Like you pointed out it will cause a firewall like break in the chain.

The LLC does not protect you from legal risks, it just firewalls it within the LLC (and that's not even guranteed, there are ways around).

FIREWALLS on doubles.

@Lamont Marable find an investor friendly agent and you can get all of these questions answered for free from Someone that wants to earn your business.Adding units is extremely difficult if there is not already a fire suppression system in place or fire walls present.

Will need to get a firewall.

You also want to put a firewall between your buy/sell risky projects and your portfolio projects held in the other entity.

The other reason may be that zoning did not allow for the additional unit when built.When I looked into finishing this area in about 2016, (this is city of Burien, not seattle btw)  the sticking points were that they wanted the entire building retrofitted for current insulation standards and firewall ratings and addition of sprinkler system.   

Don't answer these questions here, just for yourself, because it will tell you if and where you need to set up these financial firewalls called LLCs.