Business
Trump’s ‘Gold Card’ Set Off Panic in an Unexpected Place: Real Estate
President Trump’s plan to sell green cards for $5 million each, a program he is calling a “gold card,” has largely been met with a shrug. It’s not clear exactly how the program would work, if it’s legal or how many potential immigrants would really pay $5 million for a path to U.S. citizenship.
But in a niche area of dealmaking, alarm bells are blaring.
Howard Lutnick, the commerce secretary, said on Tuesday that the plan to effectively sell green cards would replace the EB-5 investor visa, a favorite source of funding for major real estate projects.
Massive developments — from New York’s Hudson Yards to the San Francisco Shipyard to, yes, Trump Plaza in Jersey City — have been financed in part by overseas investors applying to the EB-5 program, which grants permanent U.S. residence. Such investors are motivated by a green card, not by maximizing returns, and so for developers their capital tends to be less expensive than borrowing money from a typical commercial lender.
The real estate company owned by the family of Trump’s son-in-law, Kushner Capital, drew scrutiny for its use of EB-5 funding during the first Trump administration.
Overall, the EB-5 program does not bring in a lot of money — about $4 billion last year in the context of the $28 trillion U.S. economy — but it represents a huge profit bump for a small but powerful political contingency: major real estate developers. They are not likely to see EB-5 killed without a fight.
“Cheap capital is the crack cocaine to the real estate industry and probably every other industry,” said Matt Gordon, the C.E.O. of E3iG, which advises both foreign investment-based visa applicants and U.S. companies seeking funding.
“They and their rather large political donations are going to be very motivated.”
Some background: EB-5 visas were established in 1990 to encourage investment in rural and economically depressed areas. Foreigners who invest either $800,000 or $1.05 million, creating at least 10 jobs, are eligible. Initially, that meant directly creating 10 jobs. Now most companies meet the requirement by showing the overall economy will gain 10 jobs as a result of each investor’s funding.
All sorts of companies can seek EB-5 investment — DealBook heard about pharmacies, hospitals, day care centers and manufacturing plants that raised money through the program — but the vast majority are real estate deals.
News of Trump’s gold card plan sent this ecosystem reeling. “Naturally the whole world is panicking,” said Ishaan Khanna, the president of the American Immigrant Investor Alliance, a group that lobbies on behalf of EB-5 investors. “As India and China woke up, my phone blew up.”
“Everybody I’m hearing from is like ‘rush’ — get in as much as you can, because who knows how long” the program will last in its current form, Gordon said, “On both the sponsor side and on the immigrant side.”
Developers who qualify for the program win big savings. For example: One project Gordon is working on, a $100 million 19-story apartment building, qualifies for about $35 million of EB-5 funding. Traditional mezzanine debt financing for such a project might come with an interest rate of 10 or 12 percent, Gordon said, but the developer will pay 5 to 7 percent for EB-5 funding. “You’re really cutting, you know, 30 to 50 percent of your cost of capital, on a rather significant portion of your capital,” he added.
On top of saving money, developers say the program has been crucial during periods like the financial crisis when other funding sources become prohibitively expensive or scarce.
Unsurprisingly, the real estate industry has been one of the EB-5 program’s most ardent defenders. The National Association of Realators and the U.S. Chamber of Commerce lobbied against a bill introduced in 2017 that would have terminated the program.
Such programs aren’t unusual. Seventy countries exchange permanent residency or citizenship for investments or donations, according to Kristin Surak, an associate professor at the London School of Economics who studies so-called golden visa and passport programs worldwide. In some countries, including Malta and Cyprus, the programs represent a significant part of the economy.
Proponents point to the jobs created. Critics say the EB-5 program falls short of its goal to stimulate investment in rural and distressed urban areas. Previous iterations allowed developers to gerrymander maps so that even densely populated and highly employed districts like Hudson Yards qualified for preferable terms. A 2022 law ended that practice and added new incentives to build in rural areas.
