10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q

(Mark One)
[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000
	OR
[   ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	FOR THE TRANSITION PERIOD FROM             TO

Commission File Number 0-24497

AIMCO Properties, L.P.
(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of Incorporation or organization)	84-1275621 (I.R.S. Employer Identification No.)
2000 South Colorado Boulevard, Tower 2, Suite 2-1000 Denver, Colorado (Address of principal executive offices)	80222 (Zip Code)

(303) 757-8101
(Registrant’s telephone number, including area code)

Not Applicable
(Former name, former address, and former fiscal year,
if changed since last report)

      Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such 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 [  ]

      The number of Partnership Common Units outstanding as of October 31, 2000: 78,891,127

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
	ITEM 1. Financial Statements
	CONSOLIDATED BALANCE SHEETS
	CONSOLIDATED STATEMENTS OF INCOME
	CONSOLIDATED STATEMENTS OF CASH FLOWS
	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
	ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
PART II. OTHER INFORMATION
	ITEM 1. Legal Proceedings
	ITEM 2. Changes in Securities and Use of Proceeds
	ITEM 3. Defaults Upon Senior Securities
	ITEM 4. Submission of Matters to a Vote of Security Holders
	ITEM 5. Other Information
	ITEM 6. Exhibits and Reports on Form 8-K
SIGNATURES
EX-10.1 14th Amendment to Amended/Restated Agrmnt
EX-10.2 15th Amendment to Amended/Restated Agrmnt
EX-10.3 16th Amendment to Amended/Restated Agrmnt
EX-10.4 Seventeenth Amendment to LP
EX-27.1 Financial Data Schedule
EX-99.1 Agreement-Disclosure of Long-Term Debt

AIMCO PROPERTIES, L.P.

FORM 10-Q

INDEX

		Page
PART I	FINANCIAL INFORMATION
ITEM 1.	Financial Statements
	Consolidated Balance Sheets as of September 30, 2000 (unaudited) and December 31, 1999		3
	Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2000 and 1999 (unaudited)		4
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2000 and 1999 (unaudited)		5
	Notes to Consolidated Financial Statements (unaudited)		6
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		24
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk		31
PART II	OTHER INFORMATION
ITEM 1.	Legal Proceedings		32
ITEM 2.	Changes in Securities and Use of Proceeds		32
ITEM 3.	Defaults Upon Senior Securities		32
ITEM 4.	Submission of Matters to a Vote of Security Holders		32
ITEM 5.	Other Information		32
ITEM 6.	Exhibits and Reports on Form 8-K		33
Signatures			34

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AIMCO PROPERTIES, L.P.

CONSOLIDATED BALANCE SHEETS
(In Thousands)

					September 30,			December 31,
					2000			1999
					(Unaudited)
				ASSETS
Real Estate, net of accumulated depreciation of $649,805 and $415,992					$	5,471,869		$	4,096,705
Investments in unconsolidated real estate partnerships						798,502			890,318
Investments in unconsolidated subsidiaries						91,358			44,921
Notes receivable from unconsolidated real estate partnerships						145,587			142,828
Notes receivable from and advances to unconsolidated subsidiaries						213,991			88,754
Cash and cash equivalents						106,544			101,604
Restricted cash						113,545			84,595
Other assets						214,688			234,526
		Total assets			$	7,156,084		$	5,684,251
			LIABILITIES AND PARTNERS’ CAPITAL
Liabilities:
Secured notes payable					$	2,836,097		$	1,954,259
Secured tax-exempt bond financing						583,106			420,830
Unsecured short-term financing						406,000			209,200
		Total indebtedness				3,825,203			2,584,289
Accounts payable, accrued and other liabilities						242,957			271,298
Resident security deposits and deferred rental income						32,899			22,793
		Total liabilities				4,101,059			2,878,380
Commitments and contingencies						—			—
Mandatory redeemable convertible preferred securities						35,330			149,500
Minority interest in other entities						194,955			169,482
Partners’ capital:
	Preferred Units					934,474			707,745
	General Partner and Special Limited Partner					1,560,826			1,545,715
	Limited Partners					350,429			256,429
Less: Investment in AIMCO Preferred Stock						—			(23,000	)
		Investment in AIMCO Common Stock				(20,989	)		—
		Total partners’ capital				2,824,740			2,486,889
		Total liabilities and partners’ capital			$	7,156,084		$	5,684,251

See notes to consolidated financial statements.

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AIMCO PROPERTIES, L.P.

CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Per Unit Data)
(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2000			1999			2000			1999
RENTAL PROPERTY OPERATIONS:
Rental and other property revenues	$	271,079		$	120,398		$	753,463		$	347,187
Property operating expense		(107,031	)		(48,049	)		(302,435	)		(135,580	)
Owned property management expense		(3,473	)		(282	)		(9,713	)		(367	)
Depreciation		(76,548	)		(28,139	)		(223,128	)		(82,582	)
Income from property operations		84,027			43,928			218,187			128,658
SERVICE COMPANY BUSINESS:
Management fees and other income		14,430			9,310			36,865			23,567
Management and other expenses		(10,697	)		(14,595	)		(23,603	)		(25,883	)
Income (loss) from service company business		3,733			(5,285	)		13,262			(2,316	)
General and administrative expenses		(4,459	)		(2,963	)		(9,609	)		(7,210	)
Interest expense		(67,855	)		(31,322	)		(190,459	)		(91,416	)
Interest income		18,841			17,636			47,352			37,832
Equity in earnings (losses) of unconsolidated real estate partnerships		(8,375	)		1,606			(4,489	)		7,264
Equity in earnings (losses) of unconsolidated subsidiaries		(1,934	)		(2,086	)		2,538			(5,808	)
Loss from IPLP exchange and assumption		—			—			—			(684	)
Minority interest in other entities		2,475			2			(10,977	)		(2,078	)
Amortization of intangibles		(1,898	)		(1,942	)		(4,968	)		(5,826	)
Income from operations		24,555			19,574			60,837			58,416
Net gain on disposition of properties		8,902			315			14,234			330
Net income		33,457			19,889			75,071			58,746
Net income attributable to preferred unitholders		17,381			14,636			49,698			41,571
Net income attributable to common unitholders	$	16,076		$	5,253		$	25,373		$	17,175
Basic earnings per common unit	$	0.21		$	0.08		$	0.35		$	0.25
Diluted earnings per common unit	$	0.20		$	0.07		$	0.34		$	0.25
Dividends declared per common unit	$	0.700		$	0.625		$	2.100		$	1.875

See notes to consolidated financial statements.

4

AIMCO PROPERTIES, L.P.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)

				Nine Months Ended September 30,
				2000			1999
CASH FLOWS FROM OPERATING ACTIVITIES:
	Net income			$	75,071		$	58,746
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization of intangibles			234,238			100,570
		Gain on disposition of properties			(14,234	)		(330	)
		Minority interest			10,977			2,078
		Equity in (earnings) losses of unconsolidated real estate partnerships			4,489			(7,264	)
		Equity in earnings of unconsolidated subsidiaries			(2,538	)		(2,247	)
		Loss from IPLP exchange and assumption			—			684
		Changes in operating assets and operating liabilities			(26,818	)		11,615
			Total adjustments		206,114			105,106
			Net cash provided by operating activities		281,185			163,852
CASH FLOWS FROM INVESTING ACTIVITIES:
	Purchases of and additions to real estate				(520,990	)		(162,686	)
	Proceeds from sale of property held for sale				84,324			41,204
	Cash from newly consolidated properties				206,115			—
	Purchase of notes receivable, general and limited partnership interests and other assets				(225,840	)		(111,127	)
	Purchase of/additions to notes receivable				(202,314	)		(38,368	)
	Proceeds from repayment of notes receivable				20,885			22,433
	Cash received in connection with acquisitions				3,752			22,677
	Cash paid for merger related costs				(8,236	)		(17,949	)
	Distributions received from investments in real estate partnerships				79,278			58,297
	Distributions received from investments in unconsolidated subsidiaries				—			33,985
			Net cash used in investing activities		(563,026	)		(151,534	)
CASH FLOWS FROM FINANCING ACTIVITIES:
	Proceeds from secured notes payable borrowings				151,452			248,126
	Principal repayments on secured notes payable				(81,450	)		(24,555	)
	Proceeds from secured tax-exempt bond financing				—			20,731
	Principal repayments on secured tax-exempt bond financing				(24,848	)		(38,527	)
	Repayments on secured short-term financing				—			(4,522	)
	Net borrowings (paydowns) on revolving credit facilities				244,800			(263,600	)
	Payment of loan costs				(3,603	)		(13,360	)
	Proceeds from issuance of common and preferred units, exercise of options/warrants				250,285			291,188
	Repurchase of common units				(2,580	)		—
	Principal repayments received on notes due from officers on common unit purchases				13,283			4,444
	Payment of distributions to minority interest				(58,555	)		(12,606	)
	Payment of distributions to General Partner and Special Limited Partner				(138,622	)		(113,371	)
	Payment of distributions to Limited Partners				(18,540	)		(18,357	)
	Payment of preferred unit distributions				(44,841	)		(84,538	)
			Net cash provided by (used in) financing activities		286,781			(8,947	)
NET INCREASE IN CASH AND CASH EQUIVALENTS					4,940			3,371
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD					101,604			52,832
CASH AND CASH EQUIVALENTS AT END OF PERIOD				$	106,544		$	56,203

See notes to consolidated financial statements.

