8-K

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549




                                    FORM 8-K

                                 CURRENT REPORT

     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

               Date of Report: (Date of Earliest Event Reported):
                         January 22, 2004 (January 21, 2004)





              AMERICAN INSURED MORTGAGE INVESTORS - SERIES 85, L.P.
             (Exact name of registrant as specified in its charter)

        California                      1-11059                  13-3257662
(State or other jurisdiction          (Commission             (I.R.S. Employer
     of incorporation)                File Number)           Identification No.)







                              11200 Rockville Pike
                            Rockville, Maryland 20852
   (Address of principal executive offices, including zip code, of Registrant)

                                 (301) 816-2300
              (Registrant's telephone number, including area code)



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Item 5.  Other Events.

     Attached  as an  exhibit  to this  Current  Report  on Form  8-K is a press
release  issued by the  General  Partner  on January  21,  2004  announcing  the
November  distribution to the  Partnership's  unitholders.  The above referenced
press release is incorporated by reference herein.


Item 7.  Financial Statements, Pro Forma Financial Information and Exhibits.

(c)  Exhibits. The following exhibits are filed with this report:

     Exhibit 99.1 - Press Release dated January 21, 2004.





SIGNATURE

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



                                                    AMERICAN INSURED MORTGAGE
                                                    INVESTORS - SERIES 85, L.P.

                                                    By: CRIIMI, Inc.
                                                        General Partner


Dated: January 22, 2004                             By:/s/ Mark A. Libera
                                                    -------------------------
                                                       Mark A. Libera
                                                       Vice President
                                                       Senior Corporate Counsel

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                                  EXHIBIT INDEX

Exhibit
No.                                Description
- --------------------------------------------------------------------------------

*    99.1 Press Release dated January 21, 2004.

*    Filed herewith.

EX-99

Contact:    Susan B. Railey
            (301) 468-3120                     EXHIBIT 99.1
            Sharon Bramell                     FOR IMMEDIATE RELEASE
            (301) 231-0351


                      AIM 85 DECLARES MONTHLY DISTRIBUTION
                         FOR JANUARY OF $1.145 PER UNIT

                 Includes Mortgage Proceeds of $ 1.125 Per Unit


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


     ROCKVILLE,  MD,  January 21,  2004 --  (AMEX/AII)  The  general  partner of
American  Insured  Mortgage  Investors - Series 85, L.P. (AIM 85) today declared
the  monthly  distribution  for  January  2004 in the amount of $1.145 per unit.
Holders of record on January  31, 2004 will  receive  this amount as part of the
first quarter distribution which will be paid on May 3, 2004.

The January distribution of $1.145 per unit includes the following:

     o    2 cents per unit regular cash flow;
     o    57 cents per unit mortgage proceeds due to the prepayment of the
          mortgage on Pleasant View Nursing Home;
     o    13.5 cents per unit mortgage proceeds due to the prepayment of the
          mortgage on Stone Hedge Village Apartments; and
     o    42 cents  per  unit of  mortgage  proceeds  due to the  redemption  of
          debentures  issued by HUD in exchange  for the  mortgages  on Baypoint
          Shoreline  Apartments,  College Green Apartments,  Brougham Estates II
          and Town Park Apartments.

     Record dates for the AIM 85  distributions  occur at the end of each month.
Distributions  are paid  approximately  one month after the end of each calendar
quarter and include the three amounts declared during the quarter.

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