Two New York developers are seeking to raise EB-5 money for the construction of the first Edition Hotel on the West Coast, The Real Deal has learned.
Howard Lorber and Steve Witkoff are trying to raise $75 million in mezzanine financing through the program, which grants foreign investors green cards in exchange for a minimum investment of $500,000 in job-creating projects in the U.S.
The program is one of the most popular — and most controversial — fundraising vehicles for developers in New York, L.A. and Miami. Other L.A. developers leveraging the program include MacFarlane Partners, which is seeking to raise $60 million for the construction of two residential buildings across from Pershing Square in DTLA., and hotelier Beny Alagem’s Oasis West Realty is looking to raise $150 million for the Waldorf Astoria.
Lorber’s New Valley and the Witkoff Group previously scored a $260 million loan for the construction of the West Hollywood hotel from Cornerstone Real Estate Advisors. They’re developing the hotel and condo property in partnership with Marriott and hotelier Ian Schrager.
It’s slated to have 190 hotel rooms, 20 condominium units, a restaurant, bar, two rooftop pools and nightlife venues.
The same partnership raised $200 million in financing through the EB-5 program for another Edition Hotel in Times Square. USIF, one of the country’s most active regional EB-5 centers, is marketing the projects to investors primarily from China. The total project cost is in excess of $300 million.
Lorber and Witkoff broke ground on the L.A. project earlier this year. Neither developer was immediately available for comment.
The EB-5 program was extended by Congress last year until the end of September, when representatives will once again discuss possible changes to the program.