ARVIDA JMB PARTNERS L P, 10-Q, 1995-05-15

ARVIDA JMB PARTNERS L P
10-Q, 1995-05-15
LAND SUBDIVIDERS & DEVELOPERS (NO CEMETERIES)

Previous: ESSEF CORP, 10-Q, 1995-05-15

Next: TCF FINANCIAL CORP, 10-Q, 1995-05-15

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 March 31, 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. . . . . . . . . . . . . . . . . 31

Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations. . . . . . . . . . . . . . . . . . . . . . 25

PART II OTHER INFORMATION

Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . 31

Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . 34
<TABLE>
PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

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

CONSOLIDATED BALANCE SHEETS

MARCH 31, 1995 AND DECEMBER 31, 1994

(UNAUDITED)

ASSETS
------

<CAPTION>
MARCH 31, DECEMBER 31,
1995 1994
------------ -----------
<S> <C> <C>
Cash and cash equivalents (note 3) . . . . . . . . . . . . . . . . . . . . $ 3,323,666 22,024,390
Restricted cash (note 3) . . . . . . . . . . . . . . . . . . . . . . . . . 14,033,471 14,232,540
Trade and other accounts receivable (net of allowance for doubtful
accounts of $239,615 at March 31, 1995 and $229,542 at
December 31, 1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,279,864 18,209,957
Mortgages receivable, net. . . . . . . . . . . . . . . . . . . . . . . . . 1,010,451 1,094,223
Real estate inventories (note 2) . . . . . . . . . . . . . . . . . . . . . 218,221,596 207,874,438
Property and equipment, net. . . . . . . . . . . . . . . . . . . . . . . . 70,437,104 69,114,559
Investments in and advances to joint ventures, net . . . . . . . . . . . . 24,352,151 23,178,951
Equity memberships . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,257,479 10,536,864
Amounts due from affiliates (note 6) . . . . . . . . . . . . . . . . . . . 675,151 524,556
Prepaid expenses and other assets. . . . . . . . . . . . . . . . . . . . . 9,714,514 9,581,234
------------ ------------

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . $362,305,447 376,371,712
============ ============
ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES

CONSOLIDATED BALANCE SHEETS (CONTINUED)

(UNAUDITED)

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

MARCH 31, DECEMBER 31,
1995 1994
------------ -----------
Liabilities:
Bank overdrafts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,027,108 --
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,386,135 24,142,890
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,345,516 27,082,766
Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . 13,859,148 13,418,777
Notes and mortgages payable, net (note 4). . . . . . . . . . . . . . . . 92,679,077 115,147,525
------------ ------------
Commitments and contingencies (notes 1, 4, 5, 6, 7 and 8)

Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . 157,296,984 179,791,958
------------ ------------

Partners' capital accounts:
General Partner and Associate Limited Partners:
Capital contributions. . . . . . . . . . . . . . . . . . . . . . . . . 20,000 20,000
Cumulative net income. . . . . . . . . . . . . . . . . . . . . . . . . 34,718,155 34,328,454
Cumulative cash distributions. . . . . . . . . . . . . . . . . . . . . (33,912,035) (33,609,346)
------------ ------------
826,120 739,108
------------ ------------
Limited Partners:
Capital contributions, net of offering costs . . . . . . . . . . . . . 364,841,815 364,841,815
Cumulative net loss. . . . . . . . . . . . . . . . . . . . . . . . . . (18,564,700) (32,354,861)
Cumulative cash distributions. . . . . . . . . . . . . . . . . . . . . (142,094,772) (136,646,308)
------------ ------------
204,182,343 195,840,646
------------ ------------
Total partners' capital accounts . . . . . . . . . . . . . . . . 205,008,463 196,579,754
------------ ------------

Total liabilities and partners' capital. . . . . . . . . . . . . $362,305,447 376,371,712
============ ============
<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 MONTHS ENDED MARCH 31, 1995 AND 1994

(UNAUDITED)

