CARLYLE REAL ESTATE LTD PARTNERSHIP XIII, 10-K405, 2000-03-30

CARLYLE REAL ESTATE LTD PARTNERSHIP XIII
10-K405, 2000-03-30
REAL ESTATE

Previous: AMERICAN REPUBLIC REALTY FUND I, 10-K, 2000-03-30

Next: ANGELES INCOME PROPERTIES LTD II, 10KSB, 2000-03-30

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

Annual Report Pursuant to Section 13 or 15(d)
of the Securities Act of 1934

For the fiscal year
ended December 31, 1999 Commission File Number 0-12791

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(Exact name of registrant as specified in its charter)

Illinois 36-3207212
(State of organization) (I.R.S. Employer Identification No.)

900 N. Michigan Ave., Chicago, Illinois 60611
(Address of principal executive office) (Zip Code)

Registrant's telephone number, including area code 312-915-1987

Securities registered pursuant to Section 12(b) of the Act:

Name of each exchange on
Title of each class which registered
- ------------------- ------------------------------

None None

Securities registered pursuant to Section 12(g) of the Act:

LIMITED PARTNERSHIP INTERESTS
(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [ X ] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K [ X ]

State the aggregate market value of the voting stock held by non-affiliates
of the registrant. Not applicable.

Documents incorporated by reference: None

<PAGE>

TABLE OF CONTENTS

Page
----
PART I

Item 1. Business . . . . . . . . . . . . . . . . . . . 1

Item 2. Properties . . . . . . . . . . . . . . . . . . 10

Item 3. Legal Proceedings. . . . . . . . . . . . . . . 10

Item 4. Submission of Matters to a Vote of
Security Holders . . . . . . . . . . . . . . . 10

PART II

Item 5. Market for the Partnership's Limited
Partnership Interests and Related
Security Holder Matters. . . . . . . . . . . . 11

Item 6. Selected Financial Data. . . . . . . . . . . . 12

Item 7. Management's Discussion and
Analysis of Financial Condition and
Results of Operations. . . . . . . . . . . . . 14

Item 7A. Quantitative and Qualitative Disclosures
about Market Risk. . . . . . . . . . . . . . . 18

Item 8. Financial Statements and
Supplementary Data . . . . . . . . . . . . . . 19

Item 9. Changes in and Disagreements
with Accountants on Accounting
and Financial Disclosure . . . . . . . . . . . 44

PART III

Item 10. Directors and Executive Officers
of the Partnership . . . . . . . . . . . . . . 44

Item 11. Executive Compensation . . . . . . . . . . . . 47

Item 12. Security Ownership of Certain
Beneficial Owners and Management . . . . . . . 48

Item 13. Certain Relationships and
Related Transactions . . . . . . . . . . . . . 49

PART IV

Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K. . . . . . . . . . . . 49

SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . 53

<PAGE>

PART I

ITEM 1. BUSINESS

Unless otherwise indicated, all references to "Notes" are to Notes to
Consolidated Financial Statements contained in this report. Capitalized
terms used herein, but not defined, have the same meanings as used in the
Notes.

The registrant, Carlyle Real Estate Limited Partnership-XIII (the
"Partnership"), is a limited partnership formed in late 1982 and currently
governed by the Revised Uniform Limited Partnership Act of the State of
Illinois to invest in improved income-producing commercial and residential
real property. The Partnership sold 366,177.57 limited partnership
interests (the "Interests") at $1,000 per Interest commencing on June 9,
1983, pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933 (Registration No. 2-81125 and No. 2-87033). The
offering closed on May 22, 1984. No holder of Interests (hereinafter,
"Holder" or "Holder of Interests") has made any additional capital
contribution after such date. The Holders of Interests share in their
portion of the benefits of ownership of the Partnership's real property
investments according to the number of Interests held.

The Partnership is engaged solely in the business of the acquisition,
operation and sale and disposition of equity real estate investments. Such
equity investments are or have been held by fee title, leasehold estates
and/or through joint venture partnership interests. The Partnership's real
estate investments were located throughout the nation and it has no real
estate investments located outside of the United States. A presentation of
information about industry segments, geographic regions, raw materials or
seasonality is not applicable and would not be material to an understanding
of the Partnership's business taken as a whole. Pursuant to the
Partnership Agreement, the Partnership is required to terminate no later
than December 31, 2033. The Partnership is self-liquidating in nature. At
sale of a particular property, the net proceeds, if any, are generally
distributed or reinvested in existing properties rather than invested in
acquiring additional properties. The Partnership currently has indirect
interests in 1290 Avenue of the Americas and 237 Park Avenue and a
portfolio of other investments.

In October 1994, the Partnership and its affiliated partners (together
with the Partnership, the "Affiliated Partners"), through JMB/NYC, entered
into an agreement (the "Agreement") with affiliates (the "Olympia & York
affiliates") of Olympia & York Developments, Ltd. ("O&Y") who were the
venture partners in the Joint Ventures that owned 237 Park Avenue, 1290
Avenue of the Americas and 2 Broadway Buildings, to resolve certain
disputes among the Affiliated Partners and the Olympia & York affiliates.
In general, the parties agreed to: (i) restructure the first mortgage
loan; (ii) sell the 2 Broadway Building; (iii) reduce or eliminate approval
rights of JMB/NYC with respect to virtually all property management,
leasing, sale or refinancing; (iv) amend the Joint Ventures' agreements to
eliminate any funding obligations by JMB/NYC and (v) establish a new
preferential cash distribution level for the Olympia & York affiliates. In
accordance with the Agreement and in anticipation of the sale of the 2
Broadway Building, the unpaid first mortgage indebtedness previously
allocated to 2 Broadway was allocated in 1994 to 237 Park Avenue and 1290
Avenue of the Americas Buildings.

As part of the Agreement, JMB/NYC and the Olympia & York affiliates
agreed to file a pre-arranged bankruptcy plan for reorganization under
Chapter 11 of the Bankruptcy Code in order to facilitate the restructuring
of the Joint Ventures between JMB/NYC and the Olympia & York affiliates and
the debt encumbering the two properties remaining after the sale of 2
Broadway. In June 1995, the 2 Broadway Joint Ventures filed their pre-
arranged bankruptcy plans for reorganization, and in August 1995, the
bankruptcy court entered an order confirming their plans of reorganization.

In September 1995, the sale of the 2 Broadway Building was completed. Such
sale did not result in any distributable proceeds to JMB/NYC or the Olympia
and York affiliates.

<PAGE>

Bankruptcy filings for the Joint Ventures owning the 237 Park Avenue
and 1290 Avenue of the Americas properties were made in April 1996, and in
August 1996, an Amended Plan of Reorganization and Disclosure Statement
(the "Plan") was filed with the Bankruptcy Court for these Joint Ventures.
The Plan was accepted by the various classes of debt and equity holders and
confirmed by the Court on September 20, 1996 and became effective
October 10, 1996 ("Effective Date").

Prior to the restructuring in 1999 discussed below, the Plan provided
that JMB/NYC had an indirect limited partnership interest which, before
taking into account significant preferences to other partners, equals
approximately 4.9% of the reorganized and restructured ventures owning 237
Park and 1290 Avenue of the Americas (the "Properties"). Neither O&Y nor
any of its affiliates had any direct or indirect continuing interest in the
Properties. The new ownership structure gave control of the Properties to
an unaffiliated real estate investment trust ("REIT") owned primarily by
holders of the first mortgage debt that encumbered the Properties prior to
the bankruptcy. JMB/NYC had, under certain limited circumstances, through
January 1, 2001 rights of consent regarding sale of the Properties or the
consummation of certain other transactions that significantly reduced
indebtedness of the Properties. In general, at any time on or after
January 2, 2001, an affiliate of the REIT had the right to purchase
JMB/NYC's interest in the Properties for an amount relating to the
operations of the Properties (the "Formula Price"). In addition, the
purchase money note made by JMB/NYC for its interest in the Properties,
which had outstanding principal and accrued and deferred interest of
approximately $133,148,000 at December 31, 1999, matures on January 2,
2001. If such REIT affiliate exercised such right to purchase, due to the
level of indebtedness remaining on the Properties, the purchase money note
payable by JMB/NYC, and the significant preference levels to the other
partners within the reorganized structure of the joint ventures owning the
Properties, it was unlikely that such purchase would result in payment of
any significant amount to JMB/NYC. Additionally, at any time, JMB/NYC had
the right to require such REIT affiliate to purchase the interest of
JMB/NYC in the Properties for the Formula Price.

The restructuring and reorganization discussed above eliminated any
potential additional obligation of the Partnership in the future to provide
additional funds under its previous joint venture agreements (other than
that related to a certain indemnification agreement provided in connection
with such restructuring).

In 1996, the Affiliated Partners entered into a joint and several
obligation to indemnify the REIT to the extent of $25 million to ensure
their compliance with the terms and conditions relating to JMB/NYC's
indirect limited partnership interest in the restructured and reorganized
joint ventures that own the Properties. The Affiliated Partners
contributed approximately $7.8 million (of which the Partnership's share
was approximately $1.9 million) to JMB/NYC, which was deposited into an
escrow account as collateral for such indemnification. These funds have
been invested in stripped U.S. Government obligations with a maturity date
of February 15, 2001. Due to the Restructuring discussed below, the
maximum potential obligation has been reduced to $14,285,000 and a portion
of the collateral was released in 1999 to JMB/NYC. The Partnership's share
of the reduction of the maximum unfunded obligation under the
indemnification agreement recognized as income is a result of interest
earned on amounts contributed by the Partnership and held in escrow by
JMB/NYC and, in 1999, the agreed upon reduction of the maximum obligation.
Interest income earned reduces the Partnership's share of the maximum
unfunded obligation under the indemnification agreement, which is reflected
as a liability in the accompanying financial statements.

<PAGE>

In November 1999, JMB/NYC closed a transaction (the "Restructuring")
pursuant to which, among other things, JMB/NYC's interests in 237 Park
Avenue ("237 Park") and 1290 Avenue of the Americas ("1290 Avenue of the
Americas") were restructured. Under the Restructuring, the partnership
that owns 237 Park has been converted to a limited liability company ("237
Park LLC"). The membership interest in 237 Park LLC owned by 237/1290
Upper Tier Associates, L.P. (the "Upper Tier Partnership"), in which
JMB/NYC is a limited partner with a 99% interest, was contributed to a
partnership (the "237 Partnership") that acquired the other membership
interests in 237 Park LLC from the REIT and one of its affiliates. In
exchange for the interest in 237 Park LLC, the Upper Tier Partnership
received a limited partnership interest in the 237 Partnership having a
fair market value (determined in accordance with the partnership agreement
of the 237 Partnership) of approximately $500,000. (JMB/NYC's total
investment in the 237 Partnership is significantly less than 1% of the 237
Partnership.) The 237 Partnership owns a portfolio of investments in
addition to 237 Park. JMB/NYC has the right, during the month of July of
each calendar year commencing with 2001, to cause a sale of the interest in
the 237 Partnership for a price equal to the greater of the fair market
value of such interest (determined in accordance with the partnership
agreement of the 237 Partnership) and a specified amount, of which
JMB/NYC's share would be $500,000. In addition, the general partner of the
237 Partnership has the right, during the month of January of each calendar
year commencing with 2002, to purchase the interest in the 237 Partnership
for a price equal to the greater of the fair market value of such interest
(determined as described above) and a specified amount, of which JMB/NYC's
share would be $650,000.

Although under the terms of the Restructuring JMB/NYC is not able to
cause a sale of the interest in the 237 Partnership prior to 2001, the
earliest date on which such interest may be purchased at the election of
the general partner of the 237 Partnership is January 2002. In the absence
of JMB/NYC's earlier election to cause a sale of its interest in the 237
Partnership, this extends by a year (to January 2002 from January 2001) the
date on which JMB/NYC's indirect interest in 237 Park was previously
subject to purchase at the election of an affiliate of the REIT.

JMB/NYC's indirect interest through the Upper Tier Partnership in the
partnership (the "1290 Partnership") that owns 1290 Avenue of the Americas
was also modified, although the REIT continues to own the controlling
interest in the property. In general, the REIT has the right to sell 1290
Avenue of the Americas or the REIT's interest in the 1290 Partnership or
permit a sale of more than 51% of the stock in the REIT, during the period
January 1, 2000 through February 28, 2001, provided that JMB/NYC receives
the greater of (i) an amount based on a formula relating to the operations
of the property (the "1290 Formula Price") and (ii) $4,500,000. Although
the REIT is able to cause a sale of the entire property one year earlier
than previously which would result in the Partnership's (and the Holders of
Interests') recognition of income for Federal income tax purposes from such
a transaction, JMB/NYC would be entitled to receive a minimum specified
amount (determined as described above) in connection with such sale. An
affiliate of the REIT also has the right, during the month of March of each
calendar year commencing with 2001, to purchase JMB/NYC's indirect interest
in the property for the greater of (x) the 1290 Formula Price and (y)
$1,400,000. In addition, JMB/NYC has the right, during the month of
September of each calendar year commencing with 2001, to require an
affiliate of the REIT to purchase JMB/NYC's indirect interest in the
property for the greater of (1) the 1290 Formula Price, and (2) $1,000,000.

<PAGE>

In connection with the above transactions, approximately $4,460,000 in
face amount at maturity of U.S. Treasury securities held as collateral for
the indemnification obligations of the Affiliated Partners was released
from escrow and returned to the Affiliated Partners. The remaining face
amount of the securities will be held as collateral for the indemnification
obligations for the Affiliated Partners relating to 1290 Avenue of the
Americas generally until 90 days after the earlier of the sale of 1290
Avenue of the Americas and the sale of JMB/NYC's indirect interest in 1290
Avenue of the Americas. The Partnership expects its share of the remaining
collateral, including interest earned thereon, to be returned after the
termination of the indemnification obligations.

While the Partnership is not expected to terminate in the near term,
it currently appears unlikely that any significant distributions will be
made to the Partnership at any time due to, among other things, the level
of indebtedness on 1290 Avenue of the Americas, the purchase money note
payable by JMB/NYC and the significant preference levels for the other
partners within the reorganized joint venture owning 1290 Avenue of the
Americas.

The Partnership has made the real property investments set forth in
the following table:

<PAGE>

SALE OR DISPOSITION
DATE OR IF OWNED
AT DECEMBER 31, 1999,
NAME, TYPE OF PROPERTY DATE OF ORIGINAL INVESTED
AND LOCATION SIZE PURCHASE CAPITAL PERCENTAGE (a) TYPE OF OWNERSHIP (b)
- ---------------------- ---------- -------- ---------------------- ---------------------
<S> <C> <C> <C> <C>
1. Copley Place
multi-use complex
Boston,
Massachusetts. . . 1,220,000
sq.ft. 9/1/83 1/23/97 fee ownership of improve-
n.r.a. ments and leasehold
interest in air rights
(through joint venture
partnership) (e)
2. 1001 Fourth Avenue
Plaza
office building
Seattle,
Washington . . . . 678,000
sq.ft. 9/1/83 11/1/93 fee ownership of land and
n.r.a. improvements
3. First Tennessee
Plaza
(Plaza Tower)
office building
Knoxville,
Tennessee. . . . . 418,000
sq.ft. 10/26/83 9/19/97 fee ownership of land and
n.r.a. improvements (e)
4. Gables Corporate
Plaza
office building
Coral Gables,
Florida. . . . . . 106,000
sq.ft. 11/15/83 1/5/94 fee ownership of land and
n.r.a. improvements (through joint
venture partnership)
5. University Park
office building
Sacramento,
California . . . . 120,000
sq.ft. 1/16/84 1/10/94 fee ownership of land and
n.r.a. improvements

<PAGE>

6. Sherry Lane Place
office building
Dallas, Texas. . . 286,000
sq.ft. 12/1/83 9/12/97 fee ownership of land and
n.r.a. improvements (through joint
venture partnerships)(e)
7. Allied Automotive
Center
Southfield,
Michigan . . . . . 192,000
sq.ft. 3/30/84 10/10/90 fee ownership of land and
n.r.a. improvements (e)
8. Commercial Union
Building
Quincy,
Massachusetts. . . 172,000
sq.ft. 3/12/84 8/15/91 fee ownership of land and
n.r.a. improvements
9. 237 Park Avenue
Building
New York,
New York . . . . . 1,140,000
sq.ft. 8/14/84 (h) (i) fee ownership of land and
n.r.a. improvements (through joint
venture partnerships)
(c)
10. 1290 Avenue of
the Americas
Building
New York,
New York . . . . . 2,000,000
sq.ft. 7/27/84 (h) fee ownership of land and
n.r.a. improvements (through joint
venture partnerships)
(c)
11. 2 Broadway
Building
New York,
New York . . . . . 1,600,000
sq.ft. 8/14/84 9/18/95 fee ownership of land and
n.r.a. improvements (through joint
venture partnerships)
(c)(e)

<PAGE>

12. Long Beach Plaza
shopping center
Long Beach,
California . . . . 559,000
sq.ft. 6/22/83 12/31/98 fee ownership of land and
g.l.a. improvements and leasehold
interest in the parking
structure (d)(f)
13. Michael's (Marshall's)
Aurora Plaza
shopping center
Aurora (Denver),
Colorado . . . . . 123,000
sq.ft. 4/1/83 10/15/97 fee ownership of land and
g.l.a. improvements (e)
14. Old Orchard
shopping center
Skokie (Chicago),
Illinois . . . . . 843,000
sq.ft. 4/1/84 8/30/93 fee ownership of land and
g.l.a. improvements (through a
joint venture partnership)
(g)
15. Heritage Park-II
Apartments
Oklahoma City,
Oklahoma . . . . . 244 units 7/1/83 3/26/92 fee ownership of land and
improvements (through a
joint venture partnership)
16. Quail Place
Apartments
Oklahoma City,
Oklahoma . . . . . 180 units 7/1/83 3/26/92 fee ownership of land and
improvements (through a
joint venture partnership)
17. Lake Point
Apartments
Charlotte,
North Carolina . . 208 units 9/15/83 12/29/89 fee ownership of land and
improvements

<PAGE>

18. Eastridge
Apartments
Tucson, Arizona. . 456 units 8/23/83 6/30/94 fee ownership of land and
improvements (through a
joint venture partnership)
19. Rio Cancion
Apartments
Tucson, Arizona. . 380 units 8/18/83 3/31/93 fee ownership of land and
improvements
20. Bridgeport
Apartments
Irving, Texas. . . 312 units 9/30/83 4/2/92 fee ownership of land and
improvements
21. Carrollwood Station
Apartments
Tampa, Florida . . 336 units 12/16/83 3/2/98 fee ownership of land and
improvements (through a
joint venture partnership)
(e)
22. Greenwood Creek II
Apartments
Benbrook
(Fort Worth),
Texas. . . . . . . 152 units 3/30/84 4/6/93 fee ownership of land and
improvements
23. The Glades
Apartments
Jacksonville,
Florida . . . . . 360 units 10/9/84 11/21/96 fee ownership of land and
improvements (through a
joint venture partnership)

<PAGE>

<FN>
- -----------------------

(a) The computation of this percentage for properties held at
December 31, 1999 does not include amounts invested from sources other than
the original net proceeds of the public offering as described above and in
Item 7.

(b) Reference is made to the Notes filed with this annual report for a
description of the long-term mortgage indebtedness that had been secured by
certain of the Partnership's real property investments.

(c) Reference is made to the Notes for a description of the joint
venture partnership or partnerships through which the Partnership made this
real property investment.

(d) Reference is made to the Notes for a description of the leasehold
interest in the land on which a portion of this real property investment
had been situated.

(e) This property or the Partnership's interest in this property has
been sold. Reference is made to the Notes for a description of the sale of
such real property investment.

(f) This property has been disposed of. Reference is made to the
Notes for a description of such transaction.

(g) The venture sold its interest in the property. Reference is made
to the Notes.

(h) The original invested capital percentage for the 237 Park Avenue
Building and the 1290 Avenue of the Americas Building was 4% and 8%,
respectively. Reference is made to the Notes for a description of the
reorganization and restructuring of the Partnership's indirect interests in
these investment properties.

(i) As a result of the restructuring that occurred in 1999, the
Partnership owns through JMB/NYC an indirect interest in 237 Park Avenue
and certain other investments. Reference is made to the Notes for a
description of such transaction.

</TABLE>

<PAGE>

The Partnership has no employees.

The terms of transactions between the Partnership, the General
Partners and their affiliates are set forth in Item 11 below to which
reference is hereby made for a description of such terms and transactions.

ITEM 2. PROPERTIES

As a result of the restructuring that occurred in 1999, the
Partnership owns through JMB/NYC (i) an indirect interest in 1290 Avenue of
the Americas, and (ii) an indirect interest in 237 Park Avenue and certain
other investments.

The following is certain information concerning 237 Park Avenue and
1290 Avenue of the Americas.

PROPERTY AND LOCATION NET RENTABLE AREA

237 Park Avenue Building 1,140,000 square feet
New York, New York

1290 Avenue of the Americas Building 2,000,000 square feet
New York, New York

ITEM 3. LEGAL PROCEEDINGS

The Partnership is not subject to any material pending legal
proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There were no matters submitted to a vote of security holders during
1998 and 1999.

<PAGE>

PART II

ITEM 5. MARKET FOR THE PARTNERSHIP'S LIMITED PARTNERSHIP INTERESTS
AND RELATED SECURITY HOLDER MATTERS

As of December 31, 1999, there were 37,966 record holders of the
365,104.02298 Interests outstanding in the Partnership. There is no public
market for Interests and it is not anticipated that a public market for
Interests will develop. Upon request, the Corporate General Partner may
provide information relating to a prospective transfer of Interests to an
investor desiring to transfer his Interests. The price to be paid for the
Interests, as well as any other economic aspects of the transaction, will
be subject to negotiation by the investor. There are certain conditions
and restrictions on the transfer of Interests, including, among other
things, the requirement that the substitution of a transferee of Interests
as a Limited Partner of the Partnership be subject to the written consent
of the Corporate General Partner, which may be granted or withheld in its
sole and absolute discretion. The rights of a transferee of Interests who
does not become a substituted Limited Partner will be limited to the rights
to receive his share of profits or losses and cash distributions from the
Partnership, and such transferee will not be entitled to vote such
Interests or have other rights of a Limited Partner. No transfer will be
effective until the first day of the next succeeding calendar quarter after
the requisite transfer form satisfactory to the Corporate General Partner
has been received by the Corporate General Partner. The transferee
consequently will not be entitled to receive any cash distributions or any
allocable share of profits or losses for tax purposes until such next
succeeding calendar quarter. Profits or losses from operations of the
Partnership for a calendar year in which a transfer occurs will be
allocated between the transferor and the transferee based upon the number
of quarterly periods in which each was recognized as the Holder of the
Interests, without regard to the results of the Partnership's operations
during particular quarterly periods and without regard to whether cash
distributions were made to the transferor or transferee. Profits or losses
arising from the sale or other disposition of Partnership properties will
be allocated to the recognized Holder of the Interests as of the last day
of the quarter in which the Partnership recognized such profits or losses.
Cash distributions to a Holder of Interests arising from the sale or other
disposition of Partnership properties will be distributed to the recognized
Holder of the Interests as of the last day of the quarterly period with
respect to which such distribution is made.

Reference is made to Item 6 below for a discussion of cash distribu-
tions made to the Holders of Interests. Reference is made to the Notes for
a discussion of the provisions of the Partnership Agreement relating to
cash distributions. It currently appears unlikely that any significant
distributions will be made by the Partnership due to, among other things,
the level of indebtedness on 1290 Avenue of the Americas, the preference
levels to other partners within the reorganized joint venture owning 1290
Avenue of the Americas, and the purchase money note payable by JMB/NYC,
which requires payment of principal and interest out of distributions
payable to JMB/NYC by the Partnerships in which it has interests.

<PAGE>

<TABLE>
ITEM 6. SELECTED FINANCIAL DATA

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

DECEMBER 31, 1999, 1998, 1997, 1996 AND 1995

(NOT COVERED BY INDEPENDENT AUDITORS' REPORT)

<CAPTION>
1999 1998 1997 1996 1995
------------- ------------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Total income. . . . . . . . $ 300,152 5,173,967 16,941,329 69,093,943 66,763,349
============ ============ ============ ============ ============
Earnings (loss) before
gains on sale or disposi-
tion of securities,
investment properties
or interest in invest-
ment property. . . . . . . $ 2,286,026 (4,612,001) (5,592,268) 42,099,222 (25,732,699)
Gains (losses) on sale
or disposition of
securities, investment
properties or interest
in investment property,
net of venture partners'
share of $14,492,690
in 1997 and ($329,169)
in 1996. . . . . . . . . . 980,945 5,365,511 96,019,552 5,484,249 --
Partnership's share
of gains (losses) on sale
of property or
interest in
property of
unconsolidated
ventures . . . . . . . . . -- -- -- -- (14,789,529)
------------ ------------ ------------ ------------ ------------
Earnings (loss) before
extraordinary items. . . . 3,266,971 753,510 90,427,284 47,583,471 (40,522,228)
Extraordinary items . . . . (1,121,200) 47,015,485 55,468,888 -- 15,632,407
------------ ------------ ------------ ------------ ------------
Net earnings
(loss) . . . . . . . . . . $ 2,145,771 47,768,995 145,896,172 47,583,471 (24,889,821)
============ ============ ============ ============ ============

<PAGE>

1999 1998 1997 1996 1995
------------- ------------ ----------- ------------ ------------
Net earnings (loss) per
Interest (b):
Earnings (loss) before
gains on sale or
disposition of securities,
investment properties or
interest in investment
property . . . . . . . . $ 6.01 (12.12) (14.67) 110.42 (67.47)
Gains (losses) on sale
or disposition of
securities, investment
properties or interest
in investment
property . . . . . . . . 2.66 14.54 259.75 14.83 --
Partnership's share
of gains (losses)
on sale of property
or interest in
property of
unconsolidated
ventures . . . . . . . . -- -- -- -- (39.99)
Extraordinary items . . . (3.04) 74.92 150.05 -- 42.27
------------ ------------ ------------ ------------ ------------
Net earnings (loss) . . . $ 5.63 77.34 395.13 125.25 (65.19)
============ ============ ============ ============ ============
Total assets. . . . . . . . $ 2,669,876 4,035,478 27,600,886 280,595,580 307,460,106
Long-term debt. . . . . . . $ -- 1,667,340 1,479,679 384,098,834 382,303,505
Cash distributions
per Interest (b) . . . . . $ -- 30.00 25.00 -- 30.00
============ ============ ============ ============ ============
<FN>
- -------------

(a) The above selected financial data should be read in conjunction with the consolidated financial
statements and the related notes appearing elsewhere in this annual report.

(b) Cash distributions from the Partnership are generally not equal to Partnership income (loss) for
financial reporting or Federal income tax purposes. Each Partner's taxable income or (loss) from the Partnership
in each year is equal to his allocable share of the taxable income (loss) of the Partnership, without regard to
the cash generated or distributed by the Partnership. Accordingly, cash distributions to the Holders of Interests
since the inception of the Partnership have not resulted in taxable income to such Holders of Interests and have
therefore represented a return of capital.

</TABLE>

<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

As a result of the public offering of Interests as described in
Item 1, the Partnership had approximately $326,000,000 (after deducting
selling expenses) and other offering costs with which to make investments
in income-producing commercial and residential real property, to pay legal
fees and other costs (including acquisition fees) related to such invest-
ments and to satisfy working capital requirements. A portion of the
proceeds was utilized to acquire the properties described in Item 1 above.

At December 31, 1999, the Partnership had cash and cash equivalents of
approximately $2,523,000. These funds are available for working capital
requirements and reserves and potential future distributions to the General
Partners and Holders of Interests.

The Partnership does not consider its indirect interest in JMB/NYC to
be a significant source of liquidity. However, in the fourth quarter of
1999, the Partnership received approximately $1,037,000, which represented
a partial return of its share of the funds held in escrow (including
interest earned) as collateral under the indemnification agreement as
discussed below. The Partnership expects to receive the remainder of its
share of the funds held in escrow (including accrued interest) after
termination of such agreement. Reference is made to the Partnership's
property-specific discussion of JMB/NYC in the Notes.

In December 1999, the Partnership reached an agreement with the seller
of the Long Beach investment property for the retirement of the promissory
note payable in the amount of $10,000,000 originally due in 2013 and 2014
to the seller in connection with the acquisition of the property by the
Partnership in 1983. The terms of the agreement provided for full
satisfaction of the loan in exchange for a payment of $3,000,000. On
December 22, 1999, the Partnership remitted this payment to the seller and
received a full release of all obligations related to the loan. In 1984,
the Partnership purchased certain government securities to help offset the
$10,000,000 obligation due in 2013 and 2014. The Partnership sold these
marketable securities (with a market value of approximately $2,535,000 and
a carrying value of $1,559,000) and used the proceeds to make the payment,
with the remainder of approximately $465,000 funded from available cash
held by the Partnership.

The Partnership had suspended operating cash distributions to the
Holders of Interests and General Partners effective as of the first quarter
of 1992.

In November 1999, JMB/NYC closed a transaction (the "Restructuring"),
pursuant to which, among other things, JMB/NYC's interests in 237 Park
Avenue ("237 Park") and 1290 Avenue of the Americas ("1290 Avenue of the
Americas") were restructured. Under the Restructuring, the partnership
that owns 237 Park would be converted to a limited liability company ("237
Park LLC"). The membership interest in 237 Park LLC owned by 237/1290
Upper Tier Associates, L.P. (the "Upper Tier Partnership"), in which
JMB/NYC is a limited partner with a 99% interest, was contributed to a
partnership (the "237 Partnership") that acquired the other membership
interests in 237 Park LLC from the REIT and one of its affiliates. In
exchange for the interest in 237 Park LLC, the Upper Tier Partnership
received a limited partnership interest in the 237 Partnership having a
fair market value (determined in accordance with the partnership agreement
of the 237 Partnership) of approximately $500,000. (JMB/NYC's total
investment in the 237 Partnership is significantly less than 1% of the 237
Partnership.) The 237 Partnership owns a portfolio of investments in
addition to 237 Park. JMB/NYC has the right, during the month of July of
each calendar year commencing with 2001, to cause a sale of the interest in
the 237 Partnership for a price equal to the greater of the fair market
value of such interest (determined in accordance with the partnership
agreement of the 237 Partnership) and a specified amount, of which
JMB/NYC's share would be $500,000. In addition, the general partner

<PAGE>

of the 237 Partnership has the right, during the month of January of each
calendar year commencing with 2002, to purchase the interest in the 237
Partnership for a price equal to the greater of the fair market value of
such interest (determined as described above) and a specified amount, of
which JMB/NYC's share would be $650,000.

The Restructuring, by itself, of JMB/NYC's indirect interest in 237
Park did not result in the Partnership's (or the Holders of Interests')
recognizing any income for Federal income tax purposes. In addition,
although under the terms of the Restructuring JMB/NYC is not able to cause
a sale of the interest in the 237 Partnership prior to 2001, the earliest
date on which such interest could be purchased at the election of the
general partner of the 237 Partnership is January 2002. In the absence of
JMB/NYC's earlier election to cause a sale of its interest in the 237
Partnership, this extends by a year (to January 2002 from January 2001)
the date on which JMB/NYC's indirect interest in 237 Park was previously
subject to purchase at the election of an affiliate of the REIT.

JMB/NYC's indirect interest through the Upper Tier Partnership in the
Partnership (the "1290 Partnership") that owns 1290 Avenue of the Americas
would also be modified, although the REIT continues to own the controlling
interest in the property. In general, the REIT has the right to sell 1290
Avenue of the Americas or the REIT's interest in the 1290 Partnership or
permit a sale of more than 51% of the stock in the REIT, during the period
January 1, 2000 through February 28, 2001, provided that JMB/NYC receives
the greater of (i) an amount based on a formula relating to the operations
of the property (the "1290 Formula Price"), and (ii) $4,500,000. Although
the REIT is able to cause a sale of the entire property one year earlier
than previously, which would result in the Partnership's (and the Holders
of Interests') recognition of income for Federal income tax purposes from
such a transaction, JMB/NYC would be entitled to receive a minimum
specified amount (determined as described above) in connection with such
sale. An affiliate of the REIT also has the right, during the month of
March of each calendar year commencing with 2001, to purchase JMB/NYC's
indirect interest in the 1290 Partnership for the greater of (x) the 1290
Formula Price and (y) $1,400,000. In addition, JMB/NYC has the right,
during the month of September of each calendar year commencing with 2001,
to require an affiliate of the REIT to purchase JMB/NYC's indirect interest
in the 1290 Partnership for the greater of (1) the 1290 Formula Price, and
(2) $1,000,000.

A portion of the purchase price for JMB/NYC's interest in the 1290
Avenue of the Americas and 237 Park Avenue office buildings is represented
by a promissory note (the "Purchase Note") bearing interest at 12-3/4% per
annum. The Purchase Note is secured by JMB/NYC's indirect interest in the
1290 Partnership and the 237 Partnership and is non-recourse to JMB/NYC.
Prior to maturity, the Purchase Note requires payment of principal and
interest out of distributions made to JMB/NYC from the 1290 Partnership and
the 237 Partnership. Unpaid interest accrues and is deferred, compounded
monthly. Unpaid principal and interest are due at maturity on January 2,
2001, and it is not expected that JMB/NYC will have funds to pay the
Purchase Note at maturity. The outstanding principal and accrued and
deferred interest on the Purchase Note at December 31, 1999, was
approximately $133,148,000.

In December 1999, the Affiliated Partners advanced a total of
approximately $425,000 (of which the Partnership advanced approximately
$105,000) to the limited partners of JMB/NYC, which was used to acquire a
$5,425,000 tranche of the Purchase Note and the related security agreement
for the collateralization of such tranche. As a result of this purchase,
such limited partners, as creditors of JMB/NYC, are entitled to receive up
to $5,425,000 in proceeds otherwise payable to JMB/NYC in respect of its
indirect interest in the 1290 Partnership or the 237 Partnership. Such
amounts received by the limited partners will be distributed to the
Affiliated Partners in proportion to their respective advances made to
purchase the tranche (i.e., 25% to the Partnership and 75% in the aggregate
to the other Affiliated Partners).

<PAGE>

Also in December 1999, JMB/NYC was entitled to receive refinancing
proceeds, as defined, of approximately $446,000 in respect of its indirect
interest in the 1290 Partnership as a result of a refinancing of the
mortgage note secured by the 1290 Avenue of Americas office building.
These proceeds were used by JMB/NYC to make a payment of approximately
$443,000 on the Purchase Note tranche held by the limited partners. It is
expected that the limited partners will repay the Partnership's $105,000
advance in 2000.

In connection with the Restructuring, approximately $4,460,000 in face
amount at maturity of U.S. Treasury securities held as collateral for the
indemnification obligations of the Affiliated Partners was released from
escrow and returned to the Affiliated Partners (of which approximately
$1,027,000 was distributed to the Partnership). The remaining face amount
of the securities will be held as collateral for the indemnification
obligations of the Affiliated Partners relating to 1290 Avenue of the
Americas generally until 90 days after the earlier of the sale of 1290
Avenue of the Americas and the sale of JMB/NYC's indirect interest in 1290
Avenue of the Americas. The Partnership expects its share of the remaining
collateral, including interest earned thereon, to be returned after
termination of the indemnification obligations.

Due, among other things, to the level of indebtedness remaining on
1290 Avenue of the Americas, the Purchase Note payable by JMB/NYC and the
significant preference levels to other partners within the 1290
Partnership, it is unlikely that the Partnership will receive any
significant distributions from JMB/NYC or be able to make any significant
distributions to the Holders Of Interests. However, in connection with
sales or other dispositions of 1290 Avenue of the Americas or 237 Park
Avenue or of the Partnership's (or JMB/NYC's) interest in those properties,
Holders of Interests will recognize a substantial amount of net gain for
Federal income tax purposes (corresponding at a minimum to all or most of
their deficit capital account balances for tax purposes) even though the
Partnership would not be able to make any significant amounts of
distributions. For certain Holders of Interests such taxable income may be
offset by their suspended passive activity losses (if any). Each Holder's
tax consequences will depend on his own tax situation.

RESULTS OF OPERATIONS

Significant fluctuations between periods in the accompanying
consolidated financial statements are primarily the result of the
disposition of Long Beach Plaza in December 1998, the sale of the
Partnership's interest in Carrollwood Station Associates in March 1998, the
sale of the Partnership's interest in the Copley Place multi-use complex in
January 1997, the sales of the Sherry Lane Place and First Tennessee Office
Building in September 1997, and the sale of Michael's (Marshall's) Aurora
Plaza in October 1997. Reference is made to the Notes in the accompanying
consolidated financial statements for discussions of the sales.

The decrease in short term investments, interest, rents and other
receivables and related decrease in long-term debt at December 31, 1999 as
compared to December 31, 1998 is primarily due to the sale of securities
held by the Partnership. The proceeds from such sale were used to retire
the note payable (with a maturity value of $10,000,000) to the seller of
the Long Beach investment property to the Partnership in December, 1999.
Reference is made to the Notes for a description of such transaction.

Distributions received in excess of recorded investment at
December 31, 1999 is a result of the distribution by Carlyle Managers, Inc.
and Carlyle Investors, Inc. of the notes related to the Partnership's
obligations to fund on demand additional paid in capital to such
corporations. These obligations were reduced and, subsequently, fully
retired in October 1999.

<PAGE>

The decrease in interest income for the year ended December 31, 1999 as
compared to the year ended December 31, 1998 and the decrease in interest
income for the year ended December 31, 1998 as compared to the year ended
December 31, 1997 are primarily due to lower average balances in short term
investments in 1999 and 1998 as a result of the payments of previously
deferred property management and leasing fees and distributions to Holders
of Interests of sale proceeds.

The dividend income for the year ended December 31, 1999 is due to
dividends paid by Carlyle Investors, Inc. and Carlyle Managers, Inc. to the
Partnership (as a shareholder of both corporations) as a result of amounts
distributed by JMB/NYC related to the escrow refund discussed above.

The decrease in other income for the year ended December 31, 1999 as
compared to the year ended December 31, 1998 and the increase in other
income for the year ended December 31, 1998 as compared to the year ended
December 31, 1997 is primarily due to the 1998 sale of stock which was
received in a settlement of claims against a tenant in bankruptcy. The
claim originated from the Partnership's interest in the Old Orchard Venture
prior to its being sold in August 1993.

The decrease in professional services and general and administrative
expenses for the year ended December 31, 1999 as compared to the years
ended December 31, 1998 and 1997 is primarily due to the Partnership
incurring fewer administrative costs due to the sales of the Partnership's
investments discussed above.

The increase in the Partnership's share of the reduction of the
maximum unfunded obligation under the indemnification agreement for the
year ended December 31, 1999 as compared to the years ended December 31,
1998 and 1997 is primarily due to the restructuring of the Partnership's
indirect interest in 237 Park. As a result of such restructuring, the
Partnership was released from a portion of its obligations under the
indemnification agreement. Reference is made to the discussion of JMB/NYC
in the Notes for further information concerning this transaction.

The gain on sale or disposition of securities, investment properties
or interest in investment property, net of venture partner's share, of
$980,945 for the year ended December 31, 1999 is due to the sale of
securities held by the Partnership. Such gain of $5,365,511 for the year
ended December 31, 1998 consists of gain related to the sale of the
Partnership's interest in Carrollwood Station Associates. The gain on sale
or disposition of investment properties, net of venture partners' share, of
$96,019,552 for the year ended December 31, 1997 consists of gain of
$71,276,721 related to the sale of the interest in Copley Place multi-use
complex, a gain of $541,792 related to the sale of land at the Allied
Automotive Center, a gain of $18,174,417 related to the sale of Sherry Lane
Place Office Building, a gain of $5,207,750 related to the sale of the
First Tennessee Plaza Office Building and a gain of $818,872 related to the
sale of Michael's Aurora Plaza.

