Due Diligence Report: Anasu

Thank you for showing interest in the following due diligence report. This report offers a detailed overview of the project and investment, highlighting both its strengths and potential risks. If you have any questions or need further information, please contact our team.

Investment Overview

The GGG Anasu Resort project includes the development and operation of an ultra- luxury five-star hotel with 40-keys. The project is located on a 22,000 acre property in the heart of Napa Valley, California - one of the most prestigious wine regions in the world. The resort includes several boutique hotel lodges, a winery, permanent residences, golf courses, a safari tent lodge, a fishing lodge, equestrian and polo facilities, a museum, and an outdoor music auditorium among other amenities.

The Project (JCE)

The GGG Anasu Resort project is an incredibly high-end and unique project that includes the development and operation of a luxury, 40-key five-star hotel. The resort will be built on a 22,000 acre property located in Guenoc Valley, California.

The Location

The Guenoc Valley is easily accessible to all parts of the Bay Area. The property spans 16,000 acres in Lake County and over 7,000 acres in Napa County. It is located only 60 air miles north of San Francisco, on the border between Napa and Lake County, and in close proximity to Napa's celebrated amenities. Middletown, adjacent to the property, has a charming and authentic retail core with a number of coffee shops and restaurants, all of which will furnish additional amenities to future guests of the property.The project is situated at 21000 Butts Canyon Rd, Lake County, California, adjacent to Napa Valley in the heart of California wine country. The project location is a two-hour drive from San Francisco, Sacramento, and Oakland.

The Anasu Resort
Inspired by the simplicity and elegance of nature, the Anasu Resort is an exclusive generational luxury resort and master-planned community development in the heart of Napa Valley. Designed and operated by the owners of the prestigious Aman Resorts brand, the project will consist of up to 1,400 residences, 460 hospitality units, workforce housing, resort amenities, and accessory uses at full buildout.

The project is the first of four developmental phases of the Anasu Resort. The development will build on Langtry Farms’ foundation of existing amenities and infrastructure. Phase 1 of the project includes the construction of the following amenities:

Entry Barn and Farm Buildings: Entry statements to the property, directing guests to the hotel reception upon arrival. These buildings ensure high-level security at the location. Guests have the opportunity to view and feed some of the farm animals raised on the property and witness commercial farming activities, such as sheep shearing, honey making, goats milk, etc.
Anasu Farms Hotel: 40 hotel rooms managed by AZOTELS Hospitality Limited. Each room incldues a bedroom, living area, large dressing room, bathroom, outdoor garden, terrace with a plunge pool, and outdoor shower.
Anasu Farms Village Retail: The retail facilities include a farmers market, bocce ball area, grocery store, restaurant and wine room, amphitheater stage, adventure sports shop, butcher shop, flower shop, coffee shop and bakery, ice cream shop, fishmonger, and a brewery.
Two Resort Villa Models & Lots: The project includes the construction of two resort villa models, to give owners flexibility in their design choice when selecting a home. These models offer between 3500-5000 square feet of living space.
Two Estate Home Models & Lots: The project includes the construction of two estate villa models. These encompass about 8300 sqft of living space plus a 2000 sqft entry barn, 3620 sqft event barn, and 500 sqft wine cellar. They also have space for an exercise room, study, family room, office, and large terrace with a fire pit. The entry barn includes a small bedroom and bathroom. The event barn has areas for entertainment, and a bar on the main floor with two guest bedrooms and bathrooms.
Residence Club: Private facility for residence owners within the Anasu Resort and one of several amenities managed by Azotels. Multi-generational facility with two food and beverage outlets, a bowling alley, an 11,000 sqft spa, yoga and health club, adult and child friendly swimming pools, a boat house, a dock, and water sports amenities.
Site Landscaping and Infrastructure: Already underway for several years, the site includes a 40- acre nursery with 20,000 trees and rare plants.

Timeline

Construction of the project is expected to take approximately 39 months. Construction activities began in Q3 2023 with completion expected in Q3/Q4 2026. Three phases are planned: the administration and planning phase, the construction phase, and the operational phase.

The administrative and planning phase includes land acquisition and entitlements, design, civil engineering, acquisition of permits and licenses, and payment of applicable fees. The construction phase includes securing soil engineer and land surveyor, rough grading, soil excavation, vertical framing, rough electrical, rough pluming, exterior and interior finishes, HVAC units, etc. After completion of the construction phase, the project will be delivered to the owners and the operations phase will commence.

Targeted Employment Area

Under the EB-5 immigrant investor program, a foreign national can become eligible to obtain United States permanent resident status by investing either $1,050,000 or $800,000 in a new commercial enterprise in the United States. To participate in the immigrant investor program through investing the lower US $800,000 amount, the alien must invest their capital funds into a geographic area that qualifies as a Targeted Employment Area. The most common types of TEAs are high unemployment areas and rural areas.

The location of the project qualifies as a rural TEA, meaning that EB-5 investors qualify for the reduced minimum investment amount of $800,000 and priority processing of Form I-526. To qualify as a rural area, an area must have no more than 20,000 residents; not border a municipality with a population of 20,000 or more; and not be located within a metropolitan statistical area. Each year, 20% of EB-5 visas are set aside for rural TEA investors, which could lead to faster approval. Due to its rural status, investors in the project also qualify for priority processing and may experience processing times significantly faster than investors in non-rural projects.