5

AIMCO PROPERTIES, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2000
(Unaudited)

NOTE 1 — Organization

      AIMCO Properties, L.P., a Delaware limited partnership (the “Partnership” and together with its consolidated subsidiaries and other controlled entities, the “Company”), was formed on May 16, 1994 to conduct the business of acquiring, developing, leasing, and managing multi-family apartment communities. The Partnership’s securities include Partnership Common Units (“Common OP Units”), Partnership Preferred Units (“Preferred Units”, together with Common OP Units, the “OP Units”), and High Performance Units (see Note 9). Apartment and Investment Management Company (“AIMCO”) is the owner of the General Partner and Special Limited Partner, as defined in the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P. (the “Partnership Agreement”) of the Partnership. The General Partner and Special Limited Partner hold Common OP Units of the Partnership. In addition, AIMCO is the primary holder of outstanding Preferred Units. The Limited Partners of the Partnership are individuals or entities that own OP Units other than AIMCO. After holding the Common OP Units for one year, the Limited Partners have the right to redeem their Common OP Units for cash, subject to the prior right of AIMCO to elect to acquire some or all of the Common OP Units tendered for redemption for cash or in exchange for shares of AIMCO Class A Common Stock, on a one-for-one ratio.

      The Partnership, through its operating divisions and subsidiaries, was formed to hold and conduct substantially all of AIMCO’s operations, and manages the daily operations of AIMCO’s business and assets. All employees of the Company are employees of the Partnership; AIMCO has no employees.

      AIMCO is required to contribute to the Partnership all proceeds from offerings of its securities. In addition, substantially all of AIMCO’s assets must be owned through the Partnership; therefore, AIMCO is generally required to contribute to the Partnership all assets acquired. In exchange for the contribution of offering proceeds or assets, AIMCO receives additional interests in the Partnership with similar terms (i.e., if AIMCO contributes proceeds of a preferred stock offering, AIMCO receives Preferred Units).

      AIMCO frequently consummates transactions for the benefit of the Partnership. For legal, tax or other business reasons, AIMCO may hold title or ownership of certain assets until they can be transferred to the Partnership. However, the Partnership has a controlling financial interest in all of AIMCO’s assets in the process of transfer to the Partnership.

      At September 30, 2000 the Partnership had 78,785,344 Common OP Units outstanding and 33,660,471 Preferred Units outstanding.

      As of September 30, 2000, the Partnership:

• owned or controlled (consolidated) 137,419 units in 500 apartment properties;

• held an equity interest in (unconsolidated) 132,909 units in 769 apartment properties; and

• managed 63,458 units in 487 apartment properties for third party owners and affiliates.

NOTE 2 — Basis of Presentation

      The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. 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

6

management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2000 are not necessarily indicative of the results that may be expected for the year ended December 31, 2000.

      The balance sheet at December 31, 1999 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

      For further information, refer to the statements and notes thereto included in AIMCO Properties, L.P. annual report on Form 10-K for the year ended December 31, 1999. Certain 1999 financial statement amounts have been reclassified to conform to the 2000 presentation.

      The accompanying unaudited consolidated financial statements include the accounts of the Partnership and subsidiaries and limited partnerships in which the Partnership has a financial controlling interest. Pursuant to a Management and Contribution Agreement between the Partnership and AIMCO, the Partnership has acquired, in exchange for interests in the Partnership, the economic benefits of subsidiaries of AIMCO in which the Partnership does not have an interest, and AIMCO has granted the Partnership a right of first refusal to acquire such subsidiaries’ assets for no additional consideration. Pursuant to the agreement, AIMCO has also granted the Partnership certain rights with respect to assets of such subsidiaries. Interests held by limited partners in real estate partnerships controlled by the Company and interests held by the shareholders of Insignia Properties Trust (through February 26, 1999) are reflected as minority interest. All significant intercompany balances and transactions have been eliminated in consolidation. Minority interest in limited partnerships represents the non-controlling partners’ share of the underlying net assets of the Company’s controlled limited partnerships. With regard to such partnerships, losses in excess of the minority partners’ basis of $2.9 million for the three months ended and $18 million for the nine months ended September 30, 2000, respectively, have been charged to operations. The assets of property owning limited partnerships and limited liability companies owned or controlled by AIMCO or the Partnership generally are not available to pay creditors of AIMCO or the Partnership.

NOTE 3 — Acquisitions

      During the nine months ended September 30, 2000 the Company purchased:

• for $117.9 million limited partnership interests in 539 partnerships (which own 1,657 properties) where the Company serves as general partner;

• six apartment communities with details below:

Date Acquired	Location	Number of Units		Purchase Price
January 2000	Falls Church, VA		159	$	12.2 million
September 2000	Forestville, MD		108		4.3 million
September 2000	Leesburg, VA		164		9.6 million
September 2000	Alexandria, VA		142		9.0 million
September 2000	Hyattsville, MD		296		18.3 million
September 2000	Hyattsville, MD		303		14.0 million

• all the stock and other interests (not already owned by AIMCO) held by the principals, officers and directors of Oxford Realty Financial Group, Inc. (“ORFG”) in entities, including ORFG, which own interests in and control the Oxford properties for $266 million in cash and $62 million in Common OP Units valued at $45 per unit. In addition to the cash and securities, AIMCO assumed a non-recourse pro-rata share of the outstanding mortgage debt ($1.4 billion) secured by the Oxford properties of $555 million, for a total purchase price of $883 million. Approximately $25 million in transaction costs were incurred. The Oxford properties are 167 apartment communities including 36,949 units, located in 18 states. AIMCO, through an affiliate, previously managed 165 of the 167 Oxford properties pursuant to long-term contracts and was previously a stockholder in certain of the entities. In addition to the Oxford properties, AIMCO acquired the entity which owns the managing general

7

partner of Oxford Tax Exempt Fund II Limited Partnership (“OTEF”) and acquired approximately a 40% interest in the non-managing general partner of OTEF. The Partnership borrowed $279 million to pay the cash portion of the purchase price for the Oxford acquisition from Bank of America, N.A., Lehman Commercial Paper Inc. and several other lenders, pursuant to a term loan with a total availability of $302 million.

NOTE 4 — Interest Income Recognition for Notes Receivable and Investments

      As of September 30, 2000 the Company holds $91 million of par value notes, plus accrued interest, net of intercompany par value notes, plus accrued interest, of $93 million (“general partner par value notes”), for which management believes the collectibility of such amounts is both probable and estimable. Interest income for all general partner par value notes receivable, notes receivable from officers and others as well as money market and interest bearing accounts generally is recognized as it is earned. Interest income from such notes and investments for the three and nine months ended September 30, 2000, totaled approximately $12 million and $25 million, respectively.

      As of September 30, 2000, the Company held discounted notes, with a carrying value including accrued interest, of $55 million, which were made by predecessors whose positions have been acquired by the Company at a discount and are carried at the acquisition amount (“discounted notes”). The total face value plus accrued interest of these notes was $126 million. In general, interest income from the discounted notes is not recognized as it is accrued under the note instrument because the timing and amounts of cash flows are not probable and estimable. Under the cost recovery method, the discounted notes are carried at the acquisition amount, less subsequent cash collections, until such time as collectibility is probable and the timing and amounts are estimable. Based upon closed or pending transactions (including sales activity), market conditions, and improved operations of the obligor, among other things, certain notes and the related discounts have been determined to be collectible. Accordingly, interest income that had previously been deferred and portions of the related discounts were recognized as interest income during the period. For the three and nine months ended September 30, 2000, the Company recognized deferred interest income and discounts of approximately $7 million ($0.09 per basic and diluted unit) and $21 million ($0.29 per basic and $0.28 per diluted unit), respectively, compared to $7 million ($0.10 per basic and diluted unit) and $10 million ($0.15 per basic and diluted unit), respectively, for the three and nine months ended September 30, 1999.

NOTE 5 — Commitments and Contingencies

Legal

      The Company is a party to various legal actions resulting from its operating activities. These actions are routine litigation and administrative proceedings arising in the ordinary course of business, some of which are covered by liability insurance, and none of which are expected to have a material adverse effect on the consolidated financial condition or results of operations of the Company and its subsidiaries taken as a whole.

Limited Partnerships

      In connection with the Company’s acquisitions of interests in limited partnerships that own properties, the Company and its affiliates are sometimes subject to legal actions, including allegations that such activities may involve breaches of fiduciary duties to the limited partners of such partnerships or violations of the relevant partnership agreements. The Company believes it complies with its fiduciary obligations and relevant partnership agreements, and does not expect any such legal actions to have a material adverse effect on the consolidated financial condition or results of operations of the Company and its subsidiaries taken as a whole.

