ARVIDA JMB PARTNERS L P, 10-Q, 1995-08-14

ARVIDA JMB PARTNERS L P
10-Q, 1995-08-14
LAND SUBDIVIDERS & DEVELOPERS (NO CEMETERIES)

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SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM 10-Q

Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934

For the quarter ended June 30, 1995 Commission file #0-16976

ARVIDA/JMB PARTNERS, L.P.
(Exact name of registrant as specified in its charter)

Delaware 36-3507015
(State of organization) (IRS Employer Identification No.)

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

Registrant's telephone number, including area code 312/440-4800

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

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION

Item 1. Financial Statements. . . . . . . . . . . . . . . . . . . 3

Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations. . . . . . . . . . . . . . . . . . . . . . . . 26

PART II OTHER INFORMATION

Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . 33

Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . 36
<TABLE>
PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED BALANCE SHEETS

JUNE 30, 1995 AND DECEMBER 31, 1994

(UNAUDITED)

ASSETS
------

<CAPTION>
JUNE 30, DECEMBER 31,
1995 1994
------------ -----------
<S> <C> <C>
Cash and cash equivalents (note 3) . . . . . . . . . . . . . . . . . . . . . . . . $ 6,209,415 22,024,390
Restricted cash (note 3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,921,386 14,232,540
Trade and other accounts receivable (net of allowance for doubtful
accounts of $210,943 at June 30, 1995 and $229,542 at
December 31, 1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,053,919 18,209,957
Mortgages receivable, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 998,362 1,094,223
Real estate inventories (note 2) . . . . . . . . . . . . . . . . . . . . . . . . . 219,170,634 207,874,438
Property and equipment, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . 69,875,613 69,114,559
Investments in and advances to joint ventures, net . . . . . . . . . . . . . . . . 23,578,657 23,178,951
Equity memberships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,704,403 10,536,864
Amounts due from affiliates (note 6) . . . . . . . . . . . . . . . . . . . . . . . -- 524,556
Prepaid expenses and other assets. . . . . . . . . . . . . . . . . . . . . . . . . 9,521,858 9,581,234
------------ ------------

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $367,034,247 376,371,712
============ ============
ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED BALANCE SHEETS (CONTINUED)

(UNAUDITED)

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

JUNE 30, DECEMBER 31,
1995 1994
------------ -----------
Liabilities:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 21,082,370 24,142,890
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,745,289 27,082,766
Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . . 17,556,280 13,418,777
Amounts due to affiliates (note 6) . . . . . . . . . . . . . . . . . . . . . . . 203,956 --
Notes and mortgages payable, net (note 4). . . . . . . . . . . . . . . . . . . . 86,630,743 115,147,525
------------ ------------
Commitments and contingencies (notes 1, 4, 5, 6, 7 and 8)

Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . 151,218,638 179,791,958
------------ ------------

Partners' capital accounts:
General Partner and Associate Limited Partners:
Capital contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000 20,000
Cumulative net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,826,226 34,328,454
Cumulative cash distributions. . . . . . . . . . . . . . . . . . . . . . . . . (33,912,035) (33,609,346)
------------ ------------
934,191 739,108
------------ ------------
Limited Partners:
Capital contributions, net of offering costs . . . . . . . . . . . . . . . . . 364,841,815 364,841,815
Cumulative net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,865,625) (32,354,861)
Cumulative cash distributions. . . . . . . . . . . . . . . . . . . . . . . . . (142,094,772) (136,646,308)
------------ ------------
214,881,418 195,840,646
------------ ------------
Total partners' capital accounts . . . . . . . . . . . . . . . . . . . . 215,815,609 196,579,754
------------ ------------

Total liabilities and partners' capital. . . . . . . . . . . . . . . . . $367,034,247 376,371,712
============ ============
<FN>
The accompanying notes are an integral part
of these consolidated financial statements.
</TABLE>
<TABLE>
ARVIDA/JMB PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS

THREE AND SIX MONTHS ENDED JUNE 30, 1995 AND 1994

(UNAUDITED)
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
-------------------------- --------------------------
1995 1994 1995 1994
----------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
Revenues:
Housing. . . . . . . . . . . . . . . . . . . . . . . . $55,811,663 59,421,466 100,420,751 91,328,545
Homesites. . . . . . . . . . . . . . . . . . . . . . . 8,300,198 11,799,494 12,496,614 23,896,228
Land and property. . . . . . . . . . . . . . . . . . . 13,153,432 2,382,739 25,222,673 4,821,137
Operating properties . . . . . . . . . . . . . . . . . 6,801,299 6,202,194 15,206,484 13,714,669
Brokerage and other operations . . . . . . . . . . . . 7,949,959 9,472,056 14,734,076 16,258,491
----------- ---------- ----------- -----------
Total revenues . . . . . . . . . . . . . . . . . 92,016,551 89,277,949 168,080,598 150,019,070
----------- ---------- ----------- -----------
Cost of revenues:
Housing. . . . . . . . . . . . . . . . . . . . . . . . 47,466,697 46,000,439 83,106,773 70,987,382
Homesites. . . . . . . . . . . . . . . . . . . . . . . 5,459,845 8,084,899 8,122,393 14,222,955
Land and property. . . . . . . . . . . . . . . . . . . 6,785,455 675,972 10,952,116 2,246,365
Operating properties . . . . . . . . . . . . . . . . . 6,810,992 6,581,978 14,114,936 13,222,317
Brokerage and other operations . . . . . . . . . . . . 6,807,364 7,513,632 13,726,164 13,461,695
----------- ---------- ----------- -----------
Total cost of revenues . . . . . . . . . . . . . 73,330,353 68,856,920 130,022,382 114,140,714
----------- ---------- ----------- -----------
Gross operating profit . . . . . . . . . . . . . . . . . 18,686,198 20,421,029 38,058,216 35,878,356
Selling, general and administrative
expenses . . . . . . . . . . . . . . . . . . . . . . . (6,987,196) (4,287,165) (12,448,610) (9,251,973)
----------- ---------- ----------- -----------
Net operating income . . . . . . . . . . . . . . 11,699,002 16,133,864 25,609,606 26,626,383

ARVIDA/JMB PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)

THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
-------------------------- --------------------------
1995 1994 1995 1994
----------- ---------- ----------- ----------

Interest income. . . . . . . . . . . . . . . . . . . . . 289,419 237,850 611,662 344,995
Equity in earnings (losses) of
unconsolidated ventures. . . . . . . . . . . . . . . . (34,877) (75,541) 1,079,185 (22,350)
Interest and real estate taxes, net. . . . . . . . . . . (1,146,398) (2,637,390) (2,313,445) (4,799,246)
----------- ---------- ----------- ----------
Net income . . . . . . . . . . . . . . . . . . . $10,807,146 13,658,783 24,987,008 22,149,782
=========== ========== =========== ==========

Net income per Limited
Partnership Interest . . . . . . . . . . . . . $ 26.49 33.47 60.62 53.99
=========== ========== =========== ==========

Cash distributions per Limited
Partnership Interest . . . . . . . . . . . . . $ -- -- 13.49 6.35
=========== ========== =========== ==========

<FN>
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
<TABLE>
ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 1995 AND 1994

(UNAUDITED)

<CAPTION>
1995 1994
------------ -----------
<S> <C> <C>
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 24,987,008 22,149,782
Charges (credits) to net income not requiring (providing) cash:
Depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,867,929 2,851,410
Equity in (earnings) losses of unconsolidated ventures . . . . . . . . . . . . . . . (1,079,185) 22,350
Provision for doubtful accounts. . . . . . . . . . . . . . . . . . . . . . . . . . . (18,599) --
Loss (gain) on disposition of property and equipment . . . . . . . . . . . . . . . . (3,546,130) 33,111
Changes in:
Restricted cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (688,846) (3,362,676)
Trade and other accounts receivable. . . . . . . . . . . . . . . . . . . . . . . . . 5,174,637 (12,097,696)
Real estate inventories:
Additions to real estate inventories . . . . . . . . . . . . . . . . . . . . . . . (106,304,017) (90,542,051)
Cost of sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,181,282 87,456,702
Capitalized interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,270,301) (3,792,359)
Capitalized real estate taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . (2,185,688) (1,471,458)
Equity memberships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 832,461 1,518,071
Amounts due from affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 524,556 42,684
Prepaid expenses and other assets. . . . . . . . . . . . . . . . . . . . . . . . . . (254,512) (104,880)
Accounts payable, accrued expenses and other liabilities . . . . . . . . . . . . . . 1,020,039 5,390,051
Amounts due to affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203,956 --
Deposits and unearned income . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,337,477) 8,049,018
------------ -----------

Net cash provided by operating activities. . . . . . . . . . . . . . . . . . 18,107,113 16,142,059
------------ -----------
ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

1995 1994
------------ -----------
Cash flows from investing activities:
Mortgages receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95,861 1,126,588
Acquisitions of property and equipment . . . . . . . . . . . . . . . . . . . . . . . (6,768,965) (3,291,320)
Proceeds from sales and disposals of property and equipment. . . . . . . . . . . . . 7,000,000 2,528
Joint venture distributions, net . . . . . . . . . . . . . . . . . . . . . . . . . . 69,624 375,353
Payments from (advances to) joint ventures . . . . . . . . . . . . . . . . . . . . . (50,673) 185,357
------------ -----------
Net cash provided by (used in) investing activities. . . . . . . . . . . . . 345,847 (1,601,494)
------------ -----------
Cash flows from financing activities:
Proceeds from notes and mortgages payable. . . . . . . . . . . . . . . . . . . . . . 30,811,115 9,183,087
Payments of notes and mortgages payable. . . . . . . . . . . . . . . . . . . . . . . (59,327,897) (26,276,823)
Distributions to General Partner and Associate Limited Partners. . . . . . . . . . . (302,689) (142,523)
Distributions to Limited Partners. . . . . . . . . . . . . . . . . . . . . . . . . . (5,448,464) (2,565,433)
------------ -----------
Net cash used in financing activities. . . . . . . . . . . . . . . . . . . . (34,267,935) (19,801,692)
------------ -----------
Decrease in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . (15,814,975) (5,261,127)
Cash and cash equivalents, beginning of year . . . . . . . . . . . . . . . . . . . . . 22,024,390 18,906,679
------------ -----------
Cash and cash equivalents, end of period . . . . . . . . . . . . . . . . . . . . . . . $ 6,209,415 13,645,552
============ ===========
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest, net of amounts capitalized. . . . . . . . $ 9,690 2,918,021
============ ===========
Non-cash investing and financing activities:
Distribution of land from joint venture . . . . . . . . . . . . . . . . . . . . . $ 717,472 --
============ ===========

<FN>
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 1995 AND 1994

(UNAUDITED)

Readers of this quarterly report should refer to the Partnership's
audited financial statements for the fiscal year ended December 31, 1994,
which are included in the Partnership's 1994 Annual Report, as certain
footnote disclosures which would substantially duplicate those contained in
such audited financial statements have been omitted from this report.

(1) BASIS OF ACCOUNTING

Principles of Consolidation

The consolidated financial statements include the accounts of
Arvida/JMB Partners, L.P. (the "Partnership") and its consolidated ventures
(note 5). All material intercompany balances and transactions have been
eliminated in consolidation.

Recognition of Profit from Sales of Real Estate

For sales of real estate, profit is recognized in full when the
collectibility of the sales price is reasonably assured and the earnings
process is virtually complete. When the sale does not meet the
requirements for recognition of income, profit is deferred until such
requirements are met. For sales of residential units, profit is recognized
at the time of closing or, if certain criteria are met, on the percentage
of completion method.