Job Creation

EB-5 investors are required to create at least 10 full-time jobs for US workers as part of the requirements of the EB-5 program. The project aims to subscribe a maximum of 236 EB-5 investors. In order to provide the required job count to every EB-5 investor, the project needs to create 2360 jobs for US workers. According to an economic impact analysis for the project by Baker Tilly, created in September 2023, the project will generate significant positive economic benefits for the local, regional, and US economy. The project is estimated to create 3,821.6 permanent new jobs. This number was calculated by using the RIMS II econometric methodology. Each investor can be assigned approximately 16 jobs, surpassing the minimum requirement of 10 per investor and decreasing immigration risk for EB-5 investors.

As of May 2024, 283.3 jobs jobs have already been created according to a job report completed by Baker Tilly. All required jobs are expected to be created by the end of the conditional residency period for all EB-5 Investors. Job verification will be completed by “reasonable methodologies,” such as the RIMS II econometric methodology used in this report.

Legal Overview

The project has met all the legal requirements of an EB-5 offering, ensuring compliance with the relevant statutes and regulations. Notably, the project’s I-956F, Application for Approval of an Investment in a Commercial Enterprise, was approved by USCIS in June 2024. This crucial approval confirms that the project satisfies the stringent criteria set forth by the USCIS to qualify as an EB-5 offering. Furthermore, the project aligns with the requirements of the Reform and Integrity Act (RIA) of 2022, which mandates enhanced transparency and integrity measures for EB-5 projects. In addition to regulatory compliance, the project is on track to meet the job creation requirements stipulated by the EB-5 program, demonstrating a robust plan to generate the necessary employment opportunities forU.S. workers. This adherence to legal and job creation standards underscores the project's viability and commitment to fulfilling the objectives of the EB-5 program.

Market Opportunity

The Project will operate under NAICS* industry cluster 72111: Hotels and Motels in the US. This industry is defined by providers of short-term lodging in hotels, motels, and resorts. Hotel revenue growth is predicted to grow 3.6% to $407.1 billion through the end of 2028, with profit reaching a predicted 21.7%. Experts predict that international and domestic tourism will reach pre-pandemic levels by the end of 2028 as economic uncertainty decreases.

The growth of alternative accommodations, such as Airbnb and VRBO, is a threat to hotels and forces them to offer more competitive nightly rates. However, specialty hotels (extended-stay hotels, boutique hotels, spas, health retreats, and luoxury resorts) will experience higher growth as they offer unique features that differentiate them from competition. Accommodations with well-established brand names that are known internationally are expected to outperform independent hotels.

The Anasu Hotel is a luxury resort owned and operated by the well-established Aman Hotels. Based on these economic predictions, the Anasu Hotel should outperform independent hotels and attract an ultra-luxury, niche group of visitors. The hotel's strategic location, coupled with its unparalleled amenities, positions it favorably within the high-end market segment. Moreover, the rise in affluent travelers seeking exclusive and unique experiences bodes well for the Anasu Hotel. The trend towards personalized luxury travel experiences means that properties offering bespoke services, such as those provided by Anasu, will see increased demand. The Anasu Hotel’s focus on providing top-tier hospitality, wellness programs, and curated cultural experiences aligns perfectly with the evolving preferences of high-net-worth individuals.

*The North American Industry Classification System (NAICS) is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy.

Marketing Strategy

The Anasu Hotel has a strong marketing strategy for its unique target demographic. The marketing team plans to utilize its different amenities to attract niche populations: Aman Brand Advocates, Golf Enthusiasts, Polo Lifestyle Enthusiasts, Culinary Enthusiasts, and Resort Lifestyle seekers. The marketing strategy will highlight the private resort, equestrian facilities, wine and Napa affinity, and modern architecture. The marketing will primarily target Billionaire and Ultra High Net Worth audiences based in Tokyo, Moscow, New York City, and Hong Kong. While it will focus on the UHNW+ individuals, distribution will also include ancillary influencer audience targeting during the initial awareness campaign. Advertisements will target frequent international travelers, specifically private jet travelers, with a male skew.

Marketing to the Ultra High Net Worth requires an atypical strategy, as many of these consumers only trust peer recommendations. The marketing team plans to use digital marketing, social media marketing, direct email and mail marketing, as well as high-end magazine and newspaper. The Anasu Hotel will also sponsor numerous events and partner with luxury brands that attract Ultra High Net Worth individuals, such as: the Royal Ascot, the International Paris Air Show, the Kentucky Derby, US Open, Jaeger-LeCoultre, Cartier, PHA, Art Basel, and Wimbledon. The marketing team will place targeted marketing materials in the following digital marketing and key print vertical spaces: TheTradeDesk, NYT, WSJ, CondeNast Traveler, Politico, Bloomberg Terminal, Insta, LinkedIn, FaceBook, American Express, Robb Report, Dujour, Financial Times, Niche Media, Modern Luxury, League Magazine Network, Affluence Media Agency. The Anasu Hotel will also secure key marketing partnerships with private jet airlines, including FlightAware, Signature Flight Support, Elite Traveler. This approach will not only enhance brand visibility but also position the hotel as a leader in the luxury hospitality market. By maintaining a strong presence in both digital and traditional media, the Anasu Hotel aims to attract and retain the most discerning travelers from around the world.

The EB-5 Investment (NCE)

The NCE (new commercial enterprise) for the project is 3G Langtry Fund, LLC. The NCE is responsible for the EB-5 loan raise.

Capital Stack

The project is raising a total of $589 million for the construction the Anasu Resort. Funding for the project will be secured through a combination of developer equity, infrastructure bonds, and EB-5 financing. Of this total, $169.6 million is a Target EB-5 Senior Secured Loan and $331 million is developer equity. The developer equity is subordinate to the EB-5 loan, which means the EB-5 loan will take priority for repayment. The final $88 million is secured by infrastructure bonds. The project has up to $100 million in infrastructure bonds available to them based on an evaluation by Feldman Law Group LLP. Infrastructure Bonds are not a loan - rather they are a reimbursement from the US government for private organizations building infrastructure, such as roads. As most of this project consists of the construction of infrastructure to support later phases, 14.9% of the capital will come from infrastructure bonds.

