"The IRR in Jackson, MS is just as competitive as the IRR in SanFrancisco," Eric Bolton, chairman and CEO of Memphis-basedMid-America Apartment Communities Inc., told the audience at theBoca Raton Resort & Club. "You can compete just as well in theSoutheast as you can in larger gateway cities."

Bolton notes that secondary markets appear to have more stablefundamentals over the long term than the nation's largest cities,many of which were besieged with heavy job losses over the pastyear. This presents opportunities for apartment investors in localmarkets to purchase class B and C properties that most REITs mightnot be interested in pursuing.

Yet while finding discounted apartment complexes was relativelyeasy last year, those buying opportunities might be fewer in 2010."It appears a lot of the low-hanging fruit has been picked,"observed John Adair, principal of San Francisco-based PrimeGroup.