2014 was a strong year for the commercial real estate market overall. Low interest rates helped bring in new capital, allowing the number of developments as well as the amount of inventory on the market to increase. This inventory increase in turn led to an increase in 1031 exchange activity.
Quite a few of those large CRE developments utilized EB-5 funding as part of their capital stack. EB-5 investment funds are now viewed as a mainstream source of capital for many large CRE developers and have recently been used on projects such as the Las Vegas SLS Hotel & Casino, New York’s Hudson Yards, and Seattle’s Stadium Place.
The EB-5 sector itself saw explosive growth for another year, with over 200 Regional Centers approved by the United States Citizenship and Immigration Services.
As overseas investors demand security, transparency, and compliance, it is crucial for EB-5 issuers to deliver these best practices for their investors while also improving their own operational efficiency to achieve project success. NES Financial’s leading EB-5 Solution Suite saw new products added, like EB-5 Immigration Workflow, that will help issuers achieve business goals all while maintaining investor confidence in the project. The 1031 exchange industry also continued to value these principles, as NES Financial safely processed more than $85B worth of exchange funds.
Some key achievements in 2014 include:
- Achieving record volume of 1031 exchange funds. We successfully processed over $85B in exchange transactions and helped our clients defer more than $13B in taxes.
- Extending EB-5 market leadership position. Over the summer, NES Financial announced the signing of our 250th EB-5 project, a milestone that is unmatched in the industry.
- Unprecedented adoption of EB-5 Fund Administration and EB-5 Immigration Workflow Solutions. In early 2014, NES Financial introduced EB-5 Immigration Workflow to our existing EB-5 Solution Suite. Over two-thirds of our client base is using one or more of these Solutions.
- Launching website in China. This website helps educate Chinese investors on important considerations related to the management of funds when selecting an EB-5 project.
- Introducing EB-5 Medallion Award Program. NES Financial’s Medallion Program recognizes EB-5 issuers who commit to upholding best practices by electing to use our EB-5 Solutions. The medallions are increasingly being recognized by investors overseas as a possible factor to take into account when selecting investment projects.
- Completing ninth consecutive compliance examination. Every year we voluntarily submit to undergo a rigorous compliance examination. This examination is consistent with those done for regulated financial institutions such as banks.
- Industry recognition. NES Financial was awarded the OutSystems Innovation Award for our eSTAC® technology
“As the economy continues to gain momentum, the market is embracing solutions that bring increased security, transparency, and compliance to specialized and highly-scaled financial transactions,” said Michael Halloran, NES Financial Chairman and CEO. “Again this year at our EB-5 Innovation Summit Seminar Series we will be introducing additional solutions that simplify processes for our clients and meet market demand. We look forward to continuing to work with our clients and expanding our solution set to meet their evolving needs.”
What is a 1031 exchange? Find out more by downloading our 1031 Exchange Kit.
What is EB-5? Find out more by downloading our EB-5 Solution Kit.
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