What a difference a year makes. After witnessing more than $1 billion in multifamily asset transactions in 2008, Portland, Ore., sales volume plummeted 78 percent last year to a comparatively meager $230 million, according to a year-end market report by Boston-based Colliers International.

The entire MSA for the so-called City of Roses boasts more than 2 million residents; major employers including Intel and Nike; an expected population growth of more than 60 percent over the next 50 years; and an urban growth boundary adopted in 1979 that strictly limits the development of new apartment stock. You’d think buyers would be clamoring for deal flow at any cost.

Not quite. In 2008, Portland clocked in the highest unemployment jump in the nation—a 6.9 percent increase outpacing Detroit (6.6 percent) and Charlotte, N.C. (6.4 percent), according to data from the U.S. Bureau of Labor Statistics. “You can almost point to the day 16 or 17 months ago when the whole metro went into recession,” says Colliers senior broker Beth DuPont. “The job loss and economic effects happened very quickly.” Not so quick were multifamily sellers, who stayed the pricing course in 2009 with cap rate expectations in the upper 5 percent range, despite actual transactions averaging a 6.8 cap for the year, largely paralleling a national average cap rate of 6.4 percent.

DuPont says those price expectations will mitigate in 2010 as market realities set in and owners are confronted with loan calls, deferred maintenance, and property taxes in an environment where falling rents are reducing available cash flow.

“This is really the year of decision for owners. They need to take a step back and get real about the operations and fundamentals of their properties as reflected in market valuation,” DuPont says. “This year we expect volume in transactions to pick up, and I also think we will significantly close the gap between buyers and sellers.”

If the interest of Behringer Harvard is any indication, Portland may have already begun its rebound. The Dallas-based real estate firm purchased the 16-story, 352-unit Cyan downtown tower late last December, with Behringer Harvard Multi-family REIT I chief operating officer Mark T. Alfieri noting that the deal was representative of a focus on markets positioned well for long-term rent growth and value appreciation. (Terms of the deal were undisclosed, and the transaction was not reflected in Colliers’ year-end numbers.)

“We’re getting daily calls from institutional investors, REITs, and large capital buyers,” DuPont says. “We are getting double digit offers. We have not seen that kind of action in two years. More and more investors are stepping into the action, looking to buy, but they are looking for properties that are priced to sell.”