Refinance to Add Units or Buy Another Property?

[Binyam Tedros]

My parents are refinancing thier home to use the money to create cashflow and would like some input on what you would recommend on doing. The house is in North Seattle (Shoreline) and they can pull out $540,000 cash by refinancing. 

The house has about is on 9,000 foot lot and we can easily add units to rent out but have no experience with construction or dealing with contractors. 

So the question is would you recommend dealing with construction when you don't have experience or would it be better to just another property cash somewhere else?