dismissed L-1A Case: Real Estate Development

U.S. Citizenship 
and Immigration 
Services 
MATTER OF H-R-E-D-A-, INC. 
APPEAL OF VERMONT SERVICE CENTER DECISION 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: FEB. 22, 2017 
PETITION: FORM I-129, PETITION FOR A NONIMMIGRANT WORKER 
The Petitioner, a real estate developer, seeks to temporarily employ the Beneficiary as the president 
and general manager of its new office under the L-1 A nonimmigrant classification for intracompany 
transferees. See Immigration and Nationality Act (the Act) section 101(a)(15)(L), 8 U.S.C. 
§ 1101 ( a)(15)(L ). The L-1 A classification allows a corporation or other legal entity (including its 
affiliate or subsidiary) to transfer a qualifYing foreign employee to the United States to work 
temporarily in a managerial or executive capacity. 
The Director, Vermont Service Center, denied the petition. The Director concluded that the 
evidence of record did not establish that: (1) the Beneficiary would be employed in the United States 
in a managerial or executive capacity within one year; and (2) the Petitioner had secured sufficient 
physical premises to house the newoffice. 
The matter is now before us on appeal. In its appeal, the Petitioner submits additional evidence and 
asserts that the Director erred by focusing entirely on one readily resolved discrepancy regarding its 
proposed staffing levels, while excluding other relevant evidence. The Petitioner asserts that it has 
established that the Beneficiary would be employed in a managerial or executive capacity within one 
year and that the office secured was sufficient to meet the new office's initial needs. 
Upon de novo review, we will dismiss the appeal. 
' 
I. LEGAL FRAMEWORK 
To establish eligibility for the L-1 nonimmigrant visa classification, a qualifying organization must 
have employed the Beneficiary in a managerial or executive capacity, or in a specialized knowledge 
capacity, for 1 continuous year within 3 years preceding the Beneficiary's application for admission 
into the United States. In addition, the Beneficiary must seek to enter the United States temporarily 
to continue rendering his or her services to the same employer or a subsidiary or affiliate thereof in a 
managerial, executive, or specialized knowledge capacity. Section 101(a)(15)(L) ofthe Act. 
Matter of H-R-E-D-A-, Inc. 
The regulation at 8 C.F.R. § 214.2(1)(3)(v) states that if the petition indicates that the beneficiary is 
coming to the United States as a manager or executive to open or to be employed in a new otlice in 
the United States, the petitioner shall submit evidence that: 
(A) Sufficient physical premises to house the new office have been· secured; 
(B) The beneficiary has been employed for one continuous year in the three year 
period preceding the tiling of the petition in an executive or managerial capacity 
and that the proposed employment involved executive or managerial authority 
over the new operation; and 
(C) The intended United States operation, within one year of the approval of the 
petition, will support an executive or managerial position as defined in 
paragraphs (1)(1 )(ii)(B) or (C) of this section, supported by information 
regarding: 
(I) The proposed nature of the office describing the scope of the entity, its 
organizational structure, and its financial goals; 
(2) The size of the United States investment and the financial ability of the 
foreign entity to remunerate the beneficiary and to commence doing 
business in the United States; and 
(3) The organizational structure of the foreign entity. 
II. U.S. EMPLOYMENT IN A MANAGERIAL OR EXECUTIVE CAPACITY 
The Director determined that the Petitioner did not establish that the Beneficiary would be employed 
in a managerial or executive capacity within 1 year. In denying the petition, the Director found that 
there were a number of unresolved inconsistencies in the record with respect to the proposed number 
of subordinate employees. 
On appeal, the Petitioner attempts to resolve these inconsistencies and asserts that the Director over­
emphasized these discrepancies, while excluding consideration of other relevant evidence showing 
that the Beneficiary would be employed in a managerial or executive capacity within 1 year. 
After considering the totality of the evidence, we agree with,the Director's decision. 
Section 101(a)(44)(A) ofthe Act, 8 U.S.C. § 1101(a)(44)(A), defines the term "managerial capacity" 
as "an assignment within an organization in which the employee primarily'': 
(i) manages the organization, or a department, subdivision, function, or component 
of the organization; 
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Matter of H-R-E-D-A-, Inc. 
