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The green and gold hills of the 530-acre Campstone property in Huachuca City ripple into the distance, surrounded by mountains and few signs of civilization other than an occasional plane from nearby Fort Huachuca.

The owners, developers Michael Combs and Mark Johnson, want to add about 1,400 homes there — doubling the population of Huachuca City — in a plan that is intended to conserve water, use energy-efficient building methods and maintain the land's natural beauty.

"We'll keep the javelinas and the coyotes happy, too," Johnson said as he sat in the nearby Picnic Basket Cafe along Arizona 90. "As long as we do it right, it's good for everybody."

But the plan has hit a roadblock. The lender, Pennsylvania-based Ambit Funding, sued the developers last spring and started to foreclose on the property.

Combs and Johnson said they worked out an extension with Ambit, a private investment group, but the lender rushed to call in the loan. They said they suspect Ambit is more interested in taking possession of their land than in getting back its principal.

Thomas Daniels, general counsel for Ambit, said the loan simply came due and needed to be repaid.

"There's nothing we would like more than to see them succeed with their development," Daniels said.

Combs and Johnson put their development companies into Chapter 11 bankruptcy last week to buy time to negotiate with Ambit or find other financing. Along with $11 million in financing from Ambit, the developers have about $3 million to $4 million in retirement funds for themselves and from friends and family members invested in the project, said their bankruptcy attorney, Eric Slocum Sparks.

Sparks said he was impressed by the project. He referred the developers to a consultant, Jack Neubeck, at The Planning Center for help in finding funding or another partner.

Neubeck said he also was pleased by what he learned about the developers' plans and is hopeful they can pull it off.

"They were really trying to do the right thing," Neubeck said. "That's the thing that really did capture my attention on this. It's just bad timing."

Meeting over tae kwon do

Originally from Branson, Mo., Combs first visited Sierra Vista when he was 10 by tagging along with his father, a trucker who was delivering tanks to the military base.

"When I saw this area, I said, "This is all right with me,' " Combs said. Now 44, Combs moved to Sierra Vista in 1996 and sold mobile homes.

Johnson, an engineer, came to Tucson in 2001 and became interested in environmental building practices. He met Combs in a Sierra Vista high school gymnasium during their children's tae kwon do competition.

"We sat there and talked for three or four hours," Combs said. The two immediately started working on small projects together. Both thought they'd found the perfect project when they landed the Campstone property.

Hilltop housing

Combs and Johnson own the largest section of Campstone. About 200 additional acres are owned by other investors who are planning about 600 houses, the developers said.

Overall, the development would be designed to work with the natural environment by clustering homes on top of hills and leaving the washes and valleys as open space, Johnson said. Homes would be energy-efficient and designed with rainwater-collection mechanisms and other water-conservation elements, he said.

The developers said they want to build a variety of types of housing, including smaller patio-style homes intended to appeal to retirees, and some homes for military families. Home prices would start around $179,000.

Although the property is zoned for up to nine houses on each acre, Johnson and Combs have agreed to a density of 2.6 homes per acre.

"The overall project is something that I think in the long run will be extremely beneficial for the town," said David Perry, a Huachuca City councilman.

Some residents were concerned about the project initially, he said, but "once they were given the facts, everyone that I've talked to has been very positive about it."

Future uncertainties

But at least one important Huachuca City resident is less enthusiastic. Mayor George Nerhan said the market already is in a slump, and a new development wouldn't make sense.

"It's the wrong time," he said.

The credit crunch could make salvaging the plan difficult, said Neubeck, the planning consultant.

It's "very, very hard to get financing right now," he said. "The traditional banks, right now they won't do raw land at all. You need to have so much liquidity that it's pretty impractical."

But Combs and Johnson said the military base has partially insulated the area from the housing downturn felt throughout the rest of the state.

Single-family-home sales in Cochise County were down about 15 percent in May from the same month in 2007, according to the Southeast Arizona Association of Realtors. Meanwhile, sales in Tucson dropped about 28 percent in May from the same month a year ago, according to the Tucson Association of Realtors Multiple Listing Service.

The retiree market is still strong, said Carole Vaughn, a Huachuca City real estate agent and Multiple Listing Service director of the Southeast Arizona Realtors. She added that there would likely be strong demand for energy-efficient homes.

Along with new homes, Combs and Johnson have plans for commercial development on other property, such as a grocery store, which they believe is needed in Huachuca City.

"If we didn't believe so hard in this, we could have just walked away from this," Combs said.