‘In­vestors see more sta­bil­ity in prices due to the US econ­omy’s wide base’

HT Estates - - FRONT PAGE - Nam­rata Kohli ht­es­tates@hin­dus­tan­times.com (Nam­rata Kohli tracks ev­ery­thing from House to Home, from real es­tate to in­te­ri­ors and cap­tur­ing key trends in prop­erty mar­kets in In­dia and glob­ally)

Founded in 2010, the U.S. Im­mi­gra­tion Fund (USIF) pro­vides op­por­tu­ni­ties for for­eign in­vestors and their fam­i­lies to ob­tain per­ma­nent U.S. res­i­dency through the EB-5 Visa Pro­gram. The EB-5 pro­gramme, launched by the US gov­ern­ment in 1990, en­ables high net worth for­eign in­vestors to ob­tain a US visa for them­selves and their fam­ily by in­vest­ing a min­i­mum of USD 5,00,000 in a US business that help boost econ­omy while cre­at­ing at least ten jobs for Amer­i­can work­ers. USIF, which is in the business of rais­ing EB-5 cap­i­tal, aims to raise $125mn in for­eign in­vest­ment from In­dia over the next 15 months by help­ing 250 In­dian in­vestors im­mi­grate to the United States. This money that will be de­ployed in var­i­ous on­go­ing and up­com­ing com­mer­cial and res­i­den­tial real es­tate projects in the US by lead­ing de­vel­op­ers, says Ni­cholas Mas­troianni II, Chair­man and CEO, USIF. Edited ex­cerpts:

Has any­thing changed in Trump era? The per­cep­tion is that it’s not easy to stay in the US any longer.

The Trump regime is pro-le­gal im­mi­gra­tion. The prob­lem is with il­le­gal im­mi­gra­tion. They are all for pro­mot­ing ini­tia­tives that cre­ate stim­u­lus for econ­omy and more jobs for Amer­cians, and bring for­eign in­vest­ment ‘back’ to the coun­try. The EB-5 visa pro­gram ben­e­fits all the stake­hold­ers - while it pro­motes in­vest­ment in US real es­tate projects that fuel the coun­try’s econ­omy, it helps many fam­i­lies live in the place of their choice by fast track­ing their cit­i­zen­ship process.

The big Amer­i­can dream of ownership of more homes and even cars is now giv­ing way to an idea of min­i­mal­ist living, rent­ing and leas­ing op­tions. With the emer­gence of the new ‘Uber’ gen­er­a­tion, an­a­lysts pre­dict that a few years from now, peo­ple may not ac­tu­ally be in­ter­ested in pur­chas­ing ei­ther homes or cars. Do you think things are get­ting re­de­fined in the con­text of changing so­cial and eco­nomic val­ues?

The fact of the mat­ter is that till date, 75% of our H1B cat­e­gory is bought by In­di­ans with the re­cent num­ber be­ing 110,000 H1B visas.

The Trump ad­min­is­tra­tion has cat­e­gor­i­cally in­di­cated that it does not want US jobs to be given away to for­eign­ers and hence H1B is not an op­tion. Hence comes the con­cept of EB-5 visa pro­gram that al­lows for­eign­ers to study in the US, buy houses, and make a life in the coun­try of their choice. There is grow­ing in­ter­est in this Pro­gram from three cat­e­gories of peo­ple in In­dia, but par­tic­u­larly stu­dents, business en­trepreneurs and pro­fes­sion­als.

The U.S. Congress cre­ated the EB­5 Pro­gram in 1990 to en­able high net worth For­eign In­vestors to ob­tain a U.S. Visa by in­vest­ing in a U.S. business that will ben­e­fit your econ­omy. What are the ben­e­fits of EB­5 In­vest­ment Pro­gram for In­di­ans?

The best part is that it is for the en­tire fam­ily. The wife, kids below 21 years are also el­i­gi­ble to mi­grate to US and there is no wait­ing list for In­di­ans. Even though for China, it is for seven years. The EB-5 is one of the fastest ways to im­mi­grate to US. It al­lows you the flex­i­bil­ity to live and work any­where in the US. No spon­sor­ship is needed from em­ployer or fam­ily mem­ber and one can move freely. Also with H1B visa, you are paid much less, whilst with EB-5, you can be earn­ing dou­ble the amount.

What’s driving de­mand for US res­i­den­tial prop­er­ties for In­di­ans­ steady re­turns and the fact that prices are still near the bot­tom?

US prop­er­ties of­fer ap­pre­ci­a­tion and sta­bil­ity, both. The US dol­lar is a hedge against the drop­ping ru­pee and the drop­ping yen. Some non-US in­vestors pre­fer to get coun­try di­ver­si­fi­ca­tion by pick­ing up prop­erty in the US. Not only do they get an as­set in a for­eign coun­try, but the as­set is de­nom­i­nated in US dol­lars, which is still the cur­rency of choice around the globe. Given the di­ver­sity and wide base of the US econ­omy, in­vestors see more sta­bil­ity in prices.

It seems Chi­nese na­tion­als are biggest buy­ers of res­i­den­tial prop­erty fol­lowed by Cana­di­ans, Bri­tish, Mex­i­cans and In­di­ans. What are the char­ac­ter­is­tic dif­fer­ences in buy­ing pat­terns and pref­er­ences?

The Chi­nese love to in­vest in hi-value prop­er­ties and they are seen in­vest­ing in the range of 3 mil­lion dol­lars up­wards. They go for key ad­dresses and love the New York city. Mex­i­cans like to buy down south, in ar­eas such as Dal­las, Florida, Texas, that are closer and con­nected to Mex­ico. The In­di­ans like spa­cious homes in the sub­urbs and neigh­bour­hoods and they are not very par­tic­u­lar about ad­dresses. They know their num­bers like no one else does and are smart in­vestors. They are ex­tremely de­mand­ing and want to un­der­stand the de­tails much un­like the Chi­nese who just pay up.

Ni­cholas Mas­troianni II

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