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Bolstered by a strong economy and the rising Yuan, Chinese immigrants are investing millions of dollars in United States real estate, especially in San Francisco and other large markets recently affected by the housing market crash.
According to USA Today, Chinese immigrants and Chinese citizens now buy more U.S. real estate than any other foreigners excepting the Canadians – and many are buying multi-million dollar homes and commercial buildings. In the last year alone, the Chinese have bought $7.4 billion in property on American soil – a 24 percent increase over the year before. Why are they buying? Many say they are investing their money, while others are housing their student children, making business choices, or doing so for immigration purposes. Others say they are buying land in the United States because mainland China does not allow residents to own their own land.
Many Chinese immigrants are buying land because of the EB-5 investment visa program – a program that allows immigrants to live and work in the United States after investing $500,000 to $1 million into new American companies and new American jobs.
Currently, about 78 percent of those taking advantage of the EB-5 visa program are Chinese, and a large number of these settle in the San Francisco Bay Area. According to a California real estate agent, many Chinese buyers in the area are business executives seeking second homes costing over $800,000.
China currently has almost one million millionaires – and a recent study found that almost half of that number are investigating moving to or investing in the U.S.
As more and more Chinese nationals consider foreign investments, California’s Bay Area and the federal government’s EB-5 investment visas are becoming more and more popular. China’s economy is booming – and creating millionaires. Many of these newly wealthy businessmen and women want to continue their success, but also would like to live and work in America.
The EB-5 program allows them to invest as little as $500,000 in a U.S. project that creates ten American jobs for two years. In exchange, their spouse and children under 21 are granted permanent residency.
The popularity of this program has skyrocketed in recent years, especially among Chinese immigrants and especially in the Bay Area, which has a large population of Asian immigrants and a close proximity to China. Seventy-seven percent of all EB-5 applicants were Chinese in 2011, and applications are up 700 percent since the program began 22 years ago.
What do lawmakers think of the program? Many are excited that EB-5 visas bring money and jobs to the country without risk or cost on the government’s part. Many are also excited at the prospect of Chinese immigrants looking for green cards deciding to fund Oakland projects like hotels, shopping centers, professional athletic facilities, and possibly even a new A’s baseball stadium.
After immigrants began to help fund the new New Jersey Nets stadium and shopping complex in Brooklyn through the EB-5 investor visa program, Tampa Bay officials are considering using the same avenue to attract investors to their new half-billion-dollar Rays Stadium.
Beginning in 1990, The EB-5 investor visa program allows wealthy foreigners to gain a temporary visa to the United States through investing $500,000 to one million dollars in a project that results in new American jobs. If the investment succeeds in creating ten jobs over a two-year period, investors and their families are eligible for a green card. In recent years, around 3,500 foreigners begin the EB-5 immigration investment process.
Immigrants can invest their funds in a variety of ways, but the United States Citizenship and Immigration Services (USCIS) must approve projects. In recent years, a number of cities have become increasingly aware of the EB-5 program and how it can help large projects come to fruition while also creating local jobs. After the New Jersey Nets utilized the program to create a new basketball arena (and larger development area), others sports organizations are researching whether immigrant investors can help grow their franchise and bring more prosperity to the area.
Tampa Bay and Brooklyn are not alone – Oakland, California, is considering their own basketball stadium funded in part through EB-5 investments after another source of funding fell through.
Mahnaz Khazen, founder of the San Jose, California U.S. Immigration Investment Center, is hoping to use the EB-5 visa program to make it easier to assist troubled community banks in the Washington area. This would be the first time the EB-5 visa program would be used for investment banks.
Khazen believes that the EB-5 visa program can assist community banks by granting the visa to immigrants in exchange for an investment of $500,000 to $1 million. Then banks can help small businesses in the area by providing loans, allowing for reinvestment and the creation of jobs. Through the EB-5 visa program, Khazen has already arranged for five foreign investors to provide money to Gaithersburg’s Harvest Bank of Maryland.
