UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

Form 10-QSB

(Mark One)

[X]

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2007

[ ]

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _________to _________

Commission file number 0-14570

MCCOMBS REALTY PARTNERS

(Exact name of small business issuer as specified in its charter)

   California

33-0068732

(State or other jurisdiction of

   (I.R.S. Employer

 incorporation or organization)

  Identification No.)

55 Beattie Place, PO Box 1089

Greenville, South Carolina  29602

(Address of principal executive offices)

(864) 239-1000

(Issuer's telephone number)

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes __ No   X_

PART I – FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

MCCOMBS REALTY PARTNERS

CONSOLIDATED STATEMENT OF NET ASSETS IN LIQUIDATION

(Unaudited)

(in thousands)

June 30, 2007

Assets
Cash and cash equivalents	$  4,104
Receivables and deposits	155
	4,259
Liabilities
Accounts payable	155
Other liabilities	3
Due to affiliates (Note D)	351
Estimated costs during the period of liquidation
(Note B)	79
	588
Net assets in liquidation	$  3,671

See Accompanying Notes to Consolidated Financial Statements

MCCOMBS REALTY PARTNERS

CONSOLIDATED STATEMENTS OF DISCONTINUED OPERATIONS

(Unaudited)

 (in thousands, except per unit data)

	Three Months Ended		Six Months Ended
	June 30,		June 30,
	2007	2006	2007	2006
Income from continuing operations	$     --	$    --	$     --	$    --
Loss from discontinued operations (Note A):
Revenues
Rental income	357	330	706	617
Other income	59	49	116	93
Total revenues	416	379	822	710
Expenses
Operating	263	223	495	435
General and administrative	30	34	57	64
Depreciation	77	70	154	140
Interest	152	145	302	279
Property taxes	18	19	36	37
Total expenses	540	491	1,044	955
Loss from discontinued operations	(124)	(112)	(222)	(245)
Gain on sale of discontinued operations
(Note E)	8,623	--	8,623	--
Net income (loss)	$  8,499	$  (112)	$  8,401	$  (245)
Net income (loss) allocated to general
Partners	$      1	$    --	$      1	$    --
Net income (loss) allocated to limited
Partners	8,498	(112)	8,400	(245)
	$  8,499	$  (112)	$  8,401	$  (245)
Per limited partnership unit:
Loss from discontinued
operations	$  (7.23)	$ (6.52)   --	$ (12.94)	$(14.27)
Gain on sale of discontinued
operations	502.57	--	502.57	--
Net income (loss) per limited
partnership unit	$ 495.34	$ (6.52)	$ 489.63	$(14.27)

See Accompanying Notes to Consolidated Financial Statements

MCCOMBS REALTY PARTNERS

CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' (DEFICIT) CAPITAL/NET

ASSETS IN LIQUIDATION

(Unaudited)

(in thousands, except unit data)

	Limited
	Partnership	General	Limited
	Units	Partner	Partners	Total
Partners' deficit
at December 31, 2006	17,155.93	$   (1)	$ (4,650)	$(4,651)
Net income for the six months
ended June 30, 2007	--	1	8,400	8,401
Partners' capital
at June 30, 2007	17,155.93	$    --	$ 3,750	3,750
Adjustment to liquidation basis
(Note B)				(79)
Net assets in liquidation at
June 30, 2007				$ 3,671

See Accompanying Notes to Consolidated Financial Statements

MCCOMBS REALTY PARTNERS

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)

	Six Months Ended
	June 30,
	2007	2006
Cash flows from operating activities:
Net income (loss)	$8,401	$ (245)
Adjustments to reconcile net income (loss) to net cash
(used in) provided by operating activities:
Depreciation	154	140
Amortization of loan costs	22	31
Bad debt expense	19	24
Loss on extinguishment of debt	3	--
Gain on sale of discontinued operations	(8,623)	--
Change in accounts:
Receivables and deposits	(23)	(78)
Other assets	35	(3)
Accounts payable	63	16
Tenant security deposit liabilities	(50)	14
Accrued property taxes	--	37
Other liabilities	(65)	--
Due to affiliates	(221)	118
Net cash (used in) provided by operating activities	(285)	54
Cash flows from investing activities:
Property improvements and replacements	(97)	(92)
Net withdrawals from restricted escrow	92	2
Net proceeds from sale of discontinued operations	10,298	--
Net cash provided by (used in) investing activities	10,293	(90)
Cash flows from financing activities:
Advances from affiliate	--	64
Repayment of advances from affiliate	(1,647)	--
Repayment of mortgage note payable	(4,350)	--
Net cash (used in) provided by financing activities	(5,997)	64
Net increase in cash and cash equivalents	4,011	28
Cash and cash equivalents at beginning of period	93	16
Cash and cash equivalents at end of period	$4,104	$   44
Supplemental disclosure of cash flow information:
Cash paid for interest	$  532	$  155
Supplemental disclosure of non-cash activity:
Property improvements and replacements in accounts
payable	$   16	$   35

