AMLI RESIDENTIAL PROPERTIES TRUST, 10-K/A, 1996-05-16

AMLI RESIDENTIAL PROPERTIES TRUST
10-K/A, 1996-05-16
OPERATORS OF NONRESIDENTIAL BUILDINGS

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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10K/A

AMENDMENT NO. 1

Filed pursuant to Section 12, 13, or 15(d) of the
Securities Exchange Act of 1934

AMLI RESIDENTIAL PROPERTIES TRUST
-----------------------------------------------------
(Exact name of registrant as specified in its charter)

IRS Employer Identification

Commission File No. 1-12784 No. 36-3925916

The undersigned registrant hereby amends the following sections of its
Report for December 31, 1995 on Form 10-K as set forth in the pages
attached hereto:

PART II

Item 5. Market for Registrant's Common Equity
and Shareholder Matters
Item 6. Selected Financial Data
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Item 8. Financial Statements and Supplementary Data
Item 9. Changes in and Disagreements with
Accountants on Accounting and
Financial Disclosure

Pages [ 16 ] to [ 61 ]

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

AMLI RESIDENTIAL PROPERTIES TRUST

By: ALLAN J. SWEET
Allan J. Sweet
President and Trustee

<TABLE>

PART II

Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND SHAREHOLDER MATTERS

The Company's common shares began trading on the NYSE on February 9, 1994, under the symbol "AML." The following
table sets forth the quarterly high and low sales prices per share as reported on the New York Stock Exchange
Composite Tape by CompuServe and the dividends paid by the Company with respect to the period noted.

1995 1994
----------------------------- -----------------------------
DIVIDENDS DIVIDENDS
HIGH LOW PER SHARE HIGH LOW PER SHARE
------ ---- --------- ------ ------ ---------
<S> <C> <C> <C> <C> <C> <C>

First Quarter . $19-3/4 $17 $.43(1) $23-1/4 $20-1/8 $.21(2)
Second Quarter. 20-1/2 17-5/8 .43(1) 22-7/8 19-3/4 .42(3)
Third Quarter . 20-1/8 18-1/4 .43(1) 22-3/8 20-1/8 .42(3)
Fourth Quarter. 20-3/8 18-3/8 .43(1) 21-1/4 17 .42(3)

<FN>
(1) The Company paid dividends with respect to these quarters on May 22, 1995, August 21, 1995, November 20,
1995 and February 20, 1996.

(2) On May 22, 1994, the Company paid a dividend of $.21 per common share to holders of record on May 12,
1994, representing a pro rata dividend for the period February 15, 1994 (the date on which the Initial Offering
was completed) through March 31, 1994, based on a $.42 quarterly dividend rate.

(3) The Company paid dividends with respect to these quarters on August 22, 1994, November 21, 1994 and
February 20, 1995.

Dividends are declared and paid in the second month following the end of the calendar quarter in which the related
cash flow from operations is generated. On February 29, 1996, the last reported sale price of the common shares
on the NYSE was $20.25 per share. On the same date, the Company had 11,682,790 common shares outstanding held by
169 shareholders of record.

The Company's current dividend payment level equals an annual rate of $1.72 per common share based on 11,634,776
weighted average of shares outstanding during 1995. The Company anticipates that it will continue to make regular
quarterly dividend payments. Approximately 35% of dividends paid during 1995 represented a return of capital, and
the Company estimates that approximately 35% of the total dividends to be paid in 1996 will be treated as a return
of capital.

</TABLE>

Future distributions by the Company will be at the discretion of the Board of
Trustees and will depend on the actual cash available for distribution and
funds from operations of the Company, its financial condition, capital
requirements, the annual distribution requirements under the REIT provisions
of the Code and such other factors as the Board of Trustees deems relevant.
The annual dividend payments for calendar year 1995 necessary for the
Company to maintain its status as a REIT was approximately $.67 per share.
<TABLE>
ITEM 6. SELECTED FINANCIAL DATA

<CAPTION>
HISTORICAL
-------------------------------------------------------------------------
1995 1994 1993 1992 1991
------------- ------------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
OPERATING DATA:
Revenue . . . . . . . . . $73,877 65,215 48,534 39,280 35,314
Income (loss) before
minority interest and
extraordinary items. . . 17,006 13,398 (1,695) (3,304) (6,841)
Net income (loss) . . . . 13,719 8,710 (1,695) (1,534) (6,624)

Net income per common
share. . . . . . . . . . 1.18 .75(A) N/A N/A N/A

BALANCE SHEET DATA:

Residential real estate,
before accumulated
depreciation . . . . . . $442,865 451,762 338,895 263,877 227,372
Total assets. . . . . . . 433,227 442,619 311,236 242,680 211,444
Total debt. . . . . . . . 215,255 217,687 263,021 202,360 180,673
Minority interest . . . . 39,077 42,743 - - -
Shareholders'/partners'
equity . . . . . . . . . 166,163 170,161 39,157 33,340 24,566

OTHER DATA:

Funds from operations (B) 27,404 22,033(A) 8,021 4,744 1,453
Cash dividends paid per
common share . . . . . . 1.71 1.05(A) N/A N/A N/A
Net cash flow from
operating activities . . 29,152 27,510 10,594 5,195 2,507
Net cash flow for
investing activities . . (3,369) (143,999) (71,796) (29,838) (22,048)
Net cash flow from (for)
financing activities . . (26,964) 110,326 64,951 26,902 18,530
<FN>

(A) The information presented is for the ten and one-half month period ended December 31,
1994 based on shares and units outstanding during the period.
</TABLE>

(B) Industry analysts generally consider funds from operations to be an
appropriate measure of the performance of an equity REIT. The Company is
of the of the opinion that the supplementary disclosure of funds from
operations provides an alternative measure of performance which may be
useful to the reader. Funds from operations is defined as net income
(computed in accordance with generally accepted accounting principles),
excluding gains (losses) from debt restructuring and sales of property,
plus depreciation and amortization, and after adjustments for
unconsolidated partnerships and joint ventures. Adjustments for
unconsolidated partnerships and joint ventures are calculated to reflect
funds from operations on the same basis. Funds from operations does not
represent cash flows from operations as defined by generally accepted
accounting principles ("GAAP"), is not indicative that cash flows are
adequate to fund all cash needs and is not to be considered an alternative
to net income or any other GAAP measure as a measurement of the results of
the Company's operations or the Company's cash flows or liquidity as
defined by generally accepted accounting principles.

As of December 31, 1994, the Company adopted NAREIT's new definition
of funds from operations, which definition does not provide for adding back
depreciation on non-property related personal property or the amortization
of deferred financing costs to net income. Funds from operations for the
year ended December 31, 1995 and the ten and one-half month period ended
December 31, 1994 is summarized as follows:

1995 1994
---- ----

Income before minority
interest and
extraordinary item $17,006 13,354
Depreciation 10,785 9,231
Other, net (387) (552)
------- ------
Funds from operations $27,404 22,033
======= ======

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND
RENTAL RATES PER UNIT)

This information should be read in conjunction with the accompanying
consolidated and combined financial statements and notes thereto. The
following discussion is based primarily on the consolidated financial
statements of Amli Residential Properties Trust and Amli Residential
Properties Limited Partnership (the "Company"), which reflect the
completion of the Initial Public Offering ("Initial Offering") and Amli
Residential Properties Group ("ARPG" or the "Predecessor"), which reflect
the historical combined financial statements of ARPG prior to the
completion of the Initial Offering.

The combined financial statements of ARPG combine the balance sheet data
and results of operations of various limited partnerships ("Property
Partnerships") sponsored by Amli Realty Co. ("Amli"), which prior to the
formation of the Company, owned twenty residential properties, held general
partner interests in three additional limited partnerships sponsored by
Amli ("GP Properties") and owned the property management, landscaping,
investment advisory and asset management businesses conducted by
subsidiaries and divisions of Amli (the "Service Companies") which were
contributed to the Company. ARPG is the predecessor entity to the Company
and the combined financial statements are presented for comparative
purposes. The following discussion compares the activities for the year
ended December 31, 1995 to December 31, 1994, which includes the summation
of the Company's and ARPG's results of operations.

As a result of the successful completion of the Initial Offering in
February 1994, the Company issued 10,235,000 common shares to the public
and 122,500 additional common shares to Amli and certain officers and
trustees of the Company through a concurrent private placement of shares.
The common shares were sold at a price of $20.50 per share. Net of
offering costs and expenses, and including the concurrent private placement
and the proceeds from the Underwriters' exercise of their option to acquire
additional shares to cover over-allotments, net equity proceeds totalled
$195,206.

As of December 31, 1995, the Company owns an 81% general partnership
interest (82% as of February 29, 1996) in the Operating Partnership, which
holds the operating assets of the Company, primarily the 25 residential
properties (the "Properties") and partnership interests in the co-
investment properties. The limited partners, which consist of Amli and the
Original Investors in the Property Partnerships, hold Operating Partnership
units ("OP Units") which are convertible into shares of the Company on a
one-for-one basis, subject to certain limitations. During 1995, a total of
151,289 OP Units were converted to shares, so that at December 31, 1995 the
Company owns 11,681,659 OP Units of the total of 14,426,710. The Company
has qualified, and anticipates continuing to qualify, as a real estate
investment trust ("REIT") for Federal income tax purposes.

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 1995 the Company had $2,829 in cash and cash equivalents,
of which $550 was restricted.

At December 31, 1995 the Company had outstanding borrowings of $32,535 on a
$50,000 line of credit from Wachovia Bank secured by mortgages on two
properties in Georgia, AMLI at Sope Creek (including the recently completed
232-unit Phase IV) and AMLI at Vinings. Of the total outstanding, the rate
on $12,400 has been fixed at 6.47% until February 15, 1997 and the rate on
$14,000 has been fixed at 6.65% until February 24, 1997 through use of
interest rate swap contracts. In addition, $5,845 has an interest rate cap
contract in place as protection against increases in LIBOR rates above
3.875% through February 15, 1998. On January 30, 1996, the Company paid
down the portion of the loan relating to Phase IV of AMLI at Sope Creek by
$8,775 from proceeds of the preferred shares offering. On February 26,
1996, $6,000 was re-borrowed to fund the acquisition of two land parcels in
Aurora, Illinois and Atlanta, Georgia. The remaining credit availability
of $20,240 is anticipated to be used to fund future acquisition or
development activities.

At December 31, 1995 the Company had outstanding borrowings of $16,000
against the Lehman Line of Credit commitment of $39,628. On January 30,
1996, the Company paid down this line of credit by $10,000 of which $8,000
was from proceeds of the preferred shares offering. The remaining credit
availability of $33,628 is anticipated to be used to fund future
development and acquisition activities and working capital needs.

In April 1995, the Company closed on a $27,000 revolving credit and
construction loan facility with Citicorp Real Estate, Inc. Loans made
pursuant to this credit facility are secured by a first mortgage on the
Company's existing AMLI at Autumn Chase and AMLI at Chase Oaks properties
and mortgages on the land on which second phases of AMLI at Autumn Chase
and AMLI at Gleneagles are being built. At December 31, 1995 the Company
has outstanding borrowings of $2,343 against this commitment. Of the total
credit facility, approximately $21,200 is being used to fund development
costs (excluding land costs previously incurred) of the 224-unit AMLI at
Autumn Chase Phase II and the 264-unit AMLI at Gleneagles Phase II, both
developments located in Dallas, Texas. The balance of the loan facility
will be available for other development or acquisition activities of the
Company, or for working capital requirements.

On August 7, 1995, the Company closed on a $20,100 loan provided by
Teachers Insurance and Annuity Association. The loan is for a term of ten
years and is secured by a first mortgage on AMLI at Regents Center in
Overland Park, Kansas. At the Company's option, the loan is convertible to
an unsecured obligation of the Company upon receipt of at least a BBB
credit rating. The first disbursement of $13,800 was funded on the closing
date and bears an 8.73% interest rate. The proceeds were used to pay down
the Lehman Line of Credit. The remaining commitment will bear interest at
9.23% and is anticipated to fund in 1996 upon substantial completion of the
additional 124-unit Phase III under construction at this property. The
proceeds are anticipated to be used to repay the $6,230 Harris Trust and
Savings Bank construction loan.

On August 11, 1995, the Company closed the sale of the 421-unit Club Laguna
located in Orange County, California. The sale price of $29,908 was paid
in cash, and the net proceeds were used in part to pay down the Lehman Line
of Credit.

On October 24, 1995, the Company closed on a $6,230 construction loan from
Harris Trust and Savings Bank for AMLI at Regents Center Phase III. The
loan, which is unsecured with respect to the property under construction,
bears LIBOR + 2.00% floating interest rate and will mature on October 9,
1996.

