[PREFACE: As most of my readers know, I’m very wary of structuring new EB-5 Regional Centers and Projects. While many of my colleagues are doing very brisk business with EB-5 formations, I have a real issue taking on an EB-5 structure unless I’m 100% satisfied with both the quality of the folks behind the deal AND the confidence that when it is finally approved by USCIS, the project will actually FIND INVESTORS. The former issue of GP reputation is as much about protecting my OWN reputation as it is about protecting future investors; the latter issue of saleability is based upon the hard, cold reality that a tiny fraction of the 300+ — is it over 400 now? — USCIS approved EB-5 Regional Centers already on the market have succeeded in raising their first dollar. I’m not interested in earning a big fee when I know the deal will not sell, and I disagree with my colleagues who handle that issue by smugly pointing out that they are “just forming the project, not guaranteeing its success”. BULL-oney.]
Folks, I am happy to report that USCIS has approved American Bridge Seattle Regional Center! American Bridge was the only EB-5 RC I agreed to structure in 2012 and I am delighted that my clients can move forward. American Bridge is in fact an entirely new breed of Regional Center, and that’s not hyperbole…here’s why:
- The Regional Center is co-owned and managed by my good friend Greg Denton, who’s attended the EB-5 “School of Hard Lessons” side by side with me for these past few years. Greg is one of the brightest minds in U.S. hospitality management, widely respected, and literally the author of a leading textbook on Hospitality Management.
- The project, a Residence Inn Hotel in Seattle, is being developed by Navin Dimond and his veteran team at Stonebridge Companies. Navin, like Greg, is another hospitality industry maestro. He’s been honored the Award of Excellence from the American Asian Hotel Owners Association, the Hotelier of the Year Award from the Colorado Hotel and Lodging Association and the prestigious Hilton Hotels Multi-brand Developer of the Year Award.
- The formula and structure for the project mirrors what Stonebridge has done dozens of times before, providing prospective EB-5 investors with real-world, verifiable proof of success in both the business model AND, more importantly, exit strategy.
If you’ve been reading my blog for awhile now, you know the trials and tribulations of the past few years as we’ve brought Lake Point EB-5 to success. For us, despite being blessed with a Forbes 400 powerplant under the hood, the path to EB-5 success was essentially trial and error; EB-5 was an afterthought after the GP had already bankrolled 80% of the project.
(For Lake Point, the fact that our project is an existing and NOT “distressed” business continues to be a primary draw for our investors.) American Bridge is, IMHO, “an entirely new breed” of Regional Center simply because it is, to my knowledge, the first “new construction” EB-5 project which is predicated upon a verifiable and proven business model which the principals have replicated successfully dozens of times over two decades. Navin, Greg, and their team bring a depth of industry experience to the EB-5 business that few Regional Centers can match (100+ hotel projects and $3 Billion of transaction experience). And THAT, folks, is why I am proud to have structured American Bridge EB-5!
Greg is also looking beyond the Regional Center format as far as the EB-5 solutions he wants to bring to market. He’s told me that American Bridge will also carve out a new niche in the EB-5 market by hosting select Direct EB-5 projects which are customized to meet the needs of the individual investor. In fact, he’s currently marketing a number of restaurant and commercial laundry projects to EB-5 investors, offering innovative terms (all structured to comply with USCIS rules, of course) such as equity conversion options, profit participation, cash flow “lockboxes” for the benefit of the EB-5 investors, and loan maturity mechanisms that are triggered upon approval of the I-829 application. VERY cool stuff.
I’ve said for years that our Lake Point project was the ONLY real “investment” in the EB-5 market place because our equity EB-5 partners are par for par with the General Partner on ROI: if our GP makes 50%, so do our EB-5 investors; if our GP loses 50%, so do our EB-5 investors. Bona fide risk, tempered with a Forbes 400 GP with a sterling reputation. Greg’s view toward creating innovative solutions for individual EB-5 represents anotherstep in the right direction — protecting the investor — which has been sorely lacking in the EB-5 marketplace.
CONGRATS TO TEAM AMERICAN BRIDGE!
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