Khazen opened her company in August and targeted some of the hardest-hit banks in Florida and on the West Coast before focusing on stronger economic regions of the United States.
Harvest Bank ran into trouble after it purchased a portfolio of mortgages from Countrywide Home Loans in 2006, and now with $164.3 million in assets, the bank is considered undercapitalized. For the past 24 months, the bank has been trying to recapitalize by raising $16 million.
Based on the number of current investors and the amount being floated to the bank, Harvest is approaching the $16 million it needs to recapitalize. According to John McDonnell, chairman and acting chief executive of Harvest Bank, once the goal is reached the bank will have to submit the structure of recapitalization to the regulators, which will take time for approval. McDonnell remains optimistic at the prospects of recapitalization.
If the Harvest application is approved, Khazen has other banks in the works. She currently has funds and applications, with an additional 200 inquiries from foreign investors.
A recent report in the San Francisco Examiner has declared that the EB-5 program is becoming increasingly popular and could lead to an influx of hundreds of jobs and tens of millions of dollars in investment in the Bay Area. The EB-5 Investor Visa program offers foreign investors a path to a green card if they make a qualifying investment that will create or maintain 10 American jobs.
The program has become “a focus of global entrepreneurs,” says author Niko Kyriakou, as investment money is in demand and investors looks for new ways to stimulate economic growth. U.S. Citizenship and Immigration Services (USCIS) told the Examiner that more EB-5 visas were requested last year than in any other year since the program began in 1990. Since its inception, the program has created over 40,000 jobs and gathered over $2.1 billion in investment.
California has also seen massive growth of the program, particularly in the form of numerous Regional Centers, which are federally-approved funds. In the last two years, 30 additional regional centers have cropped up in California.
With all this growth, backers of the EB-5 program, including many San Francisco immigration attorneys, are confident that the program will continue to fulfill its promise to achieve its goal of stimulating investment and economic growth in exchange for immigration.
A recent article in Business Week confirmed what San Francisco immigration lawyers already know: the EB-5 Visa is growing in popularity, especially among Chinese citizens.
Competition for wealthy Chinese investors’ dollars is heating up. The article reports that there are over 500,000 Chinese citizens with assets of over 10 million yuan ($1.57 million US dollars), and a study showed that almost 60 percent are considering emigrating, have begun the application process, or have emigrated. These immigrant investors are looking to get residency permits (or Green Cards in the US) mainly from the U.S., Canada, Australia, Singapore, and New Zealand. In the U.S., the EB-5 Investor Visa program offers a channel for these type of immigrant investors to gain residency in exchange for investment dollars that create jobs and economic stimulus.
Most émigrés are not looking to leave China permanently, says the author, citing a study by the Bank of China, which found that about 80 percent of wealthy Chinese immigrants don’t plan to give up their passports. Many families choose to send one parent and the children abroad while another parent spends more time in China, managing business. The study revealed that many wealthy parents are hoping to find the best educational opportunities for their children by going abroad.
The House Judiciary Committee's Immigration subpanel reviewed two immigration programs this past Wednesday that both parties believe may improve the United States economy and help more Americans find jobs - especially in the science and technology sectors.
First, lawmakers discussed the EB-5 investor visa, which has been in place since the Immigration Act of 1990 but is set to expire next year. While most lawmakers believe that continuing the visa program - which allows foreign entrepreneurs to enter the country after investing $500,000 to $1 million into a U.S. business - is good for both job creation and the greater economy, some conservative politicians see the program as offering aliens green cards in exchange for cash.
Second, the lawmakers discussed a possible new visa program, now called the Start-Up Visa, which is part of a bill proposed by Representative Zoe Lofgren, a Democrat from California. The visa would award conditional residency to immigrants who wished to start a new business in the United States. Those who were successful after two years of business would be given the option of permanent residency.
Although many lawmakers applauded the potential of the start-up visa to create new business, add jobs, and take advantage of the most talented and ambitious businesspeople in the world, some Republicans were wary that the visa program could lead to a number of cases of fraud and abuse.
