Trying to analyse selling of home for purchase of investment property

[Stinson McElhinney]

Hello, looking for guidance on my particular situation.

I have a well done, fully remodelled home in Carlsbad, CA in a very desireable neighborhood.  It was my primary residence before I took an overseas assignment and we love the house and neighborhood.  I owe $1,100,000.  Mortgage (rate is 2.85%), interest, insurance, property management, and hoa is $6500/month. Current rent is $6800, as it was locked in 2 years ago. I think it can raise to $7500-$7800.  I've been "soft offered" $2.7m, which is over current valuations.  We have been considering not returning to CA due to high costs and taxes.  I have another residence in ID that we are planning to move into upon returning from overseas. 

I would like to retire in 10 years and am considering selling the house which could produce about $1.4M after realtor fees, then use that to buy ~3ish rental properties cash in an 1031 exchange so I minimize the tax exposure and start producing monthly cashflow that can provide the basis for a retirement in 10 years.  Thinking to buy cash to simplify closing everything on time, then refi them later to pull some cash out and add some additional rentals. 

Am I thinking through this correctly or missing something significant?  CA has always been a strong realestate market, so should I opt for less cash flow, have the option to live in my house, and potentially better appreciation, or should I move on with generating additional cash flow in a different market?

Appreciate any guidance.  Thank you to the community.