Transcript Slide 1

Presentation to
WHARTON CLUB OF SOUTH FLORIDA
September 12, 2012
AAOF091212
EB-5 Immigrant Investor VISA Program
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The EB-5 Immigrant Investor Visa provides permanent U.S. residency to
foreign nationals and their immediate families through investment in U.S. based
businesses or real estate opportunities that result in the creation of new jobs
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Created in 1990 by U.S. Immigration & Naturalization Services (now called
U.S. Citizenship and Immigration Services (USCIS))
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Applies to foreign investor, spouse and minor children under the age of 21
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Limited to 10,000 visas per year
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Required equity investment of $1,000,000 reduced to $500,000 if the
investment is made in a Targeted Employment Area (TEA)
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Investment must be “at risk” – no guarantee for return of capital
Investment must create 10 jobs for legal U.S. residents
U.S. Citizenship
and Immigration
Services
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EB-5 Immigrant Investor Visa Program
Advantages of the EB-5 Visa
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Unlike other visas, the EB-5 is not restrictive:
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Live and work anywhere in the U.S.
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No travel restrictions
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No language skills required
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No age restrictions
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No business or special training experience required
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Ability to start a business, go to school, retire
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Option to become a permanent U.S. citizen after five years
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Ability to sponsor Green Cards for relatives
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EB-5 Immigrant Investor Visa Program
EB-5 is Becoming More Popular
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Families are choosing the EB-5 visa for various reasons:
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Retirement (lower cost of living and better quality of life)
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Children’s education (U.S. resident tuition rates and the ability for children
to maintain permanent residency after age 21)
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Family already in U.S. but on another, expiring visa
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Political and/or social unrest in home country
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Caps and time delays on other visa options are driving foreigners to EB-5
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U.S. Dollar has weakened, making EB-5 a “less expensive” option
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EB-5 Immigrant Investor Visa Program
Regional Center Program
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Regional Center Program passed Congress in 2003
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Created “Regional Centers” that vet applicants and investments
Several Advantages of using a Regional Center:
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Allows for passive investment – foreigner does not have to actively
manage the business
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Allows for calculation of job creation through Econometric Model
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Counts direct, indirect, and induced jobs
Provides more assurance that the applicant’s investment will be spent in
accordance with U.S. Immigration Act’s requirements and objectives
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Business plan for the Regional Center’s investment option is reviewed
and approved by USCIS prior to any EB-5 applicant’s investment
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EB-5 Immigrant Investor Visa Program
How Does it Work?
Foreign investor
decides on a
Regional Center or
Independent Project
• Foreign Investor submits
application (form I-526) and
makes investment
• Approval in 20 to 24 weeks
Foreign investor
receives “temporary”
Green Card
• Provides all benefits of
permanent Green Card, except
expiration
After 21 months, foreign
investor may file to have
“temporary” condition
removed (form I-829)
• Proof of job creation is
examined
Foreign investor and
family receives
permanent Green
Card
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Florida Equity and Growth Fund Regional Center
Florida Focus – Targeted Employment Areas
Targeted Employment Areas (TEAs) are defined by the Immigration Act of 1990 as
“rural areas,” or areas not located within a Metropolitan Statistical Area (MSA) or
within a city or town with a population of 20,000 or more.
AAOF’s Approved TEAs
Alachua
Brevard
Citrus (rural)
DeSoto (rural)
Flagler (rural)
Hardee (rural)
Hernando (rural)
Highlands (rural)
Hillsborough
Lake
Levy (rural)
Manatee
Marion
Orange
Osceola
Pasco
Polk
Pinellas
Putnam (rural)
Sarasota
Seminole
Sumter (rural)
Volusia
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Florida Equity and Growth Fund Regional Center
Florida Focus – High Unemployment Areas
High Unemployment Areas (based on individual census tracts) also count as TEAs
and are defined as non-rural areas with unemployment rates at least 150.0% of the
national average for the latest calendar year. For calendar year 2011, the national
unemployment rate averaged 8.9%. Therefore, a census tract qualifies if its 2011
annual average unemployment rate was at least 13.4%.
