RESOURCES PENSION SHARES 5 LP, SC 14D1, 1998-02-18

RESOURCES PENSION SHARES 5 LP
SC 14D1, 1998-02-18
REAL ESTATE INVESTMENT TRUSTS

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<PAGE>

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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

SCHEDULE 14D-1
Tender Offer Statement Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934

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

RESOURCES PENSION SHARES 5, L.P.
a Delaware Limited Partnership
(Name of Subject Company)

PRESIDIO RPS ACQUISITION CORP.
(Bidder)

PRESIDIO CAPITAL CORP.
(Co-Bidder)

UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class
of Securities)

NONE
(CUSIP Number of Class
of Securities)

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

Allan B. Rothschild Copy to:
Presidio RPS Acquisition Corp. Mark I. Fisher
411 West Putnam Avenue Todd J. Emmerman
Greenwich, CT 06830 Rosenman & Colin LLP
(203) 862-7051 575 Madison Avenue
New York, NY 10022
(212) 940-8800

(Name, Address and Telephone Number of
Person Authorized to Receive Notices and
Communications on Behalf of Bidder)

<TABLE>
Calculation of Filing Fee
- -------------------------------------------------------------------------------
Transaction Amount of
Valuation* Filing Fee
----------- ----------
<S> <C>
$12,000,000 $2,400
- -------------------------------------------------------------------------------
</TABLE>

*For purposes of calculating the filing fee only. This amount assumes
the purchase of 2,000,000 Units of Limited Partnership Interest ("Units") of
the subject company for $6.00 per Unit in cash.

/ / Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form
or Schedule and date of its filing.

<PAGE>

CUSIP No.: NONE 14D-1

- -------------------------------------------------------------------------------
1.Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person

PRESIDIO RPS ACQUISITION CORP.
- -------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group
(See Instructions)
(a) / /

(b) / /
- -------------------------------------------------------------------------------
3. SEC Use Only

- -------------------------------------------------------------------------------
4. Sources of Funds (See Instructions)

AF; WC
- -------------------------------------------------------------------------------
5. Check Box if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)

/ /
- -------------------------------------------------------------------------------
6. Citizenship or Place of Organization

Delaware
- -------------------------------------------------------------------------------
7. Aggregate Amount Beneficially Owned by Each Reporting
Person

100 Units
- -------------------------------------------------------------------------------
8. Check Box if the Aggregate Amount in Row (7) Excludes
Certain Shares (See Instructions)

/ /
- -------------------------------------------------------------------------------
9. Percent of Class Represented by Amount in Row (7)

less than .1%
- -------------------------------------------------------------------------------
10. Type of Reporting Person (See Instructions)

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

<PAGE>

CUSIP No.: NONE 14D-1

- -------------------------------------------------------------------------------
1.Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person

Presidio Capital Corp.
- -------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group
(See Instructions)
(a) / /

(b) / /
- -------------------------------------------------------------------------------
3. SEC Use Only

- -------------------------------------------------------------------------------
4. Sources of Funds (See Instructions)

N/A
- -------------------------------------------------------------------------------
5. Check Box if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)

/ /
- -------------------------------------------------------------------------------
6. Citizenship or Place of Organization

Delaware
- -------------------------------------------------------------------------------
7. Aggregate Amount Beneficially Owned by Each Reporting
Person

624,935.33 Units*
- -------------------------------------------------------------------------------
8. Check Box if the Aggregate Amount in Row (7) Excludes
Certain Shares (See Instructions)

/ /
- -------------------------------------------------------------------------------
9. Percent of Class Represented by Amount in Row (7)

Approximately 11.1%
- -------------------------------------------------------------------------------
10. Type of Reporting Person (See Instructions)

* Includes 100 Units owned by Presidio RPS Acquisition Corp.

<PAGE>

Item 1. SECURITY AND SUBJECT COMPANY.

(a) The name of the subject company is Resources Pension Shares 5,
L.P. (the "Partnership"), a Delaware limited partnership, which has its
principal executive offices at 411 West Putnam Avenue, Greenwich, Connecticut
06830.

(b) This Schedule relates to the offer by Presidio RPS Acquisition
Corp. (the "Purchaser"), a Delaware corporation, to purchase up to 2,000,000
outstanding Units of Limited Partnership Interest ("Units") of the
Partnership at $6.00 per Unit, upon the terms and subject to the conditions
set forth in the Offer to Purchase dated February 18, 1998 (the "Offer to
Purchase") and the related Letter of Transmittal, copies of which are
attached hereto as Exhibits (a)(1) and (a)(2), respectively. The number of
Units outstanding is set forth in "INTRODUCTION" in the Offer to Purchase and
is incorporated herein by reference.

(c) The information set forth in "THE TENDER OFFER -- Section 13.
Purchase Price Considerations" of the Offer to Purchase is incorporated
herein by reference.

Item 2. IDENTITY AND BACKGROUND.

(a)-(d) The information set forth in "INTRODUCTION", "THE TENDER
OFFER -- Section 11. Certain Information Concerning the Purchaser" and
Schedule 1 of the Offer to Purchase is incorporated herein by reference.

(e)-(f) During the last five years, neither the Purchaser,
Presidio Capital Corp. nor, to the best of its

<PAGE>

knowledge, any of the persons listed in Schedule 1 of the Offer to Purchase
(i) has been convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors) or (ii) was a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and as a result of
such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting activities subject to, Federal
or state securities laws or finding any violation of such laws.

(g) The information set forth in Schedule 1 of the Offer to
Purchase is incorporated herein by reference.

Item 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT
COMPANY.

(a) The information set forth in "THE TENDER OFFER -- Section 10.
Conflicts of Interest and Transactions with Affiliates" and "THE TENDER OFFER
- --Section 11. Certain Information Concerning the Purchaser" of the Offer to
Purchase is incorporated herein by reference.

(b) None.

Item 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.

(a) The information set forth in "THE TENDER OFFER -- Section 12.
Source of Funds" of the Offer to Purchase is incorporated herein by reference.

(b) Not applicable.

<PAGE>

Item 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.

(a)-(e) The information set forth in "THE TENDER OFFER -- Section
8. Future Plans" of the Offer to Purchase is incorporated herein by reference.

(f)-(g) The information set forth in "THE TENDER OFFER -- Section
7. Effects of the Offer" of the Offer to Purchase is incorporated herein by
reference.

Item 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.

(a)-(b) The information set forth in "INTRODUCTION" and "THE
TENDER OFFER -- Section 11. Certain Information Concerning the Purchaser" of
the Offer to Purchase is incorporated herein by reference.

Item 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES.

The information set forth in "INTRODUCTION" and "THE TENDER OFFER
- -- Section 10. Conflicts of Interest and Transactions with Affiliates" of the
Offer to Purchase is incorporated herein by reference.

Item 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.

The information set forth in "THE TENDER OFFER -- Section 16. Fees
and Expenses" of the Offer to Purchase is incorporated herein by reference.

<PAGE>

Item 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.

Not applicable.

Item 10. ADDITIONAL INFORMATION.

(a) None.

(b)-(d) The information set forth in "THE TENDER OFFER --Section
15. Certain Legal Matters" of the Offer to Purchase is incorporated herein
by reference.

(e) The information set forth in "THE TENDER OFFER -- Section
9. Certain Information Concerning the Partnership" of the Offer to Purchase
is incorporated herein by reference.

(f) Reference is hereby made to the Offer to Purchase and the
related Letter of Transmittal, copies of which are attached hereto as
Exhibits (a)(1) and (a)(2), respectively, and which are incorporated herein
in their entirety by reference.

Item 11. MATERIAL TO BE FILED AS EXHIBITS.

(a)(1) Offer to Purchase dated February 18, 1998.

(a)(2) Letter of Transmittal.

(a)(3) Cover Letter, dated February 18, 1998, from Presidio RPS
Acquisition Corp. to Unitholders.

(b)-(f) Not applicable.

<PAGE>

SIGNATURES

After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and
correct.

Dated: February 18, 1998

PRESIDIO RPS ACQUISITION CORP.

By: /s/ Allan B. Rothschild
--------------------------------------
Vice President

PRESIDIO CAPITAL CORP.

By: /s/ Allan B. Rothschild
--------------------------------------
Title: Executive Vice President

<PAGE>

EXHIBIT INDEX

Sequentially
Exhibit No. Description Numbered Page
- ----------- ----------- -------------

(a)(1) Offer to Purchase dated February 18, 1998. . . . . . . . . . . . . . .

(a)(2) Letter of Transmittal. . . . . . . . . . . . . . . . . . . . . . . . .

(a)(3) Cover Letter, dated February 18, 1998,
from Presidio RPS Acquisition Corp.
to Unitholders . . . . . . . . . . . . . . . . . . . . . . . . . . . .

<PAGE>

OFFER TO PURCHASE FOR CASH
UP TO 2,000,000 UNITS OF LIMITED PARTNERSHIP INTEREST
OF
RESOURCES PENSION SHARES 5, L.P.
FOR
$6.00 NET PER UNIT
BY
PRESIDIO RPS ACQUISITION CORP.

- --------------------------------------------------------------------------------
THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MARCH 17, 1998, UNLESS EXTENDED.
- --------------------------------------------------------------------------------

Presidio RPS Acquisition Corp. (the "Purchaser"), a Delaware
corporation, hereby offers to purchase up to 2,000,000 of the outstanding
Units of Limited Partnership Interest ("Units") of Resources Pension Shares
5, L.P. (the "Partnership"), a Delaware limited partnership, for $6.00 per
Unit (the "Purchase Price"), net to the seller in cash, without interest,
upon the terms set forth in this Offer to Purchase (the "Offer to Purchase")
and in the related Letter of Transmittal, as each may be supplemented or
amended from time to time (which together constitute the "Offer"). HOLDERS
OF UNITS ("UNITHOLDERS") WHO TENDER THEIR UNITS WILL NOT BE OBLIGATED TO PAY
ANY COMMISSIONS OR PARTNERSHIP TRANSFER FEES. The 2,000,000 Units sought
pursuant to the Offer represent approximately 35% of the total Units
outstanding as of December 31, 1997.

The Purchaser is an affiliate of Resources Capital Corp., Resources
Pension Advisory Corp., and Presidio AGP Corp, the general partners of the
Partnership (collectively, the "General Partner"). While the Purchaser
believes that limited partners will maximize their investment in the
Partnership by retaining their Units, the Offer is being made to afford
Unitholders who desire liquidity the opportunity to dispose of their Units at
a price that may be in excess of that afforded in the informal secondary
market and that exceeds the price in a recent, unsolicited third party
limited tender offer to purchase fewer than 5% of the outstanding Units for
$5.00 per Unit. The weighted average selling price in the secondary market
for the most recent period as reported in Partnership Spectrum, an
independent third-party industry publication, was $5.25 per Unit, without
giving effect to commissions and other transactional costs payable by sellers
of Units (which typically range between 8% and 10% of the reported selling
price). Assuming commissions and transactional costs of 9%, $4.78 of the
$5.25 weighted average selling price would be received by selling Unitholders
in the secondary market. Unitholders who tender their Units will not be
obligated to pay any commissions or Partnership transfer fees.

Before tendering, Unitholders are urged to consider the following
factors:

- - The net asset value of the Partnership as of December 31, 1997 has been
estimated by the Purchaser (which is an affiliate of the General Partner)
at approximately $8.75 per Unit (the "Net Asset Value"). (See - "THE
TENDER OFFER - Purchase Price Considerations".)

- - As of December 31, 1997, the Partnership had approximately $15,700,000 of
reserves, a substantial portion of which is attributable to mortgage
principal payments and property sales ("Disposition Proceeds"). The
General Partner is actively seeking new investment opportunities for these
funds. Pursuant to the terms of the Partnership Agreement,

(CONTINUED ON NEXT PAGE)
----------------------------------------

If you have any questions or need additional information, you may contact The
Herman Group, Inc., the Information Agent for the Offer (the "Information
Agent") at:
(800) 992-6209

February 18, 1998

<PAGE>
(CONTINUED FROM COVER PAGE)

until April 1998 the Partnership is not permitted to distribute
Disposition Proceeds and, after that date, the Partnership may either
distribute or reinvest such proceeds or continue to hold such proceeds in
reserve. The Partnership is not required to be liquidated until December
2010.

- - The Purchaser and the General Partner are affiliated and, accordingly,
certain conflicts of interest with respect to the Offer may exist for the
General Partner. (See "THE TENDER OFFER - Section 10. Conflicts of
Interest and Transactions with Affiliates".) As a result of the
affiliation between the Purchaser and the General Partner, the Partnership
has advised the Purchaser that it makes no recommendation and is remaining
neutral as to whether a Unitholder should tender Units in the Offer.

- - The Offer is being made to afford liquidity to Unitholders. However, the
Purchaser (which is an affiliate of the General Partner) is also making the
Offer with a view to making a profit. Accordingly, in establishing the
Purchase Price, the Purchaser was motivated to set the lowest price for the
Units which might be acceptable to Unitholders consistent with the
Purchaser's objectives. Such objectives and motivations may conflict with
the interest of Unitholders in receiving the highest price for their Units.
No independent person has been retained to evaluate or render any opinion
with respect to the fairness of the Purchase Price and no representation is
made by the Purchaser, the General Partner or any affiliate of the
Purchaser or the General Partner as to such fairness.

- - Depending upon the number of Units tendered pursuant to the Offer, the
Purchaser (which is an affiliate of the General Partner) could be in a
position to significantly influence all Partnership decisions on which
Unitholders may vote, including decisions regarding removal of the General
Partner, sales of assets and dissolution of the Partnership. (See "THE
TENDER OFFER - Section 7. Effects of the Offer".) This means that (i)
non-tendering Unitholders could be prevented from taking action they
desire but that the Purchaser opposes and (ii) the Purchaser may be able
to take action desired by the Purchaser but opposed by non-tendering
Unitholders.