Net cash flow provided by operating activities was $29,152 for the year
ended December 31, 1995 and $27,510 for the year ended December 31, 1994,
an increase of $1,642. The increase was primarily attributable to the
$8,677 increase in property revenues less the $3,998 increase in property
operating expenses, $1,369 increase in interest expense and $680 of 1995
expenses relating to the AMLI brand name.

Cash flows used in investing activities for the year ended December 31,
1995 of $3,369 consisted primarily of expenditures for the acquisition of
four land parcels in Atlanta, Dallas and Eastern Kansas, development costs,
and contributions to co-investment partnerships, all net of cash proceeds
of $29,583 from the sale of Club Laguna. Cash flows used in investing
activities for the year ended December 31, 1994 was $143,999 (of which
$29,327 was for the acquisition of the 424-unit AMLI on the Green apartment
community in Fort Worth and the 250-unit AMLI at Chase Oaks apartment
community in Dallas; $4,077 was used for the acquisition of two land
parcels located in Dallas and Austin; and $64,282 was used to purchase the
interests of certain partners of the Original Investors). A total of
$1,714 and $2,887 was spent on improvements to existing properties for the
year ended December 31, 1995 and 1994, respectively.

Net cash flows used in financing activities was $26,964 for the year ended
December 31, 1995 and net cash flows provided by financing activities was
$110,326 for the year ended December 31, 1994. In 1995, net cash flows
used in financing activities relate primarily to payments of dividends and
cash distributions and repayments of the Lehman Line of Credit. In 1994,
the significant activities were the effect of the formation transactions
relating to the Initial Offering, including receipt of the net proceeds of
such Initial Offering and effecting a net reduction in debt.

Funds from operations is defined as net income (computed in accordance with
generally accepted accounting principles), excluding gains (losses) from
debt restructuring and sales of property, plus depreciation and
amortization, and after adjustments for unconsolidated partnerships and
joint ventures. Adjustments for unconsolidated partnerships and joint
ventures are calculated to reflect funds from operations on the same basis.

Funds from operations is widely accepted in measuring the performance of
equity REITs. An understanding of the Company's funds from operations will
enhance the reader's comprehension of the Company's results of operations
and cash flows as presented in the financial statements and data included
elsewhere herein. Funds from operations should not be considered an
alternative to net income or any other GAAP measurement as a measure of the
results of the Company's operations, the Company's cash flows or liquidity.

Funds from operations for the year ended December 31, 1995 and for the
period from February 15 to December 31, 1994 are summarized as follows:

1995 1994
------- -------
Net income before minority interest
and extraordinary item . . . . . . . $17,006 13,354
Depreciation. . . . . . . . . . . . . 10,785 9,231
Other, net (1). . . . . . . . . . . . (387) (552)
------- ------
Funds from operations . . . . . . . . $27,404 22,033
======= ======

Total shares and units. . . . . . . . 14,427 14,427
======= =======

(1) Includes share of co-investment partnerships' depreciation, and in 1995
gain on sale of residential property net of non-recurring expenses
associated with the AMLI brand name, and in 1994 gain resulting from
interest rate cap contracts.

The Company expects to pay quarterly dividends from cash available for
distribution. Until distributed, funds available for distribution will be
invested in short-term investment grade securities or used to temporarily
reduce outstanding balances on the Company's revolving lines of credit.

The Company expects to meet its short-term liquidity requirements by using
its working capital and any portion of net cash flow from operations not
distributed currently. The Company is of the opinion that its future net
cash flows will be adequate to meet operating requirements in both the
short and the long term and provide for payment of dividends by the Company
in accordance with REIT requirements. In order to qualify as a REIT, the
Company is required to distribute dividends to its shareholders equal to
95% of its REIT taxable income. The Company's REIT taxable income for the
year 1995 is $10,497 of which $2,371 represents long-term capital gain,
which would require the Company to distribute approximately $9,972. For
the year ended December 31, 1995, the Company has distributed $19,894 or
$1.71 per share to its shareholders, of which approximately 35% represents
a return of capital.

The Company expects to meet certain long-term liquidity requirements such
as scheduled debt maturities, repayment of loans for construction,
development, and acquisition activities through the issuance of long-term
secured and unsecured debt and additional equity securities of the Company
(or OP Units). On July 20, 1995, the Company's shelf registration became
effective. The registration covers up to an aggregate of $200,000 of debt
securities, preferred shares, common shares and security warrants which the
Company may issue from time to time.

On January 30, 1996, the Company issued 1,200,000 Series A cumulative
convertible preferred shares of beneficial interest for $20 per share, or
$24,000, directly to four institutional investors and Amli in a registered
offering, without the use of a placement agent or underwriter. The
proceeds of the offering, less $75 of transaction costs, were used to
reduce the Company's debt, fund development costs and for working capital
requirements. Amli elected to convert its 100,000 preferred shares to
100,000 common shares on February 29, 1996.

During 1994, the Company commenced development of three residential
apartment communities, AMLI at Autumn Chase Phase II and AMLI at Gleneagles
Phase II (both located in Dallas) and AMLI at Sope Creek Phase IV in
Atlanta. The approximate development costs (including land cost) are
$35,000. AMLI at Sope Creek Phase IV was completed in December 1995. The
construction of the properties in Dallas is expected to be substantially
completed in 1996. The Company has also commenced development activities
on additional sites in Austin, Texas and Overland Park, Kansas.
Furthermore, in 1995 the Company started planning and pre-development
activities on four additional sites in Fort Worth, Dallas, Atlanta and
Kansas. The costs of these development activities are expected to be
funded from existing credit availability and/or in partnership with
institutional investors.

In February 1996, the Company acquired two land parcels in Atlanta, Georgia
and Aurora, Illinois for a total price of $11,023. The Atlanta parcel was
acquired for cash and a note anticipated to be paid by June 30, 1996. The
consideration for the Aurora land parcel was satisfied in part by 26,182 OP
Units, with the remaining purchase price paid in cash. The Company intends
to develop a 272-unit apartment community on the Aurora site in partnership
with an institutional investor and an 800-unit apartment community on the
Atlanta site either for its own account or in partnership with an
institutional investor.

In January 1995, the Company, through a co-investment partnership,
commenced construction of the 502-unit AMLI at Pleasant Hill apartment
development. Total development costs of approximately $26,100 were funded
first from the venturers' capital contributions and thereafter are being
funded from the $15,500 fixed rate construction and permanent loan provided
by the co-venturer.

In November 1995, the Company, through a co-investment joint venture, began
construction of the 446-unit AMLI at Barrett Lakes apartment community on
54 acres of land located in Atlanta, Georgia. Of the total estimated
development costs of $27,800, the co-venturer has provided $16,680 of
construction and permanent financing for this development, and the
remaining costs are being funded from the Company's and the co-investor's
equity contributions.

CAPITAL EXPENDITURES

Capital expenditures are those made for assets having a useful life in
excess of one year and include replacements (including carpet and major
appliances) and betterments, such as unit upgrades, enclosed parking
facilities and similar items.

At the end of 1994, the Company reviewed its estimates relating to
depreciation and to repairs and replacements and improvements to real and
personal property. Based on this review, effective January 1, 1995, the
Company commenced expensing certain expenditures which had previously been
capitalized and changed the estimated useful lives of certain land
improvements, fixtures and equipment to 15 years from 5 years. The effect
of this change in estimate was a $336 increase in repairs and maintenance
(which reduced funds from operations by $.02 per share) and a $961 decrease
in depreciation, resulting in an increase in net income for the year ended
December 31, 1995 by approximately $625, or $.04 per share.

At the closing of the Initial Offering, ARPG provided the Company with
slightly more than $3,000 in restricted and unrestricted cash balances. Of
this total, approximately $2,500 (including $990 spent directly from an
escrow established by certain of the Original Investors) was used to fund
capital expenditures for the existing properties. The amount not
designated for capital improvements (approximately $550) has been used for
costs associated with refinancing a portion of the Company's total debt.

During 1995, a total of $4,554 was spent on building repairs and
maintenance (including contract services) and $1,811 was spent on
landscaping and grounds maintenance, as follows:

BUILDING REPAIRS AND MAINTENANCE
Painting (exterior and interior) $1,033
Carpet and Vinyl 571
Carpentry 208
Heating and air conditioning 192
Plumbing 176
Appliances 160
Electrical systems 108
Parking lots/Resurfacing 103
Other repairs and maintenance 393

CONTRACT SERVICES
Security services 626
Rubbish collection services 476
Cleaning services 263
Pest control services 183
Other services 62
------
$4,554
======
LANDSCAPING AND GROUNDS MAINTENANCE
Lawn maintenance $1,559
Seasonal color 190
All other 62
------
$1,811
======

During 1995, a total of $1,714 in capital expenditures were capitalized in
accordance with the Company's policy, as follows:

Carpet replacement $1,263
Landscaping improvements 273
All other 178
------
$1,714
======

<TABLE>
The Company's accounting treatment of various capital and maintenance costs is detailed in the following
table.

<CAPTION>
CAPITALIZE/ DEPRECIABLE
EXPENDITURES EXPENSE LIFE IN YEARS
----------------------------------- ---------- -------------
<S> <C> <C>

Improvements, upgrades, additions (not replacements -
includes additional garages, additional amenities, etc.)* capitalize 15 or 40
Costs budgeted as a part of an "Approved Acquisition
budget" (must be spent within one year of
acquisition)* capitalize 5, 15, or 40
Replacement of carpet for entire unit capitalize 5
Replacement of major appliances (refrigerators, stoves,
dishwashers, washers/dryers) capitalize 15
Replacement of kitchen cabinets capitalize 15
New landscaping construction or installation capitalize 15
Roof replacements capitalize 15
Exercise/amenity equipment capitalize 5
Maintenance equipment capitalize 5
New model or clubhouse furniture and fixtures capitalize 5
New computer systems (entire systems) capitalize 5
Roof repairs expense n/a
Exterior painting expense n/a
Parking lot repairs/resurfacing expense n/a
Repairs to amenity areas, including swimming pools expense n/a
Vinyl expense n/a
All expenditures for acquiring or replacing ceiling fans,
mini-blinds, air conditioning compressors,
garbage disposals, etc. expense n/a
Landscaping replacements expense n/a
Computer expenditures (anything less than a full system) expense n/a
Replacement signage expense n/a
Repairs to or refinishing of kitchen cabinetry expense n/a
Equipment repairs (all types) expense n/a
All interior painting expense n/a
In general, we expense any disbursement totalling less than $2,500

<FN>
* The current policy provides that most capitalizable additions will have a life of 15 years, except for the
items of personal property which have estimated lives of 5 years. Included in an Acquisition Budget may be some
costs which would otherwise be expensed, such as exterior painting; such items are being depreciated over 15
years.
</TABLE>

INFLATION

Virtually all apartment leases at the Properties and co-investment
properties are for six or twelve months' duration. This enables the
Company to pass along inflationary increases in its operating expenses on a
timely basis. Because the Company's property operating expenses (exclusive
of depreciation and amortization) are approximately 41.9% of rental and
other revenue, increased inflation typically results in comparable
increases in income before interest and general and administrative
expenses, so long as rental market conditions allow increases in rental
rates while maintaining stable occupancy.

An increase in general price levels may immediately precede, or accompany,
an increase in interest rates. The Company's exposure to rising interest
rates is mitigated by the existing debt level of approximately 44% of the
Company's current market capitalization (approximately 40% following the
issuance of $24,000 of preferred shares on January 30, 1996), by including
intermediate term fixed rate debt, and by having interest rate protection
in place on substantially all of its variable rate indebtedness through
August 1, 1997 with respect to LIBOR and through February 15, 1997 with
respect to a tax exempt index. As a result, for the foreseeable future,
increases in interest expense resulting from increasing inflation are
anticipated to be less than future increases in income before interest and
general and administrative expenses.

RESULTS OF OPERATIONS

During the period from January 1, 1994 through December 31, 1995 growth in
property revenues and property operating expenses resulted both from
increases at the Properties owned as of January 1, 1994 and from the six
properties acquired during the period. The Company acquired the newly
constructed 424-unit AMLI on the Green in Fort Worth on February 16, 1994,
the 250-unit AMLI at Chase Oaks in Dallas on June 17, 1994, and an
aggregate of 908 units in four apartment communities (AMLI at Alvamar, AMLI
at Crown Colony, AMLI at Regents Center and AMLI at Sherwood) in Kansas on
October 18, 1994.

