ORANGE COUNTY, CA—The continuation of institutional capital targeting the OC office market, along with the usual push to close transactions prior to the end of the year and the looming specter of rising interest rates, fueled many transactions in the fourth quarter of 2015, Newmark Grubb Knight Frank's executive managing director Robert Griffith tells GlobeSt.com. Following the release of the firm's Q4 2015 Orange County office report, we spoke with Griffith about the biggest takeaways and what they say about the OC office investment market.

GlobeSt.com: What are the biggest takeaways from your Q4 2015 Orange County office report?

Griffith: I think the biggest takeaways are that job growth is up, vacancy is down, cap rates are down and investment sales are going strong. Additionally, the NGKF Q4 report highlights that positive net occupancy contributions came from all five submarkets, as tenants absorbed 435,327 square feet in the fourth quarter and more than 2 million square feet during the year. This marked the fifth straight year of positive net absorption, tying the streak that ran from 2002 to 2006.

GlobeSt.com: Why were so many deals with a high price tag completed in Orange County in the fourth quarter of 2015?

Griffith: There continues to be a lot of institutional capital targeting the Orange County market, particularly in the CBD, which in combination with lack of product pushes pricing. Those factors, along with the usual push to close transactions prior to the end of the year and the looming specter of rising interest rates, created an even higher sense of urgency than normal to purchase or sell before the cost of capital increased.

GlobeSt.com: What do these deals say about the state of the Orange County office investment market?

Griffith: These deals in the last quarter of 2015 provide further testimony that the market is still strong and that it is perceived as good long-term investment. Orange County is increasingly becoming a more attractive market for capital. Among the four Southern California markets, Orange County scored highest according to the 2015 NGKF office momentum index, which measures market strength.

GlobeSt.com: Do you anticipate additional large transactions to take place in this market the first quarter of 2016?

Griffith: I believe that there will be more product to come to market in first quarter of 2016. Deals that didn't close in time for fourth quarter end will likely close in the first quarter, which could translate into some large transaction activity. The good news is that the rise in interest rates is seemingly having a negligible impact on the market, and Orange County commercial real estate is still perceived as a strong investment.