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MIAMI-It’s a good time to be a renewing office tenant, and the longer one has been in a building, the better. Occupants at or near the end of their lease terms are able to negotiate better rents, or at least more favorable space, during the ongoing downturn.

The latest example of this type of leverage is a renewal and expansion by InSource Inc. at the Dadeland Towers South building, where it has had its headquarters since the early 1990s. The insurance and employee benefits agency will move from the second floor to the building’s fourth floor, signing for 13,176 square feet, including a 1,000-square-foot expansion.

“This deal was kind of a poster child for this type of scenario,” Bob Orban, senior vice president and local branch manager with Studley Inc., tells GlobeSt.com. He says the renewal between InSource and building owner AvMed Inc. had been going on for the past year and a half as the tenant considered possibly relocating to another office building.

Had InSource made a decision earlier while the office market was more robust, it would have likely stayed in its old space and paid rents closer to the Miami metro area’s average of $30 per square foot, Orban says. But while the tenant weighed its options, AvMed lost another key tenant and the larger fourth-floor space became available.

“They did wake up in the end and realized they have got to keep their tenants,” Orban says. “You can structure some tremendously favorable deals right now.”

InSource’s 10-year renewal and expansion is valued at nearly $3.3 million, including rents in the low $20-per-square-foot range and a tenant improvement allowance, according to Orban. Nearly 70 employees will move to the upper floor once the buildout is completed in February 2010.

Bill Parker, InSource vice chairman, credits Orban with working diligently with the company over the past 18 months to get “what we believe is the most competitive transaction signed to date” in the Kendall/Dadeland submarket. “At the same time, we were able to maintain a long-standing and important relationship with AvMed,” Parker adds.

Chris Dekker of CB Richard Ellis represented AvMed in the transaction. Dadeland Towers South is located at 9500 South Dadeland Blvd., just west of US 1.

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