1031 exchange question

[Patrick Flanagan]

I’m in the equity zone on my 4 plex to do a 1031 exchange and use that equity to buy a smaller apartment building. 

I have a basic understanding of how the process works. My question is do I need to use all of the equity towards the down payment of the property, to avoid capital gains tax? 

Or could you set some of the money aside to do some renovations to the property?

thanks,

Pat