While taking out contributions is not taxed and penalized, taking distributions of earnings may incur both depending on your age.  

Assuming you want to hold it to further speculate on appreciation you could do that if you are prepared to contribute monthly to your tennats rent out of your own pocket.

Thank you all for contributing.

How Im seeing it set up is a lot of my investors are opening LLC's with cash partners, their contribution is doing the legwork and their partner is the silent money partner.

Or they take the view that your entity did not take title with the intent to hold but rather with the intent to sell (true) and property acquired with the primary intent of resale is not eligible for 1031 treatment.You're much safer to complete the exchange personally and then with your lender's permission contribute the property into your LLC after the 1031 is complete. 

That was the pitch when they were created in the early 80's.HINT: With current low tax rates, limit IRA/401Ks contributions and/or go for the Roth options. 

Thanks a lot for your contribution and thoughts!!

Contribution from you on your LLC’s books.

I’ve been lurking too long it’s time to contribute haha

Chances are that  after calculating the 10% return and adding expenses the property will contribute nothing.