A real estate business is not different then any other self employment income.

In my case, I have residential rentals in one LLC, commercial properties in another, self storage in a third, and my real estate company operates in a fourth.

Our lot size is 7300 sq ft and main house is 1700+ sq ft.Location: San Jose, CA- We were thinking to potentially design the ADU such that we could have a wall (or a door) that allows us to separate the ADU into a 1 bed/1bath for self use (or rental) and another part which could be rented separately on AirBnB as needed.

Mine is boredom between Self Storage and Country subdivisions.  

No personal experience with PMs since we’re local and self manage, but there are 1-2 that I’ve heard good things about. 

Add maintenance/cap ex, vacancy, PM, misc and this is likely negative more than $500/month even if self managed (much more than the negative $200 that you indicate you are ok with) 2) if you are behind on mortgage, how are you going to handle being negative $200/month, or more like negative $500/month?

With regard to your "DST" and as with many highly structured tax vehicles that have a potential "self dealing" quality to them, there are a number of potential potholes you can easily step in along the way (e.g., constructive receipt doctrine, effective control over nominal 3rd party relationships, lack of genuine risk bearing and compliance with transactional terms, etc.).

Given that the industrial market is softer than the prior few years, I intend to buyout/wait until current leases expire and leverage the space into self-storage. 

Your future self will thank you!

@Brandon MorganI self manage my 29 SFR and run into this all the time.