Harbor Associates plans to buy $250 million in Southern California suburban office product this year. In the first quarter, the firm has already closed $90 million in deals—putting them on track to reach their end-of-year goal—most recently purchasing the four-building 213,459-square-foot Encino Office Park for $47.85 million. The firm is focused on first-ring markets outside of major metropolitans, where there are healthy market fundamentals and reduced investor competition.

“We're bullish because we see a disconnect between the healthy market fundamentals and the investment goals of institutional capital, which we believe creates a buying opportunity,” Paul Miszkowicz, a principal at Harbor, tells GlobeSt.com. “Lots of articles are written about the fundraising efforts of major institutional real estate players and the amount of dry powder that these groups are sitting on, but in our experience the investment 'box' for a large swath of the investment landscape is pretty well defined with 'value-add' deals in 'primary' locales seeing an over supply of investor interest.  When you look to invest one ring outside of the 'bulls eye,' investor interest drops off materially.”

While these properties are located outside of the CBD, they have strong tenancy with a tenant roster that often includes Fortune 500 tenants. This tenancy is another incentive for Harbor's acquisition strategy. “Harbor's portfolio has a tenant base which ranges from Fortune 500 companies to sole proprietors,” says Miszkowicz. “We're seeing business leaders making purchase decisions, growing their real estate footprints and square footage, investing in their space as a tool to attract and retain talent, and signing long term leases—all indicative bullish signals.