Pending Investigations of HUD Management Arrangements

      In July 1999, the National Housing Partnership (“NHP”) received a grand jury subpoena requesting documents relating to NHP’s management of HUD-assisted or HUD-insured multi-family projects and NHP’s operation of a group purchasing program created by NHP, known as Buyers Access. The subpoena relates to the same subject

8

matter as subpoenas NHP received in October and December of 1997 from the HUD Inspector General. To date, neither the HUD Inspector General nor the grand jury has initiated any action against NHP or AIMCO or, to NHP’s or AIMCO’s knowledge, any owner of HUD property managed by NHP. AIMCO believes that NHP’s operations and programs are in compliance, in all material respects, with all laws, rules and regulations relating to HUD-assisted or HUD-insured properties. AIMCO is cooperating with the investigation and does not believe that the investigation will result in a material adverse effect on the financial condition of the Company. However, as with any similar investigation, there can be no assurance that these will not result in material fines, penalties or other costs that may impact the Company’s future results of operations or cash flows.

Environmental

      Various Federal, state and local laws subject property owners or operators to liability for 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 of the hazardous substances. The presence of, or the failure to properly remediate, hazardous substances may adversely affect occupancy at contaminated apartment communities and our ability to sell or borrow against contaminated properties. In addition to the costs associated with investigation and remediation actions brought by governmental agencies, the presence of hazardous wastes on a property could result in personal injury or similar claims by private plaintiffs. Various laws also impose liability for the cost of removal or remediation of hazardous substances at the disposal or treatment facility. Anyone who arranges for the disposal or treatment of hazardous or toxic 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 our properties, the Company could potentially be liable for environmental liabilities or costs associated with properties or properties it acquires or manages in the future.

NOTE 6 — Partners’ Capital

Common OP Units

      Common OP Units are redeemable by Common OP Unitholders (other than the General Partner and Special Limited Partner) at their option, subject to certain restrictions, on the basis of one Common OP Unit for either one share of AIMCO Class A Common Stock or cash equal to the fair value of a share of AIMCO Class A Common Stock at the time of redemption. AIMCO has the option to deliver shares of AIMCO Class A Common Stock in exchange for all or any portion of the cash requested. When a Limited Partner redeems a Common OP Unit for AIMCO Class A Common Stock, Limited Partners’ capital is reduced and Special Limited Partners’ capital is increased. Common OP Units held by AIMCO are not redeemable.

      On September 20, 2000, the Company issued 1,381,704 Common OP Units, valued at $45 per unit, in connection with the acquisition of all of the stock and other interests held by the principals, officers and directors of ORFG and control of the managing general partner of OTEF.

Tenders

      During the three and nine months ending September 30, 2000 the Company completed tender offers for limited partnership interests resulting in the issuance of 58,373 and 67,085 OP Units, respectively.

Preferred Units

      All outstanding classes of Preferred Units are on equal parity with each other and are senior to the Common OP Units. Generally, holders of classes of Preferred Units do not have any voting rights, except the right to approve certain changes to the Partnership Agreement that would adversely affect holders of such class of units.

      In January 2000, AIMCO issued 1,200,000 shares of newly created Class M Convertible Cumulative Preferred Stock, par value $.01 per share (“Class M Preferred Stock”), in a direct placement. The proceeds of $30.0 million were contributed by AIMCO to the Partnership in exchange for 1,200,000 Class M Preferred Units and were used to

9

repay certain indebtedness and for working capital. The Class M Preferred Units have substantially the same terms as the shares of Class M Preferred Stock. For the period beginning January 13, 2000 through and including January 13, 2003, the holders of the Class M Preferred Stock are entitled to receive, when and as declared by the Board of Directors of AIMCO, annual cash dividends in an amount per share equal to the greater of (i) $2.125 per year (equivalent to 8.5% of the liquidation preference), or (ii) the cash dividends payable on the number of shares of AIMCO Class A Common Stock into which a share of Class M Preferred Stock is convertible. Beginning with the third anniversary of the date of original issuance, the holders of Class M Preferred Stock will be entitled to receive an amount per share equal to the greater of (i) $2.3125 per year (equivalent to 9.25% of the liquidation preference), or (ii) the cash dividends payable on the number of shares of AIMCO Class A Common Stock into which a share of Class M Preferred Stock is convertible. Distributions are made on the Class M Preferred Units at the same time and in the same amount as dividends paid on the Class M Preferred Stock. The Class M Preferred Units are senior to the Common OP Units as to distributions and liquidation. Upon any liquidation, dissolution or winding up of the Company, before payments or distributions by the Company are made to any holders of AIMCO Class A Common Stock, the holders of the Class M Preferred Stock and the Class M Preferred Units are entitled to receive a liquidation preference of $25 per share/unit, plus accumulated, accrued and unpaid dividends/distributions.

      On September 13, 2000, AIMCO issued 4,000,000 shares of newly created Class N Convertible Cumulative Preferred Stock, par value $.01 per share (“Class N Preferred Stock”), in a direct placement at a purchase price of $25.00 per share. The proceeds of $100 million were contributed by AIMCO to the Partnership in exchange for 4,000,000 Class N Preferred Units and were used to repay indebtedness. The Class N Preferred Units have substantially the same terms as the shares of Class N Preferred Stock. The terms of the Class N Preferred Stock are summarized as follows: Dividends on the Class N Preferred Stock will be paid in an amount per share equal to the greater of (i) $2.25 per year (equivalent to 9% per annum of the $25.00 liquidation preference), subject to increase in the event of a change in control of AIMCO or (ii) the cash dividends payable on the number of shares of Class A Common Stock (or portion thereof) into which a share of Class N Preferred Stock is convertible. Dividends will be paid on the Class N Preferred Stock quarterly, beginning on October 1, 2000 (the initial dividend payable on the Class N Preferred Stock will be $0.10 per share). Distributions are made on the Class N Preferred Units at the same time and in the same amount as dividends paid on the Class N Preferred Stock. The Class N Preferred Units are senior to the Common OP Units as to distributions and liquidation. AIMCO is not allowed to redeem the Class N Preferred Stock before the third anniversary of the original date of issuance except in order to preserve its status as a real estate investment trust or upon a change of control. On and after the third anniversary of the original date of issuance, AIMCO may, at its option, redeem the Class N Preferred Stock for cash at the redemption prices set forth in the placement agreement plus accrued and unpaid dividends, if any, to the redemption date. The Class N Preferred Stock has no stated maturity and is not subject to any sinking fund or mandatory redemption. Investors in the Class N Preferred Stock generally have no voting rights, except if AIMCO fails to pay dividends for six or more quarters on the Class N Preferred Stock or if AIMCO fails to pay dividends on AIMCO Class A Common Stock of at least $0.595 per quarter. Each share of Class N Preferred Stock will initially be convertible, at the option of the holder at any time, into one share of Class A Common Stock, subject to adjustment in certain circumstances. Between the first and second anniversary of the date of issuance, AIMCO may require that up to 2,000,000 shares of the Class N Preferred Stock be converted into Class A Common Stock if the rate of return on the Class N Preferred Stock exceeds 20% per annum. Between the second and third anniversary of the date of issuance, AIMCO may require that all or any portion of the Class N Preferred Stock be converted into Class A Common Stock if the rate of return on the Class N Preferred Stock exceeds 20% per annum. The Class N Preferred Units are redeemed or converted to Common OP Units, when the shares of Class N Preferred Stock are redeemed or converted to Class A Common Stock. On September 13, 2000, AIMCO also issued 1,904,762 shares of newly created Class O Cumulative Convertible Preferred Stock, par value $.01 per share (“Class O Preferred Stock”), to an institutional investor in a sale effected under AIMCO’s shelf registration statement. The proceeds of $100.0 million were contributed by AIMCO to the Partnership in exchange for 1,904,762 Class O Preferred Units and were used to repay indebtedness. The Class O Preferred Units have substantially the same terms as the shares of Class O Preferred Stock. The terms of the Class O Preferred Stock are summarized as follows: Dividends on the Class O Preferred Stock will be paid in an amount per share equal to the greater of (i) $4.725 per year (equivalent to 9% per annum of the $52.50 liquidation preference), subject to increase in the event of a change in control of AIMCO or (ii) the cash dividends payable on the number of shares of Class A Common Stock (or portion thereof) into which a share of Class O Preferred Stock is convertible. Dividends will be paid on the Class O Preferred Stock quarterly, beginning on October 1, 2000 (the initial dividend payable on the Class O Preferred Stock will be $0.21 per share). Distributions are made on the Class O Preferred Units at the same time and in the same amount as dividends paid on

10

the Class O Preferred Stock. The Class O Preferred Units are senior to the Common OP Units as to distributions and liquidation. AIMCO is not allowed to redeem the Class O Preferred Stock before the third anniversary of the original date of issuance except in order to preserve its status as a real estate investment trust or upon a change of control. On and after the third anniversary of the original date of issuance, AIMCO may, at its option, redeem the Class O Preferred Stock for cash at the redemption prices set forth in the placement agreement plus accrued and unpaid dividends, if any, to the redemption date. The Class O Preferred Stock has no stated maturity and is not subject to any sinking fund or mandatory redemption. Investors in the Class O Preferred Stock generally have no voting rights, except if AIMCO fails to pay dividends for six or more quarters on the Class O Preferred Stock or if AIMCO fails to pay dividends on AIMCO Class A Common Stock of at least $0.595 per quarter. Each share of Class O Preferred Stock will initially be convertible, at the option of the holder at any time, into one share of Class A Common Stock, subject to adjustment in certain circumstances. Between the first and second anniversary of the date of issuance, AIMCO may require that up to 952,381 shares of the Class O Preferred Stock be converted into Class A Common Stock if the rate of return on the Class O Preferred Stock exceeds 20% per annum. Between the second and third anniversary of the date of issuance, AIMCO may require that all or any portion of the Class O Preferred Stock be converted into Class A Common Stock if the rate of return on the Class O Preferred Stock exceeds 20% per annum. The Class O Preferred Units are redeemed or converted into Common OP Units when the shares of Class O Preferred Stock are redeemed or converted to Class A Common Stock.

