BALCOR PENSION INVESTORS VI
8-K, 1996-07-26
REAL ESTATE
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                      SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, DC  20549

                                   FORM 8-K

                                CURRENT REPORT

                    PURSUANT TO SECTION 13 OR 15 (d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

        Date of Report (date of earliest event reported)  June 28, 1996

                         BALCOR PENSION INVESTORS - VI
         ------------------------------------------------------------
                           Exact Name of Registrant


Illinois                                0-14332
- -------------------------------         ---------------------------------
State or other jurisdiction             Commission file number

2355 Waukegan Road
Suite A200
Bannockburn, Illinois                   36-3319330
- -------------------------------         ---------------------------------
Address of principal                    I.R.S. Employer
executive offices                       Identification
                                        Number

60015
- -------------------------------
Zip Code


              Registrant's telephone number, including area code:
                                (847) 267-1600
<PAGE>
ITEM 5. OTHER INFORMATION
- ----------------------------------------------------------------------

a) Sand Pebble Village I Apartments

In April 1987, the Partnership and an affiliate funded a $22,400,000 first
mortgage loan collateralized by the Sand Pebble Village I Apartments ("Sand
Pebble I"), Riverside, California.  The amount advanced by the Partnership
towards the loan was $10,000,000.  In July 1992, a joint venture ("Joint
Venture") consisting of the Partnership and the affiliate obtained title to the
property through foreclosure.

On June 28, 1996, the Joint Venture contracted to sell the property for a  sale
price of $19,411,765 to an unaffiliated party, RREEF America L.L.C., a Delaware
limited liability company.  The purchaser has deposited $150,000 into an escrow
account as earnest  money and will  pay the remaining  $19,261,765 at  closing,
which is scheduled  for August 1,  1996.  From  the proceeds of  the sale,  the
Joint Venture  will  pay $242,647  to  an  unaffiliated party  as  a  brokerage
commission and a fee of $145,588 to  an affiliate of the third party  providing
property  management  services  for  the  property  for  services  rendered  in
connection with  the  sale.   The  Joint  Venture will  receive  the  remaining
proceeds of $19,023,530, less  closing costs, which  will be distributed  among
the Partnership  and  the  affiliate in  accordance  with  their  participating
percentages in  the Joint  Venture.   The Partnership  is expected  to  receive
approximately $8,493,000.  Neither the  General Partner nor any affiliate  will
receive a brokerage  commission in connection  with the sale  of the  property.
The General Partner will be reimbursed by the Joint Venture for actual expenses
incurred in connection with the sale.

The Partnership and  the affiliate,   through another joint  venture, own  Sand
Pebble Village  II Apartments  ("Sand  Pebble II"),  located adjacent  to  Sand
Pebble I, and  have simultaneously  contracted to sell  Sand Pebble  II to  the
purchaser, as described elsewhere in this Report.  If the purchaser terminates 
this or the agreement of sale for Sand Pebble II for any  reason, the other 
agreement of sale  will also be deemed terminated.

The closing is subject to the satisfaction of numerous terms and conditions,
including the closing of the sale of Sand Pebble II.  There can be no assurance
that all of the terms and conditions will be complied with and, therefore, it
is possible the sale of the property may not occur.

b) Sand Pebble Village II Apartments

In October 1993, a joint venture ("Joint Venture") consisting of the
Partnership and an affiliate purchased Sand Pebble Village II Apartments ("Sand
Pebble II"), Riverside, California for a purchase price of $9,300,000. The
property was acquired subject to first mortgage financing of $5,000,000. The
amount advanced by the Joint Venture towards the purchase of Sand Pebble II was
$4,300,000, of which the Partnership's share was $1,191,520.
<PAGE>
On June 28, 1996,  the Joint Venture  contracted to sell Sand  Pebble II for  a
sale price of  $12,088,235 to an  unaffiliated party, RREEF  America L.L.C.,  a
Delaware limited liability company.  The purchaser has deposited $150,000  into
an escrow account as  earnest money and will  pay the remaining $11,938,235  at
closing, which is scheduled for August 1, 1996. From the proceeds of the  sale,
the Joint Venture will repay the first mortgage loan which is expected to  have
an outstanding balance of $4,859,155 at closing, and $151,103 to a third  party
as a brokerage commission.  An affiliate of the third party providing  property
management services for the property will receive a fee of $90,662 for services 
rendered in connection with  the sale.  The Joint  Venture will  receive the 
remaining proceeds of  approximately  $6,987,315,  less  closing  costs,  
which  will  be distributed among the Partnership  and the affiliate  in 
accordance with  their participating percentages in the Joint Venture.  The 
Partnership is expected to receive  approximately  $3,116,342.    Neither  
the  General  Partner  nor  any affiliate will receive a  brokerage 
commission in connection  with the sale  of the property.  The General Partner 
will be reimbursed by the Joint Venture  for actual expenses incurred in 
connection with the sale.

The Partnership and  the affiliate, through another joint venture, own
Sand  Pebble  Village  I  Apartments  ("Sand  Pebble  I"), located adjacent 
to Sand Pebble II, and have simultaneously contracted to sell Sand  Pebble I 
to the  purchaser, as described elsewhere in this Report.  If  the purchaser 
terminates  this or the  agreement of sale  for Sand Pebble I for any reason, 
the other agreement of sale will also be deemed terminated.

The closing is subject  to the satisfaction of  numerous terms and  conditions,
including the closing of the sale of Sand Pebble I.  There can be no  assurance
that all of the terms and conditions  will be complied with and, therefore,  it
is possible the sale of the property may not occur.

c)  Woodscape Apartments

In  1985,  the  Partnership  funded  a  $3,512,651  loan  collateralized  by  a
wrap-around mortgage on  Woodscape Apartments,  Raleigh, North  Carolina.   The
Partnership subsequently advanced  an additional  $125,000 pursuant  to a  loan
modification.  The Partnership took  title to the property through  foreclosure
in 1992 subject to the  first mortgage loan.   In 1994, the Partnership  repaid
the first  mortgage loan  in the  amount of  $3,387,000 and  paid a  prepayment
penalty of $102,000.

On July 15, 1996, the  Partnership contracted to sell  the property for a  sale
price  of  $9,550,000   to  an  unaffiliated   party,  ERP  Operating   Limited
Partnership, an  Illinois  limited  partnership. The  purchaser  has  deposited
$300,000 into an  escrow account as  earnest money. The  remainder of the  sale
price will be payable in cash at closing, scheduled for August 30, 1996.   From
the proceeds of the sale, the Partnership will pay $167,125 to a third party as
a brokerage commission, and an affiliate of the third party providing  property
management services for the property will  receive a fee for services  rendered
in connection with the sale of the  property of $95,500.  The Partnership  will
receive the remaining proceeds of approximately $9,287,375, less closing costs.
Of such  proceeds, an amount not to exceed $500,000 will  be retained by the 
Partnership and  will not be available  for use  or distribution by  the 
Partnership  until 120  days after the closing.  Neither the General Partner 
nor any affiliate will  receive a brokerage commission in connection with the 
sale of the property. The General Partner will be reimbursed by the 
Partnership for its actual expenses  incurred in connection with the sale.
<PAGE>
Affiliates of the General Partner have  recently sold or contracted to sell  24
other properties to the purchaser.  

The closing is subject  to the satisfaction of  numerous terms and  conditions.
There can be no assurance that all of the terms and conditions will be complied
with and, therefore, it is possible the sale of the property may not occur.


ITEM 7.  FINANCIAL STATEMENTS AND EXHIBITS
- ----------------------------------------------------------------------

     (a)  FINANCIAL STATEMENTS AND EXHIBITS:

            None

     (B)  PRO FORMA FINANCIAL INFORMATION:

            None

     (C)  EXHIBITS:

          (99) (a)  Agreement of Sale and attachment thereto relating to the 
                    sale of Sand Pebble Village I Apartments, Riverside, 
                    California.

               (b)  Agreement of Sale and attachment thereto relating to the 
                    sale of Sand Pebble Village II Apartments, Riverside, 
                    California.

               (c)  Agreement of Sale and Letter Agreement thereto relating
                    to the sale of Woodscape Apartments, Raleigh, North
                    Carolina.

     No information is required under Items 1, 2, 3, 4, 6 and 8 and these items
have, therefore, been omitted.
<PAGE>
Signature
- -------------

     Pursuant to the  requirements of the Securities Exchange Act of 1934,  the
Registrant has  duly caused  this Report  to be  signed on  its behalf  by  the
undersigned hereunto duly authorized.


                         BALCOR PENSION  INVESTORS-VI

                         By:  Balcor Mortgage Advisors-VI, an 
                              Illinois general partnership, its 
                              general partner

                         By:  The Balcor Company,
                              a Delaware corporation,
                              a partner

                         By:  /s/ Jerry M. Ogle
                              ------------------------------------
                                  Jerry M. Ogle, Vice President 
                                  and Secretary

Dated:  July 26, 1996
<PAGE>

                               AGREEMENT OF SALE


     THIS AGREEMENT OF SALE (this "Agreement"), is entered into as of the 28th
day of June 1996, by and between RREEF AMERICA L.L.C., a Delaware limited
liability company ("Purchaser"), and PEBBLE SAND LIMITED PARTNERSHIP, an
Illinois limited partnership ("Seller").

                             W I T N E S S E T H:

1.   PURCHASE AND SALE.  Purchaser agrees to purchase and Seller agrees to sell
at the price of Nineteen Million Four Hundred Eleven Thousand Seven Hundred
Sixty-Five And No/100 Dollars ($19,411,765.00) (the "Purchase Price"), that
certain property commonly known as Sand Pebble Village I Apartments, Riverside,
California, legally described on Exhibit A attached hereto (the "Property").
Included in the Purchase Price is all of the personal property set forth on
Exhibit B attached hereto (the "Personal Property"), all of the buildings
located on the Property, all right, title and interest of Seller, if any, in
and to (a) all open or proposed highways, streets, roads, avenues, alleys,
easements, strips, gores and rights-of-way in, on, across, in front of,
contiguous to, abutting or adjoining the Property, (b) the name "Sand Pebble
Village I Apartments", (c) all plans and specifications, (c) all transferable
licenses, permits, guaranties and warranties relating to the zoning, land use,
ownership, operation, occupancy, construction or maintenance of the Premises
and buildings thereon, (d) all fixtures, equipment and supplies owned by Seller
located on the Property, and (e) all Leases (hereinafter defined), rights and
privileges of Seller pertaining to the Property.

2.   PURCHASE PRICE.  The Purchase Price shall be paid by Purchaser as follows:

     2.1.  No later than one business day following the execution of this
Agreement by both parties, the sum of One Hundred Fifty Thousand and No/100
Dollars ($150,000.00) (the "Earnest Money") to be held in escrow by and in
accordance with the provisions of the Escrow Agreement ("Escrow Agreement")
attached hereto as Exhibit C; and

     2.2.  On the "Closing Date" (hereinafter defined), the balance of the
Purchase Price, adjusted in accordance with the prorations, by federally wired
"immediately available" funds, on or before 11:00 a.m Chicago time.

3.   TITLE COMMITMENT AND SURVEY.

     3.1.  Seller has ordered, and will deliver to Purchaser promptly following
Seller's receipt of a title commitment for an owner's standard title insurance
policy issued by an agent for Lawyer's Title Insurance Corporation (hereinafter
referred to as "Title Insurer") for the Property (the "Title Commitment").  The
Title Commitment shall be conclusive evidence of good title as therein shown as
to all matters to be insured by the title policy, subject only to the
exceptions therein stated.  On the Closing Date, Title Insurer shall deliver to
Purchaser a standard title policy in conformance with the previously delivered
Title Commitment, subject to Permitted Exceptions and Unpermitted Exceptions
(as said terms are defined below) waived by Purchaser (the "Title Policy").
Seller and Purchaser shall each pay for one-half of the costs of the Title
Commitment and Title Policy and Purchaser shall pay for the cost of any
endorsements (other than endorsements obtained by Seller in order to insure
over Unpermitted Exceptions) to, or extended coverage on, the Title Policy.
<PAGE>
     3.2.  Seller has ordered, and will deliver to Purchaser promptly following
Seller's receipt of a survey of the Property (the "Survey").  Seller and
Purchaser shall each pay for one-half of the costs of the Survey.  The Survey
shall be made in accordance with Purchaser's survey standards furnished to
Seller.

     3.3. The obligation of Purchaser to pay various costs set forth in
Paragraphs 3.1 and 3.2 shall survive the termination of this Agreement.

     3.4. On or before the later to occur of (a) July 11, 1996; or (b) five (5)
business days following Purchaser's receipt of the Title Commitment, the
Schedule B documents referenced in the Title Commitment, and the Survey (the
"Title/Survey Review Deadline Date"), Purchaser shall advise Seller in writing
if any exceptions to title shown on the Title Commitment are disapproved by
Purchaser or any matters on the Survey are unacceptable to Purchaser.  If
Purchaser does not so advise Seller on or before the Title/Survey Review
Deadline Date, all exceptions to title shown on the Title Commitment shall be
deemed Permitted Exceptions and all matters shown on the Survey shall be deemed
acceptable to Purchaser.  For purposes of this Agreement, "Permitted
Exceptions" shall mean: (a) general real estate taxes, association assessments,
special assessments, special district taxes and related charges not yet due and
payable; (b) matters shown on the Survey not disapproved by Purchaser in
writing as provided above; (c) matters caused by the actions of Purchaser; and
(d) the title exceptions set forth in the Title Commitment not disapproved in
writing by Purchaser as provided above, to the extent that same affect the
Property.  Purchaser agrees to use diligent efforts to cause the Title Insurer
to remove the general printed exceptions contained in the standard title policy
to be issued by Title Insurer, including, without limitation, paying the cost
thereof, and Seller agrees to execute standard Lawyer's Title "ALTA" statements
in the form customarily used in California in order to assist Purchaser in
obtaining extended coverage but shall not be obligated to incur any cost or
liability (other than on account of the ALTA statement) in providing such
assistance.  If Purchaser fails to use such diligent efforts, the general
printed exceptions will constitute Permitted Exceptions.  All exceptions to
title other than those described above in this Paragraph shall be referred to
as "Unpermitted Exceptions".  With respect to Unpermitted Exceptions for liens
and encumbrances of a definite or ascertainable amount securing borrowed money,
mechanics liens or for unpaid real estate taxes and assessments ("Monetary
Unpermitted Exceptions"), the indebtedness giving rise to such Monetary
Unpermitted Exceptions will be paid at the Closing and the lien thereby
released and removed.  Seller's obligations under the preceding sentence shall
be limited to Monetary Unpermitted Exceptions arising out of an affirmative
action of Seller (such as execution of a mortgage, entering into a contract for
construction work on the Property or non-payment of real estate taxes).  Any
Unpermitted Exceptions to title which are insured over by the Title Insurer and
reasonably approved as such by Purchaser, as provided herein, shall be deemed
Permitted Exceptions.  If Seller fails to have any Unpermitted Exceptions
(other than a Monetary Unpermitted Exception) removed or insured over prior to
ten (10) business days following the Title/Survey Review Deadline Date (the
"Seller Response Date"), Purchaser may elect, by written notice to Seller given
within five (5) business days following the Seller Response Date, (i) to accept
title as it then is (in which case such exceptions shall be deemed "Permitted
Exceptions"), or (ii) to terminate this Agreement, in which case this Agreement
shall become null and void without further action of the parties and all
Earnest Money theretofore deposited into the escrow by Purchaser together with
any interest accrued thereon, shall be returned to Purchaser, and neither party
shall have any further liability to the other, except for Purchaser's
<PAGE>
obligation to indemnify Seller and restore the Property, as more fully set
forth in Paragraph 7.  Purchaser shall have the right to pay Monetary
Unpermitted Exceptions at Closing, if Seller fails to do so, at no liability or
cost to Seller and no adjustment to the Purchase Price. 

4.   PAYMENT OF CLOSING COSTS.

     In addition to the costs set forth in Paragraphs 3.1 and 3.2, Purchaser
and Seller shall each pay for one-half of the costs of the documentary or
transfer stamps to be paid with reference to the "Deed" (hereinafter defined)
and all other stamps, intangible, transfer, documentary, recording, sales tax
and surtax imposed by law with reference to any other sale documents delivered
in connection with the sale of the Property to Purchaser and all other charges
of the Title Insurer in connection with this transaction.  Purchaser shall not
be required to incur title charges or escrow fees on account of using Charter
Title Company which exceed those that would normally be charged by the Title
Insurer. 

5.   CONDITION OF TITLE.

     5.1.  If, prior to "Closing" (as hereinafter defined), a date-down to the
Title Commitment discloses any new Unpermitted Exception, Seller shall have
thirty (30) days from the date of Purchaser's notification to Seller of such
new Unpermitted Exception (which will be given by Purchaser, if at all, not
later than five (5) business days after Purchaser's receipt of the date-down to
the Title Commitment), at Seller's expense, to (i) bond over with a bonding
company reasonably satisfactory to Purchaser, cure and/or have any Unpermitted
Exceptions which, in the aggregate, do not exceed $25,000.00, removed from the
Title Commitment or to have the Title Insurer commit to insure against loss or
damage that may be occasioned by such Unpermitted Exceptions on the condition
that the form of endorsement shall be reasonably satisfactory to Purchaser, or
(ii) have the right, but not the obligation, to bond over (with a bonding
company reasonably satisfactory to Purchaser), cure and/or have any Unpermitted
Exceptions which, in the aggregate, equal or exceed $25,000.00, removed from
the Title Commitment or to have the Title Insurer commit to insure against loss
or damage that may be occasioned by such Unpermitted Exceptions on the
condition that the form of endorsement shall be reasonably satisfactory to
Purchaser.  In such event, the time of Closing shall be delayed, if necessary,
to give effect to said aforementioned time periods.  If Seller fails to cure or
have said Unpermitted Exception removed or have the Title Insurer commit to
insure as specified above within said thirty (30) day period or if Seller
elects not to exercise its rights under (ii) in the preceding sentence,
Purchaser may terminate this Agreement upon notice to Seller within five (5)
days after the expiration of said thirty (30) day period.  Absent notice from
Purchaser to Seller in accordance with the preceding sentence, Purchaser shall
be deemed to have elected to take title subject to said Unpermitted Exception.
Purchaser may, at Purchaser's sole cost and expense, and without any liability
to Seller, bond over any Unpermitted Exception.  If Purchaser terminates this
Agreement in accordance with the terms of this Paragraph 5.1, this Agreement
shall become null and void without further action of the parties and all
Earnest Money theretofore deposited into the escrow by Purchaser together with
any interest accrued thereon, shall be returned to Purchaser, and neither party
shall have any further liability to the other, except for Purchaser's
obligation to indemnify Seller and restore the Property, as more fully set
forth in Paragraph 7.
<PAGE>
     5.2.  Seller agrees to convey fee simple title to the Property to
Purchaser by grant deed (the "Deed") in recordable form subject only to the
Permitted Exceptions and any Unpermitted Exceptions waived by Purchaser.

