Since the sale of unit 1 was reported on Form 1099-S (to you and the IRS), you will have to report that income on your tax return.
While you may not have received $225K in cash when you sold the property to yourselves, you did receive the value of the property (now titled in your and your husband's name) - that value included the FMV of the land and the cost of any improvements made to the land by the previous owners (i.e. the investment group)
Whether or not this transaction results in taxable gain will depend on the investment group's cost basis in the property, as well as how the reported sales price was allocated to members of the investment group.
Caution- when property changes hands between related parties (i.e. the investment group and you/your husband), the IRS expects that the value of that property is established in an "arms-length" manner. You cannot sell something to yourself for less than what it is worth just to avoid gain (or create a loss). This is a strong temptation when a "principal residence" is involved.
