Essentially, it's quite a capital intensive project and finding financing for this will be very difficult.

If you named those two buildings as one identification then they essentially become a portfolio. 

The best and most optimal path forward will essentially be dictated by their wishes, and should take into consideration asset protection, income taxes and estate/gift taxes.

Though essentially, to make it short.

Who is on the mortgage paperwork?

This was a primary residence for 8 years, a rental for only one or less.The good news is that it does qualify for the Section 121 Exemption, which is a better plan if you qualify. 1031 essentially passes the buck on the tax bill, Section 121 ELIMINATES the tax bill.It sounds like you qualify - you lived in it as your primary residence for 2 of the last 5 years (actually 4 of the last 5).

NOTE: The Philadelphis Sheriff's office does not handle the paperwork to start the lockout process for landlord tenant cases, so you have to contact the Landlord Tenant Office instead.For all my previous evictions in Philadelphia County, I had to wait 10 days after the judgement to file for a "praecipe for writ of possession" and a "writ of possession".

The more paperwork you can throw in front of the Judge the better.Just be aware that once you win the case and have a judgement, you still have to collect, how are you planning on doing that?

Both are great units to house hack, since they have their own entry points to the unit so essentially you would never see the tenant. 

Sure it's more time intensive, but if you're just starting off that is time well spent and is essentially free.