Section §469 does allow grouping of 100% owned business with other 100% owned rentals if the rentals are used in the 100% owned trade or business.   The activities must constituent an appropriate economic unit.  If they do, then the two can be grouped together and the rental loss could offset non-passive ordinary income from the other business. In a nutshell, 469 allows you to convert your self rental and deem it material participation - i.e. converts passive losses to non-passive losses.

With the grouping election, you might be able to avoid the negative self-rental rule results by electing to “group” your business activities and rental activities for purposes of the passive loss rules — if both activities together constitute “an appropriate economic unit.”  The factors given the greatest weight when determining whether a group is an appropriate economic unit are:

• Similarities and differences in types of businesses,
• The extent of common control,
• The extent of common ownership,
• Geographical location, and
• Interdependencies between or among the activities. 
• The interdependencies factor might consider, for example, the extent to which the activities purchase or sell goods to each other; involve products or services that are normally provided together; have the same customers or employees; or are accounted for with a single set of books and records.