      In addition to the Preferred Units described above, the Partnership has issued Preferred Units to third parties as follows:

      In the three months and nine months ended September 30, 2000, the Company completed tender offers for limited partnership interests resulting in the issuance of 15,000 and 68,843 Class Two Partnership Preferred Units, respectively.

      In January 2000, the Company acquired Merrill House, a 159 unit apartment community for approximately $12.2 million, including the issuance of 205,938 Class Four Partnership Preferred Units valued at $5.2 million. During June 2000, 24,235 of the 205,938 Class Four Partnership Preferred Units issued were exchanged for cash and retired pursuant to the provisions of the purchase agreement. During July 2000, 3,445 of the remaining 181,702 Class Four Partnership Preferred Units issued were exchanged for cash and retired pursuant to the provisions of the purchase agreement;

      In September 2000, the Company acquired five apartment properties, with a combined total of 1,013 units for approximately $55 million, including the issuance of 807,016 Class Six Partnership Preferred Units valued at $20.2 million.

      In June 2000, the Partnership converted 250,000 shares of AIMCO Class J Cumulative Convertible Preferred Stock, with a liquidation value of $25 million, into 625,000 shares of AIMCO Class A Common Stock. In connection with this conversion, 41,991 shares of AIMCO Class A Common Stock, valued at $1.5 million, were exchanged by the Partnership for Common OP Units held by a limited partner.

11

      As of September 30, 2000, the Partnership had issued and outstanding the following partnership interests:

		Units
Class		Outstanding
Partnership Common OP Units			78,785,344
Partnership Preferred Units:
	Class B Partnership Preferred Units		419,471
	Class C Partnership Preferred Units		2,400,000
	Class D Partnership Preferred Units		4,200,000
	Class G Partnership Preferred Units		4,050,000
	Class H Partnership Preferred Units		2,000,000
	Class K Partnership Preferred Units		5,000,000
	Class L Partnership Preferred Units		5,000,000
	Class M Partnership Preferred Units		1,200,000
	Class N Partnership Preferred Units		4,000,000
	Class O Partnership Preferred Units		1,904,762
	Class One Partnership Preferred Units		90,000
	Class Two Partnership Preferred Units		79,534
	Class Three Partnership Preferred Units		1,682,397
	Class Four Partnership Preferred Units		758,620
	Class Five Partnership Preferred Units		68,671
	Class Six Partnership Preferred Units		807,016
Total Partnership Preferred Units			33,660,471

12

NOTE 7 — Earnings Per Unit

      The following tables illustrate the calculation of basic and diluted earnings per common unit for the three and nine months ended September 30, 2000 and 1999 (in thousands, except per unit data):

			Three Months Ended September 30,
			2000			1999
NUMERATOR:
Net income			$	33,457		$	19,889
Preferred unit distributions				(17,381	)		(14,636	)
Numerator for basic and diluted earnings per common unit — income attributable to common unitholders			$	16,076		$	5,253
DENOMINATOR:
Denominator for basic earnings per common unit — weighted average number of common units outstanding				74,022			69,925
Effect of dilutive securities:
Dilutive potential common units, options and warrants				4,018			1,081
Denominator for dilutive earnings per common unit				78,040			71,006
Basic earnings per common unit:
	Operations		$	0.08		$	0.07
	Gain on disposition of properties			0.13			0.01
		Total	$	0.21		$	0.08
Diluted earnings per common unit:
	Operations		$	0.08		$	0.07
	Gain on disposition of properties			0.12			—
		Total	$	0.20		$	0.07

			Nine Months Ended September 30,
			2000			1999
NUMERATOR:
Net income			$	75,071		$	58,746
Preferred unit distributions				(49,698	)		(41,571	)
Numerator for basic and diluted earnings per common unit — income attributable to common unitholders			$	25,373		$	17,175
DENOMINATOR:
Denominator for basic earnings per common unit — weighted average number of common units outstanding				72,969			67,597
Effect of dilutive securities:
Dilutive potential common units, options and warrants				1,837			1,179
Denominator for dilutive earnings per common unit				74,806			68,776
Basic earnings per common unit:
	Operations		$	0.14		$	0.25
	Gain on disposition of properties			0.21			—
		Total	$	0.35		$	0.25
Diluted earnings per common unit:
	Operations		$	0.13		$	0.25
	Gain on disposition of properties			0.21			—
		Total	$	0.34		$	0.25

13

NOTE 8 — Industry Segments

      The Company owns and operates multi-family apartment communities throughout the United States and Puerto Rico, which generate rental and other property-related income through the leasing of apartment units. The Company separately evaluates the performance of each of its apartment communities. However, because the apartment communities have similar economic characteristics, facilities, services and tenants, the apartment communities have been aggregated into a single apartment communities segment. All segment disclosures are included in or can be derived from the Company’s consolidated financial statements.

      All revenues are from external customers and no revenues are generated from transactions with other segments. There are no tenants who contributed 10% or more of the Company’s total revenues during the three months and nine months ended September 30, 2000 or September 30, 1999.

      Although the Company operates in only one segment, there are different components of the multi-family business for which management considers disclosure to be useful. The following tables present the contribution (separated between consolidated and unconsolidated activity) to the Company’s Free Cash Flow for the three months and nine months ended September 30, 2000, from these components, and a reconciliation of Free Cash Flow to: Earnings Before Structural Depreciation; Net Income; Funds From Operations; and Adjusted Funds From Operations (in thousands, except equivalent units (ownership effected and period weighted) and monthly rents):

14

FREE CASH FLOW FROM BUSINESS COMPONENTS
For the Three Months Ended September 30, 2000
(in thousands)

					Consolidated			Unconsolidated		Total			%
	Real Estate
		Conventional
				Average monthly rent greater than $800 per unit (14,427 equivalent units)	$	32,626		$	2,194	$	34,820			20.2	%
				Average monthly rent $700 to $800 per unit (8,698 equivalent units)		15,805			1,141		16,946			9.9	%
				Average monthly rent $600 to $700 per unit (27,225 equivalent units)		40,015			1,861		41,876			24.3	%
				Average monthly rent $500 to $600 per unit (40,558 equivalent units)		38,532			4,213		42,745			24.9	%
				Average monthly rent less than $500 per unit (23,363 equivalent units)		14,316			837		15,153			8.8	%
				Subtotal conventional real estate contribution to Free Cash Flow		141,294			10,246		151,540			88.1	%
		Affordable (12,445 equivalent units)				6,731			7,362		14,093			8.2	%
		College housing (average rent of $663 per month) (2,490 equivalent units)				3,206			129		3,335			1.9	%
		Other Properties				587			92		679			0.4	%
		Resident services				628			67		695			0.4	%
		Minority interest				(22,119	)		—		(22,119	)		(12.9	%)
				Total real estate contribution to Free Cash Flow		130,327			17,896		148,223			86.1	%
	Service Businesses
		Management contract (property and asset management)   Controlled properties				1,740			232		1,972			1.1	%
				Third party with terms in excess of one year		—			2,701		2,701			1.6	%
				Third party cancelable in 30 days		—			1,142		1,142			0.7	%
				Subtotal management contracts contribution to Free Cash Flow		1,740			4,075		5,815			3.4	%
		Buyers Access				—			53		53			0.0	%
		Other service businesses				978			915		1,893			1.1	%
				Total service businesses contribution to Free Cash Flow		2,718			5,043		7,761			4.5	%
	Interest income
		General partner loan interest				6,721			—		6,721			3.9	%
		Notes receivable from officers				184			—		184			0.1	%
		Other notes receivable				138			—		138			0.1	%
		Money market and interest bearing accounts				4,638			—		4,638			2.7	%
			Subtotal interest income			11,681			—		11,681			6.8	%
		Accretion of loan discount				7,160			—		7,160			4.2	%
				Total interest income contribution to Free Cash Flow		18,841			—		18,841			11.0	%
	Fee Income
		Disposition Fees				347			678		1,025			0.6	%
		Refinancing Fees				665			—		665			0.4	%
				Total fee income contribution to Free Cash Flow		1,012			678		1,690			1.0	%
	General and Administrative Expense					(4,459	)		—		(4,459	)		(2.6	%)
Free Cash Flow (1)					$	148,439		$	23,617	$	172,056			100.0	%