(ii) supervises and controls the work of other supervisory, professionaL or 
managerial employees, or manages an essential function within the 
organization, or a department or subdivision of the organization; 
(iii) if another employee or other employees are directly supervised, has the 
authority to hire and fire or recommend those as well as other personnel actions 
(such as promotion and leave authorization), or if no other employee is directly 
supervised, functions at a senior level within the organizational hierarchy or 
with respect to the function managed; and 
(iv) exercises discretion over the day-to-day operations of the activity or function for 
which the employee has authority. 
Further, "[a] first-line supervisor is not considered to be acting in a managerial capacity merely by 
virtue ofthe supervisor's supervisory duties unless the employees supervised are professional." !d. 
Section 101(a)(44)(B) of the Act, 8 U.S.C. § 1101 (a)(44)(B), defines the term "executive capacity" 
as "an assignment within an organization in which the employee primarily": 
(i) directs the management of the organization or a major component or function of 
the organization; 
(ii) establishes the g~als and policies of the organization, component, or function; 
(iii) exercises wide latitude in discretionary decision-making; and 
(iv) receives only general supervision or direction from higher-level executives, the 
board of directors, or stockholders of the organization. 
If staffing levels are used as a factor in determining whether an individual is atting in a managerial 
or executive capacity, U.S. Citizenship and Immigration Services (USCIS) must take into account 
the reasonable needs of the organization, in light of the overall purpose and stage of development of 
the organization. See section 101(a)(44)(C) ofthe Act. 
A. Duties 
When examining the managerial or executive capacity of the· Beneficiary, we will look first to the 
Petitioner's description of the job duties. See 8 C.F.R. § 214.2(1)(3)(ii). First, the Petitioner must 
show that the Beneficiary will perform certain high-level responsibilities in the statutory definition 
of managerial or executive capacity. Champion World, Inc. v. INS, 940 F.2d 1533 (9th Cir. 1991) 
(unpublished table decision). Second, the Petitioner must prove that, within 1 year, the Beneficiary 
will be primarily engaged in managerial or executive duties, as opposed to ordinary operational 
activities alongside the Petitioner's other employees. See Family Inc. v. USCIS, 469 F.3d 1313, 
1316 (9th Cir. 2006); Champion World, 940 F.2d 1533. 
(b)(6)
Matter of H-R-E-D-A- , Inc. 
The Petitioner filed Form 1-129, Petition for a Nonimmigrant Worker, on April 26, 2016. The 
petition included a letter from president of (the 
Petitioner's parent company in Hong Kong), who stated: 
[The Beneficiary's] duties presently are to set up the new office and get everything 
under way for the new office. His duties include but [are] not limited to: 1) increase 
management's effectiveness by recruiting, selecting, orienting , training, coaching , 
counseling , and disciplining managers; communicating values, strategies , and 
objectives; assigning accountabilities; planning, monitoring , and appraising job 
results; developing incentives; developing a climate for offering information and 
opinions; providing educational opportunities. 2) Develops strategic plan by studying 
technological and financial opportunities; presenting assumptions; recommending 
objectives. 3) accomplishes subsidiary objectives by establishing plans, budgets, and 
results measurements; allocating resources ; reviewing progress; making mid-course 
conections. 4) coordinates efforts by establishing procurement , production , 
marketing , field, and technical services policies and practices; coordinating actions 
with corporate staff. 3) [sic] Contributes to team effort by accomplishing related 
results as needed. 
The duties listed do not appear to relate to setting up a new office. Furthermore, the duties are broad 
and general, resembling a template rather than the specific responsibilities of the offered U.S. 
position. Items such as "[ c ]ontributes to team effort by accomplishing related results as needed" 
offer little insight into the actual tasks the Beneficiary would perform in the position. The job 
description refers to procurement, production , and technical services, none of which appears to relate 
to the Petitioner ' s intended real estate development business. 
the Petitioner's vice president, provided a longer job description: 
1. Manage feasibility studies for new projects. Research and compile information 
for presentation to board of parent company. 
2. Supervise the negotiations of good estate deals and make decisions regarding 
the signing of land purchase agreement and attending the closings. 
3. Oversee all aspects of selecting development team, building design, permitting 
and construction. 