     5.3. Seller agrees that if a special assessment is enacted prior to the
Closing Date, notwithstanding Section 3.4(a), Purchaser shall have the right to
terminate this Agreement by written notice to Seller within five (5) days after
Purchaser has actual notice of such enactment.

6.   CONDEMNATION, EMINENT DOMAIN, DAMAGE AND CASUALTY.

     6.1.  Except as provided in the indemnity provisions contained in
Paragraph 7.1 of this Agreement, Seller shall bear all risk of loss with
respect to the Property up to the earlier of the dates upon which either
possession or title is transferred to Purchaser in accordance with this
Agreement.  Notwithstanding the foregoing, in the event of damage to the
Property by fire or other casualty prior to the Closing Date, repair of which
would cost less than or equal to $100,000.00 (as determined by Seller in good
faith) Purchaser shall not have the right to terminate its obligations under
this Agreement by reason thereof, but Seller shall have the right to elect to
either repair and restore the Property to Purchaser's reasonable satisfaction
(in which case the Closing Date shall be extended until completion of such
restoration, which restoring shall be pursued diligently) or to assign and
transfer to Purchaser on the Closing Date all of Seller's right, title and
interest in and to all insurance proceeds paid or payable to Seller on account
of such fire or casualty, and Seller shall pay to Purchaser at the Closing the
amount of Seller's insurance deductible.  Seller shall promptly notify
Purchaser in writing of any such fire or other casualty and Seller's
determination of the cost to repair the damage caused thereby.  In the event of
damage to the Property by fire or other casualty prior to the Closing Date,
repair of which would cost in excess of $100,000.00 (as determined by Seller in
good faith), then this Agreement may be terminated at the option of Purchaser,
which option shall be exercised, if at all, by Purchaser's written notice
thereof to Seller within five (5) business days after Purchaser receives
written notice of such fire or other casualty and Seller's determination of the
amount of such damages, and upon the exercise of such option by Purchaser this
Agreement shall become null and void, the Earnest Money deposited by Purchaser
shall be returned to Purchaser together with interest thereon, and neither
party shall have any further liability or obligations hereunder.  In the event
that Purchaser does not exercise the option set forth in the preceding
sentence, the Closing shall take place on the Closing Date and Seller shall
assign and transfer to Purchaser on the Closing Date all of Seller's right,
title and interest in and to all insurance proceeds paid or payable to Seller
on account of the fire or casualty, and Seller shall pay to Purchaser at the
Closing the amount of Seller's insurance deductible.

     6.2.  If between the date of this Agreement and the Closing Date, any
condemnation or eminent domain proceedings are initiated or threatened by a
notice to Seller from a governmental authority which might result in the taking
of any part of the Property or the taking or closing of any right of access to
the Property, Seller shall immediately notify Purchaser of such occurrence.  In
the event that the taking of any part of the Property shall: (i) materially
impair access to the Property; (ii) cause any material non-compliance with any
applicable law, ordinance, rule or regulation of any federal, state or local
authority or governmental agencies having jurisdiction over the Property or any
portion thereof or cause the property to be a non-conforming use or structure;
(iii) materially and adversely impair the use of the Property as it is
<PAGE>
currently being operated, or (iv) result in the loss of a portion of a
building, parking spaces or improvements constituting an amenity (hereinafter
collectively referred to as a "Material Event"), Purchaser may:

          6.2.1.  terminate this Agreement by written notice to Seller, in
which event the Earnest Money deposited by Purchaser, together with interest
thereon, shall be returned to Purchaser and all rights and obligations of the
parties hereunder with respect to the closing of this transaction will cease;
or

          6.2.2.  proceed with the Closing, in which event Seller shall assign
to Purchaser all of Seller's right, title and interest in and to any award made
in connection with such condemnation or eminent domain proceedings.

     6.3. Purchaser shall then notify Seller, within five (5) business days
after Purchaser's receipt of Seller's notice, whether Purchaser elects to
exercise its rights under Paragraph 6.2.1 or Paragraph 6.2.2.  Closing shall be
delayed, if necessary, until Purchaser makes such election.  If Purchaser fails
to make an election within such five (5) business day period, Purchaser shall
be deemed to have elected to exercise its rights under Paragraph 6.2.2.  If
between the date of this Agreement and the Closing Date, any condemnation or
eminent domain proceedings are initiated which do not constitute a Material
Event, Purchaser shall be required to proceed with the Closing, in which event
Seller shall assign to Purchaser all of Seller's right, title and interest in
and to any award made in connection with such condemnation or eminent domain
proceedings.

7.   INSPECTION AND AS-IS CONDITION.

     7.1.  During the period commencing on June 17, 1996 and ending at 5:00
p.m. Chicago time on July 17, 1996 (said period being herein referred to as the
"Inspection Period"), Purchaser and the agents, engineers, employees,
contractors and surveyors retained by Purchaser may enter upon the Property, at
any reasonable time and upon reasonable prior notice to Seller, to inspect the
Property, including a review of leases located at the Property, and to conduct
and prepare such studies, tests and surveys as Purchaser may deem reasonably
necessary and appropriate.  In connection with Purchaser's review of the
Property, Seller agrees to deliver to Purchaser copies of the current rent roll
for the Property, the current delinquency report for the Property, the most
recent real estate tax and insurance bills, utility account numbers, service
contracts, and unaudited year end 1995 and year-to-date (through April 30,
1996) operating statements. 

     All of the foregoing tests, investigations and studies to be conducted
under this Paragraph 7.1 by Purchaser shall be at Purchaser's sole cost and
expense, and if as a result of Purchaser's investigations and inspections of
the Property there is damage or injury to persons or property, Purchaser shall
restore the Property to the condition existing prior to the performance of such
tests or investigations by or on behalf of Purchaser.  Purchaser shall not
allow or permit any liens or encumbrances to arise or exist against the
Property or any part thereof as a result of its inspections.  Purchaser shall
defend, protect, indemnify and hold Seller and any affiliate, parent of Seller,
and all shareholders, employees, officers and directors of Seller or Seller's
affiliate or parent (hereinafter collectively referred to as "Affiliate of
Seller") harmless from any and all actual loss, liability or damages (including
without limitation, reasonable attorney's fees, court costs and costs of appeal
but excluding consequential damages) suffered or incurred by Seller or
<PAGE>
Affiliates of Seller for injury to persons or property caused by Purchaser or
Purchaser's agents entry on the Property in the course of performing any test
or inspection on the Property, including, without limitation, mechanics liens,
provided that Purchaser also agrees to defend and hold Seller harmless from any
injuries, damages or claims of any nature which Purchaser's servants, agents or
employees may have suffered as a result of Purchaser's inspection of the
Property.  Purchaser shall undertake its obligation to defend set forth in the
preceding sentence using attorneys selected by Seller, in Seller's sole
discretion.  

     Prior to commencing any such tests, studies and investigations, Purchaser
shall furnish to Seller a certificate of insurance evidencing not less than
$1,000,000 of comprehensive general public liability insurance insuring the
person, firm or entity performing such tests, studies and investigations and
listing Seller and Purchaser as additional insureds thereunder.

     If Purchaser is dissatisfied with the results of the tests, studies or
investigations performed or information received pursuant to this Paragraph
7.1, Purchaser shall have the right to terminate this Agreement by giving
written notice of such termination to Seller at any time prior to the
expiration of the Inspection Period.  If written notice is not received by
Seller pursuant to this Paragraph 7.1 prior to the expiration of the Inspection
Period, then the right of Purchaser to terminate this Agreement pursuant to
this Paragraph 7.1 shall be waived.  If Purchaser terminates this Agreement by
written notice to Seller prior to the expiration of the Inspection Period: (i)
Purchaser shall promptly deliver to Seller copies of all studies, reports and
other investigations obtained by Purchaser in connection with its due diligence
during the Inspection Period; and (ii) the Earnest Money deposited by Purchaser
shall be immediately paid to Purchaser, together with any interest earned
thereon, and neither Purchaser nor Seller shall have any right, obligation or
liability under this Agreement, except for Purchaser's obligation to indemnify
Seller and restore the Property, as more fully set forth in this Paragraph 7.1.
Notwithstanding anything contained herein to the contrary, the terms of this
Paragraph 7.1, shall survive the Closing and the delivery of the Deed and
termination of this Agreement.

     7.2.  Except with respect to the representations and warranties contained
herein, Purchaser acknowledges and agrees (a) that it will be purchasing the
Property and the Personal Property based solely upon its inspections and
investigations of the Property and the Personal Property, and (b) that
Purchaser will be purchasing the Property and the Personal Property "AS IS" and
"WITH ALL FAULTS", based upon the condition of the Property and the Personal
Property as of the date of this Agreement, wear and tear and loss by fire or
other casualty or condemnation excepted.  Without limiting the foregoing,
Purchaser acknowledges that, except as may otherwise be specifically set forth
elsewhere in this Agreement, neither Seller nor its consultants, brokers or
agents have made any representations or warranties of any kind upon which
Purchaser is relying as to any matters concerning the Property or the Personal
Property, including, but not limited to, the condition of the land or any
improvements comprising the Property, the existence or non-existence of
"Hazardous Materials" (as hereinafter defined), economic projections or market
studies concerning the Property, any development rights, taxes, bonds,
covenants, conditions and restrictions affecting the Property, water or water
rights, topography, drainage, soil, subsoil of the Property, the utilities
serving the Property or any zoning or building laws, rules or regulations or
"Environmental Laws" (hereinafter defined) affecting the Property.  Seller
makes no representation or warranty that the Property complies with Title III
<PAGE>
of the Americans with Disabilities Act or any fire code or building code.
Except with respect to a breach by Seller of any representation or warranty
expressly contained herein relating to Environmental Laws or Hazardous
Materials, Purchaser hereby releases Seller and the Affiliates of Seller from
any and all liability in connection with any claims which Purchaser may have
against Seller or the Affiliates of Seller, and Purchaser hereby agrees not to
assert any claims for contribution, cost recovery or otherwise, against Seller
or the Affiliates of Seller, relating directly or indirectly to the existence
of asbestos or Hazardous Materials on, or environmental conditions of, the
Property, whether known or unknown.  As used herein, "Environmental Laws" means
all federal, state and local statutes, codes, regulations, rules, ordinances,
orders, standards, permits, licenses, policies and requirements (including
consent decrees, judicial decisions and administrative orders) relating to the
protection, preservation, remediation or conservation of the environment or
worker health or safety, all as amended or reauthorized, or as hereafter
amended or reauthorized, including without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.
Section 9601 et seq., the Resource Conservation and Recovery Act of 1976
("RCRA"), 42 U.S.C. Section 6901 et seq., the Emergency Planning and Community
Right-to-Know Act ("Right-to-Know Act"), 42 U.S.C. Section 11001 et seq., the
Clean Air Act ("CAA"), 42 U.S.C. Section 7401 et seq., the Federal Water
Pollution Control Act ("Clean Water Act"), 33 U.S.C. Section 1251 et seq., the
Toxic Substances Control Act ("TSCA"), 15 U.S.C. Section 2601 et seq., the Safe
Drinking Water Act ("Safe Drinking Water Act"), 42 U.S.C. Section 300f et seq.,
the Atomic Energy Act ("AEA"), 42 U.S.C. Section 2011 et seq., the Occupational
Safety and Health Act ("OSHA"), 29 U.S.C. Section 651 et seq., and the
Hazardous Materials Transportation Act (the "Transportation Act"), 49 U.S.C.
Section 1802 et seq.  As used herein, "Hazardous Materials" means:
(1) "hazardous substances," as defined by CERCLA; (2) "hazardous wastes," as
defined by RCRA; (3) any radioactive material including, without limitation,
any source, special nuclear or by-product material, as defined by AEA; (4)
asbestos in any form or condition; (5) polychlorinated biphenyls; (6)
petroleum, crude oil or any fraction or derivative of petroleum or crude oil;
and (7) any other material, substance or waste to which liability or standards
of conduct may be imposed under any Environmental Laws.  Notwithstanding
anything contained herein to the contrary, the terms of this Paragraph 7.2
shall survive the Closing and the delivery of the Deed and termination of this
Agreement.

     7.3. Seller has provided to Purchaser certain unaudited historical
financial information regarding the Property relating to certain periods of
time in which Seller owned the Property.  Seller and Purchaser hereby
acknowledge that such information has been provided to Purchaser at Purchaser's
request solely as illustrative material.  Except as expressly set forth herein,
Seller makes no representation or warranty that such material is complete or
accurate or that Purchaser will achieve similar financial or other results with
respect to the operations of the Property, it being acknowledged by Purchaser
that Seller's operation of the Property and allocations of revenues or expenses
may be vastly different than Purchaser may be able to attain.  Purchaser
acknowledges that it is a sophisticated and experienced purchaser of real
estate and further that Purchaser has relied upon its own investigation and
inquiry with respect to the operation of the Property, except with respect to
the representations and warranties of Seller expressly contained herein and
releases Seller and the Affiliates of Seller from any liability with respect to
such historical information, except with respect to a breach of a
representation or warranty of Seller contained herein.  Notwithstanding
anything contained herein to the contrary, the terms of this Paragraph 7.3
<PAGE>
shall survive the Closing and the delivery of the Deed and termination of this
Agreement.

     7.4. Seller has provided to Purchaser the following existing reports:
Phase I Environmental Site Assessment and Limited Asbestos Survey prepared by
Law Associates, Inc. dated March 16, 1992 under Project No. 58-2510,
Environmental Soil Investigative Report dated October 4, 1993 under Project No.
50011.05, Phase I Environmental Site Assessment Report dated August 31, 1993
under Project No. 50011.04, and Phase I Environmental Site Assessment Report
dated November 1, 1993 under Project No. 50011.04 ("Existing Reports").  Seller
makes no representation or warranty concerning the accuracy or completeness of
the Existing Reports.  Purchaser hereby releases Seller and the Affiliates of
Seller from any liability whatsoever with respect to the Existing Reports, or,
including, without limitation, the matters set forth in the Existing Reports,
and the accuracy and/or completeness of the Existing Reports.  Furthermore,
Purchaser acknowledges that it will be purchasing the Property with all faults
disclosed in the Existing Reports.  Notwithstanding anything contained herein
to the contrary, the terms of this Paragraph 7.4 shall survive the Closing and
the delivery of the Deed and termination of this Agreement.

8.   CLOSING.  The closing of this transaction (the "Closing") shall be on
August 1, 1996 (the "Closing Date"), at the local California office of the
Title Insurer, which time Seller shall deliver possession of the Property to
Purchaser.  This transaction shall be closed through an escrow with Title
Insurer, in accordance with the general provisions of the usual and customary
form of deed and money escrow for similar transactions in California, or at the
option of either party, the Closing shall be a "New York style" closing at
which the Purchaser shall wire the Purchase Price to Title Insurer on the
Closing Date and prior to the release of the Purchase Price to Seller,
Purchaser shall receive the Title Policy or marked up commitment dated the date
of the Closing Date.  In the event of a New York style closing, Seller shall
deliver to Title Insurer any customary affidavit in connection with a New York
style closing.  All closing and escrow fees shall be divided equally between
the parties hereto.

9.   CLOSING DOCUMENTS.

     9.1.  On or prior to the Closing Date, Seller and Purchaser shall execute
a joint closing statement.  Purchaser and Seller shall also execute (and cause
the Title Insurer to execute) a designation agreement with respect to reporting
requirements under IRC 1099.  In addition, Purchaser shall deliver to Seller
the balance of the Purchase Price, an assumption of the documents set forth in
Paragraph 9.2.3 and 9.2.4 and such other documents as may be reasonably
required by the Title Insurer in order to consummate the transaction as set
forth in this Agreement.

     9.2.  On the Closing Date, Seller shall deliver to Purchaser the
following:

          9.2.1.      the Deed (in the form of Exhibit D attached hereto),
subject to Permitted Exceptions and those Unpermitted Exceptions waived by
Purchaser;

          9.2.2.      a bill of sale conveying the Personal Property (in the
form of Exhibit E attached hereto);
<PAGE>
          9.2.3.  assignment and assumption of intangible property (in the form
attached hereto as Exhibit F), including, without limitation, the service
contracts listed in Exhibit G (the "Service Contracts");

          9.2.4.  an assignment and assumption of leases and security deposits
and pet deposits (in the form attached hereto as Exhibit H);

          9.2.5.  non-foreign affidavit (in the form of Exhibit I attached
hereto);

          9.2.6.  California Form 590 (California FIRPTA affidavit);

          9.2.7.  original, and/or copies of, leases and service contracts
affecting the Property in Seller's possession or in the possession of the
current manager of the Property;

          9.2.8.  all documents and instruments reasonably required by the
Title Insurer to issue the Title Policy; 

          9.2.9.  possession of the Property to Purchaser, subject to the terms
of leases;

          9.2.10.  evidence of the termination of the management agreement;

          9.2.11.  notice to the tenants of the Property of the transfer of
title and assumption by Purchaser of the landlord's obligation under the leases
and the obligation to refund the security deposits (in the form of Exhibit J); 

          9.2.12.  an updated rent roll;

          9.2.13.  a letter indicating payment of all association dues due
under recorded declarations or covenants and the amount thereof; and

          9.2.14.  an insured closing letter.

10.  PURCHASER'S DEFAULT.  ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS TO
SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND UNDERTAKINGS
UNDER THIS AGREEMENT.  IN THE EVENT OF A DEFAULT OF THE PURCHASER UNDER THE
PROVISIONS OF THIS AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND
THE INTEREST THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY,
EXCEPT FOR PURCHASER'S OBLIGATIONS TO INDEMNIFY SELLER AND RESTORE THE PROPERTY
AS SET FORTH IN PARAGRAPH 7.1 HEREOF.  THE PARTIES HAVE AGREED THAT SELLER'S
ACTUAL DAMAGES, IN THE EVENT OF A DEFAULT BY PURCHASER, WOULD BE EXTREMELY
DIFFICULT OR IMPRACTICAL TO DETERMINE.  THEREFORE, BY PLACING THEIR INITIALS
BELOW, THE PARTIES ACKNOWLEDGE THAT THE EARNEST MONEY HAS BEEN AGREED UPON,
AFTER NEGOTIATION, AS THE PARTIES' REASONABLE ESTIMATE OF SELLER'S DAMAGES.