Real Estate Inventories and Cost of Real Estate Revenues

Real estate inventories are carried at cost, including capitalized
interest and property taxes, but not in excess of the net realizable value
determined by the evaluation of individual projects. Management's
evaluation of net realizable value is based on each project's estimated
selling price in the ordinary course of business less estimated costs of
completion, holding and disposal. These estimates are reviewed
periodically and compared to each project's recorded book value.
Adjustments to book value, as they become necessary, are reported in the
period in which they become known. The total cost of land, land
development and common costs are apportioned among the projects on the
relative sales value method. Costs pertaining to the Partnership's
housing, homesites and land and property revenues reflect the cost of the
acquired assets as well as development costs, construction costs,
capitalized interest, capitalized real estate taxes and capitalized
overheads. Certain marketing costs relating to housing projects, including
exhibits and displays, and certain planning and other pre-development
activities, excluding normal period expenses, are capitalized and charged
to housing cost of revenues as related units are closed. A warranty
reserve is provided as residential units are closed. This reserve is
reduced by the cost of subsequent work performed.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

Capitalized Interest and Real Estate Taxes

Interest and real estate taxes incurred are capitalized to qualifying
assets, principally real estate inventories. Such capitalized interest and
real estate taxes are charged to cost of revenues as sales of real estate
inventories are recognized. Interest, including the amortization of loan
fees, of approximately $4,388,400 and $5,542,900 was incurred for the six
months ended June 30, 1995 and 1994, respectively, of which approximately
$4,270,300 and $3,792,300 was capitalized, respectively. Interest
payments, including amounts capitalized, of approximately $4,280,000 and
$6,710,400 were made during the six months ended June 30, 1995 and 1994,
respectively. Interest, including the amortization of loan fees, of
approximately $2,015,600 and $2,707,300 was incurred for the three months
ended June 30, 1995 and 1994, respectively, of which approximately
$1,905,900 and $1,822,100 was capitalized, respectively. Interest payments
of approximately $1,951,300 and $3,289,000 were made during the three
months ended June 30, 1995 and 1994, respectively.

Real estate taxes of approximately $4,381,000 and $4,520,100 were
incurred for the six months ended June 30, 1995 and 1994, respectively, of
which approximately $2,185,700 and $1,471,500 were capitalized,
respectively. Real estate tax payments of approximately $375,000 and
$305,200 were made during the six months ended June 30, 1995 and 1994,
respectively. Real estate taxes of approximately $2,147,200 and $2,297,800
were incurred for the three months ended June 30, 1995 and 1994,
respectively, of which approximately $1,110,500 and $545,600 was
capitalized, respectively. Real estate tax payments of approximately
$278,300 and $225,500 were made during the three months ended June 30, 1995
and 1994, respectively. The preceding analysis of real estate taxes does
not include real estate taxes incurred or paid with respect to the Partner-
ship's club facilities and operating properties as these taxes are included
in cost of revenues for operating properties.

Property and Equipment and Other Assets

Property and equipment are carried at cost less accumulated
depreciation and are depreciated on the straight-line method over the
estimated useful lives of the assets, which range from two to 40 years.
Provisions for value impairment are recorded with respect to such assets
whenever the estimated future cash flows from operations and projected
sales proceeds are less than the net carrying value. Expenditures for
maintenance and repairs are charged to expense as incurred. Costs of major
renewals and improvements which extend useful lives are capitalized. Other
assets are amortized on the straight-line method over the useful lives of
the assets which range from one to five years.

Depreciation expense of approximately $2,554,000 and $2,475,100 was
incurred for the six months ended June 30, 1995 and 1994, respectively.
Amortization of other assets, excluding loan fees, of approximately
$110,000 and $107,500 was incurred for the six months ended June 30, 1995
and 1994. Amortization of loan fees, which is included in interest
expense, of approximately $203,900 and $268,800 was incurred for the six
months ended June 30, 1995 and 1994, respectively. Depreciation expense of
approximately $1,288,300 and $1,231,000 was incurred for the three months
ended June 30, 1995 and 1994, respectively. Amortization expense of other
assets excluding loan fees, of approximately $53,500 and $52,500 was
incurred for the three months ended June 30, 1995 and 1994, respectively.
Amortization of loan fees, which is included in interest expense, of
approximately $74,400 and $136,900 was incurred for the three months ended
June 30, 1995 and 1994, respectively.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

Investments in and Advances to Joint Ventures, Net

In general, the equity method of accounting has been applied in the
accompanying consolidated financial statements with respect to those
investments for which the Partnership does not have majority control and
where the Partnership's ownership interest is 50% or less (note 5). The
cost method of accounting has been applied in the accompanying consolidated
financial statements with respect to the Coto de Caza joint venture. The
cost method of accounting is used when a limited partner has virtually no
influence over the venture operations and financial policies. Under the
cost method, income is generally recorded only to the extent of
distributions received.

Investments in the remaining joint ventures are carried at the
Partnership's proportionate share of the ventures' assets (not in excess of
their net realizable value determined by evaluation of individual
projects), net of their related liabilities and adjusted for any basis
differences. Basis differences result from the purchase of interests at
values which differ from the recorded cost of the Partnership's
proportionate share of the joint ventures' net assets.

The Partnership periodically advances funds to its joint ventures in
which it holds ownership interests when deemed necessary and economically
justifiable. Such advances are generally interest bearing and are
repayable to the Partnership from amounts earned through joint venture
operations.

Equity Memberships

The amenities within certain of the Partnership's Boca Raton and
Jacksonville, Florida Communities, as well as its Community near Highlands,
North Carolina are conveyed to the respective homeowners through the sale
of equity memberships. The amounts recorded as equity memberships in the
accompanying Consolidated Balance Sheets represent the accumulation of
costs incurred in constructing clubhouses, golf courses, tennis courts and
various other related assets less amounts allocated to memberships sold not
in excess of their net realizable value determined by evaluations of
individual amenities. Equity membership revenues and related cost of
revenues are included in land and property in the accompanying Consolidated
Statements of Operations.

Partnership Records

The Partnership's records are maintained on the accrual basis of
accounting as adjusted for Federal income tax reporting purposes. The
accompanying consolidated financial statements have been prepared from such
records after making appropriate adjustments where applicable to reflect
the Partnership's accounts in accordance with generally accepted accounting
principles ("GAAP") and to consolidate the accounts of the ventures as
described above. The net effect of these items is summarized as follows
for the six months ended June 30:
ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

1995 1994
----------------------- ------------------------
GAAP BASIS TAX BASIS GAAP BASIS TAX BASIS
---------- --------- ---------- ---------

Net income . . . . . . $24,987,008 18,745,336 22,149,782 20,520,511
Net income per
Limited
Partnership
Interest. . . . . . . $ 60.62 44.66 53.99 50.02
Cash distribu-
tions per
Limited
Partnership
Interest. . . . . . . $ 13.49 13.49 6.35 6.35
=========== ========== ========= =========

Reference is made to note 9 for further discussion of the allocation
of profits and losses to the General Partner, Associate Limited Partners
and Limited Partners.

In February 1995, the Partnership made a distribution for 1994 of
$5,421,680 to its Limited Partners ($13.42 per Interest) and $301,201 to
the General Partner and Associate Limited Partners, collectively. In
addition, during the first quarter of 1995, the Partnership remitted each
Limited Partner's share of a North Carolina non-resident withholding tax on
behalf of each of the Limited Partners. Such payment, which totalled
$26,784 ($.07 per Interest), was deemed a distribution to the Limited
Partners. A distribution of $1,488 was also paid at that time to the
General Partner and Associate Limited Partners, collectively, a portion of
which was also remitted to the state tax authorities on their behalf.

The net income per Limited Partnership Interest is based upon the
average number of Limited Partnership Interests outstanding during each
period.

Income Taxes

No provision for Federal or state income taxes has been made as the
liability for such taxes is that of the partners rather than the
Partnership. However, in certain instances, the Partnership has been
required under applicable state law to remit directly to the state tax
authorities amounts representing withholding on applicable taxable income
allocated to partners. In such regard, the cash distribution per Limited
Partnership Interest made during the six months ended June 30, 1995
includes $.07 which represents each Limited Partner's share of a North
Carolina non-resident withholding tax which was paid directly to the state
tax authorities on behalf of the Limited Partners.

(2) INVESTMENT PROPERTIES

The Partnership's assets consist principally of interests in land
which is in the process of being developed into master-planned residential
communities (the "Communities") and, to a lesser extent, commercial
properties; mortgage notes and accounts receivable; management and other
service contracts; construction, brokerage and other support activities;
real estate assets held for investment; club and recreational facilities;
and a cable television business serving its Weston Community.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

The Partnership's Communities are in various stages of development,
with estimated remaining build-outs ranging from one to ten years. The
Partnership's condominium project on Longboat Key, Florida known as
Arvida's Grand Bay, is in its early stage of development. The Weston
Community, located in Broward County, Florida is the Partnership's largest
Community and is in its mid stage of development. Also in their mid stages
of development are the River Hills Country Club in Tampa, Florida;
Jacksonville Golf and Country Club in Jacksonville, Florida; the Water's
Edge Community in Atlanta, Georgia and The Cullasaja Club, near Highlands,
North Carolina. The Partnership's remaining Communities known as Sawgrass
Country Club, in Jacksonville, Florida and Dockside in Atlanta, Georgia are
in their final stages of development with anticipated close-outs in 1996.
In addition, the Broken Sound Community, located in Boca Raton, Florida, is
nearing completion with an anticipated close-out in 1995. Future revenues
will be impacted to the extent that there are lower levels of inventories
available for sale as these Communities approach or undertake their final
phases.

For a discussion of a lawsuit initiated by the General Partner, on
behalf of the Partnership, against The Walt Disney Company ("Disney"),
which arose out of the Partnership's acquisition of substantially all of
the real estate and other assets of Arvida Corporation, a subsidiary of
Disney, in September 1987, reference is made to Note 2 of Notes to
Consolidated Financial Statements of the Partnership's report for December
31, 1994 on Form 10-K (File No. 0-16976) filed on March 27, 1995.

(3) CASH, CASH EQUIVALENTS AND RESTRICTED CASH

At June 30, 1995 and December 31, 1994, cash and cash equivalents
primarily consisted of U.S. Government obligations with original maturities
of three months or less, money market demand accounts and repurchase
agreements, the costs of which approximate market value. Cash and cash
equivalents include treasury bills being held to maturity with original
maturity dates of three months or less of approximately $1,746,000 and
$1,777,000 at June 30, 1995 and December 31, 1994, respectively. The
decrease in cash and cash equivalents at June 30, 1995 as compared to
December 31, 1994 is due primarily to debt service payments as well as
distributions to partners made in February 1995. Included in restricted
cash are amounts restricted under various escrow agreements. Credit risk
associated with cash, cash equivalents and restricted cash is considered
low due to the quality of the financial institutions in which these assets
are held.

(4) NOTES AND MORTGAGES PAYABLE

At June 30, 1995, the Partnership's credit facility consists of a term
loan in the original amount of $85,252,520, a revolving line of credit
facility up to $20 million, an income property term loan in the original
amount of $18,233,326 and a $15 million letter of credit facility. The
term loan, the revolving line of credit and the letter of credit facility
are secured by recorded mortgages on all otherwise unencumbered real
property assets of the Partnership, as well an assignment of all mortgages
receivable, equity memberships, certain joint venture interests or joint
venture proceeds and cash balances (with the exception of deposits held in
escrow). The income property term loan is secured by the recorded first
mortgage on a mixed-use center in Boca Raton, Florida. An office building,
also located in Boca Raton, which served as additional collateral for the
income property loan, was sold in May 1995. All of the notes under the
facility are cross-collateralized and cross-defaulted. At June 30, 1995,
the term loan, the revolving line of credit and the income property term

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

loan bear interest based, at the Partnership's option, on one of the
lenders' prime rate plus 1.25% per annum or the relevant London Inter-Bank
Offering Rate (LIBOR) plus 2.50% per annum. For the six month period ended
June 30, 1995, the effective interest rate for the combined term loan,
income property term loan and revolving line of credit facility was
approximately 9.1% per annum.

