business plan prospective homeowners

8/12/2019 Business Plan Prospective Homeowners

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Prospective Homeowners AssociationOrganizational Synopsis

Homes for the Rest of Us

Non-subsidized, entrepreneurially-developed, fair and balanced

between the classes, as they are built for affordability

Abbreviated !siness S!mmary"his paper is designed to show in #!ic$ format what we stand for% what we believe

it will ta$e to reach% and what we are doing to accomplish o!r goals&

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O!tline of Organization

"hree Separate *orporationsOne is for+profit% the other two are non+profit

One ,on+profit is called Prospective Homeowners Association -PHA. PHA will operate as a non+profit )/'-c. -0. p!blic charity% designed for the 1oint and several

p!rposes of2

3evelopment of Affordable(Attainable Ho!sing% and

Association of landless individ!als who will p!rchase as a b!yers cl!b% and own land

cooperatively as a *ondomini!m Association 4 homes in 1oint+ownership with PHA+Real 5state 6nvestment 4 7anagement *o&% with shares of e#!ity based !pon theirincome% -possibly with shares in HR*A.

5conomic 3evelopment "hin$ "an$ for the 5conomic Stim!lation and 3evelopment ofthe Santa arbara *o!nty 5conomy

6t will maintain Charitable Remainder Trust-s.% and a *omm!nity 8and "r!st

The Other Non-profit (Un-named)

)/'-c.-9. Private non+profit% for the p!rpose of lobbying and advocating for affordableho!sing&

For-profit (Un-named)

*alifornia *+*orp&% P!blic company with shares% for the p!rpose of receiving investmentsand investing those monies in affordable ho!sing for the low+income and middle+income

residents of Santa arbara *o!nty&

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S!mmary of ;oals of "wo of o!r Organizations

*reate at least '%/// starter homes

ithin the years ://?+://@

PHA will *o+invest with !yers

Hold o!r own 7ortgage Paper% to Receive 8ong+term 6ncome

ased on pre+fabricated materials

!ild the following $inds of b!ildings on p!rchased property

o ;ranny


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7embership Platform

O!r association stands for the constr!ctive and prod!ctive !se of land&

*omm!nities and neighborhoods cannot thrive witho!t varietyC "raffic 1ams

and poll!tion are ca!sed from the lac$ of good planning and lac$ of 7iBed Use

neighborhoods&

"he e#!itable prod!ction and management of homes for all income levels&

>e demand the oard of S!pervisors attach a >indfall Profit "aB to all sales

of new or !sed homes that were 1ac$ed+!p in price d!e to the 6n+lie! fee&

Habitat enhancement and species maintenance% as well as saving water from

eBcess !se&

U*S needs to be allowed develop its own ho!sing for st!dents and teachers

on its camp!s gro!nds&

>e call on the *ities% *o!nty% State% and


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6ncome *ategories 4 Pro1ects

"he non+profit company will operate as a typical p!blic charity% setting !p tr!sts%applying for and receiving grants% cash donations% etc& !t it will also operate Social5nterprises% which are income+generating b!siness entities% aligned with the mission&

Non-Profit Corp. For-Profit Corp.*haritable Remainder "r!st-s. 8and 4 !ilding 3evelopment

*omm!nity 8and "r!st 7ortgage *ompany

;rants 4 *ash 3onations 6nvestment *ompany

Operate Social 5nterprises Power Prod!ction 4 7anagement

5conomic 3evelopment "hin$+tan$ 5conomic 3evelopment an$

Co-operative Business Social nterprises!

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3evelopment Plans 4 "ime 8ines

