In a follow-up circular to this week’s announcement that the Grenada Citizenship by Investment Programme had lowered its real estate investment requirement to US$220,000, the program’s CIU makes it clear that the practice of discounting CBI-real estate will not fly in Grenada.
The CIU has introduced a host of new requirements, mechanisms it hopes will prevent the real-estate discounting tomfoolery that’s plagued other programs in the region as of late.
“We have been presented with evidence that developers do not always adhere to the pricing methodology as prescribed by law,” Grenada CIU-chief Thomas Anthony tells IMI, adding that the unit will “shortly be implementing the Project Escrow Management Framework as contemplated by Statutory Rules and Orders No. 28 of 2017.”
Anthony explains that the new pricing option is first and foremost a means of stimulating the Tourism Accommodation sector ” in an effort to achieve the Government’s 2020 goal of increasing the total hotel room count to 3,000. In doing so, we must ensure that laws are observed and investment funds flow to the intended purpose; completing construction of the hotel plant.”
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The statement notifies stakeholders that “prior to acceptance by the CBI Unit of an application for citizenship in which the applicant elects an investment under the New Price Option, the subject approved project must first apply and receive written approval from the Committee for access to the New Price Option”.
The circular further reads:
An application to the CBI Committee to access the New Price Option must include the following items:
1.A copy of the standard form of Sales Contract with satisfactory provisions to ensure:
- an appropriate ownership structure;
- a purchase price in accordance with the New Price Option regulation;
- deposit of purchase price paid upon approval into a designated escrow account;
- satisfactory draw conditions for funds held in escrow.
2. A copy of the standard form of Escrow Agreement between the Investor, the Developer and the designated Escrow Agent.
3. A Declaration by the Developer addressing the following matters:
- Confirmation that the Developer has opened a project escrow account at a recognized financial institution within the State of Grenada, for the sole purposes of depositing, holding and disbursing all project investment funds collected in the name of the developer/approved project, in addition to confirmation of:
- The amount of equity invested in the approved project to date
- The amount of CBI investment received to date
- Total withdrawals of CBI investor funds
- Total project spending
4. Construction Schedule certified by the project architect and/or civil engineer and/or project manager, as appropriate depending on the stage of the project.
The letter goes on to emphasize that the promotion of product using the New Price Option is prohibited prior to obtaining the written approval of the Committee to access the New Price Option.
Since the arrival of Anthony, the CIU and Grenadian government have taken several important steps in securing the program’s integrity and improving its attractiveness; a shrimp-farming project that collected CBI-investment but later stalled is now the subject of an investigation; signed an extradition treaty with China, warning potential criminals that a Grenadian passport is no get-out-of-jail-free card; approved the sale of CBI-property in the secondary market; and widened the “dependents” definition to include siblings.
Download the circular below:
Christian Henrik Nesheim is the founder and editor of Investment Migration Insider, the #1 magazine – online or offline – for residency and citizenship by investment. He is an internationally recognized expert, speaker, documentary producer, and writer on the subject of investment migration, whose work is cited in the Economist, Bloomberg, Fortune, Forbes, Newsweek, and Business Insider. Norwegian by birth, Christian has spent the last 16 years in the United States, China, Spain, and Portugal.