Investment Duration

The loan has a maturity of two years, plus two 1-year extensions.

Administrative Fee

The minimum investment amount of $800,000 does not include the amount of up to $70,000 administrative fee payable by an investor for offering costs, migration agent fees, brokerage fees, and administrative expenses. This amount may increase or decrease at the sole discretion of the Manager. This fee is non-refundable.

Security & Collateral

The EB-5 loan is the first priority for repayment in this project. The investment is secured by a first deed of trust on the real property comprising the Anasu hotel and 75 residential lots.

The EB-5 Investment Process

The following graph provides an explanation of the investment process from the perspective of the NCE for you to gain a better understanding of the steps involved:

Investment Structure

The NCE is a California limited liability company, formed for the purpose of making one or more “qualifying investments” in compliance with the EB-5 Investor Program and USCIS requirements so that investors are in a position to obtain conditional or permanent United States resident status. The NCE will be managed by 3G Langtry Fund Management, LLC on behalf of the foreign Investors. The NCE will receive at-risk equity investment from EB-5 investors and issue the full amount of equity investment into the Project by means of a loan to the JCE in the amount of at least $169,600,000.

Use of Funds

The project is anticipated to cost a total of $589,284,062. Hard Costs include all costs associated with the construction of the project including horizontal and vertical development, with an estimated budget of $358,309,909. Land Costs represent the cost of acquiring the land that will be used for the development of the project, with an estimated budget of $122,430,000. Furniture Fixes and Equipment costs include all expenses related to equipment needed to complete the construction, with an estimated budget of $9,446,500. Architectural and Engineering Costs costs include professional fees for engineers, architects, and consultants, with an estimated budget of $27,626,488. Soft Costs and Contingency include legal fees, other pre and post construction expenses, and fees for designers and additional consultants, with an estimated budget of $61,255,296.

Exit Strategy

The JCE’s strategy to repay the EB-5 senior secured loan, thereby allowing the NCE to return the investors’ capital, is to:

i) obtain a permanent senior secured loan supported by the $14 million of stabilized NOI in Year 3

ii) generate over $491 million of anticipated income from the sale of the 164 finished lot

Following repayment of the loan, the NCE may need to redeploy EB-5 funds to subsequent phases within the Anasu Resort to maintain the USCIS “at risk” requirement for EB-5 investments. To the extent that there are no viable opportunities to redeploy funds within the Anasu Resort, the NCE may redeploy EB-5 funds to similar real estate projects in the US. Such redployments will be conducted in compliance with the EB-5 policies then in effect.

Financial Projections & Assumptions

The project will generate income from the sale of finished lots and ongoing business operations. There will be a total of 164 finished lots offered for sale: resort lots, wine lots, and villa lots. The table below shows the total projected income from the sale of these lots.

In addition to income from the sale of finished lots, the project will also generate ongoing income from the hotel room revenue, sale of residential units, food and beverage sales, and more. Total revenue is projected to surpass $90 million by Year 3 of operations. The following tables provide the Developer’s calculations of hotel room sales and residential rental income as well as projections of profit and losses for the first five years of operations:

Management

Golden Gate Global

Golden Gate Global (GGG) was established in 2007 in San Francisco, California with an aim to assist international investors in attaining U.S. Permanent Residence under the EB-5 Visa Program. GGG is recognized as a leading operator of United States Citizenship and Immigration Services (USCIS) licensed EB-5 Regional Centers. Since its inception, Golden Gate Global has sponsored quality EB-5 projects that have withstood the scrutiny of USCIS, thereby proving its strong track record in the EB-5 industry. To date, over 1,400 EB-5 investors have trusted Golden Gate Global with their family’s immigration to the United States, representing EB-5 investment of more than $800 Million. EB-5 Projects managed by Golden Gate Global have successfully repaid close to $210 Million to 420+ EB-5 Investors in full and on time.

With GGG’s rigorous project selection criteria, the regional center only works with partners who boast unbeatable track records, experience, and creditworthiness. GGG then underwrites each project for job creation reliability and financial security and trains their investment focus on major metropolitan cities with strong, stable markets. GGG maintains stringent high standards for diligence, compliance and fund administration controls, and attracts institutional quality project partners. Accordingly, GGG offers EB-5 clients project investment opportunities with exceptional reliability and security and feature third-party fund administration and dual controls on all fund transfers.

GGG also offers alternative investments including debt-based investments, residential real estate, financial planning, and alternative investment projects. Click here to visit Golden Gate Global's website.

The Regional Center: 3G West Coast Regional Center

Formerly known as Halic Capital LLC, 3G West Coast Regional Center, LLC is a California LLC. The Regional Center is an affiliate of Golden Gate Global. The Regional Center received its designation from USCIS on March 4, 2015 for a geographic area that encompasses the entire state of California.

The New Commercial Enterprise (NCE): 3G Langtry Fund, LLC

3G Langtry Fund, the NCE, is a California LLC and was formed on January 2, 2023 for the purpose of providing EB-5 financing to the project. The NCE will receive up to $188,800,000 from as many as 236 EB-5 investors, each of whom are required to invest a minimum of $800,000. The NCE is an affiliate of Golden Gate Global.

NCE Manager: 3G Langtry Fund Management, LLC

The NCE will be managed by 3G Langtry Fund Management, LLC on behalf of the EB-5 investors. The NCE Manager is an affiliate of Golden Gate Global. The NCE Manager is run by Steven Kay, Founder and Co-CEO of Golden Gate Global, and Mark Jorgensen, Co-CEO of Golden Gate Global.

