EB5 Regional Center Profiled by Salt Lake City Newspaper

September 2, 2010 by Michael Gibson
Filed under EB-5 Visa News

Utah company looks to secure foreign investments with visa lure:

Veteran political adviser Stephen Studdert is a leading figure in an Orem-based company that has received federal approval to help foreign entrepreneurs invest in Utah businesses in exchange for work visas and, eventually, U.S. citizenship.

Mountain States Center for Foreign Investment was designated Aug. 11 as Utah’s first “regional center” by the U.S. Citizenship and Immigration Services (USCIS).

Designed to promote economic growth, these centers link up foreigners interested in obtaining U.S. green cards, known formally as EB-5 visas, in return for a minimum $500,000 investment in companies that can be shown to create or preserve at least 10 American jobs.

“We’re excited to be at the forefront of this,” said Heath Westfall, a Brigham Young University graduate and former venture capitalist who is president and CEO of the Mountain States Center.

He works closely with Studdert, who was an adviser to Republican presidents Gerald Ford, Ronald Reagan and George H.W. Bush, and with Studdert’s sons, David and Michael; and corporate attorney Bryce Higbee.

“This is a great opportunity to help Utah grow. We’ve been one of the country’s fastest-growing states, and there are lots of opportunities for growth,” Westfall said. “Our job is to help potential investors see what’s available.”

Mountain States Center’s focus is on the hospitality industry, particularly attracting investment in Marriott-branded properties developed and/or operated by Z H Lodging, a company Westfall has worked with since 2006.

But it also is authorized to pursue foreign investments that could be used in Utah and other parts of the West in fields as varied as horse ranch development, high technology, health-care services and innovation, entertainment, education and infrastructure.

Without providing details, Westfall said “we have several projects around the state that are in the pipeline. We anticipate having all of the funds put together for our first project in 60 days.” He added that center officials have been in discussions with investors in China, the Middle East, Japan, Russia and several other countries.

Although the once-obscure EB-5 visa program has been around since 1990, interest has increased substantially since the recession began. The number of capital-investment visas issued by USCIS jumped from 806 in fiscal year 2007, before the financial meltdown occurred, to 4,218 last year.

Citing State Department figures, the Washington, D.C.-based Migration Policy Institute said 3,340, roughly 79 percent, were issued to applicants from Asia, 1,979 to Chinese nationals.

“This trend may indicate the EB-5 investor visa program is becoming an especially attractive option for wealthy foreign nationals who might otherwise face long backlogs in family- or employment-based visa categories,” said Institute report authors Muzaffar Chishti and Claire Bergeron.

In addition, the number of “regional centers” authorized by USCIS to ease the flow of foreign money into U.S. businesses has grown markedly. There are 112 in 32 U.S. states, Washington, D.C. and Guam. Congress recently agreed to extend authorization of the centers for three years amid bipartisan efforts to make them permanent.

“As we were working on other international projects, this program came up on the radar,” said Westfall, noting that Mountain States Center gets a management fee for assembling deals and equity in the financed venture.

The program requires foreign investors to put $1 million into a business in a “targeted employment area” where the unemployment rate is 150 percent of the national average. The requirement is reduced to $500,000 for rural projects, the area where Utah fits in because the state’s unemployment rate is below the national average.

To qualify for an EB-5 visa, a foreign investor initially applies for a conditional visa that requires submitting a business plan and detailed economic analysis showing how the money will create or preserve jobs, either at the recipient business or in companies that support it.

Photo available through Creative Commons License.