I am crazy to leave a decent paying job, with benefits and retirement to escape the horrible day to day?

Wow that’s incredible, depending how much of the 1.4M is a gain.

It is tight but if you are willing to live there for a few years, do the work yourself, and it gains some healthy appreciation you could do alright.

I'll apply the $500k capital gains exemption to the personal residence.

I strongly believe that carefully vetted commercial MF syndication is a good investment vehicle due to many many reasons (professionally managed, more passive, economy of scale due to large units, spread of risk due to multiple partners, and all the goods of Commercial MF like forced appreciation through value add, not only to mention all the tax benefits)...

Money is a store of productivity from which others benefit, including you. 

Am I missing some benefit to this?

@Isiah FergusonI would refi both properties with a conservative 70% LTV  thats about 180k in cash and to me its a hell of a way to gain some momentum.

There are brand new pass through deduction rules that are pretty complicated but can give you a big benefit if you qualify. 

What are the benefits to owning properties on my own portfolio or heading up an LLC and buying the properties through that entity?