Oftentimes, real estate investment climbs in certain areas due to new development, the addition of thousands of jobs, or even tourism. However, in Greater Philadelphia, the reason why so many people are investing in real estate is a bit surprising.
The EB-5 Visa Program
The city of Philadelphia isn’t opposed to helping foreign immigrants get green cards in exchange for significant investments that add to the city’s massive growth. In fact, the EB-5 immigrant and investor visa program has generated more than $700 million for the city directly, and that money has been used to build 50 projects that have proven significant for the entire area. The federal program paid for things like the Francis House of Peace, the Comcast Center, the Philadelphia Convention Center, and more.
The Fear for the Future
The EB-5 program was created by Congress in 1992 to set aside visas for foreign investors who make necessary investments in commercial enterprises and plan to either create or preserve, through their investments, at least 10 full-time, permanent jobs for qualified US workers. The program was slated to expire on December 9, and there was fear that critical members of the Senate – and the Trump presidency, which seeks to tighten immigration laws – would prevent its continuance. Fortunately, this was not the case and the EB-5 program will continue to provide necessary funds for the development of Greater Philadelphia.
Is the Program a Good Idea?
Although there’s some speculation that allowing people to “buy” their way into the United States is never a good idea, the city of Philadelphia is a prime example of how the program boosts local economies and benefits everyone involved. Remember that the EB-5 program is for foreign entrepreneurs looking to start a business in (or relocate a current business to) the United States. This can only benefit Americans by providing or protecting jobs, and it also brings much-needed funds into areas known as Immigrant Investor Regional Centers – areas deemed by the federal government to be in the most need of such programs.
Will It Continue?
Although the federal government decided to continue the EB-5 program, and while Philadelphia’s Immigrant Investor Regional Center remains open for business, the truth is that some proposed legislature could still lessen the program’s impact in the city. Right now, apartment buildings, office complexes, and even new businesses are going up left and right across the area, but that could all change. In 2015, the program hit its 10,000 visa limit for the first time since its inception, and Philadelphia must now compete with other major cities for those visas. What’s more, Senator Patrick Leahy of Vermont and Senator Chuck Grassley of Iowa are pushing to bring more of those visas to rural areas, which would detract from the funding cities like Philadelphia receive.
Real estate investment is indeed booming in Greater Philadelphia, but not in the way many people may think. In fact, much of the funding used to complete some of the city’s largest building projects came from foreign investors. While that’s a great thing, there is uncertainty for the future as Philadelphia continues to compete with other cities and, if some US Senators have their way, even to rural areas in need of development.