With Citibank signing the initial lease on the273,000-square-foot, class A building for 10 years with fourfive-year extensions, leasing at 396 Alhambra is expected to gainmomentum as larger tenant prospects look for new space beyondDowntown Miami. Coral Gables is considered a quieter, lesscongested alternative to Brickell Avenue and other parts of thecentral business district.

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The new tower is being developed by Eddie Avila and HectorFernandez, principals of 396 Alhambra LLC, with financial backingby Agave Florida Investments LLC, the Mexican real estate arm ofpopular tequila brand Jose Cuervo. The developers are financing themajority of the $140-million project, says Darryl Robinson, thebuilding's leasing agent and founding principal of Miami-based OakHill Advisors.

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"What makes this project unique is the ownership's commitment tothe Gables," Robinson tells GlobeSt.com. "They are extremelybullish on South Florida and felt that this was one of the lastdevelopable sites in the Gables, in a market that hasn't beenoverbuilt."

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Coral Gables, with 5.9 million square feet of office inventory,currently has overall vacancy of just above 20%, three percentagepoints higher than the Miami-Dade County average, according toCushman & Wakefield research. Asking rents for new space at 396Alhambra are $40 per square foot, in line with the submarketaverage.

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While more than 2.2 million square feet of new office space isbeing built in the Miami-Dade market, mostly in the Brickell andCBD submarkets, Robinson believes 396 Alhambra sets itself apartfrom those other buildings by its strong financial backing. Thespeculative building is far less likely to fall into a distresssituation because of strong financial backing, which should appealto prospective corporate tenants seeking at least 30,000 squarefeet.

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"The landlords used to be the ones checking on the credit oftenants. Now, the tenants that are checking on the landlords," hesays.

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Construction of 396 Alhambra's north tower, at the corner ofAlhambra Circle and LeJeune Road, is set to begin in the next twomonths with an opening date expected in the third quarter of 2011.Other marketing points of the building include 30,000 square feetof ground-floor retail and a dedicated parking garage with nearly900 spaces.

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