The extraordinary item of $1,121,200 for the year ended December 31,
1999 is due to a loss on the extinguishment of debt in 1999 related to the
early retirement of the note payable to the seller of Long Beach property.
The extraordinary item of $47,015,485 for the year ended December 31, 1998
consists of the forgiveness of principal and accrued but unpaid interest by
the lender at the time of disposition of the Long Beach Plaza. The
extraordinary items of $55,468,888 for the year ended December 31, 1997
consists of the forgiveness of indebtedness of $55,183,784 on the purchase
price note payable to an affiliate in connection with the sale of the
interest in the Copley Place multi-use complex, and the write off of
unamortized deferred mortgage expense of $285,104 resulting from the sales
of the Sherry Lane Place Office Building and the First Tennessee Plaza
Office Building.

<PAGE>

INFLATION

Due to the decrease in the level of inflation in recent years,
inflation generally has not had a material effect on rental income or
property operating expenses.

Inflation is not expected to significantly impact future operations of
the Partnership.

YEAR 2000

The Partnership has not experienced any material disruption in its
operations in connection with the century change and does not expect any
such disruption in the future. The Partnership has not needed to implement
contingency plans, has not had any material remediation costs and does not
anticipate that its future costs of remediation will be material. However,
there can be no assurance that disruption may not occur in the future or
that the cost of any required remediation may not be material.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Partnership does not believe that it is exposed to market risk
relating to interest rate changes.

<PAGE>

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)

AND CONSOLIDATED VENTURES

INDEX

Independent Auditors' Report

Consolidated Balance Sheets, December 31, 1999 and 1998

Consolidated Statements of Operations, years ended December 31,
1999, 1998 and 1997

Consolidated Statements of Partners' Capital Accounts (Deficits),
years ended December 31, 1999, 1998 and 1997

Consolidated Statements of Cash Flows, years ended December 31,
1999, 1998 and 1997

Notes to Consolidated Financial Statements

SCHEDULES NOT FILED:

All schedules have been omitted as the required information is
inapplicable or the information is presented in the consolidated financial
statements or related notes.

<PAGE>

INDEPENDENT AUDITORS' REPORT

The Partners
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII:

We have audited the consolidated financial statements of Carlyle Real
Estate Limited Partnership - XIII, a limited partnership, (the
Partnership), and consolidated ventures as listed in the accompanying
index. These consolidated financial statements are the responsibility of
the General Partners of the Partnership. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by the General Partners of the
Partnership, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.

In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial position of
the Partnership and consolidated ventures at December 31, 1999 and 1998,
and the results of their operations and their cash flows for each of the
years in the three-year period ended December 31, 1999, in conformity with
generally accepted accounting principles.

KPMG LLP

Chicago, Illinois
March 20, 2000

<PAGE>

<TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 1999 AND 1998

ASSETS
------
<CAPTION>
1999 1998
------------ -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . $ 2,523,388 2,577,367
Short-term investments. . . . . . . . . . . . . . . . . . . . . . . . -- 249,985
Interest, rents and other receivables . . . . . . . . . . . . . . . . 41,300 1,163,973
------------ ------------
Total current assets. . . . . . . . . . . . . . . . . . . . . 2,564,688 3,991,325

Investment in unconsolidated ventures, at equity. . . . . . . . . . . . -- 31,957
Deferred expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . -- 12,196
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105,188 --
------------ ------------

$ 2,669,876 4,035,478
============ ============

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED BALANCE SHEETS - CONTINUED

LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
-----------------------------------------------------

1999 1998
------------ -----------
Current liabilities:
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 89,008 103,437
Amounts due to affiliates . . . . . . . . . . . . . . . . . . . . . . 11,980 731,623
------------ ------------
Total current liabilities . . . . . . . . . . . . . . . . . . 100,988 835,060

Partnership's share of the maximum unfunded
obligation under the indemnification agreement. . . . . . . . . . . . 2,225,817 3,997,006
Distribution received in excess of recorded investment. . . . . . . . . 661,228 --
Long-term debt, less current portion. . . . . . . . . . . . . . . . . . -- 1,667,340
------------ ------------
Commitments and contingencies

Total liabilities . . . . . . . . . . . . . . . . . . . . . . 2,988,033 6,499,406

Partners' capital accounts (deficits):
General partners:
Capital contributions . . . . . . . . . . . . . . . . . . . . . . 1,000 1,000
Cumulative net earnings (losses). . . . . . . . . . . . . . . . . 1,115,114 1,025,076
Cumulative cash distributions . . . . . . . . . . . . . . . . . . (1,149,967) (1,149,967)
------------ ------------
(33,853) (123,891)
------------ ------------
Limited partners:
Capital contributions, net of offering costs. . . . . . . . . . . 326,224,167 326,224,167
Cumulative net earnings (losses). . . . . . . . . . . . . . . . . (265,436,533) (267,492,266)
Cumulative cash distributions . . . . . . . . . . . . . . . . . . (61,071,938) (61,071,938)
------------ ------------
(284,304) (2,340,037)
------------ ------------
Total partners' capital accounts (deficits) . . . . . . . . . (318,157) (2,463,928)
------------ ------------
$ 2,669,876 4,035,478
============ ============

<FN>
See accompanying notes to consolidated financial statements.
</TABLE>

<PAGE>

<TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<CAPTION>

1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
Income:
Rental income . . . . . . . . . . . . . . . . . . . $ -- 4,529,682 16,385,742
Interest income . . . . . . . . . . . . . . . . . . 275,237 458,243 555,587
Dividend income . . . . . . . . . . . . . . . . . . 20,757 -- --
Other income. . . . . . . . . . . . . . . . . . . . 4,158 186,042 --
------------ ------------ ------------
300,152 5,173,967 16,941,329
------------ ------------ ------------
Expenses:
Mortgage and other interest . . . . . . . . . . . . 233,008 4,771,671 9,869,385
Property operating expenses . . . . . . . . . . . . -- 4,337,451 10,768,100
Professional services . . . . . . . . . . . . . . . 164,881 271,017 414,224
Amortization of deferred expenses . . . . . . . . . 12,196 28,688 661,788
General and administrative. . . . . . . . . . . . . 395,299 510,992 540,647
------------ ------------ ------------
805,384 9,919,819 22,254,144
------------ ------------ ------------
(505,232) (4,745,852) (5,312,815)
Partnership's share of the reduction of
the maximum unfunded obligation under
the indemnification agreement . . . . . . . . . . . 2,809,020 134,252 134,252
Partnership's share of income (loss) from
unconsolidated ventures . . . . . . . . . . . . . . (17,762) -- (400,400)
Venture partners' share of earnings (loss) from
consolidated ventures' operations . . . . . . . . . -- (401) (13,305)
------------ ------------ ------------
Earnings (loss) before gains on
sale or disposition of securities,
investment properties or interest in
investment property . . . . . . . . . . . . 2,286,026 (4,612,001) (5,592,268)
Gains (loss) on sale or disposition of securities,
investment properties or interest in investment
property, net of venture partners' share of
$14,492,690 in 1997 . . . . . . . . . . . . . . . . 980,945 5,365,511 96,019,552
------------ ------------ ------------
Earnings (loss) before extraordinary items. . 3,266,971 753,510 90,427,284

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF OPERATIONS - CONTINUED

1999 1998 1997
------------ ------------ ------------
Extraordinary items . . . . . . . . . . . . . . . . . (1,121,200) 47,015,485 55,468,888
------------ ------------ ------------

Net earnings (loss). . . . . . . . . . . . . . $ 2,145,771 47,768,995 145,896,172
============ ============ ============

Net earnings (loss) per limited partnership
interest:
Earnings (loss) before gains on
sale or disposition of securities,
investment properties or interest in
investment property . . . . . . . . . . . . . . $ 6.01 (12.12) (14.67)
Gains (loss) on sale or disposition
of securities, investment properties
or interest in investment property. . . . . . . 2.66 14.54 259.75
Extraordinary items . . . . . . . . . . . . . . . (3.04) 74.92 150.05
------------ ------------ ------------

Net earnings (loss) . . . . . . . . . . . . . . $ 5.63 77.34 395.13
============ ============ ============

<FN>
See accompanying notes to consolidated financial statements.
</TABLE>

<PAGE>

<TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS (DEFICITS)

YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<CAPTION>
GENERAL PARTNERS LIMITED PARTNERS
------------------------------------------------ -----------------------------------------------------
CONTRI-
BUTIONS
NET NET OF NET
CONTRI- EARNINGS CASH OFFERING EARNINGS CASH
BUTIONS (LOSS) DISTRIBUTIONS TOTAL COSTS (LOSS) DISTRIBUTIONS TOTAL
------- ---------- ------------- ----------- ------------ ------------ -------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance
(deficit)
Decem-
ber 31,
1996 . . . . .$1,000(19,776,680) (1,149,967)(20,925,647) 326,224,167 (440,355,677) (40,958,417)(155,089,927)

Net earn-
ings (loss). . -- 1,291,194 -- 1,291,194 -- 144,604,978 -- 144,604,978

Cash distri-
butions
($25 per
limited
partner-
ship
interest). . . -- -- -- -- -- -- (9,149,292) (9,149,292)
------ ----------- ---------- ----------- ----------- ------------ ----------- -----------
Balance
(deficit)
Decem-
ber 31,
1997 . . . . .1,000 (18,485,486) (1,149,967)(19,634,453) 326,224,167 (295,750,699) (50,107,709)(19,634,241)

Net earnings
(loss) . . . . -- 19,510,562 -- 19,510,562 -- 28,258,433 -- 28,258,433
Cash distri-
butions
($30.00 per
limited
partner-
ship
interest). . . -- -- -- -- -- -- (10,964,229)(10,964,229)
------ ----------- ---------- ----------- ----------- ------------ ----------- -----------

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS (DEFICITS) - CONTINUED

GENERAL PARTNERS LIMITED PARTNERS
------------------------------------------------ -----------------------------------------------------
CONTRI-
BUTIONS
NET NET OF NET
CONTRI- EARNINGS CASH OFFERING EARNINGS CASH
BUTIONS (LOSS) DISTRIBUTIONS TOTAL COSTS (LOSS) DISTRIBUTIONS TOTAL
------- ---------- ------------- ----------- ------------ ------------ -------------------------
Balance
(deficit)
Decem-
ber 31,
1998 . . . . .1,000 1,025,076 (1,149,967) (123,891) 326,224,167 (267,492,266) (61,071,938) (2,340,037)

Net earnings
(loss) . . . . -- 90,038 -- 90,038 -- 2,055,733 -- 2,055,733
Cash distri-
butions. . . . -- -- -- -- -- -- -- --
------ ----------- ---------- ----------- ----------- ------------ ----------- -----------
Balance
(deficit)
Decem-
ber 31,
1999 . . . . .$1,000 1,115,114 (1,149,967) (33,853) 326,224,167 (265,436,533) (61,071,938) (284,304)
====== =========== ========== =========== =========== ============ =========== ===========

<FN>
See accompanying notes to consolidated financial statements.
</TABLE>

<PAGE>

<TABLE> CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<CAPTION>
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net earnings (loss) . . . . . . . . . . . . . . . . $ 2,145,771 47,768,995 145,896,172
Items not requiring (providing) cash or
cash equivalents:
Amortization of deferred expenses . . . . . . . . 12,196 28,688 661,788
Amortization of discount on long-term debt. . . . 211,460 187,661 166,538
Long-term debt - deferred accrued interest. . . . -- -- 629,639
Partnership's share of income (loss) from
unconsolidated ventures . . . . . . . . . . . . 17,762 -- 400,400
Partnership's share of the reduction of the
maximum unfunded obligation . . . . . . . . . . (2,809,020) (134,252) (134,252)
Venture partners' share of ventures'
operations. . . . . . . . . . . . . . . . . . . -- 401 13,305
Gain on sale or disposition of securities,
investment properties or interest in
investment properties, net of venture
partner's share . . . . . . . . . . . . . . . . (980,945) (5,365,511) (96,019,552)
Net asset decrease resulting from the
sale of investment properties . . . . . . . . . -- -- 442,505
Extraordinary items . . . . . . . . . . . . . . . 1,121,200 (47,015,485) (55,468,888)
Working capital decrease related to sale of
interest in investment property . . . . . . . . -- -- (2,318,702)
Changes in:
Restricted funds. . . . . . . . . . . . . . . . . -- 23,218 735,933
Interest, rents and other receivables . . . . . . (186,349) 1,046,317 (315,451)
Prepaid expenses. . . . . . . . . . . . . . . . . -- 96,133 11,823
Escrow deposits . . . . . . . . . . . . . . . . . -- 107,674 1,729,227
Accrued rents receivable. . . . . . . . . . . . . -- -- (30,334)
Accounts payable. . . . . . . . . . . . . . . . . (14,430) 131,289 (1,496,748)
Unearned rents. . . . . . . . . . . . . . . . . . -- (109,854) (266,390)
Accrued interest. . . . . . . . . . . . . . . . . -- 4,357,785 5,421,141
Accrued real estate taxes . . . . . . . . . . . . -- -- (1,474,691)
Amounts due to affiliates . . . . . . . . . . . . (48,036) (1,262,516) (1,573,492)
Tenant security deposits. . . . . . . . . . . . . -- (255,538) (386,996)
------------ ------------ ------------
Net cash provided by (used in)
operating activities. . . . . . . . . . . (530,391) (394,995) (3,377,025)
------------ ------------ ------------

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

1999 1998 1997
------------ ------------ ------------
Cash flows from investing activities:
Cash proceeds from sale of investment
properties or interest in investment
property, net of selling expenses . . . . . . . . -- 4,642,150 19,329,753
Additions to investment properties. . . . . . . . . -- (97,746) (2,494,608)
Partnership's advance to affiliated entity. . . . . (105,188) -- --
Net sales and maturities (purchases)
of short-term investments . . . . . . . . . . . . 2,540,348 124,100 --
Partnership's distributions from
unconsolidated ventures . . . . . . . . . . . . . 1,041,252 -- --
Payment of deferred expenses. . . . . . . . . . . . -- -- (357,657)
------------ ------------ ------------
Net cash provided by (used in)
investing activities. . . . . . . . . . . 3,476,412 4,668,504 16,477,488
------------ ------------ ------------
Cash flows from financing activities:
Principal payments on long-term debt. . . . . . . . (3,000,000) (37,494) (453,087)
Venture partner's distribution from venture . . . . -- (222,720) --
Distributions to limited partners . . . . . . . . . -- (10,964,229) (9,149,292)
------------ ------------ ------------
Net cash provided by (used in)
financing activities. . . . . . . . . . . (3,000,000) (11,224,443) (9,602,379)
------------ ------------ ------------
Net increase (decrease) in cash
and cash equivalents. . . . . . . . . . . (53,979) (6,950,934) 3,498,084

Cash and cash equivalents,
beginning of year . . . . . . . . . . . . 2,577,367 9,528,301 6,030,217
------------ ------------ ------------
Cash and cash equivalents,
end of year . . . . . . . . . . . . . . . $ 2,523,388 2,577,367 9,528,301
============ ============ ============

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

1999 1998 1997
------------ ------------ ------------
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest . . . . . $ -- 413,886 3,652,067
============ ============ ============
Non-cash investing and financing activities:
Reduction in investment in unconsolidated venture $ -- -- 400,000
============ ============ ============
Net distributions in excess of recorded
investment. . . . . . . . . . . . . . . . . . . $ (661,228) -- --
============ ============ ============

Activity due to sale of investment properties:
Reduction of fixed assets, net of accumulated
depreciation . . . . . . . . . . . . . . . . . . $ -- 9,379,156 225,785,579
Reduction of working capital. . . . . . . . . . . -- -- 9,495,504
Reduction of security deposits. . . . . . . . . . -- -- (158,400)
Reduction of deferred expenses. . . . . . . . . . -- -- 4,609,869
Reduction of long-term debt (including
accrued interest) . . . . . . . . . . . . . . . -- (56,394,631) (386,383,929)
Venture partners' share of gain . . . . . . . . . -- -- 14,492,690
Gain on sale or disposition of interest in
investment properties, net of venture
partners' share. . . . . . . . . . . . . . . . . -- -- 96,019,552
Extraordinary items . . . . . . . . . . . . . . . -- 47,015,485 55,468,888
------------ ------------ ------------
Cash sales proceeds from sale or disposition
of investment properties, net of selling
expenses. . . . . . . . . . . . . . . . . . . . $ -- 10 19,329,753
============ ============ ============

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

1999 1998 1997
------------ ------------ ------------

Sale of interest in investment property:
Gain on sale of interest in investment
property. . . . . . . . . . . . . . . . . . . $ -- 5,365,511 --
Basis in investment property. . . . . . . . . . -- (723,371) --
------------ ------------ -----------
Cash proceeds from sale of interest
in investment property. . . . . . . . . . $ -- 4,642,140 --
============ ============ ===========

Gain on sale of securities. . . . . . . . . . . $ 980,945 -- --
Basis in securities . . . . . . . . . . . . . . 1,559,403 -- --
------------ ------------ -----------
Cash proceeds from sale of securities . . . $ 2,540,348 -- --
============ ============ ===========

Retirement of long-term debt:
Principal balance due on long-term debt . . . . $ 1,878,800 -- --
Payment on long-term debt . . . . . . . . . . . (3,000,000) -- --
------------ ------------ -----------
Extraordinary item. . . . . . . . . . . . . $ (1,121,200) -- --
============ ============ ===========

Net assets and venture partner's
deficit in venture written off at sale
of interest in investment property. . . . . . . $ -- 355,705 --
============ ============ ===========

<FN>
See accompanying notes to consolidated financial statements.
</TABLE>

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 1999, 1998 AND 1997

OPERATIONS AND BASIS OF ACCOUNTING

GENERAL

The Partnership holds an approximate indirect 25% interest in JMB/NYC
Office Building Associates, L.P. ("JMB/NYC"), which in turn owns an
indirect approximate 4.9% interest in commercial real estate in New York,
New York consisting of the 1290 Avenue of the Americas property. Due to
the Restructuring in November 1999, JMB/NYC owns an indirect interest in
the Partnership that owns 237 Park Avenue and certain other investments
(JMB/NYC's investment is significantly less than 1% of such partnership).

The accompanying consolidated financial statements include the
accounts of the Partnership and its consolidated ventures - Copley Place
Associates ("Copley Place") (sold January 23, 1997); Carrollwood Station
Associates, Ltd. ("Carrollwood") (sold March 2, 1998); and Sherry Lane
Associates ("Sherry Lane") (sold September 12, 1997) in which the
Partnership had certain preferential claims and rights as discussed below.
The effect of all transactions between the Partnership and the consolidated
ventures has been eliminated.

The equity method of accounting had been applied with respect to the
Partnership's indirect 25% interest in JMB/NYC through Carlyle-XIII
Associates, L.P. through the confirmation and acceptance of the Amended
Plan of Reorganization and Disclosure Statement on October 10, 1996
("Effective Date"). During 1996, the Partnership reversed those previously
recognized losses resulting from its interest in JMB/NYC that it is no
longer obligated to fund due to the conversion of JMB/NYC's general
partnership interest to a limited partnership interest in the joint
ventures which owned 1290 Avenue of the Americas and 237 Park Avenue
(collectively, the "Properties") and the terms of the restructuring. The
Partnership has no future funding obligations (other than that related to a
certain indemnification agreement provided in connection with the
restructuring) and has no influence or control over the day-to-day affairs
of the joint ventures or partnership which own the Properties subsequent to
the Effective Date. Accordingly, the Partnership discontinued the
application of the equity method of accounting for the indirect interests
in the Properties and additional losses from the investment in
unconsolidated venture will not be recognized. Should the unconsolidated
venture subsequently report income, the Partnership will resume applying
the equity method on its share of such income only after such income
exceeds net losses not previously recognized.

The Partnership records are maintained on the accrual basis of
accounting as adjusted for Federal income tax reporting purposes. The
accompanying consolidated financial statements have been prepared from such
records after making appropriate adjustments to present the Partnership's
accounts in accordance with generally accepted accounting principles
("GAAP") and to consolidate the accounts of the ventures as described
above. Such GAAP and consolidation adjustments are not recorded on the
records of the Partnership. The effect of these items for the years ended
December 31, 1999 and 1998 is summarized as follows:

<PAGE>

1999 1998
------------------------------ ------------------------------
TAX BASIS TAX BASIS
GAAP BASIS (UNAUDITED) GAAP BASIS (UNAUDITED)
------------ ---------- ----------- ----------
<S> <C> <C> <C> <C>
Total assets. . . . . . . . . . . . $ 2,669,876 42,659,819 4,035,478 44,429,507

Partners' capital accounts
(deficits):
General partners . . . . . . . (33,853) (4,031,365) (123,891) (4,249,821)
Limited partners . . . . . . . (284,304) (48,320,392) (2,340,037) (52,962,082)

Net earnings (loss):
General partners . . . . . . . 90,038 218,456 19,510,562 1,997,992
Limited partners . . . . . . . 2,055,733 4,641,690 28,258,433 36,094,151

Net earnings (loss) per
limited partnership
interest. . . . . . . . . . . . . 5.63 12.71 77.34 98.79
============ ============ ============ ============

</TABLE>

<PAGE>

The net earnings (loss) per limited partnership interest is based upon
the limited partnership interests outstanding at the end of the period.
Deficit capital accounts will result, through the duration of the
Partnership, in net gain for financial reporting and Federal income tax
purposes.

The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

Statement of Financial Accounting Standards No. 95 requires the
Partnership to present a statement which classifies receipts and payments
according to whether they stem from operating, investing or financing
activities. The required information has been segregated and accumulated
according to the classifications specified in the pronouncement.
Partnership distributions from unconsolidated ventures are considered cash
flow from operating activities only to the extent of the Partnership's
cumulative share of net earnings. In addition, the Partnership records
amounts held in U.S. Government obligations at cost, which approximates
market. For the purposes of these statements, the Partnership's policy was
to consider all such amounts held with original maturities of three months
or less ($2,350,000 and $2,461,590 at December 31, 1999 and 1998,
respectively) as cash equivalents, which includes investments in an
institutional mutual fund that holds U.S. Government obligations, with any
remaining amounts (generally with original maturities of one year or less)
reflected as short-term investments being held to maturity.

Deferred expenses were comprised principally of leasing fees which
were amortized using the straight-line method over the terms stipulated in
the related agreements, and commitment fees which were amortized over the
related commitment periods.

Although certain leases of the Partnership provided for tenant
occupancy during periods for which no rent is due and/or increases in
minimum lease payments over the term of the lease, the Partnership accrued
prorated rental income for the full period of occupancy on a straight-line
basis.

No provision for state or Federal income taxes has been made as the
liability for such taxes is that of the partners rather than the
Partnership. However, in certain instances, the Partnership has been or
may be required under applicable law to remit directly to the tax
authorities amounts representing withholding from distributions paid to
partners.

The Partnership acquired, either directly or through joint ventures,
interests in nine apartment complexes, three shopping centers, ten office
buildings and a multi-use complex. Twenty-one properties have been sold or
disposed of by the Partnership as of December 31, 1999.

Statement of Financial Accounting Standards No. 121 ("SFAS 121")
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" was adopted by the Partnership in 1996. SFAS 121
required that the Partnership record an impairment loss on its properties
to be held for investment whenever their carrying value cannot be fully
recovered through estimated undiscounted future cash flows from their
operations and sale. The amount of the impairment loss to be recognized
was the difference between the property's carrying value and the property's
estimated fair value. The Partnership's policy was to consider a property
to be held for sale or disposition when the Partnership had committed to a
plan to sell or dispose of such property and active marketing activity had

<PAGE>

commenced or was expected to commence in the near term or the Partnership
had concluded that it might have disposed of the property by no longer
funding operating deficits or debt service requirements of the property
thus allowing the lender to realize upon its security. In accordance with
SFAS 121, any properties identified as "held for sale or disposition" were
no longer depreciated. Adjustments for impairment loss for such properties
(subsequent to the date of adoption of SFAS 121) were made in each period
as necessary to report these properties at the lower of carrying value or
fair value less costs to sell. In certain situations, such estimated fair
value was less than the existing non-recourse debt which was secured by the
property.

The results of operations, net of venture partners' share, for
consolidated properties sold or disposed of during the past three years
were $0, $(4,688,400) and $(3,727,014), respectively, for the years ended
December 31, 1999, 1998 and 1997.

VENTURE AGREEMENTS - GENERAL

The Partnership at December 31, 1999 is a party to one operating joint
venture agreement (JMB/NYC). Pursuant to such agreement, the Partnership
made initial capital contributions of approximately $43,254,393 (before
legal and other acquisition costs and its share of operating deficits as
discussed below).

INVESTMENT PROPERTIES

LONG BEACH PLAZA

The Partnership had not remitted all of the scheduled debt service
payments for the mortgage loan secured by the Long Beach Plaza Shopping
Center since June 1993. The mortgage lender agreed to a short-term loan
extension until August 31, 1995. The Partnership was unable to secure a
modification or further extension to the loan and decided not to commit any
significant additional amounts to the property. In March 1996, a receiver
for the property was appointed for the benefit of the lender. On December
31, 1998, the Partnership transferred title to the land, building and
improvements, and other assets and liabilities related to the property in
consideration of a discharge of the mortgage loan and payment of $10 in
cash. The Partnership realized an extraordinary gain on forgiveness of
debt from this transaction in 1998 of approximately $47,015,000 for
financial reporting purposes. This amount includes the effect of the
impairment losses recognized by the Partnership aggregating approximately
$17,600,000. In addition, the Partnership recognized a gain of
approximately $28,256,000 for Federal income tax purposes, with no
corresponding distributable proceeds.

In December 1999, the Partnership reached an agreement with the seller
of the Long Beach investment property for the retirement of the promissory
note payable in the amount of $10,000,000, originally due in 2013 and 2014
to the seller in connection with the acquisition of the property by the
Partnership in 1983. The terms of the agreement provided for full
satisfaction of the loan in exchange for a payment of $3,000,000. On
December 22, 1999, the Partnership remitted this payment to the seller and
received a full release of all obligations related to the loan. In 1984,
the Partnership purchased certain government securities to help offset the
$10,000,000 obligation due in 2013 and 2014. The Partnership sold these
marketable securities (with a market value of approximately $2,535,000 and
a carrying value of $1,559,000) and used the proceeds to make the payment,
with the remainder of approximately $465,000 funded from available cash
held by the Partnership. As a result of these transactions, the
Partnership recognized income of approximately $3,000,000 for federal
income tax purposes. Additionally, the Partnership recognized a gain from
the sale of securities of approximately $980,000 and an extraordinary loss
from extinguishment of debt of approximately $1,100,000 for financial
reporting purposes in 1999.

<PAGE>

COPLEY PLACE

On January 23, 1997, through a series of transactions, the Partnership
sold its entire partnership interest in Copley Place Associates as
described below.

During 1996, the Partnership and Copley Place Associates had committed
to a plan to sell the property, and therefore, classified the property as
held for sale at October 1, 1996. The property was not subject to
continued depreciation as of such date.

The Partnership's outstanding obligations on the purchase price note
(the "Note") and for principal and interest on certain loans (the "Deficit
Loans") made by the joint venture partner to pay for operating deficits (as
defined), and the projected continuing accruals of additional interest on
such amounts made it unlikely that the Partnership's interest in Copley
Place Associates would ever be sold for an amount which would result in any
net proceeds to the Partnership. In order to provide the Partnership with
incentive to consummate the sale of its interest, the joint venture
partner, the holder of the Note and the Partnership executed an agreement
whereby the net proceeds were distributed in a manner which permitted the
Partnership to satisfy its obligations relative to the Note and the Deficit
Loans and still realize some modest cash proceeds. In addition, the holder
of the Note agreed on a discounted payoff of the Note. In general, the
Partnership received $43,900,000 of sale proceeds, of which $34,000,000 was
remitted to the holder of the Note as payment in full satisfaction of the
Note. As a result, the Partnership was relieved of an approximately
$55,000,000 obligation. The Partnership's obligation under the Deficit
Loans were next satisfied in full out of the Partnership's remaining sale
proceeds. After the repayment of the Note and Deficit Loans, as discussed
above, the Partnership's remaining net proceeds amounted to approximately
$929,000, all of which was received in cash at closing.

The effect on the Partnership's consolidated financial statements as a
result of the sale was to eliminate the Partnership's investment in Copley
Place Associates and to recognize a gain on sale of the Partnership's
interest in the consolidated venture of approximately $71,277,000 and a
gain on the forgiveness of indebtedness of approximately $55,184,000 for
financial reporting purposes in 1997. The Partnership also recognized a
gain on the sale of approximately $171,500,000 for Federal income tax
purposes in 1997.

JMB/NYC

JMB/NYC is a limited partnership among Carlyle-XIII Associates, L.P.,
and its affiliates Carlyle-XIV Associates, L.P. and Property Partners,
L.P., as limited partners and Carlyle Managers, Inc. as the sole general
partner. The Partnership is a 25% shareholder of Carlyle Managers, Inc.
The Partnership currently holds, indirectly as a limited partner of
Carlyle-XIII Associates, L.P., an approximate 25% limited partnership
interest in JMB/NYC. The sole general partner of Carlyle-XIII Associates,
L.P. is Carlyle Investors, Inc., of which the Partnership is a 25%
shareholder. The general partner in each of JMB/NYC and Carlyle-XIII
Associates, L.P. is an affiliate of the Partnership.

<PAGE>

approval rights of JMB/NYC with respect to virtually all property
management, leasing, sale or refinancing; (iv) amend the Joint Ventures'
agreements to eliminate any funding obligations by JMB/NYC and (v)
establish a new preferential cash distribution level for the Olympia & York
affiliates. In accordance with the Agreement and in anticipation of the
sale of the 2 Broadway Building, the unpaid first mortgage indebtedness
previously allocated to 2 Broadway was allocated in 1994 to 237 Park Avenue
and 1290 Avenue of the Americas.

In September 1995, the sale of the 2 Broadway Building was completed. Such
sale did not result in any distributable proceeds to JMB/NYC or the Olympia
& York affiliates.

Bankruptcy filings for the Joint Ventures owning the 237 Park Avenue
and 1290 Avenue of the Americas properties (collectively, the "Properties")
were made in April 1996, and in August 1996, an Amended Plan of
Reorganization and Disclosure Statement (the "Plan") was filed with the
Bankruptcy Court for these Joint Ventures. The Plan was accepted by the
various classes of debt and equity holders and confirmed by the Court on
September 20, 1996 and became effective October 10, 1996 ("Effective
Date"). The Plan provided that JMB/NYC had an indirect limited partnership
interest which, before taking into account significant preferences to other
partners, equaled approximately 4.9% of the reorganized and restructured
ventures owning 237 Park and 1290 Avenue of the Americas. Neither O&Y nor
any of its affiliates retained any direct or indirect continuing interest
in the Properties. The new ownership structure gave control of the two
properties to an unaffiliated real estate investment trust ("REIT"), owned
primarily by holders of the first mortgage debt that encumbered the
Properties prior to the bankruptcy. JMB/NYC had, under certain limited
circumstances, through January 1, 2001 rights of consent regarding sale of
the Properties or the consummation of certain other transactions that would
have significantly reduced indebtedness of the Properties. In general, at
any time on or after January 2, 2001, an affiliate of the REIT had the
right to purchase JMB/NYC's interest in the Properties for an amount based
on a formula relating to the operations of the Properties (the "Formula
Price"). In addition, the non-recourse purchase money note made by JMB/NYC
for its interests in the Properties, which is secured by JMB/NYC's
interests in the Properties and had outstanding principal and accrued and
deferred interest of approximately $133,148,000, at December 31, 1999,
matures on January 2, 2001. If such REIT affiliate exercised such right to
purchase, for the reasons discussed below, it was unlikely that such
purchase would result in any significant distributions to the partners of
the Partnership. Additionally, at any time, JMB/NYC had the right to
require such REIT affiliate to purchase the interest of JMB/NYC in the
Properties for the Formula Price.

Pursuant to the indemnification agreement, the Affiliated Partners
were jointly and severally obligated to indemnify the REIT to the extent of
$25 million to ensure their compliance with the terms and conditions
relating to JMB/NYC's indirect limited partnership interest in the
restructured and reorganized joint ventures that owned the Properties. The
Affiliated Partners contributed approximately $7.8 million (of which the
Partnership's share was approximately $1.9 million) to JMB/NYC, which was
deposited into an escrow account as collateral for such indemnification.
These funds have been invested in stripped U.S. Government obligations with
a maturity date of February 15, 2001. Due to the Restructuring discussed
below, the maximum potential obligation has been reduced to $14,285,000 and
a portion of the collateral was released in 1999 to JMB/NYC. The
Partnership's share of the reduction of the maximum unfunded obligation

<PAGE>

under the indemnification agreement recognized as income is a result of
interest earned on amounts contributed by the Partnership and held in
escrow by JMB/NYC, and, in 1999, the agreed upon reduction of the maximum
obligation. Interest income earned reduces the Partnership's share of the
maximum unfunded obligation under the indemnification agreement, which is
reflected as a liability in the accompanying financial statements.

The provisions of the indemnification agreement (as amended in
connection with the Restructuring discussed below) generally prohibit the
Affiliated Partners from taking actions that could have an adverse effect
on the exercise of the purchase rights by the REIT affiliate discussed
below or a sale or certain other transactions involving direct or indirect
interest in 1290 Avenue of the Americas unless such transaction requires
JMB/NYC's consent. Compliance, therefore, is within the control of the
Affiliated Partners and non-compliance with such provisions by either the
Partnership or the other Affiliated Partners is highly unlikely.
Therefore, the Partnership expects its share of the remaining collateral to
be returned (including interest earned) after the termination of the
indemnification agreement.

Although under the terms of the Restructuring Agreement JMB/NYC is not
able to cause a sale of the interest in the 237 Partnership prior to 2001,
the earliest date on which such interest may be purchased at the election
of the general partner of the 237 Partnership is January 2002. In the
absence of JMB/NYC's earlier election to cause a sale of its interest in
the 237 Partnership, this extends by a year (to January 2002 from January
2001) the date on which JMB/NYC's indirect interest in 237 Park was
previously subject to purchase at the election of an affiliate of the REIT.

<PAGE>

JMB/NYC's indirect interest through the Upper Tier Partnership in the
Partnership (the "1290 Partnership") that owns 1290 Avenue of the Americas
was also modified, although the REIT continues to own the controlling
interest in the property. In general, the REIT has the right to sell 1290
Avenue of the Americas or the REIT's interest in the 1290 Partnership or
permit a sale of more than 51% of the stock in the REIT, during the period
January 1, 2000 through February 28, 2001, provided that JMB/NYC receives
the greater of (i) an amount based on a formula relating to the operations
of the property (the "1290 Formula Price"), and (ii) $4,500,000. Although
the REIT is able to cause a sale of the entire property one year earlier
than previously, which would result in the Partnership's (and the Holders
of Interests') recognition of income for Federal income tax purposes from
such a transaction, JMB/NYC would be entitled to receive a minimum
specified amount (determined as described above) in connection with such
sale. An affiliate of the REIT also has the right, during the month of
March of each calendar year commencing with 2001, to purchase JMB/NYC's
indirect interest in the 1290 Partnership for the greater of (x) the 1290
Formula Price and (y) $1,400,000. In addition, JMB/NYC has the right,
during the month of September of each calendar year commencing with 2001,
to require an affiliate of the REIT to purchase JMB/NYC's indirect interest
in the 1290 Partnership for the greater of (1) the 1290 Formula Price, and
(2) $1,000,000.

A portion of the purchase price for JMB/NYC's indirect interest in the
1290 Avenue of the Americas and 237 Park Avenue office buildings is
represented by a certain promissory note (the "Purchase Note") bearing
interest at 12-3/4% per annum. The Purchase Note is secured by JMB/NYC's
indirect interest in the 1290 Partnership and the 237 Partnership and is
non-recourse to JMB/NYC. Prior to maturity, the Purchase Note requires
payment of principal and interest out of distributions made to JMB/NYC from
the 1290 Partnership and the 237 Partnership. Unpaid interest accrues and
is deferred, compounded monthly. Unpaid principal and interest are due at
maturity on January 2, 2001, and it is not expected that JMB/NYC will have
funds to pay the Purchase Note at maturity. The outstanding principal and
accrued and deferred interest on the Purchase Note at December 31, 1999,
was approximately $133,148,000.

In connection with the Restructuring, approximately $4,460,000 in face
amount at maturity of U.S. Treasury securities currently held as collateral
for the indemnification obligations of the Affiliated Partners was released
from escrow and returned to the Affiliated Partners. The remaining face
amount of the securities will be held as collateral for the indemnification

<PAGE>

obligations of the Affiliated Partners relating to 1290 Avenue of the
Americas generally until 90 days after the earlier of the sale of 1290
Avenue of the Americas and the sale of JMB/NYC's indirect interest in 1290
Avenue of the Americas. The Partnership expects its share of the remaining
collateral, including interest earned thereon, to be returned after the
termination of the indemnification obligations.

While the Partnership is not expected to terminate in the near term,
it currently appears unlikely that any significant distributions will be
made by JMB/NYC to the Partnership at any time due to, among other things,
the level of indebtedness remaining on the 1290 Avenue of the Americas, the
Purchase Note payable by JMB/NYC, and the significant preference levels to
other partners within the 1290 Partnership.

ORCHARD ASSOCIATES

The Partnership's interest in Old Orchard Shopping Center (through
Orchard Associates and Old Orchard Urban Venture ("OOUV")) was sold in
September 1993.

In 1998, the Partnership received income of approximately $186,000
related to a sale of stock received in the settlement of claims against a
former tenant in bankruptcy (prior to the sale of the Partnership's
interest in 1993). The Partnership retained these funds for working
capital purposes.

SHERRY LANE PLACE OFFICE BUILDING

The Partnership had committed to a plan to sell or dispose of Sherry
Lane Place office building, and accordingly, as of December 31, 1996, the
Partnership classified this property as held for sale or disposition. The
property was not subject to continued depreciation after such date.

On September 12, 1997, the Partnership, through Sherry Lane
Associates, sold the Sherry Lane Place Office Building to an unaffiliated
third party for $44,000,000 (before selling costs and prorations) all of
which was paid in cash at closing. After repayment of the mortgage notes
securing the property (approximately $41,171,000, including contingent
interest (as defined)), the Partnership realized net proceeds of
approximately $2,653,000. The sale resulted in a gain of approximately
$18,300,000 to the Partnership in 1997 for financial reporting purposes.
The Partnership recognized a gain of approximately $29,600,000 for Federal
income tax purposes in 1997. Pursuant to the Sherry Lane Associates
venture agreement, substantially all of the net proceeds from the sale were
distributed to the Partnership. In connection with the sale of this
property and as is customary in such transactions, Sherry Lane Associates
agreed to certain representations and warranties, with a stipulated
survival period which expired December 15, 1997 with no liability to the
Partnership.

CARROLLWOOD STATION APARTMENTS

The joint venture committed to a plan to sell or dispose of
Carrollwood Station Apartments. Accordingly, as of December 31, 1996, the
joint venture classified this property as held for sale or disposition.
The property was not subject to continued depreciation after such date.