<CAPTION>
1995 1994
------------ -----------
<S> <C> <C>
Revenues:
Housing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $44,609,088 31,907,079
Homesites. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,196,416 12,096,734
Land and property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,069,241 2,438,398
Operating properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,405,185 7,512,475
Brokerage and other operations . . . . . . . . . . . . . . . . . . . . . . . . 6,784,117 6,786,435
----------- ----------
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76,064,047 60,741,121
----------- ----------
Cost of revenues:
Housing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,640,076 24,986,943
Homesites. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,662,548 6,138,056
Land and property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,166,661 1,570,393
Operating properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,303,944 6,640,339
Brokerage and other operations . . . . . . . . . . . . . . . . . . . . . . . . 6,918,800 5,948,063
----------- ----------
Total cost of revenues . . . . . . . . . . . . . . . . . . . . . . . . . 56,692,029 45,283,794
----------- ----------
Gross operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,372,018 15,457,327
Selling, general and administrative
expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,461,414) (4,964,808)
----------- ----------
Net operating income . . . . . . . . . . . . . . . . . . . . . . . . . . 13,910,604 10,492,519

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

1995 1994
------------ -----------

Interest income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 322,243 107,145
Equity in earnings of unconsolidated ventures. . . . . . . . . . . . . . . . . . 1,114,062 53,191
Interest and real estate taxes, net. . . . . . . . . . . . . . . . . . . . . . . (1,167,047) (2,161,856)
----------- ----------
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $14,179,862 8,490,999
=========== ==========

Net income per Limited
Partnership Interest . . . . . . . . . . . . . . . . . . . . . . . . . $ 34.13 20.52
=========== ==========

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

THREE MONTHS ENDED MARCH 31, 1995 AND 1994

(UNAUDITED)

<CAPTION>
1995 1994
------------ -----------
<S> <C> <C>
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 14,179,862 8,490,999
Charges (credits) to net income not requiring (providing) cash:
Depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . . . 1,322,243 1,430,840
Equity in (earnings) losses of unconsolidated ventures . . . . . . . . . . . . (1,114,062) (53,191)
Provision for doubtful accounts. . . . . . . . . . . . . . . . . . . . . . . . 11,519 --
Loss on sale of property and equipment . . . . . . . . . . . . . . . . . . . . 11,809 32,968
Changes in:
Restricted cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199,069 (779,067)
Trade and other accounts receivable. . . . . . . . . . . . . . . . . . . . . . 7,918,572 3,591,786
Real estate inventories:
Additions to real estate inventories . . . . . . . . . . . . . . . . . . . . (49,376,902) (40,990,850)
Cost of sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,469,285 32,695,392
Capitalized interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,364,382) (1,970,221)
Capitalized real estate taxes. . . . . . . . . . . . . . . . . . . . . . . . (1,075,159) (925,811)
Equity memberships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 567,016 1,001,364
Amounts due from affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . (150,595) (42,410)
Prepaid expenses and other assets. . . . . . . . . . . . . . . . . . . . . . . (189,752) (447,058)
Accounts payable, accrued expenses and other liabilities . . . . . . . . . . . (4,642,030) 3,101,635
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 262,750 675,794
------------ -----------
Net cash provided by operating activities. . . . . . . . . . . . . . . 8,029,245 5,812,170
------------ -----------

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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83,772 649,339
Acquisitions of property and equipment . . . . . . . . . . . . . . . . . . . . (2,600,125) (1,459,912)
Proceeds from disposals of property and equipment. . . . . . . . . . . . . . . -- 2,074
Joint venture distributions (contributions), net . . . . . . . . . . . . . . . 91,730 272,473
Payments from (advances to) joint ventures . . . . . . . . . . . . . . . . . . (112,853) 175,862
------------ -----------
Net cash used in investing activities. . . . . . . . . . . . . . . . . (2,537,476) (360,164)
------------ -----------
Cash flows from financing activities:
Proceeds from notes and mortgages payable. . . . . . . . . . . . . . . . . . . 14,610,072 2,591,957
Payments of notes and mortgages payable. . . . . . . . . . . . . . . . . . . . (37,078,520) (16,632,642)
Distributions to General Partner and Associate Limited Partners. . . . . . . . (302,689) (142,523)
Distributions to Limited Partners. . . . . . . . . . . . . . . . . . . . . . . (5,448,464) (2,565,433)
Bank overdrafts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,027,108 --
------------ -----------
Net cash used in financing activities. . . . . . . . . . . . . . . . . (24,192,493) (16,748,641)
------------ -----------
Decrease in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . (18,700,724) (11,296,635)
Cash and cash equivalents, beginning of period . . . . . . . . . . . . . . . . . 22,024,390 18,906,679
------------ -----------
Cash and cash equivalents, end of period . . . . . . . . . . . . . . . . . . . . $ 3,323,666 7,610,044
============ ===========
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest, net of amounts capitalized. . . . . $ -- 1,451,118
============ ===========

<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

MARCH 31, 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 $2,372,800 and $2,835,600 was incurred for the three
months ended March 31, 1995 and 1994, respectively, of which approximately
$2,364,400 and $1,970,200 was capitalized, respectively. Interest
payments, including amounts capitalized, of approximately $2,328,700 and
$3,421,300 were made during the three months ended March 31, 1995 and 1994,
respectively.