11.  SELLER'S DEFAULT.  IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE THE RETURN OF ALL EARNEST MONEY
TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND THIS AGREEMENT SHALL THEN
BECOME NULL AND VOID AND OF NO EFFECT AND THE PARTIES SHALL HAVE NO FURTHER
LIABILITY TO EACH OTHER AT LAW OR IN EQUITY, EXCEPT FOR PURCHASER'S OBLIGATIONS
TO INDEMNIFY SELLER AND RESTORE THE PROPERTY AS SET FORTH MORE FULLY IN
PARAGRAPH 7.  NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IF
SELLER'S DEFAULT IS ITS WILLFUL REFUSAL TO DELIVER THE DEED, THEN PURCHASER
WILL BE ENTITLED TO SUE FOR SPECIFIC PERFORMANCE.
<PAGE>
12.  PRORATIONS.

     12.1.  Rents (exclusive of delinquent rents [i.e. unpaid on the Closing
Date], but including prepaid rents); prepaid associations dues, refundable
security and pet deposits, if any (which will be assigned to and assumed by
Purchaser and credited to Purchaser at Closing); water and other utility
charges; fuels; prepaid operating expenses; real and personal property taxes;
and other similar items shall be adjusted ratably as of 12:01 a.m. on the
Closing Date, and credited against the balance of the cash due at Closing.
Assessments payable in installments which are due subsequent to the Closing
Date shall be paid by Purchaser.  If the amount of any of the items to be
prorated is not then ascertainable, the adjustments thereof shall be on the
basis of the most recent ascertainable data.  All prorations will be final
except as to delinquent rent referred to in Paragraph 12.2 below and except as
provided in the last sentence of this section.  All refunds of real estate
taxes relating to periods prior to the Closing Date shall be the property of,
and shall be paid to, Seller.  The parties agree to make such post-closing and
readjustments as may be required due to errors and omissions in the prorations
or due to obtaining actual amounts for items which were prorated based on
estimates within thirty (30) days after the Closing Date.

     12.2.  All rent paid following the Closing Date by any tenant of the
Property who is indebted under a lease for basic rent for any period prior to
and including the Closing Date after the payment to Purchaser of all current
rent and any past due rent owed to Purchaser shall be deemed a "Post-Closing
Receipt" until such time as all such indebtedness is paid in full.  Within ten
(10) days following each receipt by Purchaser of a Post-Closing Receipt,
Purchaser shall pay such Post-Closing Receipt to Seller.  Purchaser shall use
its best efforts to collect all amounts which, upon collection, would
constitute Post-Closing Receipts hereunder but shall have no obligation to
bring legal action.  Within 120 days after the Closing Date, Purchaser shall
deliver to Seller a reconciliation statement of Post-Closing Receipts through
the first 90 days after the Closing Date.  Upon the delivery of the
Post-Closing Receipts reconciliation, Purchaser shall deliver to Seller any
Post-Closing Receipts owing to Seller and not previously delivered to Seller in
accordance with the terms hereof.  Seller retains the right to conduct an
audit, at reasonable times and upon reasonable notice, of Purchaser's books and
records to verify the accuracy of the Post-Closing Receipts reconciliation
statement and upon the verification of additional funds owing to Seller,
Purchaser shall pay to Seller said additional Post-Closing Receipts and the
cost of performing Seller's audit.  Paragraph 12.2 of this Agreement shall
survive the Closing and the delivery and recording of the deed.

13.  RECORDING.  Neither this Agreement nor a memorandum thereof shall be
recorded and the act of recording by Purchaser shall be an act of default
hereunder by Purchaser and subject to the provisions of Paragraph 10 hereof.

14.  ASSIGNMENT.  The Purchaser shall not have the right to assign its interest
in this Agreement without the prior written consent of the Seller.  Any
assignment or transfer of, or attempt to assign or transfer, Purchaser's
interest in this Agreement shall be an act of default hereunder by Purchaser
and subject to the provisions of Paragraph 10 hereof.  Notwithstanding the
foregoing, Purchaser may assign its interest in this Agreement without the
consent of Seller to any entity in which Purchaser owns a controlling interest
or for which Purchaser is the investment advisor provided that Purchaser
remains liable for and the assignee assumes the obligations of Purchaser
hereunder with respect to indemnifications and amounts payable in the event of
<PAGE>
a termination of this Agreement, including, without limitation, damages.  Upon
such assignment, Purchaser (but not the assignee) shall be released from all
other liabilities and obligations hereunder.

15.  BROKER.  The parties hereto represent and warrant that no broker
commission or finder fee is due and payable in connection with this transaction
other than to CB Commercial Real Estate Group, Inc. ("Seller's Broker") (to be
paid by Seller).  Seller's commission to Seller's Broker shall only be payable
out of the proceeds of the sale of the Property in the event the transaction
set forth herein closes.  Purchaser and Seller shall indemnify, defend and hold
the other party hereto harmless from any claim whatsoever (including without
limitation, reasonable attorney's fees, court costs and costs of appeal) from
anyone claiming by or through the indemnifying party any fee, commission or
compensation on account of this Agreement, its negotiation or the sale hereby
contemplated other than to Seller's Broker.  The indemnifying party shall
undertake its obligations set forth in this Paragraph 15 using attorneys
selected by the indemnifying party and reasonably acceptable to the indemnified
party.  The provisions of this Paragraph 15 will survive the Closing and
delivery of the Deed.

16.  REPRESENTATIONS AND WARRANTIES.

     16.1.  Any reference herein to Seller's knowledge or notice of any matter
or thing shall only mean such actual knowledge of Mark Saturno or Reid Reynolds
(asset manager) ("Seller's Representatives") or notice that has actually been
received or sent by Seller's Representatives, and any representation or
warranty of the Seller is based upon those matters of which the Seller's
Representatives has actual knowledge or receipt.  Seller's Representatives
shall deliver a copy of the representations and warranties contained in
Paragraph 16.2 below to the existing property manager, Darlene Molner, for its
review and request the property manager inform Seller's Representative of any
inaccuracies contained in such representations and warranties.  Except as set
forth in the previous two sentences, any knowledge or notice given, had or
received by any of Seller's agents, servants or employees shall not be imputed
to Seller, the general partner or limited partners of Seller, the subpartners
of the general partner or limited partners of Seller or Seller's
Representatives. 

     16.2.  Subject to the limitations set forth in Paragraph 16.1, Seller
hereby makes the following representations and warranties, which
representations and warranties are made to Seller's knowledge and which shall,
subject to Paragraph 16.4, be remade at Closing, and shall survive Closing to
the extent set forth in Paragraph 16.5: 

     (i)  Seller has no knowledge of any pending or threatened litigation,
claim, cause of action or administrative proceeding concerning the Property,
including, without limitation, against Seller under the Fair Housing Act (42
U.S.C. Sec. 3601 et.seq., as amended); 

     (ii) Seller has the full right, power and authority to execute and deliver
this Agreement (and the documents and instruments to be executed and delivered
by Seller pursuant hereto) and consummate the transactions contemplated herein,
and this Agreement (and the documents and instruments to be executed and
delivered by Seller pursuant hereto) is the legal, valid and binding obligation
of Seller, enforceable in accordance with its terms, and does not and will not
at Closing violate or conflict with any provisions of any agreement to which
Seller is a party;
<PAGE>
     (iii)     the rent roll attached hereto as Exhibit K (the "Rent Roll")
which Seller will update as of the Closing Date is accurate and complete (but
only as to the information contained thereon) as of the date set forth thereon;

     (iv) Seller has not received written notice of any material default or
material breach on the part of the landlord under any lease shown on the Rent
Roll;

     (v)  Seller has not received written notice from any governmental
authority that the use and operation of the Property is in violation of
applicable building codes, zoning or land use laws which has not previously
been corrected;

     (vi) Seller is not a "foreign person" within the meaning of section
1445(f)(3) of the Internal Revenue Code of 1986, as amended and that Seller
will furnish to Purchaser, at or prior to Closing, an affidavit in form
satisfactory to Purchaser confirming the same;

     (vii)     Seller has no employees working at the Property;

     (viii)    There are no service contracts affecting the Property, other
than the Service Contracts listed in Exhibit G and Seller has received no
written notice of default with respect to any of the Service Contracts; 

     (ix) Except as may be set forth in the Existing Reports, Seller has not
received any written notice from any governmental authority having jurisdiction
over the Property of any uncured violation of any Environmental Law with
respect to the Property; and

     (x)  The Existing Reports are the only environmental report of the
Property provided to or obtained by Seller since November, 1993.

     16.3.  Purchaser hereby represents and warrants to Seller that Purchaser
has the full right, power and authority to execute and deliver this Agreement
and consummate the transactions contemplated herein (and the documents and
instruments to be executed and delivered by Purchaser pursuant hereto), and
this Agreement is the legal, valid and binding obligation of Purchaser,
enforceable with its terms, and does not and will not at Closing violate or
conflict with any provisions of any agreement to which Purchaser is a party.

     16.4.  If at any time after the execution of this Agreement, either
Purchaser or Seller become aware of information which makes a representation
and warranty contained in this Agreement to become untrue in any material
respect, said party shall promptly disclose said information to the other party
hereto.  Provided the party making the representation or warranty did not take
any deliberate actions to cause the representation or warranty in question to
become untrue in any material respect, said party shall not be in default under
this Agreement and the sole remedy of the other party shall be to terminate
this Agreement, except for Purchaser's obligation to indemnify Seller and
restore the Property, as more fully set forth in Paragraph 7.  Notwithstanding
anything contained herein to the contrary, if the status of any of the
tenancies changes from the date of the rent roll attached hereto and the date
of the rent roll delivered at Closing, provided the change in status is not
caused by a breach of Seller's covenants contained in Paragraph 16.6 herein,
then Purchaser shall not have the right to terminate this Agreement or make any
claim for a breach of a representation or warranty hereunder involving the rent
roll or tenancies thereunder.  Purchaser and Seller are prohibited from making
any claims against the other party hereto after the Closing with respect to any
<PAGE>
breaches of the other party's representations and warranties contained in this
Agreement that the claiming party has actual knowledge of prior to the Closing.

     16.5.     The parties agree that the representations contained herein
shall survive Closing for a period of four (4) months (i.e., the claiming party
shall have no right to make any claims against the other party for a breach of
a representation or warranty after the expiration of four (4) months
immediately following Closing).

     16.6.     Seller covenants to operate, lease, maintain and manage the
Property in the same manner that it has managed, maintained, leased and
operated the Property during the period of Seller's ownership, subject to
reasonable wear and tear and casualty.  Without limitation of the foregoing, so
long as this Agreement shall remain in effect:  Seller shall maintain Seller's
current insurance coverage presently in effect; Seller shall not enter into any
letter of intent or contract to sell the Property with any third party; Seller
shall furnish Purchaser with monthly rent rolls, delinquency reports and
operating statements as they become available; Seller agrees not to enter into
any other service contracts affecting the Property which cannot be terminated
without cause on 30 days notice, without penalty; commencing five (5) days
prior to Closing, Seller shall cooperate with Purchaser's management personnel
in arranging for a management transition; and Seller agrees to terminate any
and all management agreements affecting the Property as of the Closing Date.

     16.7.  The continued accuracy in all material respects of the aforesaid
representations and warranties shall be a condition precedent to Purchaser's
obligation to close.  If at Closing any of said representations and warranties
shall not be correct at the time the same is made in any material respect,
Purchaser may, as its sole and exclusive remedy, terminate this Agreement in
which event the earnest money shall be returned to Purchaser, including all
interest earned thereon, and there shall be no further liability of either
party to the other, except for Purchaser's obligation to indemnify Seller and
restore the Property, as more fully set forth in Paragraph 7.  

17.  LIMITATION OF LIABILITY.  None of any partners of Seller, Affiliate of
Seller or any of their respective beneficiaries, shareholders, partners,
officers, directors, agents or employees, heirs, successors or assigns shall
have any personal liability of any kind or nature for or by reason of any
matter or thing whatsoever under, in connection with, arising out of or in any
way related to this Agreement and the transactions contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability.

     Notwithstanding anything contained herein to the contrary, Purchaser
hereby agrees that the maximum aggregate liability of Seller, in connection
with, arising out of or in any way related to a breach by Seller under this
Agreement or any document or conveyance agreement in connection with the
transaction set forth herein after the Closing shall be $200,000.  Purchaser
hereby waives for itself and anyone who may claim by, through or under
Purchaser any and all rights to sue or recover from Seller any amount greater
than said limit.

18.  TIME OF ESSENCE.  Time is of the essence of this Agreement.
<PAGE>
19.  NOTICES.  Any notice or demand which either party hereto is required or
may desire to give or deliver to or make upon the other party shall be in
writing and may be personally delivered or given or made by overnight courier
such as Federal Express, by facsimile transmission or made by United States
registered or certified mail addressed as follows:

         TO SELLER:           c/o The Balcor Company
                              Bannockburn Lake Office Plaza
                              2355 Waukegan Road
                              Suite A-200
                              Bannockburn, Illinois  60015
                              Attention:  Ilona Adams

         with copies to:      The Balcor Company
                              Bannockburn Lake Office Plaza
                              2355 Waukegan Road
                              Suite A-200
                              Bannockburn, Illinois  60015
                              Attention:  Alan Lieberman
                              (708) 317-4360
                              (708) 317-4462 (FAX)

         and to:              Katten Muchin & Zavis
                              525 West Monroe Street
                              Suite 1600
                              Chicago, Illinois  60661-3693
                              Attention:  Daniel J. Perlman, Esq.
                              (312) 902-5532
                              (312) 902-1061 (FAX)

         TO PURCHASER:        RREEF Funds
                              650 California Street
                              Suite 1800
                              San Francisco, California  94109
                              Attention:  Scott M. Stuckman and Tracy DeMay
                              (415) 781-3300
                              (415) 781-2229 (FAX)

         and one copy to:     Orrick, Herrington & Sutcliffe
                              777 South Figueroa Street
                              Los Angeles, California  90017
                              Attention:  Sara H. Reynolds, Esq.
                              (213) 612-2479
                              (213) 612-2499 (FAX)

subject to the right of either party to designate a different address for
itself by notice similarly given.  Any notice or demand so given shall be
deemed to be delivered, received or made on the next business day if sent by
overnight courier, or the same day as given if sent by facsimile transmission
and received by 5:00 p.m. Chicago time or on the 4th business day after the
same is deposited in the United States Mail as registered or certified matter,
addressed as above provided, with postage thereon fully prepaid.  Any such
notice, demand or document not given, delivered or made by registered or
certified mail, by overnight courier or by facsimile transmission as aforesaid
shall be deemed to be given, delivered or made upon receipt of the same by the
party to whom the same is to be given, delivered or made.  Copies of all
notices shall be served upon the Escrow Agent.
<PAGE>
20.  EXECUTION OF AGREEMENT AND ESCROW AGREEMENT.  Purchaser will execute two
(2) copies of this Agreement and three (3) copies of the Escrow Agreement and
forward them to Seller for execution.  Within one (1) business day of receipt
of a fully executed copy (which may be transmitted by telecopy or to
Purchaser's attorney) of this Agreement, Purchaser shall wire transfer the
Earnest Money to the Escrow Agent set forth in the Escrow Agreement.  Seller
will forward one (1) copy of the executed Agreement to Purchaser and will
forward the following to the Escrow Agent:

     (A)  One (1) fully executed copy of this Agreement; and

     (B)  Three (3) copies of the Escrow Agreement signed by the parties with a
direction to execute two (2) copies of the Escrow Agreement and deliver a fully
executed copy to each of the Purchaser and the Seller.

21.  GOVERNING LAW.  The provisions of this Agreement shall be governed by the
laws of the California, except that with respect to the retainage of the
Earnest Money as liquidated damages the laws of the State of Illinois shall
govern.

22.  ENTIRE AGREEMENT.  This Agreement constitutes the entire agreement between
the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.

23.  COUNTERPARTS.  This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.

24.  CAPTIONS.  Paragraph titles or captions contained herein are inserted as a
matter of convenience and for reference, and in no way define, limit, extend or
describe the scope of this Agreement or any provision hereof.

25.  CONDITION PRECEDENT.  Subject to the remedies available to the parties
hereunder in the event of a default, it is a condition precedent to Seller's
and Purchaser's obligations to perform under this Agreement that Purchaser
acquire that certain property commonly known as Sand Pebble II Apartments (the
"Other Property") in accordance with the terms of the Agreement of Sale (the
"Other Property Contract") between 3957 Pierce Limited Partnership ("Other
Property Seller") and Purchaser of even date herewith for the sale of the Other
Property to Purchaser.  The purchase and sale of the Property and the purchase
and sale of the Other Property shall occur simultaneously.

     The occurrence of a default by Purchaser under the Other Property Contract
shall constitute an event of default by Purchaser under this Agreement and the
occurrence of a default by Purchaser under this Agreement shall constitute an
event of default by Purchaser under the Other Property Contract.  If Seller
defaults under this Agreement, Purchaser shall have the right to elect to
terminate the Other Property Contract and in such event Purchaser shall be
entitled to receive all earnest money deposited pursuant to the Other Property
Contract and all interest earned thereon.  If Seller defaults under the Other
Property Contract, Purchaser shall have the right to elect to terminate the
Contract and in such event Purchaser shall be entitled to receive all earnest
money deposited pursuant hereto and all interest earned thereon.  
<PAGE>
     If Purchaser terminates this Agreement pursuant to Section 7 hereof, or
pursuant to any other section of this Agreement, the Purchaser shall also be
deemed to have terminated the Other Property Contract.  Similarly, if Purchaser
terminates the Other Property Contract pursuant to Paragraph 7 thereof or any
other section of the Other Property Contract, Purchaser shall also be deemed to
have terminated this Agreement.

     IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of
the date first set forth above.


