EB5 Investors Magazine Volume 7, Issue 1 | Page 78

EB5 INVESTORS M AGAZINE 76 that project has an exemplar and is still on the market. Times have changed. But this was a tactic to spin the truth. The truth of an exemplar is that they are great to have but not all are created equal. An exemplar approval means that a set of project do cument s — i nclud i ng t he pr iv ate placement memorandum, an economic report, business plan, op er at i ng (or pa r t ner sh ip) ag re e me nt, es c row agreement, subscription documents, sample I-526 and supporting documents — has been submitted to and approved by the USCIS. It does not mean that the project is good or bad from a financial An exemplar approval means that a set of project documents...has been submitted to and approved by the USCIS. It does not mean that the project is good or bad from a financial perspective. ” perspective. It also does not go to the merits of the project. It does not mean that USCIS believes the project will actually start or finish. It simply mea ns t hat t he documents subm it ted are EB-5 compliant. This is helpful. No one can argue this. But is it dispositive of a good project? No! A recently approved exemplar project may be great. But it would be wise to consider some additional factors that will make the exemplar more valuable, suc h a s: w het her t he proje c t ha s st a r te d a s of the date of the approval (and, if so, how much is completed); how many investors the project has subscribed; whether there is a minimum amount of investors for the project to take EB-5 money; and when the deadline is to subscribe the investors. If the answers to these issues are not favorable, a n e xe mpl a r-approve d proje c t m ay not b e to o valuable. If the answers are favorable, then the exemplar may be much more valuable than other exemplars in the market. Many have aged well. In fact, an older exemplar could be the strongest project on the market based on those factors. MISCONCEPTION 2: ALL COLLATERAL IS THE SAME Another misconception is that all collateral is the same. While most developers intend to pay the investors back