Tommy DobczykOpportunity Zone Advisor, OZ Wizard · Director of Development | Certified Opportunity Zone Advisor

Deal Fell Apart: Why 40 Units, $17M Investment Failed! #shorts

30 May 2026 · 1 min

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1:01

Tommy Dobczyk breaks down why a 40-unit mixed-use project fell apart twice. CRG spent $2 million and walked away. Flaco entered escrow for $15 million but bailed when construction costs and rent projections didn't work. The conditional entitlement made the build too expensive and risky.

Chapters

Are you in the deal room? Diligence report was entitlement was conditional, so— and not at today's value. The real value is not on that today, right? Yeah. And so the original plan was massive plan, 40 units, 5 to 6 story product, structured parking, high density, mixed use. So keep going down. So translation was an expensive build, high risk, not viable in current market as proven by CRG and Fitch and Walker. It says this has already failed twice. From your combination of due diligence, CRG spent $2 million and walked. Flaco was in escrow for $15 million and walked. Why? Cost plus interest plus rent assumptions didn't work. So, uh, this is in— it's still industrial land today, and it probably could stay that way. Um, the seller's story is not reality, right? So what this means for your negotiation, you are taking all the risk. Seller wants zero risk. And so our position is now very strong.