Though it’s been the poster child of distress the past few years, the Phoenix apartment market is starting to heat up.

In the past six months, there have been some aggressive trades in and around Phoenix, as more investors bank on a strong recovery in the battered market. And market research firms are backing up that optimism, forecasting significant rent growth over the next four years.

Consider that in 2008 and 2009, Phoenix was among the biggest casualties of the faltering economy. The area’s job market fell 5 percent in 2008 and another 7 percent in 2009, a net loss of more than 224,000 jobs, according to market-research firm Reis. But job growth, and rent growth, resumed last year at very modest levels. And Reis is now forecasting rent growth of 2.6 percent this year, and more than 3.5 percent annually out until 2015.

That strong pace of recovery jibes with what Kevin Colard, senior acquisitions manager for Kirkland, Wash.-based Weidner Apartment Homes, is seeing. Among its Arizona investments, Weidner has a 95-plus percent occupancy rate. “It will just be a matter of time before Phoenix is as strong as it was a few years ago,” Colard says. “Since March 2010, when we started buying the properties, we’ve already seen 10 percent growth in our income there.”

Indeed, Weidner has been bullish in its approach to Phoenix, entering the market via its March 2010 purchase of the 340-unit Trillium Villas in Peoria, Ariz., a $27.5 million all-cash transaction on a short sale from KeyBank. From there, the company went on a tear, and now owns about 2,600 units in Phoenix and another 500 units in Tucson.

A long-term holder with 27,000 units in its portfolio, Weidner isn’t necessarily driven by three- or five-year yields. “We were buying cap rates at 5.5 percent to 6 percent in Phoenix over the last year, but we’re buying Class A assets at $70,000 to $80,000 a door.” Colard says. “We’re not seeing Class A assets go for that pricing anywhere else in the country where we’re involved.”

Most recently, the company paid $46 million for the 768-unit Peaks at Papago Park, an off-market deal. The previous owners had some maturing CMBS debt on the property and needed to sell before the loan came due. The company estimates that price to be about 50 percent below replacement cost for the Class B asset, which sold at a 6.75 percent cap rate.

Weidner certainly isn’t alone in its enthusiasm. There has been a slew of activity in recent months by a diverse cadre of buyers. In December, AEW Capital Management purchased the Palladium, a 250-unit property in Scottsdale for $42.3 million, at a cap rate of 5.5 percent. LaSalle Investment Management purchased the 342-unit Shade Apartments in Phoenix for $42.7 million, at a cap rate of 5.8 percent, in the third quarter of 2010. And the 629-unit Canyons Luxury Apartment Community traded at a 5.1 percent cap rate when it was purchased for $45.5 million by Continental Realty Advisors—the company’s re-entrance to Phoenix after selling all of its properties there in early 2007.

And other investors have certainly taken note of the market’s improving fundamentals. “We haven’t done a deal in Phoenix in this cycle, but we are seeing significant market rent growth in Phoenix,” says Michael McNamara, head of acquisitions for Philadelphia-based TRECAP Partners, which owns more than 20,000 units. “We would look for a premium to be in Phoenix, but that’s a market we would consider.”