Developers

Why EB-5?

For commercial real estate developers, EB-5 financing is an attractive source of capital – especially since developments ideally suited for EB-5, like hotels, are among the most difficult to receive non-recourse construction financing using traditional capital sources.

Our company offers the ability to provide non-recourse capital and, depending on the project, this can take the form of a senior loan, mezzanine loan, preferred equity, or joint venture equity.

While all asset classes are eligible for EB-5 financing, certain project types generate more jobs, and therefore support a larger EB-5 allocation in the capital stack.

General Project ParametersI-526

Every project is unique. Aside from being located in a 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 total cost
  • Complete projected capital stack at the start of fundraising
  • Clear 5- to 6-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/entitlement approvals in place
  • Groundbreaking projected within 8-12 months
  • Strong government support and/or participation (can range from letters of support to actual financing, grants, or land contribution)

Checklist for Potential Borrowers

Project Timeline

  • Anticipated closing date for financing and commencement of construction
  • Construction schedule for entire project (showing construction spend by quarter)
  • 5-10 year pro forma - quarterly during construction period and annually post occupancy

Project Information

  • Detailed program including square footages by component
  • Information on any brands associated with the project including anchor tenants
  • Itemized development budget
  • All hard costs including FFE and TI allowances
  • Soft costs including acquisition
  • Leasing plan (if applicable)
  • Ownership organizational charts for business entities and borrowers
  • Major participants in the project, if identified, including: architect and general contractor
  • Bios of key development team members
  • Sources and Uses
  • Sources: estimate of complete capital stack, including public and private funding
  • Uses: should match development budget
  • Public letters of support as available, especially as related to public funding
  • Complete non-disclosure agreement

Underwriting

  • Any available, recent feasibility or market studies pertaining to the project
  • Personal financial statements for borrowers
  • Financial statements of any entity or individual that may guarantee the project

SIBK focuses on providing capital for the highest quality brands that have a track record for success.

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