I may be being too simplistic here but if you guys have $3m equity in property why spend so much time worrying about how you can make sufficient income from that to retire? Do you really need to leave the whole $3m on your death? Anyway, if you're in your 40s now surely by then the amount would have grown fairly substantially. Apologies if I'm misunderstanding but why wouldn't you just sell some and live off it, and leave the rest as you desire.
I guess it comes down to how much we think that we need..
For me it's about structuring things to take advantage of the asset base without incurring too much risk.
Why sell down, incur CGT and reduce your yield if you don't have to?