It was tenant occupied and the seller was in a rush to do a 1031 exchange.

I am planning to do reverse 1031 exchange.

What about an exchange? 

If you don't want to dump it, then consider adding a partner in exchange for equity.

Wondering if capital gains from a sale (and capital gains only) could be taken and rolled into a different property via 1031 exchange to avoid the tax hit. 

And if it did sell it would be transferred to a 1031 exchange to purchase aLarger apt complex

Sell tax free with a 1031 exchange into a larger deal.

Another option I have done is up my purchase offer in exchange for new Hvac.

@Christopher Jackson identify the multifamily you want to buy.use 1031 exchanges to sell your single family properties then roll the money directly into the new property. 1031s need to be done properly so make sure your agent is experienced.

Security deposit amountYou can find plenty of examples by searching for "tenant estoppel certificate doc" or exchange "doc" with "pdf" for more options.Here is an example and explanation: https://eforms.com/rental/estoppel-certificate/Some have a lot of legal jargon but this document does not need to be so detailed.