"Plan B" refi strategy ?

[Michael Klinger]

I have an owner/user building that houses my business. There is substantial equity in the building, while simultaneously the business is no longer strong as it once was. 

My current plan is to sell (it is currenty on the market). If/when it sells I will likely close the business. "Maybe" move business  to a rented downsized location, maybe not. Then I plan to move the building proceeds to a 1031 purchase Multifamily and start a new chapter in my life.

If... I don't sell and I still want to get that equity working better for me, what are my re-fi strategies? Is there a reasonable scenario to re-fi cash out and use the cash out as a down payment on a new purchase? Is this done? 

Or is is ridiculous to use cash out re-fi money as your skin in the game down payment. I'd imagine most lenders are looking for a real down payment with real money, not money borrowed against equity on another property?

Please enlighten me.