The HMG Neighborhood development process takes an enormous amount of time and effort, but is an important part of creating the strong relationships and community expectations that will sustain the HMG Neighborhood in the long run. In a typical process, which could take up to two or three years, the local church ministry leads the development of the HMG Neighborhood. HMG provides facilitation and technical support throughout all phases of the process, which include community formation and visioning, site and project design, and ownership and operations planning.

Community Formation and Visioning
The HMG Neighborhood development process begins with a church or local ministry with a heart and vision for an HMG Neighborhood. This heart and vision leads to the commitment to becoming a Sponsor of the HMG Neighborhoodand to supporting at least 10-12 family or individual households initially interested in living in the HMG Neighborhood when complete. This core group may come from a local church or from a group of local churches. This core group is encouraged to meet and pray together to vision and craft a plan for values of the community. The process allows for each member of the core team to share what God has put in their hearts in terms of the HMG Neighborhood community. Commitment to each other and to the HMG Neighborhood vision is critical.

Site and Project Design
The HMG Neighborhood development process include forming of a separate 501(c)(3) corporation by the Sponsor to lead the develop team and own the project. The Sponsor should appoint 3-5 individuals to lead the development initiative. The Sponsor and HMG Development Services have the option of co-developing the HMG Neighborhood property. In the planning process, cost estimates are created for developing the neighborhood and plans are developed for acquiring the upfront and ongoing resources necessary to build and operate the HMG Neighborhood. The planning process will produce an initial draft of the HMG Neighborhood plan which outlines the vision, purpose and the details of the HMG Neighborhood development process and operations. The HMG Neighborhood development process then identifies potential sites for the neighborhood. Once a site has been identified, the Sponsor often purchases an option on the property, depending on the status of the finance. Once the site is under control, the property typically undertakes a full permit, zoning, utility availability and site planning review by the development team. The team selects basic design layouts for the individual units and the common spaces. The financing plan is simultaneously developed and is used to solicit and secure commitments from construction and permanent debt lenders, equity investors, home buyers, and public soft debt and operating subsidies. The sources of financing may include especially created lending and equity investment vehicles and other third party lenders. Homeowner purchasers usually are required to provide their own down payment and other financing. Once a final construction price is determined, the final financing for construction is committed and funded.

Ownership Structure and Operations Planning
The HMG Neighborhood development process includes structuring the real estate as a condominium entity. As in a standard condominium structure, each HMG Neighborhood home is a separate condominium unit and the land and common space is shared prorata based on the total number of condominium units. Other private spaces, such as storage or carports, may be included in the separate condominium units and leased to residents separately. The Sponsor usually owns and controls the rental homes through a separate entity. This separate ownership entity may own up to half of the condominium units and then lease these homes to individuals at affordable and market rates. The HMG Neighborhood utilizes public and private financing and subsidies to finance the affordable rental and homeownership homes. Each HMG Neighborhood homeowner owns and controls each of the homeownership homes. As the homeownership homes are sold by the homeowners, the HMG Neighborhood may provide for a right of first refusal to purchase the homeownership units. The affordable ownership homes would have a requirement for the homes to be sold back to the HMG Neighborhood at a sale price limited to an equitable formula price that takes into account the local real estate market value appreciation/depreciation.