During the same period, the Company invested in five co-investment
partnerships, which own the 588-unit AMLI at Park Place in Austin, Texas,
the 236-unit AMLI at Windbrooke in Buffalo Grove, Illinois, the 242-unit
AMLI at Willeo Creek in Roswell, Georgia, and the 246-unit AMLI at
Champions Park, the 192-unit AMLI at Champions Centre and the 316-unit AMLI
at Greenwood Forest, all located in Houston, Texas.

For the year ended December 31, 1995, net income was $13,719, or $1.18 per
share, on total revenues of $75,375 (including a $1,498 non-recurring gain
on the sale of a residential property). After an extraordinary loss of
$2,007 on early extinguishment of debt and gain resulting from interest
rate cap contracts of $960, the net income for the year ended December 31,
1994 was $8,710 on total revenues of $66,175 (including a $960 non-
recurring gain resulting from interest rate cap contracts).

The Company has changed the method of accounting for its investments in the
Service Companies to the equity method from the cost method effective with
the financial statements issued for the year ended December 31, 1995. The
Company was required to restate its financial statements for the year ended
December 31, 1994 to conform to the 1995 presentation. The effect of the
restatement was not material in any year.

On a "same community" basis, weighted average occupancy of the apartment
units increased slightly to 96.1% for the year ended December 31, 1995 from
95.5% for the same period in the prior year. Weighted average collected
rental rates increased by 4.9% to $622 from $593 per unit per month for the
years ended December 31, 1995 and 1994, respectively.

COMPARISON OF YEAR ENDED DECEMBER 31, 1995 TO YEAR ENDED DECEMBER 31, 1994

Income before income taxes, non-recurring gains, minority interest and
extraordinary item increased to $15,508 for the year ended December 31,
1995 from $12,500 for the year ended December 31, 1994. For the year ended
December 31, 1995 net income increased to $13,719 from $8,710 for the year
ended December 31, 1994. This increase in net income was primarily
attributable to a $8,662 increase in total revenues, a $1,498 gain on the
sale of a residential property recognized in 1995 and a $2,007 loss on
early extinguishment of debt recognized in 1994, reduced by a $3,998
increase in property operating expenses, a $680 expense relating to the
AMLI brand name in 1995 and a $960 gain resulting from interest rate cap
contracts recognized in 1994.

Rental revenues increased by $8,218, or 13.4%. The increase in rental
revenues for the year ended December 31, 1995 attributable to properties
acquired after January 1, 1994 (net of property sold) was $5,355 and
accounted for 65.2% of the increase. Rental revenues from properties owned
at January 1, 1994 increased by $2,863, or 5.5%, and accounted for 34.8% of
the increase.

Property operating expenses increased by $3,998, or 15.2%. The increase in
property operating expenses for the year ended December 31, 1995 from
properties acquired after January 1, 1994 (net of property sold) accounted
for $2,468, or 61.7% of the increase. Property operating expenses from
properties owned at January 1, 1994 increased $1,530, or 6.7%, and
accounted for 38.3% of the increase.

Interest expense, net of the amounts capitalized, for the year ended
December 31, 1995, increased to $12,926 from $11,557 for the prior year, or
11.8%. The increase was primarily due to increased borrowings to fund
acquisition and development activities, reduced in part, as a result of the
decline in floating interest rates in 1995 after rising in 1994.

General and administrative expenses increased to $1,932 for the year ended
December 31, 1995 from $1,616 for the year ended December 31, 1994, or
19.6%. The increase was attributable to recurring costs incurred in 1995
for the first time, including costs relating to the Company's Annual Report
to shareholders and the annual shareholders' meeting, and increases in
professional fees.

COMPARISON OF YEAR ENDED DECEMBER 31, 1994 TO YEAR ENDED DECEMBER 31, 1993

For the year ended December 31, 1994, net income was $8,710 compared with a
loss of $1,695 for the year ended December 31, 1993. This increase in net
income was in part attributable to a $4,285 reduction of interest expense
and a $960 gain resulting from interest rate cap contracts (see note 2 of
notes to financial statements). Income before income taxes, minority
interest and extraordinary item increased to $13,460 for the year ended
December 31, 1994 from loss of $996 for the year ended December 31, 1993.

Rental revenues increased by $15,685, or 34.5%. The increase in rental
revenues for the year ended December 31, 1994 attributable to properties
acquired subsequent to January 1, 1993 was $12,535 and accounted for 79.9%
of the increase. Rental revenues from properties owned at January 1, 1993
increased by $3,150, or 7.3%, and accounted for 20.1% of the increase. The
weighted average monthly rental rate per occupied unit increased to $606
for the year ended December 31, 1994 from $559 for the prior year, or 8.4%.

Weighted average occupancy rates for the year ended December 31, 1994
reflect a slight decrease from the prior year.

Other income for the year ended December 31, 1994 includes $150 in fees
charged to Amli for various accounting and administrative services and $382
in acquisition and asset management fees earned from the two new co-
investment partnerships and the Company's proportionate share of net income
from these partnerships. The co-investment partnerships were formed by the
Company during the second quarter to acquire the 588-unit AMLI at Park
Place, the 246-unit AMLI at Champions Park, and the 192-unit AMLI at
Champions Centre apartment communities located in Houston, Texas.

Property operating expenses excluding management fees increased by $4,830,
or 24.1%. The increase in property operating expenses for the year ended
December 31, 1994 from properties owned at January 1, 1993 accounted for
$463 (9.6%) of the increase, and the remaining increase is due to
properties purchased subsequent to January 1, 1993.

Interest expense decreased from $15,842 to $11,557, or 27.0%. The effect
on interest expense of an increase in debt through February 14, 1994 was
offset by the significant decrease in debt resulting from the closing of
the Initial Offering and by the decline in the average interest rate of the
Company's and ARPG's debt (to 5.2% from 6.8% average for the year ended
1994 and 1993, respectively). The $11,400 mortgage loan on AMLI at Valley
Ranch apartments in Dallas was refinanced at its scheduled July 1, 1993
maturity for ten years at 7.625%, or 1.846% less than the previous fixed
rate.

General and administrative expenses decreased to $1,616 for the year ended
December 31, 1994 from $3,257 for the year ended December 31, 1993 . The
decrease is net of several effects, including a decrease resulting from
deconsolidation of the Service Companies and increases in costs associated
with operating as a public company and other increases commensurate with
the increasing level of operations and assets under management.

IMPACT OF ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets to Be Disposed Of" was issued in March 1995
and is effective for fiscal years beginning after December 15, 1995.

Statement of Financial Accounting Standards No. 123, "Accounting for Stock-
Based Compensation Plans" was issued in October 1995. The Statement is
effective for fiscal years beginning after December 15, 1995. As allowed
by the new Statement, the Company plans to continue to use Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees"
in accounting for its stock options.

Neither of these accounting pronouncements are expected to have a material
effect on the financial position or results of operations of the Company.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

AMLI RESIDENTIAL PROPERTIES TRUST

INDEX
-----

PAGE
----

Independent Auditors' Report. . . . . . . . . . . . . . . . . . . . .30

Consolidated Balance Sheets, December 31, 1995 and 1994 . . . . . . .31

Consolidated Statements of Operations, years ended December 31, 1995,
1994 and 1993. . . . . . . . . . . . . . . . . . . . . . . . . . . .32

Consolidated Statements of Shareholders' Equity, years ended December 31,
1995,
1994 and 1993. . . . . . . . . . . . . . . . . . . . . . . . . . . .33

Consolidated Statements of Cash Flows, years ended December 31, 1995,
1994 and 1993. . . . . . . . . . . . . . . . . . . . . . . . . . . .34

Notes to Consolidated Financial Statements. . . . . . . . . . . . . .36

SCHEDULE

Consolidated Real Estate and Accumulated Depreciation . . . . . . . .III

Schedules not filed:

All schedules other than those indicated in the above index have been
omitted as the required information is inapplicable or the information is
presented in the financial statements or related notes.

INDEPENDENT AUDITORS' REPORT

The Board of Trustees
Amli Residential Properties Trust:

We have audited the accompanying consolidated balance sheets of Amli
Residential Properties Trust (the "Company") as of December 31, 1995 and
1994, and the related consolidated statements of operations, shareholders'
equity and cash flows for each of the years in the three-year period ended
December 31, 1995. In connection with our audits of the consolidated
financial statements we have also audited the related financial statement
schedule. These consolidated financial statements and financial statement
schedule are the responsibility of the management of the Company. Our
responsibility is to express an opinion on these consolidated financial
statements and financial statement schedule based on our audits.

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

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of the
Company as of December 31, 1995 and 1994, and the results of its operations
and its cash flows for each of the years in the three-year period ended
December 31, 1995, in conformity with generally accepted accounting
principles. Also in our opinion, the related financial statement schedule,
when considered in relation to the basic consolidated financial statements
taken as a whole, presents fairly, in all material respects, the
information set forth therein.

As discussed in Note 3 to the consolidated financial statements, the
Company changed its method of accounting for its investment in the Service
Companies in 1995.

KPMG Peat Marwick LLP

Chicago, Illinois
February 29, 1996

<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST

CONSOLIDATED BALANCE SHEETS

December 31, 1995 and 1994

(Dollars in thousands, except per share data)
<CAPTION>
1995 1994
--------- --------
<S> <C> <C>
ASSETS:
Rental apartments:
Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 58,643 59,723
Depreciable property. . . . . . . . . . . . . . . . . . . . . . . . 361,011 375,713
-------- -------
419,654 435,436
Less accumulated depreciation . . . . . . . . . . . . . . . . . . . (39,157) (29,574)
-------- -------
380,497 405,862
Property under development. . . . . . . . . . . . . . . . . . . . . . 23,211 16,326
Investment in partnerships. . . . . . . . . . . . . . . . . . . . . . 12,255 2,948
Cash and cash equivalents ($550 restricted at
December 31, 1995 and 1994) . . . . . . . . . . . . . . . . . . . . 2,829 4,010
Deferred expenses, net. . . . . . . . . . . . . . . . . . . . . . . . 5,415 6,211
Security deposits . . . . . . . . . . . . . . . . . . . . . . . . . . 1,880 2,049
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,140 5,213
-------- -------
TOTAL ASSETS. . . . . . . . . . . . . . . . . . . . . . . . $433,227 442,619
======== =======
LIABILITIES AND SHAREHOLDERS' EQUITY:
LIABILITIES:
Debt (note 5) . . . . . . . . . . . . . . . . . . . . . . . . . . . 215,255 217,687
Accrued interest payable. . . . . . . . . . . . . . . . . . . . . . 1,230 1,137
Accrued real estate taxes payable . . . . . . . . . . . . . . . . . 6,471 6,212
Security deposits and prepaid rents . . . . . . . . . . . . . . . . 2,439 2,699
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 2,592 1,980
------- -------
Total liabilities . . . . . . . . . . . . . . . . . . . . . 227,987 229,715
------- -------

AMLI RESIDENTIAL PROPERTIES TRUST

CONSOLIDATED BALANCE SHEETS - CONTINUED

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

Commitments and contingencies (note 7)

Minority interest . . . . . . . . . . . . . . . . . . . . . . . . . . 39,077 42,743
------- -------

SHAREHOLDERS' EQUITY:
Shares of beneficial interest, $.01 par value, 150,000,000
authorized, 11,681,659 and 11,530,370 common shares
issued and outstanding, respectively. . . . . . . . . . . . . . . 117 115
Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . 218,752 216,577
Retained earnings (deficit) . . . . . . . . . . . . . . . . . . . . (20,705) (34,424)
Dividends paid. . . . . . . . . . . . . . . . . . . . . . . . . . . (32,001) (12,107)
-------- -------

Total shareholders' equity. . . . . . . . . . . . . . . . . 166,163 170,161
-------- -------

Total Liabilities and Shareholders' Equity. . . . . . . . . $433,227 442,619
======== =======

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

<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST

CONSOLIDATED STATEMENTS OF OPERATIONS OF THE COMPANY AND
COMBINED STATEMENT OF OPERATIONS OF ARPG (PREDECESSOR)

YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<CAPTION>
1995 1994 1993
------- ------- -------
<S> <C> <C> <C>
Property:
Rental. . . . . . . . . . . . . . . . . . . . . . $69,341 61,123 45,438
Other . . . . . . . . . . . . . . . . . . . . . . 2,797 2,338 1,709
Interest and share of income from Service Companies 458 498 -
Other interest. . . . . . . . . . . . . . . . . . 407 491 313
Other . . . . . . . . . . . . . . . . . . . . . . 874 765 1,074
------- ------- -------
Total revenues. . . . . . . . . . . . . . 73,877 65,215 48,534
------- ------- -------

