From The Heroes of Might and Magic III wiki

[edit] Kennels

The Kennels is the level 3 dwelling of the Inferno town. It produces Hell Hounds at a rate of 5 a week.

Requires: Fort, Imp Crucible

Cost: 1500 Gold, 10 Wood

[edit] Upgraded Kennels

The upgraded Kennels allows the production of Cerberi

Requires: Fort, Imp Crucible and Kennels

Cost: 1500 Gold, 5 Sulfur