If the area is only 400sq ft, I'd look into a mini split heat pump.

IMPO

SR

The best way forward is probably to just replace the existing outdoor condenser and indoor air handler. The smallest size you can get in a split system heatpump is 1,5 tons, which is oversized for 400 sq ft but I'm guessing that's what you have there now. I'm also guessing that this isn't just a single 400 sq ft room, which is why a mini split might not work (unless you have multiple indoor heads, which starts getting very expensive).

Depending on the space and where you're located, you may want to consider a through-wall PTAC heatpump. These are units as are commonly seen in motel rooms but a heat pump version rather than a strictly electrical resistance type, for heating. It would be a much cheaper alternative than a mini-split.