Hillsborough
County, for example,
has 80 census tracts
that are eligible for
investment.
The combined areas
qualifying for
investment are
highlighted in green
on the adjacent map.
Hillsborough County
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Atlantic American Opportunities Fund (AAOF)
U.S. Citizenship
and Immigration
Services
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Diversified Investment Portfolio approach to EB-5
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USD $500,000 investment per family
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Focused on excess job creation (goal of 15 to 20 jobs per investor)
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EB-5 applicants become passive investors in not just one, but many jobcreating investments
Formed as a Limited Partnership
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Investor owns pro-rata share of entire fund (investor’s profits are based on
those of all individual projects, not just one)
Managed by Atlantic American Partners from Tampa, Florida
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Atlantic American Opportunities Fund (AAOF)
Diversified Portfolio Approach to EB-5
Traditional Regional Center
Investment Structure
AAOF Diversified Portfolio
Investment Structure
EB-5 Applicant / Investor
EB-5 Applicant / Investor
Regional Center /
Developer
AAOF
Developer’s
“Pet” Project
GroceryAnchored
Retail
Medical
Office
Assisted
Living
Hotel
Other
Investments
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Advantages of AAOF
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AAOF provides a unique approach to the EB-5 Investor Visa Program,
providing significant advantages over other Regional Center investments,
including:
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Less Risk of Meeting Job Creation Requirements
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Less Risk of Loss of Investment
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Structured Exits Provide Timely Return of Foreign Investor’s Capital
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We’re Creating Value for Investors: Not the Other Way Around
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Professional Investment Managers
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Avoids Conflict of Interest Found in Other Regional Centers
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Synergies Achieved Through Sister Funds
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Transparency of Investments
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Advantages of AAOF
Less Risk of Meeting Job Creation Requirement
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The only way to secure a permanent U.S. visa through the EB-5 Program is
through Job Creation – our top priority
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AAOF will only invest in opportunities that create an abundance of jobs
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Targeting 15 to 20 per investor (in excess of the required amount of 10) with
a preference for investments that create more
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Investing alongside outside capital to participate in larger projects that
create even more jobs per investor
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Sister private equity funds that invest in similar projects
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Banks / other lenders and outside investors
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Government Sponsored Incentives (New Market Tax Credits, Low
Income Tax Credits, HUD Financing)
USCIS approved Jobs Bank provides “Belt and Suspenders” security
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Excess jobs are stored in the Jobs Bank
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In the unlikely event that an applicant has a shortfall (business failed,
property burned down, etc.), excess jobs may be allocated to the applicant
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Advantages of AAOF
Less Risk of Meeting Job Creation Requirement
Atlantic American Opportunities Fund II
4 investors
$2mm
11 investors
$5.5mm
40 jobs
24 investors
$7mm
$4.5mm
110 jobs
15 investors
240 jobs
18 investors
$4mm
150 jobs
15 investors
$1.5mm
180 jobs
13 investors
$6.5mm
150 jobs
130 jobs
Tampa
Festival
Osprey
Lodge
Le
Meridien
Hotel
MOB at
Meres
Mills
Crossing /
Fresh Mkt.
