Feels like a normal construction loan arrangement on a residential project.....Contractor sends invoice to bank, bank approves the release of funds and people get paid.
I wonder if there is some validation step....
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Big Burke announcement
- Thread starter the original trailboss
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Feels like a normal construction loan arrangement on a residential project.....Contractor sends invoice to bank, bank approves the release of funds and people get paid.
I wonder if there is some validation step....
dlague
Active member
Next paragraphs are equally as interesting
The developers will not have control of the distribution of funds; instead, the money will be released by a third party construction project consultant that has been hired by the Department of Financial Regulation.
“I believe DFR has created a workable solution that would provide investor protection while allowing the project to continue,” Donegan wrote in a memo to the developers.
VTKilarney
Well-known member
One has to wonder if anything has happened in the past that has prompted the state implement these safeguards.
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Masskier
New member
You would of thought that these safe guards would have been in place since the beginning of the EB 5 program. As River said above this is very common in residential and (also commercial) development. Whether you are using the Bank's money or private investors, this inures that the funds are being spent on the actual construction and related expenses.
You would have thought that, but we've had amateur hour from the State for the first few years. Pretty sad.
BenedictGomez
Well-known member
I don't think one has to wonder.
The good news is that despite the sideshow things are progressing...for the hotel at least.
VTKilarney
Well-known member
Agreed. Given the challenges involved (SEC investigation, fundraising hold, etc.), it's pretty impressive that there is an opening date scheduled for December 11th.
VTKilarney
Well-known member
Apparently the new manager has not received all of the EB-5 talking points. He told the Caledonian Record that there are only 131 workers on site. Things are in full swing right now and I recall that we were promised many more workers.
BenedictGomez
Well-known member
Doesn't matter so long as the paperwork turned in to the government say eleventy-billion workers.
Hundreds they said........hundred + s = multiple hundred workers......not 131, but whatever....the friggin' thing seems to be getting built....which is good......
Honestly it seems like the long and short of it is, at the very least we can say Bill and Q kept shitty records of what they did with the money....evidenced by installing a proper process to manage the funds........provide invoice and proof of work completion and people will get paid.
Of course I still think their operation stinks to high heaven of Pozi scheme type management of funds and corporate structures etc.
VTKilarney
Well-known member
IMHO, the "business" of EB-5 is not creating business. It is getting a cut of the initial investment.
I recall reading that Stenger and Quiros get a 10% management fee of all of the EB-5 funds that they bring in. About $280 million has been raised for projects at Jay Peak. That's a management fee of $28 million. The incentive is to get investment money and rake in the management fee - whether or not the business being built with the money is viable.
Can Burke sustain a profitable hotel and aquatic center? I don't think that I would care if I got $10 million in management fees to find out if other people's money was wisely spent.
I recall reading that Stenger and Quiros get a 10% management fee of all of the EB-5 funds that they bring in. About $280 million has been raised for projects at Jay Peak. That's a management fee of $28 million. The incentive is to get investment money and rake in the management fee - whether or not the business being built with the money is viable.
Can Burke sustain a profitable hotel and aquatic center? I don't think that I would care if I got $10 million in management fees to find out if other people's money was wisely spent.
the original trailboss
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In the Saturday edition of the Caledonian Record: "With many longtime employees now gone, marketing manager Jessica Sechler says the ski area won't lose its hometown appeal as expansion brings more out-of-state vacationers." You just can't make this stuff up !
mbedle
Well-known member
Are you sure about that? I am pretty sure that the only management fee associated with EB-5 is collected by the regional center and not the company owners.
LONGBOARDR
Active member
I believe the topic in question refers to a 10K document fee.
So during the process, if the prospective investor pulls out during the review period, the do not get the 10K back.
That was the way it was explained to me.
VTKilarney
Well-known member
Here is what I was referring to:
http://www.shenlaw.net/cn/eb5_info14.pdf
In particular, this statement:
The required minimum amount of investment funds to the Project per Investor is
US$500,000 (the “Investment”), plus an additional US$50,000 in administrative fees (the
“Administrative Fees”) payable to Jay Peak, Inc. (the “Company”).
It looks like some of this fee may go to the people who bring investors in.
But all of this is just speculation on my part.
http://www.shenlaw.net/cn/eb5_info14.pdf
In particular, this statement:
The required minimum amount of investment funds to the Project per Investor is
US$500,000 (the “Investment”), plus an additional US$50,000 in administrative fees (the
“Administrative Fees”) payable to Jay Peak, Inc. (the “Company”).
It looks like some of this fee may go to the people who bring investors in.
But all of this is just speculation on my part.
LONGBOARDR
Active member
Yes, I believe that is yet another fee which is like a referral or finders fee.
Not bad eh?
VTKilarney
Well-known member
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