After two years of occupancy, qualifying for the tax exemption, and benefiting from appreciation, we chose to sell and reinvest the funds.

I have some ideas about how to do this so we both get the most benefit, but there's one part of this that I want to get some input on. 

Quote from @Stuart Udis: @Robert Ellis In order for the QOZ investor to reap the tax benefits the hold period has to be longer.

Any other angles to play using BHA allowance, or other military benefits?

They also like the tax benefits associated with ownership.I've taken both approaches and have benefited from each.

This allows you to benefit from appreciation, continue building equity, and still access capital for new deals without sacrificing an ultra-low fixed-rate loan.Would love to hear what direction you’re leaning—lots of ways to approach this depending on your risk tolerance and goals!

While this structure offers great asset protection benefits, it doesn’t necessarily save money on filing fees or administrative costs.

As Dan said though, there are many tax benefits.

I am wondering if I can claim it as a repair(counting against rental income) or if it must be claimed as an asset (with depreciation benefits)?  

You have tax benefits through depreciation and you are gaining experience via property management.