Included in property improvements and replacements for the six months ended June 30, 2007 and 2006 are approximately $37,000 and $22,000, respectively, of property improvements and replacements which were included in accounts payable at December 31, 2006 and 2005, respectively.

See Accompanying Notes to Consolidated Financial Statements

MCCOMBS REALTY PARTNERS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note A – Basis of Presentation

As of June 30, 2007, McCombs Realty Partners (the “Partnership” or “Registrant”) adopted the liquidation basis of accounting due to the sale of its remaining investment property (as discussed in “Note E – Disposition of Investment Property”. The general partner responsible for management of the Partnership’s business is CRPTEX, Inc., a Texas corporation (the “General Partner”). The General Partner is a subsidiary of Apartment Investment and Management Company (“AIMCO”), a publicly traded real estate investment trust.

As a result of the decision to liquidate the Partnership, the Partnership changed its basis of accounting for its consolidated financial statements at June 30, 2007, to the liquidation basis of accounting.  Consequently, assets have been valued at estimated net realizable value and liabilities are presented at their estimated settlement amounts, including estimated costs associated with carrying out the liquidation of the Partnership. The valuation of assets and liabilities necessarily requires many estimates and assumptions and there are substantial uncertainties in carrying out the liquidation. The actual realization of assets and settlement of liabilities could be higher or lower than amounts indicated and is based upon the General Partner’s estimates as of the date of the consolidated financial statements.

The General Partner estimates that the liquidation process will be completed by June 30, 2008.  Because the success in realization of assets and the settlement of liabilities, is based on the General Partner’s best estimates, the liquidation period may be shorter than projected or it may be extended beyond the projected date of liquidation.

The accompanying unaudited consolidated financial statements of the Partnership have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  In the opinion of the General Partner, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.  For further information, refer to the consolidated financial statements and footnotes included in the Partnership’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2006.

In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, the accompanying consolidated statements of discontinued operations for both the three and six months ended June 30, 2007 and 2006 are presented to reflect the operations of the Partnership’s investment property as discontinued operations as a result of the sale of the investment property on June 29, 2007.

Note B – Adjustment to Liquidation Basis of Accounting

In accordance with the liquidation basis of accounting, at June 30, 2007, assets were adjusted to their estimated net realizable value and liabilities were adjusted to their estimated settlement amount. The net adjustment required to convert to the liquidation basis of accounting was a decrease in net assets of approximately $79,000, which is included in the Consolidated Statement of Changes in Partners’ (Deficit) Capital/Net Assets in Liquidation. The net adjustments are summarized as follows:

Decrease in

Net Assets

(in thousands)

Adjustment of other assets and liabilities, net $  79

Note C – Plan of Reorganization

On March 9, 1987, the original general partners of the Partnership, on behalf of the Partnership, filed a voluntary petition under Chapter 11 of the Federal Bankruptcy Code in U.S. Bankruptcy Court, Central District of California ("Court").  The Partnership continued as Debtor-In-Possession to operate its business in the ordinary course until the Court confirmed the Partnership's Plan of Reorganization (the “Plan”) effective October 25, 1988.  The Plan was approved by all required classes of creditors.