4. Assess the physical condition of real estate assets, evaluate current/long term 
financial health, develop financial projections, and make recommendations to 
parent company. 
5. Management of projects at various phases, from project identification through 
design, planning, entitlement, financing, construction, lease-up, and closeout. 
6. Completion of due diligence, market research, demographic studies, and 
competitive analysis. 
7. Underwriting and predevelopment budget and proforma preparation; ongoing 
project financial, cost and budgetary analysis , including the preparation of cash 
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Matter of H-R-E-D-A~. Inc. 
t1ow analysis and monitoring monthly project schedules to determine if projects 
are on schedule and within the approved budget. 
8. Participate in development of the scope of work and financial planning for 
major renovations, possibly including some day to day construction 
management of such projects. 
9. Plan and provide oversight for maJor repair and capital improvements to 
existing real estate assets. 
10. Preparation of pre-development budgets and schedules for proposed projects. 
Tracking and updating budgets and schedules from initial phases including land 
contract negotiation through construction completion and lease-up. 
11. Leadership of project teams consisting of architects, engineers, general 
contractors, property managers, real estate brokers, environmental consultants, 
etc. 
12. Leadership of development meetings through pre-development and 
development stages, including meetings with public and private partners, 
neighborhood groups, design teams, general contractors and public hearings. 
13. Overseeing and preparing accurate project documentation for all phases of 
development, including overall due diligence, budgets, schedules, meeting 
minutes, funding requests, status reports, etc. 
14. Participate in the annual review of the corporation's business/strategic plan. 
Provide input and feedback as appropriate. 
15. Management ofvendor contracts and performance. 
16. Assisting in managing projects under construction to ensure adherence to 
architectural plans and specifications, schedule, and budget. 
17. Assisting in the transition of developments from construction to operations. 
The Petitioner lists the Beneficiary's duties as including both managerial and executive tasks and 
administrative or operational tasks, but does .not quantify the time the Beneficiary would spend on 
these different duties. Also, several elements refer to oversight, assistance, or participation in 
various activities, without identifying specific tasks that these duties might entail. This lack of 
specificity is important because several of the Beneficiary's proposed daily tasks, such as property 
inspection, market research, and preparation of meeting minutes, do not fall under traditional 
managerial or executive duties as defined in the statute. For this reason, we cannot determine 
whether the Beneficiary would primarily perform the duties of a manager or an executive. See IKEA 
US, Inc. v. US. Dept. of Justice, 48 F. Supp. 2d 22, 24 (D.D.C. 1999). The Petitioner's description 
of the Beneficiary's job duties does not establish what proportion of the duties would be managerial 
in nature, and what proportion would be non-managerial. See Republic o.fTranskei v. INS, 923 F.2d 
175, 177 (D.C. Cir. 1991). 
B. Business Plan and Proposed Staffing Levels 
Further, the position description alone is insufficient to establish that a beneficiary's duties would be 
primarily in a managerial or executive capacity, particularly in the case of a new of1ice petition 
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Matter of H-R-E-D-A-, Inc. 
where much is dependent on factors such as a petitioner's business and hiring plans and evidence 
that the business will grow sufficiently to support a beneficiary in the intended managerial or 
executive capacity. A petitioner has the burden to establish that it would realistically develop to the 
point where it would require the beneficiary to perform duties that are primarily managerial or 
executive in nature within 1 year. Accordingly, the totality of the record must be considered in 
analyzing whether the proposed duties are plausible considering a petitioner's anticipated staffing 
levels and stage of development within a 1-year period. The petitioner must describe the nature of 
its business, its proposed organizational structure and financial goals, and submit evidence to show 
that it has the financial ability to remunerate the beneficiary and commence doing business in the 
United States. See 8 C.F.R. § 214.2(1)(3)(v)(C). 
On Form 1-129, under "Current Number of Employees in the United States," the Petitioner stated 
"6." The. initial filing included a letter from counsel, who stated that the Petitioner "plans to employ 
at least 8-10 employees within one year of operation, the company already has 7 employees with one 
manager and three sales [staff] running their business." 