Under the term loan agreement, the Partnership made scheduled
principal payments of $10 million in March 1994 and February 1995 and a $5
million principal payment in July 1995. In addition, the term loan
agreement provides for additional principal repayments based upon a
specified percentage of available cash flow and upon the sale of certain
assets. During the six months ended June 30, 1995, the Partnership made
such additional term loan payments totalling approximately $20.0 million.
Principal repayments of, $10 million and $5 million on the term loan are
due in February 1996 and July 1996, respectively. The remaining balance
outstanding is due in July 1997. Under the income property term loan,
principal payments of $0.1 million are required to be paid monthly until
March 1996 when the remaining outstanding principal balance will be due.
The revolving line of credit matures in December 1995. The letter of
credit facility had been scheduled to mature in July 1995, but has been
extended for one year and will mature in July 1996. At June 30, 1995, all
of the term loan proceeds had been borrowed with a remaining balance of
$43,461,864. The balances outstanding on the revolving line of credit
facility, the income property term loan and the letter of credit facility
at June 30, 1995 are $10,000,000, $13,366,746 and $9,773,800, respectively.

The Partnership closed on the sale of an office building located in
downtown Boca Raton, Florida known as Mizner Place during May, 1995. In
accordance with the terms of the Partnership credit facility, the net
proceeds from the sale of approximately $4.0 million were used to pay down
the income property term loan.

The credit agreement contains significant restrictions with respect to
the payment of distributions to partners, the maintenance of certain loan-
to-value ratios, the use of proceeds from the sale of the Partnership's
assets and advances to the Partnership's joint ventures.

Loan fees incurred in connection with the Partnership's credit
facility have been capitalized and are being amortized over the lives of
the loans included in the credit facility using the straight-line method,
which approximates the interest method.

Also included in notes and mortgages payable at June 30, 1995 is
approximately $6.8 million representing project specific financing for the
Partnership's retail property located in its Weston Community,
approximately $3.0 million of subordinated debt attributable to the
Cullasaja Joint Venture and a $1.5 million note executed in conjunction
with the Partnership's repurchase of a land parcel in Weston's Increment
III.

In addition to the above, the Partnership has a $28.9 million
revolving construction line of credit for three buildings and certain
amenities within the Partnership's condominium project on Longboat Key,
Florida know as Arvida's Grand Bay. This line of credit, currently, bears
interest at the lender's prime rate (9% at June 30, 1995) plus 1/2% per
annum and matures in January 1997. At June 30, 1995, approximately $4.4
million was outstanding under this note. The Partnership currently
anticipates that this amount will be repaid with the proceeds from the sale
of condominium units. The receipt of sales proceeds from units sold within

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

the first building prior to December 31, 1994 which closed during the six
months ended June 30, 1995 is the primary cause of the decrease in trade
and other accounts receivable at June 30, 1995 as compared to December 31,
1994.

Certain of the Partnership's property within the Cullasaja Community
was encumbered by a mortgage note which matured on March 1, 1994. The note
was collateralized by a first mortgage on certain real estate inventories
and 12.5% of the outstanding balance was guaranteed by the Partnership.
The Partnership was unable to obtain an extension of the loan, and
therefore, on June 29, 1994, purchased the note at par and paid the accrued
interest thereon and certain attorney and conveyance fees. The total
amount of such payment was approximately $5,278,000. The note and mortgage
were subsequently pledged as collateral to the Partnership's lender under
its credit facility.

(5) INVESTMENTS IN AND ADVANCES TO JOINT VENTURES

The Partnership has numerous investments in real estate joint ventures
with ownership interests ranging from 20% to 50%. Under certain
circumstances, either pursuant to the venture agreement or due to the
Partnership's obligations as a general partner, the Partnership may be
required to make cash advances or contributions to the ventures. During
the six months ended June 30, 1995, the Partnership advanced approximately
$227,400 to certain of the joint ventures in which it holds interests and
received reimbursements during the same period of approximately $176,400.
The total of such advances outstanding were approximately $4.2 and $4.1
million at June 30, 1995 and December 31, 1994, respectively, and are
included in Investments in and Advances to Joint Ventures in the
accompanying Consolidated Balance Sheets. These amounts primarily
represent outstanding advances made to the Coto de Caza Joint Venture in
previous years. As of August 4, 1995, approximately $27,100 of the
advances made to the joint ventures was received by the Partnership. In
addition, there are certain risks associated with the Partnership's
investments made through joint ventures, including the possibility that the
Partnership's joint venture partners in an investment might become unable
or unwilling to fulfill their financial obligations, or that such joint
venture partners may have economic or business interests or goals that are
inconsistent with those of the Partnership. During July 1995, the
Partnership was informed by its partner in the Coto de Caza Joint Venture
of such partner's intention to sell its interest in the joint venture.
Under the terms of the joint venture agreement, the Partnership has a right
of first offer with respect to such interest. The Partnership does not
believe that its partner has complied with the terms of the joint venture
agreement for the sale of its interest. The Partnership has informed its
partner of the Partnership's position and is considering its alternatives
in the event that its partner proceeds with a sale without addressing the
Partnership's concerns.

(6) TRANSACTIONS WITH AFFILIATES

The Partnership, subject to certain limitations, may engage affiliates
of the General Partner for property management, insurance and certain other
administrative services to be performed in connection with the
administration of the Partnership and its assets. The total of such costs
(consisting primarily of insurance commissions) for the six months ended
June 30, 1995 was approximately $282,100 all of which was paid as of June
30, 1995. The total of such costs for the six months ended June 30, 1994
was approximately $280,000. In addition, the General Partner and its
affiliates are entitled to reimbursements for salaries and salary-related

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

costs relating to the administration of the Partnership and the operation
of the Partnership's properties. Such costs were approximately $128,600
for the year ended December 31, 1994, all of which was paid as of June 30,
1995.

The Partnership receives reimbursements from or reimburses other
affiliates of the General Partner engaged in real estate activities for
certain general and administrative costs including, and without limitation,
salary and salary-related costs relating to work performed by employees of
the Partnership and certain out-of-pocket expenditures incurred on behalf
of such affiliates. For the six months ended June 30, 1995, the amount of
such costs incurred by the Partnership on behalf of these affiliates
totalled approximately $322,300. At June 30, 1995, approximately $214,200
was owed to the Partnership, of which approximately $98,600 was received as
of August 4, 1995. For the six month period ended June 30, 1994, the
Partnership was entitled to reimbursements of approximately $243,000.

The Partnership and Arvida/JMB Partners, L.P.-II (a publicly-held
limited partnership affiliated with the General Partner) each employ
project related and administrative personnel who perform services on behalf
of both partnerships. In addition, certain out-of-pocket expenditures
related to such services and other general and administrative costs are
incurred and charged to each partnership as appropriate. The Partnership
receives reimbursements from or reimburses Arvida/JMB Partners, L.P.-II for
such costs (including salary and salary-related costs). For the six month
periods ended June 30, 1995 and 1994, the Partnership was entitled to
receive approximately $576,200 and $626,800, respectively, from Arvida/JMB
Partners, L.P.-II. At June 30, 1995, approximately $124,300 was owed to
the Partnership, all of which was received as of August 4, 1995. In
addition, for the six month periods ended June 30, 1995 and 1994, the
Partnership was obligated to reimburse Arvida/JMB Partners, L.P.-II
approximately $97,300 and $270,300, respectively. At June 30, 1995,
approximately $58,900 was unpaid, all of which was paid as of August 4,
1995.

Arvida Company ("Arvida"), pursuant to an agreement with the
Partnership, provides development, construction, management and other
personnel and services to the Partnership for all of its projects and
operations. Pursuant to such agreement, the Partnership shall reimburse
Arvida for all of its out-of-pocket expenditures (including salary and
salary-related costs), subject to certain limitations. The total of such
costs for the six month periods ended June 30, 1995 and 1994 were
approximately $3,474,100 and $4,061,000, respectively. At June 30, 1995,
approximately $55,100 was unpaid, all of which was paid as of August 4,
1995.

The Partnership pays for certain general and administrative costs on
behalf of its equity clubs, homeowners associations and maintenance
associations. The Partnership receives reimbursements from these entities
for such costs. For the six month period ended June 30, 1995, the
Partnership was entitled to receive approximately $157,000 from these
entities. At June 30, 1995, approximately $46,500 was owed to the
Partnership. As of August 4, 1995, approximately $26,100 had been
received. For the six months ended June 30, 1994, the Partnership was
entitled to receive approximately $270,000 from these entities. In
addition, the Partnership owes its equity clubs for certain costs incurred
by the clubs which are obligations of the Partnership. For the six month
period ended June 30, 1995, the Partnership was obligated to reimburse its
equity clubs approximately $44,900. At June 30, 1995, approximately
$63,800 was unpaid, including amounts from the prior year, of which
approximately $6,400 was received as of August 4, 1995.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

The Partnership also funds operating deficits of its equity clubs, as
deemed necessary. Such amounts are expensed by the Partnership, but may be
reimbursed by these clubs from future cash flow. At June 30, 1995, the
Partnership owed approximately $411,200 for such funding, none of which was
paid as of August 4, 1995.

The Partnership periodically incurs salary and salary-related costs on
behalf of an affiliate of the General Partner of the Partnership. The
Partnership was entitled to receive approximately $380,600 for such costs
for the six months ended June 30, 1995, all of which was paid as of June
30, 1995.

In accordance with the Partnership Agreement, the General Partner and
Associate Limited Partners have deferred a portion of their distributions
of net cash flow from the Partnership totalling approximately $1,208,700.
This amount does not bear interest and is expected to be paid in future
periods subject to certain restrictions contained in the Partnership's
credit facility agreement.

All amounts receivable or payable to the General Partner or its
affiliates do not bear interest and are expected to be paid in future
periods.

(7) COMMITMENTS AND CONTINGENCIES

As security for performance of certain development obligations, the
Partnership is contingently liable under standby letters of credit and
performance bonds for approximately $9,773,800 and $7,588,700,
respectively, at June 30, 1995. At December 31, 1994, the Partnership was
contingently liable under standby letters of credit and performance bonds
for approximately $10,170,000 and $7,588,700, respectively. In addition,
certain joint ventures in which the Partnership holds an interest are also
contingently liable under bonds for approximately $1,020,000 at June 30,
1995 and December 31, 1994.

The Partnership was named a defendant in a number of homeowner
lawsuits, certain of which purported to be class actions, that allegedly in
part arose out of or related to Hurricane Andrew, which on August 24, 1992
resulted in damage to a former community development known as Country Walk.

The homeowner lawsuits alleged, among other things, that the damage
suffered by the plaintiffs' homes and/or condominiums within Country Walk
was beyond what could have been reasonably expected from the hurricane
and/or was a result of the defendants' alleged defective design,
construction, inspection and/or other improper conduct in connection with
the development, construction and sales of such homes and condominiums,
including alleged building code violations. The various plaintiffs sought
varying and, in some cases, unspecified amounts of compensatory damages and
other relief. In certain of the lawsuits injunctive relief and/or punitive
damages were sought.

Several of these lawsuits allege that the Partnership was liable,
among other reasons, as a result of its own alleged acts of misconduct or
as a result of the Partnership's assumption of Arvida Corporation's
liabilities in connection with the Partnership's purchase of Arvida
Corporation's assets from Disney in 1987, which included certain assets
related to the Country Walk development. Pursuant to the agreement to
purchase such assets, the Partnership obtained indemnification by Disney
for certain liabilities relating to facts or circumstances arising or
occurring prior to the closing of the Partnership's purchase of the assets.

Over 80% of the Arvida-built homes in Country Walk were built prior to the

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

Partnership's ownership of the Community. Where appropriate, the
Partnership has tendered or will tender each of the above-described
lawsuits to Disney for defense and indemnification in whole or in part
pursuant to the Partnership's indemnification rights. Where appropriate,
the Partnership has also tendered these lawsuits to its various insurance
carriers for defense and coverage. The Partnership is unable to determine
at this time to what extent damages in these lawsuits, if any, against the
Partnership, as well as the Partnership's cost of investigating and
defending the lawsuits, will ultimately be recoverable by the Partnership
either pursuant to its rights of indemnification by Disney or under
contracts of insurance.