                              PURCHASER:

                              RREEF AMERICA L.L.C., a Delaware limited
                              liability company


                              By: /s/Scott M. Stuckman
                                 -------------------------------
                              Name:  Scott M. Stuckman
                                   -----------------------------
                              Its:   Authorized Representative
                                  ------------------------------

                              SELLER:

                              PEBBLE SAND LIMITED PARTNERSHIP, an Illinois
                              limited partnership

                              By:  Pebble Sand Partners, Inc., an Illinois
                                   corporation, its general partner


                                   By: /s/Alan G. Lieberman
                                      ------------------------------
                                   Name:  Alan G. Lieberman
                                        ----------------------------
                                   Its:   Senior Vice President
                                       -----------------------------
<PAGE>
               of CB Commercial Real Estate Group, Inc. ("Seller's Broker")
executed this Agreement in its capacity as a real estate broker and
acknowledges that the fee or commission due it from Seller as a result of the
transaction described in this Agreement is as set forth in that certain Listing
Agreement, dated __, 199_ between Seller and Seller's Broker (the "Listing
Agreement").  Seller's Broker also acknowledges that payment of the aforesaid
fee or commission is conditioned upon the Closing and the receipt of the
Purchase Price by the Seller.  Seller's Broker agrees to deliver a receipt to
the Seller at the Closing for the fee or commission due Seller's Broker and a
release, in the appropriate form, stating that no other fees or commissions are
due to it from Seller or Purchaser.

                              CB Commercial Real Estate Group, Inc.



                              By:__________________________________
<PAGE>
                                   Exhibits

A    -    Legal

B    -    Personal Property

C    -    Escrow Agreement

D    -    Deed

E    -    Bill of Sale

F    -    Assignment and Assumption of Intangible Property

G    -    Service Contracts

H    -    Assignment and Assumption of Leases and Security Deposits

I    -    Non-Foreign Affidavit

J    -    Notice to Tenants

K    -    Rent Roll
<PAGE>

                               AGREEMENT OF SALE


     THIS AGREEMENT OF SALE (this "Agreement"), is entered into as of the 28th
day of June 1996, by and between RREEF AMERICA L.L.C., a Delaware limited
liability company ("Purchaser"), and 3957 PIERCE LIMITED PARTNERSHIP, an
Illinois limited partnership ("Seller").

                             W I T N E S S E T H:

1.   PURCHASE AND SALE.  Purchaser agrees to purchase and Seller agrees to sell
at the price of Twelve Million Eighty-Eight Thousand Two Hundred Thirty-Five
And No/100 Dollars ($12,088,235.00) (the "Purchase Price"), that certain
property commonly known as Sand Pebble Village II Apartments, Riverside,
California, legally described on Exhibit A attached hereto (the "Property").
Included in the Purchase Price is all of the personal property set forth on
Exhibit B attached hereto (the "Personal Property"), all of the buildings
located on the Property, all right, title and interest of Seller, if any, in
and to (a) all open or proposed highways, streets, roads, avenues, alleys,
easements, strips, gores and rights-of-way in, on, across, in front of,
contiguous to, abutting or adjoining the Property, (b) the name "Sand Pebble
Village II Apartments", (c) all plans and specifications, (c) all transferable
licenses, permits, guaranties and warranties relating to the zoning, land use,
ownership, operation, occupancy, construction or maintenance of the Premises
and buildings thereon, (d) all fixtures, equipment and supplies owned by Seller
located on the Property, and (e) all Leases (hereinafter defined), rights and
privileges of Seller pertaining to the Property.

2.   PURCHASE PRICE.  The Purchase Price shall be paid by Purchaser as follows:

     2.1.  No later than one business day following the execution of this
Agreement by both parties, the sum of One Hundred Fifty Thousand and No/100
Dollars ($150,000.00) (the "Earnest Money") to be held in escrow by and in
accordance with the provisions of the Escrow Agreement ("Escrow Agreement")
attached hereto as Exhibit C; and

     2.2.  On the "Closing Date" (hereinafter defined), the balance of the
Purchase Price, adjusted in accordance with the prorations, by federally wired
"immediately available" funds, on or before 11:00 a.m Chicago time.

3.   TITLE COMMITMENT AND SURVEY.

     3.1.  Seller has ordered, and will deliver to Purchaser promptly following
Seller's receipt of a title commitment for an owner's standard title insurance
policy issued by an agent for Lawyer's Title Insurance Corporation (hereinafter
referred to as "Title Insurer") for the Property (the "Title Commitment").  The
Title Commitment shall be conclusive evidence of good title as therein shown as
to all matters to be insured by the title policy, subject only to the
exceptions therein stated.  On the Closing Date, Title Insurer shall deliver to
Purchaser a standard title policy in conformance with the previously delivered
Title Commitment, subject to Permitted Exceptions and Unpermitted Exceptions
(as said terms are defined below) waived by Purchaser (the "Title Policy").
Seller and Purchaser shall each pay for one-half of the costs of the Title
Commitment and Title Policy and Purchaser shall pay for the cost of any
endorsements (other than endorsements obtained by Seller in order to insure
over Unpermitted Exceptions) to, or extended coverage on, the Title Policy.
<PAGE>
     3.2.  Seller has ordered, and will deliver to Purchaser promptly following
Seller's receipt of a survey of the Property (the "Survey").  Seller and
Purchaser shall each pay for one-half of the costs of the Survey.  The Survey
shall be made in accordance with Purchaser's survey standards furnished to
Seller.

     3.3. The obligation of Purchaser to pay various costs set forth in
Paragraphs 3.1 and 3.2 shall survive the termination of this Agreement.

     3.4. On or before the later to occur of (a) July 11, 1996; or (b) five (5)
business days following Purchaser's receipt of the Title Commitment, the
Schedule B documents referenced in the Title Commitment, and the Survey (the
"Title/Survey Review Deadline Date"), Purchaser shall advise Seller in writing
if any exceptions to title shown on the Title Commitment are disapproved by
Purchaser or any matters on the Survey are unacceptable to Purchaser.  If
Purchaser does not so advise Seller on or before the Title/Survey Review
Deadline Date, all exceptions to title shown on the Title Commitment shall be
deemed Permitted Exceptions and all matters shown on the Survey shall be deemed
acceptable to Purchaser.  For purposes of this Agreement, "Permitted
Exceptions" shall mean: (a) general real estate taxes, association assessments,
special assessments, special district taxes and related charges not yet due and
payable; (b) matters shown on the Survey not disapproved by Purchaser in
writing as provided above; (c) matters caused by the actions of Purchaser; and
(d) the title exceptions set forth in the Title Commitment not disapproved in
writing by Purchaser as provided above, to the extent that same affect the
Property.  Purchaser agrees to use diligent efforts to cause the Title Insurer
to remove the general printed exceptions contained in the standard title policy
to be issued by Title Insurer, including, without limitation, paying the cost
thereof, and Seller agrees to execute standard Lawyer's Title "ALTA" statements
in the form customarily used in California in order to assist Purchaser in
obtaining extended coverage but shall not be obligated to incur any cost or
liability (other than on account of the ALTA statement) in providing such
assistance.  If Purchaser fails to use such diligent efforts, the general
printed exceptions will constitute Permitted Exceptions.  All exceptions to
title other than those described above in this Paragraph shall be referred to
as "Unpermitted Exceptions".  With respect to Unpermitted Exceptions for liens
and encumbrances of a definite or ascertainable amount securing borrowed money,
mechanics liens or for unpaid real estate taxes and assessments ("Monetary
Unpermitted Exceptions"), the indebtedness giving rise to such Monetary
Unpermitted Exceptions will be paid at the Closing and the lien thereby
released and removed.  Seller's obligations under the preceding sentence shall
be limited to Monetary Unpermitted Exceptions arising out of an affirmative
action of Seller (such as execution of a mortgage, entering into a contract for
construction work on the Property or non-payment of real estate taxes).  Any
Unpermitted Exceptions to title which are insured over by the Title Insurer and
reasonably approved as such by Purchaser, as provided herein, shall be deemed
Permitted Exceptions.  If Seller fails to have any Unpermitted Exceptions
(other than a Monetary Unpermitted Exception) removed or insured over prior to
ten (10) business days following the Title/Survey Review Deadline Date (the
"Seller Response Date"), Purchaser may elect, by written notice to Seller given
within five (5) business days following the Seller Response Date, (i) to accept
title as it then is (in which case such exceptions shall be deemed "Permitted
Exceptions"), or (ii) to terminate this Agreement, in which case this Agreement
shall become null and void without further action of the parties and all
Earnest Money theretofore deposited into the escrow by Purchaser together with
any interest accrued thereon, shall be returned to Purchaser, and neither party
shall have any further liability to the other, except for Purchaser's
<PAGE>
obligation to indemnify Seller and restore the Property, as more fully set
forth in Paragraph 7.  Purchaser shall have the right to pay Monetary
Unpermitted Exceptions at Closing, if Seller fails to do so, at no liability or
cost to Seller and no adjustment to the Purchase Price. 

4.   PAYMENT OF CLOSING COSTS.

     In addition to the costs set forth in Paragraphs 3.1 and 3.2, Purchaser
and Seller shall each pay for one-half of the costs of the documentary or
transfer stamps to be paid with reference to the "Deed" (hereinafter defined)
and all other stamps, intangible, transfer, documentary, recording, sales tax
and surtax imposed by law with reference to any other sale documents delivered
in connection with the sale of the Property to Purchaser and all other charges
of the Title Insurer in connection with this transaction.  Purchaser shall not
be required to incur title charges or escrow fees on account of using Charter
Title Company which exceed those that would normally be charged by the Title
Insurer. 

5.   CONDITION OF TITLE.

     5.1.  If, prior to "Closing" (as hereinafter defined), a date-down to the
Title Commitment discloses any new Unpermitted Exception, Seller shall have
thirty (30) days from the date of Purchaser's notification to Seller of such
new Unpermitted Exception (which will be given by Purchaser, if at all, not
later than five (5) business days after Purchaser's receipt of the date-down to
the Title Commitment), at Seller's expense, to (i) bond over with a bonding
company reasonably satisfactory to Purchaser, cure and/or have any Unpermitted
Exceptions which, in the aggregate, do not exceed $25,000.00, removed from the
Title Commitment or to have the Title Insurer commit to insure against loss or
damage that may be occasioned by such Unpermitted Exceptions on the condition
that the form of endorsement shall be reasonably satisfactory to Purchaser, or
(ii) have the right, but not the obligation, to bond over (with a bonding
company reasonably satisfactory to Purchaser), cure and/or have any Unpermitted
Exceptions which, in the aggregate, equal or exceed $25,000.00, removed from
the Title Commitment or to have the Title Insurer commit to insure against loss
or damage that may be occasioned by such Unpermitted Exceptions on the
condition that the form of endorsement shall be reasonably satisfactory to
Purchaser.  In such event, the time of Closing shall be delayed, if necessary,
to give effect to said aforementioned time periods.  If Seller fails to cure or
have said Unpermitted Exception removed or have the Title Insurer commit to
insure as specified above within said thirty (30) day period or if Seller
elects not to exercise its rights under (ii) in the preceding sentence,
Purchaser may terminate this Agreement upon notice to Seller within five (5)
days after the expiration of said thirty (30) day period.  Absent notice from
Purchaser to Seller in accordance with the preceding sentence, Purchaser shall
be deemed to have elected to take title subject to said Unpermitted Exception.
Purchaser may, at Purchaser's sole cost and expense, and without any liability
to Seller, bond over any Unpermitted Exception.  If Purchaser terminates this
Agreement in accordance with the terms of this Paragraph 5.1, this Agreement
shall become null and void without further action of the parties and all
Earnest Money theretofore deposited into the escrow by Purchaser together with
any interest accrued thereon, shall be returned to Purchaser, and neither party
shall have any further liability to the other, except for Purchaser's
obligation to indemnify Seller and restore the Property, as more fully set
forth in Paragraph 7.
<PAGE>
     5.2.  Seller agrees to convey fee simple title to the Property to
Purchaser by grant deed (the "Deed") in recordable form subject only to the
Permitted Exceptions and any Unpermitted Exceptions waived by Purchaser.

     5.3. Seller agrees that if a special assessment is enacted prior to the
Closing Date, notwithstanding Section 3.4(a), Purchaser shall have the right to
terminate this Agreement by written notice to Seller within five (5) days after
Purchaser has actual notice of such enactment.

6.   CONDEMNATION, EMINENT DOMAIN, DAMAGE AND CASUALTY.

     6.1.  Except as provided in the indemnity provisions contained in
Paragraph 7.1 of this Agreement, Seller shall bear all risk of loss with
respect to the Property up to the earlier of the dates upon which either
possession or title is transferred to Purchaser in accordance with this
Agreement.  Notwithstanding the foregoing, in the event of damage to the
Property by fire or other casualty prior to the Closing Date, repair of which
would cost less than or equal to $100,000.00 (as determined by Seller in good
faith) Purchaser shall not have the right to terminate its obligations under
this Agreement by reason thereof, but Seller shall have the right to elect to
either repair and restore the Property to Purchaser's reasonable satisfaction
(in which case the Closing Date shall be extended until completion of such
restoration, which restoring shall be pursued diligently) or to assign and
transfer to Purchaser on the Closing Date all of Seller's right, title and
interest in and to all insurance proceeds paid or payable to Seller on account
of such fire or casualty, and Seller shall pay to Purchaser at the Closing the
amount of Seller's insurance deductible.  Seller shall promptly notify
Purchaser in writing of any such fire or other casualty and Seller's
determination of the cost to repair the damage caused thereby.  In the event of
damage to the Property by fire or other casualty prior to the Closing Date,
repair of which would cost in excess of $100,000.00 (as determined by Seller in
good faith), then this Agreement may be terminated at the option of Purchaser,
which option shall be exercised, if at all, by Purchaser's written notice
thereof to Seller within five (5) business days after Purchaser receives
written notice of such fire or other casualty and Seller's determination of the
amount of such damages, and upon the exercise of such option by Purchaser this
Agreement shall become null and void, the Earnest Money deposited by Purchaser
shall be returned to Purchaser together with interest thereon, and neither
party shall have any further liability or obligations hereunder.  In the event
that Purchaser does not exercise the option set forth in the preceding
sentence, the Closing shall take place on the Closing Date and Seller shall
assign and transfer to Purchaser on the Closing Date all of Seller's right,
title and interest in and to all insurance proceeds paid or payable to Seller
on account of the fire or casualty, and Seller shall pay to Purchaser at the
Closing the amount of Seller's insurance deductible.

     6.2.  If between the date of this Agreement and the Closing Date, any
condemnation or eminent domain proceedings are initiated or threatened by a
notice to Seller from a governmental authority which might result in the taking
of any part of the Property or the taking or closing of any right of access to
the Property, Seller shall immediately notify Purchaser of such occurrence.  In
the event that the taking of any part of the Property shall: (i) materially
impair access to the Property; (ii) cause any material non-compliance with any
applicable law, ordinance, rule or regulation of any federal, state or local
authority or governmental agencies having jurisdiction over the Property or any
portion thereof or cause the property to be a non-conforming use or structure;
(iii) materially and adversely impair the use of the Property as it is
<PAGE>
currently being operated, or (iv) result in the loss of a portion of a
building, parking spaces or improvements constituting an amenity (hereinafter
collectively referred to as a "Material Event"), Purchaser may:

          6.2.1.  terminate this Agreement by written notice to Seller, in
which event the Earnest Money deposited by Purchaser, together with interest
thereon, shall be returned to Purchaser and all rights and obligations of the
parties hereunder with respect to the closing of this transaction will cease;
or

          6.2.2.  proceed with the Closing, in which event Seller shall assign
to Purchaser all of Seller's right, title and interest in and to any award made
in connection with such condemnation or eminent domain proceedings.

     6.3. Purchaser shall then notify Seller, within five (5) business days
after Purchaser's receipt of Seller's notice, whether Purchaser elects to
exercise its rights under Paragraph 6.2.1 or Paragraph 6.2.2.  Closing shall be
delayed, if necessary, until Purchaser makes such election.  If Purchaser fails
to make an election within such five (5) business day period, Purchaser shall
be deemed to have elected to exercise its rights under Paragraph 6.2.2.  If
between the date of this Agreement and the Closing Date, any condemnation or
eminent domain proceedings are initiated which do not constitute a Material
Event, Purchaser shall be required to proceed with the Closing, in which event
Seller shall assign to Purchaser all of Seller's right, title and interest in
and to any award made in connection with such condemnation or eminent domain
proceedings.

7.   INSPECTION AND AS-IS CONDITION.

     7.1.  During the period commencing on June 17, 1996 and ending at 5:00
p.m. Chicago time on July 17, 1996 (said period being herein referred to as the
"Inspection Period"), Purchaser and the agents, engineers, employees,
contractors and surveyors retained by Purchaser may enter upon the Property, at
any reasonable time and upon reasonable prior notice to Seller, to inspect the
Property, including a review of leases located at the Property, and to conduct
and prepare such studies, tests and surveys as Purchaser may deem reasonably
necessary and appropriate.  In connection with Purchaser's review of the
Property, Seller agrees to deliver to Purchaser copies of the current rent roll
for the Property, the current delinquency report for the Property, the most
recent real estate tax and insurance bills, utility account numbers, service
contracts, and unaudited year end 1995 and year-to-date (through April 30,
1996) operating statements. 

     All of the foregoing tests, investigations and studies to be conducted
under this Paragraph 7.1 by Purchaser shall be at Purchaser's sole cost and
expense, and if as a result of Purchaser's investigations and inspections of
the Property there is damage or injury to persons or property, Purchaser shall
restore the Property to the condition existing prior to the performance of such
tests or investigations by or on behalf of Purchaser.  Purchaser shall not
allow or permit any liens or encumbrances to arise or exist against the
Property or any part thereof as a result of its inspections.  Purchaser shall
defend, protect, indemnify and hold Seller and any affiliate, parent of Seller,
and all shareholders, employees, officers and directors of Seller or Seller's
affiliate or parent (hereinafter collectively referred to as "Affiliate of
Seller") harmless from any and all actual loss, liability or damages (including
without limitation, reasonable attorney's fees, court costs and costs of appeal
but excluding consequential damages) suffered or incurred by Seller or
<PAGE>
Affiliates of Seller for injury to persons or property caused by Purchaser or
Purchaser's agents entry on the Property in the course of performing any test
or inspection on the Property, including, without limitation, mechanics liens,
provided that Purchaser also agrees to defend and hold Seller harmless from any
injuries, damages or claims of any nature which Purchaser's servants, agents or
employees may have suffered as a result of Purchaser's inspection of the
Property.  Purchaser shall undertake its obligation to defend set forth in the
preceding sentence using attorneys selected by Seller, in Seller's sole
discretion.  