In December 1997, the Partnership, on behalf of the joint venture,
entered into a contract with an unaffiliated third party to sell the
property. Pursuant to the joint venture agreement, the unaffiliated
venture partner held the right of first refusal to purchase the
Partnership's interest in the joint venture in the event the Partnership
secured a buyer for the property. On March 2, 1998, the unaffiliated
venture partner purchased the Partnership's interest in the joint venture
for $4,642,140, which approximated the share of proceeds that the
Partnership would have received from a sale of the property to the proposed

<PAGE>

purchaser of the property. As of the date of the sale, the Partnership was
relieved from any further obligations under the joint venture agreement.
The Partnership recognized a gain of approximately $5,366,000 for financial
reporting purposes and a gain of approximately $8,501,000 for Federal
income tax purposes in 1998.

MICHAEL'S (MARSHALL'S) AURORA PLAZA

As of December 31, 1996, the Partnership committed to a plan to sell
or dispose of Michael's Aurora Plaza. Accordingly, the Partnership
classified this property as held for sale or disposition. The property was
not subject to continued depreciation after such date.

In August 1997, the Partnership entered into a contract to sell the
property to an unaffiliated third party buyer. Pursuant to the contract,
on October 15, 1997, the Partnership sold the land and related improvements
of the Michael's Aurora Plaza. The sale price was $6,885,000, all of which
was paid in cash at closing (net of selling costs). The Partnership used a
substantial portion of the proceeds to repay the existing mortgage note of
approximately $5,045,000, and the Partnership realized net proceeds of
approximately $1,600,000. The sale resulted in a gain in 1997 to the
Partnership of approximately $819,000 for financial reporting purposes and
approximately $4,176,000 for Federal income tax purposes. In addition, in
connection with the sale of this property and as is customary in such
transactions, the Partnership agreed to certain representations and
warranties, with a stipulated survival period which expired June 15, 1998,
with no liability to the Partnership.

FIRST TENNESSEE PLAZA (PLAZA TOWER)

As of December 31, 1996, the Partnership committed to a plan to sell
or dispose of First Tennessee Plaza office building. Accordingly, the
Partnership classified this property as held for sale or disposition. The
property was not subject to continued depreciation after such date.

On September 19, 1997, the Partnership sold the land, related
improvements, and personal property of the First Tennessee Plaza office
building to an unaffiliated third party for $29,200,000 (before selling
costs and prorations) all of which was paid in cash at closing. After
repayment of the mortgage note securing the property (approximately
$15,079,000), the Partnership realized net proceeds of approximately
$13,462,000. The sale resulted in a gain of approximately $5,347,000 to
the Partnership in 1997 for financial reporting purposes. The Partnership
recognized a gain of approximately $20,131,000 for Federal income tax
purposes in 1997. In connection with the sale of this property and as is
customary in such transactions, the Partnership agreed to certain
representations and warranties, with a stipulated survival period which
expired December 15, 1997 with no liability to the Partnership.

ALLIED AUTOMOTIVE CENTER

On October 10, 1990, the Partnership sold the land, building, and
related improvements of the Allied Automotive Center located in Southfield,
Michigan.

The Partnership had retained title to a defined 1.9 acre piece of land
(the "Parcel"). During the buyer's due diligence investigation, the buyer
found traces of contamination located on a portion of the Parcel as well as
on a portion of the land owned by two affiliated selling entities. It was
subsequently determined that such contamination was most likely the result
of certain activities of the previous owner. As a result, the purchase
price was reduced by approximately $682,000 for the Partnership's excluded
land. The land was to be purchased by the buyer after the environmental
clean-up was completed. During 1996, the Partnership was informed that
certain regulatory agencies approved the clean-up of the site that had been
performed and approved the shut-down of the clean-up operation. On
March 12, 1997, the Partnership sold the Parcel for approximately $682,000.

The sale of this Parcel resulted in a gain for financial reporting and
Federal income tax purposes of approximately $542,000 in 1997.

<PAGE>

LONG-TERM DEBT

Long-term debt consists of the following at December 31, 1999 and 1998:

1999 1998
----------- -----------
Other loans:
Long Beach Plaza Shopping Center,
non-interest bearing promissory
note to original seller, (net of
$8,332,660 unamortized discount
at 12% at December 31, 1998)
due 2014, retired in 1999 . . . . . . $ -- 1,667,340
----------- -----------
Total debt. . . . . . . . . . . . -- 1,667,340
Less current portion
of long-term debt . . . . . . . -- --
----------- -----------
Total long-term debt. . . . . $ -- 1,667,340
=========== ===========

PARTNERSHIP AGREEMENT

Pursuant to the terms of the Partnership Agreement, net profits and
losses of the Partnership from operations are allocated 96% to the Holders
of Interests and 4% to the General Partners. Profits from the sale of
investment properties are allocated to the General Partners to the greatest
of (i) 1% of such profits, (ii) the amount of cash distributions to the
General Partners, or (iii) an amount which will reduce the General
Partners' capital account deficits (if any) to a level consistent with the
gain anticipated to be realized from the sale of properties. In accordance
with clause (iii) of such provision, the General Partners were allocated an
additional $19,171,233 of gain for financial reporting purposes for the
years ended December 31, 1998. Additionally, the General Partners were
allocated $53,177 and $1,577,028 of additional gain for Federal income tax
purposes for the years ended December 31, 1999 and 1998, respectively.
Losses from the sale of properties are allocated 1% to the General
Partners. The remaining profits and losses are allocated to the Holders of
Interests.

The General Partners are not required to make any additional capital
contributions except under certain limited circumstances upon termination
of the Partnership. Distributions of "Net cash receipts" of the
Partnership are allocated 90% to the Holders of Interests and 10% to the
General Partners (of which 6.25% constitutes a management fee to the
Corporate General Partner for services in managing the Partnership).

The Partnership Agreement provides that the General Partners shall
receive as a distribution of the proceeds (net after expenses and
liabilities and retained working capital) from the sale or refinancing of a
real property of up to 3% of the selling price of a property, and that the
remaining net proceeds for any property sold be distributed 85% to the
Holders of Interests and 15% to the General Partners. However, prior to
such distributions being made, the Holders of Interests are entitled to
receive 99% of net sale or refinancing proceeds and the General Partners
are entitled to receive 1% until the Holders of Interests (i) have received
cumulative cash distributions from the Partnership's operations which, when
combined with net sale or refinancing proceeds previously distributed,
equal a 6% annual return on the Holders' average capital investment for
each year (their initial capital investment as reduced by net sale or
refinancing proceeds previously distributed) and (ii) have received cash
distributions of net sale or refinancing proceeds in an amount equal to the

<PAGE>

Holders' aggregate initial capital investment in the Partnership. If upon
the completion of the liquidation of the Partnership and the distribution
of all Partnership funds, the Holders of Interests have not received the
amounts in (i) and (ii) above, the General Partners will be required to
return all or a portion of the 1% distribution of net sale or refinancing
proceeds described above in an amount equal to such deficiency in payments
to the Holders of Interests pursuant to (i) and (ii) above. The Holders of
Interests have not received and are not expected to receive distributions
to the above levels. As of the date of this report, the General Partners
have received $123,891 in distributions of net sale proceeds.

MANAGEMENT AGREEMENTS

The Partnership had entered into agreements for the operation and
management of the investment properties. Such agreements are summarized as
follows:

The Partnership entered into an agreement with an affiliate of the
seller for the operation and management of Michael's Aurora Plaza (prior to
its sale in October 1997) for a management fee calculated at a percentage
of certain types of cash income from the property.

The Long Beach Plaza in Long Beach, California (prior to its
disposition in December 1998), First Tennessee Plaza (Plaza Tower) office
building in Knoxville, Tennessee (prior to its sale in September 1997) and
Sherry Lane Place office building in Dallas, Texas (prior to its sale in
September 1997) were managed by an affiliate of the Corporate General
Partner until December 1994 for a fee equal to a percentage of defined
gross income from the property. In December 1994, one of the affiliated
property managers sold substantially all of its assets and assigned its
interest in its management contracts to an unaffiliated third party. In
addition, certain of the management personnel of the property manager
became management personnel of the purchaser and its affiliates. The
successor to the affiliated property manager's assets was acting as the
property manager of the Plaza Tower office building and the Sherry Lane
office building through the respective dates of their sale on the same
terms that existed prior to the assignment of the management contracts.

LEASE - AS PROPERTY LESSEE

The following lease agreement had been determined to be an operating
lease:

Prior to the disposition of the Long Beach property, the Partnership
owned the leasehold rights to the parking structure adjacent to the
shopping center. The lease had an initial term of 50 years which commenced
in 1981 with one 49-year renewal option exercisable by a local municipal
authority. The lease provided for annual rental of $745,000, which was
subject to decrease based on formulas which related to the amount of real
estate taxes assessed against the shopping center and the parking
structure. The rental expense for 1998 and 1997 under the above operating
lease was $547,371 and $533,181, respectively, and consisted exclusively of
minimum rent. Such lease was assigned to an unaffiliated third party in
connection with the disposition of the property.

TRANSACTIONS WITH AFFILIATES

The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Corporate General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investment properties. Fees, commissions
and other expenses required to be paid by the Partnership to the General
Partners and their affiliates for the years ended December 31, 1999, 1998
and 1997 are as follows:

<PAGE>

UNPAID AT
DECEMBER 31,
1999 1998 1997 1999
------- ------- ------- ------------
Property management
and leasing fees . . . . . $ -- 121,522 89,060 --
Insurance commissions . . . 1,248 28,795 70,890 --
Reimbursement (at cost)
for accounting services. . 232 16,155 36,297 46
Reimbursement (at cost)
for portfolio manage-
melt services. . . . . . . 33,650 88,318 43,856 7,157
Reimbursement (at cost)
for legal services . . . . 16,817 10,866 18,423 4,777
Reimbursement (at cost)
for administrative
charges and other out-
of-pocket expenses . . . . -- 115 164 --
------- ------- ------- ------
$51,947 265,771 258,690 11,980
======= ======= ======= ======

In February 1998, the Partnership paid approximately $1,322,000 of
previously deferred management and leasing fees to an affiliate of the
General Partners. All subsequent property management fees and leasing fees
were paid currently.

The Partnership had obligations, which bore interest ranging from
4.62% to 5.35% per annum in 1999, to fund, on demand, $200,000 and $200,000
to Carlyle Investors, Inc. and Carlyle Managers, Inc., respectively, of
additional paid-in capital. In 1999, these obligations including all
unpaid accrued interest aggregating approximately $670,000 were retired.
Such amounts are recorded as distributions received in excess of recorded
investment in the accompanying 1999 balance sheet.

<PAGE>

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

There were no changes in or disagreements with accountants during
fiscal year 1999 and 1998.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP

The Corporate General Partner of the Partnership is JMB Realty
Corporation ("JMB"), a Delaware corporation. Substantially all of the
outstanding shares of JMB are owned, directly or indirectly, by certain of
its officers, directors, members of their families and their affiliates.
JMB, as the Corporate General Partner, has responsibility for all aspects
of the Partnership's operations, subject to the requirement that purchases
and sales of real property must be approved by the Associate General
Partner of the Partnership, ABPP Associates, L.P., an Illinois limited
partnership with JMB as its sole general partner. The limited partners of
ABPP Associates, L.P. are generally current or former officers and
directors of JMB and their affiliates.

The Partnership is subject to certain conflicts of interest arising
out of its relationships with the General Partners and their affiliates as
well as the fact that the General Partners and their affiliates are engaged
in a range of real estate activities. Certain services have been and may
in the future be provided to the Partnership or its investment properties
by affiliates of the General Partners, including property management,
insurance brokerage and administrative services. In general, such services
are to be provided on terms no less favorable to the Partnership than could
be obtained from independent third parties and are otherwise subject to
conditions and restrictions contained in the Partnership Agreement. The
Partnership Agreement permits the General Partners and their affiliates to
provide services to, and otherwise deal and do business with, persons who
may be engaged in transactions with the Partnership, and permits the
Partnership to borrow from, purchase goods and services from, and otherwise
to do business with, persons doing business with the General Partners or
their affiliates. The General Partners and their affiliates may be in
competition with the Partnership or its investment properties under certain
circumstances, including, in certain geographical markets, for tenants for
properties and/or for the sale of properties. Because the timing and
amount of cash distributions and profits and losses of the Partnership may
be affected by various determinations by the General Partners under the
Partnership Agreement, including whether and when to sell or refinance a
property, the establishment and maintenance of reasonable reserves and the
determination of the sources (i.e., offering proceeds, cash generated from
operations or sale proceeds) and uses or distributions of such reserves,
the timing of expenditures and the allocation of certain tax items under
the Partnership Agreement, the General Partners may have a conflict of
interest with respect to such determinations.

The names, positions held and length of service therein of each
director and the executive officers of the Corporate General Partner of the
Partnership are as follows:

<PAGE>

SERVED IN
NAME OFFICE OFFICE SINCE
- ---- ------ ------------
Judd D. Malkin Chairman 5/03/71
Director 5/03/71
Chief Financial Officer 2/22/96
Neil G. Bluhm President 5/03/71
Director 5/03/71
Burton E. Glazov Director 7/01/71
Stuart C. Nathan Executive Vice President 5/08/79
Director 3/14/73
A. Lee Sacks Director 5/09/88
John G. Schreiber Director 3/14/73
H. Rigel Barber Chief Executive Officer 8/01/93
Executive Vice President 1/02/87
Gary Nickele Executive Vice President 1/01/92
General Counsel 2/27/84
Gailen J. Hull Senior Vice President 6/01/88

Effective May 31, 1996, the Board of Directors of JMB established a special
committee, consisting of Messrs. Malkin, Glazov, Nathan, Sacks and
Schreiber, to deal with all matters relating to tender offers for
Interests.

There is no family relationship among any of the foregoing directors
or officers. The foregoing directors have been elected to serve a one-year
term until the annual meeting of the Corporate General Partner to be held
on June 6, 2000. All of the foregoing officers have been elected to serve
one-year terms until the first meeting of the Board of Directors held after
the annual meeting of the Corporate General Partner to be held on June 6,
2000. There are no arrangements or understandings between or among any of
said directors or officers and any other person pursuant to which any
director or officer was elected as such.

JMB is the corporate general partner of Carlyle Real Estate Limited
Partnership-XI ("Carlyle-XI"), Carlyle Real Estate Limited Partnership-XIV
("Carlyle-XIV"), Carlyle Real Estate Limited Partnership-XV ("Carlyle-XV"),
and Carlyle Income Plus, L.P.-II ("Carlyle Income Plus-II") and the
managing general partner of JMB Income Properties, Ltd.-V ("JMB Income-V"),
JMB Income Properties, Ltd.-VII ("JMB Income-VII"), and JMB Income
Properties, Ltd.-XI ("JMB Income-XI"). JMB is also the sole general
partner of the associate general partner of most of the foregoing
partnerships.

The foregoing directors and officers are also officers and/or
directors of various affiliated companies of JMB including Arvida/JMB
Managers, Inc. (the general partner of Arvida/JMB Partners, L.P). Most of
such directors and officers are also partners, directly or indirectly, of
certain partnerships which are associate general partners in the following
real estate limited partnerships: the Partnership, Carlyle-XI,
Carlyle-XIV, Carlyle-XV, JMB Income-VII, JMB Income-XI, and Carlyle Income
Plus-II.

The business experience during the past five years of each such
director and officer of the Corporate General Partner of the Partnership in
addition to that described above is as follows:

Judd D. Malkin (age 62) is Chairman and Chief Financial Officer of
Carlyle Managers, Inc., the general partner of JMB/NYC. He is also an
individual general partner of JMB Income-V. Mr. Malkin has been associated
with JMB since October, 1969. Mr. Malkin is also a director of Urban
Shopping Centers, Inc., an affiliate of JMB that is a real estate
investment trust in the business of owning, managing and developing
shopping centers. He is also a director of Chisox Corporation, which is
the general partner of a limited partnership that owns the Chicago White
Sox, a Major League Baseball team, and CBLS, Inc., which is the general
partner of the general partner of a limited partnership that owns the
Chicago Bulls, a National Basketball Association team. He is a Certified
Public Accountant.

<PAGE>

Neil G. Bluhm (age 62) is Executive Vice President of Carlyle
Managers, Inc. He is also an individual general partner of JMB Income-V.
Mr. Bluhm has been associated with JMB since August, 1970. Mr. Bluhm is
also a principal of Walton Street Capital, L.L.C., which sponsors real
estate investment funds, and a director of Urban Shopping Centers, Inc. He
is a member of the Bar of the State of Illinois and a Certified Public
Accountant.

Burton E. Glazov (age 61) has been associated with JMB since June,
1971 and served as an Executive Vice President of JMB until December 1990.
Mr. Glazov is currently retired. He is a member of the Bar of the State of
Illinois.

Stuart C. Nathan (age 58) is the director and President of Carlyle
Managers, Inc. Mr. Nathan has been associated with JMB since July, 1972.
He is a member of the Bar of the State of Illinois.

A. Lee Sacks (age 66) has been associated with JMB since December,
1972. He is also President and a director of JMB Insurance Agency, Inc.

John G. Schreiber (age 53) has been associated with JMB since
December, 1970 and served as an Executive Vice President of JMB until
December 1990. Mr. Schreiber is President of Schreiber Investments, Inc. a
company engaged in the real estate investing business. He is also a senior
advisor and partner of Blackstone Real Estate Advisors L.P., an affiliate
of the Blackstone Group, L.P. Mr. Schreiber is also a director of Urban
Shopping Centers, Inc., Host Marriott Corporation, The Brickman Group,
Ltd., which is engaged in the landscape maintenance business, and a
director of a number of investment companies advised by T. Rowe Price
Associates, Inc. and its affiliates, and a trustee of Amli Residential
Properties Trust. Mr. Schreiber holds a Masters degree in Business
Administration from Harvard University Graduate School of Business.

H. Rigel Barber (age 51) is Vice President of Carlyle Managers, Inc.
Mr. Barber has been associated with JMB since March, 1982. He holds a J.D.
degree from the Northwestern Law School and is a member of the Bar of the
State of Illinois.

Gary Nickele (age 47) is Vice President and General Counsel of Carlyle
Managers, Inc. Mr. Nickele has been associated with JMB since February,
1984. He holds a J.D. degree from the University of Michigan Law School
and is a member of the Bar of the State of Illinois.

Gailen J. Hull (age 51) has been associated with JMB since March,
1982. He holds a Masters degree in Business Administration from Northern
Illinois University and is a Certified Public Accountant.

<PAGE>

ITEM 11. EXECUTIVE COMPENSATION

The Partnership has no officers or directors. The Partnership is
required to pay a management fee to the Corporate General Partner and the
General Partners are entitled to receive a share of cash distributions,
when and as cash distributions are made to the Holders of Interests, and a
share of profits or losses. Reference is made to the Notes for a
description of such distributions and allocations. In 1999, the General
Partners received no distributions and the Corporate General Partner
received no management fee. The General Partners received an additional
share of Partnership gains for Federal income tax purposes aggregating
$53,253 in 1999. Such allocation of income reduces the deficit balances in
the capital accounts of the General Partners and an obligation under the
terms of the Partnership Agreement to make capital contributions in the
amount of the deficit balances in their capital accounts upon termination
of the Partnership.

If upon the completion of the liquidation of the Partnership and the
distribution of all Partnership funds, the Holders of Interest have not
received a certain specified amount of net sale or refinancing proceeds,
the General Partners will be required to return the net sale or refinancing
proceeds received by them, $123,891 as of the date of this report. The
Holders of Interests are not expected to receive the specified amount of
net sale or refinancing proceeds. Accordingly, the General Partners will
be required to return the $123,891 of sale or refinancing proceeds prior to
termination of the Partnership.

The Partnership is permitted to engage in various transactions
involving affiliates of the Corporate General Partner of the Partnership,
as described in the Notes, which may involve conflicts of interest for the
General Partners or their affiliates. The relationship of the Corporate
General Partner (and its directors and officers) to its affiliates is set
forth above in Item 10.

JMB Insurance Agency, Inc., an affiliate of the Corporate General
Partner, earned insurance brokerage commissions in 1999 aggregating $1,248
for providing professional liability insurance for the Partnership, all of
which was paid at December 31, 1999. Such commissions are at rates set by
insurance companies for the classes of coverage provided.

The General Partners of the Partnership or their affiliates may be
reimbursed for their direct expenses or out-of-pocket expenses and salaries
and related salary expenses relating to the administration of the
Partnership and the acquisition and operation of the Partnership's real
property investments. In 1999, the Corporate General Partner of the
Partnership or its affiliates were due no reimbursement for such
out-of-pocket expenses. The General Partners are also entitled to
reimbursements for portfolio management, legal and accounting services.
Such costs for 1999 were $33,650, $16,817 and $232, respectively, of which
$11,980 was unpaid at December 31, 1999.

In addition to the Partnership, JMB was a 20% shareholder in each of
Carlyle Investors, Inc. and Carlyle Managers, Inc. and had obligations,
which bore interest ranging from 4.62% to 5.35% per annum in 1999, to fund,
on demand $200,000 and $200,000 to Carlyle Investors, Inc. and Carlyle
Managers, Inc., respectively, of additional paid-in capital. In June 1999,
the shareholdings of JMB in each of Carlyle Investors, Inc. and Carlyle
Managers, Inc. were redeemed and the obligation of JMB to fund additional
paid-in capital (totaling approximately $632,000 at June 15, 1999) was
fully retired.

<PAGE>

<TABLE>
<CAPTION>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

(a) No person or group is known by the Partnership to own beneficially more than 5% of the outstanding
Interests of the Partnership.

(b) The Corporate General Partner, its executive officers and directors and the Associate General Partner
beneficially own the following Interests of the Partnership:

NAME OF AMOUNT AND NATURE
BENEFICIAL OF BENEFICIAL PERCENT
TITLE OF CLASS OWNER OWNERSHIP OF CLASS
- -------------- ---------- ----------------- --------
<S> <C> <C> <C>
Limited Partnership
Interests JMB Realty Corporation 5 Interests directly (1) Less than 1%

Limited Partnership
Interests Corporate General 59.99897 Interests Less than 1%
Partner, its executive directly (1)(2)
officers and directors
and the Associate General
Partner as a group
<FN>

(1) Includes 5 Interests owned by JMB Realty Corporation, for which it is deemed to have sole voting and
investment power.

(2) Includes 54.99897 Interests owned by certain executive officers for which each such officer has sole
investment and voting power as to such Interests so owned.

No officer or director of the Corporate General Partner of the Partnership possesses a right to acquire
beneficial ownership of Interests of the Partnership.

Reference is made to Item 10 for information concerning ownership of the Corporate General Partner.

(c) There exists no arrangement, known to the Partnership, the operation of which may at a subsequent date
result in a change in control of the Partnership.

</TABLE>

<PAGE>

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

There were no significant transactions or business relationships with
the Corporate General Partner, affiliates or their management other than
those described in Items 10 and 11 above.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) The following documents are filed as part of this report:

(1) Financial Statements (See Index to Financial Statements
filed with this annual report).

(2) Exhibits.

3-A.* Amended and Restated Agreement of Limited
Partnership set forth as Exhibit A to the Prospectus, and which is hereby
incorporated by reference.

3-B. Acknowledgement of rights and duties of the
General Partners of the Partnership between ABPP Associates, L.P. (a
successor Associated General Partner of the Partnership) and JMB Realty
Corporation as of December 31, 1995 is hereby incorporated herein by
reference to the Partnership's Report for September 30, 1996 on Form 10-Q
(File No. 0-12791) dated November 8, 1996.

10-A. Agreement of Limited Partnership of Carlyle-XIII
Associates L.P. is hereby incorporated by reference to the Partnership's
Report on Form 10-Q (File No. 0-12791) dated May 14, 1993.

10-B. Second Amended and Restated Articles of
Partnership of JMB/NYC Office Building Associates, L.P. are hereby
incorporated herein by reference to the Partnership's Report on Form 10-K
(File No. 0-12791) for December 31, 1993 dated March 28, 1994.

10-C. Amended and Restated Certificate of Incorporation
of Carlyle-XIV Managers, Inc., are hereby incorporated herein by reference
to the Partnership's Report on Form 10-K (File No. 0-12791) for December
31, 1993 dated March 28, 1994.

10-D. Amended and Restated Certificate of Incorporation
of Carlyle-XIII Managers, Inc., are hereby incorporated herein by reference
to the Partnership's Report on Form 10-K (File No. 0-12791) for December
31, 1993 dated March 28, 1994.

10-E. $600,000 demand note between Carlyle-XIII
Associates, L.P. and Carlyle Managers, Inc., are hereby incorporated herein
by reference to the Partnership's Report on Form 10-K (File No. 0-12791)
for December 31, 1993 dated March 28, 1994.

<PAGE>

10-F. $600,000 demand note between Carlyle-XIII
Associates, L.P. and Carlyle Investors, Inc., are hereby incorporated
herein by reference to the Partnership's Report on Form 10-K (File No. 0-
12791) for December 31, 1993 dated March 28, 1994.

10-G. Amendment No. 1 to the Agreement of Limited
Partnership of Carlyle-XIII Associates, L.P. is hereby incorporated by
reference to the Partnership's Report for March 31, 1995 on Form 10-Q (File
No. 0-12791) dated May 11, 1995.

10-H. Amendment No. 1 to the Second Amended and
Restated Articles of Partnership of JMB/NYC Office Building Associates,
L.P. is hereby incorporated by reference to the Partnership's Report for
March 31, 1995 on Form 10-Q (File No. 0-12791) dated May 11, 1995.

10-I. Consent of Director of Carlyle-XIV Managers, Inc.
(known as Carlyle Managers, Inc.) dated October 31, 1996 is hereby
incorporated by reference to the Partnership's Report for December 31, 1996
on Form 10-K (File No. 0-12791) dated March 21, 1997.

10-J. Consent of Director of Carlyle-XIII, Managers,
Inc. (known as Carlyle Investors, Inc.) dated October 31, 1996 is hereby
incorporated by reference to the Partnership's Report for December 31, 1996
on Form 10-K (File No. 0-12791) dated March 21, 1997.

10-K. Allonge to demand note between Carlyle Real
Estate Limited Partnership - XIII and Carlyle Managers, Inc. dated October
31, 1996 is hereby incorporated by reference to the Partnership's Report
for December 31, 1996 on Form 10-K (File No. 0-12791) dated March 21, 1997.

10-L. Allonge to demand note between Carlyle Real
Estate Limited Partnership - XIII and Carlyle Investors, Inc., dated
October 31, 1996 is hereby incorporated by reference to the Partnership's
Report for December 31, 1996 on Form 10-K (File No. 0-12791) dated March
21, 1997.

10-M. Indemnification agreement between Property
Partners, L.P., Carlyle-XIII Associates, L.P. and Carlyle-XIV Associates,
L.P. dated as of October 10, 1996 is hereby incorporated by reference to
the Partnership's Report for December 31, 1996 on Form 10-K (File No. 0-
12791) dated March 21, 1997.

10-N. Agreement of Limited Partnership of 237/1290
Lower Tier Associates, L.P. dated as of October 10, 1996 is hereby
incorporated by reference to the Partnership's Report for December 31, 1996
on Form 10-K (File No. 0-12791) dated March 21, 1997.

<PAGE>

10-O. Amended and Restated Limited Partnership
Agreement of 237/1290 Upper Tier Associates, L.P. dated as of October 10,
1996 is hereby incorporated by reference to the Partnership's Report for
December 31, 1996 on Form 10-K (File No. 0-12791) dated March 21, 1997.

10-P Purchase Agreement and amendments thereto between
Sherry Lane Associates and Cottonwood Realty Services, L.L.C. dated July 7,
1997 is incorporated herein by reference to the Partnership's Report for
September 12, 1997 on Form8-K (file No. 0-12791) dated September 26, 1997.

10-Q Purchase Agreement and amendments thereto between
Carlyle Real Estate Limited Partnership - XIII and Parkway Properties, L.P.
dated August 20, 1997 is incorporated herein by reference to the
Partnership's Report for September 19, 1997 on Form 8-K (File No. 0-12791)
dated October 3, 1997.

10-R Purchase Agreement and Joint Escrow Instructions
between Carlyle Real Estate Limited Partnership - XIII and GDA Real Estate
Services, Inc. dated August 4, 1997 is incorporated herein by reference to
the Partnership's Report for October 15, 1997 on Form 8-K (File No. 0-
12791) dated October 30, 1997.

10-S Letter agreement related to the Purchase
Agreement between Carlyle Real Estate Limited Partnership - XIII and GDA
Real Estate Services, Inc. dated September 3, 1997 is incorporated herein
by reference to the Partnership's Report for October 15, 1997 on Form 8-K
(File No. 0-12791) dated October 30, 1997.

10-T Assignment of Limited Partnership Interest by
Carlyle Real Estate Limited Partnership - XIII dated March 2, 1998 is
incorporated herein by reference to the Partnership's Report for March 2,
1998 on Form 8-K (File No. 0-12791) dated March 16, 1998.

10-U Conveyance and Settlement Agreement between RVM
Long Beach Plaza LLC and Carlyle Real Estate Partnership - XIII dated
December 15, 1998 is incorporated herein by reference to the Partnership's
Report for December 31, 1998 on Form 8-K (File No. 0-12791) dated January
12, 1999.

10-V Loan Pay-Off Agreement between Trizechahn
Developments Inc. and Carlyle Real Estate limited Partnership - XIII dated
December 13, 1999 is hereby filed herewith.

10-W. Restructuring Agreement related to 237/1290 Upper
Tier Associates, L.P. dated October 27, 1999 is filed herewith.

10-X. Contribution Agreement between 237/120 Upper Tier
Associates, L.P. and Oak Hill Strategic Partners, L.P. is filed herewith.

<PAGE>

10-Y. Amendment and Release Agreement by and among
Metropolis Realty Trust, Inc. Property Partners, L.P., Carlyle Associates-
XIII Associates, L.P. and Carlyle-XIV Associates, L.P. is filed herewith.

10-Z. Third Amended and Restated Partnership Agreement
of 237/1290 Upper Tier Associates, L.P. by and between 237/1290 Upper Tier
GP Corp. Carlyle Managers, Inc., a JMB/NYC Office Building Associates, L.P.
dated November 19, 1999 is filed herewith.

10-AA. Intercreditor Agreement among Michigan Avenue
L.L.C., Carlyle-XIII Associates, L.P. Carlyle-XIV Associates, L.P. and
Property Partners, L.P. dated November 19, 1999 is filed herewith.

21. List of Subsidiaries.

24. Powers of Attorney.

27. Financial Data Schedule.

Although certain additional long-term debt instruments of
the Registrant have been excluded from Exhibit 4 above, pursuant to Rule
601(b)(4)(iii), the Registrant commits to provide copies of such agreements
to the SEC upon request.

(b) No reports on Form 8-K were filed since the beginning of
the last quarter of the period covered by this report.

----------------

* Previously filed as Exhibits 3, 4-C and 4-D, respectively, to
the Partnership's Report for December 31, 1992 on Form 10-K to the
Securities Exchange Act of 1934 (File No. 0-12791) dated March 30, 1993 are
hereby incorporated herein by reference.

No annual report or proxy material for the fiscal year 1999 has been
sent to the Partners of the Partnership. An annual report will be sent to
the Partners subsequent to this filing.

<PAGE>

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Partnership has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII

By: JMB Realty Corporation
Corporate General Partner

GAILEN J. HULL
By: Gailen J. Hull
Senior Vice President
Date: March 24, 2000

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

By: JMB Realty Corporation
Corporate General Partner

JUDD D. MALKIN*
By: Judd D. Malkin, Chairman and
Chief Financial Officer
Date: March 24, 2000

NEIL G. BLUHM*
By: Neil G. Bluhm, President and Director
Date: March 24, 2000

H. RIGEL BARBER*
By: H. Rigel Barber, Chief Executive Officer
Date: March 24, 2000

GAILEN J. HULL
By: Gailen J. Hull, Senior Vice President
Principal Accounting Officer
Date: March 24, 2000

By: A. LEE SACKS*
A. Lee Sacks, Director
Date: March 24, 2000

By: STUART C. NATHAN*
Stuart C. Nathan, Executive Vice President
and Director
Date: March 24, 2000

*By: GAILEN J. HULL, Pursuant to a Power of Attorney

GAILEN J. HULL
By: Gailen J. Hull, Attorney-in-Fact
Date: March 24, 2000

<PAGE>

CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII

EXHIBIT INDEX

Document
Incorporated
By Reference Page
------------ ----
3-A. Amended and Restated Agreement of
Limited Partnership set forth as
Exhibit A to the Prospectus Yes

10-A. Agreement of Limited Partnership of
Carlyle-XIII Associates L.P. Yes

10-B. Second Amended and Restated Articles
of Partnership of JMB/NYC Office
Building Associates, L.P. Yes

10-C. Amended and Restated Certificate
of Incorporation of Carlyle-XIV
Managers, Inc. Yes

10-D. Amended and Restated Certificate
of Incorporation of Carlyle-XIII
Managers, Inc. Yes

10-E. $600,000 demand note between
Carlyle-XIII Associates, Ltd. and
Carlyle Managers, Inc. Yes

10-F. $600,000 demand note between
Carlyle-XIII Associates, Ltd. and
Carlyle Investors, Inc. Yes

10-G. Amendment No. 1 to Carlyle-XIII
Associates Yes

10-H. Amendment No. 1 to JMB/NYC Office
Building Associates, L.P. Yes

10-I. Consent of Director of Carlyle-XIV
Managers, Inc. (known as Carlyle
Managers, Inc.) dated October 31,
1996 Yes

10-J. Consent of Director of Carlyle-XIII,
Managers, Inc. (known as Carlyle
Investors, Inc.) dated October 31,
1996 Yes

10-K. Allonge to demand note between
Carlyle Real Estate Limited
Partnership-XIII and Carlyle
Managers, Inc. dated October 31,
1996 Yes

10-L. Allonge to demand note between
Carlyle Real Estate Limited
Partnership-XIII and Carlyle
Investors, Inc., dated
October 31, 1996 Yes

<PAGE>

Document
Incorporated
By Reference Page
------------ ----

10-M. Indemnification agreement between
Property Partners, L.P., Carlyle-XIII
Associates, L.P. and Carlyle-XIV
Associates, L.P. dated as of
October 10, 1996 Yes

10-N. Agreement of Limited Partnership of
237/1290 Lower Tier Associates, L.P.
dated as of October 10, 1996 Yes

10-0. Amended and Restated Limited
Partnership of 237/1290 Upper
Tier Associates, L.P. dated
as of October 10, 1996 Yes

10-P. Purchase Agreement and amendments
thereto between Sherry Lane
Associates and Cottonwood Realty
Services, L.L.C. dated as of
July 7, 1997 Yes

10-Q. Purchase Agreement and amendments
thereto between Carlyle Real Estate
Limited Partnership - XIII and
Parkway Properties, L.P. dated
as of August 20, 1997 Yes

10-R. Purchase Agreement and Joint Escrow
Instructions between Carlyle Real
Estate Limited Partnership - XIII and
GDA Real Estate Services, Inc. dated
August 4, 1997 Yes

10-S. Letter of Agreement related to the
Purchase Agreement between Carlyle
Real Estate Limited Partnership - XIII
and GDA Real Estate Services, Inc.
dated September 3, 1997 Yes

10-T. Assignment of Limited Partnership
Interest by Carlyle Real Estate
Limited Partnership - XIII dated
March 2, 1998 Yes

10-U. Conveyance and Settlement Agreement
between RVM Long Beach Plaza LLC
and Carlyle Real Estate Partnership -
XIII dated December 15, 1998 Yes

10-V. Loan Pay-Off Agreement between
Trizechahn Developments, Inc. and
Carlyle Real Estate Partnership - XIII
dated December 13, 1999 No

10-W. Restructuring Agreement related to
237/1290 Upper Tier Associates, L.P.
dated October 27, 1999 No

10-X. Contribution Agreement between
237/120 Upper Tier Associates, L.P.
and Oak Hill Strategic Partners, L.P. No

<PAGE>

DOCUMENT
INCORPORATED
BY REFERENCE PAGE
------------- ----
10-Y. Amendment and Release Agreement by
and among Metropolis Realty Trust, Inc.
Property Partners, L.P., Carlyle
Associates-XIII Associates, L.P. and
Carlyle-XIV Associates, L.P. No

10-Z. Third Amended and Restated Partnership
Agreement of 237/1290 Upper Tier
Associates, L.P. by and between
237/1290 Upper Tier GP Corp. Carlyle
Managers, Inc., a JMB/NYC Office
Building Associates, L.P. dated
November 19, 1999 No

10-AA. Intercreditor Agreement among
Michigan Avenue L.L.C., Carlyle-XIII
Associates, L.P. Carlyle-XIV Associates,
L.P. and Property Partners, L.P.
dated November 19, 1999 No

21. List of Subsidiaries No

24. Powers of Attorney No

27. Financial Data Schedule No

- ------------------

* Previously filed as exhibits to the Partnership's Registration
Statement on Form S-11 (as amended) under the Securities Exchange Act of
1933 and the Partnership's prior Reports on Form 8-K and Form 10-K of the
Securities Exchange Act of 1934.

EXHIBIT 10-V
- ------------

LOAN PAY-OFF AGREEMENT
----------------------

THIS LOAN PAY-OFF AGREEMENT ("Agreement") is made and entered
into as of the __ day of December, 1999, by and between TRIZECHAHN
DEVELOPMENTS INC., a California corporation, as successor-in-interest to
Ernest W. Hahn, Inc. ("Lender"), and CARLYLE REAL ESTATE LIMITED
PARTNERSHIP-XIII, an Illinois limited partnership ("Borrower").

RECITALS
--------

A. Lender made a loan (the "Loan") in the principal amount of
$20,225,000.00 to Borrower. The Loan is evidenced by the "Note" (described
on Exhibit A). The Loan had been secured by the "Deed of Trust" (described
on Exhibit A) and the "Spreader Agreement" (described on Exhibit A), which
Deed of Trust and Spreader Agreement were released and reconveyed pursuant
to the "Full Reconveyance" (described on Exhibit A). The Note, the Deed of
Trust, the Spreader Agreement and the Full Reconveyance, and the other
documents and instruments executed by Borrower evidencing, securing or
otherwise relating to the Loan are hereinafter collectively referred to as
the "Loan Documents".

B. Borrower has requested that Lender accept less than the
outstanding principal balance of the Loan in repayment of the Loan. Lender
has agreed to such request on terms and subject to the conditions
hereinafter set forth.

NOW, THEREFORE, in consideration of the foregoing premises, the
mutual covenants and conditions contained herein, Borrower and Lender
hereby agree as follows:

1. REPAYMENT OF LOAN. Borrower shall prepay (and fully satisfy)
the Loan by paying to Lender $3,000,000.00 (the "Pay-Off Amount").

2. CLOSING.

A. CLOSING DATE. The closing (the "Closing") of the pay-off
of the Loan shall be on a date mutually agreed upon by the parties hereto
but not later than December 22, 1999 (the "Closing Date").

B. CLOSING COSTS. Each party shall pay all costs, fees,
charges and expenses of whatever kind or character incurred by it in
connection with the preparation and negotiation of all documentation for,
and the consummation of, the transactions contemplated by this Agreement.

3. DELIVERIES TO OTHER PARTY AT CLOSING. Borrower and Lender
shall deliver or cause to be delivered to each other the following items:

A. BY LENDER. Lender shall deliver the original Note marked
"paid in full" (or a lost note affidavit if the original Note is
unavailable) to Ernie Park, Esq. at the following address: c/o Bewley,
Lassleben & Miller, 510 Whittier Square, 13215 East Penn Street, Whittier,
California, 90602.