15

FREE CASH FLOW FROM BUSINESS COMPONENTS (Continued)
For the Three Months Ended September 30, 2000
(in thousands)

				Consolidated			Unconsolidated			Total
Free Cash Flow				$	148,439		$	23,617		$	172,056
Cost of Senior Capital
	Interest Expense:
		Secured debt
			Long-term, fixed rate		(58,429	)		(7,544	)		(65,973	)
			Long-term, variable rate		(281	)		(433	)		(714	)
		Lines of credit and other unsecured debt			(8,433	)		(335	)		(8,768	)
		Interest expense on convertible debt			(3,426	)		—			(3,426	)
		Interest capitalized			2,714			—			2,714
			Total interest expense before minority interest		(67,855	)		(8,312	)		(76,167	)
		Minority interest share of interest expense			10,687			—			10,687
			Total interest expense after minority interest		(57,168	)		(8,312	)		(65,480	)
	Dividends on preferred securities				(18,056	)		—			(18,056	)
		Contribution before non-cash charges and ownership adjustments			73,215			15,305			88,520
	Non-structural depreciation, net of capital replacements				(3,608	)		(1,665	)		(5,273	)
	Amortization of intangible assets				(1,898	)		(186	)		(2,084	)
	Gain (loss) on sales of real estate, net of minority interest				5,578			—			5,578
	Deferred tax provision				—			286			286
			Earnings Before Structural Depreciation (EBSD) (1)		73,287			13,740			87,027
	Structural depreciation, net of minority interest in other entities				(57,504	)		(13,447	)		(70,951	)
			Net income		15,783			293			16,076
	Gain (loss) on sales of real estate, net of minority interest				(5,578	)		—			(5,578	)
	Structural depreciation, net of minority interest in other entities				57,504			13,447			70,951
	Non-structural depreciation, net of minority interest in other entities				11,736			3,226			14,962
	Amortization of intangible assets				1,898			186			2,084
	Deferred tax provision				—			(286	)		(286	)
			Funds From Operations (FFO) (1)		81,343			16,866			98,209
	Capital Replacement provision				(8,129	)		(1,562	)		(9,691	)
			Adjusted Funds From Operations (AFFO) (1)	$	73,214		$	15,304		$	88,518

						Earnings
						per
						Common
		Earnings		Common Units		Unit
EBSD
	Basic	$	87,027		74,022
	Diluted	$	101,303		91,615
Net Income
	Basic	$	16,076		74,022	$	0.21
	Diluted	$	16,076		78,040	$	0.20
FFO
	Basic	$	98,209		74,022
	Diluted	$	112,485		91,615
AFFO
	Basic	$	88,518		74,022
	Diluted	$	102,794		91,615

16

FREE CASH FLOW FROM BUSINESS COMPONENTS
For the Nine Months Ended September 30, 2000
(in thousands)

					Consolidated			Unconsolidated		Total			%
	Real Estate
		Conventional
			Average monthly rent greater than $800 per unit (14,396 equivalent units)		$	88,164		$	8,212	$	96,376			19.7	%
			Average monthly rent $700 to $800 per unit (8,978 equivalent units)			40,322			5,362		45,684			9.3	%
			Average monthly rent $600 to $700 per unit (27,629 equivalent units)			104,637			10,059		114,696			23.4	%
			Average monthly rent $500 to $600 per unit (39,972 equivalent units)			111,741			14,098		125,839			25.7	%
			Average monthly rent less than $500 per unit (23,046 equivalent units)			45,135			4,608		49,743			10.1	%
				Subtotal conventional real estate contribution to Free Cash Flow		389,999			42,339		432,338			88.2	%
		Affordable (13,003 equivalent units)				13,772			26,390		40,162			8.2	%
		College housing (average rent of $663 per month) (2,691 equivalent units)				9,755			619		10,374			2.1	%
		Other Properties				1,376			1,240		2,616			0.5	%
		Resident services				3,015			390		3,405			0.7	%
		Minority interest				(65,134	)		—		(65,134	)		(13.3	)%
			Total real estate contribution to Free Cash Flow			352,783			70,978		423,761			86.4	%
	Service Businesses
		Management contract (property and asset management)  Controlled properties				8,366			2,581		10,947			2.2	%
			Third party with terms in excess of one year			—			7,226		7,226			1.5	%
			Third party cancelable in 30 days			—			2,570		2,570			0.5	%
				Subtotal management contracts contribution to Free Cash Flow		8,366			12,377		20,743			4.2	%
		Buyers Access				—			402		402			0.1	%
		Other service businesses				2,150			2,075		4,225			0.9	%
			Total service businesses contribution to Free Cash Flow			10,516			14,854		25,370			5.2	%
	Interest income
		General partner loan interest				15,662			—		15,662			3.2	%
		Notes receivable from officers				559			—		559			0.1	%
		Other notes receivable				731			—		731			0.1	%
		Money market and interest bearing accounts				9,843			—		9,843			2.0	%
				Subtotal interest income		26,795			—		26,795			5.5	%
		Accretion of loan discount				20,557			—		20,557			4.2	%
			Total interest income contribution to Free Cash Flow			47,352			—		47,352			9.7	%
	Fee Income
		Disposition Fees				1,914			644		2,558			0.5	%
		Refinancing Fees				832			99		931			0.2	%
			Total fee income contribution to Free Cash Flow			2,746			743		3,489			0.7	%
	General and Administrative Expense					(9,609	)		—		(9,609	)		(2.0	)%
Free Cash Flow (1)					$	403,788		$	86,575	$	490,363			100.0	%

17

FREE CASH FLOW FROM BUSINESS COMPONENTS (Continued)
For the Nine Months Ended September 30, 2000
(in thousands)

				Consolidated			Unconsolidated			Total
Free Cash Flow				$	403,788		$	86,575		$	490,363
Cost of Senior Capital
	Interest Expense:
		Secured debt
			Long-term, fixed rate		(167,040	)		(27,475	)		(194,515	)
			Long-term, variable rate		(742	)		(1,178	)		(1,920	)
		Lines of credit and other unsecured debt			(21,545	)		(1,168	)		(22,713	)
		Interest expense on convertible debt			(8,285	)		—			(8,285	)
		Interest capitalized			7,153			1,165			8,318
			Total interest expense before minority interest		(190,459	)		(28,656	)		(219,115	)
		Minority interest share of interest expense			28,758			—			28,758
			Total interest expense after minority interest		(161,701	)		(28,656	)		(190,357	)
	Dividends on preferred securities				(51,728	)		—			(51,728	)
		Contribution before non-cash charges and ownership adjustments			190,359			57,919			248,278
	Non-structural depreciation, net of capital replacements				(8,372	)		(2,927	)		(11,299	)
	Amortization of intangible assets				(4,968	)		(1,205	)		(6,173	)
	Gain (loss) on sales of real estate, net of minority interest				8,883			—			8,883
	Deferred tax provision				—			(2,675	)		(2,675	)
		Earnings Before Structural Depreciation (EBSD) (1)			185,902			51,112			237,014
	Structural depreciation, net of minority interest in other entities				(169,178	)		(42,463	)		(211,641	)
		Net income			16,724			8,649			25,373
	Gain (loss) on sales of real estate, net of minority interest				(8,883	)		—			(8,883	)
	Structural depreciation, net of minority interest in other entities				169,178			42,463			211,641
	Non-structural depreciation, net of minority interest in other entities				31,769			8,771			40,540
	Amortization of intangible assets				4,968			1,205			6,173
	Deferred tax provision				—			2,675			2,675
			Funds From Operations (FFO) (1)		213,756			63,763			277,519
	Capital Replacement provision				(23,397	)		(5,851	)		(29,248	)
			Adjusted Funds From Operations (AFFO) (1)	$	190,359		$	57,912		$	248,271

						Earnings
						per
						Common
		Earnings		Common Units		Unit
EBSD
	Basic	$	237,014		72,969
	Diluted	$	275,405		89,396
Net Income
	Basic	$	25,373		72,969	$	0.35
	Diluted	$	25,373		74,806	$	0.34
FFO
	Basic	$	277,519		72,969
	Diluted	$	315,910		89,396
AFFO
	Basic	$	248,271		72,969
	Diluted	$	286,662		89,396

(1) Free Cash Flow, Earnings Before Structural Depreciation, Funds From Operations, and Adjusted Funds From Operations are measurement standards used by the Company’s management. These should not be considered alternatives to net income or net cash flow from operating activities, as determined in accordance with GAAP, as an indication of the Company’s performance or as a measure of liquidity.

18

• “Free Cash Flow” is defined by the Company as net operating income minus the capital spending required to maintain the related assets. It measures profitability prior to the cost of capital.

• “Earnings Before Structural Depreciation” (“EBSD”) is defined by the Company as Net Income, determined in accordance with GAAP, plus “structural depreciation”, i.e. depreciation of buildings and land improvements whose useful lives exceed 20 years.

