Unique opportunity with property I already own

[Steve Iacobbo]

My personal residence and a commercial property I own are on the same piece of land under the same mortgage. The commercial part (separate address, yes separate address but on the same mortgage, go figure) needs some work, about 50k.  I currently rent out the commercial part but I know I can get more for it if I update the property - new roof and updated heating/AC are some of the things needed, so the renovations are more than cosmetic. I don't have enough free cash to do all the work. I'm not sure how to gauge what the value of the rehab'd property would be.

One option is to refi now and see if there is enough equity to increase my HELOC to do the rehab. If there is I can use these funds, but this would leave me without investment funds after the rehab, so I'm not sure I like this idea. Someone else said not to do that, but rather to use my current funds to do as much work as I can, then reif after the work is done because the value will be greater. I guess I'm not sure how to accurately estimate what the values of the property will be after the work because there aren't any similar situations around so I'm not sure how to evaluate my options in this situation.

I'd love to hear from some folks with more experience about this.  Thanks.

Steve