Would selling visas work better? Lutnick said on Wednesday that EB-5 projects “were often suspect, they didn’t really work out, there wasn’t any oversight of it.” It’s true that there have been horror stories: Two investors who raised $350 million from foreign investors for a massive development in Vermont, for example, were accused in 2016 of perpetrating the biggest fraud in the state’s history.
But according to a report from the Government Accountability Office that looked at pending petitions in 2021, less than 1 percent were found to be fraudulent or posed national security risks (about 3 percent were investigated). Additional safeguards were added in the 2022 law.
The gold card may have a different problem: A dearth of applicants. Participants in the EB-5 program expect to get their $1 million investment back at some point, whereas Trump’s plan requires a $5 million donation that isn’t returned.
The EB-5 program drew about 7,000 investments between April 1, 2022 to July 31, 2024, according to data compiled by the American Immigrant Investor Alliance. Even if the gold card comes with a tax benefit, why would a substantially larger group of foreigners — Trump said “maybe a million” — be willing to pay the much higher cost?
Many in the industry see Trump’s plan as unworkable. Trump would need congressional approval both to abolish a visa program that was created by law and to allocate visas for a new one. “This is unpredictable,” Khanna said. “No one truly knows where this is going.”
More than Trump’s recent announcement, which lacked specifics, many of the big players in the ecosystem — including the companies that put together the funds, the developers and the lawyers — are focused on what will happen in 2027, when the EB-5 program expires and needs to be renewed by Congress.
They’re betting on compromise. The players in such investments are hoping the gold card becomes an addition rather than a replacement.
The idea may already be breaking through: By Wednesday, Lutnick had changed how he described the gold card plan, saying it would “modify” the EB-5 program, but it was unclear what specifically would change.
— Sarah Kessler
In Case You Missed It
President Trump’s meeting with President Zelensky of Ukraine turned into an explosive shouting match on live television, a moment unlike anything we’ve ever seen at the White House. At an Oval Office appearance Friday the Ukrainian president met with Trump to sign a mineral rights deal, when Trump accused Zelensky of being ungrateful and “gambling with World War III.” Zelensky had questioned whether Trump would be able to get President Putin of Russia to honor a peace agreement without security guarantees, saying the Russian leader had broken cease-fire accords in the past. Vice President Vance, sitting on a nearby couch, chastised Zelensky for not showing more appreciation for Trump’s efforts. The U.S. president then issued an ultimatum: “You’re either going to make a deal or we’re out.” The fiery exchange (here’s the video) revealed Trump’s nakedly combative approach to dealmaking. Zelensky left without signing the mineral agreement. Elon Musk, whose Starlink satellite internet service has been vital to Ukraine’s military defenses, seemed to praise Trump on X after the exchange.
Shari Redstone urged her board to find a resolution with President Trump. Redstone, who is trying to sell Paramount, her family business, to David Ellison’s Skydance, directed her board to find a way to resolve Trump’s lawsuit against the company’s CBS News division, DealBook was first to report. The president sued the company last year for $20 billion, accusing the network of deceptively editing an interview with Vice President Kamala Harris to cast her in a more favorable light. Even though legal experts say Trump has a weak case, some Paramount executives feel a settlement would smooth the way with the Trump administration toward greenlighting the company’s Skydance merger.
Apple’s Tim Cook gave a lesson in the art of dealmaking with President Trump. The Apple leader drew praise from Trump for his commitment to invest $500 billion in the United States and create 20,000 more jobs over the next four years. The stakes are high for Apple because its iPhones are primarily made in China, which faces an additional 10 percent tariff on exports. But Cook appeared to take a page out of his playbook from Trump’s first term, when he pledged more U.S. investment and won tariff exemptions. By the way, that $500 billion commitment was probably already earmarked. Expect similarly framed corporate announcements to follow.
The S.E.C. said memecoins aren’t like stocks and bonds. That means you and I can trade them at our own risk and the novelty crypto tokens — including those tied to President Trump and the first lady, Melania Trump — won’t be subject to regulatory oversight. Trump, whose presidential campaign was backed by top crypto executives, has promised less regulation for the industry. Even so, the price of Bitcoin has plunged in recent days, stoking concern about crypto volatility.