Expenses:
Personnel . . . . . . . . . . . . . . . . . . . . 5,621 4,769 3,724
Advertising and promotion . . . . . . . . . . . . 2,125 1,836 1,582
Utilities . . . . . . . . . . . . . . . . . . . . 4,125 3,782 3,033
Building repairs and maintenance and services . . 4,554 3,999 3,354
Landscaping and grounds maintenance . . . . . . . 1,811 1,405 1,026
Real estate taxes and insurance . . . . . . . . . 9,104 8,162 6,389
Property management fees. . . . . . . . . . . . . 1,803 1,411 -
Other operating expenses. . . . . . . . . . . . . 1,111 881 800
Landscape services. . . . . . . . . . . . . . . . - 11 107
Interest. . . . . . . . . . . . . . . . . . . . . 12,926 11,557 15,842
Amortization of deferred costs. . . . . . . . . . 1,792 2,659 729
Depreciation. . . . . . . . . . . . . . . . . . . 10,785 10,627 9,687
General and administrative. . . . . . . . . . . . 1,932 1,616 3,257
Expenses associated with the AMLI brand name . . 680 - -
------ ------ ------
Total expenses. . . . . . . . . . . . . . 58,369 52,715 49,530
------- ------- -------

AMLI RESIDENTIAL PROPERTIES TRUST

CONSOLIDATED STATEMENTS OF OPERATIONS OF THE COMPANY AND
COMBINED STATEMENT OF OPERATIONS OF ARPG (PREDECESSOR) - CONTINUED

1995 1994 1993
------- ------- -------

Income (loss) before income taxes, nonrecurring gains,
minority interest and extraordinary items . . . . 15,508 12,500 (996)
Gain on sale of residential property. . . . . . . . 1,498 - -
Gain resulting from interest rate cap contracts . . - 960 -
Income taxes. . . . . . . . . . . . . . . . . . . . - (62) (699)
------- ------- -------
Income (loss) before minority interest
and extraordinary item. . . . . . . . . . . . . . 17,006 13,398 (1,695)
Minority interest . . . . . . . . . . . . . . . . . 3,287 2,681 -
------- ------- -------
Income (loss) before extraordinary item . . . . . . 13,719 10,717 (1,695)
Extraordinary item -
loss on early extinguishment of debt
(net of minority interest). . . . . . . . . . . . - (2,007) -
------- ------- -------
Net income (loss) . . . . . . . . . . . . $13,719 8,710 (1,695)
======= ======= =======

Income per common share:
Before extraordinary item . . . . . . . . . . . . $ 1.18 .92*
Extraordinary item. . . . . . . . . . . . . . . . $ - (.17)*
Income per common share . . . . . . . . . . . . . $ 1.18 .75*
Dividends declared and paid per common share. . . . $ 1.71 1.05*

* For the ten and one-half months subsequent to closing of the Initial Offering on February 15, 1994.

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

<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY OF THE COMPANY
AND COMBINED STATEMENT OF PARTNERS' CAPITAL OF ARPG (PREDECESSOR)
Years ended December 31, 1995, 1994 and 1993
(Dollars in thousands)

SHARES OF
BENEFICIAL INTEREST ADDITIONAL RETAINED
------------------ PAID-IN EARNINGS DIVIDENDS
SHARES AMOUNT CAPITAL (DEFICIT) PAID TOTAL
------ ------ --------- ------------------- -------
<S> <C> <C> <C> <C> <C>
Balance at December 31,
1992 . . . . . . . . $ 33,340 33,340
Contributions, net. 7,512 7,512
Loss. . . . . . . . (1,695) (1,695)
-------- -------
Balance at December 31,
1993 . . . . . . . . 39,157 39,157
Distributions, net. (1,457) (1,457)
Net income (through
February 14, 1994). 44 44
-------- --------
37,744 37,744
Effect of the reorgani-
zation. . . . . . 1,172,870 $ 12 21,474 (37,227) (15,741)
Net proceeds from the
Offering. . . . . 10,357,500 103 195,103 - - 195,206
Minority interest . - - - (43,607) - (43,607)
---------- ------ -------- -------- --------- --------
Balance after the
reorganization and
offering . . . . . . 11,530,370 115 216,577 (43,090) - 173,602
Net income. . . . . - - - 8,666 - 8,666
Dividends paid. . . - - - - (12,107) (12,107)
---------- ------ -------- -------- --------- --------
Balance at December 31,
1994. . . . . . . . 11,530,370 115 216,577 (34,424) (12,107) 170,161

Units converted to
shares . . . . . . . 151,289 2 2,175 - - 2,177
Net income. . . . . - - - 13,719 - 13,719
Dividends paid. . . - - - - (19,894) (19,894)
---------- ------ -------- -------- --------- --------
Balance at December 31,
1995. . . . . . . . 11,681,659 $117 218,752 (20,705) (32,001) 166,163
========== ====== ======== ======== ========= ========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>

<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST

CONSOLIDATED STATEMENTS OF CASH FLOWS OF THE COMPANY AND
COMBINED STATEMENT OF CASH FLOWS OF ARPG (PREDECESSOR)

YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
(DOLLARS IN THOUSANDS)

<CAPTION>
1995 1994 1993
--------- -------- --------
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) . . . . . . . . . . . . . . . . $ 13,719 8,710 (1,695)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation. . . . . . . . . . . . . . . . . . 10,785 10,627 9,687
Amortization of deferred costs. . . . . . . . . 1,792 2,659 729
Income from partnerships. . . . . . . . . . . . (34) (77) -
Gain resulting from interest rate cap contracts - (960) -
Loss on early extinguishment of debt. . . . . . - 2,511 -
Gain on sale of residential property. . . . . . (1,498) - -
Minority interest . . . . . . . . . . . . . . . 3,287 2,177 -
Changes in assets and liabilities:
Increase in deferred expenses . . . . . . . . . (245) (173) (555)
Decrease (increase) in security deposits. . . . 168 (505) (228)
Decrease (increase) in other assets . . . . . . 474 (666) 578
Increase (decrease) in accrued interest payable 93 (215) 298
Increase in accrued real estate taxes . . . . . 259 1,339 808
(Decrease) increase in tenant security deposits
and prepaid rents. . . . . . . . . . . . . . . (260) 817 566
Increase in other liabilities . . . . . . . . . 612 1,266 406
--------- -------- --------
Net cash provided by operating activities 29,152 27,510 10,594
--------- -------- --------
Cash flows from investing activities:
Purchase of partnerships interests. . . . . . . . - (64,282) -
Net cash proceeds from sale of residential property 29,583 - -
Investments in partnerships . . . . . . . . . . . (5,960) (3,016) -
Cash distributions from partnerships. . . . . . . 370 145 -
Advances to affiliates. . . . . . . . . . . . . . (3,050) (530) -
Earnest money deposits. . . . . . . . . . . . . . (350) (150) -
Capital expenditures - existing properties. . . . (1,714) (2,887) (1,580)
Acquisition properties. . . . . . . . . . . . . . (8,847) (61,757) (70,216)
Properties under development, net of reimbursable
co-investor's costs . . . . . . . . . . . . . . (13,401) (11,522) -
--------- -------- --------
Net cash used in investing activities . . (3,369) (143,999) (71,796)
--------- -------- --------

AMLI RESIDENTIAL PROPERTIES TRUST

CONSOLIDATED STATEMENTS OF CASH FLOWS OF THE COMPANY AND
COMBINED STATEMENT OF CASH FLOWS OF ARPG (PREDECESSOR) - CONTINUED

1995 1994 1993
--------- -------- --------
Cash flows from financing activities:
Debt proceeds, net of financing costs . . . . . . 71,800 273,979 82,386
Debt repayments, including prepayment penalties
in 1994. . . . . . . . . . . . . . . . . . . . . (74,094) (344,664) (24,947)
Net proceeds from the sale of interest
rate cap contracts . . . . . . . . . . . . . . . - 2,410 -
Proceeds from the Offering, net of issuance costs - 195,206 -
Contributions . . . . . . . . . . . . . . . . . . - 448 14,205
Distributions . . . . . . . . . . . . . . . . . . (4,776) (4,946) (6,693)
Dividends paid. . . . . . . . . . . . . . . . . . (19,894) (12,107) -
--------- -------- --------
Net cash provided by (used in)
financing activities. . . . . . . . . . (26,964) 110,326 64,951
--------- -------- --------

Net increase (decrease) in cash and cash equivalents (1,181) (6,163) 3,749
Cash and cash equivalents at beginning of year. . . 4,010 10,173 6,424
--------- -------- --------
Cash and cash equivalents at end of year. . . . . . $ 2,829 4,010 10,173
========= ======== ========

Supplemental disclosures of noncash investing and
financing activities:
Residential real estate acquired pursuant
to existing debt . . . . . . . . . . . . . . . . - 12,192 3,222
Minority interest . . . . . . . . . . . . . . . . (2,177) - -
Shares of beneficial interest and additional
paid-in capital. . . . . . . . . . . . . . . . . 2,177 - -

Supplemental disclosures of cash flow information:
Cash paid for mortgage and other interest, net of
amounts capitalized . . . . . . . . . . . . . . $ 12,833 11,772 15,544

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

AMLI RESIDENTIAL PROPERTIES TRUST

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

1. ORGANIZATION AND BASIS OF PRESENTATION

ORGANIZATION

Amli Residential Properties Trust (the "Company"), a self-administered
and self-managed real estate investment trust ("REIT"), was formed on
February 15, 1994 to continue and expand the multifamily property business
previously conducted by Amli Realty Co. and its affiliates ("Amli"). The
Company is the successor to the operations of Amli Residential Properties
Group ("ARPG" or the "Predecessor"). The Company is the sole general
partner of Amli Residential Properties, L.P. (the "Operating Partnership")
in which it holds an 81% interest. All the properties (the "Properties")
and property interests are owned and operated through the Operating
Partnership. The Company and its affiliates develop, acquire, lease,
manage and hold for investment upscale residential apartment communities.

The Company commenced operations effective with the completion of its
initial public offering ("Initial Offering") on February 15, 1994. The
Company qualifies as a real estate investment trust for Federal income tax
purposes.

At December 31, 1995, no preferred shares were issued and outstanding.
On January 30, 1996, the Company issued 1,200,000 Series A convertible
preferred shares, $.01 par value, at $20 per share (see note 8).

During 1995, the Company created a brand name utilizing the AMLI name.

The process required changing property signage (which includes the AMLI
name), stationery and marketing materials to include products that will
identify the Company's residential communities. The Company completed the
implementation of this brand name strategy in the fall of 1995, and
incurred a total cost of $680.

BASIS OF PRESENTATION

For the periods after the Initial Offering, the accompanying
consolidated financial statements include the accounts of the Company and
the Operating Partnership. For the periods before the Initial Offering,
the accompanying combined financial statements reflect the combined
accounts of ARPG.

ARPG consisted of various limited partnerships ("Original Investors")
sponsored by Amli which previously owned 20 residential properties, general
partner interests in three additional limited partnerships sponsored by
Amli ("GP Properties"), and certain property management, landscaping,
investment advisory and asset management subsidiaries and divisions of Amli
which were contributed to the Company. The accounts are presented on a
combined basis because of the common ownership interest and management.
The Company raised capital through the Initial Offering and structured the
business combination so that the partners and owners of each of the
Original Investors in ARPG received cash, limited partnership interests
("OP Units") in the Operating Partnership, common shares of the Company, or
a combination thereof. The OP Units are convertible into shares of the
Company on a one-for-one basis, subject to certain limitations. During
1995, a total of 151,289 OP Units were converted to shares, so that at
December 31, 1995 the Company owns 11,681,659 OP Units of the total of
14,426,710.

Amli Management Company, Amli Institutional Advisors, Inc., Amrescon,
Inc., and Amli Landscape Co., a division of Amrescon, Inc., (the "Service
Companies") provide services to the Company's wholly-owned properties as
well as to properties owned by or joint ventured with third parties.

The GP Properties (AMLI at Prairie Court in Oak Park, Illinois, AMLI at
Towne Creek in Gainesville, Georgia and Abbey Crossing in Atlanta, Georgia)
are accounted for using the equity method. These interests are not
material to the accompanying consolidated financial statements.