On August 10, 1993, the Circuit Court of Dade County issued a final
order approving the terms of a class action settlement with opposing
counsel in one of the pending homeowners' lawsuits which resolved
substantial portions of the pending homeowners' lawsuits that had been
filed. The settlement, which is designed to resolve claims arising in
connection with estate and patio homes and condominiums sold by the
Partnership after September 10, 1987, is structured to compensate residents
for losses not covered by insurance. Homeowners of approximately 85% of
the units in Country Walk have accepted the settlement. The Partnership
currently believes that the class action settlement may cost approximately
$2.5 million. The settlement is being funded by one of the Partnership's
insurers, subject to a reservation of rights. The amount of money, if any,
which the insurance company may recover from the Partnership pursuant to
its reservation of rights, or otherwise, is uncertain. Due to this
uncertainty, the accompanying consolidated financial statements do not
reflect an accrual for such costs.

On February 24, 1994, the Partnership was dismissed from the pending
class action homeowner lawsuits pursuant to the class action settlement
discussed above. In addition, the Partnership has been informed that
Disney and an insurer have reached agreements to settle five of the
individual homeowners actions which were tendered by the Partnership to
Disney. These Disney settlements were funded without any contribution from
the Partnership.

Homeowners who affirmatively rejected the offer of settlement by
opting out were permitted to continue litigation against the Partnership.
The Partnership was and is party to a number of claims brought by
condominium and patio homeowners, all of whom have declined to accept the
terms of the class action settlement. Some of these actions by those
homeowners who have opted out of the settlement have been settled. The
aggregate amount of these settlements to date is approximately $414,000.
One of the Partnership's insurers has funded these settlements. The amount
of money that the insurance company may recover from the Partnership
pursuant to any reservation of rights, or otherwise, is uncertain.
Therefore, the accompanying consolidated financial statements do not
reflect any accruals related to this matter. Currently, the Partnership is
involved in five lawsuits with homeowners who have opted out of the
original settlement which are pending in the Circuit Court of Dade County
and one claim that has not been filed as a lawsuit. Recently, the
Partnership has agreed in principle to resolve these remaining opt out
lawsuits. The settlement amounts necessary to resolve these matters is
expected to be approximately $106,000. The Partnership can give no
assurances that such settlement will in fact be consummated and the
accompanying consolidated financial statements do not reflect an accrual
for such costs.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

On April 19, 1993, a subrogation claim entitled Village Homes at
Country Walk Master Maintenance Association, Inc. v. Arvida Corporation et
al., was filed in the 11th Judicial Circuit for Dade County. Plaintiffs
filed this suit for the use and benefit of American Reliance Insurance
Company ("American Reliance"). In this suit, as amended, plaintiffs seek
to recover damages and pre- and post-judgment interest in connection with
$10,873,000 American Reliance has allegedly paid, plus amounts it may have
to pay in the future, to the condominium association at Country Walk in the
wake of Hurricane Andrew. Disney is also a defendant in this suit. The
Partnership believes that the amount of this claim that allegedly relates
to units it sold is approximately $3,600,000. Plaintiffs also seek a
declaratory judgement seeking to hold the Partnership and other defendants
responsible for amounts American Reliance must pay in the future to its
insured as additional damages beyond the $10,873,000 previously paid. The
Partnership has filed motions directed to the complaint, as amended, and
the litigation is in the discovery stage. The Partnership intends to
vigorously defend itself.

The Partnership has also been involved in subrogation lawsuits or
threatened subrogation actions with Prudential Property and Casualty
Company, Travelers Insurance Company ("Travelers"), Allstate Insurance
Company ("Allstate") and State Farm Insurance Company. These insurance
companies sought to recover damages, costs and interest in connection with
amounts allegedly paid to their insureds living in Country Walk at the time
of Hurricane Andrew. The Partnership settled these claims and all
settlement proceeds were funded by one of the Partnership's insurance
carriers. The aggregate amount of these settlements is approximately $4.3
million. The Allstate and Travelers settlements were funded subject to a
reservation of rights by one of the Partnership's insurance carriers. The
amount of money the insurance carrier may seek to recover from the
Partnership for these and any other settlements it has funded is uncertain.

Therefore, the accompanying consolidated financial statements do not
reflect any accruals related to this matter. The Partnership is a defendant
in and anticipates other subrogation claims by insurance companies which
have allegedly paid policy benefits to Country Walk residents. The
Partnership intends to defend itself vigorously in all such matters.

The Partnership has also resolved a claim brought by the Villages of
Country Walk Homeowners' Association, Inc., and related entities, for
damages to the common elements of the condominium units at Country Walk. A
settlement in the amount of $2,740,000 was paid by the Partnership's
insurance carriers. A reservation of rights in connection with these
claims of approximately $740,000 was issued by one insurance carrier. The
extent to which the insurance company may ultimately recover any of these
proceeds from the Partnership is unknown. Therefore, the accompanying
consolidated financial statements do not reflect any accruals related to
this matter.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

the remainder of the Hurricane Andrew litigation, allegedly without waiving
any future coverage defenses, conditions, limitations, or rights. For this
and other reasons, the extent to which the insurance carrier may recover
any of these proceeds from the Partnership is uncertain. Therefore, the
accompanying consolidated financial statements do not reflect any accruals
related to this matter.

A second amended complaint captioned Berry v. Merrill Lynch, Pierce
Fenner & Smith, Arvida/JMB Partners, Limited Partnership, Arvida/JMB
Managers, Inc., JMB Realty Corporation and Does 1 through 100, was filed in
the Superior Court of the State of California in and for the County of San
Diego, Case No. 669709. The lawsuit was purportedly filed as a class
action on behalf of the named plaintiffs and all other persons or entities
in the State of California who bought or acquired, directly or indirectly,
limited partnership interests ("Interests") in the Partnership from
September 1, 1987 through the present. The second amended complaint in the
action alleges, among other things, that the defendants made
misrepresentations and concealed various facts, breached fiduciary duties,
and violated a contractual covenant of good faith in connection with the
sale of Interests in the Partnership. The second amended complaint further
alleges that such conduct violated California state law relating to fraud,
constructive fraud, breach of fiduciary duty, willful suppression of facts,
breach of the covenant of good faith, and conspiracy. Plaintiffs, on
behalf of themselves and the purported plaintiff class, seek unspecified
compensatory damages, consequential damages, punitive and exemplary
damages, recission, interest, costs of the suit, and such other relief as
the court may order. In October 1994, after the court denied defendants'
demurrers, defendants answered the second amended complaint denying the
material allegations of the complaint and setting forth various affirmative
defenses. During March 1995, the court issued an order that it would not
entertain any motions for certification of a class. Subsequent thereto,
defendants have entered into a settlement agreement in order to put to rest
all controversy and to avoid further disruption to defendants' ordinary
business operations and the expense, burden and risk of protracted
litigation. The settlement is not an admission of liability, which the
defendants expressly deny. The settlement will not result in the payment
of a material amount by the defendants.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

has resolved some of these claims through litigation and otherwise, and
that Merrill Lynch is defending other claims. The Agency Agreement
generally provides that the Partnership and its General Partner shall
indemnify Merrill Lynch against losses occasioned by any actual or alleged
misstatements or omissions of material facts in the Partnership's offering
materials used in connection with the sale of Interests and suffered by
Merrill Lynch in performing its duties under the Agency Agreement, under
certain specified conditions. The Agency Agreement also generally
provides, under certain conditions, that Merrill Lynch shall indemnify the
Partnership and its General Partner for losses suffered by the Partnership
and occasioned by certain specified conduct by Merrill Lynch in the course
of Merrill Lynch's solicitation of subscriptions for, and sale of,
Interests. The Partnership is unable to determine at this time the
ultimate investment of investors who have filed arbitration claims as to
which Merrill Lynch might seek indemnification in the future. At this
time, and based upon the information presently available about the
arbitration statements of claims filed by some of these investors, the
Partnership and its General Partner believe that they have meritorious
defenses to demands for indemnification made by Merrill Lynch and intend to
vigorously pursue such defenses. Although there can be no assurance
regarding the outcome of the claims for indemnification, at this time,
based on information presently available about such arbitration statements
of claims, the Partnership and its General Partner do not believe that the
demands for indemnification by Merrill Lynch will have a material adverse
effect on the financial condition of the Partnership.

The Partnership is also a defendant in several other actions brought
against it arising in the normal course of business. It is the belief of
the General Partner, based on knowledge of facts and advice of counsel,
that the claims made against the Partnership in such actions will not
result in any material adverse effect on the Partnership's consolidated
financial position or results of operations.

The Partnership owns a 50% joint venture interest in 31 commercial /
industrial acres in Pompano Beach, Florida, which is encumbered by a
mortgage loan in the principal amount of approximately $4 million at June
30, 1995. As a result of the Partnership's previous determination that the
development of the land was no longer economically profitable, during April
1992, the Partnership and its joint venture partner each tendered payment
in the amount of approximately $3.1 million to the lender for their
respective shares of the guarantee payment required under the loan
agreement and certain other holding costs, the majority of which reduced
the outstanding mortgage loan to its current balance. The venture also
intended at that time to convey title to the property to the lender;
however, such conveyance was deferred pending resolution of certain general
development obligations of the venture as well as certain environmental
issues. The Partnership had been negotiating with the lender regarding the
scope of the development and environmental work required to be done.
Negotiations with the lender were unsuccessful, and the lender has filed a
lawsuit with the Broward County Circuit Court in which the lender asserts,
among other things, that the mortgage loan is with recourse to the joint
venture partners as a result of the partners' failure to perform in
accordance with the terms of the loan agreement. The lender is demanding
payment of the outstanding loan balance plus interest thereon. The
Partnership believes this claim is without merit and is vigorously
defending the lawsuit. With respect to the environmental issues, the
previous owner remains obligated to undertake the clean up pursuant to,
among other things, a surviving obligation under the purchase and sale
agreement. The clean-up began in July 1994, and the first phase of the
remedial action plan was completed in October 1994. Further action plans

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

are now underway. If the previous owner is unable to fulfill all its
obligations as they relate to this environmental issue, the venture and
ultimately the Partnership may be obligated for such costs. Should this
occur, the Partnership does not anticipate the cost of this clean-up to be
material to its operations.

The Partnership is seeking a permit to develop approximately 1,166 of
the approximate 2,475 gross acres contained in Increment III of the Weston
Community, portions of which are environmentally sensitive areas and are
subject to protection as wetlands. The Partnership's current application
for a wetlands permit for Increment III, as modified on July 31, 1995,
includes proposed wetlands mitigation of approximately 1,553 acres,
improvement of the mitigation area as functioning wetlands, including
development refuge habitat areas, and ongoing maintenance and monitoring of
the wetlands, together with construction of schools, parks, roads, sewers
and related infrastructure, in addition to residential and commercial
development on approximately 1,166 acres. This includes approximately 226
acres of land owned by the Partnership outside of Increment III, which was
acquired to augment the Partnership's mitigation response to The United
States Army Corps of Engineers (the "Corps"), which is the governmental
agency responsible for issuing permits involving development of wetlands
areas.

