This year, proposed reforms to the EB-5 program were rejected again by the US Congress. In April, Washington announced that wait time could be up to 15 years for Chinese investors, which has prompted withdrawals of EB-5 applications by Chinese investors.
According to Sohu news, frustrated by such a long wait time, many Chinese EB-5 investors in major New York developments want their millions back. They are talking with attorneys about how to pull out of projects such as 701 Seventh Ave., 1568 Broadway and One Wall St.
When those Chinese citizens invested in the Times Square Edition Hotel through the EB-5 visa program roughly four years ago, they expected to secure green cards within five years. But the controversial program, which has brought billions into New York City real estate projects, is facing a major backlog in applications that has driven up wait times.
Dozens of Chinese investors, now facing lengthy waits, are considering bringing home their money, usually $500,000, and are prepared to forfeit their visa applications altogether.
The investors allege that the immigration agency that worked with the US Immigration Fund (USIF), Qiaowai, made a series of misrepresentations about the quality of investments and the timeline for green cards. They further claim Qiaowai told investors in April 2016 they would have green cards within five years, even though the backlog was known to be mounting, Sohu news reported.
Many of USIF's investors say they were not properly informed of the investment conditions on the front end, and that immigration attorneys also often don't explain the backlog properly, said Douglas Litowitz, a Chicago-based attorney who has been in touch with some EB-5 investors in 701 Seventh, according to Sohu news.
From EB-5's inception in the 1990s until about 2014, there had not been any backlog in the program. It evolved in the late 2000s into a convenient marriage between Chinese nationals hoping to secure a green card for their children's education and developers hungry for cheap debt in a market where it was scarce. But with the longer wait times, many Chinese see it as a bet no longer worth making: by the time the green cards come through, their children may be too old to qualify for permanent residency rights (the cutoff is 21).