The Petitioner's business plan states, on page 9, that the company "will commence its operations in 
. 2015 with 2 part-time employees and will have 7 employees and maintain this staff level throughout 
the first five years." Page 8 of the business plan indicated that the Beneficiary "will immediately 
look to appoint the remaining 4-:5 members of staff," while page 17 indicated that the Beneficiary 
"will be supported by a team of five (5) additional employees, all of whom will be appointed at the 
commencement of business operations in May 2016." 
The Petitioner has submitted an organizational chart, also reproduced in the business plan, which 
listed seven titles: 
• General Manager/President 
• Legal Counsel (Part Time) 
• Vice General Manager/Vice President 
• Financial Manager 
• Marketing Manager 
• Administrative Assistant 
• Construction Site Manager 
The chart listed a name beside each title, indicating that the Petitioner had already recruited and 
identified individuals to fill those positions, even if their employment had not yet begun. 
Nevertheless, on page 10 of the business plan, the Petitioner stated that the Beneficiary "will look to 
recruit" a construction site manager. The business plan also referred to an unspecified number of 
sales representatives, not shown on the organizational chart. 
The Director issued a request for evidence (RFE), noting apparent inconsistencies in the Petitioner's 
initial statements. The business plan stated that the Petitioner would commence operations with two 
employees, whereas on Form I-129, the Petitioner had stated that it already had six employees. The 
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(b)(6)
Matter of H-R-E-D-A- , Inc. 
Director asked for additional evidence to establish its cun-ent staffing and evidence to show how it 
determined its projected staff size. 
In response, the Petitioner submitted an amended Form 1-129, showing one current employee instead 
of the six previously claimed, along with payroll records and other evidence to support the new 
claim that it had one employee at the time of tiling. The Petitioner al$0 submitted an amended 
business plan, indicating that the Beneficiary had interviewed all candidates for the positions shown 
on the organizational chart, and that the Petitioner intended to hire the workers no later than January 
2017. 
The Director denied the petition, stating that the Petitioner had not explained why it revised the 
number of employees claimed on Form I-129. The Director also noted that the business plan 
contains conflicting information about its initial staffing and when the company will commence 
operations, as described above. 
On appeal, the Petitioner submits affidavits from the Beneficiary and from an 
attorney employed by, counsel 's firm. The affidavits indicate that the Petitioner intends to hire six 
employees, one part-time and five full-time, adding a seventh employee within 5 years. Due to a 
language-based misunderstanding, misunderstood the Petitioner's intention to hire six 
· employees to mean that the Petitioner already had six employees. 
The Petitioner asserts that the discrepancies regarding staffing are easily explained, but "USCIS just 
considered one factor, and only one factor, in concluding that the beneficiary was not employed in a 
primarily managerial capacity." The Petitioner argues that the Director "must consider the duties 
actually performed by the manager in determining . whether the position he is being otTered is 
primarily managerial. " The Director did, however, make a determination about those duties , which 
we will discuss further below. 
The best evidence regarding the Petitioner's staffing as of the filing date consists of the tax and 
payroll documents, which show that the Petitioner never had more than two employees at once 
during the months surrounding the petition's filing date. The assertion that counsel mistook the 
Petitioner's future plans for present staffing is plausible, although we note that the Petitioner 
originally identified seven prospective employees by name . It is not evident why the Petitioner 
would identify the future employees with such specificity if at least one of those hires was said to be 
years in the future. 
We acknowledge that the Petitioner has identified most of the Beneficiary's intended subordinates as 
managers, and the Director did not address their roles in the denial notice, but an adequate 
description of the Beneficiary's intended duties is a separate regulatory requirement that the 
Petitioner cannot satisfy simply by indicating that the Beneficiary will have authority over managers . 
For the reasons discussed above , the position description provided for the Beneficiary was not 
sufficient to establish that he would perform primarily managerial or executive duties within 1 year. 
7 
(b)(6)
Matter of H-R-E-D-A-,ln c. 
There are additional deficiencies in the Petitioner's business plan. The business plan indicates that, 
once fully staffed, the company plans to pay more than $358,000 in salaries per year. (The exact 
figure is higher because the Petitioner did not specify salaries for some positions.) The Petitioner 
has not established that it will be able to pay these salaries. The Petitioner referred to "revenues 
modeled to peak at $8.7 million per annum by the end of [the] fifth year," but the Petitioner has 
documented minimal proposed business activity for the first year. Specifically , the Petitioner has 
provided evidence related to the purchase of a $I50 ,000 vacant lot on which it intends to build a 
single family home. The Petitioner estimates the profit that would follow the sale of the land after 
development, but the Petitioner does not appear to have accounted for the costs of developing the 
land in its first-year projections. These deficiencies call into question the Petitioner's ability to carry 
out its stated hiring plans and whether it would more likely than not support a managerial or 
executive position within I year. 