The EPA's position that no more than 120 gross acres in Increment III
should be permitted to be developed, its recommendation that adequate
compensatory mitigation be implemented in connection with such development,
the Partnership believes, based on further dialogue with the EPA, that the
EPA no longer adheres to that view, but as of this date has not formally
retracted its August 1994 position and the Partnership continues to pursue
issuance of the permit for development of Increment III on the terms and
conditions previously set forth in its application, as modified on July 31,
1995. The Corps has rejected the recommendation of the EPA and has advised
the Partnership that it is continuing to consider the Partnership's current
application as modified on July 31, 1995. During October 1994, the Corps
performed an independent analysis of the wetlands impact and mitigation,
and on May 15, 1995, the Partnership received a formal response from the
Corps regarding the results of this analysis. The Corps response contained
a computation of wetland impacts and mitigation credits showing a net loss
of 59 functional units as analyzed by the Corps. The Corps required the
Partnership to demonstrate mitigation for wetland impacts resulting from
the project and how the Partnership would avoid a loss of the 59 functional
units. The Partnership filed submittal submission No. 7 on July 31, 1995
describing how the Partnership proposes to overcome the deficit and that
analysis has been accepted by the Corps. The Partnership's application is
now in a 30 day comment period expiring September 1, 1995 after which the
Partnership anticipates final comments to be received from the Corps.

If the Corps ultimately issues a permit generally on the same terms
and conditions as set forth in the Partnership's amended application, the
EPA retains certain rights to veto or to seek to elevate the determination
to issue a permit to higher governmental officials. Elevation would delay
the effectiveness of the permit and could result in a decision to uphold,
modify or retract issuance of the permit. If the Partnership does not
ultimately receive its permit through the administrative process, it may
seek a judicial review in Federal district court of the denial of the
permit. Additionally, the Partnership could initiate an action in the
United States Court of Federal Claims seeking a determination that denial
of the permit constitutes a "taking" of the Partnership's property for
which the Partnership is due just compensation. The pursuit of these legal
actions would likely be lengthy.

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

The Partnership continues to believe that it will ultimately obtain a
permit from the Corps to develop Increment III of the Weston Community on
substantially the same terms and conditions for which it has currently
applied, including the July 31, 1995 modification. However, there is no
assurance that such permit will in fact be obtained or, if not obtained,
that the Partnership would be successful in pursuing the above-mentioned
legal actions. In addition, if such a permit were obtained, the
Partnership would also need certain other approvals, including state and
local approvals, to develop Increment III in accordance with the
Partnership's current development plans. If such permits and other
approvals are not obtained, the Partnership would be required to revise its
development plans for the remaining portions of Increment I and II of the
Weston Community, as well as its development plans for Increment III. Such
revisions would have a material adverse impact on the timing and amount of
net income and net cash flow ultimately realized by the Partnership from
the development of the Weston Community.

The Partnership may be responsible for funding certain other ancillary
activities for related entities in the ordinary course of business which
the Partnership does not currently believe will have any material effect on
its consolidated financial position or results of operations.

(8) TAX INCREMENT FINANCING ENTITIES

In connection with the development of the Partnership's Weston
Community, bond financing is utilized to construct certain on-site and off-
site infrastructure improvements, including major roadways, lakes, other
waterways and pump stations, which the Partnership would otherwise be
obligated to finance and construct as a condition to obtain certain
approvals for the project. This bond financing is obtained by The Indian
Trace Community Development District ("District"), a local government
district operating in accordance with Chapter 190 of the Florida Statutes.
Under this program, the Partnership is not obligated directly to repay the
bonds. Rather, the bonds are expected to be fully serviced by special
assessment taxes levied on the property, which effectively collateralizes
the obligation to pay such assessments. The Partnership is responsible to
pay the special assessment taxes until land parcels are sold. At such
point, the liability for the assessments related to parcels sold will be
borne by the purchasers through a tax assessment on their property. These
special assessment taxes are designed to cover debt service on the bonds,
including principal and interest payments, as well as the operating and
maintenance budgets of the District. The use of this type of bond
financing is a common practice for major land developers in South Florida.
For the twelve months ended December 31, 1994, the Partnership paid special
assessments of approximately $5.0 million.

The District issued $64,660,000 of variable rate bonds in November
1989 and $31,305,000 of variable rate bonds in July 1991. These bonds
mature in various years commencing in May 1991 through May 2011. In order

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

to reduce the exposure of variable rate debt, the District pursued new bond
issuances. During March 1995, the District issued approximately $99
million of bonds at fixed rates of interest ranging from 4% to 8.25% per
annum. These bonds mature in various years commencing May 1999 through May
2011. The proceeds from this offering were used to refund the outstanding
1989 and 1991 bonds described above, as well as to fund the issuance costs
incurred in connection with this offering and deposits to certain reserve
accounts for future bond debt service requirements. At June 30, 1995, the
amount of bonds issued and outstanding totalled $98,575,000.

(9) PARTNERSHIP AGREEMENT

Pursuant to the terms of the Partnership Agreement (and subject to
Section 4.2F which allocates Profits, as defined, to the General Partner
and Associate Limited Partners), profits or losses of the Partnership will
be allocated as follows: (i) profits will be allocated such that the
General Partner and the Associate Limited Partners will be allocated
profits equal to the amount of cash flow distributed to them for such
fiscal period with the remainder allocated to the Limited Partners, except
that in all events, the General Partner shall be allocated at least 1% of
profits and (ii) losses will be allocated 1% to the General Partner, 1% to
the Associate Limited Partners and 98% to the Limited Partners.

In the event profits to be allocated in any given year do not equal or
exceed cash distributed to the General Partner and the Associate Limited
Partners for such year, the allocation of profits will be as follows: The
General Partner and the Associate Limited Partners will be allocated
profits equal to the amount of cash flow distributed to them for such year.

The Limited Partners will be allocated losses such that the sum of amounts
allocated to the General Partner, Associate Limited Partners, and Limited
Partners equals the net profit for the given year.

Section 4.2F of the Partnership Agreement requires the allocation of
Profits (as defined) to the General Partner and Associate Limited Partners
in order to take account of a current or anticipated reduction in the
Partnership's indebtedness and certain other circumstances. As the
Partnership had net income for financial reporting and Federal income tax
purposes for the six months ended June 30, 1995, an allocation of Profits
to the General Partner and Associate Limited Partners in accordance with
Section 4.2F of the Partnership Agreement was not required for this period.

In future periods in which the Partnership incurs a loss, the General
Partner and Associate Limited Partners may be allocated Profits pursuant to
Section 4.2F equivalent to the amount of loss (as adjusted for such
allocation of Profits), if any, allocable to them for financial reporting
and Federal income tax purposes.

In general, and subject to certain limitations, the distribution of
Cash Flow (as defined) after the initial admission date is allocated 90% to
the Holders of Interests and 10% to the General Partner and the Associate
Limited Partners (collectively) until the Holders of Interests have
received cumulative distributions of Cash Flow equal to a 10% per annum
return (non-compounded) on their Adjusted Capital Investments (as defined)
plus the return of their Capital Investments; provided, however, that
4.7369% of the 10% amount otherwise distributable to the General Partner
and Associate Limited Partners (collectively) will be deferred, and such
amount will be paid to the Holders of Interests, until the Holders of
Interests receive Cash Flow distributions equal to a cumulative, non-
compounded amount of 12% per annum on their Capital Investments (as
defined). This deferral provision is in place until the Holders of
Interests receive total cash distributions equal to their Capital
Investments. Any deferred amounts owed to the General Partner and

ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED

Associate Limited Partners (collectively) will be distributable to them out
of Cash Flow otherwise distributable to the Holders of Interests at such
time as such Holders have received a 12% per annum cumulative, non-
compounded return on their Capital Investments (as defined) or in any
event, to the extent of one-half of Cash Flow otherwise distributable to
the Holders of Interests at such time as they have received total
distributions of Cash Flow equal to their Capital Investments (as defined).

Thereafter, all distributions of Cash Flow will be made 85% to the Holders
of Interests and 15% to the General Partner and the Associate Limited
Partners (collectively); provided, however, that the General Partner and
the Associate Limited Partners (collectively) shall be entitled to receive
an additional share of Cash Flow otherwise distributable to the Holders of
Interests equal to the lesser of an amount equal to 2% of the cumulative
gross selling prices of any interests in real property of the Partnership
(subject to certain limitations) or 13% of the aggregate distributions of
Cash Flow to all parties pursuant to this sentence.

(10) ADJUSTMENTS

In the opinion of the General Partner, all adjustments (consisting
solely of normal recurring adjustments) necessary for a fair presentation
have been made to the accompanying consolidated financial statements as of
June 30, 1995 and December 31, 1994 and for the three and six month periods
ended June 30, 1995 and 1994.

PART I. FINANCIAL INFORMATION

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

All references to "Notes" are to Notes to Consolidated Financial
Statements contained in this report.

At June 30, 1995 and December 31, 1994, the Partnership had cash and
cash equivalents of approximately $6,209,400 and $22,024,400, respectively.

The decrease in cash and cash equivalents at June 30, 1995 as compared to
December 31, 1994 is due primarily to required debt service payments as
well as distributions to partners made in February 1995, as further
discussed below. Remaining cash and cash equivalents were available for
debt service and working capital requirements. The source of both short-
term and long-term future liquidity is expected to be derived primarily
from the sale of housing units, homesites and land parcels and through the
Partnership's credit facilities, which are discussed below.

As a result of management's decision to place more emphasis on the
Partnership's homebuilding operations, management's efforts to broaden the
product lines offered within the Partnership's Communities, as well as the
robust housing market, the Partnership was able to generate significant
cash flow before debt service during 1994. The Partnership utilized this
excess cash flow to make scheduled and additional principal repayments on
its outstanding debt, as required under the terms of the credit facility
agreement, and to increase its cash reserves. Furthermore, in February
1995, the Partnership made a distribution for 1994 of $5,421,680 to its
Limited Partners ($13.42 per Interest) and $301,201 to the General Partner
and Associate Limited Partners, collectively. In addition, during the
first quarter of 1995, the Partnership remitted each Limited Partner's
share of a North Carolina non-resident withholding tax on behalf of each of
the Limited Partners. Such payment, which totalled $26,784 ($.07 per
Interest), was deemed a distribution to the Limited Partners. An
additional distribution of $1,488 was also paid at that time to the General
Partner and Associate Limited Partners, collectively, a portion of which
was also remitted to the state tax authorities on their behalf.

Despite some weakness in the housing market, based upon current
inventory levels as well as the outstanding contracts for housing units and
homesites, the Partnership currently anticipates that the Partnership will
generate net cash flow in excess of scheduled debt service during 1995.

At June 30, 1995, the Partnership's credit facility consists of a term
loan in the original amount of $85,252,520, a revolving line of credit
facility up to $20 million, an income property term loan in the original
amount of $18,233,326 and a $15 million letter of credit facility. The
term loan, the revolving line of credit and the letter of credit facility
are secured by recorded mortgages on all otherwise unencumbered real
property assets of the Partnership as well as an assignment of all
mortgages receivable, equity memberships, certain joint venture interests
or joint venture proceeds, and cash balances (with the exception of
deposits held in escrow). The income property term loan is secured by the
recorded first mortgage on a mixed-use center in Boca Raton, Florida. An
office building also located in Boca Raton which served as additional
collateral for the income property term loan was sold in May 1995. All of
the notes under the facility are cross-collateralized and cross-defaulted.

Under the term loan agreement, the Partnership made scheduled
principal payments of $10 million in March 1994 and February 1995 and a $5
million principal payment in July 1995. In addition, the term loan
agreement provides for additional principal repayments based upon a
specified percentage of available cash flow and upon the sale of certain
assets. During the six months ended June 30, 1995, the Partnership made
such additional term loan payments totalling approximately $20.0 million.
Principal repayments of $10 million and $5 million on the term loan are due
in February 1996 and July 1996, respectively. The remaining balance
outstanding is due in July 1997. Under the income property term loan,
principal payments of $0.1 million are required to be paid monthly until
March 1996 when the remaining outstanding principal balance will be due.
The revolving line of credit matures in December 1995. The letter of
credit facility had been scheduled to mature in July 1995, but has been
extended for one year and will mature in July 1996. At June 30, 1995, all
of the term loan proceeds had been borrowed with a remaining balance of
$43,461,864. The balances outstanding on the revolving line of credit
facility, the income property term loan and the letter of credit facility
at June 30, 1995 are $10,000,000, $13,366,746 and $9,773,800, respectively.

