CORAL GABLES, FL-In the face of a commercial real estate downturn, the biggest challenge in completing lease transactions is that tenants and prospective tenants are uncertain about the future, says Eric Swanson, executive vice president and market officer for Flagler Development Group. Like many firms, Flagler has taken on a back-to-basics strategy to weather the storm, working with its existing and possible new tenants. Through its efforts the company completed 1.4 million square feet of new and renewal lease transactions in the fourth quarter of 2008.

Many of the largest deals, which were undertaken by Flagler Real Estate Services, the firm's brokerage arm, have been closed in properties located in Miami. DSV Air & Sea Inc. signed a 57,733 square feet industrial lease and Santillana USA Publishing Co. renewed 38,379 square feet lease at AMB Property's Beacon Centre at 1701 NW 87th Ave. At Flagler Station, located at 10505 NW 112th Ave., two industrial tenants, Kassatex Inc. and TY, TY & TY, renewed their 33,814-square-foot and 37,446-square-foot leases.

Flagler has also signed its third lease at Met 2, a 750,000-square-foot class A project under construction in Downtown Miami that is now 33% preleased. The firm is the exclusive leasing agent for the project, which is being developed by a joint venture between MDM Development Group and New York-based MetLife. Met 2 secured a $250-million construction loan in October, and the project is on schedule for delivery in May 2010, says Swanson.

The Florida Department of Agency Health has renewed its 43,000-square-foot office space at Doral Center, which will expire as its 43,000-square-foot lease takes hold at a new 150,000-square-foot building that will break ground over the next two months at Flagler's Downtown Doral development at 8333 NW 53rd St., reveals Swanson. Quoted rates in the new building range from $22 to $23 triple net, with operating expenses anticipated at $13 per square foot.

The class A building is the only development planned to break ground this year for Flagler, says Swanson. The firm expects to focus its energies on working to alleviate stress and pain being felt by tenants, while talking to prospective candidates for its existing centers, he adds. "I think it's going to be a very flat year and our occupancy is going to hover right around 90% to 91%," where it stands now, Swanson tells GlobeSt.com. "Our stabilized rents are also staying flat right now. Some markets are experiencing a bit of downturn in their rates, but statewide, in 2009 we're not seeing growth over 2008 numbers or a severe dip."

Flagler owns, manages, leases or has under development approximately 13 million square feet of office and industrial space throughout Florida. The firm's total square footage of completed lease and sales deals in 2008 reached almost 4 million.