Los Angeles-based Decron Properties has purchased three apartment buildings since it entered the market four months ago, spending more than $250 million on the combined 772 units. Phoenix has been an attractive growth market for years, and the pandemic has only made it more appealing, according to Daniel Nagel, the firm's CFO, about why they are just now entering the market.

"The pandemic made purchasing in our existing markets very difficult. California and Washington were very low trade markets in 2020," Nagel tells GlobeSt.com. "Properties had a lot of delinquency, and frequent and sustained shut downs made the recovery difficult to underwrite. Arizona handled the pandemic very differently which encouraged us to focus more on that market as our current markets did not see a lot of transaction activity."

Population growth, job growth and overall economic growth has made Phoenix attractive for apartment investment, but Nagel says affordability is behind the firm's bullishness. "Average Phoenix rents are under $1500 per month and Phoenix has one of the largest population and job growth stories in the country," he says. "Over 80,000 people moved to Phoenix in the last 12 months and it was closer to 100,000 in the 12 months prior to that. These two data points lead to a sustained future rent growth, which is what our investment thesis is all about. Identifying markets with sustained rent growth."