1031 Exchange getting the "boot"

[Tyler Brown]

Hello, we recently completed a sale of our apartment complex for $850,000 that was on a standard commercial loan. We used a 1031 exchange intermediary and then purchased a condo in Florida all cash for $360,000. We were under the impression that we could at least get partial tax deferral even though the purchase price was not as high as our sold asset. The intermediary never said there was any problem, but now our accountant is stating that the 1031 exchange "failed" and will be treated as a normal sale. Is there truly no way to get partial tax deferral? If not, is this something the intermediary should have warned us about and should we ask for a refund from them?