Week 1: Becoming a Small Developer

September 5, 2023, kicked off Day 1 of the Incremental Development Alliance's (IncDev) Small Developer Bootcamp! It opened with a burst of energy, curiosity, and a shared commitment to building stronger neighborhoods through small-scale development. Participants arrived with questions, lived experience, and a hunger for clarity on the financial, legal, and strategic foundations of becoming a developer.

What unfolded was a deeply practical, highly interactive session that helped demystify the early steps of the development journey, especially for those working in a legacy city with historically disinvested neighborhoods.

Here’s what participants learned.

Residential vs. Commercial Mortgages

One of the first big questions of the day came from participants trying to understand the difference between residential and commercial mortgages, and why a developer might choose one over the other. The group learned:

• Residential mortgages are typically used for 1–4 unit properties.

• Commercial mortgages apply to 5+ units or mixed-use buildings.

• Commercial loans often come with:

  • Higher interest rates

  • Shorter terms

  • More scrutiny of the project’s income potential

Participants also learned that FHA and VA loans can sometimes be used for mixed-use properties, as long as the residential portion meets certain thresholds. This opened up new possibilities for first-time developers who may qualify for these programs.

Structuring Your Business: LLCs, Holdings, and Liability

A major point of confusion for many new developers is how to structure their entities. Day 1 cleared that up. Participants learned:

• Each property or project should have its own LLC to isolate risk.

• A holding company can sit above multiple project LLCs, creating additional separation between the developer and the assets.

• There is no single “right” structure, only structures that protect you from cross‑liability and align with your long‑term goals.

This was a lightbulb moment for many in the room.

Development in Cash Markets: The Gary Reality

Gary’s unique market conditions were front and center in the conversation. Participants explored how redlining and decades of disinvestment have shaped today’s appraisal challenges, why traditional bank financing often doesn’t work in low‑appraisal environments, and the importance of “farming”—starting with small, manageable projects that build value over time.

Participants also learned how to think creatively about nontraditional financing, including:

• Credit unions

• CDFIs

• Local banks

• Mission-driven lenders

• Gap funding sources

Participants shared real-world examples, including lenders requiring crime reduction plans as a condition of financing, which illustrates how risk is perceived differently in legacy cities like Gary.

How to Get Rental Comps (When They’re Hard to Find)

Sales comps are often easy to pull. Rental comps? Not so much. Participants were encouraged to work with a realtor for the most accurate MLS data, and to supplement that research with Zillow, Apartments.com, developer websites, and local property management listings.

The key insight: Look at actual rents being achieved, not just listing prices. Rents are more flexible and context-dependent than sales prices, so developers must triangulate from multiple sources.

Negotiating With Landowners and Investors

Participants asked how to structure returns for landowners or silent partners.

The takeaway? There is no fixed formula. However, returns should at least match or beat the federal prime rate or a typical savings account. Because everything is negotiable, the goal is to create shared upside without overcommitting.

This reinforced a core theme of the bootcamp: small development is as much about relationships as it is about numbers.

Choosing the Right Lending Partner

Participants compared experiences with Big 5 banks, local banks, credit unions, CDFIs, and specialized mission-driven lenders. The consensus was that local banks and credit unions are often more aligned with neighborhood-scale development, and  CDFIs like Intend Indiana, IFF, and Cinnaire can be strong partners for gap funding or mission-driven projects. The key is to build relationships early, before you need financing.

Participants from Gary shared that Everwise Credit Union is already investing in similar projects in Indianapolis and South Bend, making it a promising partner for Northwest Indiana.

Working With Nonprofit Developers

Participants also explored how nonprofit developers fit into the ecosystem. Key insights:

• Nonprofits can be strong partners for mission-driven or affordable housing projects.

• They often have access to funding streams that private developers do not.

• Collaboration can help spread risk and expand opportunities for local small businesses.

A Shared Sense of Momentum

By the end of Day 1, the chat was full of encouragement, gratitude, and a sense of collective purpose. Participants expressed:

• Relief at finally understanding concepts that once felt intimidating

• Excitement about new financing pathways

• Confidence in structuring their first (or next) project

• A renewed belief that small-scale development is possible, even in challenging markets

As one participant put it,  “Absolutely well worth it!! I am FULL!”

Meet the Instructors

Marques King, Detroit, Michigan

Architect, Small‑Scale Developer, Urban Designer, and National Instructor with the Incremental Development Alliance. Marques is known for his work helping cities modernize zoning, teaching small developers how to build feasible projects, and designing Detroit’s Small‑Lot Infill Ordinance. He brings deep experience in missing‑middle housing, infill development, and neighborhood‑scale revitalization.

Tiffany Brown, Tulsa, Oklahoma

Small‑scale developer, contractor, and housing practitioner who works closely with the Incremental Development Alliance. Tiffany often teaches about financing, construction realities, lender expectations, and how to evaluate rental markets. She brings hands‑on experience from both the construction and development sides.

While not primary instructors, a few experienced practitioners contributed context or resources, adding depth to zoning, policy, and feasibility discussions:

• Allison Quinlan, Fayetteville, Arkansas

Architect and small‑scale developer known for missing middle housing and zoning reform work.

• Ali Ankudowich, Tallahassee, Florida

Planner and zoning reform specialist with the Florida Housing Coalition.

Looking Ahead

Day 1 laid the foundation: financing, entity structure, comps, lenders, and the realities of building in disinvested markets. Participants left with clearer strategies, stronger networks, and a deeper understanding of how to move from idea to action. Wednesday's office hours will explore the application of these principles on real-life projects

Week 2 will build on the momentum, diving deeper into project feasibility, design, and the practical steps that turn small projects into neighborhood-changing investments.

This training is made possible by a grant from the Legacy Foundation's John S. and James L. Knight Donor Advised Fund.