I think there's a time to either cashout refi or sell but that is when you've accrued enough equity to parlay that into two more properties (which usually take about 5 years or so depending on the market).  

- "Once the money is deployed to the project they should accrue the preferred" meaning if they are entitled to 8%, I'd have a better shot at raising the money if they start earning their money at least quarterly in order to not get antsy, correct?

We go through a 6 month forbearance agreement where they need to put something down and pay something for 6 months to make sure they can even make regular payments and that typically comes off the accrued interest.

If we don't meet it, it accrues.

Reason for mentioning single story 4plex is to have the ability for tenants to pay for water/utilities vs. it being an extra expense I accrue.

Its an investment to accrue wealth. 

If not paid on time the "regular rent" is due, and 5 days after that a late fee accrues. 

If you have any leftover cash after expenses you might as well let that money accrue in an account so when you have an eviction, late payment, repairs etc.. you have the money to cover it.

Are you able to use the passive losses that accrue on Form 8582 in future tax years to take a greater loss or offset profits on Schedule E? 

In absence of doing anything else it would likely accrue to her and any of her kids not your daughter and grandson.