B. BY BORROWER. Upon the written confirmation by Ernie
Park, Esq. of his receipt of the document set forth in Paragraph 3.A.
above, Borrower shall deliver or cause to be delivered to Lender, in time
for the Closing to occur on the Closing Date, the Pay-Off Amount by wire
transfer or other immediately available funds pursuant to Lender's
instructions.

<PAGE>

C. DELIVERY OF DOCUMENT. Immediately upon Lender's receipt
of the Pay-Off Amount, Lender shall direct Ernie Park, Esq. to deliver the
document set forth in Paragraph 3.A. above to Borrower.

4. CONDITIONS TO CLOSE. The obligations of Lender and Borrower to
close this transaction shall be subject to the other performing, satisfying
and complying with all covenants, agreements and conditions required by
this Agreement to be performed or complied with by the other party.

5. RELEASE BY LENDER.

A. RELEASE. If and only if the Closing occurs, upon the
Closing, Lender, on its own behalf and on behalf of its employees,
officers, shareholders, directors, agents, successors, assigns, partners,
attorneys, agents, servants, parent, subsidiary and affiliate corporations,
hereby absolutely and irrevocably releases Borrower, and each of Borrower's
beneficiaries and certificate holders and each of their respective
trustees, partners, attorneys, officers, directors, representatives,
agents, servants, contractors, employees, parent, subsidiary and affiliate
corporations and predecessors-in-interest, and each of their respective
past and present partners, successors, heirs and assigns, and each of them
(collectively, the "Borrower Released Parties") from any and all claims,
rights, demands, suits, causes of actions, losses, costs, obligations,
liabilities and expenses (collectively, "Claims") of every kind or nature,
known or unknown, suspected or unsuspected, fixed or contingent, arising
out of or relating to any statements, representations, acts or omissions,
intentional, willful, negligent or innocent, by any of the Borrower
Released Parties in any way connected with, relating to or affecting,
directly or indirectly, the Loan, the Loan Documents or the relationship
between Lender and Borrower.

B. NON-RELIANCE. Lender hereby acknowledges that it has not
relied upon any representation of any kind made by Borrower or any of the
Borrower Released Parties in making the foregoing release.

C. CIVIL CODE. Lender is aware of the provisions of
Section 1542 of the California Civil Code, which Section reads as follows:

A general release does not extend to claims which the creditor
does not know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his settlement
with the debtor.

Lender waives the provisions of said Section 1542 of the California Civil
Code and the provisions of any other applicable laws restricting the
release of claims which the releasing parties do not know or suspect to
exist at the time of release, which, if known, would have materially
affected the decision of Lender to agree to this Agreement.

D. NO ADMISSION OF LIABILITY. It is hereby further
understood and agreed that the acceptance of delivery of this Agreement by
the parties released hereby shall not be deemed or construed as an
admission of liability of any nature whatsoever arising from or related to
the subject of this Agreement.

6. RELEASE BY BORROWER.

A. RELEASE. If and only if the Closing occurs, upon the
Closing, Borrower, on its own behalf and on behalf of its employees,
officers, shareholders, directors, agents, successors, assigns, partners,
attorneys, agents, servants, parent, subsidiary and affiliate corporations,
hereby absolutely and irrevocably releases Lender, and each of Lender's
beneficiaries, shareholders, partners, attorneys, officers, directors,
representatives, agents, servants, contractors, employees, parent,
subsidiary and affiliate corporations and predecessors-in-interest, and
each of their respective past and present partners, successors, heirs and

<PAGE>

assigns, and each of them (collectively, the "Lender Released Parties")
from any and all Claims of every kind or nature, known or unknown,
suspected or unsuspected, fixed or contingent, arising out of or relating
to any statements, representations, acts or omissions, intentional,
willful, negligent or innocent, by any of the Lender Released Parties in
any way connected with, relating to or affecting, directly or indirectly,
the Loan, the Loan Documents or the relationship between Lender and
Borrower.

B. NON-RELIANCE. Borrower hereby acknowledges that it has
not relied upon any representation of any kind made by Lender or any of the
Lender Released Parties in making the foregoing release.

C. CIVIL CODE. Borrower is aware of the provisions of
Section 1542 of the California Civil Code, which Section reads as follows:

Borrower waives the provisions of said Section 1542 of the California Civil
Code and the provisions of any other applicable laws restricting the
release of claims which the releasing parties do not know or suspect to
exist at the time of release, which, if known, would have materially
affected the decision of Borrower to agree to this Agreement.

7. FURTHER INSTRUMENTS. Borrower and Lender, when requested to do
so by another party to this Agreement, shall cause to be executed,
acknowledged or delivered any and all such further instruments and
documents as may be reasonably necessary or proper to carry out the intent
and purpose of this Agreement.

8. GOVERNING LAW. This Agreement shall be construed and enforced
in accordance with the laws of the State of California (without taking into
account conflicts of law).

9. AMENDMENTS. This Agreement may be amended by written agreement
of amendment executed by all parties, but not otherwise.

10. ATTORNEYS' FEES. If any action or proceeding is commenced to
enforce any of the terms of this Agreement, the prevailing party will have
the right to recover its reasonable attorneys' fees and costs of such
action or proceeding from the other party.

11. ENTIRE AGREEMENT. This Agreement (and all exhibits attached
hereto, which are hereby incorporated herein by this reference) contains
the entire agreement between the parties respecting the matters herein set
forth and supersedes all prior agreements between the parties hereto
respecting such matters.

12. SEVERABILITY. If any term or provision of this Agreement is
construed or interpreted by a court of competent jurisdiction to be void,
invalid or unenforceable, such decision shall affect only those paragraphs,
clauses or provisions so construed or interpreted and shall not affect the
remaining paragraphs, clauses and provisions of this Agreement.

13. TIME OF ESSENCE. Time is of the essence of this Agreement.

[Remainder of Page Intentionally Blank]

<PAGE>

COUNTERPARTS. This Agreement may be executed in any number of
counterparts so long as each signatory hereto executes at least one such
counterpart. Each such counterpart shall constitute one original, but all
such counterparts taken together shall constitute one and the same
instrument.

IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.

BORROWER

CARLYLE REAL ESTATE LIMITED PARTNERSHIP-XIII,
an Illinois limited partnership

By: JMB REALTY CORPORATION,
a Delaware corporation,
General Partner

By:
------------------------------
Name: Andrea Pauls Backman
Title: Senior Vice President

LENDER

TRIZECHAHN DEVELOPMENTS INC.,
a California corporation

By:
------------------------------
Name:
------------------------------
Title:
------------------------------

<PAGE>

EXHIBIT "A"

LOAN DOCUMENTS
--------------

1. Promissory Note Secured by Deed of Trust (the "Note") by
Borrower to Lender.

2. Long Term Deed of Trust and Assignment of Rents (the "Deed of
Trust") between Borrower, Title Insurance and Trust Company, a California
corporation, and Lender dated June 22, 1983, and recorded June 24, 1983 as
Instrument No. 83-711204.

3. Deed of Trust Spreader Agreement (the "Spreader Agreement") by
Borrower dated June 22, 1983 and recorded March 15, 1984.

4. Full Reconveyance (the Full Reconveyance") by Ticor Title
Insurance Company of California, formerly Title Insurance and Trust
Company, as duly appointed Trustee under the Deed of Trust, dated June 29,
1984, and recorded June 29, 1984 as Instrument No. 84-784753.

EXHIBIT 10-W
- ------------

RESTRUCTURING AGREEMENT

THIS RESTRUCTURING AGREEMENT (this "Agreement") is entered into
as of the 27th day of October, 1999, by and among OAK HILL STRATEGIC
PARTNERS, L.P., a Delaware limited partnership ("OHSP"), 237/1290 UPPER
TIER ASSOCIATES, L.P., a Delaware limited partnership ("UTLP"); 237/1290
UPPER TIER GP CORP., a Delaware corporation ("UTLP GP Corp."); 237 GP
CORP., a Delaware corporation ("237 GP Corp."), JMB/NYC OFFICE BUILDING
ASSOCIATES, L.P., an Illinois limited partnership ("JMB/NYC"); PROPERTY
PARTNERS, L.P., a Delaware limited partnership ("Property Partners");
CARLYLE-XIII ASSOCIATES, L.P., a Delaware limited partnership ("Carlyle
XIII"); CARLYLE-XIV ASSOCIATES, L.P., a Delaware limited partnership
("Carlyle XIV"); CARLYLE MANAGERS, INC., a Delaware corporation ("JMB/NYC
Special"); 237 PARK PARTNERS, L.P., a Delaware limited partnership ("237
Park L.P."); 1290 PARTNERS, L.P., a Delaware limited partnership ("1290
L.P."); 1290 GP CORP., a Delaware corporation ("1290 GP Corp."); METROPOLIS
REALTY TRUST, INC., a Maryland Corporation ("Metropolis") and, solely for
the purpose of agreeing to certain obligations set forth in Sections
4.02(b) and (d) hereof, FW STRATEGIC ASSET MANAGEMENT, L.P. ("FW
Strategic"), a Texas limited partnership (collectively, the "Parties").

WHEREAS, Metropolis holds a 95% interest as the general partner
of 237/1290 Lower Tier Associates, L.P., a Delaware limited partnership
("LTLP"), which owns (x) a 99% interest as limited partner in 237 Park
L.P., which owns a direct interest in that certain property known as 237
Park Avenue, New York, New York (together with all related personal
property, intangibles, improvements and fixtures, the "237 Property"), and
(y) a 99% interest as a limited partner in 1290 L.P., which owns a direct
interest in that certain property known as 1290 Avenue of the Americas, New
York, New York (together with all related personal property, intangibles,
improvements and fixtures, "1290 Sixth"); and

WHEREAS, UTLP holds a 5% interest as the limited partner of
LTLP; and

WHEREAS, it is intended that 237 Park L.P. shall be converted
into a Delaware limited liability company ("237 Park LLC"); and

WHEREAS, it is intended that following such conversion,
Metropolis and UTLP shall cause LTLP to liquidate, and pursuant to such
liquidation, each of Metropolis and UTLP shall receive an in-kind
distribution of its pro rata portion of LTLP's interests in 237 Park LLC
and 1290 L.P.; and

WHEREAS, Metropolis and 237 GP Corp, as sellers, and 237 Park
Investors, L.L.C. (an affiliate of OHSP), as buyer, have entered into the
Interest Purchase Agreement (as defined below) pursuant to which 237 Park
Investors, L.L.C. will acquire the respective interests of Metropolis and
237 GP Corp in 237 Park LLC (following the conversion); and

WHEREAS, UTLP and OHSP desire to enter into a Contribution
Agreement (the "Contribution Agreement") in connection with UTLP's
contribution of its membership interest in 237 Park LLC for Class A
Partnership Units in OHSP (the "UTLP OHSP Units") as more particularly
described herein; and

WHEREAS, the JMB/NYC Partners (as defined below) and Metropolis
desire to enter into an Amendment and Release Agreement (the "Amendment and
Release Agreement") relating to the Indemnification Agreement (as defined
below) in connection with the transactions contemplated by this Agreement
and the Interest Purchase Agreement.

<PAGE>

NOW, THEREFORE, in consideration of the mutual terms, covenants
and conditions herein contained, and for other good, valid and binding
consideration (including, without limitation, the terms, covenants and
conditions set forth in the Interest Purchase Agreement), the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:

SECTION 1

DEFINITIONS

When used herein, the following capitalized terms shall have
the following meanings:

"Agreement" shall have the meaning set forth in the first
paragraph hereof.

"Amendment and Release Agreement" shall have the meaning set
forth in the recitals hereto.

"Closing" shall have the meaning set forth in Section 2.02
hereof.

"Closing Date" shall have the meaning set forth in Section 2.02
hereof.

"Closing Transactions" shall have the meaning set forth in
Section 2.01 hereof.

"Code" shall mean the Internal Revenue Code of 1986, as
amended.

"Confidential Information" shall have the meaning set forth in
Section 4.06(a) hereof.

"Contribution Agreement" shall have the meaning set forth in
the recitals hereto.

"Effective Time" shall have the meaning set forth in Section
2.02 hereof.

"Fair Market Value" shall have the meaning set forth in Section
5.5 of the OHSP Partnership Agreement.

"FW Strategic" shall have the meaning set forth in the first
paragraph hereof.

"Indemnifiable Action" shall have the meaning set forth in
Section 7.02(a)(ii) hereof.

"Indemnification Agreement" shall mean that certain
Indemnification Agreement dated as of October 10, 1996 by and among the
JMB/NYC Partners and Metropolis.

"Interest Purchase Agreement" shall mean that certain Interest
Purchase Agreement, by and among 237 Park Investors L.L.C., Metropolis
Reality Trust, Inc. and 237 GP Corp., dated as of September 23, 1999, as
the same was modified by letters dated October 6, 1999, October 13, 1999,
October 14, 1999, and October 18, 1999, and by an Amendment No. 4 to
Interest Purchase Agreement dated October 15, 1999, as the same may be
further modified or amended from time to time.

"JMB/NYC Controlled Entity" shall mean JMB/NYC, its partners
(including, without limitation, any Indemnitor), stockholders, agents or
affiliates.

<PAGE>

"JMB/NYC" shall have the meaning set forth in the first
paragraph of this Agreement.

"JMB/NYC Indemnifiable Action" shall have the meaning set forth
in Section 7.02(a)(i) hereof.

"JMB/NYC Partners" shall mean Property Partners, Carlyle XIII
and Carlyle XIV.

"JMB/NYC Special" shall have the meaning set forth in the first
paragraph of this Agreement.

"Losses" shall mean any and all losses, claims, liabilities,
damages, costs or expenses (including, without limitation, reasonable
counsel fees) of any nature whatsoever, contingent or otherwise, foreseen
or unforeseen.

"LTLP" shall have the meaning set forth in the recitals hereto.

"LTLP LP Agreement" shall mean that certain Agreement of
Limited Partnership of 237/1290 Lower Tier Associates, L.P., dated as of
October 10, 1996, and entered into by and between Metropolis and UTLP.

"Metropolis" shall have the meaning set forth in the first
paragraph hereof.

"New 237 Park Indebtedness" shall mean any non-recourse
indebtedness secured by the 237 Property or by an interest in a limited
liability company which is directly or indirectly wholly-owned by 237 Park
LLC and through which the 237 Property is wholly owned (or any refinancing
thereof), which indebtedness shall constitute a "nonrecourse liability"
allocable to UTLP pursuant to U.S. Treasury regulation section 1.752-
1(a)(2) and shall qualify as qualified non-recourse financing within the
meaning of Section 465(b)(6) of the Code.

"OHSP Adverse Transaction" shall mean (i) any sale,
disposition, transfer or exchange of the 237 Property, or of any of OHSP's
interests in the 237 Park Entities, (ii) any release, discharge or
reduction of New 237 Park Indebtedness of the 237 Park Entities below $200
million (other than through actions taken by a secured lender such as
application of insurance proceeds or condemnation awards or the exercise of
remedies, or in the case where the released indebtedness is concurrently
being replaced with other non-recourse indebtedness complying with
clause (B) below), (iii) any distribution of the assets of the 237 Park
Entities (other than distributions of cash and other distributions by the
237 Park Entities in the ordinary course of business), or (iv) any other
transaction or agreement to which OHSP or the 237 Park Entities is a party,
if as a result of any such transaction or agreement described in (i), (ii),
(iii), or (iv) above, JMB/NYC would be required to recognize a material
amount of taxable income or gain prior to the earlier of (1) the exercise
by FW Strategic of the right set forth in Section 4.02(c) hereof and the
receipt by JMB/NYC, in accordance with Section 4.02(e), of all amounts to
be received under such Section 4.02(c), and (2) the exercise by JMB/NYC of
the right set forth in the proviso of Section 4.02(d)(ii) hereof and the
receipt by JMB/NYC, in accordance with Section 4.02(e), of all amounts to
be received under such Section 4.02(d). "OHSP Adverse Transactions" shall
specifically exclude (A) distribution of income of the 237 Park Entities
or OHSP derived in the ordinary course of the 237 Park Entities' business,
(B) incurrence of New 237 Park Indebtedness of the properties owned by the
237 Park Entities on commercially reasonable terms in an aggregate amount
equal to not less than $200,000,000, (C) payment of amortization on non-
recourse financing encumbering the assets owned by the 237 Park Entities,
provided that the outstanding balance of such financing is not reduced
below $200,000,000, in the aggregate, between the date hereof and the
earlier of (1) the exercise by FW Strategic of the right set forth in
Section 4.02(c) hereof and the receipt by JMB/NYC, in accordance with
Section 4.02(e), of all amounts to be received under such Section 4.02(c),

<PAGE>

and (2) the exercise by JMB/NYC of the right set forth in the proviso of
Section 4.02(d)(ii) hereof and the receipt by JMB/NYC, in accordance with
Section 4.02(e), of all amounts to be received under such Section 4.02(d),
and other repayments of principal as described in the parenthetical of
clause (ii) above (i.e., actions taken by a secured lender such as
application of insurance proceeds or condemnation awards or the exercise of
remedies, or in the case where the released indebtedness is concurrently
being replaced with other non-recourse indebtedness complying with
clause (B) above), (D) a transfer of the 237 Property owned by any of the
237 Park Entities pursuant to an involuntary foreclosure or similar action
arising from a default by any of the 237 Park Entities with respect to its
obligations under its indebtedness, (E) a transfer of the 237 Property to
any 237 Park Entity in connection with the obligations of any 237 Park
Entity under its indebtedness, and (F) a transfer of the 237 Property
pursuant to a voluntary foreclosure or similar action arising from a
default by any of the 237 Park Entities with respect to such entities'
obligations under the New 237 Park Indebtedness; provided that, in the case
of a consensual foreclosure or deed in lieu of foreclosure by reason of a
default under the New 237 Park Indebtedness (as defined pursuant to the
terms thereof), the default is a bona fide default and the foreclosure or
deed in lieu of foreclosure is not a collusive transaction between the
holders of the New 237 Park Indebtedness and 237 Park LLC, or any member
thereof or any affiliate of either, attributable to any commonality of
ownership between the beneficial ownership of the New 237 Park Indebtedness
and 237 Park LLC or any member thereof or any affiliate of either.

"OHSP" shall have the meaning set forth in the first paragraph
hereof.

"OHSP Indemnifiable Action" shall have the meaning set forth in
Section 7.02(a)(ii) hereof.

"OHSP Partnership Agreement" shall mean that certain agreement
of limited partnership relating to OHSP, as the same may be amended or
modified from time to time.

"Parties" shall have the meaning set forth in the first
paragraph hereof.

"Property Partners" shall have the meaning set forth in the
first paragraph of this Agreement.

"Representatives" shall have the meaning set forth in Section
4.06(a) hereof.

"Termination Date" shall have the meaning set forth in Section
6.01(b) hereof.

"Transaction Agreements" shall mean this Agreement, the
Contribution Agreement, the Amendment and Release Agreement, and the
Interest Purchase Agreement.

"1290 GP Corp." shall have the meaning set forth in the first
paragraph of this Agreement.

"1290 L.P." shall have the meaning set forth in the first
paragraph hereof.

"1290 LP Agreement" shall mean that certain agreement of
limited partnership relating to 1290 L.P., as the same may be amended or
modified from time to time.

"1290 Sixth" shall have the meaning set forth in the recitals
hereto.

"237 Book/Tax Amount" shall have the meaning set forth in
Section 4.02(a) hereof.

<PAGE>

"237 GP Corp." shall have the meaning set forth in the first
paragraph hereof.

"237 Park Entities" shall mean 237 Park LLC and any other
direct or indirect wholly-owned, single member, limited liability company
subsidiary of 237 Park LLC formed in connection with the New 237 Park
Indebtedness financing.

"237 Park LLC" shall have the meaning set forth in the recitals
hereto.

"237 Park L.P." shall have the meaning set forth in the
recitals hereto.

"237 Park Partners LP Agreement" shall mean that certain
agreement of limited partnership relating to 237 Park L.P., as the same may
be amended or modified from time to time.

"237 Property" shall have the meaning set forth in the recitals
hereto.

"UTLP" shall have the meaning set forth in the first paragraph
hereof.

"UTLP GP Corp." shall have the meaning set forth in the first
paragraph hereof.

"UTLP LP Agreement" shall mean that certain Second Amended and
Restated Limited Partnership Agreement of UTLP, dated as of October 14,
1997, entered into by and between UTLP GP Corp., JMB/NYC and JMB/NYC
Special.

"UTLP OHSP Units" shall have the meaning set forth in the
recitals hereto.

SECTION 2

CLOSING

2.01 Transactions on the Closing Date. Subject to the
terms and on the conditions of this Agreement, at or before Closing, each
of the following transactions (the "Closing Transactions") shall be
consummated in the following order (and only upon the completion of the
transaction set forth in the paragraph immediately prior to it):

(a) Conversion of 237 Park L.P. (i) LTLP, Metropolis, 237
GP Corp. and 237 Park L.P. shall, and LTLP, Metropolis and 237 GP Corp.
shall cause 237 Park L.P. to, (A) take all actions necessary in order to
effect the conversion of 237 Park L.P. from a Delaware limited partnership
to a Delaware limited liability company, and (B) immediately following such
conversion, appoint OHSP as the manager (and submit to OHSP the written
resignation of each other manager, if any) of 237 Park LLC, and amend its
certificate of formation to reflect such changes.

(ii) It is hereby expressly agreed by the Parties that, in
conjunction with, and to effectuate, the closing under the Interest
Purchase Agreement, OHSP shall have the right, in its sole discretion, to
amend, restate or otherwise modify the terms of the 237 Park Partners LP
Agreement and, upon the execution thereof, the limited liability company
agreement of 237 Park LLC.

(b) Amendments to the UTLP and 1290 LP Agreements. (i) The
UTLP LP Agreement shall be amended so that such agreement shall conform in
both form and substance to the form attached to this Agreement as Exhibit
A.

<PAGE>

(ii) The 1290 LP Agreement shall be amended so that such
agreement shall conform in both form and substance to the form attached to
this Agreement as Exhibit B.

(c) Liquidation. Metropolis, UTLP and UTLP GP Corp. shall
cause LTLP to liquidate in accordance with the terms of a liquidation
agreement attached hereto as Exhibit C, and in connection with such
liquidation, each of Metropolis and UTLP shall receive an in-kind
distribution of its pro rata portion of LTLP's interests in 237 Park LLC
and 1290 LP.

(d) Creation of 237 Park Entities; Transfer of 237 Property.
In accordance with the provisions of the Interest Purchase Agreement,
Metropolis, 237 GP Corp. and UTLP shall cause 237 Park LLC to, and 237 Park
LLC shall (x) form a subsidiary, which subsidiary shall at all times,
remain a direct or indirect wholly-owned subsidiary of 237 Park LLC; (y)
transfer ownership of the 237 Property to such subsidiary, and (z)
thereafter, form one or more additional subsidiaries as may be required by
the lenders in conjunction with the New 237 Park Indebtedness, which
additional subsidiaries shall at all times, remain direct or indirect
wholly-owned subsidiaries of 237 Park LLC. Such subsidiaries shall,
together with 237 Park LLC, constitute the 237 Park Entities as defined
herein.

(e) Contribution of 237 Park LLC Membership Interests.
Subsequent to the sale by Metropolis and 237 GP Corp. of their respective
partnership interests (or, following the conversion of 237 Park L.P., of
their respective membership interests) in 237 Park L.P. or 237 Park LLC, as
applicable, to 237 Park Investors, L.L.C., UTLP shall contribute its
membership interest in 237 Park LLC to OHSP as consideration for UTLP's
receipt of Class A Partnership Units in OHSP with a Fair Market Value and
initial Capital Account on the Closing Date of $505,050.

2.02 The Closing; Effective Time. The closing (the "Closing")
with respect to the Closing Transactions shall take place (i) at the same
time (the "Effective Time"), on the same date (the "Closing Date") and at
the same location of the closing under the Interest Purchase Agreement,
subject to satisfaction or waiver of the conditions set forth in Section 3
hereof, or (ii) at such other place, time and/or date as the Parties shall
mutually agree in writing.

SECTION 3

CONDITIONS TO CLOSING

The obligation of each Party to consummate the Closing
Transactions shall be conditioned as follows:

3.01 Subscription. It shall be a condition of OHSP's
obligation to close hereunder that, simultaneous to the occurrence of the
Closing Transactions as set forth above, UTLP shall be delivering to OHSP a
Contribution Agreement in the form set forth in Exhibit D hereto.

3.02 Closing Under Interest Purchase Agreement. It shall be a
condition of OHSP's, Metropolis's, UTLP's and JMB/NYC's obligation to close
hereunder that, simultaneous to the occurrence of the Closing Transactions
as set forth above, the closing of the purchase under the Interest Purchase
Agreement shall be occurring (and all conditions to such closing shall
either have been satisfied or waived).

3.03 Execution of the Amendment and Release Agreement. It
shall be a condition of JMB/NYC's obligation to close hereunder that,
simultaneous to the occurrence of the Closing Transactions as set forth
above, the execution and delivery of the Amendment and Release Agreement in
the form set forth in Exhibit E hereto by the JMB/NYC Partners and
Metropolis shall be occurring.

<PAGE>

3.04 Participation Extinguished. It shall be a condition of
JMB/NYC's obligation to close hereunder that, simultaneous to the
occurrence of the Closing Transactions as set forth above, Metropolis shall
assign its interest in (i) that certain Second Amended, Restated and
Consolidated Note, dated as of October 10, 1996, made by JMB/NYC in favor
of Metropolis in an original principal amount of $88,572,780 (a true and
correct copy of which is attached hereto as Exhibit F); (ii) that Second
Amended, Restated and Consolidated Security Agreement, dated as of October
10, 1996, between JMB/NYC and Metropolis; and (iii) that certain
Participation Agreement, dated as of October 10, 1996, between Metropolis
and Michigan Avenue, L.L.C., a Delaware limited liability company
("Michigan Avenue, LLC"), to Michigan Avenue, LLC.

3.05 Representations and Warranties; Covenants. It shall be a
condition of each Party's obligation to close hereunder, that, with respect
to each other Party:

(a) such Party's respective representations and warranties
contained in this Agreement shall be true at and as of the Effective Time
with the same effect as though made at and as of such time; provided,
however, that, with respect to representations and warranties which
expressly speak as of a different date, the same shall be true as of such
date.

(b) such Party shall have performed or complied in all
material respects with all agreements and covenants required by this
Agreement to be performed or complied with by it (and, with respect to
Section 2.01, such performance or compliance shall have occurred in the
appropriate order) on or before the Effective Time.

SECTION 4

COVENANTS AND AGREEMENTS

4.01 Pre-Closing Covenants and Agreements. After the date
hereof and prior to the Effective Time (unless otherwise agreed to in
writing by all of the Parties):

(a) JMB Consent. JMB/NYC, the JMB/NYC Partners and JMB/NYC
Special shall (and hereby do) expressly acknowledge, and grant their
unconditional consent and, as applicable, approval to, all of the Closing
Transactions expressly provided for in Section 2.01 hereof and all acts
which must be taken by any Party in connection therewith.

(b) [Intentionally Omitted]

4.02 Post-Closing Covenants and Agreements.

(a) OHSP will treat and report UTLP's Code Section 704(c)
book/tax difference with respect to UTLP's interest in OHSP (taking into
account the remedial allocation under Section 4.02(b)(ii)) as equal to
approximately $191,400,000 as of the Effective Time (the "237 Book/Tax
Amount").

(b) From the Closing Date to the earlier of (x) the exercise
by FW Strategic of the right set forth in Section 4.02(c) hereof, and the
receipt by JMB/NYC, in accordance with Section 4.02(e), of all amounts to
be received under Section 4.02(c), and (y) the exercise by JMB/NYC of the
right set forth in the proviso of Section 4.02(d)(ii) hereof, and the
receipt by JMB/NYC, in accordance with Section 4.02(e), of all amounts to
be received under Section 4.02(d)(ii):

<PAGE>

(i) Maintenance and Allocation of Indebtedness. OHSP shall,
or shall cause the 237 Park Entities to, (A) maintain outstanding New 237
Park Indebtedness in a principal amount equal at least to $200 million
which indebtedness shall qualify as qualified non-recourse financing
(within the meaning of section 465(b)(6)(B) of the Code); (B) report a
portion of the New 237 Park Indebtedness in a principal amount equal to not
less than the 237 Book/Tax Amount (as reduced each year by the amount
allocated to UTLP under the "remedial method" pursuant to clause (ii) of
this Section 4.02(b)) as being allocated to UTLP for U.S. federal income
tax purposes; (C) file all U.S. federal and state income tax returns in a
manner consistent with such allocation of the New 237 Park Indebtedness;
(D) report all of the liabilities allocated to UTLP as qualified non-
recourse financing (within the meaning of section 465(b)(6)(B) of the
Code); and (E) in preparing any income tax return, not make any statement
or file any attachment that indicates that there is more than one activity
with respect to the 237 Park Entities for purposes of section 465 of the
Code.

(ii) Election of Remedial Method. UTLP and JMB/NYC hereby
expressly recognize and agree that OHSP shall elect to make U.S. federal
income tax allocations in respect of the 237 Property in accordance with
the "remedial method" described in U.S. Treasury regulation section 1.704-
3(d). OHSP agrees that the effect of using the "remedial method" described
in U.S. Treasury regulation section 1.704-3(d) shall be that UTLP shall
receive an annual remedial income allocation from the 237 Property in an
amount equal to approximately $4,600,000.

(iii) OHSP Classification. OHSP shall be classified as a
partnership (and not as a publicly traded partnership) for federal income
tax purposes.

(c) FW Strategic Call Right. FW Strategic shall, upon ninety
(90) days' prior written notice to UTLP and JMB/NYC, have the continuing
right, exercisable at any time during the month of January of each calendar
year commencing with 2002, to purchase, or to cause its designee to
purchase, the UTLP OHSP Units free and clear of all liens, restrictions,
and encumbrances, for a cash amount (which cash amount shall not be reduced
or increased in any way in respect of any costs or fees imposed by any
Party) equal to the greater of the Fair Market Value of such UTLP OHSP
Units or $656,566.

(d) Non-Transferability and Non-Redeemability of the UTLP
OHSP Units and JMB/NYC Put Right. After the Effective Time:

(i) UTLP shall not in any way transfer, assign, sell,
abandon, hypothecate, pledge, exchange or otherwise dispose of or encumber
any of the UTLP OHSP Units or any interest therein without the consent of
OHSP, which consent may be withheld in OHSP's sole and absolute discretion.

(ii) notwithstanding any of the provisions of the OHSP
Partnership Agreement to the contrary, UTLP shall not have any rights to
redeem, or to cause the redemption of, the UTLP OHSP Units; provided,
however, that JMB/NYC shall, upon ninety (90) days' prior written notice to
UTLP, FW Strategic and OHSP, have the continuing right, exercisable at any
time during the month of July of each calendar year commencing with 2001,
to cause the sale by UTLP of the UTLP OHSP Units, and, in the event of the
exercise of such right, (x) UTLP shall have the obligation, and hereby
agrees, to sell, and (y) FW Strategic and OHSP, jointly and severally,
shall have the

<PAGE>

obligation, and hereby agree, to purchase (either
directly or through their respective assigns or designees), the UTLP OHSP
Units free and clear of all liens, restrictions, and encumbrances, for a
net cash amount (which cash amount shall not be reduced or increased in any
way in respect of any costs or fees imposed by any Party) equal to the
greater of the Fair Market Value of such UTLP OHSP Units or $505,050.

(e) Payment Directions. Notwithstanding anything to the
contrary in this Agreement or otherwise, any payments to be made by FW
Strategic or OHSP pursuant to Section 4.02(c) or 4.02(d)(ii) of this
Agreement shall be made directly by wire transfer to the partners of UTLP
in the ratio of 99.001% of the funds to be paid pursuant to such sections
to JMB/NYC pursuant to the written wire instructions of JMB/NYC and .999%
of the funds to be paid pursuant to such sections to UTLP GP Corp. pursuant
to the written wire instructions of UTLP GP Corp., without reduction for
any fees, expenses or costs.

(f) 1290 L.P. will treat and report UTLP's Code Section
704(c) book/tax difference with respect to UTLP's interest in 1290 L.P. as
equal to approximately $129,700,000 as of the Effective Time.

(g) From and after the Closing Date to the date UTLP is no
longer a partner in 1290 L.P., (i) 1290 L.P. agrees that the effect of
using the "remedial method" described in U.S. Treasury regulation section
1.704-3(d) shall be that UTLP shall receive an annual remedial income
allocation from 1290 L.P. in an amount equal to approximately $3,300,000;
(ii) 1290 L.P. shall qualify and report all of the liabilities allocated to
UTLP as qualified non-recourse financing (within the meaning of section
465(b)(6)(B) of the Code); and (iii) in preparing any income tax return,
1290 L.P. shall not make any statement or file any attachment that
indicates that there is more than one activity for purposes of Section 465
of the Code.

4.03 OHSP Adverse Transactions. OHSP hereby covenants that no
OHSP Adverse Transaction shall occur from the Closing Date hereof to the
earlier of (x) the exercise by FW Strategic of the right set forth in
Section 4.02(c) hereof, and the receipt by JMB/NYC, in accordance with
Section 4.02(e), of all amounts to be received pursuant to Section 4.02(c),
and (y) the exercise by JMB/NYC of the right set forth in the proviso of
Section 4.02(d)(ii) hereof, and the receipt by JMB/NYC, in accordance with
Section 4.02(e), of all amounts to be received under Section 4.02(d)(ii),
it being hereby expressly agreed that in no event shall the consummation of
any of the Closing Transactions be deemed to be an "OHSP Adverse
Transaction".

4.04. Further Assurances. After the date hereof and at any
time thereafter, each Party shall, subject to the fulfillment of each of
the covenants and conditions of performance set forth herein or the waiver
thereof, use its reasonable best efforts (a) to perform such further acts
and execute such documents as may be required to (i) effect the
transactions expressly provided in the Transaction Agreements, (ii) obtain
in a timely manner all necessary waivers, consents and approvals, and
effect all necessary filings, in each case as required in order to effect
the transactions expressly provided in the Transaction Agreements, and, (b)
to take, or cause to be taken, all other actions and to do, or cause to be
done, all other things reasonably necessary, proper or advisable to
consummate and make effective as promptly as practicable the provisions of
the Transaction Agreements and the transactions expressly provided therein.

4.05. Negative Covenant. After the date hereof and at any time
thereafter, no Party shall take or refuse to take any action (including,
without limitation, refusing to approve or otherwise consent to any act for
which the approval or consent of such Party is required) so as to hinder,
delay or otherwise impair the ability of any Party to consummate the
transactions expressly provided for in the Transaction Agreements.

<PAGE>

4.06. Confidentiality. (a) Each Party hereby agrees that it
will not, without the prior written consent of the other Parties, disclose
to any person (i) the identities of the other Parties or any of their
investors or affiliates, (ii) the fact that this Agreement or the other
Parties exist, (iii) the status of the discussions or negotiations relating
to the transactions expressly provided for in the Transaction Agreements,
(iv) copies of, or the terms and provisions contained in, this Agreement,
the Contribution Agreement, the Amendment and Release Agreement, or any
other documents or agreements necessary to the consummation of the
transactions expressly provided for in the Transaction Agreements, or (v)
any other material confidential information with respect to the Parties or
their respective operations or other assets thereof (collectively,
"Confidential Information"); provided, however, that any Party may disclose
Confidential Information (A) to its partners or members (as applicable),
officers, directors, employees, affiliates, investors, agents, advisors and
lenders (including, without limitation, any accountants, attorneys or
financial advisors) (the "Representatives") who need to know such
information for the purpose of evaluating the transactions contemplated by
the Transaction Agreements (it being understood and agreed that such Party
shall advise such persons of their obligations concerning the
confidentiality of such Confidential Information and shall instruct such
persons to maintain the confidentiality of such Confidential Information in
accordance with the terms of this Agreement), (B) pursuant to a subpoena or
other legal process received in connection with a judicial, administrative
or regulatory proceeding in which such Party or its Representatives are
involved, subject to the provisions of Section 8.02, and (C) to the extent
that it is required to be disclosed by law or the rules or regulations of
any relevant regulatory organization, or that it is otherwise deemed
advisable in the opinion of counsel to such Party; provided, further that,
in the case of the foregoing clause (B), the applicable Party shall provide
the other Parties promptly with prior written notice of the applicable
matter and cooperate with the other Parties (at such other Parties' sole
cost and expense) to the extent such Parties seek any protective order to
prevent the disclosure of all or any portion of any Confidential
Information.

(b) No Party shall issue any press release or make any other
public announcement (it being agreed that the provisions of this paragraph
(b) shall apply to voluntary press releases or public announcement in
contrast to the required press releases or public announcements which are
governed by the provisions of paragraph (a) above) with respect to the
Transaction Agreements without the prior written consent of the other
Parties; provided, however, that any Party may issue a press release or
make a public announcement if, in the reasonable opinion of counsel to such
Party, (x) the information contained therein is required to be disclosed by
law or the rules or regulations of any relevant regulatory organization and
(y) such press release or public announcement does not involve the
disclosure of any Confidential Information.

4.07 OHSP shall furnish to UTLP, within sixty (60) days after
the close of its fiscal year, a statement required pursuant to Section 7.3
of the OHSP Partnership Agreement.

4.08 Each Party to this Agreement hereby covenants that it
shall notify in writing each other Party to this Agreement, prior to the
occurrence of and at the Closing hereunder, upon its having knowledge of
any facts or circumstances that would make any of the representations,
warranties, covenants or agreements contained in this Agreement untrue or
incorrect as of such date and as of the Closing Date.

4.09 237 Park L.P., 237 GP Corp., Metropolis, OHSP and UTLP
agree that if there is an actual or deemed liquidation of 237 Park L.P.
(or, following conversion, 237 Park LLC), UTLP will be allocated for
federal income tax purposes the same amount of any indebtedness secured by
the 237 Property or by an interest in 237 Park L.P. (or, following
conversion, 237 Park LLC) or in a partnership or limited liability company
which is directly or indirectly wholly-owned by 237 Park L.P. (or,
following conversion, 237 Park LLC) as was allocated to UTLP immediately
prior to the actual or deemed liquidation.

<PAGE>

SECTION 5

REPRESENTATIONS AND WARRANTIES

5.01. OHSP hereby represents and warrants as of the date hereof
and as of the Closing, as follows:

(a) It is duly organized, validly existing and in good
standing as a limited partnership under the laws of the State of Delaware,
with full power and authority to perform its obligations under this
Agreement.

(b) It has all partnership power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

(c) This Agreement has been duly authorized and duly executed
and delivered by it and, assuming the due authorization, execution and
delivery by the other Parties, constitutes the valid and binding instrument
or agreement of it, enforceable in accordance with its terms subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.

(d) Neither the execution, delivery and performance of this
Agreement by OHSP nor the consummation of any other of the transactions
herein contemplated by OHSP nor the fulfillment of the terms hereof or
thereof by OHSP will conflict with, result in a breach or violation of, or
constitute a default (or any event which with the giving of notice or the
lapse of time or both would constitute a default) under the organizational
documents of OHSP or the terms of any indenture, loan agreement, bond,
note, evidence of indebtedness, mortgage, deed of trust, lease, license,
permit, franchise, certificate or other agreement or instrument to which
OHSP is a party or by which it is bound or to which any of its properties
are subject, or require any authorization or approval under or pursuant to
any of the foregoing, or violate in any material respect any statute,
treaty, rule, regulation, ordinance, judgment, order, writ, ruling,
injunction or decree applicable to OHSP of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over OHSP.