The Job Creating Entity (JCE): Bohn Valley Holdings 1, LLC

A California limited liability company formed on September 13, 2023, Bohn Valley Holdings 1, LLC is responsible for the project’s job creating. The JCE is owned by its sole member, Anasu Farm Investors, LLC, a Delaware limited liability company.

The Developer: Mahaman Development Group, LLC

Mahaman Development Group is a real estate development company founded in 2014 by Adrian Zecha, Jonathan Breene, Kevin Case, and Chris Meredith and a development partner with Lotusland Investment Holdings, Inc. Mr. Zecha is a renowned hotelier and founder of the luxury Aman Resorts. The Aman Resorts are famous amongst ultra-high net-worth individuals with luxury resorts in Greece, Vietnam, Morocco, Turkey, Italy, Japan, Indonesia, France, Montenegro, New York, Thailand, Montana, India, Sri Lanka, and more. Based in San Francisco, CA, Mahaman develops luxury properties in some of the world’s most desirable locations. The mission of Mahaman is to create exceptional, one-of-a-kind properties that cater to the needs of discerning buyers and offer unique lifestyle experiences. The company has been involved in several notable projects including the Residences at the Mandarin Oriental, Bodrum in Turkey, and the Residences at W Singapore Sentosa Cove. Click here to visit Mahaman's website.

The Hotel Brand & Operator: Azotels Hospitality Limited (HK)

Affiliated with Mahaman Development Group, Azotels embodies the profound work and influence of Mr. Adrian Zecha. Adrian Zecha is one of the world’s leading creators and operators of award-winning, luxury hotels and resorts. As the founder of world famous Aman Resorts, the Director and Non-Executive Chairman of GHM is renowned for developing distinctive properties that redefine the destinations in which they are set. In 1988, Zecha established Amanpuri, the first Aman Resort and in so doing, reinvented the luxury vacation experience.

Investment Manager: Lotusland Investment Holdings Inc

Lotusland Investment Holdings Inc. is a real estate investment company specializing in high-end resorts with comprehensive amenities like spas, fine dining, and wineries. They prioritize creating properties that offer luxury and memorable experiences. As the managing agent for Anasu Resort Holdings, Inc. and its subsidiaries, Lotusland Investment Holdings Inc. oversees equity investments in projects, emphasizing responsible development and minimal environmental impact.

The company values sustainability, local community support, and social responsibility, aiming to enhance the lives of residents and visitors. Founded in 2016, its first acquisition was 22,000 acres in the Guenco Valley, acquired with a small group of investors. Lotusland focuses on delivering exceptional, seamless, and sensory-rich projects, leveraging its hospitality expertise and strong partnerships. The CEO of Lotusland Investment Holdings is Alex Hu. Click here to visit Lotusland's website.

Biological Engineer: WRA, Inc.

Mike Josselyn and Jim Bucholz founded Wetlands Research Associates (WRA) in 1981 to use their academic research from San Francisco State University to provide regulatory permitting and restoration services for wetland environments. Their work supports Clean Water Act compliance. WRA has been involved in landmark court cases, authored technical papers and books, and participated in conferences and seminars. In the 1990s, WRA became an employee-owned S-Corporation. Today, WRA has four offices in California and operates in five western states. They partner with public agencies, non-profits, and private organizations to plan and implement sustainable environmental projects, focusing on fostering a sustainable future. Click here to visit WRA's website.

Civil Engineer: Sherwood Design Engineers

Sherwood Design Engineers is a civil engineering firm that applies innovation and elegant design to sustainable infrastructure. With 20+ years of experience in hundreds of projects located in the Bay Area and abroad, Sherwood Design Engineers is a recognized leader in integrated water resource engineering involving stormwater management, potable and non-potable water systems, storage and treatment, water quality, and more. They specialize in infrastructure, sites and buildings, ecological systems, water resource, land analysis, and mapping. Click here to visit Sherwood Design Engineers' Website.

Design Architect: Backen & Backen

Formed in 1996, Backen & Backen offers full architectural services, programming, farm design, and land planning. They utilize a regenerative lens that considers land, building, and body - allowing the firm to offer a holistic design service. They consider how the built environment can improve health and wellness in addition to reducing greenhouse gas emissions. They aim to design places in which lives and livelihoods can coexist within thriving, healthy, productive ecosystems. Click here to visit Backen & Backen's website.

General Engineer: OPAC

OPAC is a San Francisco based engineering firm founded in 1992. They have completed numerous projects successfully throughout the United States, Canada, Central America, South America, and various countries of the Pacific Rim. OPAC’s dynamic analysis experience includes studies of seismic vulnerability, fatigue effects, aerodynamic performance, and dynamic impact response to high-speed rail loads. Click here to visit OPAC's website.

Landscape Architect: Rider, Levett, and Bucknall

Based in San Francisco, CA, RLB is a leading independent firm providing cost consulting, construction, quantity surveying, and project management services on a broad variety of projects. Founded in 1991, the team is local to the Bay Area and comes with a unique background and in-depth understanding of the many variables that influence the decision making process on local projects. RLB has over 4000 staff and more than 120 global offices. Click here to visit Rider, Levett, and Bucknall's website.

Structural Engineer: PAE

Founded in 1967, PAE is a firm of more than 350 employees providing an array of services in mechanical and electrical engineering, building analysis, commissioning, and technology system design. With offices around the West Coast, PAE serves public and private sector clients throughout the Western United States and beyond. PAE sustainable practices bring lower operation costs to owners and tenants while using fewer natural resources. Click here to visit PAE's website.