Based on the deficiencies discussed above, the Petitioner has not established that the Beneficiary 
will be employed in a managerial or executive capacity in the United States. 
III. PHYSICAL PREMISES 
The Director further found that the Petitioner had not established that it had secured sufficient 
physical premises to house the new office. See 8 C.F.R. § 214.2(1)(3)(v)(A). 
The Petitioner's initial submission included a copy of a "Renewal Agreement" with 
executed in October 2015, for a two-person office (number 
beginning February I, 2016. The agreement is a generic one which does not describe the specific 
space provided , for instance by specifying the dimensions or square footage. Photographs of the 
Petitioner ' s office show two desks, but they do not show enough of the room to give a sense of its 
size. 
In the RFE, the Director found that an office for two, as shown in the photographs and described in 
the agreement with cannot accommodate the Petitioner's anticipated staff of up to seven 
employees. 
In response , the Petitioner also submitted a letter attributed to community manager 
for local office, stating 
that the Petitioner "has leased from us a suite . . . [which] is 
expandable and it can hold desks for at least four (4) employees. In addition , we are under 
negotiation for another lease on the same floor of the [sic] similar size.'' The date on the letter, May 
27, 2016, is a month after the petition's filing date. An agreement dated June 10, 20I6, refers to 
office number with space for four; the Petitioner's earliest check to pay for that space dates 
from June I 0, 2016. 
The Petitioner submitted a photograph of an office containing tom desks, but the photograph did not 
show any signage to indicate that the office shown is office which the Petitioner used at the 
time of filing, rather than office the space for tour that the Petitioner secured afterward. The 
8 
(b)(6)
Matter of H-R-E-D-A- , Inc. 
color and pattern of the carpeting in the new photographs do not appear to match those shown in the 
earlier photographs of the two-person offioe. Neither set of photographs showed the entire room, 
and therefore the photographs do not allow us to compare the size of offices and 
As noted above, the Petitioner disavowed its initial claim to have si~ employees at the time of filing, 
but even if the Petitioner had not fully staffed its office at the time of filing, the Petitioner must show 
that it has sufficient space to accommodate its staffing plan. Therefore, the Petitioner must show 
that, at the time of filing, it had secured sufficient accommodations for at least six employees. 
In the denial notice, the Director found that the Petitioner had not shown that it had secured 
sufficient physical premises to accommodate its intended staff as of the petition's filing date. The 
Director acknowledged the June 2016 agreement with but found that this agreement did not 
I 
reflect the situation as of the petition's filing date. The Petitioner must establish eligibility at the 
time of filing the nonimmigrant visa petition and must continue to be eligible for the benefit through 
adjudication. 8 C.F .R. § 103 .2(b )(I). A visa petition may not be approved at a future date after the 
Petitioner or Beneficiary becomes eligible under a new set of facts. See Matter of Michelin Tire 
Corp., 17 I&N Dec. 248,249 (Reg'! Comm 'r 1978). 
in her affidavit, states: 
[W]hile the landlord stated that space was sufficient for four employees, the 
Petitioner [sic], after personally examining the facilities had recounted that six to 
seven employees could be housed, until facilities could be expanded. He further 
stated that he was negotiating for doubling the space. By the time ~ the August 
submission was filed, the additional space had been secured. 
The Beneficiary states: 
Respecting physical space, [I] secured enough space to house six employees. The 
space was originally for two employees, but the landlord felt that four could be 
housed. (See, August Filing, Landlord's letter). On measuring the space, [I] 
concluded six-seven employees could be housed for up to a year until additional 
space was secured. This became moot when the second lease ... was executed. 
The letter attributed to submitted in August 2016 in response to the RFE, raises 
significant questions. The letter repeatedly refers to a "lease," when the actual agreement with 
emphasized that the agreement was not a lease and created no leasehold interest. The 
agreement submitted in response to the RFE specified "the Customer is taking a serviced office 
agreement and not a lease," and implied that had, itself, leased the space from an unidentified 
landlord (stating that the service agreement is subordinate to lease). 
