Milbrath said he’s targeting the oil-rich Persian Gulf region—particularly Saudi Arabia and the United Arab Emirates—as well as countries such as China, Russia, Malaysia, Indonesia and Venezuela, which have produced many millionaires but also suffer from frequent political instability. “This program has to produce 10 jobs, but that includes indirect jobs,” he explained. “The focus of this program is to create American jobs, not necessarily to bring the immigrant here. But it gives that immigrant the ability to travel—especially if, for example, you’re in Venezuela and there’s a coup or the government takes over your business.” Hungerford said he expects that the EB-5 program will have more success in New Orleans than it has with other TEAs because this is the first time immigrant investors will have the opportunity to pool their money in a venture capital fund with other investors. Asked if anyone has raised objections over the idea of handing out green cards to wealthy foreigners in return for their investment dollars, Milbrath responded: “There is no opposition to this program. Every senator wants this economic development for his region. We expect that through our investment, we will create on the order of 5,000 to 6,000 jobs.” Hungerford and Milbrath could also make a sizeable amount of money for themselves, too. “When the immigrant makes his $500,000 investment, there’s a service fee of 12 percent, which we collect to cover our marketing and travel costs,” Milbrath explained. “We don’t pay New Orleans, and the city doesn’t pay us. We collect it directly from the investor, because the city cannot be in a conflict of interest with the investor. That’s why they need a private company like us.” Immigration lawyers will also benefit, even though the government does not require prospective EB-5 applicants to hire a lawyer. “Given the complexity of this process, you’d be a fool to try this on your own,” said Yale-Loehr, noting that only a few lawyers specialize in EB-5 visas, and that they charge anywhere between $10,000 and $20,000 to guide an applicant through the visa process. Hungerford, who was born and raised in Laytonsville, Md., has a master’s of business administration degree from the University of Rochester in New York. He operates rental properties in Montgomery County, Md., and has a background in finance and accounting. He also supervised four European offices for an international consulting firm based in Reston, Va. He described his specialty as “managing large projects and understanding the complexities of working with government agencies.” “The real focus of this is that the ventures have to be for-profit enterprises. It’s designed to be economically prosperous for the United States,” Hungerford said. “What’s really interesting about this program is that it’s a great example of a public-private partnership.” Hungerford said the NobleRecoveryFund as well as the NobleRealEstateFund will be capitalized at between $50 million and $100 million each. Under U.S. Securities and Exchange Commission law, each fund may have a maximum of 99 investors. “The funds can’t promise a specific return, but we think this investment has great potential,” Hungerford said, noting that “85 percent to 90 percent of our funds will be invested in underlying real estate.” Added Milbrath: “The government takes great pains to make sure this program works. Each state has specific securities laws that have to be complied with.” Despite the devastation wrought by Katrina, New Orleans has made tremendous strides since the disaster. According to the city’s Office of Economic Development, of the 22,000 businesses that operated in New Orleans before the hurricane, more than 17,700 of them, or 90 percent, have reopened. In addition, sales tax collections are at 78 percent of pre-storm levels, the city has granted 358 new business licenses, and 90 percent of “Class A” office space is currently occupied. Nearly 1,250 of the 1,800 restaurants that operated before Katrina are also back in business, and between 230,000 and 240,000 of the city’s 450,000 pre-Katrina residents have returned home. One of NobleOutReach’s chief targets for investment is an 18-acre downtown movie studio that will employ 3,500 people when completed and help New Orleans regain its pre-Katrina prominence as the “Hollywood of the South.” The company will also invest in extended-stay hotels, cold-storage facilities, neighborhood medical clinics and possibly casinos. “They seem very legitimate, and they want to do the right thing to help New Orleans recover from the hurricane,” said Yale-Loehr, adding that the project could have a huge impact on the city’s recovery efforts. “It depends on a lot of factors, including how good their marketing is. These are large projects, and the foreign investors’ money is combined with that of U.S. investors and banks. It’s a leveraged opportunity that allows large projects to go forward.” Larry Luxner is a contributing writer for The Washington Diplomat. For more information on EB-5, contact NobleOutReach at 301-502-8555

Would you like to become a WashDiplomat sponsor?