• “Funds From Operations” (“FFO”) is defined by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”) as net income (loss), computed in accordance with generally accepted accounting principles (“GAAP”), excluding gains and losses from debt restructuring and sales of property, plus real estate related depreciation and amortization (excluding amortization of financing costs), and after adjustments for unconsolidated partnerships and joint ventures. The Company calculates FFO based on the NAREIT definition, as adjusted for minority interest in AIMCO Properties, L.P., amortization, the non-cash deferred portion of the income tax provision for unconsolidated subsidiaries and less the payment of dividends on preferred stock. There can be no assurance that the Company’s basis for computing FFO is comparable with that of other real estate investment trusts.

• “Adjusted Funds From Operations” (“AFFO”) is defined by the Company as FFO less a charge for capital replacements equal to $300 per apartment unit.

NOTE 9 — High Performance Units

      In January 1998, the Partnership sold an aggregate of 15,000 of its Class I High Performance Partnership Units (the “High Performance Units”) to a joint venture comprised of twelve members of AIMCO’s senior management and to three of its independent directors for a total of $2.1 million in cash. The High Performance Units have nominal value unless the Company’s total return (as defined below) over the three-year period ending December 31, 2000, is at least 30% and exceeds the industry average, as determined by a peer group index, by at least 15%. At the conclusion of the three year period, if the Company’s total return satisfies these criteria, the holders of the High Performance Units will receive distributions and allocations of income and loss from AIMCO Properties, L.P. in the same amounts and at the same times as would holders of a number of Common OP Units equal to the quotient obtained by dividing (i) the product of (a) 15% of the amount by which the Company’s cumulative total return over the three year period exceeds the greater of 115% of a peer group index or 30% (such excess being the “Excess Return”), multiplied by (b) the weighted average market value of the Company’s outstanding Class A Common Stock and Common OP Units, by (ii) the market value of one share of Class A Common Stock at the end of the three year period. The three-year measurement period will be shortened in the event of a change of control of the Company. Unlike Common OP Units, the High Performance Units are not redeemable or convertible into Class A Common Stock unless a change of control of the Company occurs. Because there is substantial uncertainty that the High Performance Units will have more than nominal value due to the required total return over the three-year term, the Company has not recorded any value to the High Performance Units in the consolidated financial statements as of September 30, 2000. The Company includes any dilutive effect of the High Performance Units in its earnings per unit calculations.

      The Morgan Stanley Dean Witter REIT Index is being used as the peer group index for purposes of the High Performance Units. The Morgan Stanley Dean Witter REIT Index is a capitalization-weighted index (with dividends reinvested) of the most actively traded real estate investment trusts. The Morgan Stanley Dean Witter REIT Index is comprised of over 100 real estate investment trusts selected by Morgan Stanley Dean Witter & Co. Incorporated. The Board of Directors of the Company has selected this index because it believes that it is the real estate investment trust index most widely reported and accepted among institutional investors.

      “Total return” means, for any security and for any period, the cumulative total return for such security over such period, as measured by (i) the sum of (a) the cumulative amount of dividends paid in respect of such security for such period (assuming that all cash dividends are reinvested in such security as of the payment date for such

19

dividend based on the security price on the dividend payment date), and (b) an amount equal to (x) the security price at the end of such period, minus (y) the security price at the beginning of such period, divided by (ii) the security price at the beginning of the measurement period; provided, however, that if the foregoing calculation results in a negative number, the total return shall be equal to zero. For purposes of calculating the total return of the AIMCO Class A Common Stock, the security price at the end of the period will be based on an average of the volume-weighted average daily trading price of the AIMCO Class A Common Stock for the 20 trading days immediately preceding the end of the period.

      The High Performance Units are not convertible into AIMCO Class A Common Stock. However, in the event of a change of control of the Company, holders of High Performance Units will have redemption rights similar to those of holders of Common OP Units. Upon the occurrence of a change of control, any holder of High Performance Units may, subject to certain restrictions, require the Partnership to redeem all or a portion of the High Performance Units held by such party in exchange for a cash payment per unit equal to the liquidation value of a unit at the time of redemption. However, in the event that any High Performance Units are tendered for redemption, the Partnership’s obligation to pay the redemption price is subject to the prior right of the Company to acquire such High Performance Units in exchange for an equal number of shares of AIMCO Class A Common Stock with a market value equivalent to the liquidation value of the units.

      If AIMCO’s total return over the measurement period exceeds 115% of the total return of the Morgan Stanley Dean Witter REIT Index and exceeds the minimum return (30% over three years), then the holders of High Performance Units could be entitled to a significant percentage of future distributions made by the Partnership. This could have a dilutive effect on future earnings per share of AIMCO Class A Common Stock, and on AIMCO’s equity ownership in the Partnership after the three-year measurement period.

      The following table illustrates the value of the 15,000 High Performance Units at the end of the three-year measurement period, assuming a range of different prices for the AIMCO Class A Common Stock at the end of the measurement period. For the period from January 1, 1998 to September 30, 2000, the cumulative total return of the Morgan Stanley Dean Witter REIT Index was (3.11%) and the cumulative total return of the AIMCO Class A Common Stock was 49.49%. As a result, for purposes of the illustration, we have assumed that the cumulative total return of the AIMCO Class A Common Stock will exceed 115% of the cumulative total return of the peer group index. This implies that the High Performance Units will only have value if the cumulative total return on the AIMCO Class A Common Stock from January 1, 1998 to January 1, 2001 exceeds 30%. We have also assumed, for purposes of the illustration, that the weighted average market value of outstanding equity (AIMCO Class A Common Stock and Common OP Units) during the measurement period is $2,531,024,164, which was the amount as of September 30, 2000.

20

      Please note that the table below is for illustrative purposes only and there can be no assurance that actual outcomes will be within the ranges used. Some of the factors that could affect the results set forth in the table are the total return of the AIMCO Class A Common Stock relative to the total return of the Morgan Stanley Dean Witter REIT Index, and the market value of the average outstanding equity of the Company during the measurement period. These factors may be affected by general economic conditions, local real estate conditions and the dividend policy of the Company.

															Value of
											Average		Excess		High
Stock		AIMCO									Market		Shareholder		Performance
Price		Total			Minimum			Excess			Capitalization		Value Added		Units
(12/31/00)		Return			Return			Return			(thousands)		(thousands)		(thousands)
					(1)			(2)			(3)		(4)		(5)
$	39.00		28.93	%		30.00	%		0.00	%	$	2,531,024	$	—	$	6
	39.51		30.58	%		30.00	%		0.58	%		2,531,024		14,680		2,202
	40.00		32.17	%		30.00	%		2.17	%		2,531,024		54,923		8,238
	41.00		35.41	%		30.00	%		5.41	%		2,531,024		136,928		20,539
	42.00		38.65	%		30.00	%		8.65	%		2,531,024		218,934		32,840
	43.00		41.89	%		30.00	%		11.89	%		2,531,024		300,939		45,141
	44.00		45.13	%		30.00	%		15.13	%		2,531,024		382,944		57,442
	45.00		48.37	%		30.00	%		18.37	%		2,531,024		464,949		69,742
	46.00		51.60	%		30.00	%		21.60	%		2,531,024		546,701		82,005
	47.00		54.84	%		30.00	%		24.84	%		2,531,024		628,706		94,306
	48.00		58.07	%		30.00	%		28.07	%		2,531,024		710,458		106,569
	49.00		61.31	%		30.00	%		31.31	%		2,531,024		792,464		118,870
	50.00		64.54	%		30.00	%		34.54	%		2,531,024		874,216		131,132

[Additional columns below]

[Continued from above table, first column(s) repeated]

							Cash
				OP Unit			Proceeds
				Dilution as			To Company
Stock		OP Unit		a % of total			From Initial
Price		Dilution		Diluted shares			Investment
(12/31/00)		(thousands)		Outstanding			(thousands)
		(6)		(7)			(8)
$	39.00		—		0.00	%	$	2,064
	39.51		56		0.06	%		2,064
	40.00		206		0.22	%		2,064
	41.00		501		0.55	%		2,064
	42.00		782		0.85	%		2,064
	43.00		1,050		1.15	%		2,064
	44.00		1,305		1.42	%		2,064
	45.00		1,550		1.69	%		2,064
	46.00		1,783		1.95	%		2,064
	47.00		2,007		2.19	%		2,064
	48.00		2,220		2.42	%		2,064
	49.00		2,426		2.65	%		2,064
	50.00		2,623		2.86	%		2,064

(1)	Assumes that the AIMCO total return will exceed that of the peer group by at least 15%.
(2)	“Excess Return” is the amount, if any, by which the total return of the AIMCO Class A Common Stock over the measurement period exceeds the minimum return.
(3)	Assumes the market value of outstanding equity (AIMCO Class A Common Stock and Common OP Units) at September 30, 2000 throughout the measurement period.
(4)	“Excess Shareholder Value Added” is calculated by multiplying the Excess Return by the average market capitalization.
(5)	The “Value of High Performance Units” is calculated by multiplying the Excess Shareholder Value Added by 15%. If Excess Shareholder Value Added is 0, the “Value of High Performance Units” is calculated by multiplying the stock price by 150 OP Units. The initial investment of $2,070,000 will continue to be treated as contributed equity on the balance sheet of the Partnership.
(6)	The “OP Unit Dilution” is calculated by dividing the Value of High Performance Units by the stock price at the end of the period.
(7)	“OP Unit Dilution as a % of Total Diluted Shares Outstanding” is calculated by dividing the OP Unit Dilution by the total weighted-average diluted units outstanding as of September 30, 2000.
(8)	If Excess Shareholder Value Added is $0, the “Cash Proceeds to Company from Initial Investment” is calculated by subtracting the “Value of High Performance Units” from $2,070,000, which is the purchase price of 15,000 High Performance Units.