The Plan required that the Partnership make certain payments to its secured creditors and others on or before October 20, 1995.  These payments were made on or about June 25, 1995, when the Partnership refinanced the outstanding mortgages encumbering the property.  The Plan also required that the Partnership make the following distributions on October 20, 1998, from available cash:

1)

First, Limited Partners, both original and substitute, who made additional capital contributions under the Plan would receive a repayment of the additional contributions totaling approximately $730,000; if sufficient funds were unavailable to fully satisfy this amount then a pro-rata portion would be paid based upon available funds;

2)

Second, Class 12 unsecured creditors ($23,100) would be paid on their claims;

3)

Third, Limited Partners who made additional capital contributions and were original Limited Partners would receive a repayment of their original capital contributions totaling approximately $9,818,000; if sufficient funds were unavailable to fully satisfy this amount then a pro-rata portion of available cash less a pro-rata portion reserved for one third of the existing capital contributions of non-contributing Limited Partners would be paid based upon available funds;

4)

Fourth, Limited Partners who did not make additional capital contributions would receive a repayment of one-third of their original capital contributions (i.e., one-third of $1,200,000); if sufficient funds were unavailable to fully satisfy this amount then a pro-rata portion would be paid based upon available funds.

Additionally, the Plan required CRPTEX, Inc. to make a capital contribution of $14,500 and loan an additional $117,500 on behalf of the Partnership.  The Partnership received the $14,500 capital contribution but did not receive or require the additional $117,500 to be loaned.

The payments required by number 2 above were timely made.  With respect to the amounts due to the Limited Partners under numbers 1, 3, and 4 above, there were not sufficient funds available to completely satisfy these obligations at October 20, 1998.

It was not anticipated that at October 20, 1998, there would be available funds to fully satisfy the unsecured claims of the Limited Partners, as indicated under the Plan.  The limited partners were approached in August 1998 and asked to either approve a sale of the Partnership’s sole investment property or for the General Partner to petition the Bankruptcy Court for an extension of the settlement date.   The required fifty-one percent response was not received. As a result, the Partnership did not make any payments to the Limited Partners on October 20, 1998, as required by the Plan from available funds.  There was no requirement, however, that the Partnership sell or again refinance the property in order to pay in part or in whole, the payments to the Limited Partners referred to above.  The General Partner has determined that although all of the required payments due under the Plan to the Limited Partners were not m ade, that the Partnership is not in any material financial default in connection with its prior bankruptcy.  In addition, the General Partner believed that it was proper for the Partnership to continue operating under the terms of its Partnership Agreement as modified by the Plan.

Since the expiration of the Plan on October 20, 1998, the General Partner had reserved all excess cash to ensure that the Partnership would be able to meet its operating and capital improvement needs rather than making pro-rata payments to the limited partners in accordance with numbers 1, 3, and 4 above.  During the fourth quarter of 2001, the General Partner determined that the Partnership had accumulated approximately $562,000 in excess funds.  Approximately $530,000, which had been reserved since 1998 to ensure that the property was fully able to meet its operating and capital improvement needs with existing operating funds, was distributed during the year ended December 31, 2002 in accordance with number 1 above.  In addition, approximately $32,000 was distributed from operations during the year ended December 31, 2002.  Any additional funds will be distributed in accordance with the terms of the Partnership Agreement as mo dified by the Plan.

Subsequent to June 30, 2007, the Partnership distributed approximately $2,996,000 of sales proceeds to the limited partners in accordance with numbers 1, 3 and 4 above. The distribution was allocated among both the contributing and non-contributing limited partners in the amount of approximately $2,636,000 ($179.17 per unit) and $360,000 ($147.41 per unit) respectively.

Note D - Transactions with Affiliated Parties

The Partnership has no employees and depends on the General Partner and its affiliates for the management and administration of all Partnership activities.  The Partnership Agreement provides for certain payments to affiliates for services and for reimbursement of certain expenses incurred by affiliates on behalf of the Partnership.  

Affiliates of the General Partner received 5% of gross receipts from the Partnership's investment property as compensation for providing property management services.  The Partnership paid to such affiliates approximately $41,000 and $34,000 for the six months ended June 30, 2007 and 2006, respectively, which are included in operating expenses on the accompanying consolidated statements of discontinued operations.

Affiliates of the General Partner charged the Partnership for reimbursement of accountable administrative expenses amounting to approximately $31,000 and $25,000 for the six months ended June 30, 2007 and 2006 and are included in general and administrative expenses on the accompanying consolidated statements of discontinued operations. Approximately $351,000 in reimbursement of accountable administrative expenses, including related accrued interest of approximately $58,000, was owed to affiliates of the General Partner at June 30, 2007 and is included in due to affiliates on the accompanying Consolidated Statement of Net Assets in Liquidation. This amount was paid in full subsequent to June 30, 2007 with funds from the sale of the property.

