Institutional investors scrambling to offload office properties are finding willing takers in smaller, privately managed firms eager to take advantage of the opportunity.

Synergy, a Boston-based real estate investment firm, is the latest example of a buyer leveraging steeply discounted prices in order to bulk up their own office portfolios ahead of what they expect will be a strong market rebound. The firm closed its second office acquisition within a week, finalizing a deal Wednesday that marked one of the city's largest office acquisitions since 2019, according to data from CoStar and the Downtown Boston Business Improvement District.

The local firm paid $78 million for the nearly 477,500-square-foot property at 101 Arch St. in downtown Boston, according to property records. The deal with seller Clarion Partners marked a steep discount compared to the nearly $122 million the global asset manager paid for the 21-story property in late 2005, underscoring the dramatic decline in office valuations across the country as a new wave of buyers helps reset price expectations in the face of the market's economic reality.

“Adding 101 Arch Street to our portfolio aligns perfectly with our strategy of investing in high-quality assets in prime locations,” Synergy founder and CEO David Greaney said in a statement. The downtown property "represents a prime opportunity for Synergy to create value for our tenants and stakeholders."

The building is currently about 83% occupied by a mix of financial, insurance, professional services and healthcare tenants, according to CoStar data. The recent deal means Synergy's office portfolio now encompasses upward of 7 million square feet.

The Arch Street acquisition follows Synergy's purchase last week of the 221,000-square-foot office building at 179 Lincoln St. almost half a mile away. The deal with seller Blackstone — another institutional investor that has been eager to slim down its office holdings — meant the firm assumed $76.5 million in mortgage debt.

The downtown building, which was more than 80% leased at the time of the deal with Synergy, was purchased by Blackstone for nearly $156 million in January 2020.

Similar to other markets across the country, office valuations in Boston have collapsed under the pressure of flexible work trends, depressed leasing volume, bleak refinancing conditions and high interest rates. The fall in office values could match or surpass the depreciation reported throughout the Great Recession, credit rating agency Fitch Ratings wrote in a recent report, adding that prices have yet to bottom out.

Office values have fallen to a near four-year low, and any recovery effort is expected to stretch far beyond the time it took for the market to bounce back from the 2008-era crash. Average valuations are down by as much as 15% since the end of 2021, according to CoStar analysis, with larger, institutional-grade properties dropping by about twice the rate.

In Washington, D.C., Blackstone and its joint venture partner recently unloaded the two-building Market Square complex for $323 million, or roughly the amount remaining on the former ownership's loan. The roughly 690,000-square-foot office complex was last purchased for $615 million in 2011, according to local property records.

Properties in Boston — where vacancy rates have climbed past 11.5% and are expected to rise even further — have all but frozen investment activity, and the deals that are closing have been priced about 20% lower compared to year-end 2021, according to CoStar, deep discounts that spotlight the challenges in underwriting office buildings in the current environment.

JLL’s Coleman Benedict, Chris Angelone, Scott Carpenter, Brooke Howard, Scott Tully Jr. and Rachel Bliss brokered the deal between Clarion Partners and Synergy.