While shopping more than $700 million worth of properties, the REIT is being conservative in its 2002 projections, forecasting only $500 million in sales in its 225,000-unit portfolio. Meanwhile, Crocker sees conditions improving on the buying side of the multifamily rental market.

"The inability to purchase properties at reasonable cap rates in the first nine months appears to have shifted as pension funds have withdrawn from B-plus and A-minus multifamily product," Crocker says. However, he adds capitalization rates for lower quality properties have only shifted slightly.

Equity Residential's 10 third-quarter sales totaling $109.7 million for 2,052 units ($53,460 per unit), were at an 8.6% cap rate. Meanwhile, the REIT's three purchases, totaling $55.1 million for 640 units ($86,094 per unit), were at a 7.7% cap rate. Already, Equity Residential has been able to buy a 296-unit property at an 8.3%-cap rate, for $23.7 million ($80,068 per unit) in the fourth quarter. However, its five sales so far this quarter were at a 9.5% cap rate, consisting of 636 units for $22.1 million ($34,748 per unit).