Real estate taxes of $2,233,800 and $2,222,300 were incurred for the
three months ended March 31, 1995 and 1994, respectively, of which
approximately $1,075,200 and $925,800 were capitalized, respectively. Real
estate tax payments of approximately $96,700 and $79,700 were made during
the three months ended March 31, 1995 and 1994, respectively. The
preceding analysis of real estate taxes does not include real estate taxes
incurred or paid with respect to the Partnership'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 $1,265,800 and $1,244,000 was incurred for the three months
ended March 31, 1995 and 1994, respectively. Amortization of other assets,
excluding loan fees, of approximately $56,500 was incurred for each of the
three months ended March 31, 1995 and 1994. Amortization of loan fees,
which is included in interest expense, of approximately $129,400 and
$131,900 was incurred for the three months ended March 31, 1995 and 1994,
respectively.

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.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

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 three months ended March 31:

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

Net income . . . . .$14,179,862 12,083,283 8,490,999 9,767,077
Net income per
Limited
Partnership
Interest. . . . . .$ 34.13 29.00 20.52 23.64
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.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

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 three months ended March 31, 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 cable television businesses serving certain of its Communities.

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.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

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 March 31, 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 $1,745,700 and
$1,777,000 at March 31, 1995 and December 31, 1994, respectively. The
decrease in cash and cash equivalents at March 31, 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 March 31, 1995, the Partnership's credit facility consists of a
term loan in the original amount of $85,252,250, 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
mortgages on a mixed-use center and an office building in Boca Raton,
Florida. All of the notes under the facility are cross-collateralized and
cross-defaulted. At March 31, 1995, the term loan, the revolving line of
credit and the income property term 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 three month period ended March 31, 1995, the effective
interest rate for the combined term loan, income property term loan and
revolving line of credit facility was approximately 9.2% per annum.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

million are required to be paid monthly until March 1996 when the remaining
outstanding principal balance will be due. The revolving line of credit
and letter of credit facility mature in December 1995 and July 1995,
respectively. At March 31, 1995, all of the term loan proceeds had been
borrowed with a remaining balance of $50,812,363. The balances outstanding
on the revolving line of credit facility, the income property term loan and
the letter of credit facility at March 31, 1995 are $8,000,000, $17,633,326
and $9,497,064, respectively.

The Partnership has a contract for the sale of its office building
located in downtown Boca Raton, Florida known as Mizner Place for
approximately $4 million. The sale is expected to close during the second
quarter of 1995. The net sales proceeds from such sale will be 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 March 31, 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 $2.0 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 the first two buildings and
certain amenities within the Partnership's condominium project on Longboat
Key, Florida know as Arvida's Grand Bay. This line of credit bears interest
at the lender's prime rate (9% at March 31, 1995) plus 3/4% per annum and
matures in January 1996. At March 31, 1995, approximately $1.5 million was
outstanding under this note. The Partnership currently anticipates that
this amount will be repaid from the proceeds from the sale of condominium
units within the first two buildings. The receipt of sales proceeds from
units sold within the first building prior to December 31, 1994 which
closed during the first quarter of 1995 are the primary cause of the
decrease in trade and other accounts receivable at March 31, 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.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(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 three months ended March 31, 1995, the Partnership advanced
approximately $159,500 to certain of the joint ventures in which it holds
interests. The total of such advances outstanding were approximately $4.2
and $4.1 million at March 31, 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 May 10, 1995, approximately $86,400 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.

(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 three months ended
March 31, 1995 was approximately $55,500 all of which was paid as of March
31, 1995. The total of such costs for the three months ended March 31,
1994 was approximately $27,000. In addition, the General Partner and its
affiliates are entitled to reimbursements for salaries and salary-related
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 March 31,
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 three months ended March 31, 1995, the amount
of such costs incurred by the Partnership on behalf of these affiliates
totalled approximately $231,000. At March 31, 1995, approximately $218,900
was owed to the Partnership, of which approximately $38,700 was received as
of May 10, 1995. For the three month period ended March 31, 1994, the
Partnership was entitled to reimbursements of approximately $115,000.

