a real developer that’s really going to happen? Just like a bank, just like an equity partner, we want to make sure this is a real project that’s going to be successful.

“One of our objectives is education, letting developers know this program exists and might work for you. (Having them ask), ‘Does my development work for EB-5?’ We work with developers so they get comfortable with what we’re doing.”

The government’s role

“The government component on an EB-5 project is really important for raising capital,” Gresser said. “We’re working on a project where there is a huge amount of capital coming from the Federal government, the state, city and county, in terms of master plan development, direct development and pilots into the future. The benefits from government may be in hard dollars, but they may be something else.

“Our objective is to use EB-5 capital to create jobs,” Gresser said.
The IIUSA’s Joseph concluded by noting the EB-5 program has been in existence for 20 years, but needs to be reauthorized by Congress by Sept. 30, 2015. “This is going to require anyone involved in the program to talk to their local chambers, political offices and let people know why the program is important to your communities.”

From FY 2005-2013, EB-5 has accounted for over $6.5 billion in capital investment, supporting more than 131,000 U.S. jobs, and the numbers are growing every day. The Regional Center members of IIUSA account for 96 percent of all EB-5 capital.

The EB-5 program was created by Congress to benefit the U.S. economy by attracting investments in job creating projects from qualified foreign investors. Under the program, each investor is required to demonstrate that at least 10 new jobs were created or saved as a result of the EB-5 investment, which must be a minimum of $1 million, or $500,000 if the funds are invested in certain high-unemployment or rural areas. EB-5 Regional Center New York State, based in Buffalo, is among the EB-5 Regional Centers that pool capital from multiple foreign investors for investment in projects that create jobs.

Other panel members were Mike Anthony, vice president, M&T Bank, Terry Gilbride, partner and real estate attorney with the law firm, Hodgson Russ, Kate Johnson, legal counsel, COR Development and Eric Schultz, immigration attorney with Hiscock & Barclay.