Add the flour, sugar and salt to a food processor and pulse to mix. Add the butter and process until the mixture resembles wet sand. Add the cream cheese and pulse until the dough comes together in large clumps. Place the dough on a floured surface and gently knead two or three times, just enough to incorporate the cream cheese. Form the dough into an oval disk, place in a plastic bag and chill, 15 to 30 minutes.
Preheat the oven to 350 degrees F. Roll the dough into a rectangle, about 15-by-10-inches. Cut the dough with a sharp knife into 6 squares, about 5-inches each.
Beat 1 teaspoon water and the egg in a small bowl, to make an egg wash.
Fill each dough square with about 2 teaspoons applesauce. Use your fingertips to moisten the dough edges with a little water. Fold the dough over to create a triangle. Use your fingers to press the dough gently together, then crimp the seal with a fork. Brush the tops of the triangles with the egg wash. Sprinkle the egg washed-tops with the cinnamon sugar. Place the triangles on a baking sheet lined with parchment and bake until the triangles are golden brown, about 15 minutes.
Be careful, the filling will be hot, so cool the empanadas about 15 minutes before eating.