In accordance with the Partnership Agreement, during the six months ended June 30, 2006 an affiliate of the General Partner advanced the Partnership approximately $64,000 to fund operating expenses. There were no such advances during the six months ended June 30, 2007.  Advances bear interest at the prime rate plus 2% (10.25% at June 30, 2007).  Interest expense for the six months ended June 30, 2007 and 2006 was approximately $99,000 and $83,000, respectively. During the six months ended June 30, 2007, advances and accrued interest of approximately $2,013,000 were repaid. There were no such payments during the six months ended June 30, 2006.

The Partnership insured its property up to certain limits through coverage provided by AIMCO which is generally self-insured for a portion of losses and liabilities related to workers’ compensation, property casualty, general liability and vehicle liability.  The Partnership insured its property above the AIMCO limits through insurance policies obtained by AIMCO from insurers unaffiliated with the General Partner. During the six months ended June 30, 2007, the Partnership was charged by AIMCO and its affiliates approximately $59,000 for hazard insurance coverage and fees associated with policy claims administration.  The Partnership was charged by AIMCO and its affiliates approximately $44,000 for insurance coverage and fees associated with policy claims administration during the year ended December 31, 2006.

Note E – Disposition of Investment Property

On June 29, 2007, the Partnership sold its last remaining investment property, Lakewood at Pelham Apartments, to a third party. In addition to Lakewood at Pelham Apartments, affiliates of the third party also purchased nine other apartment properties; all of which were owned by entities affiliated with AIMCO Properties, L.P., an affiliate of the General Partner of the Partnership. The total sales price for all ten apartment properties was $95,800,000 of which $10,350,000 represents the portion of the sales price allocated to Lakewood at Pelham Apartments.  

The net proceeds realized by the Partnership for Lakewood at Pelham Apartments were approximately $10,298,000 after payment of closing costs.  The Partnership used approximately $4,350,000 of the net proceeds to repay the mortgage encumbering the property.  The Partnership realized a gain of approximately $8,623,000 as a result of the sale.  The property’s operations of approximately $222,000 and $245,000 are shown as loss from discontinued operations and include revenues of approximately $822,000 and $710,000 for the six months ended June 30, 2007 and 2006, respectively.  In addition, the Partnership recorded a loss on extinguishment of debt of approximately $3,000 as a result of the write-off of unamortized loan costs.  This amount is included in interest expense on the accompanying Consolidated Statements of Discontinued Operations for the three and six months ended June 30, 2007.

Note F - Contingencies

The Partnership is unaware of any pending or outstanding litigation matters involving it or its investment property that are not of a routine nature arising in the ordinary course of business.

Environmental

Various Federal, state and local laws subject property owners or operators to liability for management, and the costs of removal or remediation, of certain hazardous substances present on a property. Such laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release or presence of the hazardous substances. The presence of, or the failure to manage or remedy properly, hazardous substances may adversely affect occupancy at affected apartment communities and the ability to sell or finance affected properties. In addition to the costs associated with investigation and remediation actions brought by government agencies, and potential fines or penalties imposed by such agencies in connection therewith, the presence of hazardous substances on a property could result in claims by private plaintiffs for personal injury, disease, disability or other infirmities. Various laws also impose liability for the cost of removal, remediation or disposal of hazardous substances through a licensed disposal or treatment facility. Anyone who arranges for the disposal or treatment of hazardous substances is potentially liable under such laws. These laws often impose liability whether or not the person arranging for the disposal ever owned or operated the disposal facility. In connection with the ownership, operation and management of its property, the Partnership could potentially be liable for environmental liabilities or costs associated with its property.  

Mold

The Partnership is aware of lawsuits against owners and managers of multifamily properties asserting claims of personal injury and property damage caused by the presence of mold, some of which have resulted in substantial monetary judgments or settlements.  The Partnership has only limited insurance coverage for property damage loss claims arising from the presence of mold and for personal injury claims related to mold exposure.  Affiliates of the General Partner have implemented policies, procedures, third-party audits and training and the General Partner believes that these measures will prevent or eliminate mold exposure and will minimize the effects that mold may have on residents.  To date, the Partnership has not incurred any material costs or liabilities relating to claims of mold exposure or to abate mold conditions.  Because the law regarding mold is unsettled and subject to change the General Partner can make no assura nce that liabilities resulting from the presence of or exposure to mold will not have a material adverse effect on the Partnership’s consolidated financial condition or results of operations.

ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The matters discussed in this report contain certain forward-looking statements, including, without limitation, statements regarding future financial performance and the effect of government regulations. Actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors including, without limitation: national and local economic conditions; the terms of governmental regulations that affect the Registrant and interpretations of those regulations; litigation, including costs associated with prosecuting and defending claims and any adverse outcomes, and possible environmental liabilities. Readers should carefully review the Registrant's financial statements and the notes thereto, as well as the risk factors described in the documents the Registrant files from time to time with the Securities and Exchange Commission.

Results of Operations

As of June 30, 2007, the Partnership adopted the liquidation basis of accounting, due to the sale of its remaining investment property, Lakewood at Pelham Apartments, on June 29, 2007. In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, the accompanying consolidated statements of discontinued operations for both the three and six months ended June 30, 2007 and 2006 are presented to reflect the operations of the Partnership’s investment property as discontinued operations as a result of the sale of the investment property on June 29, 2007. Prior to adopting the liquidation basis of accounting, the Partnership’s net income was approximately $8,499,000 and $8,401,000 for the three and six months ended June 30, 2007 compared to net losses of approximately $112,000 and $245,000 for the three and six months ended June 30, 2006. &nb sp;The increase in net income for both periods is primarily due to a gain on sale of discontinued operations in 2007.

On June 29, 2007, the Partnership sold its last remaining investment property, Lakewood at Pelham Apartments, to a third party. In addition to Lakewood at Pelham Apartments, affiliates of the third party also purchased nine other apartment properties; all of which were owned by entities affiliated with AIMCO Properties, L.P., an affiliate of the General Partner of the Partnership. The total sales price for all ten apartment properties was $95,800,000 of which $10,350,000 represents the portion of the sales price allocated to Lakewood at Pelham Apartments.  

The net proceeds realized by the Partnership for Lakewood at Pelham Apartments was approximately $10,298,000 after payment of closing costs.  The Partnership used approximately $4,350,000 of net proceeds to repay the mortgage encumbering the property.   The Partnership realized a gain of approximately $8,623,000 as a result of the sale.  The property’s operations of approximately $222,000 and $245,000 are shown as loss from discontinued operations and include revenues of approximately $822,000 and $710,000 for the six months ended June 30, 2007 and 2006, respectively. In addition, the Partnership recorded a loss on extinguishment of debt of approximately $3,000 as a result of the write-off of unamortized loan costs. This amount is included in interest expense on the accompanying Consolidated Statements of Discontinued Operations for the three and six months ended June 30, 2007.

Excluding the impact of the gain on sale of discontinued operations in 2007, the Partnership’s loss from discontinued operations was approximately $124,000 and $222,000 for the three and six months ended June 30, 2007 respectively, as compared to loss from discontinued operations of approximately $112,000 and $245,000 for the three and six months ended June 30, 2006 respectively.  The increase in loss from discontinued operations for the three months ended June 30, 2007 is due to an increase in total expenses partially offset by an increase in total revenues.  The decrease in loss from continuing operations for the six months ended June 30, 2007 is due to an increase in total revenues partially offset by an increase in total expenses.

Total revenues increased for both the three and six months ended June 30, 2007 due to increases in both rental and other income at Lakewood at Pelham Apartments.  Rental income increased at Lakewood at Pelham Apartments due to an increase in occupancy, an increase in the average rental rate and a decrease in bad debt expense.  Other income increased for both the three and six months ended June 30, 2007 due to an increase in tenant utility reimbursements.

Total expenses increased for both the three and six months ended June 30, 2007 primarily due to an increase in operating, depreciation, and interest expenses, partially offset by a decrease in general and administrative expense. Property tax expense remained comparable for both periods.  Operating expense increased for the three months ended June 30, 2007 due to an increase in property expense and an accrual of costs associated with the sale of the property. Operating expense increased for the six months ended June 30, 2007 due to increases in administrative and management fee expenses. Property expense increased for the three months ended June 30, 2007 due to an increase in salaries and related benefits. Administrative expense increased for the six months ended June 30, 2007 due to an increase in training and travel and personnel costs. Management fees increased due to an increase in rental income on which such fee is based. Depreciation expe nse increased for both the three and six months ended June 30, 2007 as a result of property improvements and replacements placed into service over the past twelve months at the investment property. Interest expense increased for both periods due to an increase in interest on advances from an affiliate of the General Partner due to a higher average outstanding balance and an increase in the interest rate charged on such advances, and due to an increase in the variable interest rate on the mortgage encumbering the investment property.