Weighing a return to Russia
President Trump and President Putin of Russia marked the third anniversary of the Kremlin’s full-scale invasion of Ukraine this week with a similar message: Russia will soon be open for business. Never mind that Russia and the United States remain far apart on the fundamental terms of a peace negotiation, or that Russia is under heavy sanctions by Western countries, or that uncertainty over the region’s future has only grown after yesterday’s Oval Office blow-up.
DealBook spoke with Charles Hecker, a former reporter for The Moscow Times and a geopolitical risk consultant who for decades advised Western companies on expanding their business in Russia, about the prospect of business leaders taking Trump and Putin up on the pitch. (A reminder: most, but hardly all, Western companies left Russia shortly after war in Ukraine broke out.)
Hecker is the author of the book “Zero Sum: The Arc of International Business in Russia,” which is set for publication in the United States next week. This interview has been edited for brevity.
The assumption is that Western, and especially American companies, will not return to Russia any time soon. How do you see it playing out?
Inside a number of companies, conversations are already taking place about whether and how to go back to Russia. And those conversations probably preceded this flurry of diplomatic activity between Moscow and Washington. There are also companies that have decided already, resolutely, that they are not going back. What this speaks to is risk appetite. There are clearly companies that have cast iron stomachs and bottomless appetites for risk. Those are the companies that are probably considering going back to Russia most actively.
Who might they be?
These are companies in the energy sector, and more broadly, in the natural resources sector. These are companies that are thoroughly accustomed to doing business in very-high-risk jurisdictions.
For companies with a higher appetite for risk, what kind of negotiated resolutions between the West and Russia would they view as a kind of all-clear?
One of the red lines is sanctions. If part of the resolution of the war on Ukraine is sanctions relief, then there will be companies that see that, essentially, as a signal to go back.
What kind of Russia is waiting for them?
Over the past three years there have been some changes that have taken place that will be very, very difficult to reverse. We all know of the famous headline-grabbing nationalizations and reallocations that took place, like Danone and Carlsberg — really high profile expropriations. There is a new business elite in Russia that is one level below the individuals who have been sanctioned who serve largely at the pleasure of the Kremlin. This new business elite has possession of a great number of very shiny new toys that were previously Western companies. It’s a valid question to ask about whether these new owners are going to want to give their shiny new toys back. And if they do, whether under political pressure or otherwise, what would the cost be?
Thanks for reading! We’ll see you Monday.
We’d like your feedback. Please email thoughts and suggestions to dealbook@nytimes.com.
Business
California attorney general asks judge to block Nexstar-Tegna merger
California Atty. Gen. Rob Bonta is asking a judge to unravel Nexstar Media Group’s $6.2-billion acquisition of rival TV station owner Tegna — the latest in a flurry of merger twists.
Nexstar announced late Thursday that it had consummated the Tegna takeover — despite a lawsuit that Bonta and seven other Democratic state attorneys general had filed in federal court the previous day.
The state officials sued to block the union of the station groups, alleging the new colossus would violate antitrust rules and a federal law limiting broadcast station ownership.
The lawsuit was filed in U.S. District Court in Sacramento.
Hours after that filing, the Federal Communications Commission’s Media Bureau in Washington approved Nexstar’s deal — clearing the way for the nation’s largest TV station group owner to swallow the third-largest station group.
The purchase gives Nexstar, which owns KTLA-TV Channel 5 in Los Angeles, 265 television stations.
On Friday, Bonta and the other attorneys general asked a judge for a temporary restraining order to freeze the takeover until a hearing on the matter.
“Nexstar/Tegna is not a done deal,” Bonta said Friday in a statement. “I will not let these corporate behemoths merge without a fight.”
It was not immediately clear when a judge might rule on the request for a restraining order.
Bonta appeared at a lawmakers’ hearing in Burbank on Friday to explore the impacts of another huge merger: Paramount Skydance’s proposed $111-billion takeover of Warner Bros. Discovery. Bonta’s office has opened an investigation into the Paramount-Warner merger, but Bonta said Friday that no decision has been made on whether he or other attorneys general will seek to block it.