Vertical Contractor: Alston Construction

Alston Construction offers general contracting, construction management, and design-build experience in industrial, commercial, hospitality, healthcare, education, retail, and government projects. Alston provides quality and cost-effective projects. In the last 5 years, Alston has completed more than $6.5 billion in project revenue encompassing more than 35 states. This includes thousands of completed projects with contracts ranging from $250,000 to $100 million. They have been named #31 out of the Top 200 Contracts by BD+C as well as the 17th stop design-build contractor by ENR. Their client portfolio includes some of the world’s top companies such as Kellog’s, Coca-Cola, and Kraft-Heinz. Click here to visit Alston Construction's website.

Economic Impact Consultant: Baker Tilly US, LLP

Baker Tilly’s EB-5 team provides consulting services to regional centers and projects - specializing in economic studies, business plans, regional center operational plans, and TEA analysis. Baker Tilly has prepared over 1,200 economic studies to evaluate and summarize the job-creation and economic impact attributed to regional center and individual EB-5 projects. Baker Tilly’s methodologies and economic research are well-vetted and considered to be in accordance with the best practices and standards of professional economists nationwide. Click here to visit Baker Tilly's EB-5 webpage.

Strengths

Strong Developer Track Record

The project developer, Adrian Zecha’s team at Mahaman, is a world famous resort developer with a strong track record. The company founders have been involved in several successful and renowned real estate projects throughout the United States including Amangiri, Setai Miami, Setai NYC, 400 Fifth Avenue, and Amangani - the most profitable hotel in the United States. This extensive experience and proven success in high-end, luxury developments demonstrate the developer's expertise and capability to deliver exceptional projects. The established reputation of Adrian Zecha and his team ensures a high level of professionalism, quality, and reliability, which significantly reduces the risk for EB-5 investors. The history of successful and iconic projects provides assurance that the current development will be managed and executed to the highest standards, making the investment safer and more attractive for EB-5 investors by aligning with a developer known for excellence and successful project delivery.

Strong Regional Center Track Record

Golden Gate Global (GGG) was established in 2011 and has raised more than $750 million in EB-5 investments across 15 projects, maintaining a 100% approval rate from USCIS. This impressive track record demonstrates GGG's reliability and expertise as a regional center. The consistent approval rate signifies GGG's proficiency in managing and structuring EB-5 projects that meet USCIS requirements, thus providing a higher level of confidence for investors.

Job Creation

The project is estimated to create over 3,800 jobs, providing EB-5 investors with a job cushion of 80%, thereby increasing the safety of the immigration petition for EB-5 investors. The EB-5 program requires each investor to create or preserve at least 10 full-time jobs for U.S. workers. With the project generating a large number of jobs, far exceeding the minimum requirement, there is a significant buffer that enhances the security of each investor's immigration petition. This job cushion ensures that even if there are unexpected changes or delays in the project, the required job creation targets are still likely to be met, thereby reducing the risk of denial for the investors' petitions.

Rural Project with Priority Processing

The Anasu Resort is in a rural area and qualifies for the annual 20% set-aside for rural projects as per the EB-5 Reform and Integrity Act of 2022 (RIA). Investors may quality for priority processing for Form I-526 and receive approval in as little as a few months. Investors may qualify for priority processing for Form I-526 and receive approval in as little as a few months. This expedited processing reduces the waiting time for investors, allowing them to move forward with their immigration and investment plans more quickly.

Substantial Developer Equity Contribution

The developer has guaranteed to contribute over 56% of the project cost in equity. This substantial investment from the developer significantly reduces the financial risk for EB-5 investors. When a developer invests a large portion of their own capital into a project, it demonstrates a strong commitment to the project's success. Furthermore, a higher equity contribution reduces the reliance on external financing, decreasing the project's overall debt burden and enhancing its financial stability. This makes the investment safer for EB-5 investors by ensuring that the project has a solid financial foundation and that the developer is highly motivated to ensure its successful completion and operation.

Completion and I-526 Denial Repayment Guarantees by Developer

The developer promises to complete the project regardless of the amount of EB-5 investment. This guarantee ensures that the project's success is not solely dependent on the EB-5 funding, thereby reducing the financial risk for investors. The developer's commitment to complete the project provides added assurance that the development will reach completion, protecting the investors' interests.

Additionally, the project promises to repay EB-5 investors the full amount of their capital contribution in the event of I-526 denial. This repayment guarantee significantly enhances the safety of the investment by ensuring that investors will not face severe financial loss if their immigration petitions are denied. These guarantees collectively provide a safety net for EB-5 investors, offering both the assurance of project completion and financial protection, thereby making the investment much safer.

2-Year Senior Loan Term with Two 1-Year Extensions

The project offers a short loan term of only two years for EB-5 investors, with the possibility of extending for an additional two years if necessary. This short initial loan term provides a quicker timeline for investors to potentially see returns on their investment, which can be particularly appealing for those seeking a faster resolution. The option to extend the loan term by up to two additional years offers flexibility, allowing for adjustments in case of unforeseen delays or market conditions.

Risks

The purchase of units in an EB-5 investment involves a high degree of risk and is suitable only for persons of substantial means who can bear the risk of loss of their entire investment and who have no need for liquidity in their investment. All prospective investors should carefully consider the following risks and consult their own legal, tax, and financial advisors prior to the purchase of units.

Little Diversification of the Investment

The capital contributions will be invested into one single asset, the EB-5 loan, thus providing limited diversification. The Company will invest its capital in the project located in one area - Guenoc County, California, thus providing little geographic diversification for the project.