6nitial 3evelopment Phase>e will prefer to develop !sing pre+fabricated materials% by placing factory+b!ilt% new townhomes onto land after either by tearing down or moving eBisting str!ct!res on land was already

improved& >e will do this for a co!ple of reasons2'& A ban$ will not loan on !nimproved land&:& "he land with older str!ct!res may be worth less than land witho!t str!ct!res% or land with

newer str!ct!res that may have room for additional b!ildings&0& >e will follow this plan !nless the owner of the land% or perhaps a m!nicipality offers !s

land that we don=t need to p!rchase to move b!ildings onto it for sale?& >e may negotiate the prod!ction of str!ct!res !pon the land% by contracting with the land

owner to share in the profit of the sale of the property&Second 3evelopment PhaseAfter we get o!r b!siness gro!nded and we=re moving forward% we will b!y !nimproved land

and p!t new str!ct!res on itC beca!se by this point in time% we will have cash for earnest money%or down payments to land owners who do not need to be paid in f!ll for land at the time they sellit to !s&"hird 3evelopment Phase>e will b!y larger tracts of land% perhaps in Santa 7aria% or the *!yama alley where we co!ldb!ild a comm!nity of homes& However o!r tract will be laid o!t different than the Roman ;ridstyle& 6t will be designed !pon the 5!ropean village style&e will b!y parcels on which eBist already standing apartment b!ildings which we can convert

into condomini!ms and offer eBisting tenants the opport!nity to lease with an option to b!y&e will b!y parcels which we can b!ild new apartment b!ildings on it% and lease with the optionto b!y% !ntil all !nits are sold& >e may even b!y land and b!ild new apartment b!ildings on it%for the p!rpose of renting fair+val!e apartments o!t& >e may negotiate with homeowners to raisetheir homes !p one level and b!ild a new gro!nd floor level for rent or sale -;iving the owner :/years to pay off the improvement% while creating a condo sit!ation for the new first floor owner.%commercial b!ilding or shopping center owners to add homeowner+occ!pied !nits on the roofsof their commercial(ind!strial(retail centers&

6ncidentallyAll new str!ct!res we place on improved land will be either m!lti+family or single+family%depending !pon the size of the parcel& 6deally% we will place the maBim!m n!mber allowable onthe parcel% to maBimize the lot=s potential in sales dollars and amo!nt of living space& >e mayrelocate eBisting b!ildings% either on another part of the same parcel% or off the parcel entirely&>e may swap land we obtain for other land that is contig!o!s to land weDd li$e to develop into alarger overall parcel& >e may also b!ild or place prefabricated garage-s. on the property% ifre#!ired by reg!lation or the needs of the new b!yer-s.& >e may co+locate commercial b!ildingson the properties where zoned for them% where m!lti+!se properties may be appropriate +depending on the condition of each parcel&

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7ember Profile O!tline>e may create a point system at some date% which allows for the following types of membersto receive greater priority for obtaining a home& or$ers2 or$ers% "ransit >or$ers 4 "eachers

Phase "wo

Hospitality >or$ers2 Hotel Staff% Resta!rant >or$ers%

Retail *ler$s% Small !siness Owners

Phase "hree

*harity Staff% or$ers% *hildren of Older Ad!lts%

Seniors% 3isabled% eterans

Phase


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7ember Responsibilities% enefits% 3!es 8evels4 Application for 7embership

The Prospective omeowners !ffordable"!ttainable ousin# $nvestment %und

will be based on the initial membership drive, sales of life policies, donation and down payments

e have m!ltiple classes of membership% incl!ding2 Angel% >or$ing 4 S!pporter

"n#els are individ!als who are donors and afford to contrib!te on a large basis for "he Pro1ect&

Supporters can be 6nvestors 4 Home !yers% or those who 1!st want to receive the newsletter&

$ome Bu%ers may also be 6nvestors% as can >or$ing 7embers&

&or'in# emers are willing to perform wor$% as well as s!pport the goals financially%

incl!ding2o Attend p!blic meetings 4 for!ms% learn% participate% add val!e% listen 4 advocate for

organization&o >rite% call or meet elected officials 4 establish o!r interests in their minds and agendas&

o Attend membership meetings 4 perform f!nctions on wor$ committees

o Sit on this PHA=s board of directors% raise f!nds 4 otherwise networ$ in comm!nity&

o Register to #!alify for homeownership thro!gh o!r processes -"3.&

o 5nlist new members and receive red!ction in membership fees&

o Pay d!es and contrib!te generally to the organizationDs growth&

o Have opport!nity to invest in real estate at different commitment levels

&or'in# emer *Bron+e,

-,ote2 >or$ing 7ember fee incl!descredit for Homeb!yerDs ann!al fee% sincea >or$ing 7ember will also be aHomeb!yer.&