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      The following table summarizes the status of the High Performance Units as of December 31, 1999 and September 30, 2000:

				Morgan Stanley									Average		Excess
	AIMCO Total			Dean Witter			Minimum			Excess			Market		Shareholder
As of	Return			REIT Index			Return			Return			Capitalization		Value Added(1)
December 31, 1999		22.71	%		-20.69	%		19.11	%		3.60	%	$	2,327,728,992	$	83,798,244
September 30, 2000		49.49	%		-3.11	%		27.19	%		22.30	%	$	2,531,024,164	$	564,418,389

[Additional columns below]

[Continued from above table, first column(s) repeated]

	Value of High
	Performance		OP Unit			OP Unit
As of	Units (2)		Dilution			Dilution %
December 31, 1999	$	12,569,737		340,096	(3)		0.40	%
September 30, 2000	$	84,662,758		1,867,132	(4)		2.04	%

(1)	Excess Return multiplied by average market capitalization
(2)	Excess Shareholder Value Added multiplied by 15%
(3)	OP Unit calculation based on trailing 20-day average stock price of $36.96
(4)	OP Unit calculation based on trailing 20-day average stock price of $45.34

NOTE 10 — Portfolios Held for Sale

      The Company is currently marketing for sale certain real estate properties as part of its policy to sell properties in the portfolio that are inconsistent with the Company’s long-term investment strategies (as determined by management from time to time). Approximately 6,400 units with an approximate carrying value of $80 million are included with real estate in the consolidated financial statements and approximately 18,500 units with an approximate carrying value of $101 million are included with investments in unconsolidated real estate partnerships in the consolidated financial statements. The Company does not expect to incur any material losses with respect to the sales of the properties.

NOTE 11 — Recent Accounting Developments

      In June 1998, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities (“Statement 133”). Statement 133 requires recording all derivative instruments as assets or liabilities, measured at fair value. Statement 133 is effective beginning after 2000. The Company has elected not to adopt early the provisions of Statement 133 as of December 31, 1999 and when Statement 133 is adopted, the Company does not expect the Statement to have a significant impact on its financial position and results of operations.

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NOTE 12 — Pro Forma Financial Statements

      The unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2000 and the nine months ended September 30, 1999 have been prepared as if each of the following transactions had occurred on January 1, 1999: (i) the Oxford acquisition (Note 3); (ii) the acquisition of the Regency Windsor Apartment Communities, which include fourteen separate residential apartment communities located in Indiana, Michigan and North Carolina; and (iii) the acquisition of the Dreyfuss Apartment Communities, which include nine separate residential apartment communities located in Virginia and Maryland.

      The pro forma financial statements are not necessarily indicative of what the Company’s results of operations would have been assuming the completion of the described transactions at the beginning of the periods indicated, nor does it purport to project the Company’s results of operations for any future period. The allocation of purchase costs are subject to final determination based upon estimates and other evaluations of fair market value.

PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per unit data)
(unaudited)

	For the Nine Months Ended September 30,
	2000			1999
Income from property operations	$	228,207		$	141,590
Company’s share of income from service company business		13,069			2,117
Net income	$	39,353		$	30,333
Net income attributable to preferred unitholders	$	50,476		$	46,667
Net loss attributable to common unitholders		($11,123	)		($16,334	)
Diluted loss per unit		($0.15	)		($0.23	)
Weighted average number of common units and common unit equivalents outstanding		75,986			71,184

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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

      As of September 30, 2000, the Company owned or managed 333,786 apartment units, comprised of 137,419 units in 500 apartment communities owned or controlled by the Company (the “Owned Properties”), 132,909 units in 769 apartment communities in which the Company has an equity interest (the “Equity Properties”) and 63,458 units in 487 apartment communities which the Company manages for third parties and affiliates (the “Managed Properties” and together with the Owned Properties and the Equity Properties, the “AIMCO Properties”). The apartment communities are located in 48 states, the District of Columbia and Puerto Rico.

      In the three months ended September 30, 2000, the Company completed $1.2 billion in acquisitions, dispositions, and mortgage financing transactions. The Company acquired all of the stock and other interests held by the principals, officers and directors of Oxford Realty Financial Group, Inc. in entities which own and control 167 properties with 36,949 apartment units as well as control of the managing general partner of Oxford Tax Exempt Fund II, an Amex listed partnership for $883 million. Additionally, the Company acquired five properties in the Dreyfuss portfolio from affiliates of Dreyfuss Brothers, Inc. for $55 million. The Company purchased $56 million of limited partnership interests. The Company sold 21 apartment communities and 4 land parcels for a total of $168 million of which the Company’s share of the dispositions was $79 million with a GAAP gain of $9 million. Third quarter refinancing activity included the closing of $63 million of new mortgages at a weighted average interest rate of 7.86%.

      The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements in certain circumstances. Certain information included in this Report contains or may contain information that is forward-looking, including, without limitation, statements regarding the effect of acquisitions, the Company’s 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 general level of interest rates; the terms of governmental regulations that affect the Company and interpretations of those regulations; the competitive environment in which the Company operates; financing risks, including the risk that the Company’s cash flows from operations may be insufficient to meet required payments of principal and interest; real estate risks, including variations of real estate values and the general economic climate in local markets and competition for tenants in such markets; acquisition and development risks, including failure of such acquisitions to perform in accordance with projections; and possible environmental liabilities, including costs which may be incurred due to necessary remediation of contamination of properties presently owned or previously owned by the Company. In addition, the Company’s current and continuing qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code and depends on its ability to meet the various requirements imposed by the Internal Revenue Code, through actual operating results, distributions levels and diversity of stock ownership. Readers should carefully review the Company’s financial statements and the notes thereto, as well as the risk factors described in documents the Company files from time to time with the Securities and Exchange Commission.

Results of Operations

Comparison of the Three Months Ended September 30, 2000 to the Three Months Ended September 30, 1999

Net Income

      The Company recognized net income of $33.5 million for the three months ended September 30, 2000, compared with $19.9 million for the three months ended September 30, 1999. The increase in net income of $13.6 million, or 68.3%, was the result of an increase in net “same store” property results, the acquisition of 28 properties during 1999 and six properties during 2000, and the acquisition of controlling interests in partnerships owning 246 properties with the subsequent consolidation of the purchased and newly controlled entities. The effect of the foregoing was partly offset by the sale of 46 properties.

24

Consolidated Rental Property Operations

      Rental and other property revenues from the consolidated Owned Properties totaled $271.1 million for the three months ended September 30, 2000, compared with $120.4 million for the three months ended September 30, 1999, an increase of $150.7 million, or 125.2%. The increase in rental and other property revenues reflects an increase in “same store” sales revenue of 5.5%; the purchase of 28 properties during 1999 and six properties in 2000; the acquisition of controlling interests in partnerships owning 246 properties; and the subsequent consolidation of the purchased and newly controlled entities. The effect of the foregoing was partly offset by the sale of 46 properties.

      Property operating expenses for the consolidated Owned Properties, consisting of on-site payroll costs, utilities (net of reimbursements received from tenants), contract services, turnover costs, repairs and maintenance, advertising and marketing, property taxes and insurance, totaled $107.0 million for the three months ended September 30, 2000, compared with $48.0 million for the three months ended September 30, 1999, an increase of $59.0 million or 122.9%. The increase in property operating expenses primarily was due to an increase in “same store” expenses of 1.5%; the purchase of 28 properties in 1999 and 6 properties in 2000; the acquisition of controlling interests in partnerships owning 246 properties; and the subsequent consolidation of the purchased and newly controlled entities. The effect of the foregoing was partly offset by the sale of 46 properties.

Service Company Business

      The Company’s share of income from the service company business totaled $3.7 million for the three months ended September 30, 2000, compared with a loss of $5.3 million for the three months ended September 30, 1999, an increase of $9 million or 169.8%. The increase was primarily due to the establishment of the new Corporate Housing program and other product enhancements, and a reduction in the use of third party information technology consultants.

General and Administrative Expenses

      General and administrative expenses were $4.5 million for the three months ended September 30, 2000 compared to $3.0 million for the three months ended September 30, 1999 an increase if $1.5 million, or 50.0%. This increase is primarily due to legal and accounting fees for operational initiatives and information technology enhancements.

Interest Expense

      Interest expense, which includes the amortization of deferred financing costs, totaled $67.9 million for the three months ended September 30, 2000, compared with $31.3 million for the three months ended September 30, 1999, an increase of $36.6 million, or 116.9%. The increase primarily was due to the Company acquiring controlling interests in partnerships owning 246 properties and the subsequent consolidation of these properties. The Company had also drawn $175 million on its credit facility with Bank of America, N.A. as of September 30, 2000 compared with $111.7 million at September 30, 1999. The cost of such borrowing was at a weighted average interest rate of 9.19% and 9.17% at September 30, 2000 and September 30, 1999, respectively.

