How to handle raising rent when taking over new property?

[James Ashley]

A local investor is dumping all of his properties and I'm considering buying one. This will be my first property. The property is currently rented and the renter is paying a below average rent for my area. I plan to update the property and then raise rent to meet my area's average (increase of $325 a month). How do I go about this? Not only from a business stand point but from a moral one as well? 

If the tenant is ok with paying the new higher rent how should I go about having the work done? Scope of the work includes exterior/interior paint, new flooring, and kitchen update. Obviously speed will be the key but how do you handle a kitchen remodel and replacing floor when a tenant is living in the property?