Upgrading Windows Server 2012 Essentials

Hi,

  I have a network with 5 workstation PCs and 1 file server (running Windows Server 2012 Essentials on HP Proliant MicroServer Gen8, two 7200rpm SATA HDs, as a physical standalone server).
  I am going to upgrade this physical server to a virtual server and here is what I have in mind:
 1. On a new HP Proliant MicroServer Gen10 server with two 7200rpm SATA HDs, I will install Windows Server 2016 Essentials OS
 2. Add Hyper-V role to the OS.
 3. Convert an existing Windows Server 2012 Essential Server to a virtual server using Microsoft Virtual Machine Converter (MVMC)
 4. Turn on this virtual machine (running Windows Server 2012 Essential) and perform in-place Windows 2016 Essential upgrade.

 I guess I could perform in-place upgrade to Windows 2016 Essential on current physical server (running Windows Server 2012 Essential) before converting it to virtual server, but I thought it would be easier to upgrade OS in virtual environment.

 What do you think?
 Is this what you would recommend?

 The only other concern is that how responsive the new virtual machine (running WE 2016) would be in Hyper-V environment on a RAID 1 with two 7200rpm SATA hard drives.
 Currently HP MicroServer with two 7200rpm SATA hard drives are running just fine for average 3 users opening Word and Excel files. No one ever complained about the speed.

 I could also forget about setting up Hyper-V server and just set up another physical server running Windows Server 2016 Essentials just like current one.

Thanks.