Even at a weight of 235 - 240 and averaging about 2500 to 2700 calories a day, I still wasn't losing fat. Everybody is different (and I am 40 years old), but even with an average caloric deficit of about 800 - 1000 calories a day I wasn't getting results.
Just for your reference at 40 yrs and 240lbs
Your Basal (basic resting life support) Metabolic rate is about 2000 cal per day
Add in an moderate active to active lifestyle it would be about 2,700 to 3,000 total.
So your average of 2500-2700 was not very far below your requirements for break even, if at all. Certianly not 1,000 below.
Now you are averaging about 1,800 per day which would be about 1,000 per day or about 7,000 per week.
At 3,500 per pound 7,000 a week would be about 2 lbs per week which is almost exactly what you did. A little fast, but not too bad for a short period. Extend this for several more weeks without a break and I'll bet you see more LBM go away.
There are many calorie requirement calculators on the internet that let you plug in your personal info.