Orlando
Marriott
Res. Inn
ALF at
Meres
65 total jobs
172 total jobs
320 total jobs
340 total jobs
240 total jobs
220 total jobs
180 total jobs
25 jobs
62 jobs
80 jobs
190 jobs
60 jobs
70 jobs
50 jobs
Jobs Bank
537 Unallocated Excess Jobs
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Advantages of AAOF
Less Risk of Loss of Investment
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AAOF’s #2 priority is to Preserve our Investor’s Capital
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Diversification is a risk management philosophy of making many
investments as opposed to a single investment to reduce risk
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Less risk of losing capital
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Provides for more predictable profits
AAOF plans to make 5 – 7 different investments instead of just one
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Various industries (healthcare, grocery-anchored retail, hotel, business
services, manufacturing, distribution)
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Various geographies (throughout Florida)
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Various investment types (loans secured by collateral and equity)
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Advantages of AAOF
Structured Exits Provide Timely Return of Foreign Investor’s Capital
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AAOF is structured differently than other EB-5 investments
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Each individual project will be owned by AAOF, a limited partnership
owned in majority by the investors, not the Regional Center or a Developer
AAOF will return investor’s capital in a timely and structured manner
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AAOF will begin returning capital after the required 5 year “at risk” period
expires
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Interim profits will be distributed each calendar quarter
Structured Investment Exits
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Secured Loan investments will have a defined maturity date, requiring loans
to be repaid in 5 years
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AAOF will only make equity investments in projects where we (and
essentially the investors) have a controlling interest in the project, enabling a
sale of the property at a time determined by AAOF
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Advantages of AAOF
We’re Creating Value for Investors / Not the Other Way Around
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Unique profit sharing approach puts the Investor ahead of the General
Partner, compared to other Regional Centers:
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2.5% annual investment management fee (paid out of profits) to support
investment, due diligence and transaction closing expenses
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The next 5.0% is paid to the investors (on an annual basis, paid quarterly)
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The next 5.0% is paid to the General Partner (on an annual basis, paid
quarterly)
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Thereafter, the investors and General Partner will split the profits 50 / 50
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Investment Criteria
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Investment Size
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Location
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$5,000,000 — $15,000,000
Florida’s High Tech Corridor (23 Counties along I-4)
Investment Type
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Preferred Equity
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Common Equity
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Subordinated Debt
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Senior Debt
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Investment Criteria
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Investment Criteria
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Florida-Based Businesses or Construction / Development Projects
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Redevelopment of Commercial Real Estate
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Opportunities that Create Sustainable Jobs
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Strong Preference for non-speculative real estate
Industries
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Assisted Living / Skilled Nursing Facilities
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Hotels and Restaurants
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Medical Office Buildings
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Commercial Retail (preference strong regional or national anchor)
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Manufacturing
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Professional, Scientific and Technical Services
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Example Portfolio Investment
Osprey Lodge at Lakeview Crest
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124-bed Assisted Living Facility in Tavares (Northwest of Orlando)
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Project Considerations:
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Adjacent to Florida Hospital (Waterman) medical campus
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Significant demand for beds in the geography
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Experienced developer and operator
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Strong sponsorship (developer and city)
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Inherent bridge facility
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Example Portfolio Investment
Osprey Lodge at Lakeview Crest
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AAOF II is making a $5.5 million investment (11 EB-5 investors)
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$5.0 million senior secured bonds
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$500,000 equity stake
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AAOF II projects 10.5% IRR over 5 years
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Econometric model projects 172 new jobs (56% cushion)
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Example Portfolio Investment
Le Meridien Hotel
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135-room Le Meridien (Starwood) hotel in downtown Tampa
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Involves the redevelopment of vacant Federal Courthouse (built 1905)
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Project Considerations:
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Significant need for high-end hotel rooms in downtown Tampa
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Experienced development and operations team
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Structured exist strategy
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City is providing low rent and reduced taxes
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Historical Tax Credits of $4.24 million
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Starwood “key” investment of $1.0 million
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Example Portfolio Investment
Le Meridien Hotel
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AAOF II is making a $12.0 million investment (24 EB-5 investors)
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$5.5 million Member Loan
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$6.5 million Preferred Equity stake
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AAOF II projects a 13% IRR over 5 years
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Econometric model projects 320 new jobs (33% cushion)
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Investment Management Team
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AAOF was created and is managed by two successful, sister investment firms
with extensive fund management experience:
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Communications Equity Associates (CEA)
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Atlantic American Partners
While AAOF is a new EB-5 investment option, its investment managers have
been making similar investments for over 35 years
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Investment team has over 100 years of combined investment management
experience
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Have invested over $1.5 billion in 12 series of investment funds
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Investment Management Team
J. Patrick “Rick” Michaels
Managing Partner
43 years experience
J. Patrick “Rick” Michaels, Jr. is the founder and Chief Executive Officer of Communications Equity Associates
(CEA), a firm he established in 1973 to provide financial services and advice to a select group of clients in the
cable industry. Over the past 34 years CEA has become a leading provider of investment banking services and
private equity for the global media and entertainment, communications and information technology industries.
