I would suggest going through @Bob E. thread posts.

Are you prepared to take the stand and testify that (a) you intended to take title to the property which you agreed to purchase, (b) you did not intend to use that contract as a tool for facilitating a sale of real estate of another with the intent of receiving a commission or fee, (c) your intent in dealing with the seller was not to facilitate the sale of his real estate to another, (d) your intent with dealing with the buyer was not to facilitate the sale of the real estate of another to the buyer, (e) that the sale of real estate would have occurred regardless of your contract assignment, (f) that you performed your obligations pursuant to the real estate contract before you assigned it, creating ascertainable rights of ownership, (g) that you did not receive a commission or fee for assigning that contract, (h) that the subject matter of the contract was not real estate, (i) that the assignment of your purchase contract did not facilitate a sale of real estate you did not own for a fee that you collected? 

For a 1 year rehab could the partners set it up as a buy and hold, do a schedule E etc, and try to rent the property out for a high rent.  

@Michael Pease, @Meghan McCallum and @Kenneth E: I used to attend "Country's" Real Estate Investor Meetup in the QC and was surprised by the number of people working there!  

http://www.meetup.com/network20/events/218694262/This is the closest meeting I have found to me and it is also a great meeting I attend. https://www.eventbrite.com/e/north-jersey-real-est...Another meeting I have attended but a bit far.http://www.meetup.com/NJ-Flippers-and-Funders-Meet...

Looking for general thoughts/advice on realistic chances of getting this deal funded through SBA or other loan structure allowing for new independent hotel construction and a high LTV in the range of 80-90%:I am a principal with 20 years of experience running an independent hotel but no development experience although I have the right team in place in terms of Architects/GC's/Engineers/Designers etc and a great location with proven demandSolid performance, track record and high ranking on travel sites for current propertyDeveloping a small 31 room boutique hotel (economy/limited service concept interior corridor) on site of current hotelOlder property in need of full tear down as life span is coming to end (built in 50's)Looking to do a full tear down and rebuild with a total project cost of $3.6mm including EVERYTHING - demo, construction, FF&E, entitlements, permits, impact fees, etc.

You can ask for the schedule E of his tax return, which should verify how much income/expense he is claiming- but if he has more than one property it might be hard to figure out what's what.

I feelww e are so close to the finish line that i dont want to give up.

@Stephen E. - the explanation from the technician makes sense.

@Craig E.