A Texas-based private equity giant has deepened its foothold in the South Florida office market with a nine-figure acquisition in Miami.
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Lone Star Funds, in a joint venture with Miami-based firms Square2 Capital and Highline Real Estate Capital, acquired The Alhambra, a two-building office complex in Coral Gables, for $119.6M, according to a release.
German asset management firm DWS Group sold the 326K SF complex at 2 Alhambra Plaza and 95 Merrick Way a decade after acquiring it for $118.5M.
The buyers took on the property's existing $58.3M mortgage with Capital One and tacked on $40.2M in debt for the purchase from Rialto Capital Management, according to property records provided by Vizzda.
“We are focused on investments where pricing reflects current market conditions while the underlying real estate maintains long-term relevance,” Square2 Capital principal Jay Caplin said in a statement. “This acquisition aligns squarely with that strategy and meaningfully strengthens our presence in South Florida’s core office markets.”
Square2 Management will manage the 14-story Alhambra Plaza and seven-story Alhambra West, which combined are 87% leased. New ownership plans a “substantial, multimillion-dollar capital improvement program across both buildings,” a spokesperson said. Upgrades are in store for the buildings' exteriors, amenities, lobbies and common areas.
JLL Capital Markets advised both the seller in the deal and arranged the financing for the buyers.
The Lone Star-Square2-Highline triumvirate made one of the biggest purchases of 2025 when it paid $225M to acquire Las Olas City Centre in Fort Lauderdale, also from an affiliate of DWS.
Coral Gables is one of the region's most active office markets. Across the street from The Alhambra, Columbus Center at 1 Alhambra Plaza sold out of receivership in March to Tourmaline Capital Partners for $76M.
Many office tenants, including consulting giant WPP, have been relocating their offices to the Gables in recent years after being priced out of Brickell. But it has also attracted some new-to-market tenants: Apple picked the Plaza Coral Gables in 2024 for its 46K SF Miami hub.
The office availability rate in Coral Gables was 14.9% at the end of 2025, below the Miami-Dade average of 15.7%, according to Savills. The neighborhood's asking rents were $61.07 per SF, below the metro average of $63.06 per SF and a far cry from Brickell's asking rate of $88.86.
“We have witnessed the tenant migration to Coral Gables driven by a more favorable commute, proximity to Miami’s bedroom communities and private schools, and more affordable rents,” Lone Star Managing Director Tessa Truex said in a statement.
UPDATE, JAN. 9, 8:55 A.M. ET: This story has been updated to include a statement from Lone Star.
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