Success is Dependent upon the Successful Implementation of the Business Plan

The success of the company will largely depend upon the Borrower’s success in implementing the Business Plan for the benefit of the Borrower. Because many of the factors necessary for success are beyond the control of the Borrower, there can be no assurance that the Borrower will be able to successfully implement the Project Business Plan or carry out the Project Business Plan as circumstances require. Through its equity investment in the Project, however, the Borrower is incentivized to effectively carry out the Project Business Plan. The project is subject to insurance risks and distributions are not guaranteed.

While, as with any investment, no assurances can be given that the Project will operate profitably. The Borrower’s affiliates’ strong operational track record in the industry serve to mitigate this risk.

The Investment is Illiquid

There is no established market for the Project. There are a limited number of investors and strict restrictions on the transferability of Units. No complete assurance can be given that the Loan will be repaid or when it will be repaid.

Regulatory Risks

Potential changes in the EB-5 program regulations can directly impact investor opportunities and project feasibility. Legislative amendments or shifts in policy by the United States Citizenship and Immigration Services (USCIS) could alter investment requirements, processing times, or the criteria for job creation and project eligibility. Any regulatory changes that slow down the visa approval process may delay investors' ability to obtain green cards. The EB-5 program is currently authorized until September 2027. Changes to American political leadership may also alter the current and/or future state of the program.

Market Risk

Success of the project will, in part, depend on the local, national and global economies. An uncertain economic outlook may adversely affect consumer spending on residential housing, as consumers spend less in anticipation of a potential further economic downturn. Considering the current economic climate, several market risks need to be carefully evaluated, such as interest rate volatility, which can impact affordability, and inflationary pressures that may drive up construction costs. Additionally, changes in employment rates, regulatory policies, and global economic or political factors could further influence project demand and profitability.

Limited Transferability of Units

The units are not readily transferable and no transfer of Units may be made by Investors. Once you subscribe to the project, you may not transfer your units to another individual. The Units are being sold in reliance on exemptions from the registration requirements of the Securities Act provided by Regulation S and/or Section 4(a)(2) of the Securities Act or Regulation D, and may not be transferred or resold except as permitted under such laws.

Operational Risks

Delays in the construction timeline can lead to increased costs and missed deadlines, potentially jeopardizing project viability. The performance of contractors is also pivotal; inadequate workmanship, resource mismanagement, or financial instability among contractors can severely disrupt progress. Moreover, unforeseen environmental issues, such as adverse weather conditions, can cause significant setbacks and necessitate costly remediation efforts. Further, the project has no operating history and therefore its operations are subject to all of the risks inherent in a new business enterprise.

Possible Cost Overruns

Cost overruns may be encountered as a result of numerous factors. The increase in the domestic inflation rate, and the resulting increase in the federal interest rate, will increase construction and operating costs. Furthermore, other unforeseen issues may be encountered that otherwise require an increase in the development budget that have not otherwise been reserved for in the contingency fund. The timeline for completion of this project is uncertain, any delays could result in a cost overrun.

Exit Strategy Risks

If the project fails to sell units as anticipated, it can lead to delays in generating the necessary revenue to repay investors. This shortfall can result from market fluctuations, increased competition, or misalignment with consumer demand. This shortfall can result from market fluctuations, increased competition, or misalignment with consumer demand. Such scenarios could lead to extended holding periods for your investment or reduced returns.

Limited Rights to Participate in Management

EB-5 investors will not make decisions with regard to the management and operations of the project. EB-5 Investors will have no role in the management or operations of the project.

Conflict of Interest

The NCE, the NCE Manager, the Developer, the Regional Center, and the General Partner are all affiliated companies, sharing common ownership or management. This interconnected relationship can lead to potential biases and lack of impartiality in decision-making processes. Moreover, these entities worked with the developer on previous EB-5 projects, which could influence their current project decisions. Such affiliations could compromise the transparency and objectivity required to protect investors' interests, potentially leading to decisions that favor the affiliated companies and developer rather than ensuring the project's integrity and compliance with EB-5 regulations. The parties are not required to disclose any compensation that they may receive from other businesses they own separate from the Project. These parties are not required to devote all of their time and attention to the project and are allowed to devote efforts to other affairs. The parties have and will continue to acquire and operate other real estate projects for their own respective accounts, even if such projects are in direct competition with the Anasu Resort.

Lawful Source & Path of Funds

EB-5 Investors are required to provide documentary evidence showing the legal source of their funds and its pathway to the EB-5 investment. An investor may be unable to provide sufficient evidence for their funds and may not receive I-526 approval for this reason.

No Assurance of Visa

There is no guarantee that an EB-5 investor will receive I-526E petition approval. The EB-5 Program has many requirements that must be met to the satisfaction of USCIS. The failure to meet even one of these requirements to the satisfaction of USCIS may result in the denial or revocation of an I-526E Petition.

USCIS regulations governing lawful permanent residence for investors do not state specifically all the criteria that USCIS must apply to determine eligibility for the removal of conditions to lawful permanent resident status. Even after I-526E Petition approval, there can be no assurance that the Investor, his or her spouse or any of their minor, unmarried children will be granted lawful permanent residence. The grant of such immigration status is dependent, among other things, upon the personal and financial history of each applicant. Any one of the several government agencies may determine in its discretion, sometimes without the possibility of appeal, that an applicant for lawful permanent residence is excludable from the United States.

More investment related risks can be found in the Private Placement Memorandum on page 110.