CEA has completed over 900 transactions in 60 countries, totaling in excess of $40 billion, all of which have
been handled directly or overseen by Mr. Michaels.
Robert Moreyra
Managing Partner
29 years experience
Robert Moreyra is a founder of Atlantic American Partners and currently oversees the firm’s investment
banking practice and private equity initiatives, including Community Reinvestment Partners II. Prior to
founding Atlantic American, Mr. Moreyra served as Managing Director of investment banking with H. C.
Wainwright & Co., Inc. At Wainwright, Mr. Moreyra focused on public offerings, private placements, debt
placements and restructurings, and mergers and acquisitions. Mr. Moreyra also serves as a Managing
Principal of the Atlantic American Opportunities Funds, and previously served as CEO of Pardue, Heid,
Church, Smith & Waller, Inc.
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Investment Management Team
O. Garwood “Gar” Lippincott
Managing Partner
28 years experience
Gar Lippincott joined Atlantic American Partners in 2005 and currently serves as a Managing Principal of
Atlantic American Opportunities Fund (AAOF). Prior to joining Atlantic American, Mr. Lippincott served as
President of Dominion Capital Group, a small Tampa-based merchant bank providing senior and subordinated
loans, and equity capital to small businesses in the Southeast U.S. Mr. Lippincott has worked in investment
capacities at Banque Paribas and Met Life, as well as serving as CEO of Central Electric Company.
Bradley J. Snyder
Partner
16 years experience
Bradley Snyder joined Atlantic American Partner’s investment banking group in September 2004, focusing on
investment banking and private equity. Mr. Snyder has extensive experience in completing merger and
acquisition transactions, as well as securing debt and equity in both the public and private markets.
Leveraging this experience, Mr. Snyder currently focuses on identifying, analyzing, negotiating, and managing
corporate and real estate investment opportunities for Atlantic American Opportunities Fund (AAOF). Prior to
joining Atlantic American, Mr. Snyder gained extensive advisory and corporate finance experience with Gulf
Atlantic Capital Corporation, a turnaround and workout group located in Tampa, Florida and at Tunstall
Consulting, Inc.
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Investment Management Team
Ming Jung
Chief Financial Officer
17 years experience
Ming Jung serves as Atlantic American Opportunities Fund’s Chief Financial Officer, overseeing all of the
fund’s financial reporting and tax matters. Mr. Jung has been with CEA since March 1997 and is the Sr.
Managing Director and Chief Financial Officer of CEA Capital Advisors, LLC, the development and
administration arm of CEA Private Equity Partners. Prior to joining CEA, Mr. Jung spent four years with the
international accounting firm of Arthur Andersen LLP, most recently as a senior tax specialist. He is a
Certified Public Accountant and a member of the American and Florida Institute of Certified Public
Accountants.
Brad Gordon
Managing Director
26 years experience
Brad Gordon currently serves as Executive Vice President and Chief Financial Officer of Communications
Equity Associates (CEA), where he has held several senior management positions during his 25-plus-year
career at CEA. In 2000, Mr. Gordon, along with Rick Michaels and Robert Moreyra, founded Atlantic
American Partners. Mr. Gordon brings extensive investment banking management experience and a broad
base of industry knowledge to the Firm. In his capacity as Chief Financial Officer at CEA and Atlantic
American , Mr. Gordon has been instrumental in developing and supervising the firms’ finance, tax
compliance, economic forecasting and security compliance. He is actively involved with the development
and management of both firms’ internal investment activities.
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Contacts & Additional Information
Gar Lippincott
Managing Partner
(813) 226-6128
[email protected]
Robert Moreyra
Managing Partner
(813) 574-6774
[email protected]
Brad Snyder
Partner
(813) 226-6141
[email protected]
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