The answer I received mostly stated what I already knew. Please respond only to the specific questions. I already know that Taxpayer will likely have to report a capital gain of $$8$ million. Questions $1$b and $2$ have been answered, so I have removed them. I still need answers to questions $1$a and $3.$

My specific questions are:

$1.$ Section $1031$requires identifying replacement property within $45$ days for tax$-$deferred exchange. If exchange fell through $10$ days prior $180$ day limit$,$

a$.$ Would Taxpayer be returned their original building? If so$,$ would it keep its original basis?

$3.$ According to CCH$,$ "The business$-$use and investment purposes are interchangeable, so investment property can be exchanged for business$-$use property, and vice versa." If original exchange contract fell through, could Taxpayer purchase investment property as like exchange for headquarters building?

Shortened scenario below:

Taxpayer wants to change its headquarters. Current building is owned outright. Taxpayer has identified some suitable properties. A single$-$story building on a large lot & a two building complex, with retail & residential rental property.

Both new properties have a fair value slightly higher than current building. Both sellers appear interested in an exchange where Taxpayer's property would be exchanged for one of the other properties.

After discussions, Taxpayer decided to exchange its existing property for the retail & residential complex. You assisted in structuring exchange. Both parties conveyed property to a middleman. The middleman agreement required Taxpayer sell its property to middleman & formally identify which new property it intended to acquire within $45$ days of initial closing. The identified property would also be sold to middleman then transferred to Taxpayer within $180$ days.

Transaction did not go as planned. Taxpayer transferred its property to middleman, received $$10$mil FMV in cash. Taxpayer formally identified its intent to buy the retail & residential complex. One week before $180$ days were up$,$ the property$$s seller backed out. Taxpayer is certain it will not be able to identify & cause transfer of another suitable property within time limit$.$

Taxpayer's basis in current building is $$2$mil. Taxpayer is concerned it will need to report an $$8$mil gain. Taxpayer asked your advice. How would you advise? How should Taxpayer proceed? Any action or planning Taxpayer could$/$should do$?$ Prepare a memo with issues, assumptions, conclusions, reasoning, and authority.