If you have questions about the EB-5 visa or Start-Up Visa Program, contact a California EB-5 Attorney today.
TORONTO - Luminato, the festival of arts, culture and ideas that just concluded in Canada's largest city, has only been held for four years. But this citywide extravaganza already attracts a collective audience in excess of 1 million and spends millions of dollars on the commissioning of expansive international creations like Tim Supple's "1001 Nights," a show that used 24 actors from across the Middle East and that was supposed to then come to the Chicago Shakespeare Theater before visa issues killed, or at least postponed, the booking.
But for all the lofty artistic aims spoken at Luminato, which claims to be the largest multi-arts festival in North America, one message here rings the loudest and the clearest: This festival was created to promote its home city and build its cultural prestige around the globe. Or, as the manifesto of the co-founders puts it: "to shine Toronto's light on the world and the world's light on Toronto." You can't say it much clearer than that.
Surely, there are several lessons here for Chicago, a city that desperately wants to improve its international reputation and currently minimal share of foreign tourists. According to figures from the U.S. Department of Commerce, Chicago's share of international visitors to the U.S. actually shrank between 2009 and 2010: from 4.7percent to 4.5 percent, a share already below that of much smaller cities like Boston. In 2010, Toronto attracted roughly 2 1/2 times as many international visitors as Chicago.
Aside from the speedier processing of visas for international artists in Canada, there's another way you know you are no longer in the United States: Luminato makes only about 10 percent of its $13 million annual budget at the box office. In fact, most of its biggest events, like this year's outdoor k.d. lang concert, are free. More than half of its funding comes from the various levels of government: city, provincial and federal, with Ontario carrying the lion's share. Remarkably, the province has given Luminato a separate $15 million grant, to be used specifically for the funding of new works. It has commissioned, or co-commissioned, more than 40 in five years, coming up with premieres from the likes of Philip Glass, Robert Wilson, Leonard Cohen, Atom Egoyan and Robert Lepage.
Janice Price, the executive director, claims Luminato pays off handsomely, and in multiples, for all its stakeholders. Citing figures calculated using government formulas, Price says last year's Luminato spawned more than $132 million in visitor expenditures, with most visitors saying Luminato was the main reason they were in Toronto. And those are Canadian dollars that, thanks mostly to the way Canadian banks avoided excessive exposure to toxic mortgage-backed securities, are currently worth slightly more than U.S. greenbacks. And then there is the matter of a changed perception.
"We needed to improve our brand on the world stage," said Price, in an interview in her office. "People still thought of Toronto as a bunch of white guys wearing parkas. But 50 percent of the population of Toronto was not born here."
Luminato was born from a big idea forged by two businessmen: David Pecaut and his friend Tony Gagliano. (Pecaut, a Toronto-loving American and a partner at the Boston Consulting Group, died of cancer in 2009.) Right from the start, the pair, regarded around town as masters of influence in corporate and governmental circles, had little time for incremental growth. In big cities like Toronto or Chicago, they argued in their early proposals, no one pays attention to small events. It was, in Chicago-style language, a case of making no small plans and raising no small amount of money.
At the start of their planning, Toronto was more than ready for a stimulus of the cultural sort. The city was reeling from the 2003 SARS viral infection crisis that crippled its international tourism. In the years that have followed, passport requirements and the decline in the U.S. dollar contributed to a massive falloff in visitors from the United States. In an interview, John Karastamatis, a spokesman for the powerful Mirvish organization, which presents Broadway and West End shows in Toronto, said the U.S.-based audience for big shows in Toronto has dropped precipitously from as high as 50 percent during the summers of the early 1990s to, currently, less than 2 percent. The Mirvishes, who control many of the downtown venues here, have thus had to reinvent their entertainment operations as a domestic Canadian entity. (According to research commissioned by Broadway in Chicago, Chicago has received some of the benefits of cultural tourists from, say, Michigan, who would, in the 1990s, have been much more likely to go to Toronto.)
