This is a tough situation, but you’re gaining valuable experience that will serve you well in future deals.

It will make the loans more valuable if you ever decide to sell them and decreases the chances of default. 

Are you in an area where land is very valuable leaving you with less to depreciate?

Either way you'll learn valuable lessons and gather up experience for your investor toolbelt.

While we focused on his market for ADUs he did share a lot of valuable information that is transferrable to any market.

Through this journey, I’ve built strong relationships and developed valuable expertise in:Researching micromarkets and identifying comparables, potencial Accurately estimating construction or remodeling costs.Securing fast and reliable financing through partnerships with two top hard money lenders in Texas, offering competitive rates.I’m on this platform to connect with capital partners who are seeking an annual ROI of 12%-15%.

I find my time is more valuable than doing taxes for a few days.

Quote from @Account Closed: For someone rebuilding their real estate business and looking to transition into larger multifamily deals, what’s the most effective way to position yourself as a valuable partner in syndications—especially when capital is limited but market knowledge, deal-finding ability, and local expertise are strengths?

There is the tactical "act" of underwriting, then there is the much more valuable "art" of underwriting.The act can easily be taught.  

It sounds like you navigated the challenges well and gained valuable lessons for your next venture.