The North Dakota/Minnesota EB-5 Regional Center, is constantly in the process of screening investment opportunities. Unfortunately, not every business venture will meet the requirements of the EB-5 program set forth by the U.S. Citizenship and Immigration Services (USCIS) or those unique to the North Dakota/Minnesota EB-5 Regional Center.
- Geographic Region
The project must be in the state of North Dakota or Minnesota. We seek projects that are located in a Targeted Employment Area or in an area that can be reclassified as one. We have an economist on staff who can help determine a location’s eligibility to be reclassified, if not already in a Targeted Employment Area.
- Create 10 jobs per EB-5 Investor
A project must be able to create at least 10 full-time jobs for qualifying U.S. workers within two years of the investment per EB-5 investor. When working through a regional center indirect and induced jobs, in addition to direct jobs, count towards the job creation.
- Seeking $10M in EB-5 Financing
Due to market demands, EB-5 is best suited for mid-to-large size projects. Typically, we look at projects that are seeking a minimum of $10M in EB-5 financing.
- Financing Mix
We look for projects that have a diversified mix of financing. This could include equity investments, secured bank loans, bonds, and government financing. We require that the developer invest what we deem an appropriate amount of equity into the project as well. Additionally, we look for projects seeking no more than 30% of the total capital size in EB-5 .
- Clear Exit within 5 Years
EB-5 investors are looking for a clear exit of their investment. Most EB-5 projects strive to return the principals investment, plus interest, within 5 years of the initial investment.
- New or Expanding Company
New: created or restructured after November 19, 1990
Expanding: existing net worth or number of employees by a minimum of 40%
Company Document Requirements
The North Dakota/Minnesota EB-5 Regional Center requires the below information when screening projects and conducting due diligence. Additional documents may be required, on a project-by-project basis, during the project review and upon approval.
5 year Business Plan
A business plan is a written document that describes in detail how a business is going to achieve its goals. A business plan will layout a written plan from a marketing, financials, return on investment, and operational viewpoint. This allows EB-5 investors to gain a well-rounded understanding of the company they plan to invest in.
Complete Set of Financials
The North Dakota/Minnesota EB-5 Regional Center requires companies to share past, current, and project proforma financial information. Additionally, the company will need to clearly illustrate where all financing will be coming from, in addition to EB-5 financing. The company will need to have obtained, or show they are on track to secure, the other equity and debt financing. It is also critical to clearly outline the developer or project principal’s equity into the project.
Third Party Market Analysis
A third party market analysis is required to show the market demand unique to the project’s location and industry sector. It is important for this analysis to be conducted by a reputable third party.
Private Placement Memorandum
A Private Placement Memorandum (PPM) is a legal document stating the objectives, risks, and terms of investment. This includes items such as the financial statements, management biographies, detailed description of the business, etc. An offering memorandum serves to provide buyers with information on the offering and to protect the sellers from the liability associated with selling unregistered securities. When using the loan model, the North Dakota/Minnesota EB-5 Regional Center puts together the PPM for the lending company, but will rely on the company to provide project specific information.
There are several different input/output models accepted by the USCIS, but the two most common methods are IMPLAN and RIMS II models. The principal difference is that IMPLAN is an employment-driven model, while RIMS II is an output-drive model. A preliminary economic analysis is conducted by the North Dakota/Minnesota EB-5 Regional Center during the project screening process for a fee of $250. This analysis will help to determine how much EB-5 financing the project can support. Once a project is approved, a full economic analysis is conducted by the North Dakota/Minnesota EB-5 Regional Center on behalf of the company.