General and administrative expense decreased for the three and six months ended June 30, 2007 due to a decrease in professional services and legal expenses partially offset by an increase in management reimbursements to the General Partner as allowed under the Partnership Agreement. Also included in general and administrative expenses for the three and six months ended June 30, 2007 and 2006 are costs associated with the quarterly and annual communications with investors and regulatory agencies and the annual audit required by the Partnership Agreement.

Liquidity and Capital Resources

The Partnership expects to liquidate by June 30, 2008 due to the sale of its remaining investment property (see “Note B” to the consolidated financial statements included in “Item 1. Financial Statements”).

At June 30, 2007, the Partnership had cash and cash equivalents of approximately $4,104,000 compared to approximately $44,000 at June 30, 2006.  Cash and cash equivalents increased approximately $4,011,000 since December 31, 2006 due to approximately $10,293,000 of cash provided by investing activities partially offset by approximately $5,997,000 and $285,000 of cash used in financing and operating activities, respectively. Cash provided by investing activities consisted of net proceeds from the sale of Lakewood at Pelham Apartments and net withdrawals from escrow accounts maintained by the mortgage lender partially offset by property improvements and replacements. Cash used in financing activities consisted of repayment of advances from affiliates and repayment of the mortgage note payable as a result of the sale of Lakewood at Pelham Apartments. The Partnership invests its working capital reserves in interest bearing accounts.

During the six months ended June 30, 2007, the Partnership completed approximately $76,000 of capital improvements at Lakewood at Pelham Apartments, consisting primarily of floor covering, water heater and appliance replacements. These improvements were funded from operating cash flow and replacement reserves. The property was sold to a third party on June 29, 2007.

As a result of the decision to liquidate the Partnership, the Partnership changed its basis of accounting for its consolidated financial statements at June 30, 2007, to the liquidation basis of accounting.  Consequently, assets have been valued at estimated net realizable value and liabilities are presented at their estimated settlement amounts, including estimated costs associated with carrying out the liquidation of the Partnership. The valuation of assets and liabilities necessarily requires many estimates and assumptions and there are substantial uncertainties in carrying out the liquidation. The actual realization of assets and settlement of liabilities could be higher or lower than amounts indicated and is based upon estimates of the General Partner as of the date of the financial statements.

In accordance with the liquidation basis of accounting, at June 30, 2007, assets were adjusted to their estimated net realizable value and liabilities were adjusted to their estimated settlement amount. The net adjustment required to convert to the liquidation basis of accounting was a decrease in net assets of approximately $79,000, which is included in the Consolidated Statement of Changes in Partners’ (Deficit) Capital/Net Assets in Liquidation. The net adjustments are summarized as follows:

	Decrease in
	Net Assets
	(in thousands)
Adjustment of other assets and liabilities, net	$  79

On March 9, 1987, the original general partners of the Partnership, on behalf of the Partnership, filed a voluntary petition under Chapter 11 of the Federal Bankruptcy Code in U.S. Bankruptcy Court, Central District of California ("Court").  The Partnership continued as Debtor-In-Possession to operate its business in the ordinary course until the Court confirmed the Partnership's Plan of Reorganization (The "Plan") effective October 25, 1988.  The Plan was approved by all required classes of creditors.

The Plan required that the Partnership make certain payments to its secured creditors and others on or before October 20, 1995.  These payments were made on or about June 25, 1995, when the Partnership refinanced the outstanding mortgages encumbering the property.  The Plan also required that the Partnership make the following distributions on October 20, 1998, from available cash:

1)

First, Limited Partners, both original and substitute, who made additional capital contributions under the Plan would receive a repayment of the additional contributions totaling approximately $730,000; if sufficient funds were unavailable to fully satisfy this amount then a pro-rata portion would be paid based upon available funds;

2)

Second, Class 12 unsecured creditors ($23,100) would be paid on their claims;

3)

Third, Limited Partners who made additional capital contributions and were original Limited Partners would receive a repayment of their original capital contributions totaling approximately $9,818,000; if sufficient funds were unavailable to fully satisfy this amount then a pro-rata portion of available cash less a pro-rata portion reserved for one third of the existing capital contributions of non-contributing Limited Partners would be paid based upon available funds;

4)

Fourth, Limited Partners who did not make additional capital contributions would receive a repayment of one-third of their original capital contributions (i.e., one-third of $1,200,000); if sufficient funds were unavailable to fully satisfy this amount then a pro-rata portion would be paid based upon available funds.

