721 exchange with seller financing

[Kevin Eisentrout]

Is it possible to structure a deal with seller financing and then do a 1031 exchange into a 721 exchange?

The background of the deal is that the buyer desires a low down payment and prefers seller financing. The seller is trying to minimize taxes as the property has doubled in value during their ownership and wants the proceeds of the deal to be liquid within 5-7 years in case they pass so the estate is easier to divide.

So far, both sides are on board with seller financing, 10% down payment, 30 year amortized loan with balloon payment at 5 years. Could the seller structure this deal in a way that at the end of 5 years the lump sum could be rolled into a REIT through a 721 exchange and avoid capital gains tax? Is there an easier way to accomplish this in a win/win scenario for each side?