Investors have been waiting out the recession and chasing yield where they can find it, but tepid job growth is still a major concern for the economy at large. Office, retail and industrial landlords will have a tough time filling space without a large dent in the 8.9% jobless rate; however, multifamily's fundamentals show increased demand, ROI, stable cap rates and a paltry construction pipeline. Overbuilt regions are still lagging, but the sector as a whole has rebounded faster than the others and a returning confidence among millenials will drive demand. The real question for investors is how much demand can pull the class B and C products back into the black.

Apartment property sales of $10 million or more clicked over $2 billion in January of 2011, according to Real Capital Analytics. Cap rates are holding steady at 6.7%, with only 14% of those sales coming from the distressed markets. Like everywhere else, REITs and institutional investors played a large role in buying, unleashing their pent-up capital to scoop up class A properties. Private purchasers, though, kept pace in 2010 by taking advantage of Housing and Urban Development monies as well as the ever-present Fannie Mae and Freddie Mac.

In January of 2011 alone, JP Morgan Asset Management grabbed the Liberty Towers in Jersey City for $280 million and AvalonBay Communities Inc. dropped $78 million for San Diego's Waterstone Carlsbad, not too far from the price it commanded before the recession. However, these were straight-up acquisitions, not the type of loan to own or REO strategies taking place in office and industrial over the past few years. So where are the multifamily distress sales?