Investor Suitability

As a potential EB-5 Investor, understanding the risks and benefits of the EB-5 program is essential to determine if it is a suitable investment for you and your family. The EB-5 program is most suitable for investors who are seeking permanent residency in the United States. An investment in an EB-5 project is long-term, illiquid, high-risk, and has a low rate of return. The primary benefit of an EB-5 investment is permanent residency in the United States. The following pages will detail these points:

Foreign Nationals Seeking Permanent Residency in the United States

The primary benefit of the EB-5 program is permanent residency in the United States. This project and investment is most suitable for foreign nationals seeking a path to permanent residency and citizenship for themselves, their spouse, and any family members under the age of 21. Investors who wish to permanently relocate to the United States with the freedom to live, work, and study without restrictions are well suited to this investment.

Long-Term Commitment and Illiquidity

This investment is particularly suitable for investors who do not require immediate liquidity. The nature of EB-5 investments necessitates a long-term commitment, often spanning several years from the initial application to the final approval of permanent residency. Investors should be prepared for their capital to remain tied up in the project throughout the conditional residency period and beyond. This investment is non-transferable and highly illiquid, meaning you cannot sell the investment or transfer it to another investor.

This characteristic aligns well with the investment goals of individuals who can afford to allocate a portion of their portfolio to a non-liquid asset, focusing on the long-term benefits of U.S. residency rather than short-term financial returns. The potential for eventual returns on investment, coupled with the immigration benefits, makes this an ideal opportunity for those with the financial flexibility to sustain a longer investment horizon. If you are concerned about whether or not an EB-5 investment is appropriate for your specific financial situation, please speak to one of our registered broker-dealers to help evaluate your suitability for the EB-5 program.

Visa Retrogression

As a rural project, Investors in this project qualify for priority processing and set-aside visas. Investors from countries in visa retrogression, most commonly mainland China and India, can avoid the long processing times and visa availability issues by investing in a rural project. This specific type of project can save you and your family years of waiting for I-526 approval.

Reduced Investment Threshold

Investing in a rural EB-5 project offers the benefit of a reduced investment threshold compared to urban projects. The minimum required investment for rural projects is $800,000, compared to $1,050,000 for non-rural projects. This lower threshold reduces the financial burden on the investor, while still providing the same potential benefits in terms of residency and return on investment.

Risk Tolerance

The EB-5 program requires that the invested capital be at risk to qualify, meaning there is no certainty of financial returns or even the return of the principal investment. This investment is suitable for investors who possess a high tolerance for risk, as there are no guarantees associated with EB-5 investments. Additionally, the success of the immigration process hinges on the project's ability to meet job creation requirements and other regulatory criteria. Investors must be comfortable with these uncertainties and should be prepared for the potential of financial loss. Those who can accept and manage these risks, while focusing on the long-term goal of obtaining U.S. permanent residency, will find this investment opportunity aligns well with their risk profile and strategic objectives.

Low Rate of Return

This project offers investors a rate of return at 0.25%. This is a fairly low rate of return in comparison to other investment types, but average for EB-5 investments. However, it is important to consider that the primary benefit of the EB-5 program is not the return on investment, but the opportunity to gain US permanent residency. The value of this opportunity extends far beyond financial gains, as it opens doors to a host of benefits, including access to educational, professional, and lifestyle opportunities in the United States. This investment opportunity is particularly suitable for investors who prioritize the attainment of U.S. permanent residency over seeking a high rate of return on their investment.

Source of Funds

Ensuring that your EB-5 investment is well-documented and originates from a legal source of funds is imperative for compliance with program requirements and immigration laws. Detailed documentation demonstrating the lawful accumulation and pathway of funds provides transparency and strengthens the investor's application, mitigating the risk of delays or denials. Investors unable to demonstrate the legality of their investment funds are not suitable candidates for the EB-5 program. Investors must work with an experienced EB-5 Immigration Attorney to ensure that their source and path of funds is well-documented and legal.

Investor Information

Investor Management Participation

No investing member has any right to participate in the management or control of the business and affairs of the Company. The experienced management team will handle all operational and administrative tasks, ensuring the smooth execution and oversight of the investment. This structure allows investors to focus on the benefits of their EB-5 journey, such as obtaining U.S. permanent residency, without the burden of day-to-day involvement in the project's management. This arrangement ensures that investors can have confidence in knowing that their investment is being professionally managed by a dedicated team.

Investor Distributions

The targeted return rate for investors in this project is 0.25%. All distributions of interest are contingent upon the Company receiving interest payments from the Borrower.

Investor Communications

Investors will receive regular updates on construction progress, financial reports, job creation status, and any material changes directly from the Golden Gate Global Team. Additionally, investors are welcome to reach out to their Immigration Attorney or EB-5 Choice at any time with questions about their investment status and immigration application.

In the Event of I-526 Denial

If I-526 is denied, the company will try to find a replacement investing member. If they do not find a substitute member within 30 days, the JCE will repay the Company the investor's principal on or before 90 days after they receive notice of the rejection. This does not apply if the I-526 was withdrawn or rejected due to false information, criminal activity, etc. The company may refund the Investing Member his or her subscription proceeds and a portion of his or her administrative fee in the event of I-526 denial.

In the Event of I-526 Withdrawal

If for any reason an Investor decides they would like to withdraw their I-526 application, they will lose all possible immigration benefits of the EB-5 visa. Neither the Company nor the JCE shall have any early repayment obligations. The Company will attempt to find a substitute investing member. A $5000 withdrawal fee will be removed from the subscription proceeds. It is at the discretion of the Company and/or the Manager to return the administrative fee, however they are not required to return any portion of it. Please see page 22 for more information about the risk of investing in this EB-5 project.

Voting Rights

Investors have the right to vote on the following matters:

a) any amendment of the Articles of Organization;

b) any merger, consolidation, or combination of the Company with any other entity;

c) any appointment of a new Manager following the withdrawal of the existing Manager, and;

d) any election to continue the business of the Company after withdrawal of a Manager.