- - Consummation of the Offer may limit the ability of Unitholders to dispose
of Units in the secondary market during the twelve month period following
completion of the Offer. (See "THE TENDER OFFER - Section 7. Effects of
the Offer".)

- - Unitholders who tender their Units will be giving up the opportunity to
participate in any future potential benefits represented by the ownership
of such Units, including potential future distributions by the Partnership
and potential appreciation in the value of the Units (except that
Unitholders will continue to be entitled to receive the $.11 per Unit
distribution to be made by the Partnership during the first quarter of 1998
with respect to the fourth quarter of 1997).

- - Unitholders could, as an alternative to tendering their Units, propose a
variety of possible actions including dissolution of the Partnership or
removal and replacement of the General Partner.

The Offer is not conditioned upon any minimum number of Units being
tendered. If more than 2,000,000 Units are validly tendered and not
withdrawn, the Purchaser will accept for purchase on a pro rata basis
2,000,000 Units, subject to the terms and conditions herein.

The Purchaser expressly reserves the right, in its sole discretion, at
any time and from time to time, (i) to extend the period of time during which
the Offer is open and thereby delay acceptance for payment of, and the
payment for, any Units, (ii) to terminate the Offer and not accept any Units
for payment, (iii) upon the occurrence of any of the conditions specified in
Section 14 of this Offer to Purchase, to delay the acceptance for payment of,
or payment for, any Units not theretofore accepted for payment or paid for,
and (iv) to amend the Offer in any respect (including, without limitation, by
increasing the consideration offered, increasing or decreasing the number of
Units being sought, or both). Notice of any such termination or amendment
will promptly be disseminated to Unitholders in a manner reasonably designed
to inform Unitholders of such change in compliance with Rule 14d-4(c) under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). In the
case of an extension of the Offer, such extension will be followed by a press
release or public announcement which will be issued no later than 9:00 a.m.,
New York City time, on the next business day after the scheduled Expiration
Date, in accordance with Rule 14e-1(d) under the Exchange Act.
<PAGE>

UNITHOLDERS ARE URGED TO READ THIS OFFER TO PURCHASE AND THE
ACCOMPANYING LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO
TENDER THEIR UNITS. ANY UNITHOLDER DESIRING TO TENDER UNITS SHOULD COMPLETE
AND SIGN THE LETTER OF TRANSMITTAL (OR A FACSIMILE THEREOF) AND MAIL OR
DELIVER THE SIGNED LETTER OF TRANSMITTAL TO THE DEPOSITARY FOR THE OFFER (THE
"DEPOSITARY"), AT THE FOLLOWING ADDRESS:

THE HERMAN GROUP, INC.

BY HAND, MAIL OR OVERNIGHT DELIVERY: 2121 SAN JACINTO STREET
26TH FLOOR
DALLAS, TEXAS 75201

BY FACSIMILE: (214) 999-9348 OR (214) 999-9323

IF YOU HAVE ANY QUESTIONS OR IF YOU NEED ASSISTANCE IN COMPLETION OF THE
LETTER OF TRANSMITTAL, YOU MAY CONTACT THE INFORMATION AGENT FOR THE OFFER BY
CALLING:

(800) 992-6209

<PAGE>

TABLE OF CONTENTS

PAGE
----
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

THE TENDER OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1. Terms of the Offer. . . . . . . . . . . . . . . . . . . . . 4
Section 2. Proration; Acceptance for Payment and Payment for Units . . 4
Section 3. Procedures for Tendering Units. . . . . . . . . . . . . . . 5
Section 4. Withdrawal Rights . . . . . . . . . . . . . . . . . . . . . 6
Section 5. Extension of Tender Period; Termination; Amendment. . . . . 6
Section 6. Certain Federal Income Tax Consequences . . . . . . . . . . 7
Section 7. Effects of the Offer. . . . . . . . . . . . . . . . . . . . 9
Section 8. Future Plans. . . . . . . . . . . . . . . . . . . . . . . . 9
Section 9. Certain Information Concerning the Partnership. . . . . . . 10
Section 10. Conflicts of Interest and Transactions with Affiliates.. . 15
Section 11. Certain Information Concerning the Purchaser . . . . . . . 15
Section 12. Source of Funds. . . . . . . . . . . . . . . . . . . . . . 16
Section 13. Purchase Price Considerations. . . . . . . . . . . . . . . 16
Section 14. Conditions of the Offer. . . . . . . . . . . . . . . . . . 18
Section 15. Certain Legal Matters. . . . . . . . . . . . . . . . . . . 19
Section 16. Fees and Expenses. . . . . . . . . . . . . . . . . . . . . 20
Section 17. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . 20

Appendix A Glossary

Schedule 1 Information With Respect to the Executive Officers and
Directors of the Purchaser and Presidio Capital Corp.

<PAGE>

To the Holders of Units of Limited Partnership Interest of
RESOURCES PENSION SHARES 5, L.P.

INTRODUCTION

The Purchaser hereby offers to purchase up to 2,000,000 of the
outstanding Units for $6.00 per Unit, net to the seller in cash, without
interest, upon the terms set forth in this Offer to Purchase and in the
related Letter of Transmittal, as each may be supplemented or amended from
time to time. Unitholders who tender their Units will not be obligated to pay
any commissions or partnership transfer fees. The Purchaser is an affiliate
of the General Partner.

Before tendering, Unitholders are urged to consider the following
factors:

- - The Net Asset Value of the Partnership as of December 31, 1997 has been
estimated by the Purchaser (which is an affiliate of the General Partner)
at approximately $8.75 per Unit. (See - "THE TENDER OFFER - Purchase Price
Considerations".)

- - As of December 31, 1997, the Partnership had approximately $15,700,000 of
reserves, a substantial portion of which is attributable to Disposition
Proceeds. The General Partner is actively seeking new investment
opportunities for these funds. Pursuant to the terms of the Partnership
Agreement, until April 1998 the Partnership is not permitted to distribute
Disposition Proceeds and, after that date, the Partnership may either
distribute or reinvest such proceeds or continue to hold such proceeds in
reserve. The Partnership is not required to be liquidated until December
2010.

<PAGE>

entitled to receive the $.11 per Unit distribution to be made by the
Partnership during the first quarter of 1998 with respect to the fourth
quarter of 1997).

Unitholders who desire liquidity may wish to consider the Offer.
However, each Unitholder must make its own decision based upon such
Unitholder's particular circumstances, including the Unitholder's own
financial needs, other investment opportunities and tax position. Each
Unitholder should consult with his or her own advisors, tax, financial or
otherwise, in evaluating the terms of the Offer and determining whether to
tender Units pursuant to the Offer.

The Offer will provide Unitholders with an opportunity to liquidate
their investment without the usual transaction costs associated with market
sales. Unitholders may no longer wish to continue with their investment in
the Partnership for a number of reasons, including:

- - Although not necessarily an indication of value, the $6.00 Purchase Price
is approximately 14% higher than the $5.25 weighted average net selling
price for Units reported for the limited secondary market during the two
month period ended November 30, 1997, without giving effect to commissions
and other transactional costs payable by sellers of Units (which typically
range between 8% and 10% of the reported selling price). ASSUMING
COMMISSIONS AND TRANSACTIONAL COSTS OF 9%, $4.78 OF THE $5.25 WEIGHTED
AVERAGE SELLING PRICE WOULD BE RECEIVED BY SELLING UNITHOLDERS IN THE
SECONDARY MARKET. Unitholders who tender their Units will not be obligated
to pay any commissions or Partnership transfer fees. The $6.00 Purchase
Price is also 20% higher than the recent tender offer ("the Everest Offer")
by Everest Investors 8, LLC ("Everest"), an independent third party, to
purchase Units for $5 per Unit.

- - The Offer will provide Unitholders with an immediate opportunity to
liquidate their investment in the Partnership without the usual transaction
costs associated with market sales or partnership transfer fees.

- - The absence of a formal trading market for the Units.

- - By selling their Units in the Offer, Unitholders avoid the continuing
administrative costs (such as accounting, tax reporting, limited partner
reporting and public company reporting requirements) and resultant indirect
negative financial impact on the value of the Units of a publicly
registered limited partnership.

- - General disenchantment with real estate investments, particularly long-term
investments in limited partnerships.

The Purchase Price was determined as a result of the Purchaser's own
independent analysis. No independent person has been retained to evaluate or
render any opinion with respect to the fairness of the Purchase Price.
Unitholders are urged to consider carefully all the information contained
herein before accepting the Offer. (See "THE TENDER OFFER - Section 13.
Purchase Price Considerations".)

According to the Partnership's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996, as of March 1, 1997 there were 5,690,843 Units
issued and outstanding held by approximately 5,693 Unitholders. The
Purchaser and its affiliates own, in the aggregate, 624,935.33 Units,
constituting approximately 11% of the Units outstanding.

Certain information contained in this Offer to Purchase which relates to
the Partnership, or represents statements made by the General Partner, has
been derived from information provided to the Purchaser by the General
Partner.

2
<PAGE>

UNITHOLDERS DESIRING TO TENDER UNITS SHOULD COMPLETE AND SIGN THE LETTER
OF TRANSMITTAL (OR A FACSIMILE THEREOF) AND MAIL OR DELIVER THE SIGNED LETTER
OF TRANSMITTAL TO THE DEPOSITARY AT THE FOLLOWING ADDRESS:

THE HERMAN GROUP, INC.

BY HAND, MAIL OR OVERNIGHT DELIVERY: 2121 SAN JACINTO STREET
26TH FLOOR
DALLAS, TEXAS 75201

BY FACSIMILE: (214) 999-9348 OR (214) 999-9323

IF YOU HAVE ANY QUESTIONS OR NEED ASSISTANCE IN COMPLETION OF THE LETTER
OF TRANSMITTAL, YOU MAY CONTACT THE INFORMATION AGENT BY CALLING:

(800) 992-6209

3
<PAGE>

THE TENDER OFFER

SECTION 1. TERMS OF THE OFFER. Upon the terms of the Offer, the
Purchaser will pay for Units validly tendered on or prior to the Expiration
Date and not withdrawn in accordance with Section 4 of this Offer to
Purchase. The term "Expiration Date" shall mean 12:00 Midnight, New York
City time, on March 17, 1998, unless the Purchaser extends the period of time
during which the Offer is open. In the event the Offer is extended, the term
"Expiration Date" shall mean the latest time and date on which the Offer, as
extended by the Purchaser, shall expire.

IF, PRIOR TO THE EXPIRATION DATE, THE PURCHASER SHALL INCREASE THE
PURCHASE PRICE OFFERED TO UNITHOLDERS, SUCH INCREASED PURCHASE PRICE SHALL BE
PAID FOR ALL UNITS ACCEPTED FOR PAYMENT PURSUANT TO THE OFFER, WHETHER OR NOT
SUCH UNITS WERE TENDERED PRIOR TO SUCH INCREASE.

The Offer is subject to satisfaction of certain conditions. See Section
14, which sets forth in full the conditions of the Offer. The Purchaser
reserves the right (but shall not be obligated), in its sole discretion, to
waive any or all of such conditions. If, on or prior to the Expiration Date,
any or all of such conditions have not been satisfied or waived, the
Purchaser may (i) decline to purchase any of the Units tendered, terminate
the Offer and return all tendered Units to tendering Unitholders, (ii) waive
all the unsatisfied conditions and, subject to complying with applicable
rules and regulations of the Securities and Exchange Commission (the
"Commission"), purchase all Units validly tendered, (iii) extend the Offer
and, subject to the right of Unitholders to withdraw Units until the
Expiration Date, cause the Depositary to retain the Units that have been
tendered during the period or periods for which the Offer is extended, or
(iv) amend the Offer, including by increasing the Purchase Price.

SECTION 2. PRORATION; ACCEPTANCE FOR PAYMENT AND PAYMENT FOR UNITS. If
the number of Units validly tendered on or prior to the Expiration Date and
not withdrawn is 2,000,000 or less, the Purchaser will accept for payment,
subject to the terms and conditions of the Offer, all Units so tendered. If
the number of Units validly tendered on or prior to the Expiration Date and
not withdrawn exceeds 2,000,000, the Purchaser will accept for payment,
subject to the terms and conditions of the Offer, 2,000,000 Units so tendered
on a pro rata basis (with such adjustments to avoid purchase of fractional
Units and to comply with the provisions of the Partnership Agreement which
prohibit any Unitholder from holding less than 100 Units).

The Purchaser will pay for Units validly tendered and not withdrawn in
accordance with Section 4 as promptly as practicable following the Expiration
Date. In all cases, the Purchase Price will be paid only after timely
receipt by the Depositary of a properly completed and duly executed Letter of
Transmittal, and any other documents required by the Letter of Transmittal.
(See "Section 3. Procedures for Tendering Units".)

For purposes of the Offer, the Purchaser shall be deemed to have
accepted for payment tendered Units when, as and if the Purchaser gives oral
or written notice to the Depositary of the Purchaser's acceptance for payment
of such Units pursuant to the Offer. Upon the terms and subject to the
conditions of the Offer, payment for Units tendered and accepted for payment
pursuant to the Offer will in all cases be made by deposit of the Purchase
Price with the Depositary, which will act as agent for the tendering
Unitholders for the purpose of receiving payment from the Purchaser and
transmitting payment to tendering Unitholders. Under no circumstances will
interest be paid on the Purchase Price by reason of any delay in making such
payment.

If any tendered Units are not purchased for any reason, the Letter of
Transmittal with respect to such Units will be destroyed by the Purchaser.
If for any reason acceptance for payment of, or payment for, any Units
tendered pursuant to the Offer is delayed or the Purchaser is unable to
accept for payment, purchase or pay for Units tendered pursuant to the Offer,
then, without prejudice to the Purchaser's rights under Section 14, the
Purchaser may cause the Depositary to retain tendered Units and such Units
may not be withdrawn except to the extent that the tendering Unitholders are
entitled to withdrawal rights as described in Section 4; PROVIDED, HOWEVER,
that the Purchaser is required, pursuant to Rule 14e-1(c) under the Exchange
Act, to pay Unitholders the Purchase Price in respect of Units tendered or
return such Units promptly after termination or withdrawal of the Offer.

