If anyone else is having the same issue, it can be resolved this way. First add a new customer or ignore if they are already created. Then add a new website from the Reseller/root Enhance panel with the subdomain dev.domain.com. Once added, go to the "Websites" section as the reseller/root, click on the three dots next to the newly added subdomain website (dev.domain.com) and choose the "Transfer Ownership" option. After this, you can select the customer account, package and transfer the ownership of dev.domain.com to the new customer. Looks like this cannot be added directly from within the other customer's control panel due to security.