I don't want to pay the general contractor's premium.

More about this in IRS 523Even if you qualify to exclude part of the cap gain under Sec 121 you are still required to pay Depreciation Recapture on sale (not the case with 1031 Exchange)1031 ExchangeOnly rentals are eligible for a 1031 Exchange - this is good news for you.

I usually ding their credit but thats about it and move on because I don't want to pay any lawyer fees. 

We no issues closing in an LLC, as a matter of fact most of my lenders will prefer it (assuming it is not your primary residence)Assuming it is not your primary residence, the easiest way to do this deal would be through a DSCR Loans.A DSCR Loan will use current rents or market rents if the property is vacant and personal tax return from you would NOT be required.It also referred to as a No Ratio Loan because your personal Debt To Income is not important.What is important is that the property can pay for itself.If we keep the LTV Low the rate for this loan can be better than a conventional loan.If you ARE Living in the property and you want to keep it... it would mostly depend on how motivated you are and how willing you'd be to "postpone gratification"The best bet is still a DSCR Loan.. which means you moving and renting the property out.We can bring in Asset Based Financing that can help with cash down (if you need it) or to pay cash for another property for you to reside in.Once you're moved out we can do the DSCR Loan at a 70% - 80% LTV or we can calculate a comfortable cash flow number.For example, max cash out that will give you $500 cashflow after a full PITI payment.Let's discuss more!

I am trying to find out if I can include closing costs I am paying on behalf of the buyer in my capital gains calculation.  

you need to talk to 10 lenders before you make any decisions. you won't be qualified for ground up construction without the experience. there's no such thing as sweat equity for general contracting. if you've never built a home how can you do it? 

The STR will pay out the first rental payment in January, so I have no idea how that one is performing. 

This rich area lets them buy buildings with many homes without paying upfront and at good loan rates while also using their VA loan perks.Good luck!

You might be through the pay-or-quit and filing periods by the time the lease ends.

Not saying you should do a bad deal, just that literally any property will make a huge difference in your take home pay, I'd be analyzing them differently than you would if you needed the cash flow.