The credit facility contains significant restrictions with respect to
the payment of distributions to partners, the maintenance of certain loan-
to-value ratios, the use of proceeds from the sale of the Partnership's
assets, and advances to the Partnership's joint ventures. Although the
Partnership's term loan, income property term loan, revolving line of
credit and letter of credit facility mature at varying dates ranging from
December 1995 to July 1997, as discussed above, the Partnership believes
that the current and expected future liquidity and capital resources of the
Partnership, including its credit facilities, generally should be adequate
to fund currently expected short- and long-term capital requirements for
development and other costs of operations. At this time, the Partnership
anticipates renewing certain of its facilities with its lenders at the time
of their maturities. Although there can be no assurance, the Partnership
currently believes that it will be able to obtain such renewals from its
lenders.

The Partnership has executed a contract to purchase approximately 241
acres of undeveloped land adjacent to its River Hills Community located
near Tampa, Florida for an acquisition price of approximately $3.2 million.

The Partnership plans to develop and market this land as part of the River
Hills Community. The Partnership is currently in the due diligence phase
with respect to this potential acquisition and there can be no assurance
that a final agreement will be reached with the seller on terms acceptable
to the Partnership.

The Partnership has a $28.9 million revolving construction line of
credit for three buildings and certain amenities within the Partnership's
condominium project on Longboat Key, Florida known as Arvida's Grand Bay.
This line of credit, currently, bears interest at the lender's prime rate
(9% at June 30, 1995) plus 1/2% per annum and matures in January 1997. At
June 30, 1995, approximately $4.4 million was outstanding under this note
related to two buildings currently under construction. The Partnership
currently anticipates that this amount will be repaid from the proceeds
from the sale of condominium units within these two buildings. The receipt
of sales proceeds from units sold within the first building prior to
December 31, 1994 which closed during the six months ended June 30, 1995 is
the primary cause of the decrease in trade and other accounts receivable at
June 30, 1995 as compared to December 31, 1994.

The Partnership is seeking a permit to develop approximately 1,166 of
the approximate 2,475 gross acres contained in Increment III of the Weston
Community, portions of which are environmentally sensitive areas and are
subject to protection as wetlands. The Partnership's current application
for a wetlands permit for Increment III, as modified on July 31, 1995,
includes proposed wetlands mitigation of approximately 1,553 acres,
improvement of the mitigation area as functioning wetlands, including
development refuge habitat areas, and ongoing maintenance and monitoring of
the wetlands, together with construction of schools, parks, roads, sewers
and related infrastructure, in addition to residential and commercial
development on approximately 1,166 acres. This includes approximately 226
acres of land owned by the Partnership outside of Increment III, which was
acquired to augment the Partnership's mitigation response to the United
States Army Corps of Engineers (the "Corps"), which is the governmental
agency responsible for issuing permits involving development of wetlands
areas.

The EPA's position that no more than 120 gross acres of Increment III
should be permitted to be developed, its recommendation that adequate
compensatory mitigation be implemented in connection with such development,

the Partnership believes, based on further dialogue with the EPA that the
EPA no longer adheres to that view, but as of this date has not formally
retracted its August 1994 position and the Partnership continues to pursue
issuance of the permit for development of Increment III on the terms and
conditions previously set forth in its application, as modified on July 31,
1995. The Corps has rejected the recommendation of the EPA and has advised
the Partnership that it is continuing to consider the Partnership's current
application as modified on July 31, 1995. During October 1994, the Corps
performed an independent analysis of the wetlands impact and mitigation and
on May 15, 1995 the Partnership received a formal response from the Corps
regarding the results of this analysis. The Corps response contained a
computation of wetland impacts and mitigation credits showing a net loss of
59 functional units as analyzed by the Corps. The Corps required the
Partnership to demonstrate mitigation for wetland impacts resulting from
the project and how the Partnership would avoid a loss of the 59 functional
units. The Partnership filed submittal submission No. 7 on July 31, 1995
describing how the Partnership proposes to overcome the deficit and that
analysis has been accepted by the Corps. The Partnership's application is
now in a 30 day comment period expiring September 1, 1995 after which the
Partnership anticipates final comments to be received from the Corps.

In addition, the Partnership has been advised by Merrill Lynch that
Merrill Lynch has been named a defendant in actions pending in the Eleventh
and Seventeenth Judicial Circuit Courts in Dade and Broward Counties,
Florida to compel arbitration of claims brought by certain investors of the
Partnership representing approximately 5% of the total of 404,000 Interests
outstanding. Merrill Lynch has asked the Partnership and its General
Partner to confirm an obligation of the Partnership and its General Partner
to indemnify Merrill Lynch in these claims against all loss, liability,
claim, damage and expense, including without limitation attorneys' fees and
expenses, under the terms of a certain Agency Agreement dated September 15,
1987 ("Agency Agreement") with the Partnership relating to the sale of
Interests through Merrill Lynch on behalf of the Partnership. In the
actions to compel arbitration, the claimants have advised Merrill Lynch
that they would seek to file demands for arbitration and claims for
unspecified damages against Merrill Lynch based on Merrill Lynch's alleged
violation of applicable state and/or federal securities laws and alleged
violations of the rules of the National Association of Securities Dealers,
Inc., together with pendent state law claims. Some of these investors have
begun the arbitration process. The Partnership believes that Merrill Lynch
has resolved some of these claims through litigation, and otherwise; and
that Merrill Lynch is defending other claims. The Agency Agreement
generally provides that the Partnership and its General Partner shall
indemnify Merrill Lynch against losses occasioned by any actual or alleged
misstatements or omissions of material facts in the Partnership's offering
materials used in connection with the sale of Interests and suffered by
Merrill Lynch in performing its duties under the Agency Agreement, under
certain specified conditions. The Agency Agreement also generally
provides, under certain conditions, that Merrill Lynch shall indemnify the
Partnership and its General Partner for losses suffered by the Partnership
and occasioned by certain specified conduct by Merrill Lynch in the course
of Merrill Lynch's solicitation of subscriptions for, and sale of,
Interests. The Partnership is unable to determine at this time the
ultimate investment of investors who have filed arbitration claims as to
which Merrill Lynch might seek indemnification in the future. At this
time, and based upon the information presently available about the
arbitration statements of claims filed by some of these investors, the
Partnership and its General Partner believe that they have meritorious
defenses to demands for indemnification made by Merrill Lynch and intend to
vigorously pursue such defenses. Although there can be no assurance
regarding the outcome of the claims for indemnification, at this time,
based on information presently available about such arbitration statements
of claims, the Partnership and its General Partner do not believe that the
demands for indemnification by Merrill Lynch will have a material adverse
effect on the financial condition of the Partnership.

Reference is made to Part II - OTHER INFORMATION - Item 1. Legal
Proceedings, for a discussion of various lawsuits, in which the Partnership
is a defendant, allegedly arising out of or relating to Hurricane Andrew
and certain property damage allegedly suffered by the plaintiffs at a
previously developed community known as Country Walk.

RESULTS OF OPERATIONS

The results of operations for the three and six months ended June 30,
1995 and 1994 are primarily attributable to the development and sale or
operation of the Partnership's assets. See Note 1 for a discussion
regarding the recognition of profit from sales of real estate.

For the quarter ended June 30, 1995, the Partnership (including its
consolidated joint ventures) closed on the sale of 309 housing units, 120
homesites, approximately 127 acres of undeveloped land tracts, as well as
an office building located in downtown Boca Raton, Florida known as Mizner
Place. This compares to closings in the second quarter of 1994 of 248
housing units, 143 homesites and approximately ten acres of developed and
undeveloped land tracts. Outstanding contracts ("backlog") as of June 30,
1995 were for 987 housing units, 77 homesites and approximately 10 acres of
developed and undeveloped land tracts. This compares to a backlog as of
June 30, 1994 of 880 housing units, 95 homesites and approximately 28 acres
of developed and undeveloped land tracts.

The Partnership's Communities are in various stages of development,
with estimated remaining build-outs ranging from one to ten years. The
Partnership's condominium project on Longboat Key, Florida known as
Arvida's Grand Bay, is in its early stage of development. The Weston
Community, located in Broward County, Florida, is the Partnership's largest
Community and is in its mid stage of development. Also in their mid stages
of development are the River Hills Country Club in Tampa, Florida;
Jacksonville Golf and Country Club in Jacksonville, Florida; the Water's
Edge Community in Atlanta, Georgia and The Cullasaja Club, near Highlands,
North Carolina. The Partnership's remaining Communities known as Sawgrass
Country Club, in Jacksonville, Florida and Dockside in Atlanta, Georgia are
in their final stages of development with anticipated close-outs in 1996.
In addition, the Broken Sound Community, located in Boca Raton, Florida, is
nearing completion with an anticipated close-out in 1995. Future revenues
will be impacted to the extent that there are lower levels of inventories
available for sale as these Communities approach or undertake their final
phases.

Revenues from housing and homesite activities are recognized upon the
closing of homes built by the Partnership and developed lots, respectively,
within the Partnership's Communities. Land and property revenues are
generated from the closing of developed and undeveloped residential and/or
commercial land tracts, the sale of operating properties as well as gross
revenues earned from the sale of equity memberships in the clubs within the
Partnership's Boca Raton and Jacksonville, Florida Communities, as well as
its Community near Highlands, North Carolina.

Cost of revenues pertaining to the Partnership's housing sales reflect
the cost of the acquired assets as well as development and construction
expenditures, certain capitalized overhead costs, capitalized interest,
real estate taxes and marketing, as well as disposition costs. The costs
related to the Partnership's homesite sales reflect the cost of the
acquired assets, related development expenditures, certain capitalized
overhead costs, capitalized interest and real estate taxes, as well as
disposition costs. Land and property costs reflect the cost of the
acquired assets, certain development costs and related disposition costs,
as well as the cost associated with the sale of equity memberships.

South Florida building code changes, which have been effective since
September 1, 1994, have impacted construction requirements in Dade and
Broward Counties. These building code changes have resulted in increased
construction costs, not all of which have been recoverable from the home
purchasers at this time. As a result, the Partnership anticipates some
erosion in its gross operating profit margins from housing and homesite
sales during 1995 as compared to 1994.

Historically, a substantial portion of the Partnership's housing
revenues during the first six month of a given year are generated from the
closing of units contracted in the prior year. The increase in housing
revenues for the six months ended June 30, 1995 as compared to the same
period in 1994 is primarily attributable to the substantial increase in the
backlog of unclosed housing units at the Partnership's Weston Community at
December 31, 1994 in comparison to December 31, 1993. The favorable
variances in housing revenues is partially offset by a decrease in the
number of units closed at the Partnership's Broken Sound Community which is
nearing close-out. Also offsetting the favorable variance in housing
revenues was a decline in the amount of revenue recognized under the
percentage of completion method at Arvida's Grand Bay on Longboat Key,
Florida. The Partnership recognized the initial revenue from this project
in May of 1994.

The decline in the number of closings at the Partnership's Broken
Sound Community as well as the decline in revenues recognized at Arvida's
Grand Bay are primarily the cause for the decrease in revenues for the
three months ended June 30, 1995 as compared to the same period in 1994.

The gross operating profit margin from housing activity decreased for
the three and six months ended June 30, 1995 primarily as a result of the
substantial decline in the number of units closed at the Partnership's
Broken Sound Community. Due to the substantial sell-out during 1994 and
early 1995 of the higher priced, higher profit margin product built by the
Partnership in this Community, future gross operating margins from housing
activities are not expected to be as high as recent years' margins. The
mix of the product sold at the Partnership's Weston Community also
contributed to the decrease in the gross operating profit margin from
housing activity for the three and six month periods ended June 30, 1995 as
compared to the same periods in 1994.