4
<PAGE>

SECTION 3. PROCEDURES FOR TENDERING UNITS.

VALID TENDER. To validly tender Units, a properly completed and duly
executed Letter of Transmittal (or a facsimile thereof) and any other
documents required by the Letter of Transmittal must be received by the
Purchaser on or prior to the Expiration Date. In order to comply with
certain restrictions on transfer in the Partnership Agreement, a tender which
would result in the tendering Unitholder owning less than 100 Units will not
be effective.

SIGNATURE REQUIREMENTS. If the Letter of Transmittal is signed by the
registered holder of the Units and payment is to be made directly to that
holder, then no notarization or signature guarantee is required on the Letter
of Transmittal. Similarly, if the Units are tendered for the account of a
member firm of a registered national securities exchange, a member of the
National Association of Securities Dealers, Inc. or a commercial bank,
savings bank, credit union, savings and loan association or trust company
having an office, branch or agency in the United States (each an "Eligible
Institution"), no notarization or signature guarantee is required on the
Letter of Transmittal. HOWEVER, IN ALL OTHER CASES, ALL SIGNATURES ON THE
LETTER OF TRANSMITTAL MUST EITHER BE NOTARIZED OR GUARANTEED BY AN ELIGIBLE
INSTITUTION.

IN ORDER FOR A TENDERING UNITHOLDER TO PARTICIPATE IN THE OFFER, UNITS
MUST BE VALIDLY TENDERED AND NOT WITHDRAWN ON OR PRIOR TO THE EXPIRATION
DATE, WHICH IS 12:00 MIDNIGHT, NEW YORK CITY TIME, ON MARCH 17, 1998, UNLESS
EXTENDED.

THE METHOD OF DELIVERY OF THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING UNITHOLDER AND
DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY.

BACKUP FEDERAL INCOME TAX WITHHOLDING. To prevent the possible
application of backup federal income tax withholding with respect to payment
of the Purchase Price, a tendering Unitholder (including a tax-exempt
Unitholder) must provide the Purchaser with such Unitholder's correct
taxpayer identification number by completing the Substitute Form W-9 included
in the Letter of Transmittal. (See the Instructions to the Letter of
Transmittal and "Section 6. Certain Federal Income Tax Consequences".)

FIRPTA WITHHOLDING. To prevent the withholding of federal income tax in
an amount equal to 10% of the sum of the Purchase Price plus the amount of
Partnership liabilities allocable to each Unit purchased, a tendering
Unitholder (including a tax-exempt Unitholder) must complete the FIRPTA
Affidavit included in the Letter of Transmittal certifying such Unitholder's
taxpayer identification number and address and that the Unitholder is not a
foreign person. (See the Instructions to the Letter of Transmittal and
"Section 6. Certain Federal Income Tax Consequences".)

OTHER REQUIREMENTS. By executing a Letter of Transmittal, a tendering
Unitholder irrevocably appoints the designees of the Purchaser as such
Unitholder's proxies, in the manner set forth in the Letter of Transmittal,
each with full power of substitution, to the full extent of such Unitholder's
rights with respect to the Units tendered by such Unitholder and accepted for
payment and purchased by the Purchaser. Such appointment will be effective
when, and only to the extent that, the Purchaser accepts such Units for
payment. Upon such acceptance for payment, all prior proxies given by such
Unitholder with respect to such Units will, without further action, be
revoked, and no subsequent proxies may be given (and if given will not be
effective). The designees of the Purchaser will, as to such Units, be
empowered to exercise all voting and other rights of such Unitholder as they
in their sole discretion may deem proper at any meeting of Unitholders, by
written consent or otherwise. The Purchaser reserves the right to require
that, in order for Units to be deemed validly tendered, immediately upon the
Purchaser's acceptance for payment of such Units, the Purchaser must be able
to exercise full voting rights with respect to such Units, including voting
at any meeting of Unitholders then scheduled. In addition, by executing a
Letter of Transmittal, a Unitholder also assigns to the Purchaser all of the
Unitholder's rights to receive distributions from the Partnership with
respect to Units which are accepted for payment and purchased pursuant to the
Offer (other than the $.11 per Unit distribution to be made by the
Partnership during the first quarter of 1998 with respect to the fourth
quarter of 1997). (See "Section 6. Certain Federal Income Tax Consequences".)

5
<PAGE>

DETERMINATION OF VALIDITY; REJECTION OF UNITS; WAIVER OF DEFECTS; NO
OBLIGATION TO GIVE NOTICE OF DEFECTS. All questions as to the validity,
form, eligibility (including time of receipt) and acceptance for payment of
any tender of Units pursuant to the procedures described above will be
determined by the Purchaser, in its sole discretion, which determination
shall be final and binding. The Purchaser reserves the absolute right to
reject any or all tenders if not in proper form or if the acceptance of, or
payment for, the Units tendered may, in the opinion of the Purchaser's
counsel, be unlawful. The Purchaser also reserves the right to waive any
defect or irregularity in any tender with respect to any particular Units of
any particular Unitholder, and the Purchaser's interpretation of the terms
and conditions of the Offer (including the Letter of Transmittal and the
Instructions thereto) will be final and binding. Neither the Purchaser, the
Depositary nor any other person will be under any duty to give notification
of any defects or irregularities in the tender of any Units or will incur any
liability for failure to give any such notification.

A tender of Units pursuant to any of the procedures described above will
constitute a binding agreement between the tendering Unitholder and the
Purchaser on the terms set forth in the Offer.

SECTION 4. WITHDRAWAL RIGHTS. Except as otherwise provided in this
Section 4, all tenders of Units pursuant to the Offer are irrevocable,
provided that Units tendered pursuant to the Offer may be withdrawn at any
time prior to the Expiration Date and, unless already accepted for payment as
provided in this Offer to Purchase, may also be withdrawn at any time after
April 18, 1998.

For withdrawal to be effective, a written or facsimile transmission
notice of withdrawal must be timely received by the Depositary at the address
set forth on the back cover of this Offer to Purchase. Any such notice of
withdrawal must specify the name of the person who tendered the Units to be
withdrawn and must be signed by the person(s) who signed the Letter of
Transmittal in the same manner as the Letter of Transmittal was signed.

If purchase of, or payment for, Units are delayed for any reason or if
the Purchaser is unable to purchase or pay for Units for any reason, then,
without prejudice to the Purchaser's rights under the Offer, the Purchaser
may cause the Depositary to retain tendered Units and such Units may not be
withdrawn except to the extent that tendering Unitholders are entitled to
withdrawal rights as set forth in this Section 4; PROVIDED, HOWEVER, that the
Purchaser is required, pursuant to Rule 14e-1(c) under the Exchange Act, to
pay Unitholders the Purchase Price in respect of Units tendered or return
such Units promptly after termination or withdrawal of the Offer.

Any Units properly withdrawn will be deemed not to be validly tendered
for purposes of the Offer. Withdrawn Units may be re-tendered, however, by
following any of the procedures described in Section 3 at any time prior to
the Expiration Date.

SECTION 5. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENT. The
Purchaser expressly reserves the right, in its sole discretion, at any time
and from time to time, (i) to extend the period of time during which the
Offer is open and thereby delay acceptance for payment of, and the payment
for, any Units, (ii) to terminate the Offer and not accept any Units for
payment, (iii) upon the occurrence of any of the conditions specified in
Section 14, to delay the acceptance for payment of, or payment for, any Units
not already accepted for payment or paid for, and (iv) to amend the Offer in
any respect (including, without limitation, by increasing the consideration
offered, increasing or decreasing the number of Units being sought, or both).
Notice of any such termination or amendment will promptly be disseminated to
Unitholders in a manner reasonably designed to inform Unitholders of such
change in compliance with Rule 14d-4(c) under the Exchange Act. In the case
of an extension of the Offer, such extension will be followed by a press
release or public announcement which will be issued no later than 9:00 a.m.,
New York City time, on the next business day after the scheduled Expiration
Date, in accordance with Rule 14e-1(d) under the Exchange Act.

If the Purchaser extends the Offer, or if the Purchaser (whether before
or after its acceptance for payment of Units) is delayed in its payment for
Units or is unable to pay for Units pursuant to the Offer for any reason,
then, without prejudice to the Purchaser's rights under the Offer, the
Purchaser may cause the Depositary to retain tendered Units and such Units
may not be withdrawn except to the extent tendering Unitholders are entitled
to withdrawal rights as described in Section 4; PROVIDED, HOWEVER, that the
Purchaser is required, pursuant to Rule 14e-1(c) under

6
<PAGE>

the Exchange Act, to pay Unitholders the Purchase Price in respect of Units
tendered or return such Units promptly after termination or withdrawal of the
Offer.

If the Purchaser makes a material change in the terms of the Offer or
the information concerning the Offer or waives a material condition of the
Offer, the Purchaser will extend the Offer and disseminate additional tender
offer materials to the extent required by Rules 14d-4(c) and 14d-6(d) under
the Exchange Act. The minimum period during which an offer must remain open
following a material change in the terms of the offer or information
concerning the offer will depend upon the facts and circumstances, including
the relative materiality of the change in the terms or information. In the
Commission's view, an offer should remain open for a minimum of five business
days from the date the material change is first published, sent or given to
securityholders, and if material changes are made with respect to information
that approaches the significance of price or the percentage of securities
sought, a minimum of ten business days may be required to allow for adequate
dissemination to securityholders and for investor response. As used in this
Offer to Purchase, "business day" means any day other than a Saturday, Sunday
or a federal holiday, and consists of the time period from 12:01 a.m. through
12:00 Midnight, New York City time.

SECTION 6. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The following
summary is a general discussion of certain federal income tax consequences of
a sale of Units pursuant to the Offer. This summary is based on the Internal
Revenue Code of 1986, as amended (the "Code"), applicable Treasury
Regulations thereunder, administrative rulings, practice and procedures and
judicial authority as of the date of the Offer. All of the foregoing are
subject to change, and any such change could affect the continuing accuracy
of this summary. This summary does not discuss all aspects of federal income
taxation that may be relevant to a particular Unitholder in light of such
Unitholder's specific circumstances or to certain types of Unitholders
subject to special treatment under the federal income tax laws (for example,
foreign persons, dealers in securities, banks, insurance companies and
certain types of tax-exempt organizations), nor does it discuss any aspect of
state, local, foreign or other tax laws. Sales of Units pursuant to the
Offer will be taxable transactions for federal income tax purposes, and may
also be taxable transactions under applicable state, local, foreign and other
tax laws. EACH UNITHOLDER SHOULD CONSULT HIS OR ITS TAX ADVISOR AS TO THE
PARTICULAR TAX CONSEQUENCES, INCLUDING STATE AND LOCAL TAX CONSEQUENCES, TO
SUCH UNITHOLDER OF SELLING UNITS PURSUANT TO THE OFFER.

Inasmuch as the Partnership's assets are not generating unrelated
business taxable income and are not subject to "acquisition indebtedness" (as
defined in the Code), a tax-exempt Unitholder generally should not realize
unrelated business taxable income ("UBTI") upon a sale of Units pursuant to
the Offer unless such Units are themselves held by the exempt Unitholder
subject to acquisition indebtedness incurred by such Unitholder.

Although Units were originally only sold to tax-exempt Unitholders, it
is possible that Units may now be held by persons who or which are not exempt
from federal income taxation as a result of the loss of exempt status or by
operation of law or because a foreign Unitholder is engaged in a U.S. trade
or business and has effectively connected income from such U.S. trade or
business. A taxable Unitholder will recognize gain or loss on a sale of
Units pursuant to the Offer equal to the difference between (i) the
Unitholder's "amount realized" on the sale and (ii) the Unitholder's adjusted
tax basis in the Units sold. The "amount realized" with respect to a Unit
sold pursuant to the Offer will be a sum equal to the amount of cash received
by the Unitholder for the Unit plus the amount of Partnership liabilities
allocable to the Unit (as determined under Code Section 752). The amount of
a Unitholder's adjusted tax basis in Units sold pursuant to the Offer will
vary depending upon the Unitholder's particular circumstances.

A tendering Unitholder will be allocated a pro rata share of the
Partnership's taxable income or loss with respect to the Units sold in
accordance with the provisions of the Partnership Agreement concerning
transfers of Units. Such allocation and any cash distributed by the
Partnership to a Unitholder with respect to such Units will affect the
Unitholder's adjusted tax basis in his Units and, therefore, the tax
consequences to a taxable Unitholder of a sale of Units pursuant to the
Offer. In this regard, a tendering Unitholder will be allocated a pro rata
share of the Partnership's taxable income (or loss) with respect to Units
sold pursuant to the Offer through the end of the calendar quarter in 1998 in
which the sale is consummated, but will assign to the Purchaser all rights to
receive distributions made in respect of such Units for any period after
December 31, 1997.

7
<PAGE>

Based on the results of Partnership operations through September 30,
1997, and without giving effect to Partnership operations, transactions or
distributions since that time, the Purchaser estimates that a taxable
Unitholder who sells Units pursuant to the Offer that were acquired by such
Unitholder at the time of the Partnership's original offering of Units will
recognize a loss for federal income tax purposes of approximately $5 per
Unit. Under the passive activity loss rules (discussed below), such loss
generally should be deductible by a Unitholder who is subject to these rules
from his other income (subject to any other applicable limitations) if the
Unitholder sells all his Units. The Purchaser therefore estimates that a
taxable non-corporate Unitholder who sells all his Units pursuant to this
Offer and who acquired his Units in the Partnership's original offering will
realize a net tax benefit of approximately $1 per Unit. The foregoing
calculations are estimates based on the results of Partnership operations
through September 30, 1997. The tax benefit calculation assumes that a loss
on a sale of Units could be utilized currently to offset capital gains
otherwise subject to federal income tax at a rate of 20%, and does not give
effect to state or local taxes.

