Pivoting out of a 1031 exchange

[Olga Nadal]

Here is the situation, we identified 3 properties for our 1031 with the idea of buying two and having a back up. We ended up buying one house to turn into a vacation rental and the two other options were one- a stand alone commercial building and two- a ground floor unit (currently occupied with a tenant for another 3 years) of a building that is in the process of being turned into condos. 

The first commercial option was sold to someone else and we are in escrow for the condo one but ready to fold that deal due to several reasons that have made us lose faith that this is a good investment. Now, we are out of the identification window so we are left with either trying to save the current deal (which involves accepting terms that weren't initially part of the deal or call it quits and pay the capital tax gains on half of the proceeds from the sale.

Are there any other options that would be worth considering? And if it were you, what would you do? Happy to answer more questions if the scenario is not clear. Thanks in advance ;)