The decrease in homesite revenues for the three and six months ended
June 30, 1995 as compared to the same periods in 1994 is due primarily to
fewer lot closings in the Partnership's Communities in Weston and
Jacksonville, Florida. These decreased closings and revenues are directly
attributable to the implementation of managements's decision to place more
emphasis on its home building operations. Homesite revenues increased for
the three month period ended June 30, 1995 in comparison to the three month
period ended March 31, 1995 primarily as a result of the introduction of
new product in the Partnership's Weston as well as the timing of lot
closings by unaffiliated third party builders in the Community. In spite
of this increase during the second quarter, homesite revenue for 1995 are
expected to fall substantially below amounts recognized in prior years.

The decrease in the gross operating profit margin from homesite
activities for the six months ended June 30, 1995 as compared to the same
period in 1994 is due primarily to certain adjustments made to the cost of
sales in the first quarter of 1994 to reflect changes in development cost
estimates for certain of the Partnership's products, primarily in the
Weston Community.

The increase in land and property revenues for the three and six
months ended June 30, 1995 as compared to the same periods in 1994 is due
to the closings in 1995 of approximately 67.3 acres of undeveloped
commercial land parcels in Palm Beach County, Florida, the sale of the
Partnership's cable operation in its Broken Sound Community and the sale of
an office building located in downtown Boca Raton, Florida known as Mizner
Place. Also contributing to the increased revenues is the sale of
approximately 82 acres of undeveloped land located in Sarasota, Florida
which was distributed to the Partnership by one of its joint ventures.
Land and property revenues for the three and six months ended June 30, 1994
consisted primarily of an approximate 3-acre undeveloped commercial parcel
in the Partnership's Weston Community, as well as an approximate 7-acre
undeveloped commercial parcel in Palm Beach County, Florida.

The increase in the gross operating profit margin from land and
property sales for the six months ended June 30, 1995 as compared to the
same periods in 1994 is due primarily to the low cost basis of the land and
property sales generated in the first quarter of 1995. The gross operating
profit margin from land and property sales decreased during the three
months ended June 30, 1995 as compared to the same period in 1994 due to
the recognition in 1994 of profits related to land sales which occurred in
previous years but had been deferred for financial reporting purposes as
well as the lower cost basis of the land parcels sold during the three
months ended June 30, 1994 as compared to the same period in 1995.

Operating properties represents activity from the Partnership's club
and hotel operations, commercial properties and certain other operating
assets. Revenues generated by the Partnership's operating properties
increased for the three and six months ended June 30, 1995 as compared to
the same periods in 1994 due primarily to increased membership activity at
the Partnership's club operations. Revenues also increased at the
Partnership's hotel operation in Boca Raton, Florida due to an increase in
the average daily room rates and occupancy. As a result of a corresponding
increase in cost of revenues relating to increased activity at the
Partnership's clubs and hotel, the gross operating margin from operating
properties remained relatively unchanged for the three and six months ended
June 30, 1995 as compared to the same period in 1994.

Brokerage and other operations represents activity from the sale of
unaffiliated third-party builders' homes within the Partnership's
Communities, activity from the resale of real estate inside and outside of
the Partnership's Communities, proceeds from the Partnership's property
management activities, as well as fees earned from various management
agreements with joint ventures. Revenues from brokerage and other
operations declined for the six month period ended June 30, 1995 as
compared to the same period in 1994 as a result of the decline in the
number of builder units closings at the Partnership's Broken Sound
Community, which is nearing close-out, as well as a decline in the number
of builder unit closings at the Partnership's Weston Community resulting
from management's decision to place more emphasis on the Partnership's home
building operations. This decline in activity at Broken Sound and Weston
also contributed to the decline in revenues from brokerage and other
operations for the three month period ended June 30, 1995 as compared to
the same period in 1994. A decline in revenues from resale operations at
Longboat Key, Florida also contributed to the unfavorable variance in
brokerage and other operations for the three months ended June 30, 1995 as
compared to the same period in 1994.

The gross operating profit margin from brokerage and other operations
declined for the six month period ended June 30, 1995 as compared to the
same period in 1994 primarily due to an adjustment recorded to cost of
revenues during the first quarter of 1995 to properly reflect commissions
paid in connection with the sales of builders' homes within the
Partnership's Communities which had closed prior to December 31, 1994.

Selling, general and administrative expenses include all marketing
costs, with the exception of those costs capitalized in conjunction with
the construction of housing units, and project and general administrative
costs. These expenses are net of the marketing fee reimbursements received
from third-party builders. The increase in selling, general and
administrative expenses for the three and six months ended June 30, 1995 as
compared to the same periods in 1994 is due primarily to an increase in
project administrative costs and marketing expenditures at certain of the
Partnership's communities, as well as an increase in the time spent on the
administration of the Partnership. The unfavorable variance also resulted
from lower marketing fees earned due to a decrease in the number of homes
closed by unaffiliated third-party builders within the Partnership's
Communities. This decrease is a direct result of the Partnership's
decision to place more emphasis on its homebuilding operations, as
discussed above.

Interest income increased for the three and six months ended June 30,
1995 as compared to the same periods in 1994 due to an increase in the
average amounts invested in 1995 in short-term financial instruments, as
well as an increase during 1995 in the interest rates earned on such
investments.

The increase in equity in earnings of unconsolidated ventures for the
six months ended June 30, 1995 as compared to the same period 1994 resulted
primarily from the recording of the Partnership's share of income generated
from a land sale by its commercial joint venture located in Ocala, Florida.

Interest and real estate taxes decreased for the three and six months
ended June 30, 1995 as compared to the same periods in 1994 due primarily
to a decrease in the average amount of borrowings outstanding during the
period, as well as an increase in the amount of real estate inventories
which meet the requirements for capitalization of these costs.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Several of these lawsuits alleged that the Partnership was liable,
among other reasons, as a result of its own alleged acts of misconduct or
as a result of the Partnership's assumption of Arvida Corporation's
liabilities in connection with the Partnership's purchase of Arvida
Corporation's assets from The Walt Disney Company ("Disney") in 1987, which
included certain assets related to the Country Walk development. Pursuant
to the agreement to purchase such assets, the Partnership obtained
indemnification by Disney for certain liabilities relating to facts or
circumstances arising or occurring prior to the closing of the
Partnership's purchase of the assets. Over 80% of the Arvida-built homes
in Country Walk were built prior to the Partnership's ownership of the
Community. Where appropriate, the Partnership has tendered or will tender
each of the above-described lawsuits to Disney for defense and
indemnification in whole or in part pursuant to the Partnership's
indemnification rights. Where appropriate, the Partnership has also
tendered these lawsuits to its various insurance carriers for defense and
coverage. The Partnership is unable to determine at this time to what
extent damages in these lawsuits, if any, against the Partnership, as well
as the Partnership's cost of investigating and defending the lawsuits, will
ultimately be recoverable by the Partnership either pursuant to its rights
of indemnification by Disney or under contracts of insurance.

On August 10, 1993, the Circuit Court of Dade County issued a final
order approving the terms of a class action settlement with opposing
counsel in one of the pending homeowners' lawsuits, which resolved
substantial portions of the pending homeowners' lawsuits that had been
filed. The settlement, which is designed to resolve claims arising in
connection with estate and patio homes and condominiums sold by the
Partnership after September 10, 1987, is structured to compensate residents
for losses not covered by insurance. Homeowners of approximately 85% of
the units in Country Walk have accepted the settlement. The Partnership
currently believes that the class action settlement may cost approximately
$2.5 million. The settlement is being funded by one of the Partnership's
insurers, subject to a reservation of rights. The amount of money, if any,
which the insurance company may recover from the Partnership pursuant to
its reservation of rights, is otherwise, is uncertain.

On February 24, 1994, the Partnership was dismissed from the pending
class action homeowner lawsuits pursuant to the class action settlement
discussed above. In addition, the Partnership has been informed that
Disney and an insurer have reached agreements to settle five of the
individual homeowner actions which were tendered by the Partnership to
Disney. These Disney settlements were funded without any contribution from
the Partnership.

Homeowners who affirmatively rejected the offer of settlement by
opting out were permitted to continue litigation against the Partnership.
The Partnership was and is party to a number of claims brought by
condominium and patio homeowners, all of whom have declined to accept the
terms of the class action settlement. Some of these actions by those
homeowners who have opted out of the settlement have been settled. The
aggregate amount of these settlements to date is approximately $414,000.
One of the Partnership's insurers has funded these settlements. The amount
of money that the insurance company may recover from the Partnership
pursuant to any reservation of rights, or otherwise, is uncertain.
Therefore, the accompanying Consolidated Financial Statements do not
reflect any accruals related to this matter. Currently, the Partnership is
involved in five lawsuits with homeowners who have opted out of the
original settlement which are pending in the Circuit Court of Dade County
and one claim that has not been filed as a lawsuit. Recently, the
Partnership has agreed in principle to resolve these remaining opt out
lawsuits. The settlement amounts necessary to resolve these matters is
expected to be approximately $106,000. The Partnership can give no
assurances that such settlement will in fact be consummated and the
accompanying consolidated financial statements do not reflect an accrual
for such costs.

As noted above, one of the Partnership's insurance carriers has been
funding settlements of various litigation related to Hurricane Andrew. In
some, but not all, instances, the insurance carrier has provided the
Partnership with written reservation of rights letters. The aggregate
amount of the settlements funded to date by this carrier is approximately
$8.0 million. The insurance carrier that funded these settlements pursuant
to certain reservations of rights has stated its position that it has done
so pursuant to various non-waiver agreement. The carrier's position was
that these non-waiver agreements permitted the carrier to fund settlements
without barring the carrier from raising insurance coverage issues or
waiving such coverage issues. On May 23, 1995, the insurance carrier
rescinded the various non-waiver agreements currently in effect regarding
the remainder of the Hurricane Andrew litigation, allegedly without waiving
any future coverage defenses, conditions, limitations, or rights. For this
and other reasons, the extent to which the insurance carrier may recover
any of these proceeds from the Partnership is uncertain. Therefore, the
accompanying Consolidated Financial Statements do not reflect any accruals
related to this matter.

Other than as described above, the Partnership is not subject to any
material pending legal proceedings, other than ordinary routine litigation
incidental to the business of the Partnership. Reference is made to Note 2
regarding certain other litigation involving the Partnership. Reference is
also made to Note 7 of Notes to Consolidated Financial Statements for a
discussion of certain claims by Merrill Lynch for indemnification by the
Partnership and the General Partner against losses and expenses that may be
suffered by Merrill Lynch relating to claims for arbitration asserted
against it by certain investors in the Partnership.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

3. Amended and Restated Agreement of Limited Partnership.*

4.0 Assignment Agreement by and among the General Partner, the
Initial Limited Partner and the Partnership.*

4.1 Amended and Restated Credit Agreement dated October 7, 1992,
among Arvida/JMB Partners, L.P., Arvida/JMB Partners, Southeast Florida
Holdings, Inc., Center Office Partners, Center Retail Partners, Center
Hotel Limited Partnership, Weston Hills Country Club Limited Partnership
and Chemical Bank and Nationsbank of Florida, N.A. is herein incorporated
by reference to Exhibit No. 4.4 to the Partnership's Report on Form 10-Q
(File number 0-16976) dated November 11, 1992.

4.2 Security Agreement dated as of October 7, 1992 made by
Arvida/JMB Partners, L.P., Arvida/JMB Partners, Southeast Florida Holdings,
Inc., Center Office Partners, Center Retail Partners, Center Hotel Limited
Partnership and Weston Hills Country Club Limited Partnership (as
"grantors") in favor of Chemical Bank and Nationsbank of Florida, N.A. (as
"lenders") is herein incorporated by reference to Exhibit No. 4.5 the
Partnership's Report on Form 10-Q (File number 0-16976) dated November 11,
1992.

