EB-5 loan packager Mastroianni has stepped back. (Would that help Related JV avoid "Prohibited Person" status?) USIF still (misleadingly) hypes Atlantic Yards

I'm still wondering about an issue raised last year at the Atlantic Yards Community Development Corporation regarding the U.S. Immigration Fund (USIF), the "regional center" (or loan packager) that recruited immigrant investors under the EB-5 investor visa program.

The USIF is one participant in the joint venture expected to take over development rights for six towers over the Vanderbilt Yard. 

A USIF affiliate, thanks to advantageous contract language, manages and controls the investment fund that was not repaid by developer Greenland USA, leading to the oft-postponed foreclosure process, win another auction supposedly scheduled for Jan. 27.

Chinese investors, who each invested $500,000 (plus fees) for a purportedly job-creating project, actually put up the money but have little sway.

From USIF 2022 video

The question: does USIF founder and Chairman Nicholas Mastroianni II, whose criminal record includes an arrest on felony drug charges, prohibit the joint venture from qualifying as “permitted developer”? Felons are barred as "prohibited persons." (It’s unclear whether he pleaded “no contest” to a reduced charge.)

"We're still looking at it,” said lawyer Matthew Acocella of Empire State Development (ESD), the state authority that oversees/shepherds the project, at a meeting last November. “But based on the information we've gotten and based on the structure of the [joint venture], we don't see any bar to proceeding with this joint venture as the permitted developer with Related [Companies] and USIF.”

I wrote at the time: Does that mean that Mastroianni is not a felon? Or if he is, it doesn’t count? Could it be that that only the company that builds the project, not any financial partners, gets evaluated as a permitted developer? (That seems off.)

Another possibility

Or, I speculate, could it be that Mastroianni's formal role has changed, and that gives the joint venture an out? 

For example, he is not currently listed among the USIF's leadership, though he was listed as late as October 2023.

That said, the screenshot below does state that Nicholas A. Mastroianni III, the USIF President, "and his father, Nicholas Mastroianni II, work in partnership to facilitate new projects and opportunities in a global marketplace." 

That means Mastroianni II, even if he's no longer listed on the website as Chairman (see below), remains involved. It may simply be that he's passed the torch to his son, who, after all, is the most prominent company person in the video below.

A Wall Street Journal article last August about the pending joint venture quoted "Nick Mastroianni, the U.S. Immigration Fund’s president," without a Roman numeral. Given the title, it was likely the son.

October 2023

The screenshot below from the Oct. 5, 2023 version of the website, lists Nicholas Mastroianni II as the company Chairman.



Regarding Mastroianni II, the text states:

Mr. Mastroianni is the Founder and Chairman of U.S. Immigration Fund, LLC and its affiliated companies (USIF), including multiple EB‐5 approved regional centers in New York, New Jersey and Florida (and California pending)...

Mr. Mastroianni is also the President of Allied Capital and Development of South Florida, LLC, a South Florida-based real estate development company, founded in 2004.

A 2022 video

If you consult the USIF's Education and Videos page, the first video is titled "USIF -- Who We Are," and dated 2022, referencing Mastroianni II--as per the screenshot up top--as the company Chairman & CEO.

The gauzy promotional video has a couple of Atlantic Yards references, which are both misleading and a bit curdled, especially given the foreclosure.

At about 2 minutes in, we see Forest City Ratner CEO Bruce Ratner shaking hands with visitors, then a shot of the Forest City Ratner Companies logo on the exterior of the firm's Brooklyn office.

The narrator states: "These companies have been responsible for masterminding some of the companies' most revered districts. Some of the most recognizable buildings in the entire world."

Of course, Forest City is today irrelevant, as the company not only exited Atlantic Yards/Pacific Park, its parent, Forest City Realty Trust, was absorbed in 2018 by Brookfield.

After the above-mentioned narration, the video shows a series of buildings, including the Barclays Center. 

However, EB-5 funds didn't help build the Barclays Center, as I wrote last February.

Moreover, the only EB-5 funds received before the arena's construction were raised via a different middleman, the New York City Regional Center, and the immigrant investors in that case were repaid, albeit late, as of January 2020.

Another reference

At about 7:06 of the video, we see people walking west down Dean Street between Vanderbilt and Carlton avenues. 

Then we see an image of the 550 Vanderbilt condo tower, aka B11.

However, while USIF claimed that 550 Vanderbilt was funded by EB-5 monies and thus contributed to job creation, New York State barred use of such funds for that site.

A Trump connection

One more thing: among the parade of developers cheering on the USIF is Steve Witkoff, President Donald Trump's special envoy to the Middle East.

It seems likely that EB-5 industry players like the USIF, thanks to such a connection, will be treated well by the new administration.