New York [Hearts] EB-5 Visas

It turns out the EB-5 visa has won fans beyond Atlantic Yards, where Bruce Ratner has been trying to use

Visas, ahoy! (Tishman Construction)

It turns out the EB-5 visa has won fans beyond Atlantic Yards, where Bruce Ratner has been trying to use the program to gin up funds for his prefabulous apartment towers.

Over the past four years, developers in the New York area have raised upwards of $1 billion through the visas-for-cash program, according to an investigation in The Times. During that period, EB-5 applications across the country have nearly quadrupled, to 3,800, as the Obama administration has been promoting the program strongly.

Still, some critics of the program have described it as an improper use of the immigration system to spur economic development—a cash-for-visas scheme. And an examination of the program by The New York Times suggests that in New York, developers and state officials are stretching the rules to qualify projects for this foreign financing.

These developers are often relying on gerrymandering techniques to create development zones that are supposedly in areas of high unemployment—and thus eligible for special concessions — but actually are in prosperous ones, according to federal and state records.

Among the projects seeking funds through clever boundaries is Extell’s International Gem Tower and the Battery Maritime Building at the tip of Manhattan. The latter uses a zone that “snakes up through the Lower East Side, skirting the wealthy enclaves of Battery Park City and TriBeCa, and then jumps across the East River to annex the Farragut Houses project in Vinegar Hill, Brooklyn.” Here’s a handy map of the gerrymandering.

The Farragut Houses, which like many city housing projects suffers from especially high unemployment, is actually included in three different EB-5 zones, including Atlantic Yards. Whether anyone in the houses is actually benefiting from the jobs is unknown. Whatever the ethics of the program, it should at the very least be helping them.

mchaban [at] | @MC_NYC New York [Hearts] EB-5 Visas