economic problems in the two countries, and a resultant
increase in crime rates, says Rogelio Caceres, co-founder
of LCR Capital Partners, which sources 47 percent of its
EB-5 investments from Latin America. “The biggest driver
has been the unfortunate macroeconomic and security
concerns these two countries have faced,” Caceres says.
Brazil’s former president, Dilma Rousseff, was ousted
in May 2016 for allegedly manipulating government
accounts, and the country has since been hit by a second
presidential corruption scandal, an economic downturn
and soaring crime rates. Venezuela, meanwhile, has
endured hyperinflation, a dramatic increase in violent
crime and ongoing clashes between protesters and
government security forces. Mexico, previously one of
Latin America’s most important EB-5 players, accounted
for only 57 visas in fiscal 2016, the country’s lowest tally
since 2011.
That’s a trend that could continue, Caceres says,
with some Mexicans thinking twice about relocating
to the U.S. in the wake of the 2016 election. “There’s
been a Trump effect,” Caceres says. “There’s a strong
sense of national pride and populism that’s affected
business and immigration. We’ve seen a downturn in
that country.”
Other Latin American countries have historically
contributed relatively few EB-5 investors, although
last year both Argentina, with 36 approved visas, and
Colombia, with 35 visas, contributed significantly
more EB-5 investors than in previous years.
13
EB5 INVESTORS M AGAZINE
SEEKING ALTERNATIVE
MARKETS TO CHINA
The surge in Latin American EB-5 activity is partly due to
a shift in focus from EB-5 brokers and agents, who are
seeking alternatives to the crowded Chinese marketplace,
says Dennis Slater, principal of the Florida EB-5 Regional
Center, which now sources more than a third of its capital
from Latin America.
“When China put the brakes on, they had to go somewhere,
and Brazil and Venezuela were the most likely areas,”
Slater says. “There’s a heavy concentration of marketing
effort in Latin America right now.” So far, much of the
outreach has focused on building awareness of EB-5
programs, which weren’t well-known in Latin America until
recently, says Caceres. “Awareness is key,” he says. “You
can’t grow a market without awareness, and there’s no
existing agent network in these countries.”
Agents and brokers have had to develop relationships not
just with investors, but also with lawyers, tax specialists,
and wealth-management consultants in the region. “It’s
a lot of hard work, but it’s paid off quite substantially,”
Caceres adds. It’s true that relationship-building is critical
for EB-5 professionals looking to Latin American markets,
says Rodrigo Azpúrua, the Venezuelan-born CEO of Riviera
Point Development Group, a south Florida EB-5 developer.
“South America is about people,” Azpúrua says. “Building
that relationship and word-of-mouth is the key to growing