When I only had two we split up the kids. We had two large beds, one in the toddler's room, and my husband and I began reading to him in that bed and one of us slept in there. Now I know that looks really sad; one parent in another room and all. However, this smoothed the transition for our older child, and in reality made things a lot easier on everyone. My older kid woke a lot during the night (more than a newborn), and he was a super restless sleeper so I didn't really want him next to a newborn until we all got the hang of things. My husband was grateful for having a place away from the new baby when he went back to work.
When we had baby number 3 we did a really big bed. King size next to a full size on the floor. This took up the entire loft of our cabin, and we all slept together that winter out of desperation (no heat and one of the coldest NorthWest winters I can remember) By then I was an expert at carving out my own little space for babe.
-Best of luck,
N.