After a grueling two-year application process, Miami Beach’s Hotel Astor has been granted EB-5 status by the U.S. Citizenship and Immigration Services office, The Real Deal has learned.
That means the 18 investors from Brazil, China, and Venezuela who are funding $9 million of the hotel’s renovation will be getting visas that pave the way for their permanent U.S. residency. The investors put in $500,000 each.
“We went through a review that was pretty brutal,” David Hart, a Hotel Astor managing principal, told TRD. “But in the end, USCIS agreed we have an EB-5 compliant project.”
Now, he and his partners can begin a long-awaited renovation of the Art Deco hotel’s 42 rooms and 5,000-square-foot restaurant space, as well as reinstalling a swimming pool in the garden just south of the property’s main building, Hart said.
Hart, an immigration attorney who specializes in connecting wealthy foreign nationals and project developers in the United States seeking capital from outside the country, joined the Hotel Astor team in 2012. A year later, he filed the EB-5 application on behalf of the hotel, located at 956 Washington Avenue in Miami Beach.
Established in 1990, the EB-5 visa program grants permanent residency to an investor — as well as to immediate family members — who funds at least $500,000 to $1 million of the construction cost for a project that creates at east 10 domestic jobs. It took off during the recession as developers turned to foreign investors due to the dried-up credit markets in the United States.
Although in recent years, USCIS has been inundated with EB-5 visa applicants, creating a backlog since only 10,000 visas are allotted annually. By far, applicants from China are the largest EB-5 holders, accounting for 85 percent of the 10,000 EB-5 visas issued in fiscal year 2014. Congress is currently considering legislation to extend the EB-5 program, but that would create more hurdles for project developers and investors, such as raising the minimum investment from $500,000 to $800,000.
Robert van Eerde, managing director of STEM Hotels, which manages Hotel Astor, estimates the renovation will take nine months to complete. “The majority will be ready for season in 2016,” Van Eerde told TRD. “Our goal is to reposition Hotel Astor into what it used to be: a high-end boutique hotel.”