16" at 4 percent body fat is different from a soft 16" arm at 14% body fat. That guy could be even leaner. 2% isn't out of the question.
Both guys might weigh 175lbs. The picture you show of that guy has 7 pounds of fat and 168 lbs. lean. The other guy is 24.5 fat and 150lbs lean. One arm is hard lean muscle and the other is soft.