Then there is the fact that the fund is targeting a niche involving mid-size properties. "We're higher than what high net-worth investors would target and smaller than what the institutions would be interested in," Adler tells GlobeSt.com. Though Adler declined to discuss the portfolio sales price, he did acknowledge that the buy involved $8 million to $9 million of equity; "more equity than a high net-worth individual would pay," he adds. "We have an interesting niche, and can fund buys between $5 million and $15 million."

Adler Kawa Real Estate Fund II is focused on purchasing multi-tenant office and industrial assets in the southern and eastern US. The fund has raised approximately $50 million, and can raise up to $100 million in discretionary capital.

Both properties acquired are relatively new, and Adler acknowledges the cash flow was extraordinarily attractive, especially when it comes to ash-on-cash return and yield. He acknowledges that, while the portfolio's upside may not be as high as other purchases, the cash-on-cash return more than makes up for it.

Still, the upside involving rent growth isn't so shabby. "There isn't a lot of product out there, it's hard to build it and occupancies are already high," Adler remarks. "The only way to see any kind of building is for rents to continue to rise so they can justify development." Needless to say, rents high enough to justify construction is good news for already existing owners. "If that happens, it's a good day for us," Adler says.

Though Adler declines to discuss deals in the works, he does allow that the pipeline is very strong for the fund's strategy of finding assets that are in the mid-market size range and offer healthy cash-on-cash return. He says many of the deals being examined are in Texas; and the fund is underwriting a portfolio in Houston that's off-market.

And though there's been a great deal of investor competition in and around Oil City, Adler isn't too concerned. "Capital is still looking myopically at a narrow band," he says. "Though more are looking at Houston, some are concerned with development."

But this isn't an issue for the AKREA fund. "As long as we're buying product at a significant discount to replacement costs, we're insulated from the potential boom-and-bust nature of the market," Adler says. "Our type of product would be difficult to develop at our current basis."