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 three
month periods ended March 31, 1995 and 1994, the Partnership was entitled

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

to receive approximately $379,800 and $483,900, respectively, from
Arvida/JMB Partners, L.P.-II. At March 31, 1995, approximately $155,100
was owed to the Partnership, all of which was received as of May 10, 1995.
In addition, for the three month periods ended March 31, 1995 and 1994, the
Partnership was obligated to reimburse Arvida/JMB Partners, L.P.-II
approximately $88,400 and $104,400, respectively. At March 31, 1995,
approximately $62,200 was unpaid, all of which was paid as of May 10, 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 three month periods ended March 31, 1995 and 1994 were
approximately $2,684,000 and $3,118,000, respectively, all of which was
paid as of March 31, 1995.

The Partnership pays for certain general and administrative costs on
behalf of its clubs, homeowners associations and maintenance associations.
The Partnership receives reimbursements from these entities for such costs.

For the three month period ended March 31, 1995, the Partnership was
entitled to receive approximately $124,500 from these entities. At March
31, 1995, approximately $53,900 was owed to the Partnership. As of May 10,
1995, approximately $10,200 had been received. For the three months ended
March 31, 1994, the Partnership was entitled to receive approximately
$113,000 from these entities.

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 March 31, 1995, the
Partnership owed approximately $189,600 to one of its clubs for such
funding, all of which was paid as of May 10, 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 three months ended March 31, 1995. At March 31, 1995,
approximately $499,200 was owed to the Partnership, which includes amounts
owed from the previous year, none of which was received as of May 10, 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 $9,497,000 and $7,589,000,
respectively, at March 31, 1995. At December 31, 1994, the Partnership was
contingently liable under standby letters of credit and performance bonds
for approximately $10,170,000 and $7,589,000, respectively. In addition,

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

certain joint ventures in which the Partnership holds an interest are also
contingently liable under bonds for approximately $1,020,000 at March 31,
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
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 uncertain. Due to this uncertainty, 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

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. The Partnership
intends to vigorously defend itself in these matters.

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.

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.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

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.

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 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 in principle 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 amount of the proposed settlement is not
expected to be material. There is no assurance that this settlement in
principle will in fact be consummated.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

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.

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 March
31, 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 is 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

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

scope of the development 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 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 1,156 of the 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 includes proposed wetlands mitigation of 1,319 acres together
with construction of schools, parks, roads, sewers and related
infrastructure, in addition to residential and commercial development.
However, in August 1994, the Environmental Protection Agency (the "EPA")
issued a letter to the United States Army Corps of Engineers (the "Corps"),
which is the governmental agency responsible for issuing permits involving
development of wetlands areas, setting forth the EPA's position that no
more than 120 gross acres in Increment III should be permitted to be
developed. In addition, the EPA recommended that adequate compensatory
mitigation be implemented in connection with such development.

The Partnership believes, based on scientific evidence, that the EPA's
recommendation is flawed and it continues to pursue issuance of the permit
for development of Increment III on the terms and conditions previously set
forth in its application. The Corps has not accepted the recommendation of
the EPA and has advised the Partnership that it is continuing to consider
the Partnership's current application as presently submitted. During
October 1994, the Corps performed an independent analysis of the wetlands
impact and mitigation. To date, the Partnership has not received a formal
response from the Corps regarding the results of this analysis. However,
an informal response has been received requesting additional and clarified
information regarding certain characteristics of the proposed mitigation
plan, which the Partnership has provided.

If the Corps ultimately issues a permit generally on the same terms
and conditions as set forth in the Partnership's previously submitted
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. 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
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%.
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 March 31, 1995, the
amount of bonds issued and outstanding totalled $98,575,000.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(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 three months ended March 31, 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
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

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED

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
March 31, 1995 and December 31, 1994 and for the three month periods ended
March 31, 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 March 31, 1995 and December 31, 1994, the Partnership had cash and
cash equivalents of approximately $3,324,000 and $22,024,000, respectively.