(e) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by OHSP of this
Agreement, except for any of the foregoing which have been obtained.

(f) OHSP will not, (i) immediately after UTLP contributes its
membership interests in 237 Park LLC to OHSP in return for the UTLP OHSP
Units, be a partnership described in section 721(b) of the Code (i.e., a
partnership that would be an "investment company" within the meaning of
section 351(e) of the Code if it were incorporated) or (ii) at the time
that UTLP contributes its membership interests in 237 Park LLC to OHSP in
return for the UTLP OHSP Units, (A) have any plan or intention to become a
partnership described in section 721(b) of the Code or (B) have any
obligation to acquire additional assets or dispose of assets that would
cause it to become a partnership described in section 721(b) of the Code.

(g) OHSP will be classified as a partnership (and not as a
publicly traded partnership) for federal income tax purposes.

<PAGE>

(h) The audited financial statements of OHSP as of and for
the year ended December 31, 1998, and the unaudited financial statements of
OHSP as of and for the periods ended June 30, 1999, and September 30, 1999,
respectively, provided by OHSP to JMB/NYC present fairly in all material
respects the financial condition and results of operations of OHSP as of
and for the periods ended on the dates thereof. Since September 30, 1999,
there has been no material adverse change in the financial condition,
assets, operations or prospects of OHSP other than in the ordinary course
of its business or fluctuations in the market value of its assets in the
ordinary course.

(i) OHSP is not subject to any litigation, claim, action or
proceeding that could, if adversely determined, have a material adverse
effect on the financial condition, assets, operations or prospects of OHSP
and nothing has come to the attention of OHSP to cause it to believe that
any entity in which it has invested is subject to any litigation, claim,
action or proceeding that could, if adversely determined, have a material
adverse effect on the financial condition, assets, operations or prospects
of OHSP.

5.02. UTLP GP Corp. hereby represents and warrants, with
respect to UTLP, as of the date hereof and as of the Closing, as follows:

(b) It owns a 5% limited partnership interest in LTLP, free
and clear of any liens, restrictions, and encumbrances (except for those
liens, restrictions or encumbrances provided in the LTLP LP Agreement
running in favor of the partners of LTLP or their affiliates).

(c) It has all partnership power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

(d) This Agreement has been duly authorized and duly executed
and delivered by it and, assuming the due authorization, execution and
delivery by the other Parties, constitutes the valid and binding instrument
or agreement of it, enforceable in accordance with its terms subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.

(e) Neither the execution, delivery and performance of this
Agreement by UTLP nor the consummation of any other of the transactions
herein contemplated by UTLP or the fulfillment of the terms hereof or
thereof by UTLP will conflict with, result in a breach or violation of, or
constitute a default (or any event which with the giving of notice or the
lapse of time or both would constitute a default) under the organizational
documents of UTLP or the terms of any indenture, loan agreement, bond,
note, evidence of indebtedness, mortgage, deed of trust, lease, license,
permit, franchise, certificate or other agreement or instrument to which
UTLP is a party or by which it is bound or to which any of its properties
are subject, or require any authorization or approval under or pursuant to
any of the foregoing, or violate in any material respect any statute,
treaty, rule, regulation, ordinance, judgment, order, writ, ruling,
injunction or decree applicable to UTLP of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over UTLP.

<PAGE>

(f) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by UTLP of this
Agreement, except for any of the foregoing which have been obtained.

(g) It has not been formed or recapitalized for the specific
purpose of acquiring the UTLP OHSP Units.

5.03. JMB/NYC, the JMB/NYC Partners and JMB/NYC Special hereby
represent and warrant (each only as to itself) as of the date hereof and as
of the Closing, as follows:

(a) With respect to JMB/NYC, it is duly organized, validly
existing and in good standing as a limited partnership under the laws of
the State of Illinois, with full power and authority to perform its
obligations under this Agreement. With respect to Property Partners,
Carlyle XIII and Carlyle XIV, each is duly organized, validly existing and
in good standing as a limited partnership under the laws of the State of
Illinois, with full power and authority to perform its obligations under
this Agreement. With respect to JMB/NYC Special, it is duly organized,
validly existing and in good standing as a corporation, under the laws of
the State of Delaware, with full power and authority to perform its
obligations under this Agreement.

(b) JMB/NYC owns a 98.901% limited partnership interest, and
JMB/NYC Special owns a 0.1% general partnership interest, in UTLP, in each
case, free and clear of any liens, restrictions, and encumbrances (except
for those liens, restrictions or encumbrances provided in the UTLP LP
Agreement running in favor of the partners of UTLP or their affiliates or
that certain Amended, Restated and Consolidated Security Agreement, dated
October 10, 1996 by and between JMB/NYC and Metropolis). Property
Partners, Carlyle XIII and Carlyle XIV collectively own 100% of the limited
partnership interests in JMB/NYC. JMB/NYC Special is the sole general
partner of JMB/NYC.

(c) JMB/NYC, JMB/NYC Special and each of the JMB/NYC Partners
have all requisite power and authority to enter into this Agreement, and
the person signing this Agreement on behalf of each such entity has been
duly authorized by it to do so.

(d) This Agreement has been duly authorized and duly executed
and delivered by JMB/NYC, JMB/NYC Special and each of the JMB/NYC Partners
and, assuming the due authorization, execution and delivery by the other
Parties, constitutes the valid and binding instrument or agreement of each
such entity, enforceable in accordance with its terms subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.

(e) Neither the execution, delivery and performance of this
Agreement by JMB/NYC, JMB/NYC Special or any of the JMB/NYC Partners nor
the consummation of any other of the transactions herein contemplated by
any such entity or the fulfillment of the terms hereof or thereof by any
such entity will conflict with, result in a breach or violation of, or
constitute a default (or any event which with the giving of notice or the
lapse of time or both would constitute a default) under the organizational
documents of any such entity or the terms of any indenture, loan agreement,
bond, note, evidence of indebtedness, mortgage, deed of trust, lease,
license, permit, franchise, certificate or other agreement or instrument to
which such entity is a party or by which it is bound or to which any of its
properties are subject, or require any authorization or approval under or
pursuant to any of the foregoing, or violate in any

<PAGE>

material respect any statute, treaty, rule, regulation, ordinance,
judgment, order, writ, ruling, injunction or decree applicable to such
entity of any court, regulatory body, administrative agency, governmental
body or arbitrator having jurisdiction over such entity.

(f) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by JMB/NYC, JMB/NYC
Special or any of the JMB/NYC Partners of this Agreement, except for any of
the foregoing which have been obtained.

5.04. Metropolis hereby represents and warrants as of the date
hereof and as of the Closing, as follows:

(a) It is duly organized, validly existing and in good
standing as a corporation under the laws of the State of Maryland, with
full power and authority to perform its obligations under this Agreement.

(b) It owns 100% of the capital stock of 237 GP Corp., free
and clear of any liens, restrictions, and encumbrances. It owns a 95%
general partnership interest in LTLP, free and clear of any liens,
restrictions, and encumbrances.

(c) It has all corporate power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

(d) This Agreement has been duly authorized and duly executed
and delivered by Metropolis and, assuming the due authorization, execution
and delivery by the other Parties constitutes the valid and binding
instrument or agreement of Metropolis, enforceable in accordance with its
terms subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.

(e) Neither the execution, delivery and performance of this
Agreement by Metropolis nor the consummation of any other of the
transactions herein contemplated by Metropolis or the fulfillment of the
terms hereof or thereof by Metropolis will conflict with, result in a
breach or violation of, or constitute a default (or any event which with
the giving of notice or the lapse of time or both would constitute a
default) under the organizational documents of Metropolis or the terms of
any indenture, loan agreement, bond, note, evidence of indebtedness,
mortgage, deed of trust, lease, license, permit, franchise, certificate or
other agreement or instrument to which Metropolis is a party or by which it
is bound or to which any of its properties are subject, or require any
authorization or approval under or pursuant to any of the foregoing, or
violate in any material respect any statute, treaty, rule, regulation,
ordinance, judgment, order, writ, ruling, injunction or decree applicable
to Metropolis of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over Metropolis.

(f) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by Metropolis of
this Agreement, except for any of the foregoing which have been obtained.

<PAGE>

(g) Attached hereto as Exhibit G is a schedule reflecting the
relevant dates and amounts of (i) all capital contributions and loans
(including the identity of the lender and a description of the terms
thereof) received by LTLP, 237 Park L.P. (and, following conversion, 237
Park LLC) and 1290 L.P. and (ii) all distributions made by LTLP, 237 Park
L.P. (and, following conversion, 237 Park LLC) and 1290 L.P. for the period
commencing October 10, 1996 through the date hereof and updated as of the
Closing after giving effect to the transactions expressly provided for in
the Transaction Agreements.

(h) Attached hereto as Exhibit H is a schedule reflecting all
cash and cash equivalents held by each of 237 Park L.P. (and, following
conversion, 237 Park LLC), 1290 Park L.P. and LTLP as of the date hereof
and updated as of the Closing after giving effect to the transactions
expressly provided for in the Transaction Agreements.

5.05. UTLP GP Corp. hereby represents and warrants as of the
date hereof and as of the Closing, as follows:

(a) It is duly organized, validly existing and in good
standing as a corporation under the laws of the State of Delaware, with
full power and authority to perform its obligations under this Agreement.

(b) 100% of the capital stock of UTLP GP Corp. is owned by
Metropolis. UTLP GP Corp. owns a 0.999% general partnership interest in
UTLP, free and clear of any liens, restrictions, and encumbrances.

(c) It has all corporate power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

(d) This Agreement has been duly authorized and duly executed
and delivered by UTLP GP Corp. and, assuming the due authorization,
execution and delivery by the other Parties, constitutes the valid and
binding instrument or agreement of UTLP GP Corp, enforceable in accordance
with its terms subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.

(e) Neither the execution, delivery and performance of this
Agreement by UTLP GP Corp. nor the consummation of any other of the
transactions herein contemplated by UTLP GP Corp. or the fulfillment of the
terms hereof or thereof by UTLP GP Corp. will conflict with, result in a
breach or violation of, or constitute a default (or any event which with
the giving of notice or the lapse of time or both would constitute a
default) under the organizational documents of UTLP GP Corp. or the terms
of any indenture, loan agreement, bond, note, evidence of indebtedness,
mortgage, deed of trust, lease, license, permit, franchise, certificate or
other agreement or instrument to which UTLP GP Corp. is a party or by which
it is bound or to which any of its properties are subject, or require any
authorization or approval under or pursuant to any of the foregoing, or
violate in any material respect any statute, treaty, rule, regulation,
ordinance, judgment, order, writ, ruling, injunction or decree applicable
to UTLP GP Corp. of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over UTLP GP Corp.

(f) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by UTLP GP Corp. of
this Agreement, except for any of the foregoing which have been obtained.

<PAGE>

5.06. 237 Park L.P. hereby represents and warrants as of the
date hereof and as of the Closing, as follows:

(a) 237 Park L.P. is duly organized, validly existing and in
good standing as a limited partnership under the laws of the State of
Delaware, with full power and authority to perform its obligations under
this Agreement; provided, however, that, upon conversion of 237 Park L.P.
to 237 Park LLC, 237 Park LLC shall be and shall continue to be through the
time of Closing, duly organized, validly existing and in good standing as a
limited liability company under the laws of the State of Delaware.

(b) 237 Park L.P. has all partnership power and authority to
enter into this Agreement, and the person signing this Agreement on behalf
of it has been duly authorized by it to do so.

(c) This Agreement has been duly authorized and duly executed
and delivered by 237 Park L.P. and, assuming the due authorization,
execution and delivery by the other Parties, constitutes the valid and
binding instrument or agreement of 237 Park L.P. and, following conversion,
237 Park LLC, enforceable in accordance with its terms subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.

(d) Neither the execution, delivery and performance of this
Agreement by 237 Park L.P. or 237 Park LLC nor the consummation of any
other of the transactions herein contemplated by 237 Park L.P. or 237 Park
LLC or the fulfillment of the terms hereof or thereof by 237 Park L.P. or
237 Park LLC will conflict with, result in a breach or violation of, or
constitute a default (or any event which with the giving of notice or the
lapse of time or both would constitute a default) under the organizational
documents of 237 Park L.P. or 237 Park LLC or the terms of any indenture,
loan agreement, bond, note, evidence of indebtedness, mortgage, deed of
trust, lease, license, permit, franchise, certificate or other agreement or
instrument to which 237 Park L.P. or 237 Park LLC is a party or by which it
is bound or to which any of its properties are subject, or require any
authorization or approval under or pursuant to any of the foregoing, or
violate in any material respect any statute, treaty, rule, regulation,
ordinance, judgment, order, writ, ruling, injunction or decree applicable
to 237 Park L.P. or 237 Park LLC of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over 237 Park L.P. or 237 Park LLC.

(e) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance, as applicable, by
237 Park L.P. or 237 Park LLC of this Agreement, except for any of the
foregoing which have been obtained.

5.07. FW Strategic hereby represents and warrants as of the
date hereof and as of the Closing, as follows:

(a) It is duly organized, validly existing and in good
standing as a limited partnership under the laws of the State of Texas,
with full power and authority to perform its obligations under this
Agreement.

(b) It has all partnership power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

<PAGE>

(d) This Agreement has been duly authorized and duly executed
and delivered by it and, assuming the due authorization, execution and
delivery by the other Parties constitutes the valid and binding instrument
or agreement of it, enforceable in accordance with its terms subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.

(e) Neither the execution, delivery and performance of this
Agreement by FW Strategic nor the consummation of any other of the
transactions herein contemplated by FW Strategic or the fulfillment of the
terms hereof or thereof by FW Strategic will conflict with, result in a
breach or violation of, or constitute a default (or any event which with
the giving of notice or the lapse of time or both would constitute a
default) under the organizational documents of FW Strategic or the terms of
any indenture, loan agreement, bond, note, evidence of indebtedness,
mortgage, deed of trust, lease, license, permit, franchise, certificate or
other agreement or instrument to which FW Strategic is a party or by which
it is bound or to which any of its properties are subject, or require any
authorization or approval under or pursuant to any of the foregoing, or
violate in any material respect any statute, treaty, rule, regulation,
ordinance, judgment, order, writ, ruling, injunction or decree applicable
to FW Strategic of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over FW Strategic.

(f) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by FW Strategic of
this Agreement, except for any of the foregoing which have been obtained.

5.08. 237 GP Corp. hereby represents and warrants as of the
date hereof and as of the Closing, as follows:

(b) 100% of the capital stock of 237 GP Corp. is owned by
Metropolis. 237 GP Corp. owns a 1% general partnership interest (the sole
general partnership interest) in 237 Park L.P. (or, following the
conversion, a 1% membership interest in 237 Park LLC) free and clear of any
liens, restrictions, and encumbrances.

(c) It has all corporate power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

(d) This Agreement has been duly authorized and duly executed
and delivered by 237 GP Corp. and, assuming the due authorization,
execution and delivery by the other Parties, constitutes the valid and
binding instrument or agreement of 237 GP Corp, enforceable in accordance
with its terms subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.

<PAGE>

(e) Neither the execution, delivery and performance of this
Agreement by 237 GP Corp. nor the consummation of any other of the
transactions herein contemplated by 237 GP Corp. or the fulfillment of the
terms hereof or thereof by 237 GP Corp. will conflict with, result in a
breach or violation of, or constitute a default (or any event which with
the giving of notice or the lapse of time or both would constitute a
default) under the organizational documents of 237 GP Corp. or the terms of
any indenture, loan agreement, bond, note, evidence of indebtedness,
mortgage, deed of trust, lease, license, permit, franchise, certificate or
other agreement or instrument to which 237 GP Corp. is a party or by which
it is bound or to which any of its properties are subject, or require any
authorization or approval under or pursuant to any of the foregoing, or
violate in any material respect any statute, treaty, rule, regulation,
ordinance, judgment, order, writ, ruling, injunction or decree applicable
to 237 GP Corp. of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over 237 GP Corp.

(f) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by 237 GP Corp. of
this Agreement, except for any of the foregoing which have been obtained.

5.09. 1290 L.P. hereby represents and warrants as of the date
hereof and as of the Closing, as follows:

(b) It has all partnership power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

(d) Neither the execution, delivery and performance of this
Agreement by 1290 L.P. nor the consummation of any other of the
transactions herein contemplated by 1290 L.P. or the fulfillment of the
terms hereof or thereof by 1290 L.P. will conflict with, result in a breach
or violation of, or constitute a default (or any event which with the
giving of notice or the lapse of time or both would constitute a default)
under the organizational documents of 1290 L.P. or the terms of any
indenture, loan agreement, bond, note, evidence of indebtedness, mortgage,
deed of trust, lease, license, permit, franchise, certificate or other
agreement or instrument to which 1290 L.P. is a party or by which it is
bound or to which any of its properties are subject, or require any
authorization or approval under or pursuant to any of the foregoing, or
violate in any material respect any statute, treaty, rule, regulation,
ordinance, judgment, order, writ, ruling, injunction or decree applicable
to 1290 L.P. of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over 1290 L.P.

<PAGE>

(e) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by 1290 L.P. of this
Agreement, except for any of the foregoing which have been obtained.

5.10. 1290 GP Corp. hereby represents and warrants as of the
date hereof and as of the Closing, as follows:

(b) 100% of the capital stock of 1290 GP Corp. is owned by
Metropolis. 1290 GP Corp. owns a 1.0% general partnership interest in 1290
L.P., free and clear of any liens, restrictions, and encumbrances.

(c) It has all corporate power and authority to enter into
this Agreement, and the person signing this Agreement on behalf of it has
been duly authorized by it to do so.

(d) This Agreement has been duly authorized and duly executed
and delivered by 1290 GP Corp. and, assuming the due authorization,
execution and delivery by the other Parties, constitutes the valid and
binding instrument or agreement of 1290 GP Corp, enforceable in accordance
with its terms subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.

(e) Neither the execution, delivery and performance of this
Agreement by 1290 GP Corp. nor the consummation of any other of the
transactions herein contemplated by 1290 GP Corp. or the fulfillment of the
terms hereof or thereof by 1290 GP Corp. will conflict with, result in a
breach or violation of, or constitute a default (or any event which with
the giving of notice or the lapse of time or both would constitute a
default) under the organizational documents of 1290 GP Corp. or the terms
of any indenture, loan agreement, bond, note, evidence of indebtedness,
mortgage, deed of trust, lease, license, permit, franchise, certificate or
other agreement or instrument to which 1290 GP Corp. is a party or by which
it is bound or to which any of its properties are subject, or require any
authorization or approval under or pursuant to any of the foregoing, or
violate in any material respect any statute, treaty, rule, regulation,
ordinance, judgment, order, writ, ruling, injunction or decree applicable
to 1290 GP Corp. of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over 1290 GP Corp.

(f) No consent, approval, authorization or order of, or
qualification with, any court or governmental authority is required in
connection with the execution, delivery or performance by 1290 GP Corp. of
this Agreement, except for any of the foregoing which have been obtained.

<PAGE>

SECTION 6

TERMINATION AND AMENDMENT

6.01 Termination. This Agreement may be terminated at
any time before the Closing Date (except as otherwise provided herein) as
follows:

(a) by mutual written consent of all of the Parties;

(b) by any of the Parties, if the Closing shall not have
occurred on or before December 31, 1999 (the "Termination Date"); provided,
however, that the right to terminate this Agreement under this Section 6.0l
shall not be available to any Party whose failure to fulfill any obligation
under this Agreement has been the cause of, or resulted in, the failure of
the Closing to occur on or before the Termination Date; and

(c) by OHSP or Metropolis, upon written notice from either
such Party delivered to each of the other Parties hereto that the Interest
Purchase Agreement has been terminated.

6.02 Effect of Termination. In the event of the termination
of this Agreement pursuant to this Section 6, this Agreement shall become
void and of no effect with no liability to any Party; provided, however,
that (i) no such termination shall relieve any Party from any liability for
the damages (excluding consequential damages) resulting from any willful
and intentional breach of this Agreement, and (ii) this Section 6, as well
as Sections 4.06, 7.02, 8.02, 8.08 and 8.15 shall survive such termination.

SECTION 7

INDEMNIFICATION

7.01 [Intentionally Omitted]

7.02 Post-Closing Indemnification.

(a) Indemnification. From and after the Closing Date:

(i) JMB/NYC shall indemnify and hold OHSP harmless from and
against any and all Losses which OHSP (or, in the case of a breach relating
to Section 4.02(c) hereof, FW Strategic) may incur as a result of the JMB
Controlled Entities' taking or refusing to take any action which would
either (i) cause or result in the material inaccuracy or breach of any
representation or warranty of JMB/NYC contained in this Agreement, or (ii)
cause the material breach of any covenant or agreement of JMB/NYC contained
in this Agreement (including, without limitation, by prohibiting or
otherwise interfering with the exercise of the right of FW Strategic which
is set forth in Section 4.02(c) hereof) (each, a "JMB/NYC Indemnifiable
Action"); provided that any such JMB/NYC Indemnifiable Action is not
revoked or rescinded within thirty (30) days of JMB/NYC's receipt of notice
from OHSP that such an action has occurred.

<PAGE>

(ii) OHSP shall indemnify and hold JMB/NYC harmless from and
against any and all Losses which JMB/NYC may incur as a result of OHSP's
(or, in the case of a breach relating to the proviso in Section 4.02(d)(ii)
hereof, FW Strategic's) taking or refusing to take any action which would
either (i) cause or result in the material inaccuracy or breach of any
representation or warranty of OHSP contained in this Agreement, or (ii)
cause the material breach of any covenant or agreement of OHSP or, in the
case of the agreement set forth in the proviso of Section 4.02(d)(ii)
hereof, of FW Strategic, contained in this Agreement (including, without
limitation, by prohibiting or otherwise interfering with the exercise of
the right of JMB/NYC which is set forth in Section 4.02(d)(ii) hereof)
(each such action, a "OHSP Indemnifiable Action", and, together with each
JMB/NYC Indemnifiable Action, an "Indemnifiable Action"); provided that any
such OHSP Indemnifiable Action is not revoked or rescinded within thirty
(30) days of OHSP's receipt of notice from JMB/NYC that such an action has
occurred.

(b) Method of Asserting Claims, etc. The Parties hereby
acknowledge and agree that, in the event that any of the applicable parties
set forth in Section 7.02(a) take any applicable Indemnifiable Action (and
provided that the applicable Indemnifiable Action is not revoked or
rescinded within the time periods set forth in Section 7.02(a)(i) and
(ii)), the applicable indemnifying party shall absolutely and
unconditionally be liable to pay, and shall pay, the applicable indemnified
party for any and all Losses suffered as a result thereof. Notwithstanding
anything to the contrary in this Section 7.02, the foregoing sentence shall
not limit the remedies which either JMB/NYC or OHSP may have against any
other Party and the right of JMB/NYC or OHSP to seek injunctive relief with
respect to the applicable Indemnifiable Actions or specific performance of
the obligation underlying the same.

SECTION 8

MISCELLANEOUS PROVISIONS

8.01. Successors. Except as otherwise provided herein,
this Agreement and all of the terms and provisions hereof shall be binding
upon and inure to the benefit of the Parties and their respective heirs,
executors, administrators, successors, trustees and legal representatives.

8.02. GOVERNING LAW. (a) THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, INCLUDING LAWS RELATING TO THE VALIDITY, INTERPRETATION AND EFFECT OF
THIS AGREEMENT, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

(b) EACH OF THE PARTIES HEREBY IRREVOCABLY AND
UNCONDITIONALLY CONSENTS TO SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK AND THE COURTS OF THE UNITED STATES OF
AMERICA LOCATED IN THE STATE OF NEW YORK FOR ANY LITIGATION ARISING OUT OF,
RELATING TO OR EXPRESSLY PROVIDED FOR IN THE TRANSACTION AGREEMENTS (AND
AGREES NOT TO COMMENCE ANY LITIGATION RELATING HERETO EXCEPT IN SUCH
COURTS), AND FURTHER AGREES THAT SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR
DOCUMENT BY U.S. REGISTERED MAIL TO ITS RESPECTIVE ADDRESS SET FORTH IN
SECTION 8.04 SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY LITIGATION
BROUGHT AGAINST IT IN ANY SUCH COURT. EACH OF THE PARTIES HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY OBJECTION TO THE LAYING OF VENUE

<PAGE>

IN ANY LITIGATION ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER
TRANSACTIONS EXPRESSLY PROVIDED FOR IN THE TRANSACTION AGREEMENTS IN THE
COURTS OF THE STATE OF NEW YORK OR THE COURTS OF THE UNITED STATES OF
AMERICA LOCATED IN THE STATE OF NEW YORK AND HEREBY FURTHER IRREVOCABLY AND
UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.

(c) EACH OF THE PARTIES HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN CONNECTION
WITH ANY LITIGATION ARISING OUT OF, RELATING TO OR EXPRESSLY PROVIDED FOR
IN THE TRANSACTION AGREEMENTS.

8.03. Modification, Waiver in Writing. Neither this
Agreement nor any of the terms hereof may be amended, changed, waived,
discharged or terminated, unless such amendment, change, waiver, discharge
or termination is in writing signed by each Party.

8.04. Notices.

(a) All notices, requests, directions and other
communications permitted or provided for hereunder shall be in writing
(including, unless the context expressly otherwise provides, facsimile
transmission) and mailed, faxed or delivered, (i) if to Metropolis, to the
following address: c/o Victor Capital Group, 605 Third Avenue, New York, NY
10016, Attention: John R. Klopp, (ii) if to JMB/NYC, JMB/NYC Partners or
JMB/NYC Special, to the following address: 900 North Michigan Avenue, 19th
Floor, Chicago, Illinois 60611, Attention: Stuart C. Nathan and Gary
Nickele, (iii) if to UTLP or UTLP GP Corp., to the following address: c/o
Victor Capital Group, 605 Third Avenue, New York, NY 10016, Attention: John
R. Klopp, (iv) if to 237 Park L.P. or 237 GP Corp., to the following
address: c/o Victor Capital Group, 605 Third Avenue, New York, NY 10016,
Attention: John R. Klopp, (v) if to 1290 Park L.P. or 1290 GP Corp., to the
following address: c/o Victor Capital Group, 605 Third Avenue, New York, NY
10016, Attention: John R. Klopp, (vi) if to OHSP or FW Strategic, to Oak
Hill Strategic Asset Management, L.P., 201 Main Street, Suite 3100, Fort
Worth, Texas 76102, Attention: John Fant, or in each case, to such other
address as shall be designated by such Party in a written notice to the
other Parties hereunder from time to time.

(b) All such notices and communications transmitted by
overnight delivery shall be effective when delivered or upon refusal to
accept delivery (in the case of overnight delivery) or if mailed or
delivered, upon receipt or upon refusal to accept delivery. All notices
hereunder sent by facsimile transmission shall be deemed sufficiently
served or given for all purposes hereunder upon transmission as confirmed
by the sender's verified facsimile transmission or certified facsimile
activity report, provided that such transmission is promptly followed by
another form of notice allowed by this Section 8.04.

8.05. Headings. The Section and Sub-Section headings in
this Agreement are included herein for convenience of reference only and
shall not constitute a part of this Agreement for any other purpose.

8.06. Severability. Wherever possible, each provision of
this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.

8.07 Assignment.

(a) This Agreement shall not be assigned or otherwise
transferred by any party hereto whether by operation of law or otherwise
without the express written consent of each of the other Parties.

<PAGE>

(b) The Parties hereby agree that any purported assignment in
contravention of the preceding paragraph (a) shall be null and void.

(c) Subject to the preceding paragraph (a), this Agreement
will be binding upon, inure to the benefit of, and be enforceable by, the
Parties and their respective permitted successors and assigns.

8.08. Specific Performance. The Parties acknowledge and agree
that a breach of the provisions hereof could not be adequately compensated
for by money damages and that the subject matter of the transactions
contemplated hereby is unique. The Parties therefore agree that any Party
will be entitled, in addition to any other right or remedy available to him
or it, to an injunction restraining such breach or a threatened breach and
to specific performance of any such provision of this Agreement.

8.09. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall
be an original, but all of which shall together constitute one and the same
instrument.

8.10. No Third-Party Beneficiaries. This Agreement and
the Contribution Agreement are solely for the benefit of the Parties to
this Agreement or the parties to the Contribution Agreement and JMB/NYC,
and nothing contained in this Agreement or the Contribution Agreement shall
be deemed to confer upon any other person or entity any right to insist
upon or to enforce the performance or observance of any of the obligations
contained herein or therein.

8.11. Prior Agreements. The Transaction Agreements
contain the entire agreements of the Parties hereto and thereto in respect
of the transactions expressly set forth therein, and all prior agreements
among or between such Parties (other than those letters dated October 14,
1996, regarding the reimbursement of certain fees and expenses of JMB/NYC),
whether oral or written, are superseded by the terms of such Transaction
Agreements.

8.13. Good Faith. All Parties shall act in good faith in
the implementation of the foregoing provisions.

8.14 Survival. Except as otherwise provided herein, all
representations, warranties, covenants and agreements contained in this
Agreement shall survive the Closing until the later of (x) the earlier of
(a) the exercise by FW Strategic of the right set forth in Section 4.02(c)
hereof, and the receipt by JMB/NYC, in accordance with to Section 4.02(e),
of all amounts to be received under Section 4.02(c), and (b) the exercise
by JMB/NYC of the right set forth in the proviso of Section 4.02(d)(ii)
hereof and the receipt by JMB/NYC, in accordance with Section 4.02(e), of
all amounts to be received under Section 4.02(d)(ii), and (y) the date
JMB/NYC no longer holds a direct or indirect interest in 1290 LP.

8.15 Limit of Liability. Any liability of JMB/NYC or any
JMB/NYC Partner under this Agreement shall be limited to its respective
assets. In no event shall a deficit capital account of any partner of any
such partnership or any obligations of any partner to restore any deficit
capital account be deemed an asset of any such partnership.

[SIGNATURE PAGE FOLLOWS]

<PAGE>

IN WITNESS WHEREOF, the undersigned have executed this
Restructuring Agreement as of the date and year first above written.

OAK HILL STRATEGIC PARTNERS, L.P.

By: F.W. Strategic Asset Management, L.P.,
General Partner

By: STRATEGIC GENPAR, INC., General Partner

By:
Name:
Title:

237/1290 UPPER TIER ASSOCIATES, L.P.

By: 237/1290 Upper Tier GP Corp.,
General Partner

By:
Name:
Title:

237/1290 UPPER TIER GP CORP.

By:
Name:
Title:

237 PARK PARTNERS, L.P.

By: 237 GP Corp., General Partner

By:
Name:
Title:

237 GP CORP.

By:
Name:
Title:

1290 PARTNERS, L.P.
By: 1290 GP Corp., General Partner

By:
Name:
Title:

1290 GP CORP.

By:
Name:
Title:

JMB/NYC OFFICE BUILDING ASSOCIATES, L.P.

By: Carlyle Managers, Inc., General Partner

By:
Name:
Title:

<PAGE>

PROPERTY PARTNERS, L.P.

By: Carlyle Investors, Inc., General Partner

By:
Name:
Title:

CARLYLE-XIII ASSOCIATES, L.P.
By: Carlyle Investors, Inc., General Partner

By:
Name:
Title:

CARLYLE-XIV ASSOCIATES, L.P.
By: Carlyle Investors, Inc.,
its general partner

By:
Name:
Title:

CARLYLE MANAGERS, INC.

By:
Name:
Title:

METROPOLIS REALTY TRUST, INC.

By:
Name:
Title:

F.W. STRATEGIC ASSET MANAGEMENT, L.P.
(solely for the purpose of agreeing to certain
obligations set forth in Sections 4.02(c)
and (d) hereof)

By: Strategic Genpar, Inc., General Partner

By:
Name:
Title:

<PAGE>

Exhibit A

Amendments to UTLP LP Agreement

<PAGE>

Exhibit B

Amendments to the 1290 LP Agreement

<PAGE>

Exhibit C

Form of Liquidation Agreement

<PAGE>

Exhibit D

Form of Contribution Agreement

<PAGE>

Exhibit E

Form of Amendment and Release Agreement

<PAGE>

Exhibit F

Second Amended, Restated and Consolidated Note

<PAGE>

Exhibit G

Schedule of Capital Contributions and Distributions

<PAGE>

Exhibit H

Schedule of Cash and Cash Equivalents

EXHIBIT 10-X
- ------------

Oak Hill Strategic Partners, L.P.

(A Delaware Limited Partnership)

CONTRIBUTION AGREEMENT

SECTION 1
SUBSCRIPTION; CONTRIBUTED PROPERTY

1.1 Subscription. Subject to the terms and conditions of
this Contribution Agreement (the "Contribution Agreement"), the undersigned
(the "Contributor") hereby subscribes for and agrees to acquire a limited
partnership interest ("Interest") in Oak Hill Strategic Partners, L.P., a
Delaware limited partnership (the "Partnership"), pursuant to the terms of
that certain Amended and Restated Agreement of Limited Partnership of Oak
Hill Strategic Partners, L.P., dated as of August 26, 1996, as heretofore
amended (the "Partnership Agreement"). In exchange for and in
consideration of the Interest, the Contributor hereby agrees to (i)
contribute to the capital of the Partnership, the membership interest
which, at the time of the Closing, it shall own in 237 Park Partners,
L.L.C. (the "Contributed Property"), it being agreed that, for purposes of
Contributor's subscription, the foregoing shall be valued at $505,050, and
(ii) take any and all of the other actions set forth herein which are
required of it to be taken (including, without limitation, the actions set
forth in Section 1.2(b) hereof).

1.2 Closing. (a) Unless otherwise agreed to by the parties
hereto, the closing (the "Closing") of the transactions described herein
shall occur simultaneous to, and in the same place as, the closing under
the Restructuring Agreement (as defined below).

(b) At the Closing, the Contributor shall (i) deliver, convey
and contribute the Contributed Property for transfer to the Partnership or
its designee (by instrument or instruments as the Partnership shall
reasonably request); (ii) deliver the document described in Section 1.3(a)
below; and (iii) execute and become a party to the Partnership Agreement.

(c) At the Closing, the Partnership shall admit the
Contributor as a limited partner in accordance with the Partnership
Agreement and the terms specified in Section 1.3 hereof.

1.3 Election. (a) In connection with the consummation of the
transactions described herein, the Contributor shall, at the Closing,
deliver a document containing notice to the Partnership relating to which
"Class" of "Book Capital Account" (as such terms are defined in the
Partnership Agreement) it wishes to have the General Partner (as defined in
the Partnership Agreement) maintain in respect of its Interest.

(b) The General Partner hereby agrees that it shall notify
the Contributor in a timely fashion of (i) the establishment of the initial
balance in the Contributor's Book Capital Account and Tax Capital Account
(as defined in Article I of the Partnership Agreement), and (ii) the
respective percentages of the total Book Capital Account and Tax Capital
Account represented thereby.

(c) It is hereby acknowledged and agreed that no certificates
will be issued for the Interest acquired by the Contributor hereunder.

<PAGE>

SECTION 2

CONTRIBUTOR REPRESENTATIONS, WARRANTIES AND COVENANTS

2.1 Certain Contributor Representations, Warranties and
Covenants. In addition to the representations, warranties and covenants
contained in that certain Restructuring Agreement (the "Restructuring
Agreement") dated as of October 27, 1999, by and among the Partnership and
the Contributor, among other parties, the Contributor hereby acknowledges,
represents and warrants to, and agrees with, the Partnership, as of the
date hereof and as of the Closing, as follows:

(a) If the Contributor is a corporation, partnership, trust,
estate or other entity, (i) it is duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it is organized,
(ii) it is empowered, authorized and qualified to subscribe hereunder, to
commit capital to the Partnership hereunder and to become a limited partner
in, and, subject to the terms and conditions of the Partnership Agreement,
to make its Capital Contribution to the Partnership and (iii) the person
signing this Contribution Agreement and the Partnership Agreement on behalf
of such entity has been duly authorized by such entity to do so and has the
power to delegate authority pursuant to a power of attorney to be granted
under the Restructuring Agreement. If the Contributor is an individual,
the Contributor is of legal age to execute this Contribution Agreement and
the Partnership Agreement and is legally competent to do so.

(b) The Contributor has the full right, power and authority
to enter into this Contribution Agreement and the Partnership Agreement and
to carry out and perform its obligations hereunder and thereunder. Each of
this Contribution Agreement and the Partnership Agreement have been duly
authorized and have been duly executed and delivered by or on behalf of the
Contributor and, assuming the due authorization, execution and delivery of
each of them by the other parties hereto and thereto, such Agreements
constitute a valid and binding instrument or agreement of the Contributor.

(c) No consent, approval, authorization or order of, or
filing, registration or qualification with, any court or governmental
agency or body is required for the consummation by the Contributor of the
transactions on its part contemplated herein.

(d) The Contributor is acquiring the Interest for the
Contributor's own account as principal for investment and not with a view
to the distribution or sale thereof, subject to any requirement of law that
its property at all times be within its control.

(e) The Contributor has been given the opportunity to ask
questions of, and receive answers from, the General Partner and its
personnel relating to the Partnership, concerning the terms and conditions
of the transaction contemplated hereby and other matters pertaining to the
investment contemplated hereunder, and has had access to such financial and
other information concerning the Partnership as it has considered necessary
in order to make its decision to invest in the Partnership and has availed
itself of this opportunity to the full extent desired.

(f) No representations or warranties have been made to the
Contributor with respect to the investment contemplated hereby or the
Partnership other than the representations of the Partnership set forth
herein and in the Restructuring Agreement and the Contributor has not
relied upon any representation or warranty not provided herein or therein
in making this subscription.

<PAGE>

(g) If the Contributor is not a United States Person (as
defined below), the Contributor has heretofore notified the Partnership in
writing of such status. For this purpose, "United States Person" means a
citizen or resident of the United States, a corporation, partnership or
other entity created or organized in or under the laws of the United States
or any political subdivision thereof, or an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source.

(h) Except as expressly set forth in the Restructuring
Agreement, neither the execution, delivery and performance of this
Contribution Agreement or of the Partnership Agreement, nor the
contribution of the Contributed Property being made by the Contributor, nor
the consummation of any other of the transactions herein contemplated by
the Contributor or the fulfillment of the terms hereof or thereof by the
Contributor, will (i) result in the creation or imposition of any security
interests, rights of first refusal or to acquire, claims, liens, pledges,
equities or encumbrances (collectively, "Encumbrances") upon any of the
assets of the Contributor pursuant to the terms or provisions of, or
conflict with, result in a breach or violation of, or constitute a default
(or an event which, with the giving of notice or the lapse of time or both,
would constitute a default) under, the organizational documents, charter or
by-laws of the Contributor (if the Contributor is a corporation,
partnership, trust, estate or other entity), or the terms of any indenture,
loan agreement, bond, note, evidence of indebtedness, mortgage, deed of
trust, lease, license, permit, franchise, certificate or other agreement or
instrument to which the Contributor or any of its subsidiaries is a party
or by which they or it are bound or to which any of their or its properties
are subject, or (ii) require any authorization or approval under or
pursuant to any of the foregoing, or (iii) violate in any material respect
any statute, treaty, rule, regulation, ordinance, judgment, order, writ,
ruling, injunction or decree applicable to the Contributor or any of its
subsidiaries of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Contributor or
any of its subsidiaries.

(i) The Contributor is not an entity exempt from federal
income taxation or subject to taxation on "unrelated business taxable
income" under Sections 511 and 512 of the Internal Revenue Code of 1986, as
amended (the "Code").

