Investors Repaid $122 Million
by Courtney Creedon
Bearing good news for investors and the EB-5 industry alike,
CanAm Enterprises and the Philadelphia Industrial Development
Corporation (PIDC) recently announced a landmark repayment
to investors. A sum of $122 million was repaid to 244 investors
after their involvement in the financing of the Pennsylvania
Convention Center. Often noted as the final measure of the success of an EB-5 project, CanAm joins only a handful of regional
center operators to have repaid their investors.
As program insiders will know, the road to repayment is a
long one and hinges on successfully meeting a series of milestones—namely I-526 and I-829 approval for investors and the
successful structuring, marketing, and operating of a project
for developers. When investors have proven the fruits of their
investment with an I-829 petition and received their green
cards can developers realize the exit strategy they had long since
proposed to investors. Any prior repayment would jeopardize
the investors’ ability to prove that they maintained an at-risk
investment for the duration of their conditional permanent
residence—a key requirement of the EB-5 program.
CanAm’s announcement marks the repayment of 244 investors, in full and on time. All of these investors had contributed
capital through a loan made by CanAm and PIDC to the
Pennsylvania Convention Center Authority. Their investment
partly financed the expansion of the Pennsylvania Convention
Center, with the goal of enabling it to better compete with
convention centers in other major cities.
Construction and operations jobs created by the project
totaled over 3,000—more than enough to satisfy I-829 requirements for the 244 repaid investors. Now, all of those 244 investors and their families have received unconditional permanent
residency and some have even obtained citizenship, according
to CanAm representatives.
While it seems the project was successful from an EB-5 point
of view, labor disputes in 2012 called into question the longterm viability of the enhanced convention center beyond the
EB-5 horizon. Many groups sidestepped Philadelphia in favor
of other cities due to concerns over inefficiencies and incompetent leadership. Recent reports, however, cite a renewed interest
in the convention center in the face of management changes.
The Philadelphia Convention and Visitors Bureau estimates
that returning groups “will spend a combined total of 114,314
nights in local hotels and generate $147.6 million in economic
impact.”2 John Grady, PIDC’s president, explains, “A project
like the Pennsylvania Convention Center expansion is an investment in the public interest. Even now, we are just seeing the
beginnings of those benefits. The true long-term impacts to the
city will come in the years ahead.”
Public officials, too, have demonstrated their confidence in
the project and their hopes for Philadelphia’s future. Governor
Rendell thanked CanAm and PIDC, saying, “The expansion has
had a significant positive impact to our hospitality and tourism
industry. We are grateful to CanAm and PIDC for their efforts.”
Investors are surely grateful too, with green cards and returned
capital in hand. Many are continuing to learn English, traveling
throughout the country, opening new businesses and settling
into their new homes, according to investor testimonies.
Overall, CanAm cites the total amount of investors they have
fully repaid at over 900, which includes a recent repayment to
95 investors in the first project of CanAm’s Los Angeles County
Regional Center.
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Von Bergen, Jane M. “Changes at Convention Center Luring Groups Back
to Philadelphi