Scenario Comparison at a Glance
| Scenario | LP IRR Impact | Cost to BBM | Timeline | Risk Level |
|---|---|---|---|---|
| A. Walk Terminate before Apr 29 |
N/A — Preserve capital | $0 additional | Done by Apr 29 | Low |
| B. Extend + Renegotiate TMA Send notice, fight the TMA |
22–24% (if TMA reduced) | $10K + legal fees | 60 more days | Medium |
| C. Extend + Accept TMA Send notice, absorb the cost |
~17–20% (if $400K+ absorbed) | $10K + $400K+ | 60 more days | High |
Scenario A
A
Walk — Terminate Before April 29
Preserve capital · Zero additional cost · Move on to better deals
LP IRR
N/A
Capital preserved. $55K earnest money returned (minus $5K independent consideration). No further exposure.
Walk Triggers — Act if ANY of these are true:
Bobak confirms total traffic mitigation cost (TIA + TMA) > $500K — LP IRR drops below 20% floor
Seller/Josh Brown refuses to renegotiate purchase price given TMA surprise
TMA cannot be renegotiated with Austin Transportation Dept. before close
Title objections (Heather Puckette) reveal additional material encumbrances beyond TMA/TIA
2-driveway constraint makes CP4 concept plan unworkable for QSR tenants
Pros
$55K EM returned (net of $5K non-refundable)
Zero additional carry or legal costs
Team bandwidth freed for FM 812 and Kohlenberg
Opportunity cost argument: better deals available
BBM-seller relationship preserved for future approach
Cons
Lose strategic SW Austin position
NRP Group relationship/adjacency advantage lost
M/I Homes rooftop demand captured by another developer
Difficult to re-acquire at $6.5M if fundamentals improve
Sunk costs: legal, engineering, Mahoney fee
Scenario B
B
Extend + Renegotiate TMA
Send extension notice · Fight for price concession + TMA fix · Preferred path if Mahoney call is positive
LP IRR
22–24%
If TMA obligation reduced to $100–200K range through renegotiation, IRR holds above 22%. If purchase price reduced by $200K+ to offset TMA, IRR holds at 24%+.
Extend + Renegotiate Triggers — Choose this path if ALL of these are true:
Bobak confirms TIA improvements are manageable (<$200K) and driveway configuration works
Kutak Rock has leverage to compel seller/Josh Brown to credit TMA cost at closing
Austin Transportation Dept. indicates TMA can be modified/reassigned before close
Mahoney confirms CP4 concept is viable with 2-driveway constraint
60-day extension is sufficient to negotiate the TMA and confirm engineering
Pros
Keeps deal alive without absorbing full TMA cost
Creates leverage to renegotiate purchase price
60 more days to fully clear due diligence
Preserves NRP adjacency and corridor position
$10K fee credited to purchase price at closing
Cons
$10K extension fee non-refundable if walk later
Legal/negotiation cost in the 60-day window
Seller may refuse to concede on TMA
City may not agree to TMA modification
Team resources stretched vs. other deals
Scenario C
C
Extend + Accept TMA as-is
Not recommended unless engineering confirms development viability is strong
LP IRR
17–20%
Absorbing $400K+ TMA reduces LP IRR to 17–20% range. Below the 20% alert threshold. Only justified if exit values are materially higher than base case.
Accept TMA Triggers — Only consider if:
Exit values (individual pad prices) are confirmed materially higher than base case — offsetting the TMA burden
Strong NRP Group letter of intent for MF tract at above-base pricing
QSR tenants provide committed LOIs at pad pricing above model assumptions
Pros
No further negotiations — simpler path to close
Preserves deal if corridor value is higher
NRP adjacency value could offset TMA cost
Cons
LP IRR below 20% alert threshold
Sets bad precedent for undisclosed encumbrances
$400K+ cash out of pocket before pad sales
LP investors may not accept sub-20% return
Additional TIA costs could stack further
Pre-Mahoney Meeting Checklist
Items to have answered BEFORE or DURING the Mahoney meeting to make the extension decision:
Confirm Bobak's cost estimate for full TIA/TMA burden
Call Bobak before or same day as Mahoney. Get the number. This is the decision-making input.
Ask Mahoney: Is CP4 viable with only 2 driveways (Thaxton @600ft + Slaughter)?
Mahoney Engineering is the engineer of record. They need to confirm or redline CP4 based on access constraints.
Ask Mahoney: What does the TMA actually require us to build/pay?
Daniel Mahoney or Tyler Boykin may have reviewed the TMA already. Get their read on the specific mitigation scope.
Check with Heather Puckette (Kutak Rock): Any leverage on seller via title objection letter?
If TMA is an undisclosed material encumbrance, the title objection process may create a concession opportunity.
Craig Biggar alignment: Walk vs. Extend — what does Craig recommend after Mahoney meeting?
Craig is the BBM manager. His recommendation carries significant weight. Set up a quick call after Mahoney.
Can NRP Group be informally sounded out on MF land pricing before April 29?
An informal conversation with Max Whipple at NRP about Thaxton MF land could provide upside evidence that supports Scenario B.
Confirm extension notice format with Heather Puckette — written notice to pboghosian@boghosianraisin.com
PSA requires written notice (email consented). Notice to Philip Boghosian, Trustee. $10K fee to Seller (not title) within 3 days.