The decrease in cash and cash equivalents at March 31, 1995 as compared to
December 31, 1994 is due primarily to debt service payments as well as
distributions to partners made in February 1995, as further discussed
below. Bank overdrafts, which represent checks in transit, of
approximately $4,027,000 at March 31, 1995 were repaid in April 1995.
Remaining cash and cash equivalents were available for debt service,
working capital requirements and distributions to partners. 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.

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 income and cash flow in
excess of scheduled debt service during 1995.

At March 31, 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 mortgages on a mixed-use center and an office building in
Boca Raton, Florida. 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. 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 three months ended March 31,
1995, the Partnership made such additional term loan payments totalling
approximately $12.6 million. Principal repayments of $5 million, $10
million and $5 million on the term loan are due in July 1995, 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
and letter of credit facility mature in December 1995 and July 1995,
respectively. At March 31, 1995, all of the term loan proceeds had been
borrowed with a remaining balance of $50,812,363. The balances outstanding
on the revolving line of credit facility, the income property term loan and
the letter of credit facility at March 31, 1995 are $8,000,000, $17,633,326
and $9,497,046, 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 lender 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
lender.

The Partnership has a $28.9 million revolving construction line of
credit for the first two buildings and certain amenities within the
Partnership's condominium project on Longboat Key, Florida known as
Arvida's Grand Bay. This line of credit bears interest at the lender's
prime rate (9% at March 31, 1995) plus 3/4% per annum and matures in
January 1996. At March 31, 1995, approximately $1.5 million was
outstanding under this note. The Partnership currently anticipates that
this amount will be repaid from the proceeds from the sale of condominium
units within the first two buildings. The receipt of sales proceeds from
units sold within the first building prior to December 31, 1994 which
closed during the first quarter of 1995 are the primary cause of the
decrease in trade and other accounts receivable at March 31, 1995 as
compared to December 31, 1994.

The Partnership is seeking a permit to develop 1,156 of the 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 includes proposed wetlands mitigation of 1,319 acres together
with construction of schools, parks, roads, sewers and related
infrastructure, in addition to residential and commercial development.
However, in August 1994, the Environmental Protection Agency (the "EPA")
issued a letter to the United States Army Corps of Engineers (the "Corps"),
which is the governmental agency responsible for issuing permits involving
development of wetlands areas, setting forth the EPA's position that no
more than 120 gross acres of Increment III should be permitted to be
developed. In addition, the EPA recommended that adequate compensatory
mitigation be implemented in connection with such development.

The Partnership believes, based on scientific evidence, that the EPA's
recommendation is flawed and it continues to pursue issuance of the permit
for development of Increment III on the terms and conditions previously set
forth in its application. The Corps has not accepted the recommendation of
the EPA and has advised the Partnership that it is continuing to consider
the Partnership's current application as presently submitted. During
October 1994, the Corps performed an independent analysis of the wetlands
impact and mitigation. To date, the Partnership has not received a formal
response from the Corps regarding the results of this analysis. However,
an informal response has been received requesting additional and clarified
information regarding certain characteristics of the mitigation plan which
the Partnership has provided.

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
2generally 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 months ended March 31, 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 March 31, 1995, the Partnership (including its
consolidated joint ventures) closed on the sale of 283 housing units, 68
homesites, approximately 22 acres of undeveloped land tracts, as well as
the sale of the Partnership's cable television operation in its Broken
Sound Community. This compares to closings in the first quarter of 1994 of
154 housing units, 150 homesites and approximately three acres of
developed and undeveloped land tracts. Outstanding contracts ("backlog")
as of March 31, 1995 were for 981 housing units, 104 homesites,
approximately 50 acres of developed and undeveloped land tracts as well as
an office building located in downtown Boca Raton, Florida known as Mizner
Place. This compares to a backlog as of March 31, 1994 of 576 housing
units, 114 homesites and approximately 38 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.