(j) All information furnished to the Partnership by or on
behalf of the Contributor is and will be true and correct in all material
respects and, to the knowledge of the Contributor, such information does
not and will not contain an untrue statement of a material fact or omit any
material fact required to be stated therein or necessary in order to make
the statements therein not misleading.

2.2 Contributor Representations, Warranties and Covenants
with Respect to Contributed Property. In addition to the representations,
warranties and covenants contained in the Restructuring Agreement, the
Contributor hereby acknowledges, represents and warrants to, and agrees
with, the Partnership, as of the date hereof and as of the Closing, as
follows:

(a) Except as otherwise expressly provided in the Agreement
of Limited Partnership of 1290 Partners, L.P. or the Operating Agreement of
237 Park Partners, L.L.C., the Contributor is the lawful owner of the
Contributed Property free and clear of any Encumbrances and upon
contribution and delivery of such Contributed Property as provided herein,
the Contributor will have conveyed good and marketable title to such
Contributed Property, free and clear of any Encumbrances whatsoever.

<PAGE>

(b) No stamp or other issuance or transfer taxes or duties
are payable by or on behalf of the Partnership or the General Partner in
connection with the contribution of the Contributed Property by the
Contributor to the Partnership in the manner contemplated herein.

(c) None of the Contributed Property constitutes assets of an
employee benefit plan as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), whether or not such plan
is subject to ERISA, or a plan described in Section 4975(e)(1) of the Code.

(d) Except as otherwise expressly provided in the Agreement
of Limited Partnership of 1290 Partners, L.P. or the Operating Agreement of
237 Park Partners, L.L.C., the Contributed Property is not subject to any
restrictions upon its sale by the Partnership by reason of any agreement,
commitment or representation the Contributor has made in respect thereof,
or by reason of the Contributor's being in control of, controlled by or
under common control with the issuer(s) thereof within the meaning of the
Securities Act of 1933, as amended ("Securities Act"), or for any other
reason.

2.3 Investor's Awareness. In addition to the representations,
warranties and covenants contained in the Restructuring Agreement, the
Contributor hereby acknowledges that it understands the following:

(a) No federal or state agency has passed upon the Interest
or made any finding or determination as to the fairness of the investment
to be made by Contributor pursuant to the terms of this Contribution
Agreement. The Partnership Agreement has not and will not be filed with
the U.S. Securities and Exchange Commission (the "SEC") or with any
securities administrator under state securities laws.

(b) There are substantial risks incident to the acquisition
of the Interest.

(c) There are substantial restrictions on the transferability
of the Interest. Pursuant to the Partnership Agreement, the prior written
consent of the General Partner is required for all transfers of the
Interest. There will be no established market for the Interest and no
public market for the Interest will develop. The Interest will not be, and
investors in the Partnership will not have any rights to require that the
Interest be, registered under the Securities Act or the securities laws of
the various states and therefore the resale, pledge, assignment or other
disposition thereof will not be permitted unless such Interest is
subsequently registered or unless an exemption from such registration is
available (it being hereby agreed by the Contributor that the General
Partner may require (x) an opinion of Contributor's counsel with respect to
such exemption in form and substance satisfactory to the General Partner
and the General Partner's counsel, or (y) a favorable interpretive letter
from the SEC and a copy of the application on which it was based). As a
result of the foregoing, the Contributor may be required to hold the
Interest herein subscribed for and bear the economic risk of its investment
in the Partnership indefinitely and it may not be possible for the
Contributor to liquidate its investment in the Partnership.

(d) With respect to the tax and other legal consequences of
an investment in the Interest, the Contributor is relying solely upon the
advice of its own tax and legal advisors.

(e) As of the date hereof and at all times up to and
including the time immediately prior to its acquisition of the Interest,
the Contributor has and shall have such knowledge and experience in
financial and business matters such that the Contributor is and will be
capable of evaluating the merits and risks of the prospective investment.

<PAGE>

(f) The Contributor has no need for liquidity in its
investment hereunder and has the ability to bear the economic risk of such
investment and to retain the Interest for the full term of the Partnership.

(g) The Contributor has reviewed the Partnership Agreement,
and understands the risks of, and other considerations relating to, an
acquisition of the Interest as well as the Partnership's investments and
the Partnership's objectives, policies and strategies.

Section 2.4Certain Contributor Covenants. (a) The
Contributor hereby covenants to deliver to the Partnership such information
relevant to the Contributor's acquisition of the Interest as is reasonably
requested by the Partnership, including, without limitation, information as
to certain matters under the Securities Act and the Investment Company Act
as the Partnership may reasonably request in order to ensure the
Partnership's compliance with such acts and the availability of any
exemption thereunder.

(b) The Contributor hereby agrees that each of the
representations, warranties and covenants made by it in this Contribution
Agreement will be deemed to have been reaffirmed by the Contributor as of
the Closing.

(c) The Contributor hereby covenants that it shall notify the
Partnership immediately upon its having knowledge of any facts or
circumstances that would make any of its representations or warranties
contained in this Contribution Agreement untrue or incorrect as of the
Closing.

(d) The Contributor hereby covenants that it shall not, and
shall not cause or permit any other person to, act in a manner that would
violate any covenant of the Contributor which is contained in this
Contribution Agreement.

SECTION 3

PARTNERSHIP REPRESENTATIONS

3.1 Partnership Representations. The Partnership hereby
represents, warrants and acknowledges to the Contributor, as of the date
hereof and as of the Closing, as follows:

(a) The Partnership is duly organized, validly existing and
in good standing as a limited partnership under the laws of the State of
Delaware, with full power and authority to enter into this Contribution
Agreement and to perform its obligations under this Contribution Agreement
and the Partnership Agreement. The Interest offered hereby and specified
pursuant to Section 1.3 hereof is a duly and validly issued limited
partnership interest in the Partnership.

(b) The Partnership is empowered, authorized and qualified to
enter into this Contribution Agreement and the Partnership Agreement, and
the person signing this Contribution Agreement and the Partnership
Agreement on behalf of the Partnership has been duly authorized by the
Partnership to do so. There is no outstanding judgment, decree,
injunction, rule, order or award of any court, arbitrator or governmental
agency or bureau against the Partnership or the General Partner that would
prevent the consummation of the transactions expressly provided for in this
Contribution Agreement or that would have a material adverse affect on the
Partnership or the General Partner.

<PAGE>

(c) Each of this Contribution Agreement and the Partnership
Agreement have been duly authorized and have been or will be duly executed
and delivered by the Partnership and, assuming the due authorization,
execution and delivery of each of them by the other parties hereto and
thereto, such Agreements constitute or will constitute valid and binding
instruments or agreements of the Partnership. The General Partner has
delivered to the Contributor a true and complete copy of the Partnership
Agreement as in effect on the date hereof and, except for the transactions
contemplated by this Contribution Agreement, no amendment or modification
to such Partnership Agreement has been authorized or proposed by the
General Partner.

(d) Neither the execution, delivery and performance of this
Contribution Agreement or the Partnership Agreement by the Partnership, nor
the consummation of any other of the transactions herein contemplated by
the Partnership or the fulfillment of the terms hereof or thereof by the
Partnership, will (i) conflict with, result in a breach or violation of, or
constitute a default (or any event which, with the giving of notice or the
lapse of time or both, would constitute a default) under the organizational
documents of the Partnership or the terms of any indenture, loan agreement,
bond, note, evidence of indebtedness, mortgage, deed of trust, lease,
license, permit, franchise, certificate or other agreement or instrument to
which the Partnership is a party or by which it is bound or to which any of
its properties are subject, or (ii) require any authorization or approval
under or pursuant to any of the foregoing, or (iii) violate in any material
respect any statute, treaty, rule, regulation, ordinance, judgment, order,
writ, ruling, injunction or decree applicable to the Partnership of any
court, regulatory body, administrative agency, governmental body or
arbitrator having jurisdiction over the Partnership.

(e) The Partnership is in compliance with all of the terms of
the Partnership Agreement and is in compliance, in all material respect,
with all laws, rules and regulations applicable to the Partnership.

(f) No consent, approval, authorization of, or declaration or
filing with, any governmental agency or bureau on the part of the
Partnership, other than those that have been previously obtained, made or
given, is required for the valid execution and delivery of this
Contribution Agreement or the Restructuring Agreement and the transactions
expressly provided for herein and therein.

(g) Upon due authorization, execution and delivery of the
Partnership Agreement by the Contributor, the Contributor will be entitled
to all of the benefits of a Limited Partner under the Partnership Agreement
and, unless otherwise expressly provided in the Partnership Agreement, the
Delaware Revised Uniform Limited Partnership Act.

(h) Under existing federal income tax laws and regulations,
the Partnership will be classified as a partnership, and not as an
association taxable as a corporation for federal income tax purposes.

(i) As of the date hereof, the disclosure materials and the
financial statements of the Partnership contained therein do not contain an
untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading.

<PAGE>

(j) The audited balance sheet of the Partnership as of
December 31, 1998, the related audited statements of income and cash flows
for the year then ended, the unaudited balance sheet of the Partnership as
of September 30, 1999 and the related unaudited statements of income and
cash flows for the nine (9) months then ended (collectively, the
"Partnership Financial Statements") present fairly and accurately the
financial condition and results of operations of the Partnership at the
dates and for the periods indicated therein and were prepared in accordance
with generally accepted accounting principles ("GAAP"), consistently
applied, except that the unaudited Partnership Financial Statements are
subject to normal year-end audit adjustments and contain no footnotes. The
Partnership has no liabilities or obligations of any nature (whether
accrued, absolute, contingent or otherwise) required by GAAP to be set
forth on a consolidated balance sheet of the Partnership or in the notes
thereto and which, individually or in the aggregate, would have a material
adverse effect on the business, business prospects, financial condition or
results of operations of the Partnership. Since the date of the most
recent audited Partnership Financial Statements, the Partnership has
conducted its business only in the ordinary course (taking into account
prior practices, including the acquisition of securities and properties and
issuance of Partnership interests) and there has not been (i) any material
adverse change in the business, business prospects, financial condition or
results of operations of the Partnership, nor has there been any occurrence
or circumstance that, with the passage of time, would reasonably be
expected to result in such a material adverse change, (ii) any damage,
destruction or loss, whether or not covered by insurance, that has or would
have a material adverse effect on the business, business prospects,
financial condition or results of operation of the Partnership or (iii) any
change by the Partnership made prior to the date of this Contribution
Agreement in its accounting methods, principles or practices materially
affecting its assets, liabilities or business.

(k) No broker, investment banker, financial advisor or other
person is entitled to any broker's, finder's, financial advisor's or
similar fee or commission in connection with the transactions expressly
contemplated hereby based upon arrangements made by or on behalf of the
Partnership.

3.2 Certain Partnership Covenants. (a) The Partnership
hereby agrees that it shall use its best efforts to meet all future
requirements under applicable federal laws and regulations necessary to be
classified as a partnership, and not as an association taxable as a
corporation, for federal income tax purposes.

(b) The Partnership hereby agrees that each of the
representations, warranties and covenants made by it in this Contribution
Agreement will be deemed to have been reaffirmed by the Partnership as of
the Closing.

(c) The Partnership hereby agrees that it shall notify the
Contributor immediately upon its having knowledge of any facts or
circumstances that would make any of its representations or warranties
contained in this Contribution Agreement untrue or incorrect as of the
Closing.

<PAGE>

SECTION 4

CONDITIONS TO CLOSING

4.1 Contributor Conditions to Closing. The Contributor's
obligations as set forth hereunder are subject to the fulfillment (or
waiver by the Contributor), prior to or at the Closing, of the following
conditions:

(a) Performance. The Partnership shall have duly performed
and complied in all material respects with all agreements and conditions
contained in this Contribution Agreement and in the Restructuring Agreement
required to be performed or complied with by it prior to or at the Closing,
and all representations and warranties of the Partnership herein and in the
Restructuring Agreement shall be true and correct as of such date.

(b) Concurrent Closing. All of the closing conditions set
forth in the Restructuring Agreement and related documents shall have been
satisfied as of the Closing and a closing thereunder shall be occurring
concurrently with the Closing.

(c) No Material Adverse Change. There shall not have
occurred any material adverse change in the business, business prospects,
financial condition or results of operations of the Partnership since the
date hereof.

4.2 Partnership Conditions to Closing. The Partnership's
obligations as set forth hereunder are subject to the fulfillment (or
waiver by the Partnership), prior to or at the time of the Closing, of the
following conditions:

(a) Performance. The Contributor shall have duly performed
and complied in all material respects with all agreements and conditions
contained in this Contribution Agreement and in the Restructuring Agreement
required to be performed or complied with by it prior to or at the Closing,
and all representations and warranties of the Contributor herein and in the
Restructuring Agreement shall be true and correct as of such date; and

SECTION 5

MISCELLANEOUS

5.1 Modification. Neither this Contribution Agreement nor
any provisions hereof shall be modified, changed, discharged or terminated
except by an instrument in writing signed by the party against whom any
such waiver, change, discharge or termination is sought.

5.2 Revocability. Except as otherwise provided by the
Restructuring Agreement, this Contribution Agreement may not be withdrawn
or revoked by the Contributor in whole or in part without the consent of
the Partnership.

5.3 Notices. All notices, consents, requests, demands,
offers, reports and other communications required or permitted to be given
pursuant to this Contribution Agreement shall be in writing and shall be
considered properly given and received when personally delivered to the
party entitled thereto, or when sent by facsimile or by overnight courier,
or seven (7) business days after being sent by certified United States
mail, return receipt requested, in a sealed envelope, with postage prepaid,

<PAGE>

in each case, addressed, (i) if to the Partnership or the General Partner,
to F.W. Strategic Asset Management, L.P., 201 Main Street, Suite 2300, Fort
Worth, Texas 76102, and (ii) if to the Contributor, to the address set
forth below the Contributor's signature on the counterpart of this
Contribution Agreement which the Contributor originally executed and
delivered to the Partnership; provided, however, that any notice sent by
facsimile shall be promptly followed by a copy of such notice sent by mail
or overnight courier in the manner described herein. The Partnership, the
General Partner or the Contributor may change its address by giving notice
of such change to the other party hereunder. The Partnership and the
General Partner shall send a copy of all items given, sent or delivered to,
or received from, Contributor to JMB/NYC Office Building Associates, L.P.,
c/o JMB Realty Corporation, 900 North Michigan Avenue, 19th Floor, Chicago,
Illinois 60611, Attention: Stuart Nathan (Facsimile: (312) 915-1043).

5.4 Counterparts. This Contribution Agreement may be
executed in multiple counterpart copies, each of which shall be considered
an original and all of which shall constitute one and the same instrument
binding on all the parties, notwithstanding that all parties are not
signatories to the same counterpart.

5.5 Headings. The headings of the Sections of this
Contribution Agreement are inserted for convenience only and shall not be
deemed to constitute a part of this Contribution Agreement.

5.6 Successors. Except as otherwise provided herein, this
Contribution Agreement and all of the terms and provisions hereof shall be
binding upon and inure to the benefit of the parties and their respective
heirs, executors, administrators, successors, trustees and legal
representatives. If the Contributor is more than one person, the
obligation of the Contributor shall be joint and several and the
agreements, representations, warranties and acknowledgments herein
contained shall be deemed to have been made by and shall be binding upon
each such person and such person's heirs, executors, administrators,
successors, trustees and legal representatives.

5.7 Assignability. This Contribution Agreement shall not be
transferable or assignable by the Contributor in any manner whatsoever.
Any purported assignment of this Contribution Agreement shall be null and
void.

5.8 Confidentiality. (a) The Contributor shall, and shall
direct those of its affiliates, directors, officers, employees, attorneys,
accountants and advisors (the "Representatives") who have access to
Confidential Information (as defined below) to, keep confidential and not
disclose any Confidential Information without the express consent, (x) in
the case of Confidential Information acquired from the Partnership, of the
Partnership or, (y) in the case of Confidential Information acquired from
the General Partner or any other partner in the Partnership, the General
Partner or such other partner, unless (i) such disclosure shall be required
by applicable law, governmental rule or regulation, court order,
administrative or arbitral proceeding or by any bank regulatory authority
having jurisdiction over the Contributor or (ii) such disclosure is in
connection with any litigation against the Partnership, the Contributor,
any other partner in the partnership or the General Partner. Such
Confidential Information may be used by the Contributor only in connection
with Partnership matters.

<PAGE>

(b) As used herein, "Confidential Information" shall mean any
information that the Contributor may acquire from the Partnership or the
General Partner which (i) is not already available through publicly
available sources of information (other than as a result of disclosure by
the Contributor), (ii) was not in the possession of, or known by, the
Contributor prior to its disclosure to the Contributor by the Partnership,
or (iii) does not become available to the Contributor on a non-confidential
basis from a third party, (so long as that such third party is not bound by
this Contribution Agreement or another confidentiality agreement with the
Partnership). Such Confidential Information may include, without
limitation, information that pertains or relates to (A) the business and
affairs of the General Partner or any other partner, (B) any investments or
proposed investments of the Partnership or (C) any other Partnership
matters.

(c) In the event that the Contributor or any Representative
of the Contributor is required to disclose any Confidential Information
pursuant to a subpoena, request for discovery or other civil or legal
process, the Contributor will use reasonable efforts to provide the
Partnership with prompt written notice so that the Partnership may seek a
protective order or other appropriate remedy and/or waive compliance with
the provisions of this Contribution Agreement, and the Contributor will
cooperate with the Partnership, at the expense of the Partnership, in any
effort any such person undertakes to obtain a protective order or other
remedy. In the event that such protective order or other remedy is not
obtained, or that the Partnership waives compliance with the provisions of
this Section 5.8, the Contributor and its Representatives will furnish only
that portion of the Confidential Information which is required and will
exercise reasonable efforts, at the expense of the Partnership, to obtain
reliable assurance that the Confidential Information will be accorded
confidential treatment.

(d) In its sole discretion, the General Partner may agree to
waive any or all of the provisions of this Section 5.8 with respect to the
Contributor.

(e) The General Partner and the Partnership may disclose the
identity of the Contributor only (i) in accordance with the restrictions
set forth in this section 5.8 or (ii) on a confidential basis to any other
partner or acquiror of the Interest.

(e) The provisions of this Section 5.8 shall survive the
termination of this Contribution Agreement and the formation and
dissolution of the Partnership, whether or not the Contributor is admitted
to the Partnership.

5.9 GOVERNING LAW. THIS CONTRIBUTION AGREEMENT AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE INTERPRETED AND
ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW
YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED WHOLLY WITHIN THAT
JURISDICTION.

5.10 Jurisdiction; Venue.

(a) All disputes arising out of, connected with, related to
or incidental to the transactions contemplated by, or the relationship
established between, the parties hereto in connection with this
Contribution Agreement, whether arising in contract, tort, equity or
otherwise, shall be resolved by the state or federal courts located in the
County of New York in the State of New York, and the parties hereby consent
and submit to the personal and subject matter jurisdiction of any state or
federal court located in the County of New York in the State of New York;
provided, however, that such disputes need not be brought in such courts if
the defendant in such suit is not subject to personal jurisdiction in the
State of New York. Each party hereby agrees that legal process in any such
action or proceeding may be served in accordance with clause (c) hereof and
the notice procedure set forth in Section 5.3 hereof. Nothing in this
Section 5.10 shall affect the right of the Partnership to serve legal
process in any other manner permitted by law.

<PAGE>

(b) The parties irrevocably waive, to the fullest extent
permitted by law, any objection that they may now or hereafter have to the
laying of venue of any such action or proceeding in the courts of the State
of New York located in the County of New York, or the Federal courts
located in the County of New York in the State of New York.

(c) The Contributor hereby agrees and covenants that, if the
Contributor is a non-United States person, it shall appoint an authorized
agent that at all times shall have an office located in the State of New
York upon which process may be served in any action or proceeding against
the Contributor relating in any way to this Contribution Agreement and
shall deliver the acceptance of such appointment to the Partnership. The
Contributor further agrees that service of process upon such authorized
agent together with written notice of said service to the Contributor by
the person serving the same shall be deemed in every respect effective
service of process upon the Contributor in any such action or proceeding.
The Contributor may appoint a successor authorized agent and, upon delivery
to the Partnership of acceptance of such appointment by such a successor,
the appointment of the prior authorized agent shall terminate. The
Contributor further agrees and covenants that it shall take any and all
action, including the filing of any and all documents and instruments as
may be necessary to continue the designation and appointment of the
authorized agent described in this paragraph in full force and effect until
the later of the termination of this Contribution Agreement or such time as
the Contributor no longer holds the Interest.

5.11 Severability. To the extent that any provision of this
Contribution Agreement shall be held to be invalid, illegal or
unenforceable, such provision shall be deemed severable and the validity,
legality and enforceability of the remaining provisions of this
Contribution Agreement shall not in any way be affected or impaired.

5.12 Entire Agreement. This Contribution Agreement, the
Partnership Agreement and the Restructuring Agreement constitute the entire
agreement among the parties hereto and thereto with respect to the subject
matter hereof and thereof and supersede all other prior agreements and
undertakings, both written and oral, among the parties, or any of them,
with respect to the subject matter hereof and thereof.

5.13 Survival of Representations, Warranties and Covenants.
The representations, warranties and covenants in Sections 2.1, 2.2, 2.3,
2.4, 3.1 and 3.2 shall survive the formation and dissolution of the
Partnership and the Contributor's admission as a Partner.

5.14 Termination. This Contribution Agreement shall terminate
in the event that the Restructuring Agreement is terminated in accordance
with its terms prior to the Closing; provided that Section 5.8 shall
survive any such termination.

<PAGE>

IN WITNESS WHEREOF, the undersigned has executed this
Contribution Agreement as of the date first written above.

237/1290 Upper Tier Associates, L.P.

By: 237/1290 Upper Tier GP Corp.

By: _______________________________
Name:
Title:

Contributor's Name and Mailing Address
and Tax Identification Number:

_____________________________________________________
(Name)

_____________________________________________________
(Street)

_____________________________________________________
(City) (State) (Zip Code)

_____________________________________
(Telephone Number)

_____________________________________
(Facsimile Number)

_____________________________________________________
(Tax Identification or Social Security Number)

<PAGE>

Contributor's Address for Notices
if Different from Address Above:

_____________________________________________________
(Street)

_____________________________________________________
(City) (State) (Zip Code)

_____________________________________
(Telephone Number)

_____________________________________
(Facsimile Number)

Status of the Contributor (check one):

[ ] General Partnership [ ] Trust
[ X ] Limited Partnership [ ] "Grantor" Trust
[ ] Corporation [ ] Estate
[ ] S Corporation [ ] Limited Liability Company
[ ] Individual [ ] Other (identify)______________

IN WITNESS WHEREOF, the Partnership has executed this
Contribution Agreement as of the ______ day of _____________________, 1999.

OAK HILL STRATEGIC PARTNERS, L.P.

By: F.W. STRATEGIC ASSET MANAGEMENT, L.P.,
General Partner

By: STRATEGIC GENPAR, INC., General Partner

By:
------------------------------
Name:
Title:

EXHIBIT 10-Y
- ------------

AMENDMENT AND RELEASE AGREEMENT

THIS AMENDMENT AND RELEASE AGREEMENT (the "Agreement") is
entered into as of the ___ day of __________, 1999, by and among METROPOLIS
REALTY TRUST, INC., a Maryland Corporation ("Metropolis"); and PROPERTY
PARTNERS, L.P. ("Property Partners"), CARLYLE-XIII ASSOCIATES, L.P.
("Carlyle-XIII") and CARLYLE-XIV ASSOCIATES, L.P. ("Carlyle-XIV"), each a
Delaware limited partnership (collectively, the "Indemnitors" and, together
with Metropolis, the "Parties").

WHEREAS, Metropolis holds a 95% interest as the general partner
of 237/1290 Lower Tier Associates, L.P., a Delaware limited partnership
("LTLP"), which owns (x) a 99% interest as limited partner in 237 Park
Partners, L.P. ("237 Park L.P."), which owns a direct interest in that
certain property known as 237 Park Avenue, New York, New York (together
with all related personal property, intangibles, improvements and fixtures,
the "237 Property"), and (y) a 99% interest as a limited partner in 1290
Partners, L.P., a Delaware limited partnership ("1290 L.P."), which owns a
direct interest in that certain property known as 1290 Avenue of the
Americas, New York, New York (together with all related personal property,
intangibles, improvements and fixtures, "1290 Sixth").

WHEREAS, JMB/NYC Office Building Associates, L.P., an Illinois
limited partnership ("JMB/NYC"), holds a 98.901% interest as the limited
partner of 237/1290 Upper Tier Associates, L.P., a Delaware limited
partnership ("UTLP") which holds a 5% interest as the limited partner of
LTLP.

WHEREAS, simultaneous hereto, Oak Hill Strategic Partners,
L.P., a Delaware limited partnership ("OHSP"), JMB/NYC, Metropolis, the
Indemnitors, UTLP and certain other parties are entering into a
Restructuring Agreement (the "Restructuring Agreement") pursuant to which
(i) 237 Park L.P. shall be converted into 237 Park Partners, LLC ("237 Park
LLC"), a Delaware limited liability company, (ii) Metropolis and UTLP shall
cause LTLP to liquidate, and in connection therewith, shall receive an in-
kind distribution of their respective pro rata portions of LTLP's interests
in 237 Park LLC and 1290 L.P., and (iii) UTLP shall contribute its
membership interest in 237 Park LLC for [Class __] Partnership Units in
OHSP (the "UTLP OHSP Interests"), in each case, as more particularly
described therein.

WHEREAS, the Indemnitors, as all of the limited partners in
JMB/NYC will derive substantial benefit from the closing of the
transactions contemplated under the Restructuring Agreement.

WHEREAS, the Parties are or are the successors in interest to,
and are, as of the date hereof, all of, the parties to that certain
Indemnification Agreement dated as of October 10, 1996, a true and correct
copy of which is attached hereto as Exhibit A (the "Indemnification
Agreement").

WHEREAS, it is a condition to the closing of the transactions
under the Restructuring Agreement that this Agreement be executed by the
Parties hereto.

NOW, THEREFORE, in consideration of the mutual terms, covenants
and conditions herein contained, and for other good, valid and binding
consideration (including, without limitation, the terms, covenants and
conditions set forth in the Restructuring Agreement), the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:

<PAGE>

SECTION 1

AMENDMENT AND OTHER AGREEMENTS

1.01 Amendment. The Parties hereby amend the Indemnification
Agreement as follows:

(a) Paragraph 2 of the Indemnification Agreement is hereby
deleted in its entirety, and the following is hereby added in lieu thereof:

"2. The Indemnitors absolutely and unconditionally
agree to indemnify and to hold Indemnitee harmless from and against any and
all losses, claims, liabilities, damages, costs or expenses (including,
without limitation, reasonable counsel fees) of any nature whatsoever,
contingent or otherwise, foreseen or unforeseen, which Indemnitee may or
shall incur as a result of any of JMB L.P., its officers, directors,
partners (including, without limitation, any Indemnitor), stockholders,
agents or affiliates (collectively, the "Controlled Entities")
intentionally interfering with, impeding or preventing (including, without
limitation, through the filing by JMB L.P. of a voluntary petition under
the Bankruptcy Code or any other federal or state bankruptcy or insolvency
statute or the joining by any Controlled Entity in an involuntary petition
against JMB L.P. under the Bankruptcy Code or such other statute) any of
the following:

(x) the exercise by Indemnitee of the Purchase Right
(as defined in Section 12.2A of the Amended and Restated Partnership
Agreement (the "1290 L.P. Agreement") of 1290 Partners, L.P., a Delaware
limited partnership ("1290 L.P."), dated as of October 25, 1999 between
Indemnitee, the Upper Tier Partnership and 1290 G.P. Corp., a Delaware
corporation); or

(y) any (i) disposition, mortgage, pledge, encumbrance,
hypothecation or exchange of (A) that certain property known as 1290 Avenue
of the Americas, New York, New York ("1290 Sixth") by 1290 L.P., or (B) any
partnership interest which Upper Tier Partnership may own in 1290 L.P., or
(ii) merger or other combination of 1290 L.P. with or into another entity,
in accordance with the terms of the 1290 L.P. Agreement, provided that such
disposition, mortgage, pledge, encumbrance, hypothecation, exchange, merger
or other combination described in this clause (y) does not constitute an
"Adverse Transaction" as defined in the 1290 L.P. Agreement;

provided, that, any such action (individually, a "Prohibited
Action" and collectively, the "Prohibited Actions") is not revoked or
rescinded within the time period provided in paragraph 3 below."

(b) The Parties hereby delete paragraph 4 of the
Indemnification Agreement in its entirety and hereby substitute in its
place the following:

"4. The term "Maximum Indemnitors' Liability Amount" as
used in this Indemnification Agreement shall mean an amount equal to
$14,285,000; provided that such amount shall be reduced on a dollar for
dollar basis for each dollar actually received by Indemnitee in respect of
the JMB Collateral (as defined in the 1290 L.P. Agreement)."

(c) With respect to paragraph 5 of the Indemnification
Agreement, the Parties hereby delete the phrase "Upper Tier and Lower Tier
Partnership Agreements" and hereby substitute in its place the phrase
"Upper Tier Partnership Agreement and 1290 L.P. Agreement".

(d) With respect to clause (iii) of the first sentence of
paragraph 13 of the Indemnification Agreement, the Parties hereby delete
the phrase "or of the interest of the Upper Tier Partnership in the Lower
Tier Partnership pursuant to the Put Right under Section 12.2C of the
partnership agreement of the Lower Tier Partnership" in its entirety.

(e) With respect to paragraph 15 of the Indemnification
Agreement, the Parties hereby delete the phrase "Attention: Kenneth
Friedman" and hereby substitute in its place the phrase "Attention: Louis
Vitali".

(f) Paragraph 19 of the Indemnification Agreement is hereby
deleted in its entirety, and the following is hereby added in lieu thereof:

"19. Except as set forth in paragraph 13 of this
Indemnification Agreement, the obligations and liabilities of the
Indemnitors under this Indemnification Agreement shall terminate upon the
earliest to occur of (a) the date upon which the transactions described in
clause (x) of paragraph 2 above have been consummated, (b) the date upon
which 1290 Sixth has been sold or transferred by 1290 L.P. or all of the
limited partnership interests which Upper Tier Partnership may own in 1290
L.P., if any, have been sold or transferred by Upper Tier Partnership, and
(c) the date upon which the interest of the Upper Tier Partnership in 1290
L.P. has been sold or transferred pursuant to the terms of the 1290 L.P.
Agreement."

1.02 Partial Release of JMB/NYC Collateral. (a) Metropolis
hereby agrees that, immediately upon the closing (the "IPA Closing") of the
transactions under that certain Interest Purchase Agreement (as defined in
the Restructuring Agreement), it, along with JMB/NYC, shall, or shall cause
the appropriate parties to, execute and deliver to JMB/NYC (x) an escrow
release letter (attached hereto as Exhibit B) relating to that certain
Account Control Agreement (a true and correct copy of which is attached
hereto as Exhibit C), and (y) any other documentation necessary, to
effectuate a release from escrow at LaSalle Bank National Association
(successor to LaSalle National Trust, N.A.) and from the limitations set
forth in Section 12.2B of the limited partnership agreement of LTLP (or,
upon the liquidation of LTLP, of 1290 L.P.) of a portion of the "JMB
Collateral" (as such term is defined in the limited partnership agreement
of LTLP, or, upon the liquidation of LTLP, of 1290 L.P.) equal to
$4,460,715 (the "Release Amount") (calculated by multiplying 3/7 by
$10,000,000, plus $175,000). It is hereby agreed by the Parties that prior
to the consummation of the transactions under the Restructuring Agreement,
the Release Amount served as collateral for the obligations of the
Indemnitors under the Indemnification Agreement in respect of the 237
Property.

(b) Notwithstanding anything to the contrary contained
herein, it is hereby agreed by the Parties that the partial release of the
JMB Collateral set forth in the previous paragraph (a) shall not in any way
constitute a release of, or in any other way affect, the portion of such
collateral not released pursuant thereto.

SECTION 2

MISCELLANEOUS PROVISIONS

<PAGE>

2.01 No Further Amendment. Except as expressly amended
hereby, the Indemnification Agreement shall remain in full force and
effect.

2.02 Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute one
and the same agreement.

[SIGNATURE PAGE FOLLOWS]

<PAGE>

IN WITNESS WHEREOF, the undersigned have executed this
Amendment and Release Agreement as of the date and year first above
written.

METROPOLIS REALTY TRUST, INC.

By:
----------------------------------------
Name:
Title:

PROPERTY PARTNERS, L.P.

By: Carlyle Investors, Inc., General Partner

By:
----------------------------------------
Name:
Title:

CARLYLE-XIII ASSOCIATES, L.P.

By: Carlyle Investors, Inc., General Partner

By:
----------------------------------------
Name:
Title:

CARLYLE-XIV ASSOCIATES, L.P.

By: Carlyle Investors, Inc., General Partner

By:
----------------------------------------
Name:
Title:

<PAGE>

Exhibit A to the Amendment and Release Agreement

Indemnification Agreement

TO BE PROVIDED

<PAGE>

Exhibit B to the Amendment and Release Agreement

Escrow Release Letter

TO BE PROVIDED

<PAGE>

Exhibit C to the Amendment and Release Agreement

Account Control Agreement

TO BE PROVIDED

EXHIBIT 10-Z
- ------------

THIRD AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT

237/1290 UPPER TIER ASSOCIATES, L.P.

by and between

237/1290 UPPER TIER GP CORP.,

as General Partner,

CARLYLE MANAGERS, INC.,

as Special General Partner

AND
JMB/NYC OFFICE BUILDING ASSOCIATES, L.P.,

as Limited Partner

Dated: November 19, 1999

<PAGE>

TABLE OF CONTENTS

Page

ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . 2

ARTICLE II ORGANIZATIONAL MATTERS. . . . . . . . . . . . . . . . 5
2.1 Formation . . . . . . . . . . . . . . . . . . . . . . 5
2.2 Certificates. . . . . . . . . . . . . . . . . . . . . 5
2.3 Foreign Qualifications. . . . . . . . . . . . . . . . 5
2.4 Name. . . . . . . . . . . . . . . . . . . . . . . . . 5
2.5 Registered Office and Agent; Principal Office . . . . 6
2.6 Purpose; Powers . . . . . . . . . . . . . . . . . . . 6
2.7 Term. . . . . . . . . . . . . . . . . . . . . . . . . 6

ARTICLE III CAPITAL CONTRIBUTIONS . . . . . . . . . . . . . . . . 6
3.1 Capital Contributions of the General Partner. . . . . 6
3.2 Capital Contributions . . . . . . . . . . . . . . . . 6
3.3 Other Matters Relating to Capital Contributions . . . 6
3.4 Capital Accounts. . . . . . . . . . . . . . . . . . . 6

ARTICLE IV DISTRIBUTIONS OF NET CASH FLOW. . . . . . . . . . . . 7

ARTICLE V ALLOCATIONS OF PROFITS AND LOSSES . . . . . . . . . . 7

ARTICLE VI RIGHTS AND OBLIGATIONS OF THE GENERAL PARTNER . . . . 7
6.1 Management. . . . . . . . . . . . . . . . . . . . . . 7
6.2 Outside Activities of the General Partner . . . . . . 9
6.3 Employment of Experts or Advisors . . . . . . . . . . 9

ARTICLE VII RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS. . . . . . . . . 9
7.1 Limitation of Liability . . . . . . . . . . . . . . .10
7.2 Management of Business. . . . . . . . . . . . . . . .10
7.3 Outside Activities of the Special General Partner and
Limited Partners. . . . . . . . . . . . . . . . . . . . . . . . . . . .10
7.4 Covenant of the Special General Partner and the Limited
Partners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
7.5 This Section Intentionally Omitted. . . . . . . . . .10
7.6 Exercise of Put Right . . . . . . . . . . . . . . . .10

ARTICLE VIII AMENDMENTS OF LIMITED PARTNERSHIP AGREEMENT . . . . .11

ARTICLE IX LIMITATION ON SUBSTITUTION AND ASSIGNMENT OF A PARTNER'S
INTEREST. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
9.1 Transfer. . . . . . . . . . . . . . . . . . . . . . .11
9.2 Special General Partner and Limited Partners Right to
Transfer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
9.3 Transferred Partnership Interests Subject to this
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
9.4 Insolvency, Dissolution or Bankruptcy of a Limited
Partner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
9.5 Transfers by the General Partner. . . . . . . . . . .12
9.6 Admission of Successor General Partner. . . . . . . .12

ARTICLE X ACCOUNTING PROCEDURE. . . . . . . . . . . . . . . . .12
10.1 Books and Accounts. . . . . . . . . . . . . . . . . .12
10.2 Choice of Accountants; Tax Information. . . . . . . .12
10.3 Delivery of Information . . . . . . . . . . . . . . .12

ARTICLE XI DISSOLUTION . . . . . . . . . . . . . . . . . . . . .13
11.1 Dissolution . . . . . . . . . . . . . . . . . . . . .13
11.2 Liquidation . . . . . . . . . . . . . . . . . . . . .13
11.3 Rights of the Special General Partner and of the Limited
Partners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
11.4 No Obligation to Contribute Deficit . . . . . . . . .14

ARTICLE XII INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . .14

<PAGE>

ARTICLE XIII MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . .15
13.1 Notices . . . . . . . . . . . . . . . . . . . . . . .15
13.2 Counterparts. . . . . . . . . . . . . . . . . . . . .15
13.3 Nature of Partnership Interest. . . . . . . . . . . .15
13.4 Insolvency Proceedings. . . . . . . . . . . . . . . .16
13.5 Titles and Captions . . . . . . . . . . . . . . . . .16
13.6 Pronouns and Plurals. . . . . . . . . . . . . . . . .16
13.7 Further Action. . . . . . . . . . . . . . . . . . . .16
13.8 Binding Effect. . . . . . . . . . . . . . . . . . . .16
13.9 Creditors . . . . . . . . . . . . . . . . . . . . . .16
13.10 Waiver. . . . . . . . . . . . . . . . . . . . . . . .16
13.11 Applicable Law. . . . . . . . . . . . . . . . . . . .16
13.12 Invalidity of Provisions. . . . . . . . . . . . . . .16
13.13 Entire Agreement. . . . . . . . . . . . . . . . . . .16

Exhibit A

<PAGE>

THIRD AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT OF
237/1290 UPPER TIER ASSOCIATES, L.P.

(A Delaware Limited Partnership)

THIS THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF 237/1290 UPPER TIER ASSOCIATES, L.P. (the "Partnership"),
dated as of November 19, 1999 (this "Agreement") is entered into by and
between 237/1290 Upper Tier GP Corp., a Delaware corporation (the "General
Partner"), Carlyle Managers, Inc., a Delaware corporation (the "Special
General Partner"), JMB/NYC Office Building Associates, L.P., an Illinois
limited partnership (the "JMB Limited Partner" and/or the "Limited
Partner") and, solely for the purpose of agreeing to certain obligations
set forth in Section 7.6A hereof, Metropolis Realty Trust, Inc., a Maryland
corporation ("Metropolis").