The accompanying consolidated and combined financial statements use the
historical basis of accounting. Certain limited partners in certain of the
Original Investors received cash for 50% or more of the value of their
limited partnership interests contributed to the Operating Partnership.
Purchase accounting was applied to the acquisition of these interests. The
acquisition of all other interests was accounted for as a reorganization of
entities under common control and, accordingly, assets and liabilities
related to those interests continue to be reflected at historical costs in
a manner similar to that used in pooling of interests accounting. All
significant inter-entity balances and transactions have been eliminated in
consolidation.

The Company's management has made a number of estimates and assumptions
relating to the reporting of assets and liabilities and disclosure of
contingent assets and liabilities to prepare these financial statements in
conformity with generally accepted accounting principles. Actual amounts
realized or paid could differ from these estimates.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Real Estate Assets and Depreciation

Real estate assets are stated at cost less accumulated depreciation.
Ordinary repairs and maintenance are expensed as incurred; replacements
having an estimated useful life of at least one year and betterments are
capitalized and depreciated over their estimated useful lives.
Depreciation is computed on a straight-line basis over useful lives of the
properties (buildings and related land improvements -- 40 years; furniture,
fixtures and equipment -- 5 - 15 years). Substantially all real estate
assets are pledged to secure debt (see note 5).

At the end of 1994, the Company reviewed its policies relating to
depreciation and to repairs, replacements and improvements to real and
personal property. Based on this review, effective January 1, 1995, the
Company commenced expensing certain expenditures which had previously been
capitalized and changed the estimated useful lives of certain land
improvements, fixtures and equipment to 15 years from 5 years. The effect
of this change in estimate was a $336 increase in repairs and maintenance
and a $961 decrease in depreciation, resulting in an increase in net income
for the year ended December 31, 1995 of approximately $625, or $.04 per
share.

In conjunction with acquisitions of existing properties, it is the
Company's policy to provide in its acquisition budgets adequate funds to
complete any deferred maintenance items and to otherwise make the
properties acquired competitive with comparable newly-constructed
properties. In some cases the Company will provide in its acquisition
budget additional funds to upgrade or otherwise improve new acquisitions.
Such costs for the years ended December 31, 1995 and 1994 totalled $943 and
$640, respectively, and are included in acquisition properties in the
accompanying consolidated statements of cash flows. At the closing of the
Initial Offering, ARPG provided the Company with slightly more than $3,000
in restricted and unrestricted cash balances. Of this total, approximately
$2,500 (including $990 spent directly from an escrow established by certain
of the Original Investors) was set aside to fund capital expenditures for
the existing properties. The amount not designated for capital
improvements (approximately $550) has been used for costs associated with
refinancing a portion of the Company's total debt. At December 31, 1994,
the Company had completed the capital improvements program and incurred all
of the $2,500 for such capital improvements.

On August 11, 1995, the Company closed the sale of the 421-unit Club
Laguna apartments located in Orange County, California. The sale price of
$29,908 was paid in cash, and the net proceeds of the sale were used in
part to pay down the Lehman Line of Credit ($16,720 of which was secured by
this property). The rental apartments in the accompanying balance sheet at
December 31, 1995 have been reduced by $28,084 of cost and related
accumulated depreciation reflecting the sale of Club Laguna.

<TABLE>

Losses in carrying values of investment assets are provided by management when the losses become apparent and
the investment asset is considered impaired. Management evaluates its investment properties at least quarterly to
assess whether any impairment indications are present, comparing undiscounted future cash flows with the carrying
amount of the asset. If any investment asset is considered impaired, a loss is provided to reduce the carrying
value of the property to its estimated value. Management believes that no assets are impaired; therefore, no such
losses have been required to be recognized or provided in the accompanying financial statements.

Statement of Financial Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived Assets to be
Disposed Of" was issued in March 1995 and is effective for the fiscal years beginning after December 15, 1995.
The statement is not expected to have a material effect on the financial position or results of operations of the
Company.

PROPERTIES UNDER DEVELOPMENT

During 1995, the Company acquired five land parcels located in Fort Worth, Texas, Atlanta, Georgia and Eastern
Kansas for a total cost of $7,502. One of the land parcels in Atlanta, which was purchased for $1,965, was
conveyed at cost to Barrett Lakes Limited Liability Company in November 1995. These newly acquired parcels of
land are currently in the development planning stage; physical construction will commence or continue during 1996
on all of these properties. The table below shows all land parcels that are currently under development.

<CAPTION>
NUMBER NUMBER TOTAL
OF OF EXPENDED
PROPERTY LOCATION ACRES UNITS THRU 12/31/95
-------- -------- --------- --------- -------------
<S> <C> <C> <C> <C>
Wholly Owned:

AMLI at River Park (1) Fulton County, GA 23 222 $2,699
AMLI at Autumn Chase II Carrollton, TX 21 224 7,713
AMLI at Autumn Chase III Carrollton, TX 24 236 1,498
AMLI at Gleneagles II Dallas, TX 12 264 3,345
AMLI on Rosemeade II Dallas, TX 10 240 1,258
AMLI at Fossil Creek (1) Ft. Worth, TX 19 384 1,601
AMLI at Wells Branch (1) Austin, TX 29 550 3,246
AMLI at Crown Colony II Topeka, KS 4 64 373
AMLI at Regents Center III Overland Park, KS 16 124 1,478
--- ------ -------

Total 158 2,308 $23,211
=== ===== =======
</TABLE>

Co-Investment (Company Ownership Percentage):

AMLI at Barrett Lakes (35%) (2)Cobb County, GA54446$ 3,992
AMLI at Pleasant Hill (40%) (3)Gwinnett County, GA 45 502 20,808

(1) It is the Company's intention to develop these land parcels in
partnership with one or more institutional investors.

(2) AMLI at Barrett Lakes was conveyed at cost to a 35%-owned co-
investment venture in November 1995.

(3) AMLI at Pleasant Hill commenced rental operations in June 1995. At
December 31, 1995, 252 units of 502 total units were leased and
substantially complete and ready for occupancy (of which 222 were
occupied). The completion of the construction and development of AMLI at
Pleasant Hill is expected to occur in August 1996.

INTEREST AND REAL ESTATE TAX CAPITALIZATION

Interest and real estate taxes incurred during the construction period
are capitalized and depreciated over the lives of the constructed assets.
During the years ended December 31, 1995 and 1994 total interest
capitalized was $1,638 and $498, respectively. Net of amounts capitalized,
total interest incurred during the years ended December 31, 1995, 1994 and
1993 aggregated $12,926, $11,557 and $15,842, respectively.

REVENUE RECOGNITION

Rental revenues -- the Company leases its residential properties under
operating leases with terms generally of six or twelve months. Rental
income is recognized when earned; this method approximates recognition
using the straight-line method over the related lease term. At December
31, 1995 apartment leases in effect provide for annual rentals aggregating
approximately $69,953.

Prior to the Initial Offering, certain fees for property management,
landscape services and asset management were eliminated in the combination.

FAIR VALUES

The estimated fair values of the Company's financial instruments (as
defined) presented in these Notes to Financial Statements have been
determined by management based on pertinent information available as of
December 31, 1995 and 1994, using appropriate methodologies. These
estimates are not necessarily indicative of the amounts the Company could
ultimately realize.

The Company's financial instruments consist primarily of its cash
equivalents, interest-bearing notes receivable from the Service Companies,
operating payables, debt and interest rate limitation contracts. The
carrying amounts of the Company's cash equivalents and operating payables
are considered to be a reasonable estimate of fair value due to the short-
term nature of these instruments.

CASH AND CASH EQUIVALENTS

For purposes of the statement of cash flows, the Company considers all
investments purchased with an original maturity of three months or less to
be cash equivalents. At December 31, 1995 and 1994, cash balances of $550
are restricted as required by the provisions of the indentures of trust
relating to tax-exempt bonds.

DEFERRED EXPENSES

Deferred costs consist primarily of financing costs which are amortized
using the straight-line method over the terms of the related debt. During
the construction period, amortization of deferred costs relating to
properties under development are capitalized and depreciated over the lives
of the constructed assets. During the years ended December 31, 1995 and
1994, capitalized amortization was $214 and $10, respectively. Deferred
expenses at December 31, 1995 include $1,341 in unamortized cost of
interest rate cap contracts which limit the Company's exposure to
increasing rates through various dates in 1997 and 1998. Amounts paid for
purchased interest rate cap agreements are amortized over the terms of the
related cap contracts.

On August 9, 1994, the Company completed refinancing $74,793 of its debt
under two new loans from Lehman Brothers Holdings Inc., referred to as the
$54,835 Lehman Whole Loan and the $56,348 Lehman Line of Credit. Generally
accepted accounting principles require that the interest rate cap contracts
be "marked to market" and that the Company record a gain on the excess of
value over unamortized cost as of the date of refinancing. Because a
portion of one interest rate cap contract had become redundant and another
was now associated with the Lehman Line of Credit, the Company elected to
sell these interest cap contracts while keeping in place interest rate caps
on substantially all of its floating rate debt. The Company realized a
total gain (including the gain recognized at the August 9, 1994 refinancing
from marking the interest rate cap contract to market) of $960 resulting
from the above-mentioned LIBOR interest rate cap contract activities.

INTEREST RATE LIMITATION CONTRACTS

The Company uses interest rate caps and swaps to limit its exposure to
increases in interest rates on its floating rate debt. The Company does
not use them for trading purposes.

At December 31, 1995, the Company was a party to various interest rate
cap agreements which entitle the Company to receive from counterparties on
a monthly basis the amounts, if any, by which the Company's interest
payments on certain floating rate debt exceed capped amounts.

The Company is exposed to credit losses in the event of nonperformance
by the counterparties to its interest rate caps. The Company does not
obtain collateral or other security to support financial instruments
subject to credit risk but monitors the credit standing of counterparties.
The Company anticipates, however, that the counterparties will be able to
fully satisfy their obligations under the contracts.

<TABLE>
The following summarizes payments received pursuant to interest rate limitation and swap contracts and the
estimated remaining value of such contracts at December 31, 1995.
<CAPTION>
UNAMORTIZED CUMULATIVE
REMAINING COST CASH APPROXIMATE
NATIONALMAXIMUM TYPE OF CONTRACT ORIGINAL DECEMBER PAYMENTS VALUE
AMOUNT RATE CONTRACT MATURITY COST 1995 RECEIVED DECEMBER 1995
<S> <C> <C> <C> <C> <C> <C> <C>

$54,835 3.875% LIBOR Cap 8/1/97 $2,949 861 2,495 1,115
15,000 3.875% LIBOR Cap N/A 806 - 1,473 -
15,000 7.5% LIBOR Cap 4/1/97 160 80 - -
5,845 3.875% LIBOR Cap 2/15/98 314 167 162 154
31,250 3.0% Tax-Exempt Cap 2/15/97 621 233 323 199
12,4006.47% (all-in) Swap 2/15/97 - - 141 41
----- ----- ----- -----
$4,850 1,341 4,594 1,509
====== ===== ===== =====
<FN>
As of February 29, 1996, the estimated fair value of the interest rate caps and swaps is approximately $1,552.

In addition, in December 1995 the Company purchased a 60-day $30,000 Treasury Lock in relation to the
anticipated refinancing of its $54,835 Lehman Whole Loan. At February 29, 1996 the Company had fixed a 7.3% seven
year rate on $31,000 of replacement financing and had an additional $20,000 in Treasury Locks in place. The
Company may continue to use the purchase of Treasury Locks or other financial derivatives to limit its exposure to
increases in the ten-year Treasury rate until the interest rate is fixed on all refinancings replacing the Lehman
Whole Loan (anticipated to occur in April 1996).

OTHER ASSETS

At December 31, 1995 other assets consist primarily of $3,500 in 13% interest-only notes receivable from the
Service Companies due in 2004, $1,672 in other current receivables from the Service Companies and $500 in escrow
deposits. The Company believes that the carrying amount of its notes receivable from the Service Companies
reasonably approximate their fair values.

PER SHARE DATA

Net income per share is computed based upon 11,634,776 weighted average shares outstanding in 1995 and
11,488,651 weighted average shares outstanding during the period from February 15, 1994 through December 31, 1994.

At December 31, 1995 there were 11,681,659 shares outstanding. Fully diluted earnings per share is not presented
as the impact is not material.

