Now, I think the best exit strategy to avoid recapture tax continue to build on your portfolio would be to do a 1031 exchange. 

It sounds like they have money, and it sounds like in exchange for that money you're setting them up with an income stream.

Regarding a 1031 exchange, it is important to have a conversation with your accountant prior to getting it done.

So, if you create an LLC in another state, you will likely need to register it as a foreign LLC in California.

In exchange for a reasonable discount of course. 

You may also see a discount fee which means you are buying down your mortgage interest rate in exchange for higher upfront cost.

e.g. is it possible for someone to lend $100k on a deal in exchange for, say 6% interest rate plus 10% share of profits?

I had to basically start from the beginning again bc the attorney I used for the longest time retired and my original post was basically like starting over--creative financing is foreign to most now.

@Judy Jacobs, consider fees and exchange rates to maximize the amount received.

Do that for a year or two and then help that owner buy another and you take a cut in the deal maybe in exchange for management.