For now, he is focused on derailing the Nexstar-Tegna deal.
“We filed a suit before that deal closed,” Bonta told The Times. “We think our case is extremely strong. There is no way this should be approved.”
At issue is whether the FCC had the power to grant a waiver that would allow Nexstar to control TV stations that reach nearly 80% of U.S. households. In 2003, Congress set the station ownership cap at 39% of the country.
The Department of Justice also gave its blessing to close the deal.
The three FCC commissioners did not vote on the matter — despite pleas from the lone Democrat on the panel who advocated for an open process.
Approval of the merger was rapid after President Trump endorsed the consolidation on Feb. 7.
“We need more competition against THE ENEMY, the Fake News National TV Networks,” Trump wrote in his social media post.
“Letting Good Deals get done like Nexstar – Tegna will help knock out the Fake News because there will be more competition, and at a higher and more sophisticated level,” Trump wrote. “GET THAT DEAL DONE!”
In a statement Thursday, Nexstar founder and chief executive Perry Sook thanked Trump and FCC Chairman Brendan Carr, saying Nexstar was “grateful” they recognized the “dynamic forces shaping the media landscape” and allowed the transaction to move forward.
Business
Where Oil and Gas Sites Have Been Attacked During Iran War
Multiple strikes
in Tehran
At least 37 energy oil refineries, natural gas fields and other energy sites in nine countries have been damaged since the United States and Israel began bombarding Iran, a New York Times analysis found. Some have been struck by drones. Several have been hit more than once.
As the attacks escalate, both sides increasingly view energy as a potent target — one that is capable of inflicting severe economic pain. Iran depends on oil and natural gas to keep the lights on and its government running, while the United States wants to prevent prices from soaring further and damaging the underpinnings of the global order.
The question is no longer just when Iran’s tight grip on the Strait of Hormuz, a narrow but critical passage on its southern coast, will ease enough for most ships to pass. It is also how long it will take to complete repairs needed to produce and process oil and natural gas in the first place.
“The longer this war goes on, the more likely it is that the two sides are going to play their strongest energy-leverage cards,” said Clayton Seigle, an energy expert at the Center for Strategic and International Studies, a Washington research group. “The attacks on facilities are not easily reversible.”
To count the number of attacks and disruptions at energy facilities in the region, The New York Times reviewed statements from government, state-run and private energy companies. The Times also reviewed lists compiled by ClearView Energy Partners and the Institute for the Study of War, two research firms, and subsequently verified their findings.
Through Friday, The Times had found a total of 45 attacks, though there is no official accounting and more may have occurred. Strikes occur seemingly every day.
The importance of energy in the war became even clearer after Israel struck facilities tied to Iran’s South Pars gas field on Wednesday. Iran responded by lashing out across the Gulf. At least 10 sites were damaged this week, The Times found, including an energy hub in Qatar, as well as oil refineries in Kuwait, Saudi Arabia and Israel.
The various attacks sent oil and natural gas prices soaring as traders worried that much of the Gulf’s energy could remain effectively landlocked for a while, possibly months. Brent crude, the international oil benchmark, briefly topped $119 a barrel on Thursday morning before retreating. Oil fetched less than $73 a barrel before the war started on Feb. 28, a price that reflected the possibility of a war.
“It’s been the cumulative effect that’s really driven this crisis,” said Raad Alkadiri, a Washington-based political risk analyst who specializes in energy and the Middle East.
While oil has been front and center, analysts are especially concerned about the damage to the world’s largest natural-gas export terminal, called Ras Laffan, on Qatar’s coast.
The sprawling facility, which is operated by the state-owned QatarEnergy company, cools natural gas into liquid that can be loaded onto tankers and shipped. But Qatar said on the third day of the war that it had stopped producing liquefied natural gas, citing military attacks.
This week’s strikes caused further damage, compromising 17 percent of the country’s L.N.G. export capacity, QatarEnergy said on Thursday, adding that repairing the damage could take up to five years.
There is no easy replacement for that fuel, which is used to generate electricity and heat homes. And there is little spare L.N.G. capacity in other countries.