     Prior to commencing any such tests, studies and investigations, Purchaser
shall furnish to Seller a certificate of insurance evidencing not less than
$1,000,000 of comprehensive general public liability insurance insuring the
person, firm or entity performing such tests, studies and investigations and
listing Seller and Purchaser as additional insureds thereunder.

     If Purchaser is dissatisfied with the results of the tests, studies or
investigations performed or information received pursuant to this Paragraph
7.1, Purchaser shall have the right to terminate this Agreement by giving
written notice of such termination to Seller at any time prior to the
expiration of the Inspection Period.  If written notice is not received by
Seller pursuant to this Paragraph 7.1 prior to the expiration of the Inspection
Period, then the right of Purchaser to terminate this Agreement pursuant to
this Paragraph 7.1 shall be waived.  If Purchaser terminates this Agreement by
written notice to Seller prior to the expiration of the Inspection Period: (i)
Purchaser shall promptly deliver to Seller copies of all studies, reports and
other investigations obtained by Purchaser in connection with its due diligence
during the Inspection Period; and (ii) the Earnest Money deposited by Purchaser
shall be immediately paid to Purchaser, together with any interest earned
thereon, and neither Purchaser nor Seller shall have any right, obligation or
liability under this Agreement, except for Purchaser's obligation to indemnify
Seller and restore the Property, as more fully set forth in this Paragraph 7.1.
Notwithstanding anything contained herein to the contrary, the terms of this
Paragraph 7.1, shall survive the Closing and the delivery of the Deed and
termination of this Agreement.

     7.2.  Except with respect to the representations and warranties contained
herein, Purchaser acknowledges and agrees (a) that it will be purchasing the
Property and the Personal Property based solely upon its inspections and
investigations of the Property and the Personal Property, and (b) that
Purchaser will be purchasing the Property and the Personal Property "AS IS" and
"WITH ALL FAULTS", based upon the condition of the Property and the Personal
Property as of the date of this Agreement, wear and tear and loss by fire or
other casualty or condemnation excepted.  Without limiting the foregoing,
Purchaser acknowledges that, except as may otherwise be specifically set forth
elsewhere in this Agreement, neither Seller nor its consultants, brokers or
agents have made any representations or warranties of any kind upon which
Purchaser is relying as to any matters concerning the Property or the Personal
Property, including, but not limited to, the condition of the land or any
improvements comprising the Property, the existence or non-existence of
"Hazardous Materials" (as hereinafter defined), economic projections or market
studies concerning the Property, any development rights, taxes, bonds,
covenants, conditions and restrictions affecting the Property, water or water
rights, topography, drainage, soil, subsoil of the Property, the utilities
serving the Property or any zoning or building laws, rules or regulations or
"Environmental Laws" (hereinafter defined) affecting the Property.  Seller
makes no representation or warranty that the Property complies with Title III
<PAGE>
of the Americans with Disabilities Act or any fire code or building code.
Except with respect to a breach by Seller of any representation or warranty
expressly contained herein relating to Environmental Laws or Hazardous
Materials, Purchaser hereby releases Seller and the Affiliates of Seller from
any and all liability in connection with any claims which Purchaser may have
against Seller or the Affiliates of Seller, and Purchaser hereby agrees not to
assert any claims for contribution, cost recovery or otherwise, against Seller
or the Affiliates of Seller, relating directly or indirectly to the existence
of asbestos or Hazardous Materials on, or environmental conditions of, the
Property, whether known or unknown.  As used herein, "Environmental Laws" means
all federal, state and local statutes, codes, regulations, rules, ordinances,
orders, standards, permits, licenses, policies and requirements (including
consent decrees, judicial decisions and administrative orders) relating to the
protection, preservation, remediation or conservation of the environment or
worker health or safety, all as amended or reauthorized, or as hereafter
amended or reauthorized, including without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.
Section 9601 et seq., the Resource Conservation and Recovery Act of 1976
("RCRA"), 42 U.S.C. Section 6901 et seq., the Emergency Planning and Community
Right-to-Know Act ("Right-to-Know Act"), 42 U.S.C. Section 11001 et seq., the
Clean Air Act ("CAA"), 42 U.S.C. Section 7401 et seq., the Federal Water
Pollution Control Act ("Clean Water Act"), 33 U.S.C. Section 1251 et seq., the
Toxic Substances Control Act ("TSCA"), 15 U.S.C. Section 2601 et seq., the Safe
Drinking Water Act ("Safe Drinking Water Act"), 42 U.S.C. Section 300f et seq.,
the Atomic Energy Act ("AEA"), 42 U.S.C. Section 2011 et seq., the Occupational
Safety and Health Act ("OSHA"), 29 U.S.C. Section 651 et seq., and the
Hazardous Materials Transportation Act (the "Transportation Act"), 49 U.S.C.
Section 1802 et seq.  As used herein, "Hazardous Materials" means:
(1) "hazardous substances," as defined by CERCLA; (2) "hazardous wastes," as
defined by RCRA; (3) any radioactive material including, without limitation,
any source, special nuclear or by-product material, as defined by AEA; (4)
asbestos in any form or condition; (5) polychlorinated biphenyls; (6)
petroleum, crude oil or any fraction or derivative of petroleum or crude oil;
and (7) any other material, substance or waste to which liability or standards
of conduct may be imposed under any Environmental Laws.  Notwithstanding
anything contained herein to the contrary, the terms of this Paragraph 7.2
shall survive the Closing and the delivery of the Deed and termination of this
Agreement.

     7.3. Seller has provided to Purchaser certain unaudited historical
financial information regarding the Property relating to certain periods of
time in which Seller owned the Property.  Seller and Purchaser hereby
acknowledge that such information has been provided to Purchaser at Purchaser's
request solely as illustrative material.  Except as expressly set forth herein,
Seller makes no representation or warranty that such material is complete or
accurate or that Purchaser will achieve similar financial or other results with
respect to the operations of the Property, it being acknowledged by Purchaser
that Seller's operation of the Property and allocations of revenues or expenses
may be vastly different than Purchaser may be able to attain.  Purchaser
acknowledges that it is a sophisticated and experienced purchaser of real
estate and further that Purchaser has relied upon its own investigation and
inquiry with respect to the operation of the Property, except with respect to
the representations and warranties of Seller expressly contained herein and
releases Seller and the Affiliates of Seller from any liability with respect to
such historical information, except with respect to a breach of a
representation or warranty of Seller contained herein.  Notwithstanding
anything contained herein to the contrary, the terms of this Paragraph 7.3
<PAGE>
shall survive the Closing and the delivery of the Deed and termination of this
Agreement.

     7.4. Seller has provided to Purchaser the following existing reports:
Phase I Environmental Site Assessment and Limited Asbestos Survey prepared by
Law Associates, Inc. dated March 16, 1992 under Project No. 58-2510,
Environmental Soil Investigative Report dated October 4, 1993 under Project No.
50011.05, Phase I Environmental Site Assessment Report dated August 31, 1993
under Project No. 50011.04, and Phase I Environmental Site Assessment Report
dated November 1, 1993 under Project No. 50011.04 ("Existing Reports").  Seller
makes no representation or warranty concerning the accuracy or completeness of
the Existing Reports.  Purchaser hereby releases Seller and the Affiliates of
Seller from any liability whatsoever with respect to the Existing Reports, or,
including, without limitation, the matters set forth in the Existing Reports,
and the accuracy and/or completeness of the Existing Reports.  Furthermore,
Purchaser acknowledges that it will be purchasing the Property with all faults
disclosed in the Existing Reports.  Notwithstanding anything contained herein
to the contrary, the terms of this Paragraph 7.4 shall survive the Closing and
the delivery of the Deed and termination of this Agreement.

8.   CLOSING.  The closing of this transaction (the "Closing") shall be on
August 1, 1996 (the "Closing Date"), at the local California office of the
Title Insurer, which time Seller shall deliver possession of the Property to
Purchaser.  This transaction shall be closed through an escrow with Title
Insurer, in accordance with the general provisions of the usual and customary
form of deed and money escrow for similar transactions in California, or at the
option of either party, the Closing shall be a "New York style" closing at
which the Purchaser shall wire the Purchase Price to Title Insurer on the
Closing Date and prior to the release of the Purchase Price to Seller,
Purchaser shall receive the Title Policy or marked up commitment dated the date
of the Closing Date.  In the event of a New York style closing, Seller shall
deliver to Title Insurer any customary affidavit in connection with a New York
style closing.  All closing and escrow fees shall be divided equally between
the parties hereto.

9.   CLOSING DOCUMENTS.

     9.1.  On or prior to the Closing Date, Seller and Purchaser shall execute
a joint closing statement.  Purchaser and Seller shall also execute (and cause
the Title Insurer to execute) a designation agreement with respect to reporting
requirements under IRC 1099.  In addition, Purchaser shall deliver to Seller
the balance of the Purchase Price, an assumption of the documents set forth in
Paragraph 9.2.3 and 9.2.4 and such other documents as may be reasonably
required by the Title Insurer in order to consummate the transaction as set
forth in this Agreement.

     9.2.  On the Closing Date, Seller shall deliver to Purchaser the
following:

          9.2.1.      the Deed (in the form of Exhibit D attached hereto),
subject to Permitted Exceptions and those Unpermitted Exceptions waived by
Purchaser;

          9.2.2.      a bill of sale conveying the Personal Property (in the
form of Exhibit E attached hereto);
<PAGE>
          9.2.3.  assignment and assumption of intangible property (in the form
attached hereto as Exhibit F), including, without limitation, the service
contracts listed in Exhibit G (the "Service Contracts");

          9.2.4.  an assignment and assumption of leases and security deposits
and pet deposits (in the form attached hereto as Exhibit H);

          9.2.5.  non-foreign affidavit (in the form of Exhibit I attached
hereto);

          9.2.6.  California Form 590 (California FIRPTA affidavit);

          9.2.7.  original, and/or copies of, leases and service contracts
affecting the Property in Seller's possession or in the possession of the
current manager of the Property;

          9.2.8.  all documents and instruments reasonably required by the
Title Insurer to issue the Title Policy; 

          9.2.9.  possession of the Property to Purchaser, subject to the terms
of leases;

          9.2.10.  evidence of the termination of the management agreement;

          9.2.11.  notice to the tenants of the Property of the transfer of
title and assumption by Purchaser of the landlord's obligation under the leases
and the obligation to refund the security deposits (in the form of Exhibit J); 

          9.2.12.  an updated rent roll;

          9.2.13.  a letter indicating payment of all association dues due
under recorded declarations or covenants and the amount thereof; and

          9.2.14.  an insured closing letter.

10.  PURCHASER'S DEFAULT.  ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS TO
SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND UNDERTAKINGS
UNDER THIS AGREEMENT.  IN THE EVENT OF A DEFAULT OF THE PURCHASER UNDER THE
PROVISIONS OF THIS AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND
THE INTEREST THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY,
EXCEPT FOR PURCHASER'S OBLIGATIONS TO INDEMNIFY SELLER AND RESTORE THE PROPERTY
AS SET FORTH IN PARAGRAPH 7.1 HEREOF.  THE PARTIES HAVE AGREED THAT SELLER'S
ACTUAL DAMAGES, IN THE EVENT OF A DEFAULT BY PURCHASER, WOULD BE EXTREMELY
DIFFICULT OR IMPRACTICAL TO DETERMINE.  THEREFORE, BY PLACING THEIR INITIALS
BELOW, THE PARTIES ACKNOWLEDGE THAT THE EARNEST MONEY HAS BEEN AGREED UPON,
AFTER NEGOTIATION, AS THE PARTIES' REASONABLE ESTIMATE OF SELLER'S DAMAGES.

11.  SELLER'S DEFAULT.  IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE THE RETURN OF ALL EARNEST MONEY
TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND THIS AGREEMENT SHALL THEN
BECOME NULL AND VOID AND OF NO EFFECT AND THE PARTIES SHALL HAVE NO FURTHER
LIABILITY TO EACH OTHER AT LAW OR IN EQUITY, EXCEPT FOR PURCHASER'S OBLIGATIONS
TO INDEMNIFY SELLER AND RESTORE THE PROPERTY AS SET FORTH MORE FULLY IN
PARAGRAPH 7.  NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IF
SELLER'S DEFAULT IS ITS WILLFUL REFUSAL TO DELIVER THE DEED, THEN PURCHASER
WILL BE ENTITLED TO SUE FOR SPECIFIC PERFORMANCE.
<PAGE>
12.  PRORATIONS.

     12.1.  Rents (exclusive of delinquent rents [i.e. unpaid on the Closing
Date], but including prepaid rents); prepaid associations dues, refundable
security and pet deposits, if any (which will be assigned to and assumed by
Purchaser and credited to Purchaser at Closing); water and other utility
charges; fuels; prepaid operating expenses; real and personal property taxes;
and other similar items shall be adjusted ratably as of 12:01 a.m. on the
Closing Date, and credited against the balance of the cash due at Closing.
Assessments payable in installments which are due subsequent to the Closing
Date shall be paid by Purchaser.  If the amount of any of the items to be
prorated is not then ascertainable, the adjustments thereof shall be on the
basis of the most recent ascertainable data.  All prorations will be final
except as to delinquent rent referred to in Paragraph 12.2 below and except as
provided in the last sentence of this section.  All refunds of real estate
taxes relating to periods prior to the Closing Date shall be the property of,
and shall be paid to, Seller.  The parties agree to make such post-closing and
readjustments as may be required due to errors and omissions in the prorations
or due to obtaining actual amounts for items which were prorated based on
estimates within thirty (30) days after the Closing Date.

     12.2.  All rent paid following the Closing Date by any tenant of the
Property who is indebted under a lease for basic rent for any period prior to
and including the Closing Date after the payment to Purchaser of all current
rent and any past due rent owed to Purchaser shall be deemed a "Post-Closing
Receipt" until such time as all such indebtedness is paid in full.  Within ten
(10) days following each receipt by Purchaser of a Post-Closing Receipt,
Purchaser shall pay such Post-Closing Receipt to Seller.  Purchaser shall use
its best efforts to collect all amounts which, upon collection, would
constitute Post-Closing Receipts hereunder but shall have no obligation to
bring legal action.  Within 120 days after the Closing Date, Purchaser shall
deliver to Seller a reconciliation statement of Post-Closing Receipts through
the first 90 days after the Closing Date.  Upon the delivery of the
Post-Closing Receipts reconciliation, Purchaser shall deliver to Seller any
Post-Closing Receipts owing to Seller and not previously delivered to Seller in
accordance with the terms hereof.  Seller retains the right to conduct an
audit, at reasonable times and upon reasonable notice, of Purchaser's books and
records to verify the accuracy of the Post-Closing Receipts reconciliation
statement and upon the verification of additional funds owing to Seller,
Purchaser shall pay to Seller said additional Post-Closing Receipts and the
cost of performing Seller's audit.  Paragraph 12.2 of this Agreement shall
survive the Closing and the delivery and recording of the deed.

13.  RECORDING.  Neither this Agreement nor a memorandum thereof shall be
recorded and the act of recording by Purchaser shall be an act of default
hereunder by Purchaser and subject to the provisions of Paragraph 10 hereof.

14.  ASSIGNMENT.  The Purchaser shall not have the right to assign its interest
in this Agreement without the prior written consent of the Seller.  Any
assignment or transfer of, or attempt to assign or transfer, Purchaser's
interest in this Agreement shall be an act of default hereunder by Purchaser
and subject to the provisions of Paragraph 10 hereof.  Notwithstanding the
foregoing, Purchaser may assign its interest in this Agreement without the
consent of Seller to any entity in which Purchaser owns a controlling interest
or for which Purchaser is the investment advisor provided that Purchaser
remains liable for and the assignee assumes the obligations of Purchaser
hereunder with respect to indemnifications and amounts payable in the event of
<PAGE>
a termination of this Agreement, including, without limitation, damages.  Upon
such assignment, Purchaser (but not the assignee) shall be released from all
other liabilities and obligations hereunder.

15.  BROKER.  The parties hereto represent and warrant that no broker
commission or finder fee is due and payable in connection with this transaction
other than to CB Commercial Real Estate Group, Inc. ("Seller's Broker") (to be
paid by Seller).  Seller's commission to Seller's Broker shall only be payable
out of the proceeds of the sale of the Property in the event the transaction
set forth herein closes.  Purchaser and Seller shall indemnify, defend and hold
the other party hereto harmless from any claim whatsoever (including without
limitation, reasonable attorney's fees, court costs and costs of appeal) from
anyone claiming by or through the indemnifying party any fee, commission or
compensation on account of this Agreement, its negotiation or the sale hereby
contemplated other than to Seller's Broker.  The indemnifying party shall
undertake its obligations set forth in this Paragraph 15 using attorneys
selected by the indemnifying party and reasonably acceptable to the indemnified
party.  The provisions of this Paragraph 15 will survive the Closing and
delivery of the Deed.

16.  REPRESENTATIONS AND WARRANTIES.

     16.1.  Any reference herein to Seller's knowledge or notice of any matter
or thing shall only mean such actual knowledge of Mark Saturno or Reid Reynolds
(asset manager) ("Seller's Representatives") or notice that has actually been
received or sent by Seller's Representatives, and any representation or
warranty of the Seller is based upon those matters of which the Seller's
Representatives has actual knowledge or receipt.  Seller's Representatives
shall deliver a copy of the representations and warranties contained in
Paragraph 16.2 below to the existing property manager, Darlene Molner, for its
review and request the property manager inform Seller's Representative of any
inaccuracies contained in such representations and warranties.  Except as set
forth in the previous two sentences, any knowledge or notice given, had or
received by any of Seller's agents, servants or employees shall not be imputed
to Seller, the general partner or limited partners of Seller, the subpartners
of the general partner or limited partners of Seller or Seller's
Representatives. 

