EB-5 and Hospitality Financing: Urban EB-5 Is Still a Large-Scale Game

By David A. Sudeck —

This post is the third in a series presenting my current thoughts on the viability and timeliness of EB-5 financing for new hospitality construction. Each installment is published as a standalone piece and can be read independently of the others in the series.

• EB-5 and Hospitality Financing: A Structural Shift in Capital Markets
• EB-5 and Hospitality Financing: Rural TEAs—Still the Fast Lane
• EB-5 and Hospitality Financing: Urban EB-5 Is Still a Large-Scale Game (this post)
• EB-5 and Hospitality Financing: Leverage and Structure Matter More Than Price
• EB-5 and Hospitality Financing: Why EB-5 No Longer Slows Deals
• EB-5 and Hospitality Financing: How EB-5 Improves Equity Returns
• EB-5 and Hospitality Financing: Practical Steps for Developers
• EB-5 and Hospitality Financing: Why Now Is a Good Time

Outside rural Targeted Employment Area (“TEA”) projects, EB-5 capital is significantly more selective. Lender appetite for non-rural deals is generally concentrated on transactions exceeding $50 million, typically for high-profile developments in well-known locations. The reason is straightforward: EB-5 investors and the funds raising capital on their behalf need a compelling, globally marketable story. Projects anchored by recognizable brands in major markets meet that standard, whereas a $25 million select-service hotel in a secondary city generally does not.

As a result, a clear difference has emerged in this arena: rural TEA projects remain accessible to middle-market developers across a broad range of deal sizes, while non-rural EB-5 financing is effectively limited to larger, institutional-quality developments. This distinction matters for how developers should think about EB-5 at the outset of a deal. In rural and tertiary markets, EB-5 can serve developers across a wide spectrum of project sizes, but in major urban markets, the calculus shifts sharply toward scale, brand, and a story that resonates with an international investor base. Developers evaluating a smaller or mid-market urban hospitality project should recognize this reality early, since it shapes not only whether EB-5 is a viable financing source but also how the capital stack and project positioning must be structured to attract lender and investor interest.

Feel free to reach out with any questions or thoughts on this topic, and please meet with us at the upcoming 2027 EB-5 & Global Immigration Expo in Newport Beach, California, January 20-22, 2027. Click here to register.

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David is a partner and co-chair of Blank Rome’s Hospitality practice, where he focuses on the hospitality industry, with particular emphasis on the financing structures that support hotel development and acquisition. His practice draws on extensive experience guiding developers, lenders, and investors through complex capital stacks in the hospitality sector. Learn more about his practice here.