Help with First Commerical Purchase

[Dan Walters]

I'm working on my first commercial purchase and I am looking for some help/input/advice on analyzing the deal. We have not received all of the books to perform our due diligence yet so these are rough numbers given by our agent (not counting on this until we see the hard numbers, obviously). Property is 9400 sq ft and sits on 1.75 acres w/frontage on a rim/bench location that overlooks the city and mountains. It is also along a high traffic area.
Our offer currently @ $520K
Haven't decided financing: cash vs. loan
Occupancy at 50% with gross rents of $8200
OE roughly $1200/mo-owners have been paying all utilities (not sure why).
One of the tenants wants to reduce their sq.ft usage from 6200 to 2500-3000. The other tenant wants expand their usage (restaurant) from 2500 to roughly 4500-5000sq ft, which would require some remodel (not sure what to do here).
Taxes are $13k for '09
Property built in '71 and had extensive remodel done in '99.
Seller is willing to credit $16k for roof repair.
Property has roughly .75-1 acre of empty lot space for future development.

Where would you start in analyzing this deal, given that structurally the building is sound and sellers are willing to make repairs to roof?
Hope this is enough info. Any input is greatly appreciated.

Thanks in advance.