     16.2.  Subject to the limitations set forth in Paragraph 16.1, Seller
hereby makes the following representations and warranties, which
representations and warranties are made to Seller's knowledge and which shall,
subject to Paragraph 16.4, be remade at Closing, and shall survive Closing to
the extent set forth in Paragraph 16.5: 

     (i)  Seller has no knowledge of any pending or threatened litigation,
claim, cause of action or administrative proceeding concerning the Property,
including, without limitation, against Seller under the Fair Housing Act (42
U.S.C. Sec. 3601 et.seq., as amended); 

     (ii) Seller has the full right, power and authority to execute and deliver
this Agreement (and the documents and instruments to be executed and delivered
by Seller pursuant hereto) and consummate the transactions contemplated herein,
and this Agreement (and the documents and instruments to be executed and
delivered by Seller pursuant hereto) is the legal, valid and binding obligation
of Seller, enforceable in accordance with its terms, and does not and will not
at Closing violate or conflict with any provisions of any agreement to which
Seller is a party;
<PAGE>
     (iii)     the rent roll attached hereto as Exhibit K (the "Rent Roll")
which Seller will update as of the Closing Date is accurate and complete (but
only as to the information contained thereon) as of the date set forth thereon;

     (iv) Seller has not received written notice of any material default or
material breach on the part of the landlord under any lease shown on the Rent
Roll;

     (v)  Seller has not received written notice from any governmental
authority that the use and operation of the Property is in violation of
applicable building codes, zoning or land use laws which has not previously
been corrected;

     (vi) Seller is not a "foreign person" within the meaning of section
1445(f)(3) of the Internal Revenue Code of 1986, as amended and that Seller
will furnish to Purchaser, at or prior to Closing, an affidavit in form
satisfactory to Purchaser confirming the same;

     (vii)     Seller has no employees working at the Property;

     (viii)    There are no service contracts affecting the Property, other
than the Service Contracts listed in Exhibit G and Seller has received no
written notice of default with respect to any of the Service Contracts; 

     (ix) Except as may be set forth in the Existing Reports, Seller has not
received any written notice from any governmental authority having jurisdiction
over the Property of any uncured violation of any Environmental Law with
respect to the Property; and

     (x)  The Existing Reports are the only environmental report of the
Property provided to or obtained by Seller since November, 1993.

     16.3.  Purchaser hereby represents and warrants to Seller that Purchaser
has the full right, power and authority to execute and deliver this Agreement
and consummate the transactions contemplated herein (and the documents and
instruments to be executed and delivered by Purchaser pursuant hereto), and
this Agreement is the legal, valid and binding obligation of Purchaser,
enforceable with its terms, and does not and will not at Closing violate or
conflict with any provisions of any agreement to which Purchaser is a party.

     16.4.  If at any time after the execution of this Agreement, either
Purchaser or Seller become aware of information which makes a representation
and warranty contained in this Agreement to become untrue in any material
respect, said party shall promptly disclose said information to the other party
hereto.  Provided the party making the representation or warranty did not take
any deliberate actions to cause the representation or warranty in question to
become untrue in any material respect, said party shall not be in default under
this Agreement and the sole remedy of the other party shall be to terminate
this Agreement, except for Purchaser's obligation to indemnify Seller and
restore the Property, as more fully set forth in Paragraph 7.  Notwithstanding
anything contained herein to the contrary, if the status of any of the
tenancies changes from the date of the rent roll attached hereto and the date
of the rent roll delivered at Closing, provided the change in status is not
caused by a breach of Seller's covenants contained in Paragraph 16.6 herein,
then Purchaser shall not have the right to terminate this Agreement or make any
claim for a breach of a representation or warranty hereunder involving the rent
roll or tenancies thereunder.  Purchaser and Seller are prohibited from making
any claims against the other party hereto after the Closing with respect to any
<PAGE>
breaches of the other party's representations and warranties contained in this
Agreement that the claiming party has actual knowledge of prior to the Closing.

     16.5.     The parties agree that the representations contained herein
shall survive Closing for a period of four (4) months (i.e., the claiming party
shall have no right to make any claims against the other party for a breach of
a representation or warranty after the expiration of four (4) months
immediately following Closing).

     16.6.     Seller covenants to operate, lease, maintain and manage the
Property in the same manner that it has managed, maintained, leased and
operated the Property during the period of Seller's ownership, subject to
reasonable wear and tear and casualty.  Without limitation of the foregoing, so
long as this Agreement shall remain in effect:  Seller shall maintain Seller's
current insurance coverage presently in effect; Seller shall not enter into any
letter of intent or contract to sell the Property with any third party; Seller
shall furnish Purchaser with monthly rent rolls, delinquency reports and
operating statements as they become available; Seller agrees not to enter into
any other service contracts affecting the Property which cannot be terminated
without cause on 30 days notice, without penalty; commencing five (5) days
prior to Closing, Seller shall cooperate with Purchaser's management personnel
in arranging for a management transition; and Seller agrees to terminate any
and all management agreements affecting the Property as of the Closing Date.

     16.7.  The continued accuracy in all material respects of the aforesaid
representations and warranties shall be a condition precedent to Purchaser's
obligation to close.  If at Closing any of said representations and warranties
shall not be correct at the time the same is made in any material respect,
Purchaser may, as its sole and exclusive remedy, terminate this Agreement in
which event the earnest money shall be returned to Purchaser, including all
interest earned thereon, and there shall be no further liability of either
party to the other, except for Purchaser's obligation to indemnify Seller and
restore the Property, as more fully set forth in Paragraph 7.  

17.  LIMITATION OF LIABILITY.  None of any partners of Seller, Affiliate of
Seller or any of their respective beneficiaries, shareholders, partners,
officers, directors, agents or employees, heirs, successors or assigns shall
have any personal liability of any kind or nature for or by reason of any
matter or thing whatsoever under, in connection with, arising out of or in any
way related to this Agreement and the transactions contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability.

     Notwithstanding anything contained herein to the contrary, Purchaser
hereby agrees that the maximum aggregate liability of Seller, in connection
with, arising out of or in any way related to a breach by Seller under this
Agreement or any document or conveyance agreement in connection with the
transaction set forth herein after the Closing shall be $200,000.  Purchaser
hereby waives for itself and anyone who may claim by, through or under
Purchaser any and all rights to sue or recover from Seller any amount greater
than said limit.

18.  TIME OF ESSENCE.  Time is of the essence of this Agreement.
<PAGE>
19.  NOTICES.  Any notice or demand which either party hereto is required or
may desire to give or deliver to or make upon the other party shall be in
writing and may be personally delivered or given or made by overnight courier
such as Federal Express, by facsimile transmission or made by United States
registered or certified mail addressed as follows:

         TO SELLER:           c/o The Balcor Company
                              Bannockburn Lake Office Plaza
                              2355 Waukegan Road
                              Suite A-200
                              Bannockburn, Illinois  60015
                              Attention:  Ilona Adams

         with copies to:      The Balcor Company
                              Bannockburn Lake Office Plaza
                              2355 Waukegan Road
                              Suite A-200
                              Bannockburn, Illinois  60015
                              Attention:  Alan Lieberman
                              (708) 317-4360
                              (708) 317-4462 (FAX)

         and to:              Katten Muchin & Zavis
                              525 West Monroe Street
                              Suite 1600
                              Chicago, Illinois  60661-3693
                              Attention:  Daniel J. Perlman, Esq.
                              (312) 902-5532
                              (312) 902-1061 (FAX)

         TO PURCHASER:        RREEF Funds
                              650 California Street
                              Suite 1800
                              San Francisco, California  94109
                              Attention:  Scott M. Stuckman and Tracy DeMay
                              (415) 781-3300
                              (415) 781-2229 (FAX)

         and one copy to:     Orrick, Herrington & Sutcliffe
                              777 South Figueroa Street
                              Los Angeles, California  90017
                              Attention:  Sara H. Reynolds, Esq.
                              (213) 612-2479
                              (213) 612-2499 (FAX)

subject to the right of either party to designate a different address for
itself by notice similarly given.  Any notice or demand so given shall be
deemed to be delivered, received or made on the next business day if sent by
overnight courier, or the same day as given if sent by facsimile transmission
and received by 5:00 p.m. Chicago time or on the 4th business day after the
same is deposited in the United States Mail as registered or certified matter,
addressed as above provided, with postage thereon fully prepaid.  Any such
notice, demand or document not given, delivered or made by registered or
certified mail, by overnight courier or by facsimile transmission as aforesaid
shall be deemed to be given, delivered or made upon receipt of the same by the
party to whom the same is to be given, delivered or made.  Copies of all
notices shall be served upon the Escrow Agent.
<PAGE>
20.  EXECUTION OF AGREEMENT AND ESCROW AGREEMENT.  Purchaser will execute two
(2) copies of this Agreement and three (3) copies of the Escrow Agreement and
forward them to Seller for execution.  Within one (1) business day of receipt
of a fully executed copy (which may be transmitted by telecopy or to
Purchaser's attorney) of this Agreement, Purchaser shall wire transfer the
Earnest Money to the Escrow Agent set forth in the Escrow Agreement.  Seller
will forward one (1) copy of the executed Agreement to Purchaser and will
forward the following to the Escrow Agent:

     (A)  One (1) fully executed copy of this Agreement; and

     (B)  Three (3) copies of the Escrow Agreement signed by the parties with a
direction to execute two (2) copies of the Escrow Agreement and deliver a fully
executed copy to each of the Purchaser and the Seller.

21.  GOVERNING LAW.  The provisions of this Agreement shall be governed by the
laws of the California, except that with respect to the retainage of the
Earnest Money as liquidated damages the laws of the State of Illinois shall
govern.

22.  ENTIRE AGREEMENT.  This Agreement constitutes the entire agreement between
the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.

23.  COUNTERPARTS.  This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.

24.  CAPTIONS.  Paragraph titles or captions contained herein are inserted as a
matter of convenience and for reference, and in no way define, limit, extend or
describe the scope of this Agreement or any provision hereof.

25.  CONDITION PRECEDENT.  Subject to the remedies available to the parties
hereunder in the event of a default, it is a condition precedent to Seller's
and Purchaser's obligations to perform under this Agreement that Purchaser
acquire that certain property commonly known as Sand Pebble Village I
Apartments (the "Other Property") in accordance with the terms of the Agreement
of Sale (the "Other Property Contract") between Pebble Sand Limited Partnership
("Other Property Seller") and Purchaser of even date herewith for the sale of
the Other Property to Purchaser.  The purchase and sale of the Property and the
purchase and sale of the Other Property shall occur simultaneously.

     The occurrence of a default by Purchaser under the Other Property Contract
shall constitute an event of default by Purchaser under this Agreement and the
occurrence of a default by Purchaser under this Agreement shall constitute an
event of default by Purchaser under the Other Property Contract.  If Seller
defaults under this Agreement, Purchaser shall have the right to elect to
terminate the Other Property Contract and in such event Purchaser shall be
entitled to receive all earnest money deposited pursuant to the Other Property
Contract and all interest earned thereon.  If Seller defaults under the Other
Property Contract, Purchaser shall have the right to elect to terminate the
Contract and in such event Purchaser shall be entitled to receive all earnest
money deposited pursuant hereto and all interest earned thereon.  
<PAGE>
     If Purchaser terminates this Agreement pursuant to Section 7 hereof, or
pursuant to any other section of this Agreement, the Purchaser shall also be
deemed to have terminated the Other Property Contract.  Similarly, if Purchaser
terminates the Other Property Contract pursuant to Paragraph 7 thereof or any
other section of the Other Property Contract, Purchaser shall also be deemed to
have terminated this Agreement.

     IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of
the date first set forth above.


                              PURCHASER:

                              RREEF AMERICA L.L.C., a Delaware limited
                              liability company

                              By: /s/Scott M. Stuckman
                                 ------------------------------
                              Name: Scott M. Stuckman
                                   ----------------------------
                              Its: Authorized Representative
                                  -----------------------------


                              SELLER:

                              3957 PIERCE LIMITED PARTNERSHIP, an Illinois
                              limited partnership

                              By:  3957 Pierce, Inc., an Illinois corporation,
                                   its general partner


                                   By: /s/Alan G. Lieberman
                                      -------------------------------
                                   Name: Alan G. Lieberman
                                        -----------------------------
                                   Its: Senior Vice President
                                       ------------------------------
<PAGE>
                of CB Commercial Real Estate Group, Inc. ("Seller's Broker")
executed this Agreement in its capacity as a real estate broker and
acknowledges that the fee or commission due it from Seller as a result of the
transaction described in this Agreement is as set forth in that certain Listing
Agreement, dated __, 199_ between Seller and Seller's Broker (the "Listing
Agreement").  Seller's Broker also acknowledges that payment of the aforesaid
fee or commission is conditioned upon the Closing and the receipt of the
Purchase Price by the Seller.  Seller's Broker agrees to deliver a receipt to
the Seller at the Closing for the fee or commission due Seller's Broker and a
release, in the appropriate form, stating that no other fees or commissions are
due to it from Seller or Purchaser.

                              CB Commercial Real Estate Group, Inc.



                              By:__________________________________
<PAGE>
                                   Exhibits

A    -    Legal

B    -    Personal Property

C    -    Escrow Agreement

D    -    Deed

E    -    Bill of Sale

F    -    Assignment and Assumption of Intangible Property

G    -    Service Contracts

H    -    Assignment and Assumption of Leases and Security Deposits

I    -    Non-Foreign Affidavit

J    -    Notice to Tenants

K    -    Rent Roll
<PAGE>

                               AGREEMENT OF SALE


     THIS AGREEMENT, entered into as of the 15th day of July, 1996, by and
between ERP OPERATING LIMITED PARTNERSHIP, an Illinois limited partnership
("Purchaser") and WOODSCAPE LIMITED PARTNERSHIP, an Illinois limited
partnership ("Seller").

                                  WITNESSETH:

     1.   PURCHASE AND SALE.  Purchaser agrees to purchase and Seller agrees to
sell at the price of NINE MILLION FIVE HUNDRED FIFTY THOUSAND and No/100
Dollars ($9,550,000.00), that certain property ("Property") in Raleigh, North
Carolina more particularly described on Exhibit A attached hereto, which
Property is known as Woodscape Apartments and contains 240 units and
approximately 27 acres.  Included in the "Purchase Price" (as hereinafter
defined) is all of Seller's right, title and interest in the personal property
set forth on Exhibit B, which shall be transferred to Purchaser at "Closing"
(as hereinafter defined) by a Bill of Sale; and all right, title and interest
of Seller (whether now or hereafter existing) in and to any land lying in the
bed of any street, alley, road or avenue (whether open, closed or proposed)
within, in front of, behind or otherwise adjoining the Property or any of it;
and all right, title and interest of Seller (whether now or hereafter existing)
in and to any award made or to be made as a result of or in lieu of
condemnation, and in and to any award for damage to the Property or any part
thereof by reason of casualty (all of the foregoing being included within the
term "Property"); and all of the building, structures, fixtures, facilities,
installations and all of Seller's right, title and interest in other
improvements of every kind and description now or hereafter in, on, over and
under the land, including, without limitation, any and all recreational
buildings, structures and facilities, plumbing, air conditioning, heating,
ventilating, mechanical, electrical and other utility systems, parking lots,
landscaping, sidewalks, swimming pools, signs and light fixtures which are not
owned by tenants under leases (all of the foregoing being included within the
term "Property"); and all of Seller's right, title and interest in all of the
following which are in Seller's possession: existing surveys, blue prints,
drawings, plans and specifications (including, without limitation, structural,
HVAC, mechanical and plumbing, water and sewer plans and specifications); all
available tenant lists and data, correspondence with present and prospective
tenants, vendors, suppliers, utility companies and other third parties,
booklets, manuals and promotional and advertising materials concerning the
Property or any part thereof (all of the foregoing being included within the
term "Property"); and all right, title and interest of Seller in and to the
intangible personal property now or hereafter owned by Seller and used in
connection with or arising from the business now or hereafter conducted on or
from the Property or any part thereof, including, without limitation, claims,
choses in action, lease and other contract rights, names and telephone exchange
numbers (all of the foregoing being included within the term "Property").  The
computer software located at the Property is not included in the conveyance to
Purchaser.
<PAGE>
     2.   PURCHASE PRICE.  The purchase price (the "Purchase Price") shall be
paid as follows:

          A.   Upon the execution of this Agreement, the sum of $300,000.00 
     ("Earnest Money") to be held in escrow by the Escrow Agent (as that term 
     is defined in the "Escrow Agreement" [as hereinafter defined]) by and in 
     accordance with the provisions of the Escrow Agreement ("Escrow 
     Agreement") attached hereto as Exhibit C; 

          B.   On the "Closing Date" (as hereinafter defined), the balance of 
     the Purchase Price adjusted in accordance with the prorations by federally
     wired "immediately available" funds delivered to the "Title Insurer" (as 
     hereinafter defined) no later than 12:00 Noon on the Closing Date.  If the
     funds are not received by 12:00 Noon, then, on the Closing Date, Purchaser
     shall pay Seller an amount equal to any additional mortgage per diem 
     interest costs incurred by the Seller.

     3.   TITLE COMMITMENT AND SURVEY.

     A.  Seller has ordered a title commitment (the "Title Commitment") for an
ALTA Owner's Policy of Title Insurance ("Title Policy") issued by Commonwealth
Land Title Insurance Company (the "Title Insurer") along with copies of all of
the underlying Schedule B documents.  Seller will deliver the Title Commitment
and copies of the underlying Schedule B documents to Purchaser promptly
following their receipt by Seller.  During the Approval Period Purchaser shall
have the right to review the status of title of the Property (including,
determining what endorsements, if any, the Title Insurer will make available to
Purchaser).  If, prior to the expiration of the Approval Period, Purchaser
notifies Seller that Purchaser objects to the status of title, then Seller
shall have five (5) business days thereafter to elect to (i) terminate this
Agreement, in which case the Earnest Money, including interest thereon, shall
be returned to Purchaser immediately following Seller's receipt of the
"Reports" (as hereinafter defined) or (ii) agree to cure the title objections
identified by Purchaser, which cure may be effectuated by causing the Title
Insurer, at Seller's expense, to insure over any title objection, if
applicable.  If this Agreement has not been theretofore terminated, then
promptly following the Approval Period, Purchaser and Seller will identify the
exceptions to title which have been agreed to by Purchaser and Seller.  Said
exceptions to title are hereinafter referred to as the "Permitted Exceptions".
On the Closing Date, Seller shall cause the Title Insurer to issue the Title
Policy or a "marked up" commitment in conformity with the Title Commitment
subject only to Permitted Exceptions or "Unpermitted Exceptions" (as
hereinafter defined) which have been waived by Purchaser.  If the Title Policy
or marked-up commitment delivered at Closing discloses exceptions to title
other than Permitted Exceptions, then Purchaser may terminate this Agreement
and obtain a return of its Earnest Money, including interest thereon.  Seller
shall pay for the costs of the Title Policy and all endorsements.