But Luminato has set its sights on the international market, where Chicago's draw was and is weak.
Pecaut and Gagliano decided that Luminato had to be composed of two main elements: prestigious, large-scale international works that would attract far-flung visitors and global media attention and that would allow Toronto to both partner and compete with such existing festivals as the ones in Edinburgh, Scotland; Sydney; and Avignon, France (all of which enjoy ample public support).
And then there had to be something different for the locals, something more at the street level to generate ownership and excitement. In general, that has meant free pop and rock concerts and generous commissions to local arts groups to create new work that would become part of the festival and make it appealing, for example, to the trendy young urbanites who live in Toronto's many downtown lofts. As a result, studies show that significantly more than half the attendees at Luminato are younger than 34. And cultural professions are happy. "We give our local artists the chance to dream a bit," said Chris Lorway, Luminato's artistic director, in an interview during this year's festival.
Pecaut and Gagliano further determined that Luminato must focus on what they called "unique events," thus refusing to cobble together a festival from ordinary existing programming (collectively marketing previously scheduled events is a common way to attempt a festival on the cheap).
Over the years, "unique events" has translated into the premiere of an opera by singer Rufus Wainright or an oratorio by Monty Python's Eric Idle. Unlike most U.S. festivals, which tend to be highly segmented, Luminato has promoted a judicious and highly eclectic mix of pop culture and the so-called high arts. It also has found a prominent place for books and ideas. This year's festival had magic and fashion events. A partnership with The New Yorker magazine this year produced a variety of programming, including talks on current events and phenomena by the likes of Malcolm Gladwell, David Remnick and the Chicago-based writer Ted Fishman, who, spotted on the plane from Chicago to Toronto, said he was going to Canada to get the chance to talk about China.
Commissioning is a key to the Luminato formula. In the case of "1001 Nights," for example, Supple was struggling to get funding for the research-and-development portion of his project - which involved finding actors from throughout the Middle East who could collaborate on a kind of reclaiming of "1001 Nights," creating an Arab version of an Arab story.
"I was really struck that no one was doing work from that region," Lorway said. "I thought the R & D was the most interesting piece of what Tim was doing."
So Lorway and Price came up with more than $1 million in funding, and Luminato had the premiere - and a royalty interest - in a show that Edinburgh will present this summer.
Much of what Luminato does in Toronto already exists in pieces in Chicago: International theater programming comes to the Chicago Shakespeare Theater (which, in the newly announced plans for Navy Pier, is likely to get an additional large venue) and the Goodman Theatre; the Chicago Humanities Festival offers programming based on ideas; the Tribune-owned Lit Fest features authors and their books; Just for Laughs, a Canadian import, focuses on comedy. But none of these has the power alone to fill a huge city's hotel rooms or draw international media.
It would be wrong to characterize Luminato as wholly secure or universally supported. In a recent article, The Globe and Mail questioned whether the festival could sustain its level of support in the face of governmental change and a new emphasis, at all levels of government, on austerity. And internal change is also in the works: Lorway, the man who commissioned Supple's "1001 Nights," an earthy, sexual and exceedingly long show that did not attract capacity houses nor retain all of those who did show up, is leaving his post this summer. Still, even though some of its commissions struggle, Luminato explodes all over Toronto for 10 days in June.
The closest Chicago has come to Luminato was perhaps the International Theater Festival, which existed from 1986 to 1994 (festivals were only held every two years) and the eventual demise of which is often held up as evidence of the difficulty of creating international cultural festivals in a city with so many arts nonprofits competing for resources.
But Jane Nicholl Sahlins, who ran that festival, argues that the time is now right to explore the idea again. "When we started, people internationally would say, 'Chicago? Where's Chicago?'" Sahlins said. "Now they would not say that. And at that time, we were not a priority within the city. And the city has to be behind this kind of thing."
Of course, it takes money to run a festival like Luminato, as Sahlins well knows. You have to find the right time of year. You have to create work as well as just present it. There has to be buy-in from turf-aware local institutions, with which Sahlins says she often found herself competing for scarce funding.