The gain or loss recognized by a Unitholder on a sale of a Unit pursuant
to the Offer generally will be treated as a capital gain or loss if the Unit
was held by the Unitholder as a capital asset. (The portion of a
Unitholder's gain on the sale that is attributable to "unrealized
receivables" (which include accrued market discount and depreciation
recapture) as defined in Code Section 751, however, would be treated as
ordinary income rather than capital gain.) Such capital gain or loss will be
treated as long-term capital gain or loss if the tendering Unitholder's
holding period for the Unit exceeds 18 months. Under current law, long-term
capital gains of individuals and other non-corporate taxpayers are taxed at a
maximum marginal federal income tax rate of 20%; however, gain attributable
to straight-line depreciation deductions is taxed at a federal income tax
rate of 25%. The maximum marginal federal income tax rate for other income
of such persons is 39.6%. Capital losses are deductible only to the extent
of capital gains, except that non-corporate taxpayers may deduct up to $3,000
of capital losses in excess of the amount of their capital gains against
ordinary income. Excess capital losses generally can be carried forward to
succeeding years (a corporation's carryforward period is five years and a
non-corporate taxpayer can carry forward such losses indefinitely); in
addition, corporations, but not non-corporate taxpayers, are allowed to carry
back excess capital losses to the three preceding taxable years.

Under Code Section 469, a non-corporate taxpayer or personal service
corporation can deduct passive activity losses in any year only to the extent
of such person's passive activity income for such year, and closely held
corporations may not offset such losses against so-called "portfolio" income.
A loss recognized upon a sale of a Unit pursuant to the Offer by a
Unitholder who is subject to the passive activity loss limitation generally
would be treated as a passive activity loss under the passive activity loss
rules even though the Partnership's interest income from mortgage loans is
not treated as passive activity income under these rules. Such loss
generally could be deducted in full in the year of sale (subject to any other
applicable limitations) assuming the Unitholder sells all his Units pursuant
to the Offer. If a Unitholder does not sell all of his Units pursuant to the
Offer, then such loss could not be deducted by the Unitholder under the
passive activity loss rules (except to the extent of the Unitholder's passive
activity income, if any, from the Partnership or other sources) until the
Unitholder's remaining Units are sold. Based on the Partnership's treatment
of its mortgage loans as loans made in the ordinary course of a lending
business, the Purchaser believes that gain, if any, recognized by a
Unitholder upon a sale of a Unit pursuant to the Offer generally should
qualify for treatment as passive activity income under these rules.

A taxable Unitholder (other than corporations and certain foreign
individuals) who tenders Units may be subject to 31% backup withholding
unless the Unitholder provides a taxpayer identification number ("TIN") and
certifies that the TIN is correct or properly certifies that he is awaiting a
TIN. A Unitholder may avoid backup withholding by properly completing and
signing the Substitute Form W-9 included as part of the Letter of
Transmittal. If a Unitholder does not properly complete and sign the
Substitute Form W-9, the Purchaser will withhold 31% (and, if the Unitholder
fails to provide his taxpayer identification number, an additional $50 or
such other amount as may be imposed by law) from payments to such Unitholder.

In addition, under Section 1445 of the Code, the transferee of a
partnership interest held by a foreign person is required under certain
circumstances to deduct and withhold a tax equal to 10% of the amount
realized on the disposition. The Purchaser will withhold 10% of the amount
realized by a tendering Unitholder from the Purchase Price payable to such
Unitholder unless the Unitholder properly completes and signs the FIRPTA
Affidavit included

8
<PAGE>

as part of the Letter of Transmittal certifying the Unitholder's TIN, that
such Unitholder is not a foreign person and the Unitholder's address.

SECTION 7. EFFECTS OF THE OFFER.

LIMITATIONS ON RESALES. Pursuant to the Partnership Agreement,
transfers of Units which in the opinion of counsel to the Partnership would
cause a termination of the Partnership for federal income tax purposes (which
termination may occur when 50% or more of the Units are transferred in a
twelve-month period) are not permitted. Depending upon the number of Units
tendered pursuant to the Offer, sales of Units on the secondary market for
the twelve-month period following completion of the Offer may be limited.
The Partnership will not process any requests for transfers of Units during
such twelve-month period which the General Partner believes may cause a tax
termination. In determining the number of Units subject to the Offer, the
Purchaser took this restriction into account so as to permit historical
levels of transfers to occur after consummation of the Offer without
violating this restriction.

EFFECT ON TRADING MARKET. There is no established public trading market
for the Units and, therefore, a reduction in the number of Unitholders should
not materially further restrict the Unitholders' ability to find purchasers
for their Units.

CONTROL OF ALL UNITHOLDER VOTING DECISIONS BY PURCHASER. The Purchaser
will have the right to vote each Unit purchased pursuant to the Offer.
Depending on the number of Units purchased pursuant to the Offer, the
Purchaser could be in a position to significantly influence all voting
decisions with respect to the Partnership. Accordingly, the Purchaser could
(i) prevent non-tendering Unitholders from taking action they desire but that
the Purchaser opposes and (ii) take action desired by the Purchaser but
opposed by non-tendering Unitholders. Under the Partnership Agreement,
Unitholders holding a majority of the Units are entitled to take action with
respect to a variety of matters, including: removal and replacement of the
General Partner; dissolution of the Partnership; the sale of all or
substantially all of the Partnership's properties; material changes in the
investment objectives and policies of the Partnership; and most types of
amendments to the Partnership Agreement. When voting on such matters, the
Purchaser will vote Units owned and acquired by it in its interest, which,
because of its affiliation with the General Partner, may also be in the
interest of the General Partner.

The Units are registered under the Exchange Act, which requires, among
other things, that the Partnership furnish certain information to its
Unitholders and to the Commission and comply with the Commission's proxy
rules in connection with meetings of, and solicitation of consents from,
Unitholders. Purchase of Units pursuant to the Offer will not result in the
Units becoming eligible for deregistration under Section 12(g) of the
Exchange Act.

SECTION 8. FUTURE PLANS. The Purchaser is acquiring the Units for
investment purposes and with a view to making a profit. Subject to the
limitation on resales discussed in Section 7, following the completion of the
Offer, the Purchaser may acquire additional Units. Any such acquisition may
be made through private purchases or by any other means deemed advisable.
Any such acquisition may be at a price higher or lower than the price to be
paid for the Units purchased pursuant to the Offer. Except as set forth
herein, neither the Purchaser nor the General Partner have any present plans
or intentions with respect to a merger, reorganization or liquidation of the
Partnership, a sale of assets or financing of any of the Partnership's
investments or a change in the management, capitalization or distribution
policy of the Partnership. See "Section 9. Certain Information Concerning
the Partnership" for information with respect to the potential sale of two
properties. The General Partner is actively seeking investment opportunities
for approximately $9,900,000 of Disposition Proceeds being held by the
Partnership. In addition, in the future the General Partner may seek to
raise from Unitholders through a rights offering additional funds for
investment purposes. The Purchaser believes that consistent with its
fiduciary obligations the General Partner will continue to review any
investment or sale opportunities and will seek to maximize returns to
investors in the Units.

9
<PAGE>

SECTION 9. CERTAIN INFORMATION CONCERNING THE PARTNERSHIP. Information
included herein concerning the Partnership is derived from the Partnership's
publicly-filed reports. Additional financial and other information
concerning the Partnership is contained in the Partnership's Annual Reports
on Form 10-K, Quarterly Reports on Form 10-Q and other filings with the
Commission. Such reports and other documents may be examined and copies may
be obtained from the offices of the Commission at 450 Fifth Street, N.W.,
Washington, D.C 20549, and at the regional offices of the Commission located
in the Northwestern Atrium Center, 500 Madison Street, Suite 1400, Chicago,
Illinois 60661, and 7 World Trade Center, New York, New York 10048. Copies
should be available by mail upon payment of the Commission's customary
charges by writing to the Commission's principal offices at 450 Fifth Street,
N.W., Washington, D.C. 20549. The materials may also be reviewed through the
Commission's Web site (http://www.sec.gov.).

The Partnership was formed on February 11, 1986 under the laws of the
State of Delaware as an investment medium primarily for tax-exempt investors.
Its principal executive offices are located at 411 West Putnam Avenue, Suite
270, Greenwich, Connecticut 06830. Its telephone number is (203) 862-7444.
The Partnership was formed for the purpose of investing primarily in
participating mortgage loans and, to a lesser extent, land sale-leasebacks on
improved, income producing real estate. Under the Partnership Agreement, the
term of the Partnership will continue until December 31, 2010, unless sooner
terminated as provided in the Partnership Agreement or by law.

As of September 30, 1997, five mortgage loans (consisting of four first
mortgage loans and one wraparound mortgage loan) funded by the Partnership in
the aggregate amount of $20,450,000 were outstanding. In addition, on
October 31, 1997, the Partnership funded an additional first mortgage loan in
the principal amount of $6,500,000. The Partnership has also acquired,
either through foreclosure or deed in lieu of foreclosure, fee simple title
to two shopping centers and one office building. The following table sets
forth information with respect to outstanding mortgage loan investments made
by the Partnership as of September 30, 1997:

10
<PAGE>
<TABLE>
INTEREST CONTRACTUAL CARRYING
INTEREST RATE MORTGAGE RECOGNIZED BALANCE VALUE
----------------------- AMOUNT SEPT. 30, SEPT. 30, SEPT. 30,
DESCRIPTION CURRENT % ACCRUED % MATURITY DATE ADVANCED(1) 1997 1997(2) 1997(3)
- ----------- --------- --------- ------------- ----------- ---------- ----------- --------
SHOPPING
CENTERS
- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Lucky 8.41-10.00(5) 1.82-0(5) May 2005 $2,200,000 $ 166,154 $ 2,508,145 $ 2,240,580
Supermarket
Buena Park,
CA (4)

Avon Market 8.35 - April 2003 3,750,000 204,066 3,656,433 3,656,433
Ctr.
Avon, CO (6)
DVL, Inc. 12.00 - February 2000 2,000,000 99,266 820,932 820,932
(6)(7)

OFFICE
BUILDINGS
- -----------
Bank of 9.36-10.24 3.0-0 May 1998 8,500,000 958,972 16,845,828 8,535,960
California
Seattle, WA
(4)
Lionmark 8.5 - June 2003 4,000,000 249,676 3,907,525 3,907,525
Corp. Ctr.
Columbus, OH
(6)
----------- ---------- ----------- -----------
$20,450,000 $1,678,134 $27,738,863 $19,161,430
</TABLE>

1. All of the above mortgage loans are first mortgage loans except for the
Bank of California loan which is a wraparound mortgage loan, subordinate to
prior liens held by others with no recourse.
2. The contractual balance represents the original mortgage amount advanced
plus accrued interest calculated in accordance with the loan agreements,
less principal amortization received.
3. The carrying values of the above mortgage loans are inclusive of
acquisition fees and accrued interest recognized and allowance for loan
losses.
4. These loans are accounted for under the investment method.
5. In addition to the fixed interest, the Partnership is entitled to
contingent interest in an amount equal to a percentage of the rent received
by the borrower from the property securing the mortgage above a base
amount, payable annually, and/or a percentage of the excess of the value of
the property above a base amount, payable at maturity. Approximately
$6,000, $3,400 and $800 of contingent interest was earned during 1996,
1995, and 1994, respectively.
6. These loans are accounted for under the interest method.
7. This loan was made in February 1997. On July 30, 1997, the Partnership
received prepayment of $1,075,000, of which approximately $1,032,000 was
applied to the principal balance of the loan with the remainder applied to
interest and a yield maintenance fee.

11
<PAGE>

ADDITIONAL MORTGAGE LOAN INVESTMENT. On October 31, 1997, the Partnership
funded a first mortgage loan to Oliveye Hotel Limited Partnership in the
principal amount of $6,500,000. The loan has an annual interest rate of 11% and
is payable monthly. The loan is secured by the Crowne Plaza Hotel located in
Cincinnati, Ohio, and matures in October 2000.

REAL PROPERTY. The Partnership owns the following shopping centers and office
buildings which it acquired either through foreclosure proceedings or by
obtaining a deed-in-lieu of foreclosure.

Property Description
-------- -----------

Garfinkel Shopping Center 2 story facility with 93,384 rentable
Landover, Maryland sq. ft. located on 4.93 acres

Groton Shopping Center 118,938 gross leasable square feet
Groton, Connecticut located on 17 acres

Office Building 82,566 square foot building
Arlington, Texas

The Garfinkel Shopping Center, which was acquired by the Partnership on
December 21, 1992 in a foreclosure sale, is presently vacant. The building
contains asbestos and, as of September 30, 1997, the Partnership had an
unexpended asbestos reserve aggregating $443,050. The Partnership does not
plan to commence removal of the asbestos until a purchaser or tenant for the
property is identified. The Partnership also had an accrued common area
maintenance liability of $662,328 as of September 30, 1997. The property has
been marketed for sale or lease-up by the Partnership since it became vacant
in early 1993.

The Groton Shopping Center was acquired by foreclosure on December 9,
1993. It is a neighborhood strip shopping center which was approximately
76.6% occupied as of January 1, 1998.

The office building in Arlington was acquired by a deed-in-lieu of
foreclosure on September 30, 1997. The property is currently 100% occupied
and the Partnership has entered into a contract to sell the property for
$1,600,000.

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<PAGE>

REAL ESTATE AND ACCUMULATED DEPRECIATION. The following table sets forth as of
December 31, 1996 certain information with respect to the properties owned by
the Partnership.

