Wondering how to best renovate commercial space

[Laura M.]

Hi!
I'm new here, and am a newbie investor.  I am closing on a commercial building complex in about a week (in our hometown). The building has 2 rentals in it:  One office space, and one residential space (both in excellent condition).  It has a large industrial space which we will be rehabbing and using for our main business. There are 2 other spaces that are in need of renovating, and could be rented out.  The rents on the two spaces (office and residential) will barely support the mortgage, but not cover the expenses of the building, and certainly not provide any income for renovation.  We are buying it largely because we need a space to house our main business.

Here's our dilemma:

What do we do with the other 2 spaces (currently low-grade industrial/ warehouse) spaces and how "well" do we renovate them?  We live in an up and coming area of Colorado, where there is a surge of interest & investment (as other neighboring regions become increasingly pricey.)   I would LOVE to renovate the  space into a nice office space, but I'm not sure the market would support it yet. (Though I believe that the market will support it in 5-ish years, depending on how the market does in Colorado.) The current rental market in the town is soft, though there does seem to be a real lack of nice office spaces available in the area.  I would appreciate advice and resources on how to analyze how much I could spend on renovation and hope to make a good return on the rental.  We don't want to over-extend ourselves because we hope to purchase other properties before we are priced out of this market.  We are definitely buy-and-holders, though we wouldn't be opposed to flipping something if the right thing came along.

Your thoughts or advice very much appreciated!