Rights as an Investor

Each Investing Member is required to contribute their Capital Contribution to the Company as stated in their Subscription Agreement. In exchange, they will receive the corresponding Membership Interest. Investing Members acknowledge that the Company needs their Capital Contributions to start operations, even before their I-526E Petitions are approved by USCIS. Therefore, their funds will be transferred from the Escrow Account to the Company's separate account upon filing the I-526E Petition, becoming available for use in the Project immediately.

Investing Members are not personally responsible for the Company's debts or losses. They are not involved in managing or controlling the business and have no authority to act on behalf of the Company. Membership Interests in the Company are considered personal property. Investing Members or their successors, representatives, or assigns have no claim on specific Company assets.

Investing Members cannot sell or transfer their Interest unless due to death. The Manager is responsible for maintaining accurate accounting records according to accepted principles. Investing Members or their authorized representatives can review these records at their own expense during normal business hours with reasonable notice.

Tax Implications

Investors should consult with a personal tax advisor regarding the potential state and local tax consequences of an investment in the Company prior to investment in the project.

There are restrictions on transferring, assigning, or disposing of the Units. Generally, a U.S. Investor will recognize capital gain or loss when they sell, redeem, exchange, or otherwise dispose of their interest in the Company, except for amounts related to interest (which will be recognized as ordinary interest income) if the U.S. Investor has not previously included the accrued interest income. The ability to deduct capital losses may be limited, and these limitations will vary depending on each taxpayer's situation. Therefore, each Investing Member should consult their own tax advisors regarding these limitations.

Subscription Procedures

To subscribe to this project, investors must complete a wire transfer of $870,000. Detailed subscription instructions will be provided to potential investors upon agreement to proceed with the project when working with our broker-dealer, EB-5 Choice. An Investing Member irrevocably subscribes for and agrees to purchase a Unit and fund the subscription amount upon execution of the subscription agreement. The Manager reserves the right to reject a subscription. If the Subscription is accepted, the Company will notify the accepted Investing Member of the scheduled date of funding. If the Subscription is rejected in full, all funds received from the Investing Member will be returned without interest. More details are in the Subscription Agreement.

Investor Exit Strategy

The JCE’s strategy to repay the EB-5 senior secured loan, thereby allowing the NCE to return the investors’ capital, is to:

i) obtain a permanent senior secured loan supported by the $14 million of stabilized NOI in Year 3

ii) generate over $491 million of anticipated income from the sale of the 164 finished lots.

DISCLAIMER

July 2024

EB-5 Choice has undertaken an independent due diligence evaluation of the Anasu project, designed for foreign investors who intend to participate in the EB-5 Immigrant Investor Program.

The objective of this report is to accomplish the following:

1. Ensure compliance with the EB-5 Reform and Integrity Act of 2022.

2. Conduct an impartial and autonomous review of the offering documents.

3. Provide a concise summary of the significant provisions.

4. Employ appropriate procedures to verify the accuracy and reasonableness of the information provided by the offering party.

It should be noted that the review's scope may be limited to the documents supplied by the offering party if third-party information is unavailable. This report is not intended as a recommendation to invest or abstain from investing in the specific offering. Rather, its purpose is to consolidate the investment proposal, facilitate comprehension of the offering, and aid the reader in identifying its strengths and weaknesses through the procedures we have executed.

Any decision to invest should be made subsequent to a thorough review of all documents and consultations with appropriate professionals to determine suitability and risk tolerance. Furthermore, please be aware that the due diligence report reflects our viewpoint and does not incorporate potential developments or changes occurring after the report's listed date.

The “EB-5 immigrant visa” preference category is intended to encourage the flow of capital into the United States economy and to promote employment of workers in the United States. To accomplish these goals and so that foreign investors may obtain immigration benefits for having made an investment, the EB-5 Program mandates that:

(i) foreign investors must make a minimum capital contribution of $1,050,000; In certain rural areas or

areas of high unemployment (“Targeted Employment Area” or “TEA”), the

investment may be as low as $800,000.

(ii) that such minimum capital be deployed exclusively in job creating activities; and (iii) 10 full-time jobs

be created on account of each investor.

LEGAL NOTICE

Please be advised that this due diligence report is provided solely for informational purposes and should not be construed as an offer to sell or a solicitation to purchase any securities mentioned herein. Any offers can only be made in compliance with relevant laws and regulations, and qualified investors must receive official offering and subscription documentation.

The report contains summaries of specific terms found in relevant documents and agreements. If any of the terms, conditions, or provisions in the actual documents and agreements conflict with or contradict the descriptions or terms provided in this report, the terms of the actual documents and agreements shall take precedence. In the event that a translated version of this report is created for convenience or any other purpose, the provisions of the original English version shall take precedence. If there are any discrepancies between a translated version and the English version, the original English version shall take precedence.

In the event of any discrepancies between the information presented in this report and the Company's Memorandum, the provisions of the Memorandum shall govern. None of the information or analyses presented herein are intended to serve as the sole basis for making any investment decision, and no specific recommendations are being made. Certain information included in this report may have been obtained or derived from sources prepared by third parties, and while we believe such information to be reliable for the purposes of this report, we assume no responsibility for its accuracy.

EB-5 Choice expressly disclaims all liability for any direct or consequential loss or damage of any kind arising directly or indirectly from: 1) reliance on any information found in this report, 2) any errors, omissions, or inaccuracies in such information, or 3) any actions taken as a result thereof.

Before making any major investment decisions, know your rights as an investor.

See the following websites for more information:

Financial Industry Regulation Authority Website - FINRA
Securities Investor Protection Corporation Website - SIPC
United States Citizenship and Immigration Services - USCIS