G':) initiation fee 4 G:/ monthly -G:?/ ea& p(ann!m. -G:/rebate for each additional member signed !p by referral& Onemonth=s d!es credit is ded!cted from the member=s monthlyd!es.&

Silver Contriutor GE)(monthly% after G':) 6nitiation e have not yet incorporated nor filed for taB+eBempt stat!s% so there is no g!arantee

that these membership fees will be taB+ded!ctible& >e are doing the paperwor$ to start the process now&-7embership does not g!arantee a home for each member.&

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Affordable(Attainable Ho!sing6nvestment(3evelopment *o+op

entrepreneurial solutions to difficult issues!

Where will this fund (to purchase land, and develop it, by placingquality homes on a well-designed community), come from?

The 2and purchase escro/ co-op fund comes from that which we will create each time

we find land to hold the receipt of down payments from b!yers of homes&o "his is a common method of pre+ban$ financing to show developers can pay the

ban$ for the loan.& "he way it will wor$ is not told in simple terms% b!t can beallegorically told by the phrase


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Santa Barbara County Prospective HomeownersProject Round A - Plannin ! Fund-raisin

Below here is an example of a pool of money we would have if prospective home buyers put their potentialdown payments up front to help the organiation purchase land and begin planning, design ! developing"

#his would be done in phases, over a period of time and we might do one or more of three things to raisethe total funds for building$ borrow (but then there would be interest on the loans we would have to pay

bac%, which would cut into our net), receive investments and donors"

&owever, mortgage payments at ' interest would pay bac% investors, as would eventual resales of afraction of the homes at mar%et rates for profit which would be reinvested into the plans and development

of more homes"

buyers homeprice * down

#otal +ownayments #otal ales .inus

/+owns/

#otal 0ncome1 2inancedover 3* years

4* 54,*** 5,4** 354,*** 3,354,***

34* 64,*** 6,4** 7,354,*** 38,354,***64* 54,*** 5,4** 7,354,*** 38,354,***

64* 64*,*** 64,*** ',64*,*** 4',64*,***

** 3**,*** 3*,*** 3,***,*** 65,***,***

'%/// "otals 1,354,*** '4,354,***

#otal ales including down payments '@0%E)/%///#otal 2irst-buyer ales ! 2inancing ayments over 3*

years (+oesn9t include re-sales:, if any)

(These figures have been double-checked; as of July 12, 2004)

These figures do not yet include fund-raising from Donors, nor Investors, nor gain in value fromholding the properties over a period of time. (Nor does this show cost of the dividends to be paid

out to investors)4e-sales2 2omehomes may be b!ilt for sale at mar$et or near+mar$et rates% so that we cangenerate additional income to p!rchase more land and b!ild o!t more properties with affordableho!sing that we might have had we not done so&

Additional Sales Cateories

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Production5Sales ScenariosWhen we find a large piece of property and are successful in applying for permits todevelop it - after getting it oned as necessary, for example$ub;ect ample roperty (un%nown) 44 acres


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)rani*ational +ncomes#rom di##erent cateories to #inance action

2und-raising>donations

.emberships

G:'E%///

ales of bumper stic%ersG?%9)/

+own payments from home ,*** buyers(escrow fund development)

G'@%0E)%///

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>hat >e ,eed to 3o

'& >or$ing *ommittees:& 6dentify Reso!rces2

a& 8and

b& 3onorsc& Start !p

i& onding and paying for b!ilding transportation to b!ilding siteCcontingency f!nd for home problems% s!ch as crac$ed walls !pon delivery&

ii& 6ns!ranceiii& ridge between land(b!ilding p!rchase 4 saleiv& *ost of b!ilding roads% fo!ndations% driveways% !tilitiesv& *ost of providing par$s% p!blic gardens 4 s#!ares% social centers% day care

centers&vi& Pre+development fees by the city2 permits(waivers% etc&

vii& O45 6ns!rance for the both boards of directors

viii& Stipend for the corporate boardd& Officers for both corporationse& 6ncorporate two b!sinessesf& Hire cons!ltants

i& Architect!ral design of comm!nity and lot layo!tsii& S!rveyors for layo!ts of

'& Homes% *ommercial !ildings%

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