The increase in housing revenues for the three months ended March 31,
1995 as compared to the same period in 1994 is attributable primarily to
management's decision to place more emphasis on the Partnership's home
building operations. This decision has resulted in more housing products
being built by the Partnership, in lieu of the Partnership selling
homesites to unaffiliated third-party builders. As a result, unit closings
and revenues increased significantly for the first quarter of 1995 as
compared to 1994 at the Partnership's Weston Community. Closings also
increased at the Partnership's Communities in Tampa and Jacksonville,
Florida. In addition, the Partnership commenced home building activities
in the Atlanta market with the introduction of housing products in its
Water's Edge and Dockside Communities. The Partnership generated the
initial revenues from the closings of these homes in the first quarter of
1995. Also contributing to the favorable revenue variance for 1995 as
compared to 1994 was the recognition of revenues under the percentage of
completion method for the first building at Arvida's Grand Bay on Longboat
Key. The Partnership recognized the initial revenues for this project in
May 1994. The favorable variances in housing revenues were partially
offset by decreased closings at the Partnership's Broken Sound Community as
this Community is nearing close-out. Due to the anticipated close-out of
the Partnership's higher profit margin products within Broken Sound in
1995, future gross operating profit margins from housing activities are not
expected to be as high as recent years' margins.

The decrease in homesite revenues for the three months ended March 31,
1995 as compared to the same period in 1994 is due primarily to fewer lot
closings in the Partnership's Weston Community, as well as its Communities
in Tampa 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, as discussed above.

The decrease in the gross operating profit margin from homesite
activities for the three months ended March 31, 1995 as compared to the
same period in 1994 is due primarily to certain adjustments made to 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 months ended
March 31, 1995 as compared to the same period in 1994 is due to the
closings in the first quarter of 1995 of approximately 22.3 acres of
undeveloped commercial land parcels in Palm Beach County, Florida, as well
as the closing of the Partnership's cable operation in its Broken Sound
Community. Land and property revenues for the three months ended March 31,
1994 included the sale of an approximate 3-acre undeveloped commercial
parcel in the Partnership's Weston Community.

The increase in the gross operating profit margin from land and
property sales for the three months ended March 31, 1995 as compared to the
same period in 1994 is due primarily to the low cost basis of the land and
property sales generated in the first quarter of 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 months ended March 31, 1995 as compared to the same
period in 1994 due primarily to increased membership activity and green
fees at the Partnership's club operations in Weston. Revenues also
increased at the Partnership's hotel operation in Boca Raton, Florida due
to an increase in the average daily room rates.

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. The decline in the gross operating profit
margin from brokerage operations for the three months ended March 31, 1995
as compared to the same period in 1994 is primarily due to an adjustment
recorded to cost of sales to properly reflect commissions paid in
connection with the sales of builders' homes within the Partnership's
Communities which had closed prior to year-end.

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 months ended March 31, 1995 as
compared to the same period in 1994 is due primarily to an increase in
project administrative costs resulting from increased construction activity
at Weston and Arvida's Grand Bay. 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. Despite the increase in the amount of selling, general
and administrative expenses incurred, such costs decreased as a percentage
of revenues and gross operating profit for the three months ended March 31,
1995 as compared to the same period in 1994. This decrease in these
expenses as they relate to revenues and profits results in a favorable
impact on the Partnership's net income for the period.

Interest income increased for the three months ended March 31, 1995 as
compared to the same period in 1994 due to an increase in the average
amounts invested in 1995 in short-term financial instruments, as well as an
increase in the interest rates earned on such investments.

The increase in equity in earnings of unconsolidated ventures for the
three months ended March 31, 1995 as compared to 1994 resulted from the
recording of the Partnership's share of income generated from a land sale
by the commercial joint venture located in Ocala, Florida.

Interest and real estate taxes decreased for the three months ended
March 31, 1995 as compared to the same period 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.

2
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 uncertain.

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. The Partnership
intends to vigorously defend itself in these matters.

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.

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 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. ***

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 quarter 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: May 11, 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: May 11, 1995

<ARTICLE> 5

<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 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> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995

<CASH> 17,357,137
<SECURITIES> 0
<RECEIVABLES> 11,529,930
<ALLOWANCES> (239,615)
<INVENTORY> 218,221,596
<CURRENT-ASSETS> 0
<PP&E> 70,437,104
<DEPRECIATION> 0
<TOTAL-ASSETS> 362,305,447
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 205,008,463
<TOTAL-LIABILITY-AND-EQUITY> 362,305,447
<SALES> 76,064,047
<TOTAL-REVENUES> 76,064,047
<CGS> 56,692,029
<TOTAL-COSTS> 56,692,029
<OTHER-EXPENSES> 6,628,461
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 14,179,862
<INCOME-TAX> 0
<INCOME-CONTINUING> 14,179,862
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 14,179,862
<EPS-PRIMARY> 0
<EPS-DILUTED> 0

</TABLE>