My goal is to leverage that equity for additional income.

They could self manage for several years, using the rental income, until the next phase of their retirement.If they have a decent amount of financial discipline, they may want to get a HELOC now before they build to get the most favorable rate.

My name and my daughter’s name(s) are also in title and the loan.I have really good equity in both properties (six figure) with great interest rates.At some point my daughters and their husbands will move out to upgrade to something bigger.I want to turn these properties into investment properties after my daughters move out:  thinking the best way is to convert in my name only.Also considering leveraging the equity in the properties to help buy new homes/townhomes for my daughters when they are ready as well.Wondering what the best strategies would be for me to expand property portfolio, minimize tax impact , create more passive income while continuing to help my family grow.I appreciate any advice! 

Paying our investors 6-8% Pref. then proceeding to a 70/30 waterfall split in our favor.

Would a home equity loan be a viable option in this situation, especially in regards to eliminating some of the red tape I'm running into with a refinancing an scorp-owned property?

Assuming when you say "$3900/mo in rental income" you mean cash flow.That means it will take you about 13 years of rental income to equal the $500k in equity you have now. 

These are areas where you can cash flow in Columbus because the rent-to-price ratio is favorable.

While I currently have 25% equity in the home. 

Tons of equity.

Obviously rates may differ than the rate sheet being advertised but just looking it appears the home equity and home equity loans are going to be more than a second mortgage or even a cash out refinance.