Today in the NYTimes, there is a story on the Ohio Supreme Court's rejection of the taking of homes through eminent domain for private development.
While this is one way to approach the issue, another way would be to make former homeowners share holders in the private development, thus not just entitled to fair compensation from their homes but also a share of the profit. Why does this make sense to me?
If the three pillars of economic assets are land, labor, and capital, by providing their land for use, the homeowners are investing in the success in the development scheme in the same way a bank would be. Like a bank that lends capital to the development, they would expect interest as well as a stake in future profit.
A home is just not judged by its market value, if government can take away one's home, as distinct from you giving it away or just selling it, then the government should view you as an investor in the development like anyone else. It just needs to make sure that you are not responsible if the development fails.