RECLASSIFICATIONS

Certain amounts in the consolidated 1994 financial statements of the Company and combined 1993 financial
statements of ARPG have been reclassified to conform with the current presentation.
</TABLE>

<TABLE>
3. INVESTMENTS IN PARTNERSHIPS AND SERVICE COMPANIES

Investments in Partnerships

At December 31, 1995, the Company, as general partner, owns co-investment partnership interests in Amli
Foundation Co-Investors, L.P. ("Foundation"); Amli Foundation Co-Investors-II, L.P. ("Foundation II"); Amli at
Champions, L.P. ("Champions"); Amli at Windbrooke, L.P. ("Windbrooke"); Amli at Willeo Creek, L.P. ("Willeo
Creek"); Pleasant Hill Joint Venture ("Pleasant Hill"); and Barrett Lakes Limited Liability Company ("Barrett");
and a nominal interest in the GP Properties. These co-investment partnerships are accounted for using the equity
method. Investments in partnerships at December 31, 1995 and the Company's 1995 share of income or loss from each
(excluding the GP Properties from which the Company received distributions and recorded income of $2) are
summarized as follows:
<CAPTION>

EQUITY (DEFICITS)
-------------------- COMPANY'S
PROPERTY (COMPANY'S TOTAL COMPANY'S COMPANY'S NET INCOMESHARE OF NET
PARTNERSHIP OWNERSHIP PERCENTAGE ASSETS TOTAL SHARE INVESTMENT (LOSS) INCOME (LOSS)
- ----------- --------- ------ ----- --------- ---------- -----------------------
<S> <C> <C> <C> <C> <C> <C>
Foundation AMLI at Park Place (25%) $20,658 7,116 1,780 1,742 354 90
Foundation II AMLI at Greenwood Forest (15%) 18,086 5,946 892 872 (226) (33)
Champions AMLI at Champions Park (15%) 13,032 3,355 503 503 (273) (41)
Champions AMLI at Champions Centre (15%) 10,158 3,009 451 443 (398) (60)
Windbrooke AMLI at Windbrooke (15%) 18,174 6,190 928 928 (38) (6)
Willeo Creek AMLI at Willeo Creek (30%) 15,829 5,630 1,689 1,692 (7) -
Pleasant Hill
(1) AMLI at Pleasant Hill (40%) 21,215 12,012 5,122 4,869 207 82
Barrett AMLI at Barrett Lakes (35%) 4,013 3,406 1,192 1,206 - -
======= ====== ------- ------- ==== ----

$12,557 12,255 32
======= ====== ===

<FN>
(1) At December 31, 1994, this partnership was wholly-owned by the Company and its accounts (including land and
development costs of $5,608, of which $1,925 was reimbursable) were included in the consolidated financial
statements of the Company. On February 1, 1995, the Company admitted The Northwestern Mutual Life Insurance
Company as a joint venture partner, and the accounts of this partnership are now accounted for using the equity
method as described above.
</TABLE>

<TABLE>

The fixed-rate debt financing which has been obtained from various insurance companies on behalf of these co-
investment partnerships is summarized below:
<CAPTION>

TOTAL OUTSTANDING INTEREST
PROPERTY COMMITMENT AT 12/31/95 RATE MATURITY
------------ ----------- ------------ --------- ----------
<S> <C> <C> <C> <C>
AMLI at Park Place $13,000 12,807 8.21% October 1999
AMLI at Greenwood Forest 11,625 11,625 8.95% May 2002
AMLI at Champions Park 9,500 9,204 7.26% December 1997
AMLI at Champions Centre 6,700 6,700 8.93% January 2002
AMLI at Windbrooke 11,500 11,500 9.24% February 2002
AMLI at Willeo Creek 10,000 10,000 7.75% June 1996
AMLI at Pleasant Hill 15,500 6,850 9.15% March 2007
AMLI at Barrett Lakes 16,680 0 8.50% November 2009

<FN>
In general, these loans provide for monthly payments of principal and interest based on a 25 or 27 year
amortization schedule and a balloon payment at maturity. Loans against newly-completed properties provide for
payments of interest only for an initial period, with principal amortization commencing generally within two years
of completion of construction and initial lease-up.

At December 31, 1994 the Company, as general partner, owns co-investment partnership interests in Amli
Foundation Co-Investors, L.P. ("Foundation"), Amli at Champions, L.P. ("Champions"), and a nominal interest in
the GP Properties. These co-investment partnerships are accounted for using the equity method. Investments in
partnerships at December 31, 1994 and the Company's 1994 share of income or loss from each (excluding the GP
Properties) are summarized as follows:
</TABLE>
<TABLE>
<CAPTION>
EQUITY (DEFICIT)
--------------------
TOTAL COMPANY'S
PROPERTY (COMPANY'S TOTAL COMPANY'S COMPANY'S NET INCOME SHARE OF NET
PARTNERSHIP OWNERSHIP PERCENTAGEASSETS TOTAL SHARE INVESTMENT (LOSS) INCOME (LOSS)
- ----------- -------------------------- ----- --------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>

Foundation AMLI at Park
Place (25%) $20,421 7,722 1,930 1,891 352 88
Champions AMLI at Champions
Park (15%) 13,516 3,687 553 553 (73) (11)
Champions AMLI at Champions
Centre (15%) 10,127 3,357 504 504 (2) -
======= ===== ----- ----- ==== ----
$2,987 2,948 77
====== ===== ====
</TABLE>

INVESTMENTS IN SERVICE COMPANIES

In connection with the reorganization (June 1994 in the case of
Amrescon), the Company obtained 5% of the voting common stock and 100% of
the nonvoting preferred stock in the Service Companies, which provide
property management, construction, landscaping, investment advisory and
asset management services to the Company and to certain other parties. The
nonvoting preferred stock entitles the Company to approximately 95% of all
cash distributions from the Service Companies. For the years ended
December 31, 1995 and 1994, the Company received dividends of $40 and $100,
respectively, from the management company. In accordance with EITF Issue
95-6, the Company has changed the method of accounting for its investments
in the Service Companies to the equity method from the cost method
effective with the financial statements issued for the year ended December
31, 1995. The Company was required to restate its financial statements for
the year ended December 31, 1994 to conform to the 1995 presentation. The
effect of the restatement was not material in any year.

Summarized combined financial information of the various Service
Companies at and for the year ended December 31, 1995 and for the period
from February 15, 1994 through December 31, 1994 follows:

1995 1994

Income(1) $ 4,085 2,698
General and administrative expenses (3,335) (2,018)
------- -------
750 680

Interest (588) (407)
Depreciation (86) (52)
Income tax (29) (85)
------- --------

Net income $ 47 136
======= ========

Total assets $5,820 3,141
======= ========
(1) Net of construction and landscaping costs.

Interest expense of the Service Companies relates primarily to the 13%
notes payable by Amli Management Company and Amli Institutional Advisors,
Inc. to the Company. The Company's share of income from the Service
Companies in 1995 and 1994 was $3 and $100, respectively, after elimination
of intercompany profit on construction activities.

4. RELATED PARTY TRANSACTIONS

General and administrative expenses as included in the accompanying
consolidated statements of operations include allocations of costs to the
Company from Amli and its affiliates. Such allocations are not in excess
of Amli's cost of providing services to the Company, including personnel,
occupancy and other corporate overhead. Following the Initial Offering,
the majority of these costs are borne directly by the Company.
Approximately $335 and $512 was allocated to the Company and the Service
Companies from Amli's Service Bureau Division in the year ended December
31, 1995 and in the period from February 15 through December 31, 1994,
respectively, to reimburse Amli for the Company's allocated share of costs
incurred on its behalf. The management of the Company is of the opinion
that the costs allocated from Amli's Service Bureau Division reasonably
approximate or are less than the costs the Company would incur by
contracting for such services with an unaffiliated entity. The Company and
the Service Companies have agreed to pay for a share of Amli's total
occupancy cost. The Company's total occupancy cost was approximately $150
and $131 for year ended December 31, 1995 and the period from February 15
through December 31, 1994, respectively, including $122 and $107 allocable
to the Service Companies.

During 1995 and 1994 the Company accrued or paid to its affiliates fees
and other costs and expenses as follows:

1995 1994

Management fees $1,803 1,411
General contractor fees 285 17
Interest expense 30 26
Landscaping and ground maintenance 585 655
===== ======

During 1995 and 1994 the Company earned or received from its affiliates
other income as follows:

1995 1994

Development fees $338 -
Acquisition fees 240 307
Asset management fees 223 38
Accounting and administrative fees 29 173
Interest on advances 167 3
Interest on notes receivable 455 398
=== ===

During 1994, Amrescon purchased a total of 38 lumber futures contracts
in order to protect against increases in the cost of lumber to be used in
constructing new apartments. At December 31, 1995, Amrescon had reduced
its position to 6 contracts following acquisition of the lumber for several
of its construction projects. The remaining contracts were sold in
February 1996. Cumulative losses on these contracts totalled $68, which
amount is treated as an additional cost of properties developed in 1995.
Amrescon may resume using lumber futures in the future to protect against
increases in the cost of lumber as additional properties are developed.

5. DEBT

BOND FINANCING

Amli at Spring Creek, an 1,180-unit apartment community in Atlanta,
Georgia secures a total of $40,750 of tax-exempt bonds. The terms of the
bonds require that a portion of the apartment units be leased to
individuals who qualify based on income levels specified by the U.S.
Government. The bonds bear interest at a variable rate; however, $31,250
of the total $40,750 has an interest rate cap contract in place against
increases in a tax-exempt index rate ("TENR") above 3%. The variable rate
is adjusted weekly based upon the remarketing rate for these bonds (3.35 %
at February 20, 1996; 3.91% average for the year ended December 31, 1995).
The credit enhancement for the bonds was provided by a $41,297 five-year
letter of credit from Wachovia Bank which expires on October 15, 1999.

MORTGAGE NOTES PAYABLE TO FINANCIAL INSTITUTIONS

At December 31, 1995, Amli Residential Properties Trust owes a total of
$67,792 pursuant to nine fixed rate mortgage notes payable to seven
financial institutions. Each loan is secured by a first mortgage on the
respective residential apartment community and is non-recourse to the
partners, except for a $1,500 portion of one of the mortgage notes payable
and $13,776 of another of the mortgage notes payable. The loans bear
interest at fixed rates between 7% and 9.9%, with maturities extending
through September 1, 2005.

OTHER NOTES PAYABLE

Other notes payable are comprised of five floating rate loans due to
financial institutions aggregating $105,963 and $750 in another note
payable. These loans bear interest at rates of 150 to 200 basis points
over LIBOR (7.2% - 7.7% at December 31, 1995). Of the total, $12,400 is
the subject of an interest rate swap fixing the interest rate at 6.47%
through February 15, 1997. In addition, a total of $75,680 is covered by
interest rate caps for protection against increases in floating rate,
namely, a 30-day LIBOR cap above 3.875% on $54,835 through August 1, 1997;
a 7.5% LIBOR cap on $15,000 through April 1, 1997; and a 3.875% LIBOR cap
on $5,845 through February 15, 1998.

In April 1995, the Company closed on a $27,000 revolving credit and
construction loan facility with Citicorp Real Estate, Inc. This credit
facility will be used primarily to fund the development of AMLI at Autumn
Chase II and AMLI at Gleneagles II. On June 16, 1995, the line of credit
from Wachovia Bank was modified which increased its commitment to $50,000
from $35,000 and extended the maturity date on loans previously funded to
May 1998 from February 1997.

A portion of the Lehman Line of Credit was secured by Club Laguna. As
a result of the sale of Club Laguna on August 11, 1995 and its concurrent
release as security for the Lehman Line of Credit, the amount available on
the Lehman Line of Credit was reduced to $39,628 from $56,348.

Of the aggregate $186,443 of other notes payable, $16,000 is
outstanding on the $39,628 Lehman Line of Credit; $32,535 is outstanding on
the $50,000 Wachovia line of credit; $2,343 is outstanding on the $27,000
Citicorp facility; the entire $6,230 construction loan for AMLI at Regents
Center Phase III is available; and $250 in borrowing and $4,007 in letters
of credit are outstanding on an $8,000 line of credit from Harris. The
total $75,723 (net of $4,007 letters of credit) of unused credit is
available to fund future development, acquisition and working capital
needs. The line of credit agreements provide for customary borrower
covenants, including among other things, minimum debt service coverage
ratios and maximum loan to value ratios.