WHEREAS, in accordance with the terms and conditions of the
Joint Plan of Reorganization of 237 Park Avenue Associates, L.L.C. and 1290
Associates L.L.C. (respectively the "237 LLC" and the "1290 LLC" and
collectively the "LLCs"), each a Delaware limited liability company, filed
under title 11 of the United States Code, 11 U.S.C. Sections 101 et seq.
(the "Plan"), (i) O&Y NY Building Corp. (the "Prior General Partner"), the
JMB Limited Partner and the O&Y Equity Company, L.P. ("Equityco") entered
into a Limited Partnership Agreement dated October 10, 1996 ( the "Original
Agreement") pursuant to which they formed the Partnership in accordance
with the Revised Uniform Limited Partnership Act of the State of Delaware,
(ii) the LLCs merged into the Partnership pursuant to an Agreement and Plan
of Merger dated October 10, 1996 (the "Merger Agreement"), with the
Partnership as the surviving entity (the "Merger"), (iii) pursuant to a
Redemption and Substitution Agreement dated October 10, 1996, the Prior
General Partner and Equityco withdrew from the Partnership and the General
Partner was admitted in its place, and (iv) the General Partner and the JMB
Limited Partner amended and restated the Original LP Agreement (as so
amended and restated, the "Amended and Restated Agreement");

WHEREAS, the Amended and Restated Agreement was amended and
restated in its entirety as of October 14, 1997 to admit Carlyle Managers,
Inc. as a Special General Partner (as amended and restated, the "Second
Amended and Restated Agreement"); and

WHEREAS, the Partnership has entered into an agreement (the
"Restructuring Agreement"), dated as of October 28, 1999 pursuant to which
the Partnership will, among other things, contribute its membership
interests in the entity that owns the real property known as 237 Park
Avenue, New York, New York, in exchange for Class A Partnership Interests
in Oak Hill Strategic Partners, L.P. (the "OHSP Interests").

WHEREAS, the parties hereto desire to amend and restate the
Second Amended and Restated Agreement in its entirety effective as of the
Closing Date (as defined in the Restructuring Agreement) to reflect the
consummation of such transactions.

NOW, THEREFORE, in consideration of the mutual covenants and on
the terms and conditions contained herein, and for other good, valid and
binding consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby
agree as follows:

ARTICLE I

DEFINITIONS

Certain terms used in this Agreement shall have the meanings
designated below.

(a) "Act" means the Delaware Revised Uniform Limited
Partnership Act, as in effect on the date hereof as it may be amended from
time to time hereafter, or any successor law.

(b) "Adverse Transaction" means (i) any sale, disposition,
transfer or exchange of the Partnership Property, or any property owned by
the Property Owning Partnership, (ii) any release, discharge or reduction
of non-recourse indebtedness of the Property Owning Partnership (other than
through payment of scheduled amortization (so long as the non-recourse
indebtedness of the Property Owning Partnership remains at all times
greater than $129,700,000), actions taken by a secured lender such as
application of insurance proceeds or condemnation awards or the exercise of
remedies, or in the case where the released indebtedness is concurrently
being replaced with other non-recourse indebtedness complying with clause
(B) below), (iii) any distribution of Partnership assets (other than
distributions of cash and other distributions by the Partnership and the
Property Owning Partnership, in each case, in the ordinary course of
business), or (iv) any other transaction or agreement to which any of the
Partnership or the Property Owning Partnership is a party, if as a result
of any such transaction or agreement described in (i), (ii), (iii) or (iv)
above, the Limited Partner would be required to recognize a material amount
of taxable income or gain prior to the Approval Right Termination Date.
Adverse Transactions shall specifically exclude (A) Partnership income
derived in the ordinary course of the Partnership's and the Property
Owning Partnership's business, (B) non-recourse refinancing of the property
owned by the Property Owning Partnership on commercially reasonable terms
in an aggregate amount equal to not less than $129,700,000, (C) payment of
amortization on non-recourse financing encumbering the property owned by
the Property Owning Partnership, provided that the outstanding balance of
such financing is not reduced below $129,700,000, in the aggregate and
except as otherwise provided in the parenthetical of clause (ii) above
(i.e. actions taken by a secured lender such as application of insurance
proceeds or condemnation awards or the exercise of remedies, or in the case
where released indebtedness is concurrently being replaced with other non-
recourse indebtedness complying with clause (B) above), (D) the
consummation of the transactions expressly provided for in Section 2.01 of
the Restructuring Agreement, (E) a transfer of the any property owned by
the Property Owning Partnership pursuant to an involuntary foreclosure or
similar action arising from a default by the Property Owning Partnership
with respect to its obligations under its indebtedness, (F) a transfer of
the property of the Property Owning Partnership pursuant to a consensual
foreclosure or similar action (including, without limitation, a deed in
lieu of foreclosure) arising from a default by the Property Owning
Partnership with respect to its obligations under its indebtedness;
provided that the default is a bona fide default and the foreclosure or
deed in lieu of foreclosure is not a collusive transaction between the
holders of such indebtedness and Metropolis or any shareholders or
Affiliates of Metropolis or any of their partners, members or Affiliates
attributable to any commonality of ownership between the beneficial
ownership of such indebtedness and any such Person, (G) any Metropolis Sale
or sale, exchange, transfer, encumbrance or other disposition (whether by
or through any intervening entity or entities) of Metropolis' interest as a
limited partner of the Property Owning Partnership or the property owned by
the Property Owning Partnership during the period commencing on January 1,
2000 and ending on February 28, 2001 if, simultaneous with any such
transaction, the JMB Limited Partner receives its proportionate share of
the Limited Partner Sale Distribution Amount (as defined in the Property
Owning Partnership Agreement) and (H) payment of the Limited Partner Sale
Distribution Amount (as defined in the Property Owning Partnership
Agreement) or the authorized exercise of the Purchase Right (as defined in
the Property Owning Partnership Agreement) or the Put Right (as defined in
the Property Owning Partnership Agreement) and the consummation of the
transactions incidental to the exercise of such rights.

(c) "Affiliate" means, (a) with respect to any individual
Person, any member of the Immediate Family of such Person or a trust
established for the benefit of such member, or (b) with respect to any
Entity, any Person which, directly or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control
with, any such Entity.

(d) "Approval Right Termination Date" means the earliest of
(i) March 1, 2001, and (ii) the date on which the Partnership no longer
holds the Property Owning Partnership Interest as a result of the
authorized exercise of the Purchase Right or the Put Right (as such terms
are defined in the Property Owning Partnership Agreement) pursuant to
Section 12.2A or 12.2C of the Property Owning Partnership Agreement or
pursuant to such other transaction which does not constitute an Adverse
Transaction, (iii) the date on which the JMB Limited Partner no longer
holds a Partnership Interest in the Partnership, and (iv) the Default Date.

(e) "Capital Contribution" means, with respect to any
Partner, any cash, cash equivalents or the gross asset value of the
Property, as determined by the General Partner in its sole and absolute
discretion (except as otherwise provided in this Agreement), which such
Partner contributes or is deemed to contribute to the Partnership pursuant
to Article III hereof.

(f) "Certificate" means the Certificate of Limited
Partnership of the Partnership filed in the Office of the Secretary of
State of Delaware, as such certificate may be amended and/or restated from
time to time.

(g) "Closing Date" shall have the meaning set forth in the
Restructuring Agreement.

(h) "Code" means the Internal Revenue Code of 1986, as
amended from time to time (or any corresponding provisions of succeeding
law).

(i) "Default Date" shall have the meaning set forth in the
Property Owning Partnership Agreement.

(j) "Distribution" means any distribution pursuant to
Articles IV or XI hereof.

(k) "Entity" means any general partnership, limited
partnership, corporation, joint venture, trust, business trust, real estate
investment trust, limited liability company, cooperative or association.

(l) "Fiscal Year" means the period commencing on any
January 1 and ending on the earlier to occur of (A) the next December 31
and (B) the date on which all assets of the Partnership are distributed
pursuant to Article XI hereof and the Certificate has been cancelled
pursuant to the Act.

(m) "FW Strategic" means FW Strategic Management, L.P., a
Texas limited partnership.

(n) "General Partner" means 237/1290 Upper Tier GP Corp., a
Delaware corporation, in its capacity as General Partner hereunder and all
other Persons hereafter being or acting as General Partner of the
Partnership, individually and collectively.

(o) "Indemnitee" means (i) any Person made a party to a
proceeding by reason of (A) such Person's status as (1) the General
Partner, (2) a stockholder, director, trustee or officer of the Partnership
or the General Partner, or (3) a director, trustee or officer of any other
Entity, each Person (including a Limited Partner) serving in such capacity
at the request of the Partnership or the General Partner, or (B) his or its
liabilities, pursuant to a loan guarantee or otherwise, for any
indebtedness of the Partnership (including, without limitation, any
indebtedness which the Partnership has assumed or taken assets subject to);
and (ii) such other Persons (including affiliates of the General Partner to
the Partnership) as the General Partner may designate from time to time
(whether before or after the event giving rise to potential liability), in
its sole and absolute discretion.

(p) "JMB Indemnitors" shall mean Property Partners, L.P.,
Carlyle-XIII Associates, L.P. and Carlyle-XIV Associates, L.P.

(q) "JMB Limited Partner" shall have the meaning set forth in
the Preamble to this Agreement.

(r) "JMB Put Right" shall have the meaning set forth in
Section 7.7 of this Agreement.

(s) "Limited Partner" shall have the meaning set forth in the
Preamble to this Agreement and shall refer to any additional Limited
Partner admitted to the Partnership in accordance with the terms hereof.

(t) "LLC(s)" shall have the meanings set forth in the
Recitals to this Agreement.

(u) "Merger" means the merger of the LLCs with and into the
Partnership pursuant to the Merger Agreement.

(v) "Merger Agreement" means the Agreement and Plan of
Merger, dated as of October 10, 1996 between the Partnership and the LLCs.

(w) "Metropolis" means Metropolis Realty Trust, Inc., a
Maryland corporation.

(x) "Metropolis Sale" has the meaning given thereto in the
Property Owning Partnership Agreement.

(y) "Net Cash Flow" means the excess of all cash receipts of
any kind received by the Partnership over the sum of the amounts of (i)
Operating Expenses, and (ii) any reserves established by the General
Partner.

(z) "OHSP" means Oak Hill Strategic Partners, L.P., a
Delaware limited partnership.

(aa) "OHSP Interests" shall have the meaning set forth in the
Recitals to this Agreement.

(ab) "Operating Expenses" means all cash expenses, costs,
debts and disbursements of every kind and nature which the Partnership
shall pay or become obligated to pay in connection with the business of the
Partnership or the performance of the General Partner's duties and
obligations under this Agreement, including, without limitation, debt
service, audit and legal expenses and management fees.

(ac) "Partners" means the General Partner, the Special General
Partner and the Limited Partners, where no distinction is required by the
context in which the terms is used herein. "Partner" means any one of the
Partners.

(ad) "Partnership" means 237/1290 Upper Tier Associates, L.P.

(ae) "Partnership Interest(s)" means that ownership interest
of a Partner, expressed as a percentage, in the Partnership's profits and
losses, other items of income, gain, losses, deductions, expenses and
credits, and distributions of net cash receipts at any particular time,
including the right of such Partner to any and all benefits to which a
Partner may be entitled as provided in this Agreement and under the Act,
together with the obligation of such Partner to comply with all the terms
and provisions of this Agreement and the Act. The Partnership Interest of
each Partner is set forth on Exhibit A.

(af) "Partnership Property" means the Property Owning
Partnership Interest, the OHSP Interests and any other property the
Partnership may acquire after the date hereof.

(ag) "Person" means any individual, corporation, company,
partnership, joint venture, trust, association, unincorporated
organization, other entity or group, or any domestic or foreign national,
state or municipal or other local government or multi-national body any
subdivision, agency, commission or authority thereof.

(ah) "Plan" shall have the meaning set forth in the Recitals
to this Agreement.

(ai) "Property Owning General Partner" means 1290 GP Corp., a
Delaware corporation.

(aj) "Property Owning Partnership" means 1290 Partners, L.P.,
a Delaware limited partnership.

(ak) "Property Owning Partnership Agreement" means the Amended
and Restated Agreement of Limited Partnership of the Property Owning
Partnership, dated as of the date hereof.

(al) "Property Owning Partnership Interest" shall mean the
Partnership's ownership interest, as a limited partner, in the Property
Owning Partnership pursuant to the Property Owning Partnership Agreement.

(am) "Restructuring Agreement" shall have the meaning set
forth in the recitals.

(an) "Special General Partner" shall have the meaning set
forth in the Preamble to this Agreement.

(ao) "Tax Matters Partner" shall have the meaning set forth in
Section 10.2 of this Agreement.

ARTICLE II

ORGANIZATIONAL MATTERS

2.1 FORMATION. The General Partner, the Special General
Partner and the Limited Partners hereby agree to continue the Partnership
as a limited partnership pursuant and subject to the Act. The Original
Agreement was effective from the date thereof up to, but not including, the
effective time of the Amended and Restated Agreement. The Amended
Agreement was effective up to, but not including, the effective date of the
Second Amended and Restated Agreement. The Second Amended and Restated
Agreement was effective from and including the date thereof up to the
Closing Date (as defined in the Restructuring Agreement). This Agreement
shall become effective on the Closing Date. Except as expressly provided in
this Agreement, the rights and obligations of the Partners and the
administration and termination of the Partnership shall be governed by the
Act.

2.2 CERTIFICATES The General Partner shall file, record and
publish such certificates and other documents as may be necessary and
appropriate to comply with the requirements for the organization and
operation of a limited partnership under the Act.

2.3 FOREIGN QUALIFICATIONS. If the business of the
Partnership is carried on or conducted in any state other than the State of
Delaware, then the parties agree that this Partnership shall be qualified
to conduct business in accordance with the laws of each such other state in
which business is conducted by the Partnership. The parties agree to
execute such other and further documents as may be necessary or appropriate
to permit the General Partner to qualify this Partnership, or otherwise to
comply with requirements for a limited partnership to conduct business, in
each such state. The General Partner shall execute and file in the proper
offices such certificates as may be required by the Assumed Name Act or
similar law in effect in the counties and other governmental jurisdictions
in which the Partnership may elect to conduct business.

2.4 NAME. The name of the Partnership is "237/1290 Upper
Tier Associates, L.P." The business of the Partnership shall be conducted
under the name listed above or under such other names as the General
Partner deems appropriate. The General Partner, in its sole discretion
may, upon five days' prior written notice to the Limited Partners, change
the name of the Partnership.

2.5 REGISTERED OFFICE AND AGENT; PRINCIPAL OFFICE. The
address of the registered office of the Partnership in the State of
Delaware and the name and address at the registered agent for service of
process on the Partnership in the State of Delaware is The Corporation
Trust Company, 1029 Orange Street, Wilmington (New Castle County), Delaware
19801. The principal office of the Partnership shall be c/o Victor Capital
Group, L.P., 605 Third Avenue, 26th Floor, New York, New York 10016, Attn:

John Klopp or such other place as the General Partner may from time to time
designate by notice to the Limited Partners. The Partnership may maintain
offices at such other place or places within or outside the State of
Delaware as the General Partner deems advisable.

2.6 PURPOSE; POWERS. The purpose and nature of the business
to be conducted by the Partnership is to hold the Partnership Property and
serve as a limited partner of the Property Owning Partnership. The
Partnership is empowered to do any and all acts and things necessary,
appropriate, proper, advisable, incidental to or convenient for the
furtherance and accomplishment of the purposes and business described
herein.

2.7 TERM. The term of the Partnership shall continue until
December 31, 2099, unless the Partnership is dissolved sooner pursuant to
any provision of this Agreement.

ARTICLE III

CAPITAL CONTRIBUTIONS

3.1 CAPITAL CONTRIBUTIONS OF THE GENERAL PARTNER. The
General Partner has made a Capital Contribution of $1 in cash to the
Partnership and the Special General Partner has agreed to provide services
to the Partnership as set forth in Section 10.2 hereof. In consideration
therefor, the General Partner and the Special General Partner have received
the Partnership Interests set forth in Exhibit A hereto.

3.2 CAPITAL CONTRIBUTIONS. As provided in the Merger
Agreement, upon the consummation of the Merger, the Partnership succeeded
to all of the LLCs' assets and liabilities (the "LLC Net Assets"). Upon
the consummation of the Merger, the Partnership agreed that the LLC Net
Assets were deemed to be the Capital Contributions of the JMB Limited
Partner, and (ii) the LLC Net Assets had a gross fair market value of
$100,000.

3.3 OTHER MATTERS RELATING TO CAPITAL CONTRIBUTIONS.

A. Except as otherwise provided by the terms of this
Agreement, no Partner shall be entitled to withdraw, or to a return of, any
part of its Capital Contribution, or to receive property or assets other
than cash in return thereof, and the General Partner shall not be liable to
the Limited Partners for a return of their Capital Contributions.

B. No Partner shall be entitled to priority over any other
Partner, either with respect to a return of his Capital Contribution, or to
allocations of taxable income, gains, losses or credits, or to
distributions, except as provided in this Agreement.

C. No interest shall be paid on Capital Contributions.

D. No Partner shall be obligated to make any further Capital
Contribution to the Partnership.

3.4 CAPITAL ACCOUNTS. A separate capital account shall be
established for each Partner on the books of the Partnership on the dates
on which such Partner makes its Capital Contributions, as provided herein.
Each such capital account will thereafter be maintained on the books of the
Partnership. Each Partner's capital account will be increased by that
Partner's Capital Contributions, advances and allocation of income and gain
and decreased by that Partner's distributions and allocation of losses.

ARTICLE IV

DISTRIBUTIONS OF NET CASH FLOW

Subject to Article XI, the Partnership shall distribute to the
Partners any Net Cash Flow at such times as the General Partner shall
reasonably determine to be appropriate. Distributions of Net Cash Flow
shall be made to the Partners in accordance with their respective
Partnership Interests. Notwithstanding the foregoing, the Partners
acknowledge that the interest of the JMB Limited Partner is subject to a
Second Amended, Restated and Consolidated Security Agreement, dated as of
October 10, 1996, executed and delivered pursuant to the Plan and the JMB
Limited Partner and the Special General Partner agree that the General
Partner shall be authorized to pay any distributions otherwise payable to
the JMB Limited Partner or the Special General Partner hereunder to or at
the direction of the holder of the Second Amended, Restated and
Consolidated Promissory Note secured thereby.

ARTICLE V

ALLOCATIONS OF PROFITS AND LOSSES

5.1 All items of income, gain, loss or deduction for any
Fiscal Year shall be allocated to the Partners in accordance with their
respective Partnership Interests.

5.2 The Partnership shall use the "remedial method" described
in Treasury Regulation Section 1.704-3(b) and allocations of nonrecourse
debt shall be made in accordance therewith. The effect of this Agreement
shall be that the JMB Limited Partner shall receive an allocation of
Partnership nonrecourse debt, as of the date hereof, that is not less than
$129,700,000.

ARTICLE VI

RIGHTS AND OBLIGATIONS OF THE GENERAL PARTNER

6.1 MANAGEMENT.

A. Except as otherwise expressly provided in this Agreement,
all management powers over the business and affairs of the Partnership are
and shall be exclusively vested in the General Partner, and, except as
provided in Section 6.1D hereof with respect to the JMB Limited Partner and
in Section 10.2 hereof with respect to the Special General Partner, no
Limited Partner nor the Special General Partner shall have any right to
participate in or exercise control or management power over the business
and affairs of the Partnership. No third party shall have any right to
rely upon the authority of the Special General Partner or the Limited
Partner to take any action on behalf of the Partnership, except as
expressly set forth in this Agreement. The General Partner may not be
removed by the Limited Partners or the Special General Partner with or
without cause. In addition to the powers now or hereafter granted a
general partner of a limited partnership under applicable law or which are
granted to the General Partner under any other provision of this Agreement,
the General Partner shall have, subject to Section 6.1D hereof, full power
and authority to do all things deemed necessary or desirable by it to
conduct the business of the Partnership, to exercise all powers and to
effectuate the purposes set forth in Section 2.6 hereof, including, without
limitation, the power and authority to:

1. to acquire, sell, transfer, exchange, manage or otherwise
dispose of all or a portion of the Partnership Property upon such terms and
for such consideration as the General Partner may, in its sole and absolute
discretion determine;

2. to take or enter into, perform and carry out contracts
and agreements of every kind necessary or incidental to the purposes of the
Partnership;

3. to take or omit such other or further action in
connection with the Partnership's business as may, in the opinion of the
General Partner, be necessary or desirable to further the purposes of the
Partnership, including, without limitation, actions pursuant to the
Property Owning Partnership Agreement;

4. to invest such funds as are temporarily not required for
Partnership purposes; and

5. to carry on any other activities the General Partner may
reasonably deem necessary, in connection with or incident to any of the
foregoing.

B. In connection with such management and subject to any
limitations set forth elsewhere in this Agreement, the General Partner:

1. Shall maintain or cause to be maintained, at the expense
of the Partnership, complete and accurate records of all correspondence,
documents or instruments of any nature relating to the Partnership
business. Such records, together with such supporting evidence thereof as
is in the control and possession of the Partnership or of the General
Partner, shall be kept in the principal office of the General Partner or of
the Partnership for such periods as the General Partner deems appropriate.
The Partners and/or their authorized representatives, shall have the right
to inspect and/or copy any or all of the above-described records during
normal business hours.

2. Shall execute any and all documents or instruments of any
kind which the General Partner may reasonably deem appropriate in carrying
out the purposes of the Partnership.

3. Shall maintain, or cause to have maintained, at the
expense of the Partnership, adequate records and accounts of all
transactions, operations and expenditures and shall furnish to or cause to
be furnished to the Partners annual statements of account as of the end of
each calendar year.

C. The Limited Partner and the Special General Partner agree
that the General Partner is authorized to execute, deliver and perform the
above-mentioned agreements and transactions on behalf of the Partnership
without any further act, approval or vote of the Limited Partner or the
Special General Partner (except as provided in Section 6.1D hereof).
Notwithstanding any other provision of this Agreement, to the fullest
extent permitted under the Act or other applicable law, rule or regulation,
the execution, delivery or performance by the General Partner or the
Partnership of any agreements authorized or permitted under this Agreement
shall not constitute a breach by the General Partner of any duty that the
General Partner may owe the Partnership, the Special General Partner or the
Limited Partner or any other Persons under this Agreement or of any duty
stated or implied by law or equity.

D. Notwithstanding anything to the contrary set forth in
this Agreement, (x) until the Approval Right Termination Date in the case
of items 1-6 of this Section 6.1D and (y) at any time in the case of item 7
of this Section 6.1D, the General Partner shall not, without the prior
written consent of the JMB Limited Partner (which may be given or withheld
in its sole and absolute discretion), have the power to take, on behalf of
the Partnership as a limited partner of the Property Owning Partnership,
the following actions:

1. Consent to any Adverse Transaction pursuant to Section
8.1E of the Property Owning Partnership Agreement;

2. Exercise the Partnership's Put Right (as such term is
defined in the Property Owning Partnership Agreement) to require the
Property Owning General Partner or Metropolis to purchase the Property
Owning Partnership Interest pursuant to Section 12.2C of the Property
Owning Partnership Agreement;

3. Effect the sale, disposition, exchange or transfer of the
Property Owning Partnership Interest if such transaction would constitute
an Adverse Transaction;

4. Consent to the amendment of the Property Owning
Partnership Agreement pursuant to Sections 15.1B and 15.1C of such
Partnership Agreement;

5. Consent to the dissolution of the Property Owning
Partnership pursuant to Section 14.1C of the Property Owning Partnership
Agreement;

6. Cause or permit (to the extent within the General
Partner's reasonable control) any Adverse Transaction; provided however
that the General Partner shall be under no obligation to commence
litigation or to incur any expense (unless the JMB Limited Partner shall
fund such expense) in order to avoid or prevent an Adverse Transaction from
occurring; and

7. Cause or permit the sale, disposition, exchange or
transfer of the OHSP Interests, unless FW Strategic properly exercises its
right to purchase the OHSP Interests pursuant to Section 4.02(c) of the
Restructuring Agreement.

6.2 OUTSIDE ACTIVITIES OF THE GENERAL PARTNER. The General
Partner shall devote such time and effort to the business of the
Partnership as the General Partner shall reasonably deem necessary to
promote adequately the interests of the Partnership and the interests of
the Partners; however, it is specifically understood and agreed that the
General Partner shall not be required to devote full time to the business
of the Partnership and that the Partners and their respective stockholders,
partners, directors, officers and affiliates may at any time and from time
to time engage in and possess interests in other business ventures of any
and every type and description including business interests and activities
that are in direct competition with the Partnership or that are enhanced by
the activities of the Partnership, and neither the Partnership nor any
Partner shall by virtue of this Agreement or otherwise have any right,
title or interest in or to such independent ventures.

6.3 EMPLOYMENT OF EXPERTS OR ADVISORS. The General Partner
may employ or retain such counsel, accountants, appraisers or other experts
or advisors as the General Partner may reasonably deem appropriate for the
purpose of discharging its duties hereunder, and shall be entitled to pay
the fees of any such persons from the funds of the Partnership. The
General Partner may act, and shall be protected in acting in good faith, on
the opinion or advice of, or information obtained from, any such counsel,
accountant, appraiser or other expert or advisor, whether retained or
employed by the Partnership, the General Partner, or otherwise, in relation
to any matter connected with the administration or operation of the
business and affairs of the Partnership.

ARTICLE VII

RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS
AND THE SPECIAL GENERAL PARTNER

7.1 LIMITATION OF LIABILITY. The Limited Partners and the
Special General Partner shall have no liability under this Agreement except
as expressly provided in this Agreement, or under the Act.

7.2 MANAGEMENT OF BUSINESS. Neither the Special General
Partner nor any Limited Partner shall take part in the operation,
management or control (within the meaning of the Act) of the Partnership's
business, transact any business in the Partnership's name or have the power
to sign documents for or otherwise bind the Partnership except as set forth
in Section 10.2 hereof. No third party shall have any right to rely upon
the authority of the Special General Partner on behalf of the Partnership,
except as expressly set forth in this Agreement. The transaction of any
such business by the General Partner, any of its affiliates or any officer,
director, employee, partner, agent or trustee of the General Partner, the
Partnership or any of their affiliates, in their capacity as such, shall
not affect, impair or eliminate the limitations on the liability of the
Limited Partners under this Agreement.

7.3 OUTSIDE ACTIVITIES OF THE SPECIAL GENERAL PARTNER AND
LIMITED PARTNERS. The Special General Partner and any Limited Partner and
any officer, director, partner, employee, agent, trustee, affiliate or
shareholder of the Special General Partner or of any Limited Partner shall
be entitled to and may have business interests and engage in business
activities in addition to those relating to the Partnership, including
business interests and activities that are in direct competition with the
Partnership or that are enhanced by the activities of the Partnership.
Neither the Partnership nor any Partners shall have any rights by virtue of
this Agreement in any business ventures of the Special General Partner or
any Limited Partner. None of the Special General Partner or the Limited
Partners nor any other Person shall have any rights by virtue of this
Agreement or the Partnership relationship established hereby in any
business ventures of any other Person and such Person shall have no
obligation pursuant to this Agreement to offer any interest in any such
business ventures to the Partnership, the Special General Partner or any
Limited Partner or any such other Person, even if such opportunity is of a
character which, if presented to the Partnership, the Special General
Partner or any Limited Partner or such other Person, could be taken by such
Person.

7.4 COVENANT OF THE SPECIAL GENERAL PARTNER AND THE LIMITED
PARTNERS. The Special General Partner and each Limited Partner hereby
warrants and covenants to the Partnership, provided that any of the
following is not an Adverse Transaction, that neither it nor any of its
partners or their respective officers, directors, partners, stockholders,
agents and affiliates shall intentionally interfere with (x) the exercise
by the Property Owning General Partner of the Purchase Right (as such term
is defined in the Property Owning Partnership Agreement) pursuant to
Section 12.2A of the Property Owning Partnership Agreement, or (y) any
disposition, mortgage, pledge, encumbrance, hypothecation or exchange of
the Property Owning Partnership Interest by the Partnership or the Property
(as defined in the Property Owning Partnership Agreement) by the Property
Owning Partnership or the merger or other combination of the Property
Owning Partnership with or into another entity in accordance with the terms
of this Agreement, or the Property Owning Partnership Agreement.

7.5 THIS SECTION INTENTIONALLY OMITTED.

7.6 EXERCISE OF PUT RIGHT.

A. The General Partner shall, upon the written request of
the JMB Limited Partner, promptly cause the Partnership to exercise its Put
Right (as such term is defined in the Property Owning Partnership
Agreement) to require the Property Owning General Partner and Metropolis,
jointly and severally, to purchase the Property Owning Partnership Interest
pursuant to Section 12.2C of the Property Owning Partnership Agreement.

B. The General Partner shall, upon the written request of
the JMB Limited Partner, promptly cause the Partnership to exercise its
right to sell the OHSP Interests to FW Strategic or OHSP pursuant to the
proviso of Section 4.02(d)(ii) of the Restructuring Agreement.

C. Following (i) the exercise of the Put Right pursuant to
Section 7.6A and (ii) the receipt by the JMB Limited Partner of all amounts
to be received as a result thereof, the General Partner shall, upon receipt
of the written election of the JMB Limited Partner at any time, in the JMB
Limited Partner's sole discretion, cause its Partnership Interest to be
converted to a limited partner interest, and the Special General Partner
shall thereupon become the successor General Partner.

D. Following (i) the exercise of the Purchase Right (as
defined in Property Owning Partnership Agreement) the pursuant to Section
12.2A of the Property Owning Partnership Agreement and (ii) the receipt by
the JMB Limited Partner of all amounts to be received as a result thereof,
the General Partner shall, upon receipt of the written election of the JMB
Limited Partner at any time, in the JMB Limited Partner's sole discretion,
cause its Partnership Interest to be converted to a limited partner
interest, and the Special General Partner shall thereupon become the
successor General Partner.

ARTICLE VIII

AMENDMENTS OF LIMITED PARTNERSHIP AGREEMENT

This Agreement may be amended only by instrument in writing
signed by the General Partner, the Special General Partner and the Limited
Partner.

ARTICLE IX

LIMITATION ON SUBSTITUTION AND
ASSIGNMENT OF A PARTNER'S INTEREST

9.1 TRANSFER.

A. The term "Transfer," when used in this Article IX with
respect to a Partnership Interest, shall be deemed to refer to a
transaction by which the General Partner purports to assign all or any part
of its Partnership Interest to another Person or by which the Special
General Partner or a Limited Partner purports to assign all or any part of
its Partnership Interest to another Person.

B. No Partnership Interest shall be Transferred, in whole or
in part, except in accordance with the terms and conditions set forth in
this Article IX. Any Transfer or purported Transfer of a Partnership
Interest not made in accordance with this Article IX shall be null and
void.

9.2 SPECIAL GENERAL PARTNER AND LIMITED PARTNERS RIGHT TO
TRANSFER. Subject to the provisions of Sections 7.6, and this Section 9.2,
neither the Special General Partner nor any Limited Partner shall sell,
assign, transfer or convey all or any portion of its Partnership Interest
to any person or entity without the prior written consent of the General
Partner. Except for the security interest created pursuant to the Second
Amended, Restated and Consolidated Promissory Note in the original
principal amount of $88,572,780, dated October 10, 1996, made by the JMB
Limited Partner in favor of Metropolis, the Second Amended, Restated and
Consolidated Security Agreement, dated October 10, 1996, between the JMB
Limited Partner and Metropolis, and the documents related thereto, neither
the Special General Partner nor any Limited Partner shall pledge, encumber,
place or suffer to exist a lien on its Partnership Interest without the
prior written consent of the General Partner. No successor to the Special
General Partner's Partnership Interest nor the Limited Partner's
Partnership Interest shall become a substituted limited partner, as that
term is used in the Act, without the prior written consent of the General
Partner. Any consent from the General Partner required under this Section
9.2 may be granted or withheld by the General Partner in its sole
discretion.

9.3 TRANSFERRED PARTNERSHIP INTERESTS SUBJECT TO THIS
AGREEMENT. Sales, assignments, transfers, conveyances and pledges of
Partnership Interests pursuant to this Article IX shall be subject to, and
the transferee or pledgee shall acquire the transferred Partnership
Interests subject to, all of the terms and provisions of this Agreement.

9.4 INSOLVENCY, DISSOLUTION OR BANKRUPTCY OF A LIMITED
PARTNER. The insolvency, dissolution or bankruptcy of the Special General
Partner or of a Limited Partner shall not terminate the Partnership. In
such event, the trustee, representative, or other successor in interest of
such Limited Partner or the Special General Partner shall have only the
rights of an assignee of a Limited Partner which does not become a
substituted limited partner under the Act.

9.5 TRANSFERS BY THE GENERAL PARTNER.

A. The General Partner may Transfer all or any part of its
Partnership Interest or withdraw as General Partner, in its sole discretion
and without the consent of any Limited Partners or the Special General
Partner; provided that the General Partner may withdraw as general partner
only in connection with a Transfer of its Partnership Interest and
immediately following the admission of a successor General Partner, as
general partner, in accordance with this Article IX.

B. If the General Partner withdraws as general partner in
accordance with clause A. above, its Partnership Interest shall immediately
be converted into a limited partner interest and the General Partner shall
be entitled to receive distributions from the Partnership and the share of
income, gain, loss, deduction and credit that were otherwise attributable
to its Partnership Interest.

9.6 ADMISSION OF SUCCESSOR GENERAL PARTNER. A successor to
all of the General Partner's Partnership Interest pursuant to this Article
IX who is proposed to be admitted as a successor General Partner shall be
admitted to the Partnership as the General Partner, effective immediately
prior to such Transfer. Any such transferee shall carry on the business of
the Partnership without dissolution. In each case, the admission shall be
subject to the successor General Partner executing and delivering to the
Partnership an acceptance of all of the terms and conditions of this
Agreement and such other documents or instruments as may be required to
effect the admission.

ARTICLE X

ACCOUNTING PROCEDURE

10.1 BOOKS AND ACCOUNTS. The General Partner shall keep or
cause to be kept full, accurate, complete and proper books and accounts of
all operations of the Partnership. Such books shall be kept in accordance
with sound accounting practices consistently applied.

10.2 CHOICE OF ACCOUNTANTS; TAX INFORMATION. Notwithstanding
anything to the contrary in this Agreement or any status of the General
Partner as general partner, the Special General Partner is hereby
designated as the "tax matters partner" as such term is defined in Section
6231(a)(7) of the Code. The Special General Partner shall have full and
exclusive authority over all Partnership tax matters, including, without
limitation, with respect to those matters under Section 11.2 of the
Property Owning Partnership Agreement, reserved to the Limited Partner of
such partnership under such Section 11.2 of the Property Owning Partnership
Agreement. The Partnership's tax returns shall be prepared by a "Big Five"
accounting firm selected by the Special General Partner. The Special
General Partner shall sign and file tax returns prepared by the
Partnership's accountant in consultation with the General Partner. The
Special General Partner shall annually deliver or cause to be delivered to
the Limited Partners all information forms reasonably necessary for federal
tax purposes.

10.3 DELIVERY OF INFORMATION. The General Partner shall
promptly deliver to the Special General Partner and the JMB Limited Partner
copies of all reports and information received from the Property Owning
Partnership, OHSP and FW Strategic.

ARTICLE XI

DISSOLUTION

11.1 DISSOLUTION. The Partnership shall not be dissolved by
the admission of substituted Limited Partners or additional Limited
Partners or by the admission of a successor General Partner in accordance
with the terms of this Agreement. In the event of the withdrawal of the
General Partner, any successor General Partner shall continue the business
of the Partnership. The Partnership shall dissolve, and its affairs shall
be wound up, only upon the first to occur of any of the following:

A. the expiration of its term as provided in Section 2.7
hereof;

B. an event of withdrawal of the General Partner, as defined
in the Act, unless, within ninety (90) days after such event of withdrawal
all of the remaining Partners agree in writing to continue the business of
the Partnership and to the appointment, effective as of the date of
withdrawal, of a successor General Partner;

C. (i) prior to the Approval Right Termination Date, an
election to dissolve the Partnership made by the General Partner, with the
consent of the JMB Limited Partner (which may be given or withheld in its
sole and absolute discretion), and (ii) after the Approval Right
Termination Date, an election to dissolve the Partnership made by the
General Partner, without the consent of the Limited Partner or the Special
General Partner;

D. entry of a decree of judicial dissolution of the
Partnership pursuant to the provisions of the Act;

E. the sale of all or substantially all of the assets and
properties of the Partnership.

11.2 LIQUIDATION. In the event of dissolution of the
Partnership pursuant to Section 11.1 where the business of the Partnership
is not reconstituted, liquidation shall occur. The General Partner shall
supervise the liquidation of the Partnership unless a wrongful act of the
General Partner dissolved the Partnership or the Limited Partners elect
another Partner to do so. In the event of any liquidation of the
Partnership under this Agreement or the Act, except as otherwise provided
herein, the proceeds of liquidating the Partnership shall be applied and
distributed in the following order of priority (each item to be satisfied
in full in the order listed below before any of such proceeds are allocated
to the subsequent item):

(a) First, to creditors, including Partners who are creditors
(to the extent not otherwise prohibited by law), in satisfaction of
liabilities of the Partnership (whether by payment or the making of
reasonable provision for payment therefor), other than liabilities for
which reasonable provision for payment has been made and liabilities for
interim distributions to Partners and distributions to Partners on
withdrawal; then

(b) Second, to the setting up of any reserves which the
supervising Partner (or, if applicable, the liquidating trustee) determines
to be reasonably necessary for any contingent liabilities of the
Partnership or of any Partner arising out of, or in connection with, a
Partnership liability; then

The General Partner shall not receive any compensation for any
services performed pursuant to this Article XI.

11.3 RIGHTS OF THE SPECIAL GENERAL PARTNER AND OF THE LIMITED
PARTNERS. Except as otherwise provided in this Agreement, the Special
General Partner and each Limited Partner shall look solely to the assets of
the Partnership for the return of its Capital Contributions and shall have
no right or power to demand or receive property other than cash from the
Partnership. Neither any Limited Partner nor the Special General Partner
shall have priority over one another as to the return of its Capital
Contributions, distributions, or allocations.

11.4 NO OBLIGATION TO CONTRIBUTE DEFICIT. If any Partner
has a deficit balance in its capital account (after giving effect to all
contributions, distributions and allocations for all taxable years,
including the year during which such liquidation occurs), such Partner
shall have no obligation to make any contribution to the capital of the
Partnership with respect to such deficit, and such deficit shall not be
considered a debt owed to the Partnership or to any other Person for any
purpose whatsoever.

ARTICLE XII

INDEMNIFICATION

12.1 To the fullest extent permitted by Delaware law, the
Partnership shall indemnify each Indemnitee from and against any and all
losses, claims, damages, liabilities, joint or several, expenses
(including, without limitation, reasonable attorneys' fees and other legal
fees and expenses), judgments, fines, settlements, and other amounts
arising from any and all claims, demands, actions, suits or proceedings,
civil, criminal, administrative or investigative, that relate to the
operations of the Partnership, the Special General Partner or the General
Partner as set forth in this Agreement, in which such Indemnitee may be
involved, or is threatened to be involved, as a party or otherwise, except
to the extent it is finally determined by a court of competent
jurisdiction, from which no further appeal may be taken, that such
Indemnitee's action constituted intentional acts or omissions constituting
willful misconduct or fraud. Without limitation, the foregoing indemnity
shall extend to any liability of any Indemnitee, pursuant to a loan
guaranty or otherwise for any indebtedness of the Partnership (including,
without limitation, any indebtedness which the Partnership has assumed or
taken subject to), and the General Partner is hereby authorized and
empowered, on behalf of the Partnership, to enter into one or more
indemnity agreements consistent with the provisions of this Article XII in
favor of any Indemnitee having or potentially having liability for any such
indebtedness. Any indemnification pursuant to this Article XII shall be
made only out of the assets of the Partnership, and neither the General
Partner, the Special General Partner nor any Limited Partner shall have any
obligation to contribute to the capital of the Partnership, or otherwise
provide funds, to enable the Partnership to fund its obligations under this
Article XII.