Additionally, the Plan required CRPTEX, Inc. to make a capital contribution of $14,500 and loan an additional $117,500 on behalf of the Partnership.  The Partnership received the $14,500 capital contribution but did not receive or require the additional $117,500 to be loaned.

The payments required by number 2 above were timely made.  With respect to the amounts due to the Limited Partners under numbers 1, 3, and 4 above, there were not sufficient funds available to completely satisfy these obligations at October 20, 1998.

It was not anticipated that at October 20, 1998, there would be available funds to fully satisfy the unsecured claims of the Limited Partners, as indicated under the Plan.  The limited partners were approached in August 1998 and asked to either approve a sale of the Partnership’s sole investment property or for the General Partner to petition the Bankruptcy Court for an extension of the settlement date.   The required fifty-one percent response was not received. As a result, the Partnership did not make any payments to the Limited Partners on October 20, 1998, as required by the Plan from available funds.  There was no requirement, however, that the Partnership sell or again refinance the property in order to pay in part or in whole, the payments to the Limited Partners referred to above.  The General Partner has determined that although all of the required payments due under the Plan to the Limited Partners were not m ade, that the Partnership is not in any material financial default in connection with its prior bankruptcy.  In addition, the General Partner believed that it was proper for the Partnership to continue operating under the terms of its Partnership Agreement as modified by the Plan.

Since the expiration of the Plan on October 20, 1998, the General Partner had reserved all excess cash to ensure that the Partnership would be able to meet its operating and capital improvement needs rather than making pro-rata payments to the limited partners in accordance with numbers 1, 3, and 4 above.  During the fourth quarter of 2001, the General Partner determined that the Partnership had accumulated approximately $562,000 in excess funds.  Approximately $530,000 which had been reserved since 1998 to ensure that the property was fully able to meet its operating and capital improvement needs with existing operating funds, was distributed during the year ended December 31, 2002 in accordance with number 1 above. In addition, approximately $32,000 was distributed from operations during the year ended December 31, 2002. Any additional funds will be distributed in accordance with the terms of the Partnership Agreement as modified by the Plan.

There were no distributions paid during the six months ended June 30, 2007 and 2006. Subsequent to June 30, 2007, the Partnership distributed approximately $2,996,000 of sales proceeds to the limited partners in accordance with numbers 1, 3 and 4 above. The distribution was allocated among both the contributing and non-contributing limited partners in the amount of approximately $2,636,000 ($179.17 per unit) and $360,000 ($147.41 per unit), respectively. The Partnership’s cash available for distribution will be reviewed on a quarterly basis. Future cash distributions will depend on the amount of cash remaining after fully liquidating the Partnership.

Other

In addition to its indirect ownership of the general partner interests in the Partnership, AIMCO and its affiliates owned 4,558.50 limited partnership units (the “Units”) in the Partnership representing 26.57% of the outstanding Units at June 30, 2007. A number of these Units were acquired pursuant to tender offers made by AIMCO or its affiliates. Pursuant to the Partnership Agreement, unitholders holding a majority of the Units are entitled to take action with respect to a variety of matters that include, but are not limited to, voting on certain amendments to the Partnership Agreement and voting to remove the General Partner.  Although the General Partner owes fiduciary duties to the limited partners of the Partnership, the General Partner also owes fiduciary duties to AIMCO as its sole stockholder.   As a result, the duties of the General Partner, as general partner, to the Partnership and its limited partners may come i nto conflict with the duties of the General Partner to AIMCO as its sole stockholder.

ITEM 3.

CONTROLS AND PROCEDURES

(a)

Disclosure Controls and Procedures. The Partnership’s management, with the participation of the principal executive officer and principal financial officer of the General Partner, who are the equivalent of the Partnership’s principal executive officer and principal financial officer, respectively, has evaluated the effectiveness of the Partnership’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the principal executive officer and principal financial officer of the General Partner, who are the equivalent of the Partnership’s principal executive officer and principal financial officer, respectively, have concluded that, as of the end of such period, the Partnership’s disclosure controls and procedures are effective.

(b)

Internal Control Over Financial Reporting. There have not been any changes in the Partnership’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Partnership’s internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 5.

OTHER INFORMATION

None.