          B.   Purchaser acknowledges receipt of a survey ("Survey") of the
Property prepared by Bass Nixon & Kennedy dated March 10, 1980.  Seller has
ordered an updated Survey ("Updated Survey").  Purchaser shall have ten (10)
days from the date of receipt of the Updated Survey to approve the Updated
<PAGE>
Survey.  If Purchaser disapproves the Updated Survey because it contains
matters which are not acceptable to Purchaser ("Survey Defects"), then upon
notice delivered to Seller by Purchaser within ten (10) days from the date of
receipt of the Updated Survey, Seller shall have five (5) days to either: (i)
cause the Survey Defects to be removed from the Updated Survey or (ii) cause
the title Insurer to insure against loss or damage resulting from the Survey
Defects ("Title Indemnity").  If Seller is unwilling to do either (i) or (ii)
above, then Purchaser shall have the right to elect to terminate this
Agreement.  Purchaser shall notify Seller of its election within five (5) days
after receipt of notice from Seller that the Survey Defects will not be removed
or that the Title Insurer will not issue the Title Indemnity.  If Purchaser
fails to make the election within the aforesaid five (5) days, then it shall be
conclusively presumed that Purchaser elects to terminate this Agreement
pursuant to this Paragraph, then the Earnest Money plus all accrued interest
shall be delivered to Purchaser immediately following Seller's receipt of the
Reports.

     4.   CONDITION OF TITLE/CONVEYANCE.  Seller agrees to convey fee simple
title to the Property by Special Warranty Deed in the form of Exhibit D
attached hereto (the "Deed") in recordable form subject only to the Permitted
Exceptions.  If Seller is unable to convey title to the Property subject only
to the Permitted Exceptions because of the existence of an additional title
exception ("Unpermitted Exception"), then Purchaser can elect to take title to
the Property subject to the Unpermitted Exception or terminate this Agreement.
Notwithstanding the aforesaid, Seller shall be required to remove all
Unpermitted Exceptions which are liens of a definite or ascertainable amount.
If Purchaser elects to terminate this Agreement, then the Earnest Money plus
all accrued interest shall be delivered to the Purchaser.

     5.   PAYMENT OF CLOSING COSTS.  Seller shall pay the costs of the
documentary stamps (if any) to be paid with reference to the Deed and all other
stamps, intangible, documentary, recording, sales tax and surtax imposed by law
with reference to any other documents delivered in connection with this
Agreement as well as for all costs of the Title Commitment, Title Policy, the
Survey, Updated Survey, escrow charges and all other charges of the Title
Insurer in connection with this transaction.  Purchaser and Seller shall be
responsible for the costs of their respective attorneys.

     6.   DAMAGE, CASUALTY AND CONDEMNATION.

          A.   If the Property suffers damage as a result of any casualty prior
to the Closing Date and can be repaired or restored in the case of real
property for $95,000 or less, or in the case of Personal Property, for
$25,000.00 or less, as determined by Seller in good faith, then Seller shall
either repair such damage prior to Closing or, at Purchaser's option (which
shall be exercised by Purchaser within ten (10) days after notice of such
casualty), allow Purchaser a credit against the Purchase Price in an amount
equal to the reasonably estimated cost of repair.  Seller shall retain all
insurance proceeds.  If the cost of repair or restoration exceeds the aforesaid
amounts (as determined by Seller in good faith), then Purchaser can, upon
notice to Seller within ten (10) days after notice of such casualty, elect to
<PAGE>
either: (a) cause Seller to repair and restore same, in which event the Closing
Date will be extended until such date as may reasonably be required to complete
the repair or restoration; or (b) terminate this Agreement upon notice to
Seller served within ten (10) days of notice of such casualty or (c) accept the
Property in its damaged condition together with an assignment from Seller of
all insurance proceeds and receive a credit at Closing in the amount of the
deductible.

          B.   If condemnation proceedings ("Proceedings") have been instituted
against the Property and such Proceedings are in an amount less than $100,000,
then Purchaser shall take the Property subject to the Proceedings and an
assignment of Seller's interest in the Proceedings.  If the Proceedings are in
excess of $100,000.00, then Purchaser can elect to either take the Property
subject to the Proceedings and an assignment of Seller's interest in the
Proceedings or terminate this Agreement.  If Purchaser elects to terminate this
Agreement, it shall be by notice to the Seller within five (5) days after
Seller notifies Purchaser of the Proceedings.

          C.   If the Agreement is terminated pursuant to this Paragraph, then
the Earnest Money plus all accrued interest shall be delivered to the
Purchaser.

     7.   AS-IS CONDITION.

          A.   Except as may hereinafter be specifically set forth in this
Agreement, Purchaser is not relying on Seller having made any inquiry as to the
condition of the Property or the leases.  Purchaser acknowledges and agrees
that, except as may hereinafter be specifically set forth in this Agreement, it
will be purchasing the Property based solely upon its inspection and
investigations of the Property and that Purchaser will be purchasing the
Property "AS IS" and "WITH ALL FAULTS" based upon the condition of the Property
as of the date of this Agreement, subject to reasonable wear and tear and loss
by fire or other casualty or condemnation from the date of this Agreement until
the Closing Date.  Without limiting the foregoing, Purchaser acknowledges that,
except as may otherwise be specifically set forth elsewhere in this Agreement,
neither Seller nor its consultants, brokers or agents have made any other
representations or warranties of any kind upon which Purchaser is relying as to
any matters concerning the Property, including, but not limited to, the
condition of the land or any improvements, the existence or nonexistence of
asbestos, lead in water, lead in paint, radon, underground or above ground
storage tanks, petroleum, toxic waste or any "Hazardous Materials" or
"Hazardous Substances" (as such terms are defined below), the tenants of the
Property or the leases affecting the Property, economic projections or market
studies concerning the Property, any development rights, taxes, bonds,
covenants, conditions and restrictions affecting the Property, water or water
rights, topography, drainage, soil, subsoil of the Property, the utilities
serving the Property or any zoning, environmental or building laws, rules or
regulations affecting the Property.  Seller makes no representation that the
Property complies with Title III of the Americans With Disabilities Act and,
except as may hereinafter be specifically set forth in this Agreement, Seller
makes no representation that the Property complies with any fire codes or
building codes.  Purchaser hereby releases Seller from any and all liability in
connection with any claims which Purchaser may have against Seller, and
<PAGE>
Purchaser hereby agrees not to assert any claims, for damage, loss,
compensation, contribution, cost recovery or otherwise, against Seller, whether
in tort, contract, or otherwise, relating directly or indirectly to the
existence of asbestos or Hazardous Materials or Hazardous Substances on, or
environmental conditions of, the Property, or arising under the "Environmental
Laws" (as such term is hereinafter defined), or relating in any way to the
quality of the indoor or outdoor environment at the Property.  This release
shall survive the Closing.  As used herein, the term "Hazardous Materials" or
"Hazardous Substances" means (i) hazardous wastes, hazardous materials,
hazardous substances, hazardous constituents, toxic substances or related
materials, whether solids, liquids or gases, including but not limited to
substances defined as "hazardous wastes," "hazardous materials," "hazardous
substances," "toxic substances," "pollutants," "contaminants," "radioactive
materials," or other similar designations in, or otherwise subject to
regulation under, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended ("CERCLA"), 42 U.S.C. Section 9601 et seq.;
the Toxic Substance Control Act ("TSCA"), 15 U.S.C. Section 2601 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1802; the Resource
Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section 9601, et seq.; the
Clean Water Act ("CWA"), 33 U.S.C. Section 1251 et seq.; the Safe Drinking
Water Act, 42 U.S.C. Section 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C.
Section 7401 et seq.; and in any permits, licenses, approvals, plans, rules,
regulations or ordinances adopted, or other criteria and guidelines promulgated
pursuant to the preceding laws or other similar federal, state or local laws,
regulations, rules or ordinance now or hereafter in effect relating to
environmental matters (collectively the "Environmental Laws"); and (ii) any
other substances, constituents or wastes subject to any applicable federal,
state or local law, regulation or ordinance, including any Environmental Law,
now or hereafter in effect, including but not limited to (A) petroleum, (B)
refined petroleum products, (C) waste oil, (D) waste aviation or motor vehicle
fuel, (E) asbestos, (F) lead in water, paint or elsewhere, (G) radon, (H)
Polychlorinated Biphenyls (PCB's) and (I) ureaformaldehyde.

          B.   Seller has provided to Purchaser certain unaudited historical
financial information regarding the Property relating to certain periods of
time in which Seller owned the Property.  Seller and Purchaser hereby
acknowledge that such information has been provided to Purchaser at Purchaser's
request solely as illustrative material.  Except as may hereinafter be
specifically set forth in this Agreement, Seller makes no representation or
warranty that such material is complete or accurate or that Purchaser will
achieve similar financial or other results with respect to the operations of
the Property, it being acknowledged by Purchaser that Seller's operation of the
Property and allocations of revenues or expenses may be vastly different than
Purchaser may be able to attain.  Purchaser acknowledges that it is a
sophisticated and experienced purchaser of real estate and further that
Purchaser has relied upon its own investigation and inquiry with respect to the
operation of the Property and releases Seller from any liability with respect
to such historical information.

     8.   CLOSING.  The closing ("Closing") of this transaction shall be on
August 30, 1996 ("Closing Date"), at the office of the Seller's attorney, at
which time Seller shall deliver possession of the Property to Purchaser.
<PAGE>
     9.   CLOSING DOCUMENTS.

          A.   On the Closing Date, Purchaser shall deliver to Seller an
executed closing statement, the balance of the Purchase Price, and such other
documents as may be reasonably required in order to consummate the transaction
as set forth in this Agreement.

          B.   On the Closing Date, Seller shall deliver to Purchaser
possession of the Property; the Deed subject to the Permitted Exceptions and
those Unpermitted Exceptions waived by Purchaser; a UCC search from appropriate
jurisdictions reflecting no liens against Seller, or a termination statement as
to any lien secured by a UCC filing; an inventory of the Personal Property and
a Bill of Sale for the same (in the form of Exhibit E attached hereto); an
executed closing statement; an executed assignment and assumption of all
service contracts (in the form of Exhibit F attached hereto); an executed
assignment and assumption of all leases and security deposits (in the form of
Exhibit G attached hereto); updated rent roll; a notice to the tenants of the
transfer of title and the assumption by Purchaser of the landlord's obligations
under the leases and the obligation to refund the security deposits (in the
form of Exhibit H attached hereto), the original leases to be delivered to
Purchaser at the Property; a non-foreign affidavit (in the form of Exhibit I
attached hereto) and such other documents as may be reasonably required by the
Title Insurer in order to consummate the transaction as set forth in this
Agreement and shall cause the Title Company to deliver the Title Policy subject
only to Permitted Exceptions and Unpermitted Exceptions waived by Purchaser. 

     10.  DEFAULT BY PURCHASER.  ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS
TO SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND
UNDERTAKINGS UNDER THIS AGREEMENT.  IN THE EVENT THIS TRANSACTION FAILS TO
CLOSE DUE TO THE DEFAULT OF THE PURCHASER UNDER THE PROVISIONS OF THIS
AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND THE INTEREST
THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY.  THE PARTIES
HAVE AGREED THAT SELLER'S ACTUAL DAMAGES, IN THE EVENT OF A DEFAULT BY
PURCHASER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO DETERMINE.
THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES ACKNOWLEDGE THAT THE
EARNEST MONEY HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES'
REASONABLE ESTIMATE OF SELLER'S DAMAGES.

     11.  SELLER'S DEFAULT.  IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE ACTUAL DAMAGES NOT TO EXCEED THE
AMOUNT OF THE EARNEST MONEY THEN ON DEPOSIT WITH THE ESCROW AGENT, PLUS THE
RETURN OF ALL EARNEST MONEY TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND
THIS AGREEMENT SHALL TERMINATE AND THE PARTIES SHALL HAVE NO FURTHER LIABILITY
TO EACH OTHER AT LAW OR IN EQUITY.  NOTWITHSTANDING ANYTHING CONTAINED HEREIN
TO THE CONTRARY, IF SELLER'S DEFAULT IS ITS REFUSAL TO DELIVER THE DEED, THEN
PURCHASER WILL BE ENTITLED TO SUE FOR SPECIFIC PERFORMANCE.

     12.

          A.   PRORATIONS.  Rents for the month of the Closing (exclusive of
delinquent rents, but including prepaid rents); any previously paid signing
bonus or similar payment relating to any laundry room, cable, telephone or
similar agreement in effect as of the Closing, refundable security deposits
<PAGE>
with interest if required by local law (which will be assigned to and assumed
by Purchaser and credited to Purchaser at Closing); refundable and
non-refundable pet and cleaning fees and deposits, water and other utility
charges; fuels; prepaid operating expenses; real and personal property taxes
(as provided for in the next following sentence); and other similar items shall
be adjusted ratably as of 11:59 P.M. on the Closing Date ("Proration Date"),
and credited or debited to the balance of the cash due at Closing.  Real
property taxes shall be prorated based on the current year tax bill if
available and if the current year tax bill is not available, then real property
taxes shall be prorated based on an assessed valuation of the Property of
$6,398,000 and a tax rate equal to 102% of the tax rate for the 1995 calendar
year.  In addition, the parties shall prorate any applicable waste fees.

     All prorations will be final except as to Delinquent Rents referred to in
12B below, and errors in calculation on the closing statement.  If special
assessments have been levied against the Property for completed improvements,
then the amount of any installments which are due prior to the Closing Date
shall be paid by the Seller; and the amount of installments which are due after
the Closing Date shall be paid by the Purchaser.  All assessments for
incomplete improvements shall be paid by Purchaser.

          B.   DELINQUENT RENTS.  If, as of the Closing Date, any rent is in
arrears ("Delinquent Rent") for thirty (30) days or less, then the first rent
collected by Purchaser will be delivered to Seller for the Delinquent Rent.  If
Delinquent Rent is in arrears for more than thirty (30) days, then rents
collected by Purchaser shall first be applied to current rent and then to
Delinquent Rent.  Purchaser shall deliver Seller's pro rata share within 10
days of Purchaser's receipt of that Delinquent Rent.  Within 120 days after the
Closing Date, Purchaser shall deliver to Seller a reconciliation statement of
rents collected by Purchaser through the first 90 days after the Closing Date.
Seller retains the right to conduct an audit, at reasonable times and upon
reasonable notice, of Purchaser's books and records to verify the accuracy of
the reconciliation statement and if such audit discloses that additional funds
are owing , then the party owing such funds shall promptly pay such sums to the
party so owed.  This subparagraph of this Agreement shall survive the Closing
and the delivery and recording of the Deed.

     13.  RECORDING.  This Agreement shall not be recorded and the act of
recording by Purchaser shall be an act of default hereunder by Purchaser and
shall be subject to the provisions of Paragraph 10.

     14.  ASSIGNMENT.  The Purchaser shall not have the right to assign its
interest in this Agreement without the prior written consent of the Seller,
except to an entity directly or indirectly controlled by Purchaser.  Any
non-permitted assignment or transfer of, or attempt to assign or transfer,
Purchaser's interest in this Agreement shall be an act of default hereunder by
Purchaser and subject to the provisions of Paragraph 10.  Seller hereby
consents to an assignment to an entity which is an affiliate of Purchaser,
provided Purchaser notifies Seller of the assignment at least five (5) business
days prior to the Closing Date.
<PAGE>
     15.  BROKER.    The parties hereto hereby each represent and warrant to
the other that neither has retained the services of a broker in connection with
this transaction except for CB Commercial Real Estate Group, Inc. ("CB")
retained by Seller and whose commission will be paid by Seller.  Purchaser
agrees to indemnify, defend and hold harmless the Seller and any partner,
affiliate, parent of Seller, and all shareholders, employees, officers and
directors of Seller or Seller's partner, parent or affiliate (each of the above
is individually referred to as a "Seller Indemnitee") from all claims,
including attorneys' fees and costs incurred by a Seller Indemnitee as a result
of anyone's claiming by or through Purchaser any fee, commission or
compensation on account of this Agreement, its negotiation or the sale hereby
contemplated (except for CB).  Seller agrees to indemnify, defend and hold
harmless the Purchaser and any partner, affiliate, parent of Purchaser and all
shareholders, employees, officers and directors of Purchaser or Purchaser's
parent or affiliate (each of the above is individually referred to as a
"Purchaser Indemnitee") from all claims, including attorneys' fees and costs
incurred by a Purchaser Indemnitee as a result of anyone's claiming by or
through Seller any fee, commission or compensation on account of this
Agreement, its negotiation or the sale hereby contemplated.

     16.  DOCUMENTS, INSPECTION OF PROPERTY AND APPROVAL PERIOD.

          A.   Seller has delivered to Purchaser copies of the most recent
available tax bills, rent rolls, insurance premiums, service contracts, utility
account numbers, year-end 1995 and year-to-date 1996 operating statements
(collectively the "Documents").  All of the Documents shall be subject to
approval by Purchaser by the close of business (5:00 P.M. Central Daylight
Time) on August 9, 1996 ("Approval Period").  During the Approval Period, upon
reasonable notice to the Seller, the Purchaser shall have the right to inspect
and approve the condition of the Property including the interior of the
apartments, during normal business hours.  Purchaser shall maintain public
liability insurance policies insuring against claims arising as a result of the
inspections of the Property being conducted by Purchaser.  Purchaser agrees to
indemnify, defend, protect and hold Seller harmless from any and all loss,
costs, including attorneys' fees, liability or damages which Seller may incur
or suffer as a result of Purchaser's conducting its inspection and
investigation of the Property including the entry of Purchaser, its employees
or agents and its lender onto the Property, including without limitation,
liability for mechanics' lien claims.

          B.   Purchaser agrees to defend and hold Seller harmless from any
injuries, damages or claims of any nature whatsoever which Purchaser's
servants, agents or employees may have as a result of Purchaser's inspection of
the Property.  Purchaser further agrees to restore any damage to the Property
which may arise as a result of Purchaser's inspection of the Property.

          C.   If Purchaser disapproves the Documents or the condition of the
Property, in its sole and absolute discretion, it must be by a notice ("Notice
of Disapproval") delivered to Seller and the Escrow Agent prior to the
expiration of the Approval Period.  The Notice of Disapproval delivered to
Seller shall be accompanied by copies of all third-party reports ("Reports")
which Purchaser has received during the Approval Period.  Upon receipt of the
Notice of Disapproval and copies of the Reports, the Earnest Money plus the
<PAGE>
interest accrued thereon shall be returned to the Purchaser.  If Purchaser does
not timely deliver a Notice of Disapproval and copies of the Reports to Seller,
then it shall be conclusively presumed that Purchaser has approved the
Documents and the condition of the Property and all Earnest Money plus the
interest accrued thereon shall belong to Seller unless Seller is in default
hereunder.
 
