@Andrew S.You should work with your CPA/EA on treatment of this sale.Generally a sale materially below FMV to a family member or friend would be considered part sale and part gift. 

Not each rental.The rules surrounding IRC Sec 199A are intricate and complex.  2018 might be a good year to get some quotes from a tax CPA/EA.I foresee a lot of 2018 amended returns in a year or two that were DIYed via TurboTax et al.

There's this intricate mathematic relationship between interest rate,cap rate and IRRSo during QE era.

Getting freebie advice on a very intricate and personal problem on BP is not really going to serve you, any fees you pay to a tax professional is going to be worth the savings they're offering to you.

They do not "sell" the asset to the LLC they gift it/give it (which could have tax implications), but as noted in this and other posts, the LLC is not separate.

For example your grandparents passing away with the asset will be a good tax answer but it could be a bad financial answer if they are in care centers and rack up $800k in debt which encumbers the land.1st priority is likely retaining the land, debt free if possible.2nd family operating goals3rd may be tax goals as you may not have any issue until you sell it.4th may be easy of transfer but in taking care of priority number 1 you may find your best bet is to gift the asset away or put it into a trust eliminating this issue. 

I have a note to leave him in the morning, letting him know how awesome he was, and a Apple Bee's gift certificate.

He is originally from Germany and we've been presented with a great opportunity to take over one of his parents’ homes as a “gift” or possibly a small price (later discussed).

Maybe a gift card to the grocery...

I doubt I would have gifted wine had I not known that.