4.3 Pledge Agreement dated as of October 7, 1992 among Arvida/JMB
Partners, L.P., Arvida/JMB Partners, Southeast Florida Holdings, Inc.,
Center Office Partners, Center Retail Partners, Center Hotel Limited
Partnership and Weston Hills Country Club Limited Partnership (as
"pledgors") and Chemical Bank and Nationsbank of Florida, N.A. (as
"lenders") is herein incorporated by reference to Exhibit No. 4.6 the
Partnership's Report on Form 10-Q (File number 0-16976) dated November 11,
1992.

4.4 Various mortgages and other security interests dated October
7, 1992 related to the assets of Arvida/JMB Partners, Center Office
Partners, Center Retail Partners, Center Hotel Limited Partnership, Weston
Hills Country Club Limited Partnership which secure loans under the Amended
and Restated Credit Agreement referred to in Exhibit 4.1 are herein
incorporated by reference to Exhibit No. 4.7 the Partnership's Report on
Form 10-Q (File number 0-16976) dated November 11, 1992.

4.7 $24,000,000 Consolidated Revolving Promissory Note dated
January 14, 1994 by and between Arvida Grand Bay Limited Partnership-I,
Arvida Grand Bay Limited Partnership-II, Arvida Grand Bay Limited
Partnership-III, Arvida Grand Bay Limited Partnership-IV, Arvida Grand Bay
Limited Partnership-V, and Arvida Grand Bay Limited Partnership-VI and
Barnett Bank of Broward County, N.A. is herein incorporated by reference to
the Partnership's report for December 31, 1993 on Form 10-K (File No. 0-
16976) dated March 25, 1994.

4.8 Amended and Restated Mortgage and Security Agreement dated
January 14, 1994 by and between Arvida Grand Bay Limited Partnership-I,
Arvida Grand Bay Limited Partnership-II, Arvida Grand Bay Limited
Partnership-III, Arvida Grand Bay Limited Partnership-IV, Arvida Grand Bay
Limited Partnership-V, Arvida Grand Bay Limited Partnership-VI and Arvida
Grand Bay Properties, Inc. and Barnett Bank of Broward County, N.A. is
herein incorporated by reference to the Partnership's report for December
31, 1993 on Form 10-K (File No. 0-16976) dated March 25, 1994.

4.9 Construction Loan Agreement dated January 14, 1994 by and
between Arvida Grand Bay Limited Partnership-I and Arvida Grand Bay
Properties, Inc. and Barnett Bank of Broward County, N.A. is herein
incorporated by reference to the Partnership's report for December 31, 1993
on Form 10-K (File No. 0-16976) dated March 25, 1994.

4.10. Second Amended and Restated Credit Agreement dated November
29, 1994, among Arvida/JMB Partners, L.P., Arvida/JMB Partners, Southeast
Florida Holdings, Inc., Center Office Partners, Center Retail Partners,
Center Hotel Limited Partnership, Weston Hills Country Club Limited
Partnership and Chemical Bank and Nationsbank of Florida, N.A. ***

4.11. Affirmation and Amendment of Security Documents dated November
29, 1994, among Arvida/JMB Partners, Arvida/JMB Partners, L.P., Southeast
Florida Holdings, Inc., Center Office Partners, Center Retail Partners,
Center Hotel Limited Partnership, Weston Hills Country Club Limited
Partnership and Chemical Bank. ***

4.12. Modification of Mortgage and Security Agreement and Other loan
Documents dated November 29, 1994, among Arvida/JMB Partners, Weston Hills
Country Club Limited Partnership and Chemical Bank. ***

4.13. Modification of First Mortgage and Security Agreement and
Other Loan Documents dated November 29, 1994, among Arvida/JMB Partners,
Center Office Partners, Center Retail Partners, Center Hotel Limited
Partnership and Chemical Bank. ***

4.14. Credit Agreement extension dated July 28, 1995 made by
Arvida/JMB Partners, L.P., Arvida/JMB Partners, Southeast Florida Holdings,
Inc., Center Office Partners, Center Retail Partners, Center Hotel Limited
Partnership, Weston Hills Country Club Limited Partnership and Chemical
Bank is filed herewith.

10.1. Agreement between the Partnership and The Walt Disney Company
dated January 29, 1987 is hereby incorporated by reference to Exhibit 10.2
to the Partnership's Registration Statement on Form S-1 (File No. 33-14091)
under the Securities Act of 1933 filed on May 7, 1987.

10.2. Management, Advisory and Supervisory Agreement is hereby
incorporated by reference to Exhibit 10.2 to the Partnership's report for
December 31, 1990 on Form 10-K (File No. 0-16976) dated March 27, 1991.

10.3. Letter Agreement, dated as of September 10, 1987, between the
Partnership and The Walt Disney Company, together with exhibits and related
documents.**

10.4. Joint Venture Agreement dated as of September 10, 1987, of
Arvida/JMB Partners, a Florida general partnership. **

10.5. Credit facility restructuring proposal between the Partnership
and Chemical Bank dated March 5, 1992 is hereby incorporated by reference
to Exhibit 10.5 to the Partnership's report for December 31, 1991 on Form
10-K (File No. 0-16976) filed on March 27, 1992.

27. Financial Data Schedule

* Previously filed with the Securities and Exchange
Commission as Exhibits 3. and 4.0, respectively, to the Partnership's Form
10-K Report (File No. 0-16976) filed on March 27, 1990 and incorporated
herein by reference.

** Previously filed with the Securities and Exchange
Commission as Exhibits 10.4 and 10.5, respectively, to the Partnership's
Registration Statement (as amended) on Form S-1 (File No. 33-14091) under
the Securities Act of 1933 filed on September 11, 1987 and incorporated
herein by reference.

*** Previously filed with the Securities and Exchange
Commission as Exhibits 4.10, 4.11, 4.12 and 4.13, respectively, to the
Partnership's Form 10-K Report (File No. 0-16976) filed on March 27, 1995
and hereby incorporated herein by reference.

(b) No reports on Form 8-K have been filed by the Partnership during
the period covered by this report.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

ARVIDA/JMB PARTNERS, L.P.

BY: Arvida/JMB Managers, Inc.
(The General Partner)

By: GAILEN J. HULL
Gailen J. Hull, Vice President
Date: August 9, 1995

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person in the capacity
and on the date indicated.

GAILEN J. HULL
Gailen J. Hull, Principal Accounting Officer
Date: August 9, 1995

July 14, 1995

VIA OVERNIGHT MAIL

Arvida/JMB Partners
Arvida/JMB Partners, L.P.
Southeast Florida Holdings, Inc.
Center Office Partners
Center Retail Partners
Center Hotel Limited Partnership
Weston Hills Country Club Limited Partnership
c/o Arvida/JMB Managers, Inc.
900 N. Michigan Avenue
Chicago, Illinois 60601

Attn: Stephen Lovelette

Re: LC Termination Date: Notices to Chemical Bank
----------------------------------------------

Gentlemen:

Reference is made to that certain Amended and Restated
Revolving Credit and Security Agreement dated as of October 7,
1992 among ARVIDA/JMB PARTNERS, L.P., a Delaware limited
partnership ("Arvida LP" or the "Partnership"), ARVIDA/JMB
--------- -----------
PARTNERS, a Florida general partnership ("ARVIDA GP"),
---------
SOUTHEAST FLORIDA HOLDINGS, INC., an Illinois corporation
("Southeast"), CENTER OFFICE PARTNERS, a Florida general
---------
partnership ("Office Partners"), CENTER RETAIL PARTNERS, a
---------------
Florida general partnership ("Retail Partners"), CENTER HOTEL
---------------
LIMITED PARTNERSHIP, a Delaware limited partnership ("Hotel
Partnership") and WESTON HILLS COUNTRY CLUB LIMITED
PARTNERSHIP, a Delaware limited partnership ("Weston
------
Partnership"; Weston Partnership, Arvida LP, Arvida GP,
----------
Southeast, Office Partners, Retail Partners and Hotel
Partnership being hereinafter collectively referred to as the
"Borrowers"), CHEMICAL BANK AND NATIONSBANK OF FLORIDA, N.A.
---------
(collectively, Lenders") and CHEMICAL BANK, As AGENT ("Agent")

------- -----
as heretofore amended (the "Credit Agreement"). Unless
----------------
otherwise defined herein, all capitalized terms shall have the
same meaning as in the Credit Agreement.<PAGE>
Arvida/JMB Partners, et.al.
July 14, 1994
Page 2

Chemical Bank, as the "LC Bank" under the Credit
Agreement, hereby gives notice to Borrowers of the extension
of the term of the LC Commitment, as well as the LC
Termination Date, to July 1, 1996.

This extension affects only the term of LC Commitment and does
not waive or modify any other term, provision or condition of
the Credit Agreement. Nor does it relate to any other
requests for waiver of, consent to, deviation from, or
extension of, the terms of the Credit Agreement, including
without limitation, any request by Borrowers for extension of
the Revolving Credit Loan Commitment Maturity Date or of the
I/P Loan Maturity Date.

Chemical Bank, as Agent, further advises Borrowers that
notwithstanding such extension Lenders reserve all rights and
remedies available to them for the full protection and
enforcement of their rights under the Credit Agreement and

July 14, 1994
Page 3

other loan documents and under applicable law. Furthermore,
nothing contained herein or therein shall constitute an
agreement by Lenders to continue discussion with Borrower
under any circumstances, to extend any Loan or Loan Commitment
made under the terms of the Credit Agreement, or to forbear
from exercising any of their rights or remedies under the
Credit Agreement, any other loan document or under applicable
law.

In addition, notice is hereby given that all future
communications to Chemical Bank, as Agent, Lender or LC Bank
pursuant to Section 9.1 or the Credit Agreement, should be
made to the following address:

Chemical Bank
380 Madison Avenue (10th Floor)
New York, NY 10017
Attn: Mary Elisabeth Swerz
Telecopy No.: (212) 622-3397

Copies should still be provided to Weil, Gotshall & Manges,
767 Fifth Avenue, New York, New York 10153, Attention of J.
Philip Rosen, Esq. (Telecopy No.: 212-310-8007).

Please countersign below to indicate your agreement with
the foregoing.

Sincerely,

CHEMICAL BANK

By: ----------------------
Mary Elisabeth Swerz
Vice President

cc: Lisa Crawford
H. William Walker, Esq.
Susan Werth, P.A.
Arvida/JMB Partners, et.al.

July 14, 1994
Page 4

Accepted and Agreed this 28th day of July, 1995
----

ARVIDA/JMB PARTNERS, L.P.

By: ARVIDA/JMB MANAGERS,
INC., as General Partner

By: ____________________
Title: V.P.

ARVIDA/JMB PARTNERS

By: ARVIDA/JMB MANAGERS,
INC., as General Partner

By: ____________________
Title: V.P.

SOUTHEAST FLORIDA HOLDINGS, INC.

By:_____________________
Title: V.P.

CENTER OFFICE PARTNERS

By: ARVIDA/JMB MANAGERS,
as General Partner

By: ARVIDA/JMB MANAGERS,
INC., as General Partner

By: ___________________
Title: V.P.

<ARTICLE> 5

<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1995 AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS INCLUDED IN SUCH
REPORT.
</LEGEND>

<CIK> 0000814046
<NAME> ARVIDA/JMB PARTNERS, L.P.

<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995

<CASH> 21,130,801
<SECURITIES> 0
<RECEIVABLES> 14,263,224
<ALLOWANCES> 210,943
<INVENTORY> 219,170,634
<CURRENT-ASSETS> 0
<PP&E> 69,875,613
<DEPRECIATION> 0
<TOTAL-ASSETS> 367,034,247
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 215,815,609
<TOTAL-LIABILITY-AND-EQUITY> 367,034,247
<SALES> 168,080,598
<TOTAL-REVENUES> 168,080,598
<CGS> 130,022,382
<TOTAL-COSTS> 130,022,382
<OTHER-EXPENSES> 14,762,055
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 24,987,008
<INCOME-TAX> 0
<INCOME-CONTINUING> 24,987,008
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,987,008
<EPS-PRIMARY> 60.62
<EPS-DILUTED> 60.62

</TABLE>