     17.  SURVIVAL OF INDEMNITY.  Notwithstanding anything in this Agreement to
the contrary, the parties' obligations to indemnify, defend and hold each other
harmless under various provisions of this Agreement shall forever survive the
termination of this Agreement or the Closing and delivery and recording of the
Deed.

     18.  SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS.

          A.   Any reference herein to Seller's knowledge, representation,
warranty or notice of any matter or thing, shall only mean such knowledge or
notice that has actually been received by Alan Lieberman and Phillip Schechter,
and any representation or warranty of the Seller is based upon those matters of
which Alan Lieberman and Phillip Schechter have actual knowledge.  A copy of
this Paragraph 18 shall be delivered to the resident manager of the Property
within two (2) days after the execution by Seller of this Agreement, with a
request to advise Phillip Schechter within five (5) business days after receipt
by the resident manager as to the accuracy and truthfulness of the
representations and warranties.  Phillip Schechter shall notify Purchaser as to
the response of the resident manager by July 22, 1996 if the resident manager
indicated that any of the representations or warranties were incorrect.  If Mr.
Schechter fails to so notify Purchaser, Purchaser shall be entitled to conclude
that the resident manager reviewed the representations and warranties and that
they are correct.  Any knowledge or notice given, had or received by any of
Seller's agents, servants or employees shall not be imputed to Seller or the
individual partners or the general partner of Seller.

          B.   Subject to the limitations set forth in subparagraph "A" above,
Seller hereby makes the following representations and warranties, all of which
are made to the Seller's knowledge.  The parties agree that the representations
contained herein shall survive Closing for a period of 120 days (i.e. the
claiming party shall have no right to make any claims against the other party
for a breach of a representation or warranty after the expiration of 120 days
immediately following Closing.)

               (1)  Except as set forth on Exhibit J attached hereto, the 
     present use and occupancy of the Property conform with applicable building
     and zoning laws and Seller has received no written notice that any such 
     laws, rules or regulations are being violated.

               (2)  The rent roll attached hereto as Exhibit K and which shall 
     be updated as of the Closing Date is true and accurate.  No tenant under 
     any lease has any option or right of first refusal to acquire any 
     ownership interest in the Property or any right to terminate its lease or 
     is entitled to any rebate or concession except as set forth in its lease 
     or on Exhibit K.
<PAGE>
               (3)  Except as set forth on Exhibit J attached hereto, Seller 
     has no knowledge of any pending or threatened litigation, claim, cause of 
     action or administrative proceeding concerning the Property.

               (4)  Attached hereto as Exhibit L are copies of all licenses and
     permits which are in Seller's possession and all service contracts 
     affecting the Property (none of which is in default), except for the 
     management agreement which shall be terminated as of the Closing Date; and
     Seller shall not enter into any new service contracts which cannot be 
     terminated within 30 days written notice or modify or extend any existing 
     service contracts without the prior consent of Purchaser which consent 
     shall not be unreasonably withheld or delayed.

               (5)  Seller has not received any written notice from any tenant 
     occupying the Property that Seller is in default under that tenant's 
     lease.

               (6)  Except as set forth on Exhibit K attached hereto, Seller 
     has not received from any governmental authority, any written notice of 
     zoning, building, fire, health code or other violations with respect to 
     the Property, or any part thereof, that will not have been corrected prior
     to Closing solely at Seller's expense.

               (7)  Seller is duly organized, validly existing, qualified and 
     empowered to conduct its business, and has full power and authority to 
     perform and comply with the terms of this Agreement.  Neither the 
     execution and delivery of this Agreement nor its performance will conflict
     with or result in the breach of Seller's partnership agreement or any 
     contract or agreement to which Seller is a party or by which Seller is 
     bound.

               (8)  This Agreement is valid and enforceable against Seller in 
     accordance with its terms and each instrument to be executed by Seller 
     pursuant to this Agreement or in connection herewith will, when executed 
     and delivered, be valid and enforceable against Seller in accordance with 
     its terms.

               (9)  Seller has not received written notice from any 
     governmental authority alleging that the Property presently contains 
     Hazardous Materials or Hazardous Substances.

               (10) As of the Closing Date, no leasing commissions will be due 
     subsequent to the Closing Date.

               (11) None of the on-site employees is employed by the Seller.

               (12) Through the Closing Date, Seller shall continue to operate,
     manage and maintain the Property in the same manner as prior to the 
     execution of this Agreement.

               (13) Seller shall not extend or otherwise renew any lease 
     without the prior written consent of Purchaser, except for any renewal or 
     other extension of a lease providing for a monthly rental of not less than
     the monthly rental being presently charged for a similar apartment and for
     a period of time not to exceed twelve (12) months.
<PAGE>
               (14) Seller agrees not to distribute the net proceeds of the 
     Purchase Price up to a maximum amount of $500,000  to its partners for one
     hundred twenty (120) days after the Closing Date.

               (15) Exhibit B attached hereto is a list of all the personal 
     property owned by Seller and used in the operation of the Property.  The 
     computer software used at the Property will not be transferred to the 
     Purchaser.

               (16) The unaudited operating statements heretofore or hereafter 
     delivered to Purchaser by Seller are and shall be true, complete and 
     correct in all material respects.

          C.   For the period commencing with the execution of this Agreement,
and expiring at the earlier of a termination of this Agreement or the Closing
Date, Seller will not offer the Property for sale to any other third party.

          D.   Seller shall furnish to Purchaser unaudited operating
statements, rent rolls and a leasing status report on a monthly basis.

          E.   Upon at least two (2) days' prior notice, Purchaser shall have
the right, during normal business hours, to visit the Property and the
interiors of the apartments.

          F.   Seller shall not apply security deposits towards delinquent rent
except for (i) those tenants who have vacated their apartments or (ii) tenants
who are in arrears for rent for more than thirty (30) days and Seller has
commenced the process of evicting the tenant.

          G.   Seller hereby agrees to remake the aforesaid representations and
warranties at Closing.  If at any time after the execution of this Agreement,  
Seller becomes aware of information which makes a representation or warranty
contained in this Agreement to become untrue in any material respect, Seller
shall promptly disclose said information to Purchaser.  Provided the
representation or warranty was true when made and further provided that Seller
did not take any deliberate actions to cause the representation or warranty in
question to become untrue in any material respect, Seller shall not be in
default under this Agreement and the sole remedy of Purchaser shall be to
terminate this Agreement.   Notwithstanding anything contained herein to the
contrary, if the status of any of the tenancies changes from the date of the
rent roll attached hereto and the date of the rent roll delivered at Closing,
provided the change in status is not caused by a breach of Seller's covenants
contained herein, then Purchaser shall not have the right to terminate this
Agreement or make any claim for a breach of a representation or warranty
hereunder involving the rent roll or tenancies thereunder.  Purchaser and
Seller are prohibited from making any claims against the other party hereto
after the Closing with respect to any breaches of the other party's
representations and warranties contained in this Agreement that the claiming
party had actual knowledge of prior to Closing.
<PAGE>
     19.  PURCHASER'S REPRESENTATIONS AND WARRANTIES.  Purchaser hereby
represents and warrants to Seller that Purchaser has the full right, power and
authority to execute this Agreement and consummate the transactions
contemplated herein.

     20.  ENVIRONMENTAL REPORT.  Attached to this Agreement as Exhibit M are
the following reports (together, the "Existing Reports") of the Property, which
Seller is delivering to Purchaser, at Purchaser's request:  Phase I
Environmental Site Assessment and Limited Asbestos Survey prepared by Law
Associates, Inc. dated July 24, 1991 under Project No. 1391-2075-01.  Seller
makes no representation or warranty that the Existing Reports are accurate or
complete.  Purchaser hereby releases Seller from any liability whatsoever with
respect to the Existing Reports or, including, without limitation, the matters
set forth in the Existing Reports, the accuracy and/or completeness of the
Existing Reports.

     21.  LIMITATION OF SELLER'S LIABILITY.  No general or limited partner of
Seller, nor any of its respective beneficiaries, shareholders, partners,
officers, agents, employees, heirs, successors or assigns shall have any
personal liability of any kind or nature for or by reason of any matter or
thing whatsoever under, in connection with, arising out of or in any way
related to this Agreement and the transactions contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability.  Notwithstanding the foregoing to the contrary, for
any claims against Seller following Closing, if Seller fails to retain the net
proceeds of the Purchase Price up to a maximum amount of $500,000 (the "Cap")
for 120 days after the Closing Date, then the general partner of Seller shall
be liable for actual damages sustained by Purchaser as a result of Seller's
breach of a representation or warranty contained in Paragraph 18 of this
Agreement in an amount not to exceed the Cap.  The foregoing Cap on liability
for a claim against the Seller following Closing shall not apply, and Seller's
general partner shall be liable, if Seller has entered into leases at the
Property for more than one year in breach of the representation identified in
Paragraph 18(B)(2) hereof and Purchaser makes a claim against Seller for a
breach of said representation within 120 days immediately following Closing.

     22.  ORGANIZATIONAL DOCUMENTS.

          A.   On or before the Closing Date, Purchaser will provide Seller's
attorney with copies of its organizational documents, including a certified
copy of its recorded certificate of limited partnership and a true copy of its
Partnership Agreement or a certified copy of its Articles of Incorporation,
corporate resolutions authorizing the transaction, and an incumbency
certificate, whichever is applicable.

          B.   On or before the Closing Date, Seller will deliver copies of its
partnership agreement and appropriate certificates of authority to the
Purchaser.

     23.  TIME OF ESSENCE.  Time is of the essence of this Agreement.
<PAGE>
     24.  NOTICES.  Any notice or demand which either party hereto is required
or may desire to give or deliver to or make upon the other party shall be in
writing and may be personally delivered or given or made by overnight courier
such as Federal Express or by facsimile or made by United States registered or
certified mail addressed as follows:

          TO SELLER:          c/o The Balcor Company
                              2355 Waukegan Road
                              Suite A200
                              Bannockburn, Illinois 60015
                              Attn: Ilona Adams

          with copies to:     The Balcor Company
                              2355 Waukegan Road
                              Suite A200
                              Bannockburn, Illinois 60015
                              Attn: Al Lieberman
                              708/267-1600
                              708/317-4462 (FAX)

                              and

                              Andrew D. Small, Esq. 
                              Katten Muchin & Zavis 
                              Suite 2100 
                              525 W. Monroe Street 
                              Chicago, Illinois 60661
                              312/902-5532
                              312/222-1061 (FAX)

          TO PURCHASER:       Alan George
                              c/o Equity Residential Properties Trust
                              Two North Riverside Plaza
                              Suite 450
                              Chicago, Illinois 60606-2639
                              312/466-3932
                              312/454-9678 (FAX)

          with a copy to:     Bruce Strohm
                              c/o Equity Residential Properties Trust
                              Two North Riverside Plaza
                              Suite 450
                              Chicago, Illinois 60606-2639
                              312/466-3624
                              312/454-0434 (FAX)

subject to the right of either party to designate a different address for
itself by notice similarly given.  Any notice or demand so given shall be
deemed to be delivered or made on the next business day if sent by overnight
courier, or on the same day if sent by facsimile before the close of business,
or the next day if sent by facsimile after the close of business, or on the 4th
business day after the same is deposited in the United States Mail as
registered or certified matter, addressed as above provided, with postage
<PAGE>
thereon fully prepaid.  Any such notice, demand or document not given,
delivered or made by registered or certified mail or by overnight courier or by
facsimile as aforesaid shall be deemed to be given, delivered or made upon
receipt of the same by the party to whom the same is to be given, delivered or
made.  Copies of all notices shall be served upon the Escrow Agent.

     25.  EXECUTION OF AGREEMENT AND ESCROW AGREEMENT.  Purchaser will execute
three (3) copies of this Agreement and three (3) copies of the Escrow Agreement
and forward them to Seller for execution.  Seller will forward one (1) copy of
the executed Agreement to Purchaser and will forward the following to the
Escrow Agent:

          A.   One (1) fully executed copy of this Agreement, and

          B.   Three (3) copies of the Escrow Agreement signed by the parties
with a direction to execute two (2) copies of the Escrow Agreement and deliver
a fully executed copy to the Purchaser and the Seller.  Purchaser shall deposit
the initial $300,000 of Earnest Money immediately following receipt by
Purchaser of a fully executed Purchase Agreement and Escrow Agreement.

     26.  GOVERNING LAW.  The provision contained herein with reference to
retention of the Earnest Money in the event of Purchaser's default shall be
governed by the laws of the State of Illinois.  The remaining provisions of
this Agreement shall be governed by the laws of the State of North Carolina.
 
     27.  ENTIRE AGREEMENT.  This Agreement constitutes the entire agreement
between the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.

     28.  COUNTERPARTS.  This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.

     29.  CAPTIONS.  Paragraph titles or captions contained herein are inserted
as a matter of convenience and for reference, and in no way define, limit,
extend or describe the scope of this Agreement or any provision hereof.

     30.  FINANCIAL STATEMENTS.  Seller acknowledges that audited financial
statements pertaining to the Property for one prior calendar year of operation
and the portion of the calendar year in which the Closing occurs up to the
Closing Date are required to be filed by the Purchaser with the Securities and
Exchange Commission after the Closing.  Accordingly, Seller agrees that for a
period of six (6) months after the Closing Date it shall provide Purchaser and
its representatives with access to Seller's books and records after the Closing
upon reasonable advance notice in order to conduct the required audit, which
shall be done at Purchaser's cost and expense.

     31.  CONVEYANCE OF PARTNERSHIP INTERESTS.  If requested to do so by
Purchaser, Seller hereby agrees, at no cost or expense to Seller, to cooperate
in good faith with Purchaser in structuring the conveyance of Property by the
Seller to Purchaser as a conveyance of title to such Property by the Seller
into a partnership or limited liability company having the Seller and/or
<PAGE>
affiliates of the Seller as its sole partners (or members) and then, at
Closing, assigning to Purchaser the partnership (or membership) interests in
the partnership (or limited liability company).  In such case, the Purchaser
hereby agrees to indemnify and hold the Seller harmless from and against any
and all loss, cost, expense, liability or damage (including reasonable
attorneys fees) incurred by Seller arising out of Seller's conveyance in and
out of such partnership (or limited liability company) provided that such loss,
cost, expense, liability or damage (including reasonable attorneys fees) would
not have been suffered or incurred by such Seller if such Property had been
conveyed directly by Seller to Purchaser.  This Paragraph 31 shall survive the
Closing and the delivery of the Deed.


     IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of
the date set forth above.

Executed by Purchaser on      PURCHASER:
July 12, 1996.
                              ERP OPERATING LIMITED PARTNERSHIP, 
                              an Illinois limited partnership

                              By:  Equity Residential Properties Trust, 
                                   a Maryland real estate investment trust


                                   By:  /s/Alan W. George
                                        ------------------------------
                                   Name:   Alan W. George
                                        ------------------------------
                                   Title:  Senior Vice President
                                        ------------------------------


Executed by Seller on         SELLER:
July 15, 1996.
                              WOODSCAPE LIMITED PARTNERSHIP, 
                              an Illinois limited partnership

                              By:  Woodscape Partners, Inc., an Illinois 
                                   corporation, its general partner


                                   By:  /s/Phillip A. Schechter
                                        ------------------------------
                                   Name:   Phillip A. Schechter
                                        ------------------------------
                                   Title:  Authorized Agent
                                        ------------------------------
<PAGE>
                                BROKER JOINDER


                    of CB Commercial Real Estate Group, Inc. ("CB") executed
this Agreement in its capacity as a real estate broker and acknowledges that
the fee or commission due it from Seller as a result of the transaction
described in this Agreement is as set forth in that certain Listing Agreement,
dated _______ __, 1996 between Seller and CB (the "Listing Agreement").  CB
acknowledges that payment of the aforesaid fee or commission is conditioned
upon the Closing and the receipt of the Purchase Price by the Seller.  CB
agrees to deliver a receipt to the Seller at the Closing for the fee or
commission due CB and a release, in the appropriate form, stating that no other
fees or commissions are due to it from Seller or Purchaser.


                         CB COMMERCIAL REAL ESTATE GROUP, INC.

                         By:
                              ------------------------------------
<PAGE>
                                   EXHIBITS


A    -    Legal

B    -    Personal Property

C    -    Escrow Agreement

D    -    Deed 

E    -    Bill of Sale

F    -    Assignment of Service Contracts

G    -    Assignment of Leases and Security Deposits

H    -    Notice to Tenants

I    -    Non-Foreign Affidavit

J    -    Compliance with Laws and Notice of Litigation
 
K    -    Rent Roll

L    -    Licenses, Permits and Service Contracts

M    -    Existing Reports
<PAGE>
                              July 22, 1996

VIA FACSIMILE MAIL


Woodscape L.P.                The Balcor Company       Daniel J. Perlman, Esq.
c/o The Balcor Company        2355 Waukegan Road       Katten Muchin & Zavis
2355 Waukegan Road            Suite A200               Suite 2100
Suite A200                    Bannockburn, IL  60015   Chicago, IL  60661
Bannockburn, IL  60015        Attn.:  Al Lieberman
Attn.:  Ilona Adams

     Re:  Agreement of Sale, dated as of the 15th day of July, 1996 
          (the "Agreement") between Woodscape Limited Partnership, 
          as Seller, and ERP Operating Limited Partnership, as Purchaser, for 
          the purchase of Woodscape Apartments, Raleigh, North Carolina 
          (the "Property").

Dear Ms. Adams and Messrs. Lieberman and Perlman:

     Purchaser hereby requests  an extension  of the Approval  Period, as  such
term is defined in Section  16(A) of the Agreement,  from August 9, 1996  until
5:00 CDT on  August 16, 1996.  Please acknowledge Seller's  acceptance of  this
modification to the Agreement  by executing this letter  in the space  provided
below and returning it via facsimile mail to Purchaser.

                         ERP OPERATING LIMITED PARTNERSHIP,
                         an Illinois limited partnership

                         By:  Equity Residential Properties Trust,
                              a Maryland Real Estate Investment
                              Trust, its general partner

                         By:  /s/ Shelley L. Dunck
                              ------------------------------------
                                  Shelley L. Dunck
                                  Vice President


Approved and Accepted this 22nd day of July, 1996

WOODSCAPE LIMITED PARTNERSHIP, an Illinois 
limited partnership

By: Woodscape Partners, Inc., an Illinois corporation
 

     By:  /s/ Alan G. Lieberman
          ------------------------------
              Alan G. Lieberman
              Senior Vice President
<PAGE>


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