The Petitioner has not shown that six desks fit into office which considers to be an 
office space for two workers. We note that the "Office House Rules" in the record state: ' 
9 
(b)(6)
Matter of H-R-E-D-A- , Inc. 
will ask the Customer to sign and inventory of all accommodation, furniture and equipment the 
·customer is permitted to use." The Petitioner has hot submitted a copy of this inventory, and 
therefore there is no affirmative evidence that the Petitioner ever had six desks in office 
The Petitioner states, on appeal, that its original office space "could be expandable to hold four ( 4) 
people." The record does not state the manner in which the space was "expandable, " and there is no 
indication that the Petitioner had in fact expanded the space at the time it tiled the petition . The 
Petitioner has not provided adequate support for its claim, on appeal , that the company had secured 
sufficient physical premises at the time of filing. We agree with the Director that the Petitioner has 
not met this requirement. 
IV. FOREIGN EMPLOYMENT IN A MANAGERIAL OR EXECUTIVE CAPACITY 
In addition, although not addressed by the Director , the record does not support a finding that the 
Beneficiary worked outside the United States in a managerial or executive capacity for at least I 
continuous year during the 3 years preceding the filing of the petition as required by 8 C.F.R. 
§ 214.2(1)(3)(v)(B). 
On Form I-129, the Petitioner stated that the Beneficiary had served as the "Manager of the Business 
Development and Planning Department" at the foreign company. stated that the Beneficiaty 
"spends 90% of his time in investigating the real estate market in China and around the world. He 
either makes personal trips or listens to his teams regarding new information of sources of real estate 
markets." stated that the Beneficiary did this work with the help of "his two assistants." 
The statements cited above contain few details regarding identifiable managerial tasks, and appear to 
indicate that the Beneficiary spent most of his time collecting information about investment 
opportunities. The Petitioner did not explain how this activity meets the elements of the definition of 
managerial capacity. 
also made repeated references to the Beneficiary's "specialized knowledge." The 
Petitioner must establish that the Beneficiary's foreign position was in a managerial or executive 
capacity in order to establish his eligibility as an L-1 A manager or executive for a new office. See 
8 C.F.R. § 214.2(1)(3)(v)(B). 
The Petitioner identified four foreign subordinates below the Beneficiruy, without specifying which two 
were "his two assistants." The Petitioner provided inconsistent infotmation about the job titles for three 
of the four subordinates: 
Name Title - organizational chart 
Marketing Analyst 
Research Analyst 
Strategic Planner 
Manager Assistant 
10 
Title - RFE response 
Market Researcher 
Market Researcher 
Market Analyst 
Manager Assistant r 
Matter of H-R-E-D-A-, Inc. 
The job description indicated that the Beneficiary delegated operational functions to subordinates, 
but the Petitioner provided inconsistent information about those subordinates, without first-hand 
documentary evidence that would overcome the discrepancies or clarify their responsibilities. 
Between these inconsistencies and the lack of information to explain how the Beneficiary's duties 
qualify as managerial or executive, the record does not establish that the Beneficiary was employed 
abroad in a qualifying capacity. 
Furthermore, there are discrepancies in the foreign entity's financial and payroll documents. Payroll 
documents from 2015 do not include the Beneficiary's name or the names of three of his four 
claimed subordinates. In addition, the foreign entity's audited financial statement for 2014 do not 
show any salary expenses even though purported payroll records show monthly salary expenses that 
exceed the foreign company's annual sales income. The Petitioner has not adequately documented 
the foreign entity's staffing levels, organizational structure, or the Beneficiary's 1 year of 
employment abroad in a managerial or executive capacity. For this additional reason, the petition 
cannot be approved. 
V. CONCLUSION 
In visa petition proceedings, the burden of proving eligibility for the benefit sought remains with the 
petitioner. Section 291 ofthe Act, 8 U.S.C. § 1361. Here, that burden has not been met. 
ORDER: The appeal is dismissed. 
Cite as Matter of H-R-E-D-A-, Inc., ID# 205581 (AAO Feb. 22, 2017) 
II