I am aware of California's Prop 13+58+19 prop tax inheritance evolution and its complexities with LLCs but we are not considering inheritance or parent->child gifting etc.

For example if you wanted to gift $100k to your child to purchase a business, it may be best to make your child manager, with say a 20% interest, while you and or your spouse maintain a 80% interest.  100% of any net income can still be received by your child as manger, or even for just his 20% interest, as profit allocation  need not align with ownership percentage in an LLC.

Sure if you dont have your own 3-5% down payment then yes use DPA if you really want to buy.After going over the pros and cons typically our FTHB'ers or first time home buyers end up getting a gift or bring in their own 1-2% down + 1-3% gift and end up with 3-5% down payment and borrow at regular FHA/conventional rates (avoid the DPA program rates).This is actual experience.

I have recently been gifted my great grandparents home and it's going to be a complete gut and renovate costing approximately 150k.

I want to use her equity as a gift for the down payment to avoid capital gain taxes.

Another thought you could just keep the tri-plex and gift them the net income each year...it's basically the same thing without any transferring. 

Keep them updated to reflect seasonal decor or recent upgrades.Offer High-Impact Amenities: Small touches like a coffee maker, fast WiFi, or a thoughtful welcome gift can transform a stay into a memorable experience.Stay Communicative and Proactive: Prompt, friendly communication makes guests feel valued.

I don't know much more specifically so ask your CPA about gift taxes (I think she could give you $17k of gift money a year without taxes) or capital gains taxes if/when you want to sell. 

:)  Really though, I'm gifted and complexity is my middle name.

I will be glad to send you a $50 Amazon gift card for a really plausible theory.