<TABLE>
COSTS CAPITALIZED
INITIAL COST TO PARTNERSHIP SUBSEQUENT TO ACQUISITION GROSS AMOUNT AT CLOSE OF PERIOD
--------------------------- ------------------------- -------------------------------
BUILDINGS BUILDINGS
AND CARRYING AND WIRTE-DOWN FOR
DESCRIPTION ENCUMBRANCES LAND IMPROVEMENTS IMPROVEMENTS COSTS LAND IMPROVEMENTS IMPAIRMENT
- ----------- ------------ ---- ------------ ------------ -------- ---- ------------ --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Garfinkel
Shopping $ - $ 640,000 $2,560,000 $ - $84,404 $ 640,000 $2,644,404 $ -
Center
Landover, MD

Groton 1,820,000 5,177,786 (1,860,000)
Shopping - 1,820,000 4,680,000 497,786 -
Center ---------- ---------- -------- ---------- ---------- ------------
Groton, CT

TOTAL $ - $2,460,000 $7,240,000 $497,788 $84,404 $2,460,000 $7,822,190 $(1,860,000)
----- ---------- ---------- -------- ------- ---------- ---------- ------------
----- ---------- ---------- -------- ------- ---------- ---------- ------------
</TABLE>

<TABLE>
LIFE ON WHICH
LATEST INCOME
ACCUMULATED DATE OF DATE STATEMENT
TOTAL DEPRECIATION CONSTRUCTION ACQUIRED IS COMPUTED
----- ------------ ------------ -------- --------------
<S> <C> <C> <C> <C>
40 YEARS
STRAIGHT-LINE
$3,284,404 $265,140 N/A 12/21/92 METHOD

40 YEARS
STRAIGHT-LINE
5,137,786 379,892 N/A 12/9/93 METHOD
- ---------- --------

$8,422,190 $645,032
- ---------- --------
- ---------- --------
</TABLE>

13
<PAGE>

SELECTED FINANCIAL DATA. Set forth below is a summary of certain financial
information with respect to the Partnership for the periods indicated (dollars
in thousands except per unit amounts). The quarterly data is unaudited.
<TABLE>
NINE MONTHS ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
-------------------- -----------------------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 3,527 $ 3,586 $ 4,748 $ 4,130 $ 3,824 $ 4,115 $ 3,512

Net Income $ 3,287 $ 522 $ 1,244(5) $ 254(4) $ 1,864 $ 1,634(3) $ 1,296(2)

Net Income
Per Unit(1) $ .57 $ .09 $ .22(5) $ .04(4) $ .32 $ .28(3) $ .23(2)

Distributions
Per Unit(1) $ 0.33 $ .33 $ .44 $ .24 $ .28 $ .34 $ .24

Total Assets $50,274 $48,795 $48,916 $49,731 $50,607 $50,491 $50,295

Partner's Equity $48,337 $46,857 $46,947 $48,232 $49,358 $49,103 $49,424
</TABLE>

(1) Per Unit amounts were computed based on 5,690,843 Units.
(2) Net of provision for loan losses of $800 or $.14 per Unit.
(3) Net of provision for loan losses of $750 or $.13 per Unit.
(4) Net of write-down for impairment of $1,860 or $.32 per Unit.
(5) Net of provision for loan losses of $1,548 or $.27 per Unit.

14
<PAGE>

LITIGATION. On February 6, 1998, Everest Investors 8, LLC commenced an
action in the Superior Court of the State of California for the County of Los
Angeles against, among others, the Partnership and the General Partner. In
the action, Everest alleged, among other things, that the Partnership and the
General Partner breached the provisions of the Partnership Agreement by
refusing to recognize transfers to Everest of Units purportedly acquired
pursuant to the Everest Offer (the "Everest Tender Units"). Everest sought
injunctive relief (i) directing the recognition of the transfers to Everest
of the Everest Tender Units and the admission of Everest as a limited partner
with respect to the Everest Tender Units and (ii) enjoining the transfer of
the Everest Tender Units to any other party. Everest's motion for a
temporary restraining order was denied on February 6th. A hearing on a
preliminary injunction is scheduled for February 26th. The Partnership and
the General Partner believe that Everest's claims are without merit and
intend to vigorously contest the action.

SECTION 10. CONFLICTS OF INTEREST AND TRANSACTIONS WITH AFFILIATES.
The General Partner, the Purchaser and their affiliates have certain
conflicts of interest with respect to the Offer as set forth below.

VOTING BY THE PURCHASER. As a result of the Offer, the Purchaser may be
in a position to significantly influence all Partnership decisions on which
Unitholders may vote. This means that (i) non-tendering Unitholders could be
prevented from taking action they desire but that the Purchaser opposes and
(ii) the Purchaser may be able to take action desired by the Purchaser but
opposed by non-tendering Unitholders. (See "Section 7. Effects of the
Offer".)

TRANSACTIONS WITH AFFILIATES. For management of the affairs of the
Partnership, Resources Capital Corp., the Administrative General Partner, is
entitled to receive a management fee equal to 1.75% per annum of the average
month-end net asset value of the Partnership. For the years ended December
31, 1996, 1995 and 1994 and the nine months ended September 30, 1997, the
Administrative General Partner earned $775,060, $736,256, $743,736 and
$540,290, respectively.

For the servicing of mortgage loans made by the Partnership, Resources
Pension Advisory Corp., the Investment General Partner, is entitled to
receive a mortgage servicing fee of 1/4 of 1% per annum of the principal
balances loaned. During the years ended December 31, 1996, 1995 and 1994 and
the nine months ended September 30, 1997, the Investment General Partner
earned $76,184, $64,149, $67,725 and $50,996, respectively.

On December 9, 1993, the Partnership entered into a supervisory
management agreement with Resources Supervisory Management Corp. ("RSMC"), an
affiliate of the General Partner, to perform certain functions relating to
supervising the management of the Groton property. As such, RSMC is entitled
to receive as compensation for its supervisory management services, the
greater of 6% of annual gross revenues from the Groton property when leasing
services are performed or 3% of gross revenue when no leasing services are
performed. During 1994, RSMC entered into an agreement with an unaffiliated
local management company to perform such services on behalf of the
Partnership. The terms of this agreement are substantially the same as the
agreement entered into between the Partnership and RSMC. There was no
supervisory management fee earned by RSMC for the years ended December 31,
1996, 1995 and 1994, or for the quarterly period ended September 30, 1997.

The General Partner is allocated 1% of net income, loss and cash flow
distributions of the Partnership.

SECTION 11. CERTAIN INFORMATION CONCERNING THE PURCHASER. The
Purchaser, a newly-formed Delaware corporation, was formed for the purpose of
acquiring Units in the Offer. The Purchaser is indirectly wholly-owned by
Presidio Capital Corp. ("Presidio"). The principal executive offices of the
Purchaser are located at 411 West Putnam Avenue, Greenwich, Connecticut
06830.

Presidio is a British Virgin Islands corporation, the Class A common
shares of which are registered under Section 12(g) of the Exchange Act.
Presidio was formed to purchase substantially all of the assets of Integrated
Resources Inc. ("Integrated") in November 1994 pursuant to Integrated's plan
of reorganization under Chapter 11 of the United States Bankruptcy Code.
Presidio acquired control of the General Partner as part of such transaction.

15
<PAGE>

For certain information concerning the executive officers and directors
of the Purchaser and Presidio, see Schedule 1 to this Offer to Purchase.

Except as otherwise set forth herein, (i) neither the Purchaser,
Presidio, to the best of Purchaser's knowledge, the persons listed on
Schedule 1, nor any affiliate of the foregoing beneficially owns or has a
right to acquire any Units, (ii) neither the Purchaser, Presidio, to the best
of Purchaser's knowledge, the persons listed on Schedule 1, nor any affiliate
thereof or director, executive officer or subsidiary of the Purchaser or
Presidio has effected any transaction in the Units within the past 60 days,
(iii) neither the Purchaser, Presidio, to the best of Purchaser's knowledge,
any of the persons listed on Schedule 1, nor any director or executive
officer of the Purchaser or Presidio, has any contract, arrangement,
understanding or relationship with any other person with respect to any
securities of the Partnership, including, but not limited to, contracts,
arrangements, understandings or relationships concerning the transfer or
voting thereof, joint ventures, loan or option arrangements, puts or calls,
guarantees of loans, guarantees against loss or the giving or withholding of
proxies, (iv) there have been no transactions or business relationships which
would be required to be disclosed under the rules and regulations of the
Commission between any of the Purchaser, Presidio, or, to the best of
Purchaser's knowledge, the persons listed on Schedule 1, on the one hand, and
the Partnership or its affiliates, on the other hand, and (v) there have been
no contracts, negotiations or transactions between the Purchaser, Presidio,
or, to the best of Purchaser's knowledge, the persons listed on Schedule 1,
on the one hand, and the Partnership or its affiliates, on the other hand,
concerning a merger, consolidation or acquisition, tender offer or other
acquisition of securities, an election of directors or a sale or other
transfer of a material amount of assets.

Between December 8, 1997 and February 11, 1998, Presidio Partnership II
Corp., an affiliate of the Purchaser, acquired an aggregate of 23,189.44
Units in secondary market transactions at prices ranging from $5.50 to $5.70
per Unit.

SECTION 12. SOURCE OF FUNDS. A maximum of $12,000,000 (exclusive of
fees and expenses) would be required to purchase the Units sought in the
Offer, if tendered. The Purchaser presently contemplates that it will obtain
the funds necessary to consummate the Offer (including fees and expenses)
from capital contributions directly or indirectly from Presidio, which has a
net worth substantially in excess of the amount required to purchase the
Units.

SECTION 13. PURCHASE PRICE CONSIDERATIONS.

The Purchaser has set the Purchase Price at $6.00 net per Unit. The
Purchaser established the Purchase Price by analyzing a number of
quantitative and qualitative factors, including: (i) recent secondary market
prices; (ii) the lack of liquidity of an investment in the Partnership; and
(iii) the estimated Net Asset Value per Unit.

Secondary sales activity for the Units, including privately negotiated
sales, has been limited and sporadic. At present, privately negotiated sales
and sales through intermediaries are the only means available to a Unitholder
to liquidate an investment in Units (other than the Offer) because the Units
are not listed or traded on any exchange or quoted on any Nasdaq list or
system. According to Partnership Spectrum, an independent third party
industry publication, between October 1, 1997 and November 30, 1997, there
were only 16 reported trades in the secondary market (for a total of 12,592
Units) which were made at between a high of $5.50 per Unit and a low of $4.80
per Unit, with a weighted average price of $5.25 per Unit. Such prices do
not take into account commissions and other transactional costs payable by
sellers of Units (which typically range between 8% and 10% of the reported
selling price). ASSUMING COMMISSIONS AND TRANSACTIONAL COSTS OF 9%,
UNITHOLDERS WOULD RECEIVE $4.78 OF THE $5.25 WEIGHTED AVERAGE SELLING PRICE
REFERRED TO ABOVE. Unitholders who tender their Units will not be obligated
to pay any commissions or Partnership transfer fees. In addition, although
not reported in Partnership Spectrum, an affiliate of the Purchaser acquired
approximately 6,697 Units during the aforementioned period for $5.70 per Unit.

In the latter part of 1997, Everest Investors 8, LLC, an independent
third party, commenced an offer to purchase up to 4.9% of the outstanding
Units for $5.00 per Unit. The Everest Offer expired on December 19, 1997.
The General Partner informed Unitholders that a transfer of Units pursuant to
the Everest Offer would be in violation

16
<PAGE>

of the Partnership Agreement, and subsequently notified Everest that
transfers pursuant to the Everest Offer would not be recognized. (See
"Section 9. Certain Information Concerning the Partnership." for information
with respect to an action commenced by Everest against, among others, the
Partnership and the General Partner.)

THE PURCHASER IS OFFERING TO PURCHASE UNITS WHICH ARE A RELATIVELY
ILLIQUID INVESTMENT AND IS NOT OFFERING TO PURCHASE THE PARTNERSHIP'S
UNDERLYING ASSETS. Consequently, the Purchaser does not believe that the
underlying asset value of the Partnership is determinative in arriving at the
Purchase Price. Nevertheless, using the following methodology, the Purchaser
derived an estimated net asset value for the Partnership.

With respect to the Partnership's mortgage investments, in estimating
the Net Asset Value, the Purchaser valued four of the six mortgages (Avon
Market Center, DVL, Inc., Lionmark Corporate Center and Crowne Plaza) at the
contractual balances for such mortgages as of September 30, 1997 (November 1,
1997 with respect to Crowne Plaza) (which contractual balances were
$3,656,433, $820,932, $3,907,525 and $6,500,000, respectively), based on the
Purchaser's belief that the underlying property values of these mortgages are
sufficient to enable the applicable mortgagor to satisfy the mortgage. The
contractual balance represents the original mortgage amount advanced plus
accrued interest calculated in accordance with the loan agreements, less
principal amortization received. The Purchaser valued the Lucky Supermarket
mortgage, which as of September 30, 1997 had a contractual balance of
$2,508,145, at $2,120,000 (representing a 15.5% discount from the contractual
balance) based on the Purchaser's belief that the underlying property value
of this mortgage may not be sufficient to enable the mortgagor to satisfy the
mortgage. The Purchaser arrived at such conclusion by dividing the
annualized net operating income of the property as of September 30, 1997 of
$254,407 by a 12% capitalization rate. The Partnership valued the Bank of
California mortgage, which as of September 30, 1997 had a contractual balance
of $16,845,828, at $11,792,080 (representing a 30% discount from the
contractual balance). The mortgagor at the Bank of California property filed
for bankruptcy protection in August 1993 and a Plan of Reorganization with
respect to the mortgagor was approved in September 1995. The mortgage is
scheduled to be paid by June 1998, but pursuant to the Plan of Reorganization
may be extended for an additional three year period upon payment of an
extension fee to the Partnership. While the Purchaser believes that the
value of the property underlying the Bank of California mortgage is
sufficient to enable the mortgagor to satisfy the contractual balance of the
mortgage in full, as a result of uncertainties relating to the mortgagor
bankruptcy the Purchaser has valued the Bank of California mortgage at a
discount from its contractual balance. As a result of the foregoing
analysis, the Purchaser estimates the aggregate value of the Partnership's
mortgage investments at $28,796,970.

