Advice on converting a two bedroom to a three bedroom apartment

[Ryan Rea]

Hey BP.  I need some advice.  I currently have a three family property under contract.  All three units are comprised of 2 bedrooms and 1 bath, and each apartment has approximately 1100 square feet of living space.  

I'm trying to figure out if it's feasible to convert the living room to a third bedroom(each apartment has a kitchen, living room, dining room, two bedrooms and one bath).  I have already had a contractor quote the job to cost around 3k for demo, framing, sheetrock, per unit.  

In my area, a three bedroom rents for about $200 more than a two bedroom, so this option would definitely be cost effective in recapturing the investment.  However, would the lack of living space/living room drive away potential renters or do you think that a third bedroom is more desirable?  Any advice would be appreciated.