Other points of vulnerability include the oil export terminals where the United Arab Emirates and Saudi Arabia are rerouting oil to avoid the Strait of Hormuz. One of those areas, in the Emirates, was targeted as recently as this week. A refinery near the other, in Saudi Arabia, was also hit by a drone.
“It could become a lot worse if the craziness continues to prevail,” said Charif Souki, a former chief executive of Houston-based Cheniere Energy, a large L.N.G. company. “But there are so many people who have a vested interest in not letting it get too far out of hand.”
Indeed, countries around the world have agreed to release oil from emergency stores to stem rising prices. The U.S. military is also attacking Iranian vessels and drones to try to clear the Strait of Hormuz, and the Trump administration said it would lift sanctions on Iranian oil to nudge prices down.
In many cases, it is hard to know how severe the damage has been to a facility.
As Kevin Book, managing director of ClearView Energy Partners put it, “The last thing they probably want to do is tell Iran, ‘You missed me, try again.’”
Even when companies have been more forthcoming, their disclosures have sometimes only raised more questions.
Mr. Souki said he was surprised to hear that QatarEnergy expected it would take up to five years to repair its L.N.G. facilities. “I think he’s hedging his bets at the moment,” Mr. Souki said, referring to QatarEnergy’s chief executive. “You can always give good news later.”
Business
Pentagon’s Anthropic bashing rekindles Silicon Valley’s resistance to war
Artificial intelligence powerhouse Anthropic’s battle with the Pentagon has sparked some soul-searching in Silicon Valley that could reshape the tech sector’s complicated relationship with war and the White House.
Anthropic is the San Francisco-based startup behind the chatbot Claude and some of the most powerful AI on the market. In its negotiations with the military, it has demanded guardrails on how its technology is used.
The military said it refused to be beholden to a corporation and pushed back, labeling Anthropic a threat akin to an enemy foreign power and blocking it from some government contracts.
Tech leaders have quietly backed Anthropic, saying that AI isn’t ready for some weapons and that strong-arming companies is counterproductive and antidemocratic. President Trump called Anthropic a bunch of “left-wing nut jobs.”
How this showdown plays out will affect not only Anthropic’s booming business but also the way tech titans and other corporations work with an administration known for lashing out at resisters, said Alan Rozenshtein, an associate professor at the University of Minnesota Law School.
“On the one hand, it could cause the government’s other Silicon Valley suppliers to be more compliant, lest they be treated like Anthropic has been,” he said. “On the other hand, it could lead more companies to avoid doing business with the government at all to avoid the risk of something like this happening to them.”
As some tech trailblazers in recent years have become more comfortable with developing weapons, Southern California has emerged as a hub for defense tech startups. With a long history in defense, it has the factories, engineers and aerospace expertise to turn venture funding and military demand into weapons, satellites and other advanced systems.
The fallout from Anthropic’s showdown with the Trump administration will help determine the local winners and losers in the sector in the coming years.
While many of the key players in tech have been reluctant to join the brawl in a high-profile manner, the positions on different sides are laid out in a court case that Anthropic has pursued to get off the Pentagon’s blacklist.
Anthropic filed the lawsuit in the U.S. District Court in the Northern District of California and a petition for review in the U.S. Court of Appeals for the District of Columbia Circuit on March 9. The company is asking the court to overturn its designation as a “supply chain risk” and block the Trump administration from enforcing the government’s ban on its technology.
“The consequences of this case are enormous,” Anthropic’s lawsuit said. “The federal government retaliated against a leading frontier AI developer for adhering to its protected viewpoint on a subject of great public significance — AI safety and the limitations of its own AI models — in violation of the Constitution and laws of the United States.”
Some of Anthropic’s biggest concerns are that its technology could be used for government surveillance or autonomous weapons. It has been asking for assurances in the wording of its contracts that its AI would not be used for these purposes. While the government said it would not use the tech for those purposes, it was unable to provide Anthropic with the assurance it wanted.
Tech industry groups, Microsoft and workers from Google and OpenAI have backed Anthropic in its legal fight against the Trump administration, adding their own views to its case.