With respect to the Arlington, Texas property, in determining the Net
Asset Value, the Purchaser reduced the $1,600,000 contractual sales price for
the property by estimated selling expenses of $200,000, resulting in an
estimated value of $1,400,000. The Purchaser estimated the value of the
Groton Shopping Center by dividing the property's net operating income for
1997 (actual property revenues minus actual property expenses during such
period), by a 12% capitalization rate, resulting in an estimated value of
$5,163,800. The Purchaser estimated the value of the Garfinkel Shopping
Center (which is vacant) by dividing estimated income for such property
(based on market rent of $2.25 per square foot), by an 10.5% capitalization
rate. This amount was then reduced to account for (i) estimated leasing
costs of $251,692, (ii) estimated asbestos removal costs of $443,050, (iii)
estimated roof repair costs of $99,384 and (iv) accrued common area
maintenance charges of $662,328, resulting in a value of $544,632 for the
Garfinkel Shopping Center. As a result of the foregoing analysis, the
Purchaser estimates the aggregate value of the Partnership's real estate
properties at $7,108,432.

THE PURCHASER BELIEVES THAT THE CONTRACTUAL BALANCE DISCOUNTS,
CAPITALIZATION RATES AND OTHER ASSUMPTIONS USED BY IT ARE WITHIN RANGES WHICH
ARE APPROPRIATE FOR VALUING THE PARTNERSHIP'S ASSETS. THE UTILIZATION OF
DIFFERENT DISCOUNTS, CAPITALIZATION RATES AND ASSUMPTIONS COULD ALSO BE
APPROPRIATE. IN THIS REGARD, UNITHOLDERS SHOULD BE AWARE THAT THE USE OF
LOWER DISCOUNTS AND CAPITALIZATION RATES WOULD RESULT IN A HIGHER VALUE FOR
THE PARTNERSHIP'S MORTGAGE AND REAL ESTATE INVESTMENTS, RESPECTIVELY.
SIMILARLY, AN INCREASE IN NET OPERATING INCOME OR MARKET RENTS WOULD RESULT
IN HIGHER VALUES FOR THE PARTNERSHIP'S REAL ESTATE PROPERTIES. FURTHER,
UNITHOLDERS SHOULD UNDERSTAND THAT WHILE THE PURCHASER EMPLOYED THE
METHODOLOGY DESCRIBED IN THIS SECTION 13 IN DETERMINING THE NET ASSET VALUE,
THERE MAY BE ALTERNATIVE VALUATION METHODS THAT WOULD YIELD DIFFERING VALUES.

17
<PAGE>

To determine the Net Asset Value per Unit, the Purchaser added to the
$35,905,402 aggregate value of the Partnership's investments, the $14,405,461
of estimated net current assets and liabilities of the Partnership as of
December 31, 1997 (including as a liability for such purposes, the $.11 per
Unit distribution to be paid by the Partnership during the first quarter of
1998), resulting in a Net Asset Value per Unit of approximately $8.75 (based
upon the percentage of proceeds to which Unitholders are entitled).

The Purchaser believes that realization of the Net Asset Value by the
Partnership may be impacted by factors generally affecting real estate. In
addition, other than with respect to the Arlington, Texas property, the Net
Asset Value per Unit does not reflect costs associated with liquidating the
Partnership's assets. The Partnership is not required to liquidate for a
number of years, and, except for the Garfinkel Shopping Center and the
Arlington, Texas property, the General Partner does not have any present
plans or intentions to sell any of the Partnership's investments. The
Partnership is also actively seeking new investment opportunities.

Pursuant to the provisions of the Partnership Agreement, the General
Partner provides Unitholders with estimates of the fair market value of the
Partnership's assets in order to enable Unitholders to comply with ERISA
reporting requirements. As of December 31, 1996, the General Partner
estimated a value of $8.26 per Unit. The General Partner has most recently
estimated the value as of September 30, 1997 at $8.33 per Unit. The
foregoing estimates were based on the book value of the Partnership's assets,
determined in accordance with generally accepted accounting principles, as of
such dates.

The Purchase Price represents the price at which the Purchaser is
willing to purchase Units. No independent person has been retained to
evaluate or render any opinion with respect to the fairness of the Purchase
Price and no representation is made by the Purchaser, the General Partner or
any affiliate of the Purchaser or the General Partner as to such fairness.
Other measures of the value of the Units may be relevant to Unitholders.
Unitholders are urged to consider carefully all of the information contained
herein and consult with their own advisors, tax, financial or otherwise, in
evaluating the terms of the Offer before deciding whether to tender Units.

SECTION 14. CONDITIONS OF THE OFFER. Notwithstanding any other term of
the Offer, the Purchaser shall not be required to accept for payment or to
pay for any Units tendered if all authorizations, consents, orders or
approvals of, or declarations or filings with, or expirations of waiting
periods imposed by, any court, administrative agency or commission or other
governmental authority or instrumentality, domestic or foreign, necessary for
the consummation of the transactions contemplated by the Offer shall not have
been filed, occurred or been obtained. Furthermore, notwithstanding any
other term of the Offer, the Purchaser shall not be required to accept for
payment or pay for any Units not theretofore accepted for payment or paid for
and may terminate or amend the Offer as to such Units if, at any time on or
after the date of the Offer and before the acceptance of such Units for
payment or the payment therefor, or the later thereof, as applicable and as
determined by the Purchaser, any of the following conditions exists:

(a) a preliminary or permanent injunction or other order of any
federal or state court, government or governmental authority or agency
shall have been issued and shall remain in effect which (i) makes illegal,
delays or otherwise directly or indirectly restrains or prohibits the
making of the Offer or the acceptance for payment of or payment for any
Units by the Purchaser, (ii) imposes or confirms limitations on the ability
of the Purchaser effectively to exercise full rights of ownership of any
Units, including, without limitation, the right to vote any Units acquired
by the Purchaser pursuant to the Offer or otherwise on all matters properly
presented to the Partnership's Unitholders, (iii) requires divestiture by
the Purchaser of any Units, (iv) causes any material diminution of the
benefits to be derived by the Purchaser as a result of the transactions
contemplated by the Offer, or (v) might materially adversely affect the
business, properties, assets, liabilities, financial condition, operations,
results of operations or prospects of the Purchaser or the Partnership;

(b) there shall be any action taken, or any statute, rule, regulation
or order proposed, enacted, enforced, promulgated, issued or deemed
applicable to the Offer by any federal or state court, government

18
<PAGE>

or governmental authority or agency, which might, directly or indirectly,
result in any of the consequences referred to in clauses (i) through (v) of
paragraph (a) above;

(c) any change or development shall have occurred or been threatened
since the date hereof, in the business, properties, assets, liabilities,
financial condition, operations, results of operations or prospects of the
Partnership, which, in the reasonable judgment of the Purchaser, is or may
be materially adverse to the Partnership, or the Purchaser shall have
become aware of any fact that, in the reasonable judgment of the Purchaser,
does or may have a material adverse effect on the value of the Units;

(d) there shall have occurred (i) any general suspension of trading
in, or limitation on prices for, securities on any national securities
exchange or in the over-the-counter market in the United States, (ii) a
declaration of a banking moratorium or any suspension of payments in
respect of banks in the United States, (iii) any limitation by any
governmental authority on, or other event which might affect, the extension
of credit by lending institutions or result in any imposition of currency
controls in the United States, (iv) a commencement of a war or armed
hostilities or other national or international calamity directly or
indirectly involving the United States, (v) a material change in United
States or other currency exchange rates or a suspension of a limitation on
the markets thereof, or (vi) in the case of any of the foregoing existing
at the time of the commencement of the Offer, a material acceleration or
worsening thereof; or

(e) there shall have been threatened, instituted or pending any
action or proceeding before any court or government agency or other
regulatory or administrative agency or commission or by any other person
challenging the acquisition of any Units pursuant to the Offer, or
otherwise directly or indirectly relating to the Offer, or otherwise, in
the reasonable judgment of the Purchaser, adversely affecting the Purchaser
or the Partnership.

The foregoing conditions are for the sole benefit of the Purchaser and
may be asserted by the Purchaser regardless of the circumstances giving rise
to such conditions or may be waived by the Purchaser in whole or in part at
any time and from time to time in its sole discretion. Any determination by
the Purchaser concerning the events described above will be final and binding
upon all parties. Notwithstanding anything to the contrary set forth in this
Section 14, all conditions set forth in this Section 14 must be satisfied or
waived prior to the Expiration Date.

SECTION 15. CERTAIN LEGAL MATTERS.

GENERAL. Except as set forth in this Section 15, the Purchaser is not
aware of any filings, approvals or other actions by any domestic or foreign
governmental or administrative agency that would be required prior to the
acquisition of Units by the Purchaser pursuant to the Offer. Should any such
approval or other action be required, it is the Purchaser's present intention
that such additional approval or action would be sought. While there is no
present intent to delay the purchase of Units tendered pursuant to the Offer
pending receipt of any such additional approval or the taking of any such
action, there can be no assurance that any such additional approval or
action, if needed, would be obtained without substantial conditions or that
adverse consequences might not result to the Partnership's business, or that
certain parts of the Partnership's business might not have to be disposed of
or held separate or other substantial conditions complied with in order to
obtain such approval or action, any of which could cause the Purchaser to
elect to terminate the Offer without purchasing Units thereunder. The
Purchaser's obligation to purchase and pay for Units is subject to certain
conditions, including conditions related to the legal matters discussed in
this Section 15.

ANTITRUST. The Purchaser does not believe that the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, is applicable to the
acquisition of Units contemplated by the Offer.

MARGIN REQUIREMENTS. The Units are not "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System and,
accordingly, such regulations are not applicable to the Offer.

19
<PAGE>

STATE TAKEOVER LAWS. A number of states have adopted anti-takeover laws
which purport, to varying degrees, to be applicable to attempts to acquire
securities of corporations which are incorporated in such states or which
have substantial assets, securityholders, principal executive offices or
principal places of business therein. Although the Purchaser has not
attempted to comply with any state anti-takeover statutes in connection with
the Offer, the Purchaser reserves the right to challenge the validity or
applicability of any state law allegedly applicable to the Offer and nothing
in this Offer to Purchase nor any action taken in connection herewith is
intended as a waiver of such right. If any state anti-takeover statute is
applicable to the Offer, the Purchaser might be unable to accept for payment
or purchase Units tendered pursuant to the Offer or be delayed in continuing
or consummating the Offer. In such case, the Purchaser may not be obligated
to accept for purchase or pay for any Units tendered.

SECTION 16. FEES AND EXPENSES. Except as set forth in this Section 16,
the Purchaser will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of Units pursuant to the Offer. The
Purchaser has retained The Herman Group, Inc., to act as Information Agent
and as Depositary in connection with the Offer. The Purchaser will pay The
Herman Group, Inc. reasonable and customary compensation for its respective
services in connection with the Offer, plus reimbursement for out-of-pocket
expenses. The Purchaser will also pay all costs and expenses of printing and
mailing the Offer and its legal fees and expenses.

SECTION 17. MISCELLANEOUS. The Purchaser is not aware of any
jurisdiction in which the making of the Offer is not in compliance with
applicable law. If the Purchaser becomes aware of any jurisdiction in which
the making of the Offer would not be in compliance with applicable law, the
Purchaser will make a good faith effort to comply with any such law. If,
after such good faith effort, the Purchaser cannot comply with any such law,
the Offer will not be made to (nor will tenders be accepted from or on behalf
of) the holders of Units residing in such jurisdiction.

No person has been authorized to give any information or to make any
representation on behalf of the Purchaser not contained herein or in the
Letter of Transmittal and, if given or made, such information or
representation must not be relied upon as having been authorized.

The Purchaser has filed with the Commission a Schedule 14D-1, pursuant
to Rule 14d-3 under the Exchange Act, furnishing certain additional
information with respect to the Offer, and may file amendments thereto. The
Schedule 14D-1 and any amendments thereto, including exhibits, may be
inspected and copies may be obtained at the same places and in the same
manner as set forth in Section 9 hereof (except that they will not be
available at the regional offices of the Commission).

20
<PAGE>

Appendix A
GLOSSARY
--------

BUSINESS DAY: Any day other than Saturday, Sunday or a federal holiday, and
consists of the time period from 12:01 a.m. through 12:00 Midnight, New York
City time

CODE: The Internal Revenue Code of 1986, as amended

COMMISSION: The Securities and Exchange Commission

DEPOSITARY: The Herman Group, Inc.

ELIGIBLE INSTITUTION: A member firm of a registered national securities
exchange, a member of the National Association of Securities Dealers, Inc., a
commercial bank, savings bank, credit union, savings and loan association or
trust company having an office, branch or agency in the United States

EXCHANGE ACT: Securities Exchange Act of 1934, as amended

EXPIRATION DATE: 12:00 Midnight, New York City Time on March 17, 1998,
unless and as extended

GENERAL PARTNER: Resources Capital Corp., Presidio AGP Corp. and Resources
Pension Advisory Corp., collectively, the general partners of the Partnership

INFORMATION AGENT: The Herman Group, Inc.

NET ASSET VALUE: The Purchaser's estimate of the net asset value of the
Partnership, as determined in Section 13 of the Offer to Purchase

OFFER: This offer of the Purchaser set forth in this Offer to Purchase and
the related Letter of Transmittal, as each may be supplemented or amended
from time to time

OFFER TO PURCHASE: This Offer of the Purchaser, dated February 18, 1998.

PARTNERSHIP: Resources Pension Shares 5, L.P.

PURCHASE PRICE: The amount of cash paid to each Unitholder for each Unit
tendered upon consummation of the Offer

PURCHASER: Presidio RPS Acquisition Corp.

TIN: Taxpayer identification number

UNITHOLDERS: Holders of Units

UNITS: Units of Limited Partnership Interest

<PAGE>

SCHEDULE 1

INFORMATION WITH RESPECT TO THE EXECUTIVE OFFICERS
AND DIRECTORS OF THE PURCHASER AND PRESIDIO CAPITAL CORP.

Set forth below is the name, current business address, present principal
occupation, and employment history for at least the past five years of each
director and executive officer of the Purchaser and Presidio Capital Corp. Each
person listed below is a citizen of the United States.

PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
MATERIAL OCCUPATION, POSITION, OFFICE
OR EMPLOYMENT FOR THE PAST FIVE YEARS
-------------------------------------

David King, 35, has been an Executive Vice President, a director and
Assistant Treasurer of Presidio since November 1997 and a director and the
President and Chief Executive Officer of the Purchaser since February 1998. He
is also an officer of the General Partner. Mr. King joined Northstar Capital
Partners LLC, a real estate investment company, in November 1997. Previously he
was a Senior Vice President of Finance at Olympia & York Companies (USA). Prior
to joining Olympia & York in 1990, Mr. King worked for Bankers Trust in its real
estate finance group. Mr. King's current business address is 527 Madison
Avenue, New York, New York 10022.

Allan B. Rothschild, 36, has been an Executive Vice President of Presidio
since December 1997 and a director, vice president and the Secretary of the
Purchaser since February 1998. He is also an officer of the General Partner.
Mr. Rothschild joined Northstar Presidio Management Company, LLC, an affiliate
of Northstar Capital Partners LLC, in December 1997. Previously he was the
Senior Vice President and General Counsel of Newkirk Limited Partnership where
he managed a large portfolio of net-leased real estate assets. Prior to joining
Newkirk, Mr. Rothschild was associated with the law firm of Proskauer, Rose LLP
in its real estate group. Mr. Rothschild's current business address is 411 West
Putnam Avenue, Suite 270, Greenwich, Connecticut 06830.

Lawrence R. Schacter, 41, has been Senior Vice President and Chief
Financial Officer of Presidio since January 1998 and a director and vice
president of the Purchaser since February 1998. He is also an officer of the
General Partner. Mr. Schacter joined Northstar Presidio Management Company,
LLC, an affiliate of Northstar Capital Partners LLC, in 1998. Previously he was
the Controller at CB Commercial/Hampshire, LLC from 1996 to 1997. Prior to
joining CB, Mr. Schacter held the position of Controller at Goodrich Associates
in 1996 and at Greenthal/Harlan Realty Services Co. from 1992 to 1995. Mr.
Schacter, who holds a CPA, graduated from Miami University (Ohio). Mr.
Schacter's current business address is 411 West Putnam Avenue, Suite 270,
Greenwich, Connecticut 06830.

Charles Humber, 24, has been a Vice President of Presidio since November
1997 and a Vice President of the Purchaser since February 1998. He is also an
officer of the General Partner. Mr. Humber joined Northstar Capital Partners
LLC in September 1997. Previously he worked for Merrill Lynch's Real Estate
Investment Banking Group from 1996 to 1997. Mr. Humber graduated from Brown
University with a B.A. in international relations and organizational behavior
and management which is where he was prior to 1996. Mr. Humber's current
business address is 527 Madison Avenue, New York, New York 10022.

Kevin Reardon, 39, has been a Vice President, Secretary, Treasurer and a
director of Presidio since November 1997. Mr. Reardon joined Northstar Capital
Partners LLC in 1997. He is also an officer of the General Partner.
Previously he was the Controller at Lazard Freres Realty Estate Investors from
1996 to 1997. Prior to joining Lazard Freres, Mr. Reardon was the Director of
Finance in charge of European expansion at the law firm of Dewey Ballantine from
1993 to 1996. Prior to 1993, Mr. Reardon held a financial position at Hearst -
ABC -

<PAGE>

Viacom Entertainment Services. Mr. Reardon, who hold a CPA, graduated from
Fordham University with a B.S. in Accounting. Mr. Reardon's current business
address is 527 Madison Avenue, New York, New York 10022.

Richard Sabella, 42, has been the President and a director of Presidio
since November 1997. Mr. Sabella joined Northstar Capital Partners LLC in
November 1997. He is also an officer of the General Partner. Previously he
was the head of real estate and a partner at the law firm of Cahill, Gordon &
Reindel since 1989. Mr. Sabella has also been associated with the law firms
of Milgrim, Thomajian, Jacobs & Lee, P.C. and Cravath, Swaine & Moore. Mr.
Sabella's current business address is 527 Madison Avenue, New York, New York
10022.

W. Edward Scheetz, 33, has been a director of Presidio since November
1997. Mr. Scheetz co-founded Northstar Capital Partners LLC with David
Hamamoto in July 1997. He is also an officer of the General Partner.
Previously he was a partner at Apollo Real Estate Advisors L.P. since 1993.
From 1988 to 1993, Mr. Scheetz was a principal with Trammell Crow Ventures.
Mr. Scheetz' current business address is 527 Madison Avenue, New York, New
York 10022.

David Hamamoto, 38, has been a director of Presidio since November 1997.
Mr. Hamamoto co-founded Northstar Capital Partners LLC with W. Edward Scheetz
in July 1997. He is also an officer of the General Partner. Previously he
was a partner and co-head of the Real Estate Principal Investment Area at
Goldman, Sachs & Co., where he initiated the effort to build a real estate
principal investment business in 1988 under the auspices of the Whitehall
Funds. Mr. Hamamoto's current business address is 527 Madison Avenue, New
York, New York 10022.

<PAGE>

The Letter of Transmittal and any other required documents should be sent
or delivered by each Unitholder or his broker, dealer, commercial bank, trust
company or other nominee to the Depositary at the address set forth below:

THE HERMAN GROUP, INC.

By Hand, Mail or Overnight Delivery: 2121 San Jacinto Street
26th Floor
Dallas, Texas 75201

By Facsimile: (214) 999-9348 or (214) 999-9323

For Telephone Information contact the Information Agent at:

(800) 992-6209

Any questions or requests for assistance or for additional copies of
this Offer to Purchase, the Letter of Transmittal and other tender offer
materials may be directed to the Purchaser at the telephone number and
address listed above. You may also contact your broker for assistance
concerning the Offer.

<PAGE>

LETTER OF TRANSMITTAL
OF
UNITS OF LIMITED PARTNERSHIP INTEREST
OF
RESOURCES PENSION SHARES 5, L.P.

(PLEASE INDICATE CHANGES OR CORRECTIONS TO THE NAME, ADDRESS OR TAXPAYER
I.D.NUMBER)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL EXPIRES AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON MARCH 17, 1998 (THE "EXPIRATION DATE")
UNLESS EXTENDED.

To participate in the Offer, a duly executed copy of this Letter of
Transmittal and any other documents required by this Letter of Transmittal
must be received by the Depositary on or prior to the Expiration Date.
Delivery of this Letter of Transmittal or any other required documents to an
address or facsimile number other than as set forth below does not constitute
valid delivery. The method of delivery of all documents is at the election
and risk of the tendering Unitholder. Please use the pre-addressed,
postage-paid envelope provided.

This Letter of Transmittal is to be completed by Unitholders of
Resources Pension Shares 5, L.P., a Delaware limited partnership (the
"Partnership"), pursuant to the procedures set forth in the Offer to Purchase
(as defined below) and the Instructions attached hereto. Capitalized terms
used herein and not defined herein have the meanings ascribed to such terms
in the Offer to Purchase.

PLEASE CAREFULLY READ THE ACCOMPANYING INSTRUCTIONS

Gentlemen:

The undersigned hereby tenders to Presidio RPS Acquisition Corp. (the
"Purchaser"), a Delaware corporation, with an address at 411 West Putnam
Avenue, Greenwich, Connecticut 06830, the number of units of limited
partnership interest ("Units") of the Partnership set forth above (unless an
indication is made in the signature box that less than all of such Units are
being tendered) for a purchase price equal to $6.00 per Unit, net to the
seller in cash, without interest, upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated February 18, 1998 (the
"Offer to Purchase") and this Letter of Transmittal, as each may be
supplemented or amended from time to time (which together constituted the
"Offer"). Receipt of the Offer to Purchase is hereby acknowledged.

The undersigned recognized that, if more than 2,000,000 Units are
validly tendered prior to or on the Expiration Date and not properly
withdrawn, the Purchaser will, upon the terms of the Offer, accept for
payment from among those Units tendered prior to or on the Expiration Date
2,000,000 Units on a pro rata basis based upon the number of Units validly
tendered prior to or on the Expiration Date and not withdrawn (with
adjustments to avoid purchases of certain fractional Units and to comply with
the provisions of the Partnership Agreement which prohibit any Unitholder
from holding less than 100 Units).

Subject to and effective upon acceptance for payment of any of the Units
tendered hereby, the Undersigned hereby sells, assigns and transfers to, or
upon the order of, Purchaser all right, title and interests in and to such
Units which are purchased pursuant to the Offer. The undersigned hereby
irrevocably constitutes and appoints the Purchaser as the true and lawful
agent and attorney-in-fact of the undersigned with respect to such Units,
with full power of substitution (such power of attorney being deemed to be an
irrevocable power coupled with an interest), to deliver such Units and
transfer ownership of such Units on the books of the Partnership, together
with all accompanying evidences of transfer and authenticity, including,
without limitation, any documents or instruments required to be executed
under a "Transferor's (Seller's) Application for Transfer" created by the
NASD, if required, to or upon the order of the Purchaser and, upon payment of
the purchase price in respect of such Units by the Purchaser, to receive all
benefits and otherwise exercise all rights of beneficial ownership of such
Units, including all voting rights, all in accordance with the terms of the
Offer. Upon the purchase of Units pursuant to the Offer, all prior proxies
and consents given by the undersigned with respect to such Units will be
revoked and no subsequent proxies or consents may be given (and if given will
not be deemed effective). In addition, by executing this Letter of
Transmittal, the undersigned assigns to the Purchaser all of the
undersigned's right to receive distributions from the Partnership with
respect to Units which are purchased pursuant to the Offer other than as
otherwise provided in the Offer to Purchase. If legal title to the Units is
held through an IRA or KEOGH or similar account, the Unitholder understands
that this Letter of Transmittal must be signed by the custodian of such IRA
or KEOGH account and the Unitholder hereby authorized and directs the
custodian of such IRA or KEOGH to confirm this Letter of Transmittal. This
Power of Attorney shall not be affected by the subsequent mental disability
of the Unitholder, and the Purchaser shall not be required to post a bond in
any nature in connection with this Power of Attorney.

The undersigned hereby represents and warrants that the undersigned owns
the Units tendered hereby within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934, as amended, and has full power and authority
to validly tender, sell, assign and transfer the Units tendered hereby, and
that when any such Units are purchased by the Purchaser, the Purchaser will
acquire good, marketable and unencumbered title thereto, free and clear of
all liens, restrictions, charges, encumbrances, conditional sales agreements
or other obligations relating to the sale or transfer thereof, and such Units
will not be subject to any adverse claim. Upon request, the undersigned will
execute and deliver any additional documents deemed by the Purchaser to be
necessary or desirable to complete the assignment, transfer, or purchase of
Units tendered hereby. The undersigned understands that a tender of Units to
the Purchaser will constitute a binding agreement between the undersigned and
the Purchaser upon the terms and subject to the conditions of the Offer. The
undersigned recognizes that under certain circumstances set forth in the
Offer to Purchase, the Purchaser may not be required to accept for payment
any of the Units tendered hereby. In such event, the undersigned understands
that any Letter of Transmittal for Units not accepted for payment will be
destroyed by the Purchaser. All authority herein conferred or agreed to be
conferred shall survive the death or incapacity of the undersigned and any
obligations of the undersigned shall be binding upon the heirs, personal
representatives, successors and assigns of the undersigned. Except as stated
in the Offer to Purchase, this tender is irrevocable.

<PAGE>

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SIGNATURE BOX
(SEE INSTRUCTIONS 2, 3 AND 4 AS NECESSARY)
- -------------------------------------------------------------------------------
To tender, please sign exactly as your name is printed on the front of this
Letter of Transmittal. For joint owners, each joint owner must sign. (SEE
INSTRUCTION 2.) TRUSTEES, EXECUTORS, ADMINISTRATORS, GUARDIANS,
ATTORNEYS-IN-FACT, OFFICERS OF A CORPORATION OR OTHER PERSONS ACTING IN A
FIDUCIARY OR REPRESENTATIVE CAPACITY SIGN BELOW AND SEE INSTRUCTION 2. The
signatory hereto hereby certifies under penalties of perjury the Taxpayer
I.D. number printed (or corrected) on the front page of this Letter of
Transmittal and the statements in Box A, Box B and, if applicable, Box C.

X X
--------------------------------- ---------------------------------
(SIGNATURE) (SIGNATURE - JOINT OWNER, IF ANY)

Number of Units Tendered:
------------------------------
(If no indication is made, all Units will be deemed tendered.)

Name and Capacity (if other than individuals):
---------------------------------
(Title)
-----------------------

Address (Fiduciaries Only):
----------------------------------------------------
(city) (state) (zip)

Area Code and Telephone No. ( ) (Day) ( ) (Evening)
---------------- --------------

NOTARIZATION OF SIGNATURE
(See Instruction 2)

STATE OF )
------------
) SS.:
COUNTY OF )
-----------

On this ____ day of _____________, 1998, before me came personally
______________________________ to me know to be the person who executed this
(Please Print)
Letter of Transmittal.

-----------------------------
Notary Public
OR

SIGNATURE GUARANTEE
(See Instruction 2)

Name and Address of Eligible Institution
---------------------------------------

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

Authorized Signature Title
---------------------------- ----------------------

Name Date , 1998
--------------------------------- --------------------

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

DELIVER TO:

THE HERMAN GROUP, INC.
2121 SAN JACINTO STREET, 26TH FLOOR
DALLAS, TEXAS 75201

TELEPHONE: (800) 992-6209

FACSIMILE: (214) 999-9348 OR (214) 999-9323

(IF TENDERING BY FACSIMILE, PLEASE TRANSMIT BOTH THE FRONT AND BACK OF
THE LETTER OF TRANSMITTAL AND THE TAX CERTIFICATE PAGE.)

BEFORE RETURNING THIS LETTER OF TRANSMITTAL, PLEASE REFER TO THE
ACCOMPANYING INSTRUCTIONS.