<TABLE>
The table below sets forth certain information relating to the indebtedness of the Company.
<CAPTION>
ORIGINAL BALANCE INTEREST MATURITY BALANCE
ENCUMBERED PROPERTIES AMOUNT AT 12/31/95 RATE DATE AT 12/31/94
- --------------------- ---------- ----------- -------- --------- -----------
<S> <C> <C> <C> <C> <C>
BOND FINANCING:
AMLI at Spring Creek $ 40,750 40,750 TENR+1.23% 10/1/24 40,750
-------- -------
MORTGAGE NOTES PAYABLE
TO FINANCIAL INSTITUTIONS:
AMLI at Alvamar 5,000 4,819 9.38% 3/1/97 4,865
AMLI at the Arboretum 4,800 4,504 9.90% 9/28/97 4,573
AMLI at Gleneagles 8,500 8,248 7.70% 10/31/97 8,336
AMLI at Martha's Vineyard 7,060 6,776 7.42% 11/1/97 6,875
AMLI at Reflections 4,800 4,615 7.50% 6/30/98 4,695
AMLI on Rosemeade 7,050 6,807 7.02% 10/5/98 6,924
AMLI at Sherwood 7,320 7,155 7.75% 7/1/03 7,307
AMLI at Valley Ranch 11,500 11,092 7.625% 7/10/03 11,270
AMLI at Regents Center 20,100 13,776 (1) 9/1/05 -
-------- ------- -------
Total Mortgage Notes Payable 76,130 67,792 54,845
-------- ------- -------
OTHER NOTES PAYABLE:
AMLI at Vinings
AMLI at Sope Creek Phase I, II & III
AMLI at Sope Creek Phase IV 50,000 32,535 L+1.50%(2) 5/31/98 19,518
-------- ------- ---------- ------- ------
AMLI at Autumn Chase I & II
AMLI at Chase Oaks
AMLI at Gleneagles Phase II 27,000 2,343 L+1.65%(3) 2/28/98 -
-------- ------- ---------- ------- ------
AMLI in Great Hills
AMLI at Bear Creek
AMLI at Nantucket
AMLI at Riverbend
AMLI at West Paces 54,835 54,835 5.76%(4) 8/9/01 54,835
-------- ------- --------- ------ ------
AMLI of North Dallas
AMLI at Beekman Place
AMLI on Timberglen
AMLI on the Green 39,628 16,000 L+1.85% 2/9/99 44,000
-------- ------- --------- ------ ------
AMLI at Park Sheridan 8,000 250 L+1.65%(5) 8/30/98 1,989
AMLI at Park Sheridan 6,230 - L+2.00% 10/9/96 -
AMLI at Pleasant Hill - - - - 1,000
Unsecured 750 750 4.00% Demand 750
-------- ------- -------
Total Other Notes Payable 186,443 106,713 122,092
-------- ------- -------
Total $303,323 215,255 217,687
======== ======= =======

<FN>
(1) $13,800 at 8.73%; $6,300 at 9.23% will not fund until late in 1996.
(2) Of the total $32,535 in borrowings, $8,775 relating to AMLI at Sope Creek Phase IV is at LIBOR + 1.75%
changing to LIBOR + 1.50% after achievement of certain net operating income levels as defined. The Company has
used interest rate derivative contracts to fix the interest rate at 6.47% through February 15, 1997 on $12,400, to
fix the interest rate at 6.65% through February 24, 1997 on $14,000 (6.90% on $8,775 of this amount until rate is
reduced to LIBOR + 1.50%), and to limit the interest rate to 5.38% through February 15, 1998 on $5,845.
(3) For amounts in excess of $15,425 borrowed under this facility, the rate will be LIBOR + 2.00% changing to
LIBOR + 1.85% after issuance of certificate of occupancy and to LIBOR + 1.65% after achievement of certain net
operating income levels as defined.
(4) Current LIBOR + 1.88% rate is capped at 5.76% until August 1, 1997, at which time loan bears fixed interest
at 8.35%.
(5) The interest rate will decrease to LIBOR + 1.50%, LIBOR + 1.375%, or LIBOR + 1.25% based on Company's S&P or
Moody's rating.

</TABLE>

As of December 31, 1995, the scheduled maturities of the Company's
debt are as follows:

FIXED RATE
MORTGAGE
NOTES PAYABLE OTHER
BOND TO INSURANCE NOTES
FINANCINGS COMPANIES PAYABLE TOTAL
---------- ------------- --------- --------

1996 . . . . . $ 0 1,007 3,417 4,424
1997 . . . . . 0 24,750 5,514 30,264
1998 . . . . . 0 11,530 41,035 52,565
1999 . . . . . 0 591 3,290 3,881
2000 . . . . . 0 639 678 1,317
Thereafter . . 40,750 29,275 52,779 122,804
------- ------ ------- -------
$40,750 67,792 106,713 215,255
======= ====== ======= =======

At December 31, 1995 and 1994, the carrying value and fair value of the
Company's long-term debt are not considered to be significantly different.
The Company considers the interest rates on its long-term debt as market
rates, based on interest rates, payment terms and maturities available to
the Company as of December 31, 1995 and 1994, for these types of loans.
Current estimates of fair value may differ significantly from the amount
presented herein. Certain outstanding debt at December 31, 1993 was repaid
at a discount of $1,209 during 1994 and prepayment penalties of
approximately $3,105 were incurred on other mortgage indebtedness that was
prepaid during 1994.

6. INCOME TAXES

The Company qualifies as a REIT under Sections 856 through 860 of the
Internal Revenue Code of 1986, as amended. A REIT will generally not be
subject to Federal income taxation on that portion of its income that
qualifies as REIT taxable income to the extent that it distributes at least
95 percent of its taxable income to its shareholders and complies with
certain other requirements. Accordingly, no provision has been made for
Federal income taxes for the Company. Approximately 35% of dividends paid
during 1995 represented a return of capital.

ARPG's combined financial statements include the accounts of the
Service Companies, which had been wholly-owned subsidiaries of Amli. The
accounts of these entities were included in the consolidated Federal income
tax return of Amli and its consolidated subsidiaries during the years from
inception through February 15, 1994. Income taxes were allocated to the
Service Companies on a stand-alone basis since 1988.

The Service Companies' combined income (loss) before income taxes
includes $168 for the one and one-half months ended February 14, 1994 and
$1,400 for the year ended December 31, 1993 subject to corporate income
tax.

Income tax expense allocated for the years ended December 31, 1994
(through February 15, 1994) and 1993 is as follows:

1994 1993
---- ----

Current:
Federal . . . . . . . . . . . . . . . . . . $57 595
State . . . . . . . . . . . . . . . . . . . 5 104
Deferred:
Federal . . . . . . . . . . . . . . . . . . - -
State . . . . . . . . . . . . . . . . . . . - -
--- ---
$62 699
=== ===

This provision for income tax differs from that computed by applying
the Federal statutory income tax rates to income before taxes primarily
because of state income taxes, net of their Federal income tax benefit.

7. COMMITMENTS AND CONTINGENCIES

LEASES OF OFFICE SPACE

The Company is a party to leases of office space with terms expiring
through 1998. These leases provide for payment of minimum rent and
additional rent based on increases in operating expenses.

The Company's annual share of the lease payments for noncancellable
office leases for 1995 and 1994 is $150, of which $122 is allocated to the
Service Companies. Thereafter, its share of such lease payments will be
adjusted based on prevailing market rates and actual space occupied. The
Company will be obligated for any additional space leased or utilized after
February 1994.

RETIREMENT SAVINGS PLAN

During 1985, ARPG established the Amli Realty Co. Retirement Savings
Plan (the "Retirement Plan"), a qualified plan under Section 401(k) of the
Internal Revenue Code. The provisions of the Retirement Plan obligate the
Company to contribute up to 50% of the amounts contributed to the
Retirement Plan by its employees (such contribution not to exceed $0.50 per
employee per year). Employees vest in Company contributions as follows:

Less than three years' service . . . . . . . . . . . . . 0%
Three or more years' service . . . . . . . . . . . . . . 100%
===

As of January 1, 1995, the Retirement Plan was amended to provide for
an additional contribution by Participating Employers, as defined, equal to
a percentage (3% for 1995) of each eligible employee's compensation. An
employee is eligible who has completed one year of service by and is an
employee as of either June 30 or December 31 of the year for which the
contribution is made. Those additional contributions together with the
Company's annual 50% matching contribution are to be invested (semi-
annually each February and August) in open market purchases of the
Company's common stock. Such contributions, by and on behalf of affiliates
of the Company, were $230, $45 and $38 in 1995, 1994 and 1993,
respectively.

BONUS INCENTIVE COMPENSATION

A bonus incentive compensation plan has been established for executive
and key officers. This program awards both a cash and a common share or OP
Unit bonus to executive officers and certain key officers covered under the
plan based on the achievement of specified targets and goals for the
Company and the individual officer. The primary targets are the desired
annual funds from operations ("FFO") per share and how the Company performs
relative to its competitors. The amount of cash bonus and number of common
shares or OP Units will be based on a formula determined for each officer
up to 50% of base compensation.

PERFORMANCE INCENTIVE PLAN

In 1995, the Company established a Performance Incentive Plan whereby
executive and key officers and employees may receive OP Units (or cash,
under certain circumstances) if a target growth in FFO is achieved for a
period of five years starting from the year the rights under this incentive
plan are granted. In 1995 a total of $76 was charged to expense by the
Company and the Service Companies pursuant to this incentive plan.

OPTION PLAN

The Company has adopted the Amli Residential Properties Option Plan
(the "Option Plan") to provide incentives to attract and retain Trustees,
officers and key employees and service providers. The Option Plan provides
for the grants of options to purchase a specified number of common shares
or OP Units ("Options"). Under the Option Plan, the total number of common
shares available for grant and available to be issued upon exchange of OP
Units issued under the Option Plan equals 1,000,000. Upon certain
extraordinary events, the Executive Compensation Committee may make such
adjustments in the aggregate number of common shares or OP Units reserved
for issuance, the number of common shares or OP Units covered by
outstanding awards and the exercise prices specified therein as they
determine to be appropriate.

Options for 464,500 common shares or OP Units have been granted at an
exercise price of $20.50 per share (i.e., the initial offering price).
Additional Options to acquire 47,500 shares at an average of $18.25 each
were awarded in January 1995 and 80,500 shares at $20.1875 per share were
awarded in January 1996. Such Options vest one-third each on the third,
fourth and fifth anniversary of the grant date, respectively, or
immediately in the event of a change in control of the Company.

LEGAL ACTIONS

The Company is a party to several legal actions which arose in the
normal course of business. In the opinion of management, there will be no
adverse consequences from these actions which would be material to the
Company's financial position or results of operations.

ACQUISITION ACTIVITIES

Through a separate account co-investment partnership with an
institutional investor, the Company has a contract to acquire a 592-unit
residential property located in Buffalo Grove, Illinois for the price of
approximately $45,050. The Company will contribute $5,351 for a 33%
interest in the partnership. Closing is anticipated to occur in March
1996.

DEVELOPMENT ACTIVITIES

The Company, as managing partner in Pleasant Hill Joint Venture, has
guaranteed a maximum development cost of $26,408 for AMLI at Pleasant Hill
apartments. In addition, as implementing member in Barrett Lakes Limited
Liability Company, the Company has the obligation to make capital
contributions to fund AMLI at Barrett Lakes development costs (as defined)
in excess of $26,993.

8. SUBSEQUENT EVENTS

Pursuant to the authority vested to the Board of Trustees in the
Declaration of Trust dated January 31, 1994, the Trustees classified and
designated 1,500,000 unissued shares of beneficial interest of the Company
as Series A cumulative convertible preferred shares of beneficial interest.

On January 30, 1996, the Company completed the sale of 1,200,000 newly
issued Series A convertible preferred shares, $.01 par value, for $24,000
in a registered offering. The price per share of $20 was the price of the
Company's common shares on January 15, 1996. The Company sold the
preferred shares directly to four institutional investors and Amli without
the use of a placement agent or underwriter. The proceeds from the sale of
these preferred shares, less $75 of transaction costs, were used to reduce
the Company's debt, fund development costs and for general corporate
purposes.

The preferred shares will pay a dividend equal to $1.72 per share on an
annual basis or the dividend amount paid on common shares, whichever is
higher. The Company's Board of Trustees has authorized the payment of
dividends at this annual rate for the period from January 30, 1996 to
February 20, 1996, the dividend payment date. The preferred shares are
perpetual and generally have no voting rights except in certain limited
circumstances. The preferred shares may be converted on a share-for-share
basis into common shares at any time at a conversion price that shall be
adjusted from time to time. After January 30, 2001, the Company may redeem
the preferred shares at its option for cash or common shares. The Company
may redeem the preferred shares for common shares only when the price of
the common shares equals or exceeds the conversion price for 20 of the 30
days preceding the date of redemption notice. The preferred shares and the
common shares into which the preferred shares may be converted have been
registered under the Company's existing shelf registration.

On February 29, 1996 Amli elected to convert its 100,000 Series A
convertible preferred shares into common shares.

