Why Eb5?
For commercial real estate developers, EB-5 financing presents a compelling capital source, particularly for developments like hotels, which often struggle to secure non-recourse construction financing through traditional means. Our company provides non-recourse capital, which can be structured as a senior loan, mezzanine loan, preferred equity, or joint venture equity, depending on the project. While EB-5 financing is available for all asset classes, certain property types, which generate more jobs, can support a larger EB-5 allocation in the capital stack.
Eligibility
At Summit Square EB5, we actively seek new investment opportunities and partnerships, working with a diverse range of project partners, from developers to companies across sectors such as retail and manufacturing.
To qualify for the EB-5 program, a project must be located in a Targeted Employment Area (TEA), which is either a rural area or one with an unemployment rate exceeding 150% of the national average. Summit Square EB5 can assist developers in determining if their project's location qualifies for TEA designation. We focus on urban developments within TEAs that generate a substantial number of full-time, living-wagejobs. We provide senior loans, mezzanine loans, preferred equity, or joint venture equity for projects involving owners and/or institutional equity partners.
General Project Parameters
Every project is unique. Aside from being located in a Targeted Employment Area (TEA), there is no one set of rules that will apply to all projects. The following general parameters can help you determine whether EB-5 financing might suit your project. A certain project does not need to meet all of these conditions, but the more conditions that are met, the better.
- Developer equity contribution of at least 20% of the total cost
- Complete the project capital stack at the start of fundraising.
- Clear 5- to 7-year exit strategy for EB-5 investors
- Proven track record of similar successful developments
- Experienced project team (general contractor, architect, etc.).
- Proven market demand with strong submarket fundamentals
- Zoning and entitlement approvals in place
- Under construction or groundbreaking within 8-12 months