<PAGE>

TAX CERTIFICATIONS

(i) The TIN printed (or corrected) on the front page of the Letter of
Transmittal is the correct TIN of the Unitholder, or if this box / / is
checked, the Unitholder has applied for a TIN. If the Unitholder has applied
for a TIN, a TIN has not been issued to the Unitholder, and either: (a) the
Unitholder has mailed or delivered an application to receive a TIN to the
appropriate IRS Center or Social Security Administration Office, or (b) the
Unitholder intends to mail or deliver an application in the near future (it
being understood that if the Unitholder does not provide a TIN to the
Purchaser 31% of all reportable payments made to the Unitholder will be
withheld until a TIN is provided to the Purchaser); and

(ii) Unless this box / / is checked, the Unitholder is not subject to
Backup Withholding either because the Unitholder: (a) is exempt from Backup
Withholding, (b) has not been notified by the IRS that the Unitholder is
subject to backup withholding as a result of a failure to report all interest
or dividends, or (c) has been notified by the IRS that such Unitholder is no
longer subject to Backup Withholding.

Note: Place an "X" in the box in (ii) if you are unable to certify that
the Unitholder is not subject to Backup Withholding.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
BOX B
FIRPTA AFFIDAVIT
(SEE INSTRUCTION 4 - BOX B)
- -------------------------------------------------------------------------------
Under Section 1445(e)(5) of the Internal Revenue Code and Treas. Reg.
1.1445-11T(d), a transferee must withhold tax equal to 10% of the amount
realized with respect to certain transfers of an interest in a partnership if
50% or more of the value of its gross assets consists of U.S. real property
interests and 90% or more of the value of its gross assets consists of U.S.
real property interests plus cash equivalents, and the holder of the
partnership interest is a foreign person. To inform the Purchaser that no
withholding is required with respect to the Unitholder's interest in the
Partnership, the person signing this Letter of Transmittal hereby certifies
the following under penalties of perjury:

(i) Unless this box / / is checked, the Unitholder, if an individual,
is a U.S. citizen or a resident alien for purposes of U.S. income taxation,
and if other than an individual, is not a foreign corporation, foreign
partnership, foreign estate or foreign trust (as those terms are defined in
the Internal Revenue Code and Income Tax Regulations); (ii) the Unitholder's
U.S. social security number (for individuals) or employer identification
number (for non-individuals) is correct as printed (or corrected) on the
front page of the Letter of Transmittal; and (iii) the Unitholder's home
address (for individuals), or office address (for non-individuals), is
correct as printed (or corrected) on the front of this Letter of Transmittal.
If a corporation, the jurisdiction of incorporation is _______________________.

The person signing this Letter of Transmittal understands that this
certification may be disclosed to the IRS by the Purchaser and that any false
statements contained herein could be punished by fine, imprisonment, or both.

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

(i) Is a nonresident alien individual or a foreign corporation,
partnership, estate or trust;

(ii) If an individual, has not been and plans not to be present in the
U.S. for a total of 183 days or more during the calendar year;

and

(iii) Neither engages, nor plans to engage, in a U.S. trade or business
that has effectively connected gains from transactions with a broker
or barter exchange.

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

PLEASE REFER TO ATTACHED INSTRUCTIONS ON BACK PAGE
<PAGE>

INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER

1. DELIVERY OF THE LETTER OF TRANSMITTAL. For convenience in responding to
the Offer, a pre-addressed, postage-paid envelope has been enclosed with
the Offer to Purchase. HOWEVER, TO ENSURE RECEIPT OF THE LETTER OF
TRANSMITTAL, IT IS SUGGESTED THAT YOU USE OVERNIGHT COURIER DELIVERY OR, IF
THE LETTER OF TRANSMITTAL IS TO BE DELIVERED BY UNITED STATES MAIL, THAT
YOU USE CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED.

To be effective, a duly completed and signed Letter of Transmittal (or
facsimile thereof) must be received by the Depositary at the address (or
facsimile number) set forth below before the Expiration Date, Midnight,
Eastern Time on March 17, 1998, unless extended. Unless otherwise
indicated in the signature box, all Units owned by a Unitholder shall be
deemed to have been tendered pursuant to the Offer.

THE HERMAN GROUP, INC.

BY HAND, MAIL OR OVERNIGHT 2121 San Jacinto Street
DELIVERY 26th Floor
Dallas, Texas 75201

BY FACSIMILE: (214) 999-9348 or (214) 999-9323

FOR ADDITIONAL INFORMATION CALL: (800) 992-6209

THE METHOD OF DELIVERY OF THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED
DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING UNITHOLDER AND
DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY.

2. SIGNATURE REQUIREMENTS.

Individual and Joint Owners. After carefully reading and completing the
Letter of Transmittal, in order to tender Units, Unitholder(s) must sign at
the "X" in the SIGNATURE BOX of the Letter of Transmittal. The
signature(s) must correspond exactly with the name printed (or corrected)
on the front of the Letter of Transmittal without any change whatsoever.
If any Units are registered in the names of two or more joint holders, all
such holders must sign the Letter of Transmittal.

If the Letter of Transmittal is signed by the registered holder of the
Units and payment is to be made directly to that holder, then no
notarization or signature guarantee is required on the Letter of
Transmittal. Similarly, if Units are held in an account of a member firm
of a registered national securities exchange, a member firm of the National
Association of Securities Dealers, Inc. or a commercial bank, savings bank,
credit union, savings and loan association or trust company having an
office, branch or agency in the United States (each an "Eligible
Institution") no notarization or signature guarantee is required. For
Units held in IRA Accounts, the beneficial owner should sign and no
notarization or signature guarantee is required. HOWEVER, IN ALL OTHER
CASES, ALL SIGNATURES ON THE LETTER OF TRANSMITTAL MUST EITHER BE NOTARIZED
OR GUARANTEED BY AN ELIGIBLE INSTITUTION.

TRUSTEES, CORPORATIONS AND FIDUCIARIES. Trustees, executors,
administrators, guardians, attorneys-in-fact, officers of a corporation,
authorized partner of a partnership or other persons acting in a fiduciary
or representative capacity must sign at the "X" in the SIGNATURE BOX and
have their signatures notarized OR signature guaranteed by an Eligible
Institution, by completing the Notarization or Signature Guarantee set
forth in the SIGNATURE BOX of the Letter of Transmittal and must submit
proper evidence satisfactory to the Purchaser of their authority to so act.
(See Instruction 3 herein.)

3. DOCUMENTATION REQUIREMENTS. In addition to information required to be
completed on the Letter of Transmittal, additional documentation may be
required by the Purchaser under certain circumstances including, BUT NOT
LIMITED TO THOSE LISTED BELOW. Questions on documentation should be
directed to The Herman Group, Inc. at (800) 992-6209.

DECEASED OWNER (JOINT TENANT) - Certified Copy of Death Certificate

DECEASED OWNER (OTHERS) - Certified Copy of Death Certificate.
(See also Executor/Administrator/
Guardian below.)

EXECUTOR/ADMINISTRATOR/GUARDIAN - (i) Certified copies of court
Appointment Documents for
Executor or Administrator
dated within 60 days;

and

(ii) a copy of applicable provisions
of the Will (Title Page,
Executor(s)' powers, asset
distribution); OR

(iii) Certified copy of Estate
distribution documents.

ATTORNEY-IN-FACT - Current Power of Attorney.

CORPORATIONS/PARTNERSHIPS - Certified copy of Corporate
Resolution(s), (with raised corporate
seal), or other evidence of authority
to act. Partnerships should furnish
copy of Partnership Agreement.

TRUST/PENSION PLANS - Copy of cover page of the Trust or
Pension Plan, along with copy of the
section(s) setting forth names and
powers of Trustee(s) and any amendments
to such sections or appointment of
Successor Trustee(s).

ALL SIGNATURES MUST BE NOTARIZED OR SIGNATURE GUARANTEED.

4. TAX CERTIFICATIONS. Unitholders tendering Units to the Purchaser pursuant
to the Offer must furnish the Purchaser with his, her or its Taxpayer
Identification Number ("TIN") and certify under penalties of perjury, the
representations in Boxes A, B, and, if applicable, Box C. By signing in
the Signature Box the Unitholder(s) certify that the TIN as printed (or
corrected) on the front of the Letter of Transmittal is correct.

U.S. PERSONS. A Unitholder who or which is a United States citizen OR a
resident alien individual, a domestic corporation, a domestic partnership,
a domestic trust or a domestic estate (collectively, "U.S. Persons") as
those terms are defined in the Internal Revenue Code and Income Tax
Regulations, should follow the instructions below with respect to
certifying Boxes A and B (on the reverse side of the Letter of
Transmittal).

BOX A - SUBSTITUTE FORM W-9. Part (i), Taxpayer Identification Number -
The person signing this Letter of Transmittal must provide to the Purchaser
the Unitholder's correct TIN and certify its correctness as printed (or
corrected) on the front of the Letter of Transmittal and the
representations made in Boxes A, B and (if applicable) Box C are correct
under penalties of perjury. If a correct TIN is not provided, penalties
may be imposed by the Internal Revenue Service ("IRS"), in addition to the
Unitholders's being subject to Backup Withholding. Part (ii), Backup
Withholding - In order to avoid 31% federal income tax Backup Withholding,
the person signing this Letter of Transmittal must certify, under penalties
of perjury, that such Unitholder is not subject to backup Withholding.
Certain Unitholders (including, among others, all Corporations and certain
exempt non-profit organizations) are not subject to Backup Withholding.
Backup Withholding is not an additional tax. If withholding results in an
overpayment of taxes, a refund may be obtained from the IRS. DO NOT CHECK
THE BOX IN BOX A, PART (II), UNLESS YOU HAVE BEEN NOTIFIED BY THE IRS THAT
YOU ARE SUBJECT TO BACKUP WITHHOLDING.

WHEN DETERMINING THE TIN TO BE FURNISHED, PLEASE REFER TO THE FOLLOWING
NOTE AS A GUIDELINE:

INDIVIDUAL ACCOUNTS should reflect their own TIN. JOINT ACCOUNTS should
reflect the TIN of the person whose name appears first. TRUST ACCOUNTS
should reflect the TIN assigned to the Trust. CUSTODIAL ACCOUNTS FOR THE
BENEFIT OF MINORS should reflect the TIN of the minor. CORPORATIONS OR
OTHER BUSINESS ENTITIES should reflect the TIN assigned to that entity.

BOX B - FIRPTA AFFIDAVIT - Section 1445 of the Internal Revenue Code
requires that Unitholders transferring interests in partnerships with real
estate assets meeting certain criteria, certify under penalty of perjury,
the representations made in Box B, or be subject to withholding of tax
equal to 10% of the Purchase Price for Units purchased. Tax withheld under
Section 1445 of the Internal Revenue Code is not an additional tax. If
withholding results in an overpayment of tax, a refund may be obtained from
the IRS. Note(s): Box B, Part (i) Should be checked ONLY if the Unitholder
is NOT a U.S. Person, as described therein. Corporations should insert the
jurisdiction of incorporation in the blank in Part (iii).

BOX C - FOREIGN PERSONS - In order for a Unitholder, who is a Foreign
Person (i.e., not a U.S. Person as defined above) to qualify as exempt from
31% Backup Withholding, the person signing this Letter of Transmittal must
certify, under penalties of perjury, the statement in Box C of this Letter
of Transmittal attesting to the Foreign Unitholder's status by checking the
box preceding such statement. UNLESS THE BOX IS CHECKED, SUCH FOREIGN
UNITHOLDER WILL BE SUBJECT TO 31% WITHHOLDING OF TAX UNDER SECTION 1445 OF
THE CODE.

5. VALIDITY OF LETTER OF TRANSMITTAL. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance of a Letter of
Transmittal will be determined by the Purchaser and such determination will
be final and binding. The Letter of Transmittal will not be valid until
any irregularities have been cured or waived. Neither the Purchaser nor
The Herman Group, Inc. is under any duty to give notification of defects in
a Letter of Transmittal and neither will incur liability for failure to
give such notification.

<PAGE>

PRESIDIO RPS ACQUISITION CORP.
411 WEST PUTNAM AVENUE
GREENWICH, CT 06830

February 18, 1998

Dear Limited Partner of
Resources Pension Shares 5, L.P.:

Enclosed please find a copy of an Offer to Purchase (the "Offer to
Purchase") being made by Presidio RPS Acquisition Corp., an affiliate of the
general partners of Resources Pension Shares 5, L.P. (the "Partnership"), to
purchase your limited partnership units in the Partnership for $6.00 per
unit, net to you in cash. The Offer is scheduled to expire March 17, 1998
and is limited to 2,000,000 units, representing approximately 35% of the
total number of units outstanding.

The Offer will provide Unitholders with an immediate opportunity to
liquidate their investment in the Partnership for cash. The $6.00 purchase
price is approximately 14% higher than the $5.25 weighted average net selling
price for Units recently reported for the limited secondary market, without
giving effect to commissions and other transactional costs payable by sellers
of Units. ASSUMING COMMISSIONS AND TRANSACTIONAL COSTS OF 9%, $4.78 OF THE
$5.25 WEIGHTED AVERAGE SELLING PRICE WOULD BE RECEIVED BY SELLING UNITHOLDERS
IN THE SECONDARY MARKET. Unitholders who tender their Units will not be
obligated to pay any commissions or Partnership transfer fees. The $6.00
Purchase Price is also 20% higher than a recent third party tender offer for
Units at $5 per Unit.

We urge you to carefully review the enclosed Offer to Purchase and the
accompanying Letter of Transmittal. To tender your units, please execute the
enclosed Letter of Transmittal and return it to the undersigned in the manner
and to the address indicated in the Instructions to the Letter of Transmittal.

If you have any questions with respect to the Offer, please call The
Herman Group, Inc., our information agent, toll free at (800) 992-6209.

PRESIDIO RPS ACQUISITION CORP.