On Tuesday, lawyers for the U.S. government said in a court filing that the Defense Department started to wonder whether Anthropic could be trusted.
“Anthropic could attempt to disable its technology or preemptively alter the behavior of its model either before or during ongoing warfighting operations, if Anthropic — in its discretion — feels that its corporate ‘red lines’ are being crossed,” the government said in the filing.
The Department of Defense and Anthropic declined to comment.
The tech industry has a long, complicated history of working with the military. In the 1960s, the Department of Defense developed the internet’s predecessor, ARPAnet, to help keep military and government computers secure.
For much of this century, the big tech companies, as well as their investors, have often tried to avoid developing or promoting things that helped spy on people or kill them. Google, once known for its motto “Don’t Be Evil,” didn’t renew a controversial Pentagon contract, Project Maven, in 2018 after thousands of workers protested over concerns that AI would be used to analyze drone surveillance footage.
That has changed in recent years as there has been more money to be made in tech fixes for military problems.
Benjamin Lawrence, a senior lead analyst at CB Insights, said that advancements in AI and major events, such as Russia’s invasion of Ukraine in 2022, helped fuel a surge in venture capital investment in defense tech.
“It caused a huge shift with a lot of traditional investors looking at defense tech in a more positive light because you have a sovereign democratic nation that was invaded,” he said.
The world’s most powerful tech companies have been partnering with defense tech startups and securing government contracts.
Google has been offering AI tools to civilians and military personnel for unclassified work. The Department of Defense also awarded a $200-million contract to Google Public Sector, a division that works with government agencies and education institutions, to accelerate AI and cloud capabilities.
The industry’s allegiance with the White House and its military ambitions was strengthened with the arrival of the second Trump administration. Many of the top executives of the tech world have been supporting and advising Trump.
The recent strong-arming of one of the thought leaders of the AI revolution, however, has given many pause. Some of the resistance echoes the earlier era when the tech industry was suspicious of how governments would use its innovations.
The tech industry finds itself in a tricky spot after Anthropic’s clashes with the Pentagon. In late February, the public feud escalated after Trump assailed Anthropic and ordered government agencies to stop using its technology. His administration labeled Anthropic a “supply chain risk,” prompting the company to sue.
Trump’s actions could jeopardize hundreds of millions of dollars in contracts it has with private parties, according to Anthropic’s lawsuit. Federal agencies have started to cancel contracts.
Last week, tech industry groups such as TechNet, whose members include Anthropic, Meta, OpenAI, Nvidia, Google and other major companies, said in an amicus brief that blacklisting an American company “engenders uncertainty throughout the broader industry.”
“Treating an American technology company as a foreign adversary, rather than an asset, has a chilling effect on U.S. innovation and further emboldens China’s efforts to export its own government-backed AI technology,” the brief said.
Microsoft has also backed Anthropic, urging the court to temporarily block Trump from blacklisting the AI company. Labeling Anthropic as a supply chain risk means that Microsoft and other government suppliers will have to use “significant resources” to determine how excluding Anthropic would affect their contracts.
The U.S. government said in its filing that its concerns with Anthropic focus on its conduct and are unrelated to its speech. But Anthropic and the tech industry say the move would hurt their businesses.
In addition to Trump’s harsh criticism of the company, Secretary of Defense Pete Hegseth accused Anthropic of delivering a “master class in arrogance and betrayal.”
Anduril’s founder, Palmer Luckey, backed the Pentagon’s position, stating that it should be elected officials, not corporate executives, making military decisions. Anthropic countered, stating in a blog post it “understands that the Department of War, not private companies, makes military decisions.”
As this battle plays out, some experts say Anthropic would probably have an upper hand in court.
In its lawsuit, Anthropic said the Trump administration violated a law for labeling a company a supply chain risk, noting it doesn’t have ties to a U.S. “adversary,” such as China or Iran.
Anthropic also said the Trump administration retaliated against the company for its speech and other protected activities, violating the 1st Amendment.
“They’re just lashing out,” said Rozenshtein of the University of Minnesota Law School. “I think that’s a lot of what this is.”
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