On February 21, 1996, the Company entered into an interest rate swap
contract on $14,000 notional principal amount fixing the rate of that
amount of the Wachovia Bank floating rate debt at 6.65% (6.90% on $8,775 of
this amount until rate is reduced to LIBOR + 1.50%) through February 24,
1997.

On February 26, 1996, the Company closed on the acquisition of a land
parcel located in Aurora, Illinois. The purchase price included $3,536 in
cash and 26,182 OP Units. The Company intends to develop a 272-unit
apartment community on this land parcel. Total development costs are
projected to be approximately $24,000. Construction is anticipated to
start shortly after the acquisition. The Company anticipates entering into
a partnership with an institutional investor for the development of this
property.

On February 27, 1996, the Company, as lender, closed on a $12,955 loan
to an unrelated limited partnership for the development of a 156-unit
apartment community. The property is located in Overland Park, Kansas and
is currently under construction. The first loan draw for approximately
$2,113 was funded on the same date. The loan is secured by the land and
the improvements being constructed thereon. Under certain circumstances,
the Company would have the right to purchase the community following
completion and stabilization.

On February 28, 1996, the Company closed on the acquisition of a 78.5
acre land parcel located in Atlanta, Georgia for the price of $6,947. The
Company intends to develop an 800-unit apartment community on this land.
Construction is scheduled to begin in Spring 1996.

9. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

YEAR ENDED DECEMBER 31, 1995
----------------------------------
FIRST SECOND THIRD FOURTH

Revenues. . . . . . . . . . . . . . $18,213 18,539 18,661 18,464
Income (loss) before
minority interest and
extraordinary item. . . . . . . . 3,815 3,466 5,498 4,227
Minority interest . . . . . . . . . 761 669 1,051 806
Net income (loss) . . . . . . . . . 3,054 2,797 4,447 3,421
Earnings per share:
Income before extra-
ordinary
item. . . . . . . . . . . . . .$ .26 .24 .38 .30
Net income (loss) . . . . . . . . .26 .24 .38 .30

YEAR ENDED DECEMBER 31, 1994
----------------------------------
FIRST SECOND THIRD FOURTH

Revenues. . . . . . . . . . . . . . $15,017 15,984 16,563 17,651
Income (loss) before minority
interest and extraordinary item. . 1,625 3,329 4,816 3,628
Minority interest . . . . . . . . . 317 668 967 729
Extraordinary item (net of
minority interest) . . . . . . . . (2,102) - 21 74
Net income (loss) . . . . . . . . . (794) 2,661 3,870 2,973
Earnings per share:
Income before extra-
ordinary item . . . . . . . . . .$ .11* .23 .33 .25
Net income (loss) . . . . . . . . (.07)* .23 .33 .26

YEAR ENDED DECEMBER 31, 1993
----------------------------------
FIRST SECOND THIRD FOURTH

Revenues. . . . . . . . . . . . . . $11,200 11,724 12,689 12,921
Income (loss) before minority
interest and extraordinary item. . (324) (491) 623 (1,503)
Minority interest . . . . . . . . . - - - -
Extraordinary item. . . . . . . . . - - - -
Net income (loss) . . . . . . . . . (324) (491) 623 (1,503)

* One and one-half months subsequent to closing of the Initial Offering.

<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST SCHEDULE III

CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 1995
(Dollars in thousands)
<CAPTION>
GROSS AMOUNT
AT WHICH CARRIED
INITIAL COSTS (A) AT CLOSE OF PERIOD (B)
-------------------- ------------------------
COSTS DEPRECI-
RELATED BUILDINGS CAPITALIZED BUILDINGS ACCUMULATED DATE ABLE
ENCUM- AND IM- SUBSEQUENT TO AND IM- DEPRECIA- COMPLETED/ LIVES
PROPERTIES BRANCES(C) LAND PROVEMENTS ACQUISITION LAND PROVEMENTS TOTAL TION ACQUIRED YEARS
- ---------- ---------- ---- ------------------------ ---- ---------- ---------------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
DALLAS/FT. WORTH, TX
AMLI AT:
Autumn Chase $ 1,843 1,781 6,828 87 1,781 6,915 8,696 440 7/23/91 5-40 yrs
Bear Creek 6,600 2,601 8,979 209 2,601 9,188 11,789 534 12/5/89 5-40 yrs
Beekman Place 2,400 1,564 10,152 67 1,564 10,219 11,783 587 7/30/90 5-40 yrs
Chase Oaks 500 1,003 9,513 241 1,003 9,754 10,757 490 6/2/94 5-40 yrs
Gleneagles 8,248 1,578 10,954 169 1,578 11,123 12,701 2,542 7/1/88 5-40 yrs
The Green 4,160 1,693 17,007 151 1,693 17,158 18,851 1,030 2/16/94 5-40 yrs
Nantucket 6,050 1,931 6,817 88 1,931 6,905 8,836 1,991 12/16/88 5-40 yrs
North Dallas 7,200 5,714 27,052 245 5,714 27,297 33,011 1,512 7/31/89 5-40 yrs
Reflections 4,615 947 6,492 118 947 6,610 7,557 429 3/2/93 5-40 yrs
Rosemeade 6,807 1,534 9,182 138 1,534 9,320 10,854 545 12/28/90 5-40 yrs
Timberglen 2,240 1,932 8,094 76 1,932 8,170 10,102 489 7/9/90 5-40 yrs
Valley Ranch 11,092 3,139 16,199 176 3,139 16,375 19,514 937 5/25/90 5-40 yrs
------- ------ ------- ------ ------ ------- ------- -------
Subtotal -
Dallas/
Ft. Worth, TX 61,755 25,417 137,269 1,765 25,417 139,034 164,451 11,526
------- ------ ------- ------ ------ ------- ------- -------
AUSTIN, TX
AMLI AT:
Arboretum 4,504 1,664 9,480 68 1,664 9,548 11,212 1,683 6/4/865 - 40 yrs
Great Hills 9,075 3,228 14,304 174 3,228 14,478 17,706 848 1/18/915 - 40 yrs
Martha's
Vineyard 6,776 2,154 13,216 103 2,154 13,319 15,473 738 10/9/925 - 40 yrs
------- ------ ------- ------ ------ ------- ------- -------
Subtotal -
Austin, TX 20,355 7,046 37,000 345 7,046 37,345 44,391 3,269
------- ------ ------- ------ ------ ------- ------- -------
</TABLE>

<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST SCHEDULE III

CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 1995
(Dollars in thousands)
<CAPTION>
GROSS AMOUNT
AT WHICH CARRIED
INITIAL COSTS (A) AT CLOSE OF PERIOD (B)
-------------------- ------------------------
COSTS DEPRECI-
RELATED BUILDINGS CAPITALIZED BUILDINGS ACCUMULATED DATE ABLE
ENCUM- AND IM- SUBSEQUENT TO AND IM- DEPRECIA- COMPLETED/ LIVES
PROPERTIES BRANCES(C) LAND PROVEMENTS ACQUISITION LAND PROVEMENTS TOTAL TION ACQUIRED YEARS
- ---------- ---------- ---- ------------------------ ---- ---------- ---------------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ATLANTA, GA
AMLI AT:
Sope Creek 14,754 1,491 13,858 515 1,491 14,373 15,864 5,253 7/82-9/83 5-40 yrs
Sope Creek IV 8,775 1,856 8,958 36 1,888 8,962 10,850 109 9/1/83 5-40 yrs
Spring Creek 40,750 8,579 45,971 640 8,579 46,611 55,190 11,466 5/85-5/89 5-40 yrs
Vinings 9,006 1,490 9,576 69 1,490 9,645 11,135 663 6/19/92 5-40 yrs
West Paces 11,935 2,160 20,595 82 2,160 20,677 22,837 1,120 11/15/93 5-40 yrs
------- ------ ------- ------ ------ ------- ------- -------
Subtotal -
Atlanta, GA 85,220 15,576 98,958 1,342 15,608 100,268 115,876 18,611
------- ------ ------- ------ ------ ------- ------- -------
EASTERN KANSAS
AMLI AT:
Alvamar 4,819 727 6,983 133 727 7,116 7,843 248 10/18/94 5-40 yrs
Crown Colony 652 5,370 165 652 5,535 6,187 192 10/18/94 5-40 yrs
Regents Center 13,776 1,599 15,213 465 1,599 15,678 17,277 609 10/18/94 5-40 yrs
Sherwood 7,155 1,281 12,430 143 1,281 12,573 13,854 449 10/18/94 5-40 yrs
------- ------ ------- ------ ------ ------- ------- -------
Subtotal -
Overland, KS 25,750 4,259 39,996 906 4,259 40,902 45,161 1,498
------- ------ ------- ------ ------ ------- ------- -------
INDIANAPOLIS, IN
AMLI AT:
Riverbend 21,175 5,184 33,209 291 5,184 33,500 38,684 2,063 12/12/92 5-40 yrs
------- ------ ------- ------ ------ ------- ------- -------
CHICAGO, IL
AMLI AT:
Park Sheridan 250 1,101 9,458 181 1,101 9,639 10,740 2,156 8/31/89 5-40 yrs
------- ------ ------- ------ ------ ------- ------- -------
TOTAL
PROPERTIES 214,505 58,583 355,890 4,830 58,615 360,688 419,303 39,123
------- ------ ------- ------ ------ ------- ------- -------
</TABLE>

<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST SCHEDULE III

CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 1995
(DOLLARS IN THOUSANDS)
<CAPTION>
GROSS AMOUNT
AT WHICH CARRIED
INITIAL COSTS (A) AT CLOSE OF PERIOD (B)
-------------------- ------------------------
COSTS DEPRECI-
RELATED BUILDINGS CAPITALIZED BUILDINGS ACCUMULATED DATE ABLE
ENCUM- AND IM- SUBSEQUENT TO AND IM- DEPRECIA- COMPLETED/ LIVES
PROPERTIES BRANCES(C) LAND PROVEMENTS ACQUISITION LAND PROVEMENTS TOTAL TION ACQUIRED YEARS
- ---------- ---------- ---- ------------------------ ---- ---------- ---------------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
LAND PARCELS AND OTHER
AMLI AT:
Autumn Chase
Phase II 1,210 6,503 1,210 6,503 7,713 0 7/23/91
Autumn Chase
Phase III 1,323 175 1,323 175 1,498
Crown Colony
Phase II 325 48 325 48 373
Wells Branch 2,400 846 2,400 846 3,246 5/12/94
Gleneagles
Phase II 1,600 1,745 1,600 1,745 3,345 5/31/94
Regents Center
Phase III 661 817 661 817 1,478 10/18/94
Rosemeade
Phase II 1,166 92 1,166 92 1,258 11/30/94
Fossil Creek 1,489 112 1,489 112 1,601
River Park 2,400 299 2,400 299 2,699
Other 28 248 75 28 323 351 34 5-40 yrs
TOTAL LAND
PARCELS
AND OTHER 0 12,602 248 10,712 12,602 10,960 23,562 34
------- ------ ------- ------ ------ ------- ------- -------

TOTAL $214,505 71,185 356,138 15,542 71,217 371,648 442,865 39,157
======= ====== ======= ====== ====== ======= ======= =======

</TABLE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST SCHEDULE III

CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION

DECEMBER 31, 1995
(Dollars in thousands)

Notes:
(A) The initial costs represents the original development costs or original purchase price of the properties to the
Company, including closing costs.
(B) The aggregate cost of real estate owned at December 31, 1995 for Federal income tax purposes was $445,655.
(C) Amounts disclosed exclude current accrued interest and debt not secured by properties.
(D) Reconciliation of real estate owned:

<CAPTION>
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1993
------------ ------------ ------------
<S> <C> <C> <C>

Balance at beginning of period. . . . . . . . $451,762 338,895 263,877
Additions during period . . . . . . . . . . . 25,997 88,358 75,018
Effect of reorganization. . . . . . . . . . . - 24,509 -
Contribution to Joint Venture . . . . . . . . (5,608) - -
Sale of property. . . . . . . . . . . . . . . (29,286) - -
-------- -------- --------
Balance at end of period. . . . . . . . . . . $442,865 451,762 338,895
======== ======== ========

(E) Reconciliation of accumulated depreciation:

Balance at beginning of period. . . . . . . . $ 29,574 41,376 31,689
Additions during period . . . . . . . . . . . 10,785 10,627 9,687
Effect of reorganization. . . . . . . . . . . - (22,429) -
Sale of property. . . . . . . . . . . . . . . (1,202) - -
-------- -------- --------
Balance at end of period. . . . . . . . . . . $39,157 29,574 41,376
======== ======== ========

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

There were no changes of auditors during the fiscal years of 1995, 1994 or
1993.

</TABLE>