ITEM 6.

EXHIBITS

See Exhibit Index.

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	MCCOMBS REALTY PARTNERS
	By:   CRPTEX, Inc.
	General Partner
Date: August 13, 2007	By:   /s/Martha L. Long
	Martha L. Long
	Senior Vice President
Date: August 13, 2007	By:   /s/Stephen B. Waters
	Stephen B. Waters
	Vice President

McCOMBS REALTY PARTNERS

EXHIBIT INDEX

Exhibit

3.1

Amended and Restated Certificate and Agreement of Limited Partners of McCombs Realty Partners, a California Limited Partnership, incorporated by reference to the exhibits to the Registrant's Annual Report filed on Form 10-K, filed on April 13, 1990.

3.2

Certificate of Limited Partnership of the Partnership, incorporated by reference to the exhibits to the Registrant's Annual Report filed on Form 10-K, filed on April 13, 1990.

10.2

Loan Agreement dated May 27, 2005 between Pelham Place, L.P., a South Carolina limited partnership and GMAC Commercial Mortgage Bank, (incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 27, 2005).

10.3

Promissory Note A dated May 27, 2005 between Pelham Place, L.P., a South Carolina limited partnership and GMAC Commercial Mortgage Bank, (incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 27, 2005).

10.4

Promissory Note B dated May 27, 2005 between Pelham Place, L.P., a South Carolina limited partnership and GMAC Commercial Mortgage Bank, (incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 27, 2005).

10.5

Guaranty dated May 27, 2005 by AIMCO Properties, L.P., for the benefit of GMAC Commercial Mortgage Bank, (incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 27, 2005).

10.6

Rate Cap Provider – Consent and Acknowledgement dated May 27, 2005 by and among GMAC Commercial Mortgage Bank, Pelham Place, L.P., a South Carolina Limited Partnership, and SMBC, (incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 27, 2005).

10.7

Purchase and Sale Contract between Pelham Place Limited Partnership, a South Carolina limited partnership, and the affiliated Selling Partnerships and Northview Realty Group, Inc., a Canadian corporation, dated May 23, 2007. (incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 23, 2007).

10.8

Amendment to Purchase and Sale Contract between Pelham Place Limited Partnership, a South Carolina limited partnership, and the affiliated Selling Partnerships and Northview Realty Group, Inc., a Canadian corporation, dated June 5, 2007. (incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 13, 2007).

10.9

Second Amendment to Purchase and Sale Contract between Pelham Place Limited Partnership, a South Carolina limited partnership, and the affiliated Selling Partnerships and Northview Realty Group, Inc., a Canadian Corporation, dated June 6, 2007. (incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 13, 2007).

10.10

Third Amendment to and Reinstatement of Purchase and Sale Contract between Pelham Place Limited Partnership, a South Carolina limited partnership, and the affiliated Selling Partnerships and Northview Realty Group, Inc., a Canadian corporation, dated June 15, 2007. (incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 13, 2007).

31.1

Certification of equivalent of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of equivalent of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certification of equivalent of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Exhibit 31.1

CERTIFICATION

I, Martha L. Long, certify that:

1.

I have reviewed this quarterly report on Form 10-QSB of McCombs Realty Partners;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report;

4.

The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)

Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and

5.

The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Date: August 13, 2007

/s/Martha L. Long

Martha L. Long

Senior Vice President of CRPTEX, Inc., equivalent of the chief executive officer of the Partnership

Exhibit 31.2

CERTIFICATION

I, Stephen B. Waters, certify that:

1.

I have reviewed this quarterly report on Form 10-QSB of McCombs Realty Partners;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report;

4.

The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)

Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and

5.

The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Date: August 13, 2007

/s/Stephen B. Waters

Stephen B. Waters

Vice President of CRPTEX, Inc., equivalent of the chief financial officer of the Partnership

Exhibit 32.1

Certification of CEO and CFO

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-QSB of McCombs Realty Partners (the "Partnership"), for the quarterly period ended June 30, 2007 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Martha L. Long, as the equivalent of the chief executive officer of the Partnership, and Stephen B. Waters, as the equivalent of the chief financial officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

      /s/Martha L. Long

Name: Martha L. Long

Date: August 13, 2007

      /s/Stephen B. Waters

Name: Stephen B. Waters

Date: August 13, 2007

This certification is furnished with this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Partnership for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.