DWS Group’s Coral Gables Office Complex Listed for Sale at $125 Million

DWS Group has officially listed its two-building office complex, The Alhambra, located in Coral Gables, with a target price of approximately $125 million. This strategic listing comes on the heels of the asset manager’s recent divestment from downtown Fort Lauderdale, where it sold two office properties earlier this year.

Overview of The Alhambra Office Complex

The Alhambra comprises:

• Alhambra Plaza:
  • 14 stories
  • 232,100 square feet
  • Address: 2 Alhambra Plaza
• Alhambra West:
  • 7 stories
  • 94,300 square feet
  • Address: 95 Merrick Way

Location and Surroundings

This office complex occupies a 3-acre site that spans an entire city block, strategically positioned between the Hyatt Regency Coral Gables Hotel and the bustling Coral Gables area. Notably, the hotel is not up for sale.

Occupancy and Tenants

• Alhambra Plaza: 89% occupied
• Alhambra West: 83% occupied

Both buildings underwent renovations in 2018, enhancing their appeal and functionality. Current tenants include notable companies such as:

• ABH Air Conditioning
• Disney Latin America Media
• Lisinski Law Firm
• Bella Bridesmaids Miami

Additionally, this year, Transwestern Real Estate Services moved its office from the Miami Tower to a 4,500-square-foot space at The Alhambra.

DWS Group’s Background and Recent Sales

DWS purchased The Alhambra for $118.5 million in 2015 through a fund representing an overseas institutional investor. The firm, which was previously known as Deutsche Asset & Wealth Management, continues to operate under CEO Stefan Hoops with Hepsen Uzcan and W. Todd Henderson leading the regional divisions.

Strategic Divestments

The decision to list The Alhambra aligns with DWS’s recent trend of selling office properties in South Florida. Earlier this year, DWS sold the Las Olas Centre I & II for $208 million and the Bank of America Plaza for $221 million, both transactions indicating a significant shift in asset management strategy.

Market Insights

Despite rising interest rates and what many consider a cooling market for new leases, the South Florida office investment landscape remains vibrant.

Factors Influencing Office Sales

Key factors driving the current market environment include:

• Increased average asking rents in the tri-county area.
• Declining average occupancy rates, prompting landlords to liquidate assets.

This strategic move allows investors to break even or achieve a profit margin, especially in regions where the market is underperforming.

Key Transactions

Recent notable office transactions in the area highlight ongoing interest, including:

• Ponte Gadea, owned by billionaire Amancio Ortega, acquiring the Sabadell Financial Center in Brickell for around $275 million.
• Triarch Capital Group’s sale of the Pembroke Pines Medical Plaza for $38.3 million.

Conclusion

DWS Group’s decision to sell the Coral Gables office complex reinforces the ongoing evolution of the South Florida real estate market. The Alhambra presents a compelling opportunity for investors looking to capitalize on the area’s growth and demand for quality office space.

For further details and insights into the property market, check out related articles on The Real Deal.