In $2016,$ your bank financed at $72\%$ Loan to Cost the acquisition and re$-$tenanting lease up of a Class B $105,000$ square foot office building in your community. The asset was constructed in $2001$ and sits on $10$ acres. The loan was underwritten as non$-$recourse but with carve out or $$bad boy$$ guarantees from the three principals. The loan has paid as agreed and the asset has produced significant cash flow well in excess of operational and debt service requirements. The in$-$place debt yield is $14\%$ and DSC is $2\mathrm{.}13$X$.$ You estimate that the principals have received from excess cash flow distributions approximating $$2$MM beyond their original $$5\mathrm{.}1$MM equity investment.

The project is $100\%$ leased today to three tenants. The sponsor has just informed you that one tenant is going to downsize, and the other two tenants have given notice of their intent to not renew their leases that expire this year. At this time, the building will be $40\%$ occupied. After unsuccessful attempts to refinance the asset, the borrower estimates it will take another $$5$MM to re$-$tenant space and an additional $$1$MM for capital improvements. The sponsors $($who provided only carve out guarantees and no personal recourse$)$ met with you recently to inform you that unless they receive a substantial discounted payoff, they were planning to give you the keys to the building and walk away.

The balance on your loan today is $$10\mathrm{.}3$MM$.$ A recent appraisal indicated an $$as is$$ value of $$7\mathrm{.}4$MM and a $6-$month disposition value of $$5\mathrm{.}2$MM$.$

Identify at least three least cost resolution strategies?