EB5 Investors Magazine Volume 1 Issue 2 | Page 29

Claveran Law Firm EB-5 Immigration Attorneys “Changing the world one client at a time” Call your EB-5 Experts For Free Initial Consultation 45 Over years of combined legal experience with business & civil litigation and immigration law 5199 Pacific Coast Highway, Suite 508 • Long Beach, California 90804 Telephone: 562-494-2828 • Website: www.EB5VisaAttorneyLongBeach.com only be able to use construction jobs because operations will not occur within two and a half years of I-526 petition approval. If construction is starting with other financing (such as developer equity or bridge financing) or construction is only 24 months for example, the economic report may be able to use the first year of revenues if operations will start within two and a half years of I-526 approval. Stabilized occupancy that may occur some four to five years in the future is almost always outside the USCIS-imposed job creation timeline. Visitor spending is another input that can be used by an economist to calculate job creation in the hotel context. The economist will use a study (usually from a convention/visitor’s bureau) that will calculate the average amount of money spent per night by visitors to the area. The economist will then multiply that number by the occupancy rate of the hotel to determine the revenues the hotel guests will generate in the area through visitor spending. The visitor spending revenue then is used as an input to the economic model to calculate additional job creation in and around the area. Visitor spending has received much scrutiny. USCIS wants the hotel to demonstrate that the hotel is the reason why visitors are coming to the area, but it is very hard to show this causation in most cases. The decision on whether to use visitor spending in the job creation calculation requires a very fact-specific inquiry for each case in which it is considered. The Feasibility Study It is always important to provide independent data to support key facts in the Matter of Ho business plan. A hotel feasibility study should support the RevPar, ADR, and occupancy rates for the hotel, which are then used to create the revenue projections in the business plan, which, in turn, are used by the economist to calculate operations jobs. HVS regularly conducts hotel feasibility studies for EB-5 purposes, which gives background and support for the data contained in the Matter of Ho business plan. A best practice is for the assumptions in the business plan, including RevPar, ADR, occupancy rates, and revenues for the hotel, to come directly from the feasibility study. When you follow these key points, EB-5 can be an integral piece for your next hotel project. w w w. E B 5 I n v e s to r s . c o m ★ Jennifer Hermansky is an Associate in the Philadelphia office of Greenberg Traurig, LLP. Jennifer concentrates on EB-5 immigrant investor visas. She works with developers across a variety of industries seeking capital for new projects that qualify for EB-5 investments and counsels clients on the creation of new regional centers, amendments of a regional center designations and adoptions of developer projects by existing regional centers. She also counsels approved regional centers on an ongoing basis on a