You should ha e a talk to council first (start with the town planner). It may depend on whether you want to sell the "units" seperately or not. If you elect to sell them together then you may have no need to subdivide the property, just do the reno and collect the 2 rents. You'll just have to sell both properties together at some time in the future.

If you do want to subdivide then you generally need to firerate (you can't fireproof) the premises and this is generally a rating on the time fire is retarted from spreading to the adjoining unit. There are a number of way this can be done, but best to start with the council to sell if they'll even allow a dual oc.