But while there is international work at Luminato, it is not an international festival but a celebration of an international city. A city whose hotel rooms it fills for a good chunk of June. That, perhaps, is a crucial distinction. Luminato doesn't just bring in work from outside; it also creates work from within and then shouts about it globally. Furthermore, as Price noted, festivals are a different beast. They help people follow the arts. "You can't just hit them with a wall of stuff," she said. "You have to provide context."
Intriguingly, Price argued that free events are actually far more attractive to corporate sponsors like L'Oreal, one of Luminato's biggest supporters.
"If you are in a big, beautiful park getting an artist the caliber of k.d. lang for free," Price said, "you appreciate the sponsor. And you don't mind if you see a couple of banners."
Perhaps in Chicago, you do not entirely have to start from scratch.
"I have often wondered why somebody doesn't combine something with the Humanities Festival," Sahlins said. Through a spokesman, those who run the Humanities Festival said they would be "fine with that."
Perchance in such a marriage, or a similar union, lies Chicago's Luminato.
Maybe. It takes an upfront investment and a big communal buy-in. And if you follow the Luminato model, you don't ever try to build anything up slowly.
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From the Beatles to the White Stripes, there has long been a thriving musical exchange between the UK and the US. Now though, the trans-Atlantic trade in bands could be turning into a one-way street due to increasingly restrictive US visa laws, according to punk rocker and journalist John Robb.
The Membranes founder member and current Goldblade frontman has teamed up with opposition Labour MP Kerry McCarthy to highlight the problems faced by UK groups thanks to the complex and costly visa application process and demand that the government push for more leniency on the part of the Americans.
"In the past few years the American visa situation has tightened up and become far more expensive," Robb said. "We have a situation where getting a British group into America can cost up to £2,700 ($4,400), and that's not counting travel and accommodation expenses for bands outside London who have to travel for the 8AM London American Embassy interview. The forms that have to be filled in are very difficult to understand and lots of money has to be spent on an American agency processing [them]."
Robb and McCarthy will meet Tory Culture Minister Ed Vaizey next week to argue their case, the NME reports. McCarthy, who spoke about the issue in Parliament in March, hopes the government will pressure the US Embassy and immigration services to rethink their current policy towards British musicians.
Post Sept. 11 changes to US work visa rules have seen last minute tour cancellations become a regular feature for bands hoping to perform shows in the US. Glasvegas, Guillemots' Fyfe Dangerfield, the Pipettes, the Mystery Jets and Speech Debelle are among the many UK artists who have been forced to nix or rearrange planned stateside trips in recent years.
"American bands find it far cheaper and easier to travel and work in the UK," argued Robb, whose campaign is being backed by the Musicians' Union, the Association Of Independent Music and the Association Of British Orchestras. "What we need is a fairer and friendlier system that will break down the barriers, and let us do what we do, which is play music."
Is the L-1 work visa for inter-company transfers being improperly used by companies in order to move more work overseas? Should many L-1 visa applicants actually be applying for HB-1 visas instead? What is the definition of “specialized knowledge” – a phrase that appears in the guidelines for L-1 visa applicants?
Recently, a number of labor unions and other organizations have contacted the federal government about the dangers of relaxing the L-1 visa rules. At the same time, dozens of companies have sent letters to the U.S. government asking federal officials to reform the definition of “specialized knowledge” so that they can better utilize foreign workers.
In just the first week of accepting applications, over 20,000 people petitioned the United States Citizenship and Immigration Services for HB-1 work visas – in any given year, 85,000 such visas are available. At the same time, there is a wage requirement for workers who apply. The L-1 visa, on the other hand, has neither a wage requirement nor an application cap: two details which make the work visas more desirable for companies.
Those who oppose changing the definition of “specialized knowledge” say that changing the definition of the L-1 visa or allowing companies to interchange the L-1 and HB-1 visas would be harmful to the economy and result in moving more American jobs offshore.