12.2 Reasonable expenses incurred by an Indemnitee who is a
party to a proceeding shall be paid or reimbursed by the Partnership in
advance of the final disposition of the proceeding.

12.3 The indemnification provided by this Article XII shall be
in addition to any other rights to which an Indemnitee or any other Person
may be entitled under any agreement, pursuant to any vote of the Partners,
as a matter of law or otherwise, and shall continue as to an Indemnitee who
has ceased to serve in such capacity unless otherwise provided in a written
agreement pursuant to which such Indemnities are indemnified.

12.4 The Partnership may, but shall not be obligated to,
purchase and maintain insurance, on behalf of the Indemnitees and such
other Persons as the General Partner shall determine, against any liability
that may be asserted against or expenses that may be incurred by such
Person in connection with the Partnership's activities, regardless of
whether the Partnership would have the power to indemnify such Person
against such liability under the provisions of this Agreement.

12.5 In no event may an Indemnitee subject any of the Partners
to personal liability by reason of the indemnification provisions set forth
in this Agreement.

12.6 An Indemnitee shall not be denied indemnification in
whole or in part under this Article XII because the Indemnitee had an
interest in the transaction with respect to which the indemnification
applies if the transaction was otherwise permitted by the terms of this
Agreement.

12.7 The provisions of this Article XII are for the benefit of
the Indemnitees, their heirs, successors, assigns and administrators and
shall not be deemed to create any rights for the benefit of any other
Persons. Any amendment, modification or repeal of this Article XII or any
provision hereof shall be prospective only and shall not in any way affect
the Partnership's liability to any Indemnitee under this Article XII, as in
effect immediately prior to such amendment, modification, or repeal with
respect to claims arising from or relating to matters occurring, in whole
or in part, prior to such amendment, modification or repeal, regardless of
when such claims may arise or be asserted.

ARTICLE XIII

MISCELLANEOUS PROVISIONS

13.1 NOTICES. Notices hereunder shall be in writing and shall
be deemed to be delivered upon actual receipt or 72 hours following deposit
in a regularly maintained receptacle for the United States mail, registered
or certified mail, return receipt requested, with postage prepaid, and
addressed to the address of the addressee shown below, or to such other
address of which any party shall notify the other parties hereto, in
accordance with the terms hereof.

If to the General Partner:

237/1290 Upper Tier GP Corp.
c/o Victor Capital Group, L.P.
605 Third Avenue - 26th Floor
New York, New York 10016
Attn: John Klopp

with a copy to:

Battle Fowler LLP
75 East 55th Street
New York, New York 10022
Attn: Louis Vitali

If to the JMB Limited Partner or the Special General Partner:

900 North Michigan Avenue
19th Floor
Chicago, Illinois 60611
Attention: Stuart C. Nathan
Gary Nickele

13.2 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each to constitute an original, but all in the aggregate to
constitute one agreement as executed. This Agreement shall be binding upon
and inure to the benefit of the parties hereto, their heirs, legal
representatives, successors and permitted assigns.

13.3 NATURE OF PARTNERSHIP INTEREST. The interest of each
Partner in this Partnership is personal property.

13.4 INSOLVENCY PROCEEDINGS. No bankruptcy or insolvency
filing or proceeding in respect of the Partnership shall be made or
commenced without the consent of the General Partner, and the Partnership
shall not acquiesce, petition or otherwise invoke or cause any other person
and/or entity to invoke the process of the United States of America, any
state or other political subdivision thereof or any other jurisdiction, any
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government for the purpose of
commencing or sustaining a case against the Partnership under a federal or
state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of the Partnership or all or any part of its property or assets or
ordering the winding-up or liquidation of the affairs of the Partnership,
if such action has not been consented to by the General Partner.

13.5 TITLES AND CAPTIONS. All article or section titles or
captions in this Agreement are for convenience only. They shall not be
deemed part of this Agreement and in no way define, limit, extend or
describe the scope or intent of any provisions hereof. Except as
specifically provided otherwise, references to "Articles" and "Sections"
are to Articles and Sections of this Agreement.

13.6 PRONOUNS AND PLURALS. Whenever the context may require,
any pronoun used in this Agreement shall include the corresponding
masculine, feminine or neuter forms, and the singular form of nouns,
pronouns and verbs shall include the plural and vice versa.

13.7 FURTHER ACTION. The parties shall execute and deliver
all documents, provide all information and take or refrain from taking
action as may be necessary or appropriate to achieve the purposes of this
Agreement.

13.8 BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their heirs, executors,
administrators, successors, legal representatives and permitted assigns.

13.9 CREDITORS. Other than as expressly set forth herein with
respect to the Indemnitees, none of the provisions of this Agreement shall
be for the benefit of, or shall be enforceable by, any creditor of the
Partnership.

13.10 WAIVER. No failure by any party to insist upon the
strict performance of any covenant, duty, agreement or condition of this
Agreement or to exercise any right or remedy consequent upon a breach
thereof shall constitute waiver of any such breach or any other covenant,
duty, agreement or condition.

13.11 APPLICABLE LAW. This Agreement shall be construed and
enforced in accordance with and governed by the laws of the State of
Delaware, without regard to the principles of conflicts of laws thereof.

13.12 INVALIDITY OF PROVISIONS. If any provision of this
Agreement is or becomes invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions
contained herein shall not be affected thereby.

13.13 ENTIRE AGREEMENT. This Agreement contains the entire
understanding and agreement among the Partners with respect to the subject
matter hereof and supersedes any other prior written or oral understandings
or agreements among them with respect thereto.

<PAGE>

IN WITNESS WHEREOF, this Agreement is executed by the General
Partner, the Special General Partner and the JMB Limited Partner as of the
date first above written.

237/1290 UPPER TIER GP CORP.

By:
Name:
Title:

JMB/NYC OFFICE BUILDING ASSOCIATES, L.P., an
Illinois limited partnership

By: Carlyle Managers, Inc., its General
Partner

By:
Name:
Title:

CARLYLE MANAGERS, INC.

By:
Name:
Title:

Solely with respect to Section 7.6A:

METROPOLIS REALTY TRUST, INC.

By:
Name:
Title:

<PAGE>

Exhibit A

Entity Partnership Interest

237/1290 UPPER TIER GP CORP. 0.999%

JMB/NYC OFFICE BUILDING ASSOCIATES, L.P. 98.901%

CARLYLE MANAGERS, INC. 0.1%

EXHIBIT 10-AA
- -------------

INTERCREDITOR AGREEMENT

THIS INTERCREDITOR AGREEMENT (the "Agreement"), made as of the 19th
day of November, 1999, is among MICHIGAN AVENUE, L.L.C., a Delaware limited
liability company (hereinafter referred to as "Seller") having an office at
c/o JMB Property Management, Inc., 900 North Michigan Avenue, Suite 900,
Chicago, Illinois 60611, and each of the following: CARLYLE - XIII
ASSOCIATES, L.P., a Delaware limited partnership ("Carlyle XIII"); CARLYLE
- - XIV ASSOCIATES, L.P., a Delaware limited partnership ("Carlyle XIV"); and
PROPERTY PARTNERS, L.P., a Delaware limited partnership ("Property
Partners"; Carlyle XIII, Carlyle XIV and Property Partners are herein
sometimes each individually called a "Buyer" and collectively called the
"Buyers").

RECITALS

A. Seller is a participant in that certain Participation Agreement
("1996 Participation Agreement"), dated October 10, 1996, between
Metropolis Realty Trust, Inc. ("Metropolis"), a Maryland corporation, and
Seller. Pursuant to the 1996 Participation Agreement, Metropolis assigned
to Seller and Seller assumed from Metropolis an undivided participation
interest in (i) that certain Second Amended, Restated and Consolidated
Promissory Note, dated October 10, 1996, in the principal amount of
$88,572,780.00 made by JMB/NYC Office Building Associates, L.P., an
Illinois limited partnership ("JMB/NYC"), in favor of Metropolis (as it may
be hereafter amended, hereinafter referred to as the "Restated Note") and
(ii) that certain Second Amended, Restated and Consolidated Security
Agreement that secures the Restated Note, dated October 10, 1996
(hereinafter referred to as the "Restated Security Agreement"), such that
after such assignment Seller was the holder of 100% of the outstanding
principal balance and all interest accrued on the Restated Note except that
Metropolis retained the right to receive the first $750,000 paid under the
Restated Note.

B. A copy of the Restated Note is attached hereto as Exhibit A and
a copy of the Restated Security Agreement is attached hereto as Exhibit B.

C. The Restated Note and the Restated Security Agreement represent
consolidations of certain promissory notes (the "Existing Notes") and
security agreements (the "Existing Agreements") described in Exhibit C.

D. Seller desires to sell and assign to each Buyer, and each Buyer
desires to purchase from Seller, as set forth in the letter agreement among
Michigan Avenue, LLC, Carlyle Managers, Inc. and Carlyle Investors, Inc.,
dated September 27, 1999, an executed copy of which is attached hereto as
Exhibit D, an interest in the first $5,425,000 of accrued interest for book
purposes only (the "$5,425,000 Interest Amount"; i.e., this accrued
interest will not have been deducted for tax purposes by JMB/NYC; that is,
it will be the first $5,425,000 of interest which is owing immediately
after the accrual of any interest which has been deducted by JMB/NYC for
tax purposes) received by Seller on or after the date hereof pursuant to
its interest in the Restated Note and the Restated Security Agreement
(including any amounts Seller would otherwise receive pursuant to any
transfer by Metropolis of its existing participation interest in the 1996
Participation Agreement to Seller after the date hereof) on the terms and
conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, Seller and each Buyer
mutually agree as follows:

I. Definitions:

As used herein,

<PAGE>

"Percentage" shall mean:

(A) In the case of Carlyle XIII, 25%;

(B) In the case of Carlyle XIV, 50%; and

"Payout Date" means the date when each Buyer shall have received, in
cash or cash equivalents, such Buyers' Percentage of Tranche A.

"Tranche A" means the $5,425,000 Interest Amount received by Seller
on or after the date hereof pursuant to its interest in the Restated Note
and the Restated Security Agreement (including any amounts Seller would
otherwise receive pursuant to any transfer by Metropolis of its existing
participation interest in the 1996 Participation Agreement to Seller after
the date hereof) on the terms and conditions hereinafter set forth, and
whether made before or after the maturity or acceleration of the Restated
Note, and whether or not received as a result of enforcement of the
Restated Security Agreement or otherwise. For purposes of this Agreement,
Seller and Buyers will treat and consider the first $5,425,000 of accrued
interest paid on or after the date hereof under the Restated Note as
representing the $5,425,000 Interest Amount.

"Tranche B" means a subordinated interest in all amounts paid by or
received from or on behalf of JMB/NYC or its successors in respect of
Seller's interest in the Restated Note in each case paid or received on and
after the date hereof but after the Payout Date.

2. Sale of Senior Interests. In consideration for the payment by
each Buyer to the Seller of the amount (the "Purchase Price") set forth by
such Buyer's name below under the heading "Purchase Price", Seller hereby
sells and assigns to each Buyer, and each Buyer hereby purchases from
Seller, a senior interest (each, a "Tranche A Interest") in Seller's
interest (including any rights Seller might receive pursuant to any
transfer by Metropolis of its existing participation interest in the 1996
Participation Agreement to Seller after the date hereof) in the Restated
Note and the Restated Security Agreement in an amount equal to such Buyer's
Percentage of Tranche A. Seller shall, subject to the provisions of this
Agreement, retain a subordinated interest in the Restated Note and the
Restated Security Agreement. The Buyers' interest in Tranche A shall
entitle them as a group to receive the first $5,425,000 of accrued interest
paid on or after the date hereof under the Restated Note, which the Seller
and Buyers will consider to represent the $5,425,000 Interest Amount. The
respective interest of the Buyers in Tranche A shall be equal in priority
and no Buyer shall have priority over any other Buyer hereunder. All
payments made to the Buyers in respect of the Tranche A Interest shall be
made ratably according to their respective Percentages. The purchase
price to be paid by each Buyer to Seller in respect to such Buyer's
interest hereunder is as follows:

BUYER PURCHASE PRICE
----- --------------

Carlyle XIII $106,250
Carlyle XIV $212,500
Property Partners $106,250

Each Buyer shall pay to Seller, as payment for such Buyer's purchase
of its Tranche A Interest hereunder, the Purchase Price set forth above.

3. Interests. For purposes of allocating amounts between the
parties hereto, the interests of the parties herein shall be treated as
"stripped bonds" within the meaning of Section 1286 of the Internal Revenue
Code of 1986, as amended (the "Code").

<PAGE>

4. Subordination of Tranche B

(a) Tranche B Subordinate to Tranche A.

The Seller and each Buyer hereby agree, that, to the extent and
in the manner hereinafter set forth herein, the Seller's right to payment
in respect to the Restated Note and the Restated Security Agreement is
hereby expressly made subordinate and subject in right of payment to the
prior payment in full to each Buyer of its respective Percentage of
Tranche A.

(b) No Payment to Seller Prior to Payment in Full of Tranche A.

In the event that JMB/NYC shall make any payment to the Seller in
respect of the Restated Note or the Restated Security Agreement, such
payment shall be paid over and delivered forthwith by the Seller ratably to
the Buyers, to the extent necessary to pay in full each Buyer's Percentage
of Tranche A.

No payment made to or received by or on behalf of the Seller from or
on behalf of JMB/NYC in respect of the Restated Note or the Restated
Security Agreement may be retained by the Seller until each Buyer has
received in cash or cash equivalents such Buyer's Percentage of Tranche A.

In the event of (i) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to JMB/NYC or its creditors,
as such, or to its assets, or (ii) any liquidation, dissolution or other
winding up of JMB/NYC, whether voluntary or involuntary and whether or not
involving insolvency or bankruptcy, or (iii) any assignment for the benefit
of creditors or any other marshalling of assets and liabilities of JMB/NYC,
then and in any such event specified in (i), (ii) or (iii) above (each such
event, if any, herein sometimes referred to as a "Proceeding"), the Buyers
shall be entitled to receive payment in full of all amounts due or to
become due on or in respect of all their respective Percentages of Tranche
A, or provision shall be made for such payment in cash or cash equivalents
or otherwise in a manner satisfactory to each of the Buyers, before the
Seller shall be entitled to receive any payment on account of accrued
interest on the Restated Note, the Restated Security Agreement or Tranche B
or on account of purchase or redemption or other acquisition of the
Restated Note, the Restated Security Agreement or Tranche B by JMB/NYC or
any subsidiary of JMB/NYC, and to that end the Buyers shall be entitled to
receive, for application to the payment of their senior interests in
Tranche A, any payment or distribution of accrued interest, whether in
cash, property or securities which may be payable or deliverable in respect
of the Restated Note, the Restated Security Agreement or Tranche B in any
such Proceeding.

In the event that, notwithstanding the foregoing provisions of this
Section 4(c), the Seller shall have received any payment or distribution of
assets of JMB/NYC of any kind or character, in respect of the Restated
Note, the Restated Security Agreement or Tranche B, then and in such event
such payment or distribution shall be paid over or delivered forthwith to
the Buyers ratably for application to the payment of all their respective
Percentages of Tranche A remaining unpaid, to the extent necessary to pay
each of their respective interests in Tranche A in full, after giving
effect to any concurrent payment or distribution to or for the Buyers.

<PAGE>

(d) Provisions Solely to Define Relative Rights.

The provisions of this Section 4 are and are intended solely for the
purpose of defining the relative rights of Seller on the one hand and the
Buyers on the other hand. Nothing contained in this Section 4 or elsewhere
in this Agreement is intended to or shall impair the obligation of JMB/NYC
to pay the principal of (and premium, if any) and interest and other
amounts on the Restated Note and to perform its obligations under the
Restated Security Agreement as and when the same shall become due and
payable and performable in accordance with their respective terms.

(e) No Waiver of Subordination Provisions.

No right of any present or future Buyer to enforce the provisions in
respect of subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of JMB/NYC
or the Seller or by any act or failure to act, in good faith, by any such
Buyer, or by any noncompliance by the Seller with the terms, provisions and
covenants of this Agreement, regardless of any knowledge thereof any such
Buyer may have to be otherwise charged with.

5. Obligations of Seller.

(a) Seller shall, in its capacity as holder of its interest in the
Restated Note and Restated Security Agreement and until the Buyers' senior
interests in the Restated Note have been paid in full, (i) hold its
interest in the Restated Security Agreement and the collateral for the
Restated Note for the benefit of itself and the Buyers (each Buyer shall be
deemed to have a senior interest therein in proportion to its Percentage in
Tranche A), (ii) receive all payments of interest, principal and other sums
on account of or with respect to its interest in the Restated Note, and
(iii) promptly remit to each Buyer its share of interest received by Seller
on account of or with respect to such Buyer's percentage of Tranche A in
accordance with the provisions of this Agreement.

(b) Except as specifically provided to the contrary in this Section
5 or in Section 7 of this Agreement, until the Payout Date, Seller shall
not without the prior consent of each Buyer (i) agree to modify or amend
the interest rate provisions set forth in the Restated Note and Restated
Security Agreement, (ii) agree to extend the maturity date of the Restated
Note, other than in accordance with the express provisions of the Restated
Note and the Restated Security Agreement, (iii) agree to make or consent to
any materially adverse amendment to the Buyers, modification or waiver of
any of the terms, covenants, provisions or conditions of the Restated Note
and Restated Security Agreement, (iv) agree to waive, compromise or settle
any material claim under the Restated Note or the Restated Security
Agreement against JMB/NYC or for the observance and performance by JMB/NYC
of any of the terms, covenants, provisions and conditions of the Restated
Note and the Restated Security Agreement, or release the maker from any
material obligation or liability under the Restated Note and the Restated
Security Agreement, (v) waive any material default under the Restated Note
or the Restated Security Agreement, or (vi) release, reconvey or change in
any material respect, any collateral or security interest held under the
Restated Note and the Restated Security Agreement other than in accordance
with the express provisions of the Restated Note and the Restated Security
Agreement.

(c) Except as set forth in Section 5(b) above or as provided in
Section 7, Seller, in its capacity as holder of its interest in the
Restated Note, may, without obtaining the prior consent of any Buyer, (i)
extend for reasonable periods of time the time for the observance or
performance by JMB/NYC of the terms and conditions of the Restated Note and
the Restated Security Agreement, (ii) agree or consent to any non-material
amendment, modification or waiver of the terms, covenants, provisions or
conditions of the Restated Note and the Restated Security Agreement, (iii)
waive, compromise or settle any non-material claim under the Restated Note

<PAGE>

or the Restated Security Agreement against JMB/NYC under the Restated Note
or the Restated Security Agreement, or release JMB/NYC from any non-
material obligation or liability under the Restated Note and the Restated
Security Agreement, (iv) waive any non-material default under the Restated
Note and the Restated Security Agreement, (vi) release, reconvey or change,
in whole or in part, any collateral or security interest held under the
Restated Note and the Restated Security Agreement which is required to be
released or reconveyed in accordance with the express provisions of the
Restated Note and the Restated Security Agreement, and (vii) do or perform
any act or thing which in the reasonable judgment of Seller is necessary to
enable Seller to discharge and perform its duties under this Agreement or
which in the reasonable judgment of Seller is necessary or required to
preserve and protect the liens and security interests created by the
Restated Note and the Restated Security Agreement and the priority thereby
and the collateral for the Restated Note and the interest of Seller and the
Buyers therein. Each Buyer shall from time to time, upon request of
Seller, execute and deliver such documents and instruments as may be
reasonably necessary to enable Seller to effectively administer and service
its interest in the Restated Note in its capacity as holder of such
interest and in the manner contemplated by the provisions of this
Agreement.

(d) In giving or withholding its consent to any action or inaction
hereunder, or in taking or not taking any action hereunder, each Buyer may
act only in its own self interest and in its sole discretion and shall have
no obligation to consider the interests of the Seller or any other Buyer.

(e) Each Buyer hereby acknowledges that Seller has made no
representations or warranties with respect to the Restated Note and that
Seller shall have no responsibility for (i) the collectibility of the
Restated Note, (ii) the validity, enforceability or legal effect of the
Restated Note or the Restated Security Agreement, (iii) the validity,
sufficiency or effectiveness of the lien created or to be created by the
Restated Note and the Restated Security Agreement, or (iv) the financial
condition of JMB/NYC or the accuracy of any information supplied by or to
be supplied in connection with JMB/NYC or otherwise with respect to the
Restated Note or the collateral for the Restated Note. Each Buyer assumes
all risk of loss in connection with its undivided interest in Tranche A to
the full extent of its Percentage in such Tranche A. Seller assumes all
risk of loss in connection with its undivided interest in Tranche B to the
full extent of its interest in such Tranche B.

(f) Seller, in its capacity as holder of its interest in the
Restated Note, shall retain all rights under the Restated Note and Restated
Security Agreement with respect to enforcement, collection and
administration of the Restated Note and the security for the Restated Note,
which rights of Seller shall be subject to the provisions of this Section 5
and of Section 7 of this Agreement. At all times and until such time as
the Restated Note has been paid in full Seller shall act as the holder of
its interest in the Restated Note on behalf of itself and, prior to the
Payout Date, the Buyers, in accordance with the provisions of this
Agreement.

6. Expenses. Seller and the Buyers shall be responsible for
enforcement expenses and costs sustained or incurred in connection with the
Restated Note in proportion to the relative amounts of payments thereunder
received by such parties in accordance with their interests under this
Agreement.

7. Default by JMB/NYC. (a) Except as provided in Section 7(b)
below, if a default shall occur under the Restated Note or the Restated
Security Agreement, the decision of Seller shall control, which decision
may include the taking of any action not otherwise prohibited under this
Agreement. Seller shall, after Seller's having knowledge thereof, inform

<PAGE>

the Buyers of any material default under the Restated Note and/or the
Restated Security Agreement and of all material facts relating to such
default or relating to any other aspect which facts could or might have a
materially adverse effect on the value of the security for the Restated
Note or on the ability of JMB/NYC to perform its obligations under the
Restated Note and Restated Security Agreement.

(b) If a default shall occur under the Restated Note or the
Restated Security Agreement or if JMB/NYC has not repaid all amounts due
and owing under the Restated Note within one year after the Maturity Date
(as defined in the Restated Note), the Seller will take the appropriate
steps necessary to foreclose upon and obtain any partnership interests
owned by JMB/NYC that serve as collateral under the Restated Note in lieu
of seeking any other damages it may otherwise be entitled to receive.

8. Approval of Documents. Each Buyer has examined and approved
the Existing Notes, the Existing Security Agreements, the Restated Note and
the Restated Security Agreement and such other documents as such Buyer has
deemed necessary or appropriate.

9. Files and Records. Seller shall keep and maintain at its
offices, complete and accurate files and records of all matters pertaining
to the Restated Note and the Restated Security Agreement, which files and
records shall be available for inspection and copying by each Buyer and its
employees and agents, at their own expense, during normal business hours
upon reasonable prior notice to Seller.

10. Assignments and Subparticipations. Seller shall, subject to
the terms of this Section herein set forth, have the right after the date
of this Agreement to sell one or more additional interests in Seller's
retained interest in Tranche B to any person, party or investor selected by
Seller and on terms satisfactory to Seller. Without implying the necessity
therefor, each Buyer shall, upon request of Seller, and at Seller's
expense, enter into an amended and restated intercreditor agreement to
reflect any such additional interest in the Restated Note so sold and
assigned by Seller, which amended and restated intercreditor agreement
shall be identical to this Agreement other than for (i) modifications
necessary to reflect any such additional interest in the Restated Note so
sold and assigned by Seller, and (ii) modifications requested by the
purchaser of any such additional interest in the Restated Note and which
are of a nonmaterial nature or are generally more favorable to each Buyer.
Each Buyer shall have the right to assign or subparticipate its undivided
interest in Tranche A, in whole or in part, without the prior consent of
Seller or any other Buyer. If any Buyer shall subparticipate its interest
in the Restated Note in accordance with the provisions of this Section,
Seller shall not have any obligation to look to any person, party or entity
(including, without limitation, any such person, party or entity to whom
such Buyer has subparticipated its interest in the Restated Note in
accordance with the provisions of this Section) other than such Buyer for
the observance and performance by such Buyer of its obligations under this
Agreement.

11. Withholding Taxes. In the event Seller or JMB/NYC shall be
required by law to deduct and withhold Taxes (as hereinafter defined) from
interest, fees or other amounts payable to any Buyer with respect to the
Restated Note as a result of the Buyer constituting a Non-Exempt Person (as
hereinafter defined), Seller, in its capacity as holder of its interest,
shall be entitled to do so with respect to such Buyer's interest in such
payment (all withheld amounts being deemed paid to such Buyer), provided
Seller shall furnish such Buyer a statement setting forth the amount of
Taxes withheld, the applicable rate and other information which may
reasonably be requested for the purposes of assisting such Buyer to seek
any allowable credits or deductions for the Taxes so withheld in each
jurisdiction in which such Buyer is subject to tax. A "Non-Exempt Person"
is any "Person" (i.e., an individual, corporation, partnership, business
trust, trust, unincorporated association or other entity, or a governmental

<PAGE>

entity of any country) other than a Person who is either (i) a United
States Person (as defined under the Code) or (ii) has on file with Seller
for the year involved such duly executed form(s) or statements) which may,
from time to time, be prescribed by law and which, pursuant to applicable
provisions of (a) an income tax treaty between the United States and the
country of residence of such Person, (b) the Code and as such may hereafter
be amended, or (c) any applicable rules or regulations in effect under (a)
or (b) above, permit Seller to make such payments free of any obligation or
liability for withholding. For the purposes of this paragraph, "Taxes"
shall mean any income or other taxes, levies, imposts, duties, fees,
assessments or other charges of whatever nature, now or hereafter imposed
by any jurisdiction or by any department, agency, state or other political
subdivision thereof or therein. Each Buyer, severally and for itself
alone, agrees to indemnify Seller against and to hold Seller harmless from
any Taxes, interests, penalties and reasonable counsel fees arising from
any failure of Seller or JMB/NYC to withhold Taxes from payments made to
such Buyer in reliance upon any representation, certificate, statement,
document or instrument made or provided by such Buyer to Seller or JMB/NYC
in connection with the obligation of Seller or JMB/NYC to withhold Taxes
from payments made to such Buyer, it being expressly understood and agreed
that (i) Seller shall be absolutely and unconditionally entitled to accept
any such representation, certificate, statement, document or instrument as
being true and correct in all respects and to fully rely thereon without
any obligation or responsibility to investigate or to make any inquiries
with respect to the accuracy, veracity, conclusory correctness, or validity
of the same, and (ii) each Buyer upon request of Seller shall, at such
Buyer's sole cost and expense, defend any claim relating to the foregoing
indemnification obligations of such Buyer by counsel selected by such Buyer
and reasonably satisfactory to Seller. Each Buyer, severally and for
itself alone, represents to Seller that it is not a Non-Exempt Person and
that neither Seller or JMB/NYC is obligated under applicable law to
withhold Taxes on sums paid to it with respect to the Restated Note or
otherwise pursuant to this Agreement. Contemporaneously with the
execution of this Agreement, and from time to time as necessary during the
term of this Agreement, each Buyer shall deliver to Seller evidence
reasonably satisfactory to Seller substantiating that such Buyer is not a
Non-Exempt Person and that Seller is not obligated under applicable law to
withhold Taxes on sums paid to it with respect to the Restated Note or
otherwise.

12. Notices. Except as otherwise provided to the contrary herein,
any notice, request, demand, statement, authorization, direction, approval
or consent given or made hereunder shall be in writing and shall either be
hand delivered or sent by fax (with a duplicate copy being sent by another
form of delivery permitted hereunder), reputable courier service or
registered or certified mail, return receipt requested, and shall be deemed
given in the case of hand delivery, fax or reputable courier service when
delivered to or received at the following addresses, and in the case of
registered or certified mail three (3) business days after being postmarked
and addressed as follows:

If to the Seller:

Michigan Avenue, L.L.C.
c/o JMB Property Management, Inc.
900 North Michigan Avenue, Suite 900
Chicago, Illinois 60611
Attention: Gary Nickele
Telephone No.: (312) 915-1977
Fax No.: (312) 915-1275

If to Carlyle XIII:

900 North Michigan Avenue, Suite 1900
Chicago, Illinois 60611
Attention: Stuart C. Nathan
Telephone No.: (312) 915-1040
Fax No.: (312) 915-1043

<PAGE>

If to Carlyle XIV:

900 North Michigan Avenue, Suite 1900
Chicago, Illinois 60611
Attention: Stuart C. Nathan
Telephone No.: (312) 915-1040
Fax No.: (312) 915-1043

If to Property Partners:

900 North Michigan Avenue, Suite 1900
Chicago, Illinois 60611
Attention: Stuart Nathan
Telephone No.: (312) 915-1040
Fax No.: (312) 915-1043

Each party may designate a change of address, telephone number or fax
number by notice to the other parties given at least 15 days before such
change of address, telephone number or Fax number is to become effective.

13. Interests Not Securities or Loan. The respective interests in
the Restated Note sold by Seller to the Buyers shall not be deemed to be
(a) securities within the meaning of the Securities Act of 1933 or the
Securities Exchange Act of 1934 or (b) loans from any Buyer to the Seller
or from the Seller to any Buyer. No representations with respect to the
Existing Notes and the Restated Note or JMB/NYC have been made by Seller to
any Buyer except those, if any, contained herein. Each Buyer acknowledges
that the Restated Note is a non-recourse obligation of JMB/NYC and is
payable only to the extent of distributions made to JMB/NYC from certain
entities described in the Restated Security Agreement.

14. Parties' Intent. It is the intent and purpose of the parties
hereto that this Agreement represent a sale by Seller to each Buyer of a
senior interest in Seller's interest in the Restated Note and the Restated
Security Agreement in an amount equal to such Buyer's Percentage of Tranche
A and the rights, benefits and obligations arising therefrom. The parties
hereto do not intend to be and shall not be treated or considered joint
venturers or partners.

15. Captions. The titles and headings of the Sections of this
Agreement have been inserted for convenience of reference only and are not
intended to summarize or otherwise describe the subject matter of such
Sections and shall not be given any consideration in the construction of
this Agreement.

16. Counterparts. This Agreement may be executed in one or more
counterparts by some or all of the parties hereto, each of which
counterparts shall be an original and all of which together shall
constitute a single agreement.

17. Severability. If any term, covenant or provision of this
Agreement shall be held to be invalid, illegal or unenforceable in any
respect, this Agreement shall be construed without such term, covenant or
provision.

18. Modification. This Agreement constitutes the entire agreement
of the parties hereto with respect to the subject matter of this Agreement.

This Agreement shall not be modified, amended or terminated, except by an
agreement in writing signed by the parties hereto.

19. Due Execution.

(a) Seller and each Buyer respectively represents and warrants for
itself that this Agreement has been duly authorized, executed and delivered
by it and constitutes its legal, valid, binding and enforceable obligation
in accordance with its terms.

<PAGE>

(b) Seller represents and warrants to each Buyer that as of the
date on which such Buyer purchases such Tranche A Interest, Seller owns its
interest in the Restated Note free and clear of all liens and encumbrances,
and Seller has the right, power and authority to sell such interest to such
Buyer.

(c) Each Buyer hereby represents and warrants to Seller that the
purchase of the Tranche A Interest (i) is not prohibited under the laws and
regulations under which such Buyer is organized and operates, and (ii) is
made for such Buyer's own account and with no present intention of
disposing of the same.

20. Liability of Seller. Neither Seller nor any of its directors,
officers, agents or employees shall be liable to any Buyer for any action
taken or not taken by it in good faith in accordance with this Agreement or
with the consent or at the request of the requisite number of Buyers.
Seller shall not have any fiduciary duty to any Buyer hereunder. Seller
may rely upon any notice, consent, certificate, statement or other writing
believed by it in good faith to be genuine or to be signed by the proper
party or parties.

21. Payment Returns and Adjustments.

(a) If, as a result of a miscalculation or other mistake, Seller
disburses an amount to any Buyer that is less than or in excess of the
amount then due to such Buyer in respect of its interest in Tranche A,
then, promptly upon becoming aware of such discrepancy, Seller shall
disburse to such Buyer the amount of the deficiency or such Buyer shall
return to Seller the amount of the excess, as the case may be.

(b) If Seller determines at any time that any amount received or
collected by Seller in respect of the Restated Note must be returned to
JMB/NYC or paid to any other person or entity pursuant to any insolvency
law or otherwise, then, notwithstanding any other provision of this
Agreement, Seller shall not be required to distribute any portion thereof
to the Buyers and each Buyer shall promptly, on demand by Seller, repay any
portion thereof that Seller has distributed to such Buyer, together with
interest thereon at such rate and for such period, if any, as and in
respect of which Seller is required to pay interest to JMB/NYC or such
other person or entity.

22. Place and Manner of Payments. All payments pursuant hereto
shall be made by wire transfer of immediately available funds to such
account as any Buyer or Seller, as the case may be, may designate in
writing to the other from time to time.

23. GOVERNING LAW; SUBMISSION TO JURISDICTION.

(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE
LAWS OF THE STATE OF ILLINOIS.

(b) SELLER AND EACH BUYER HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY ILLINOIS STATE OR FEDERAL COURT SITTING IN CHICAGO,
ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION
OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH ILLINOIS STATE OR FEDERAL
COURT. EACH PARTY TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT
FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

24. Successors and Assigns. This Agreement and all its provisions
shall be binding upon and inure to the benefit of the parties and their
respective legal representatives, successors, and permitted assigns, and
shall not benefit any person or entity other than those enumerated above.

<PAGE>

25. Entire Agreement. This Agreement constitutes the entire
agreement between the parties, integrates all the terms and conditions
mentioned herein or incidental hereto, and supersedes all oral negotiations
and prior writings with respect to the subject matter hereof, including,
without limitation, any summary of terms and conditions, information
memorandum, presentation, financial statement or any other communication.

26. WAIVER OF JURY TRIAL. SELLER AND EACH BUYER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER,
OR IN CONNECTION WITH THIS AGREEMENT, THE RESTATED NOTE, ANY RELATED
DOCUMENTS AND AGREEMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING OR
STATEMENTS (WHETHER VERBAL OR WRITTEN).

<PAGE>

IN WITNESS WHEREOF, Seller and each Buyer have caused this Agreement
to be duly executed as of the day and year first above written.

MICHIGAN AVENUE, L.L.C.

By: JMB Property Managers, Inc.,
Managing Member

By: ___________________________________
Name: Gary Nickele
Title: Vice President

CARLYLE - XIII ASSOCIATES, L.P.

By: Carlyle Investors, Inc., General Partner

By: ___________________________________
Name: Stuart C. Nathan
Title: President

CARLYLE - XIV ASSOCIATES, L.P.

By: Carlyle Investors, Inc., General Partner

By: ___________________________________
Name: Stuart C. Nathan
Title: President

PROPERTY PARTNERS, L.P.,

By: Carlyle Investors, Inc., General Partner

By: ___________________________________
Name: Stuart C. Nathan
Title: President

<PAGE>

Exhibit A

<PAGE>

Exhibit B

<PAGE>

Exhibit C

<PAGE>

Exhibit D

EXHIBIT 21

LIST OF SUBSIDIARIES

The Partnership is a 25% shareholder in Carlyle Managers, Inc., the
general Partner of JMB/NYC Office Building Associates, L.P. ("JMB/NYC") and
25% shareholder in Carlyle Investors, Inc., which is the general partner of
Carlyle-XIII Associates, L.P. The Partnership is a 99% limited partner in
Carlyle-XIII Associates, L.P., which holds an approximate 25% limited
partnership interest in JMB/NYC. JMB/NYC is a 99% limited partner in Upper
Tier Associates, L.P. Reference is made to the Notes for a description of
the terms of such joint venture partnerships.

EXHIBIT 24

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned officers of JMB
Realty Corporation, the corporate general partner of CARLYLE REAL ESTATE
LIMITED PARTNERSHIP - XIII, do hereby nominate, constitute and appoint GARY
NICKELE, GAILEN J. HULL, DENNIS M. QUINN or any of them, attorneys and
agents of the undersigned with full power of authority to sign in the name
and on behalf of the undersigned officers a Report on Form 10-K of said
partnership for the fiscal year ended December 31, 1999, and any and all
amendments thereto, hereby ratifying and confirming all that said attorneys
and agents and any of them may do by virtue hereof.

IN WITNESS WHEREOF, the undersigned have executed this Power of
Attorney the 31st day of January, 2000.

H. RIGEL BARBER
- -----------------------
H. Rigel Barber Chief Executive Officer

The undersigned hereby acknowledge and accept such power of authority
to sign, in the name and on behalf of the above named officers, a Report on
Form 10-K of said partnership for the fiscal year ended December 31, 1999,
and any and all amendments thereto, the 31st day of January, 2000.

GARY NICKELE
-----------------------
Gary Nickele

GAILEN J. HULL
-----------------------
Gailen J. Hull

DENNIS M. QUINN
-----------------------
Dennis M. Quinn

<PAGE>

EXHIBIT 24

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned officers and/or
directors of JMB Realty Corporation, the corporate general partner of
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII, do hereby nominate,
constitute and appoint GARY NICKELE, GAILEN J. HULL, DENNIS M. QUINN or any
of them, attorneys and agents of the undersigned with full power of
authority to sign in the name and on behalf of the undersigned officer or
directors a Report on Form 10-K of said partnership for the fiscal year
ended December 31, 1999, and any and all amendments thereto, hereby
ratifying and confirming all that said attorneys and agents and any of them
may do by virtue hereof.

IN WITNESS WHEREOF, the undersigned have executed this Power of
Attorney the 31st day of January, 2000.

NEIL G. BLUHM
- ----------------------- President and Director
Neil G. Bluhm

JUDD D. MALKIN
- ----------------------- Chairman and Chief Financial Officer
Judd D. Malkin

A. LEE SACKS
- ----------------------- Director of General Partner
A. Lee Sacks

STUART C. NATHAN
- ----------------------- Executive Vice President
Stuart C. Nathan Director of General Partner

The undersigned hereby acknowledge and accept such power of authority
to sign, in the name and on behalf of the above named officers and/or
directors, a Report on Form 10-K of said partnership for the fiscal year
ended December 31, 1999, and any and all amendments thereto, the 31st day
of January, 2000.

GARY NICKELE
-----------------------
Gary Nickele

GAILEN J. HULL
-----------------------
Gailen J. Hull

DENNIS M. QUINN
-----------------------
Dennis M. Quinn

<ARTICLE> 5

<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1999 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999

<CASH> 2,523,388
<SECURITIES> 0
<RECEIVABLES> 41,300
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,564,688
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,669,876
<CURRENT-LIABILITIES> 100,988
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> (318,157)
<TOTAL-LIABILITY-AND-EQUITY> 2,669,876
<SALES> 0
<TOTAL-REVENUES> 300,152
<CGS> 0
<TOTAL-COSTS> 12,196
<OTHER-EXPENSES> 560,180
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 233,008
<INCOME-PRETAX> (505,232)
<INCOME-TAX> 0
<INCOME-CONTINUING> 2,286,026
<DISCONTINUED> 980,945
<EXTRAORDINARY> (1,121,200)
<CHANGES> 0
<NET-INCOME> 2,145,771
<EPS-BASIC> 5.63
<EPS-DILUTED> 5.63

</TABLE>