Interest Income

      Interest income remained relatively unchanged, although interest accretion on discounted acquisition notes decreased, with $18.8 million for the three months ended September 30, 2000, and $17.6 million for the three months ended September 30, 1999.

25

Comparison of the Nine Months Ended September 30, 2000 to the Nine Months Ended September 30, 1999

Net Income

      The Company recognized net income of $75.1 million for the nine months ended September 30, 2000, compared with $58.7 million for the nine months ended September 30, 1999. The increase in net income of $16.4 million, or 27.9%, primarily was the result of an increase in net “same store” property results, the acquisition of 28 properties during 1999 and six properties during 2000, the completion of the merger of Insignia Properties Trust into AIMCO, the purchase of $271 million in limited partnership interests from unaffiliated third parties in 1999, and an increase in interest income on notes receivable from unconsolidated real estate partnerships in 2000. The effect of the foregoing on net income was partially offset by $18 million charged to operations for partnership losses or distributions in excess of the minority partners’ basis and the sale of 8 properties during 1999 and forty-six properties in 2000. These factors are discussed in more detail in the following paragraphs.

Consolidated Rental Property Operations

      Rental and other property revenues from the consolidated Owned Properties totaled $753.5 million for the nine months ended September 30, 2000, compared with $347.2 million for the nine months ended September 30, 1999, an increase of $406.3 million, or 117.0%. The increase in rental and other property revenues primarily was due to an increase in “same store” sales revenue of 4.9%, the purchase of 28 properties in 1999 and six properties in 2000, the acquisition of controlling interests in partnerships owning 246 properties, and the subsequent consolidation of the purchased and newly controlled entities. The effect of the foregoing was partly offset by the sale of 46 properties.

      Property operating expenses for the consolidated Owned Properties, consisting of on-site payroll costs, utilities (net of reimbursements received from tenants), contract services, turnover costs, repairs and maintenance, advertising and marketing, property taxes and insurance, totaled $302.4 million for the nine months ended September 30, 2000, compared with $135.6 million for the nine months ended September 30, 1999, an increase of $166.8 million or 123.0%. The increase in property operating expenses primarily was due to an increase in “same store” expenses of 2.6%, the purchase of 28 properties in 1999 and six properties in 2000, the acquisition of controlling interests in partnerships owning 246 properties, and the subsequent consolidation of the purchased and newly controlled entities. The effect of the foregoing was partly offset by the sale of 46 properties.

Service Company Business

      The Company’s share of income from the service company business was $13.3 million for the nine months ended September 30, 2000, compared with a loss of $2.3 million for the nine months ended September 30, 1999. The increase in service company business income of $15.6 million was mainly due to the establishment of the new Corporate Housing program and other product enhancements, and a reduction in the use of third party information technology consultants.

General and Administrative Expenses

      General and administrative expenses totaled $9.6 million for the nine months ended September 30, 2000 compared with $7.2 million for the nine months ended September 30, 1999. This increase of $2.4 million or 33.3% is due to legal and accounting fees for operational initiatives and information technology enhancements.

Interest Expense

      Interest expense, which includes the amortization of deferred financing costs, totaled $190.5 million for the nine months ended September 30, 2000, compared with $91.4 million for the nine months ended September 30, 1999, an increase of $99.1 million, or 108.4%. The increase primarily was due to the Company acquiring controlling interests in partnerships owning 246 properties and the subsequent consolidation of these properties, as well as the conversion costs associated with the TOPRS convertible preferred securities. The Company had also drawn $175.0 million on its credit facility with Bank of America, N.A. as of September 30, 2000 compared with $111.7 million at September 30, 1999. The cost of such borrowing was at a weighted average interest rate of 9.19% and 9.17% at September 30, 2000 and September 30, 1999, respectively.

26

Interest Income

      Interest income totaled $47.4 million for the nine months ended September 30, 2000, compared with $37.8 million for the nine months ended September 30, 1999. The increase of $9.6 million, or 25.4%, primarily is due to the recognition of interest accretion on discounted acquisition notes.

Funds From Operations

      For the three months and nine months ended September 30, 2000 and 1999, the Company’s Funds From Operations (“FFO”) on a fully diluted basis were as follows (dollars in thousands):

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
		2000			1999			2000			1999
Net Income		$	33,457		$	19,889		$	75,071		$	58,746
	Real estate depreciation, net of minority interest		72,564			27,152			206,298			78,960
	Real estate depreciation related to unconsolidated entities		16,672			29,204			51,235			73,950
	Amortization of intangibles		2,084			2,455			5,523			7,366
	Amortization of recoverable amount of management contracts		—			11,330			648			32,126
	Deferred tax (benefit) provision		(286	)		1,305			2,675			3,102
	Preferred stock dividends and distributions		(6,530	)		(7,208	)		(19,590	)		(26,735	)
	TOPRS interest expense		3,426			2,429			8,284			2,429
Dilutive Funds From Operations before gain on disposition of properties			121,387			86,556			330,144			229,944
	Gain on disposition of properties		(8,902	)		(315	)		(14,234	)		(330	)
Dilutive Funds From Operations available to common units		$	112,485		$	86,241		$	315,910		$	229,614
Weighted average number of units and common unit equivalents outstanding:
	Common OP units and common OP unit equivalents		85,308			77,691			83,068			69,204
	Preferred units convertible into common OP units		6,307			5,555			6,328			7,259
			91,615			83,246			89,396			76,463

      FFO increased to $112.5 million and $315.9 million for the three and nine months ended September 30, 2000, respectively, compared with $86.2 million and $229.6 million, respectively, for the same periods in 1999 primarily due to: increases in “same store” property operations; the acquisition and subsequent consolidation of newly controlled entities and controlling interests in partnerships owning 246 properties; and the purchase of 28 properties in 1999 and six properties in 2000; partly offset by the sale of 46 properties.

27

Same Store Property Operating Results

      The Company defines “same store” properties as apartment communities owned in the comparable periods of 2000 and 1999. The following table summarizes the unaudited consolidated rental property operations on a “same store” basis (dollars in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2000			1999			2000			1999
Properties		556			556			556			556
Apartment Units		152,195			152,195			152,195			152,195
Average Physical Occupancy		95.1	%		95.9	%		95.0	%		95.0	%
Average Rent Collected/Unit/Month	$	642		$	612		$	645		$	621
Revenues	$	211,338		$	200,246		$	621,450		$	592,695
Expenses		81,078			79,858			235,373			229,487
Net Operating Income	$	130,260		$	120,388		$	386,077		$	363,208

Liquidity and Capital Resources

      For the nine months ended September 30, 2000 and 1999, net cash flows were as follows (dollars in thousands):

	2000			1999
Cash flow provided by operating activities	$	281,185		$	163,852
Cash flow used in investing activities		(563,026	)		(151,534	)
Cash flow provided by (used in) financing activities		286,781			(8,947	)

      During the nine months ended September 30, 2000, the Company closed $270.4 million of long-term, fixed-rate, fully amortizing notes payable with a weighted average interest rate of 7.99%. Each of the notes is individually secured by one of nineteen properties with no cross-collateralization. The Company used the net proceeds totaling $265.5 million after transaction costs to repay existing debt and for working capital. During the nine months ended September 30, 2000, the Company has also assumed $38.2 million in long-term, fixed rate, fully amortizing notes-payable, with an interest rate of 7.70% in connection with the acquisition of six properties. The notes are secured by the acquired properties.

      In August 1999, the Company closed a $300 million revolving credit facility arranged by Bank of America, N.A., Fleet National Bank (successor in interest to BankBoston, N.A.) and First Union National Bank with a syndicate comprised of a total of nine lender participants. Effective March 15, 2000 the credit facility was expanded by $45 million with the potential to expand it by another $55 million to a total of $400 million. On April 14, 2000, the credit facility was expanded by $5 million to $350 million. In September 2000, the credit facility was amended and restated. The obligations under the credit facility are secured by a first priority pledge of certain non-real estate assets of the Company and a second priority pledge of the stock ownership of the Partnership, NHP Management Company, AIMCO/Bethesda Holdings, Inc., and AIMCO Holdings, L.P. in certain subsidiaries of AIMCO and certain options to purchase Beneficial Assignee Interests (“BACs”) in OTEF. Borrowings under the credit facility, including the $50 million expansion, are available for general corporate purposes. The credit facility matures in July 2002. The annual interest rate under the credit facility is based either on LIBOR or a base rate which is the higher of Bank of America’s reference rate or 0.5% over the federal funds rate, plus, in either case, an applicable margin. The margin ranges between 2.05% and 2.55%, in the case of LIBOR-based loans, and between 0.55% and 1.05%, in the case of base rate loans, based upon a fixed charge coverage ratio. The weighted average interest rate at September 30, 2000 was 9.19%. The amount available under different credit facilities at September 30, 2000 and 1999 was $175 million and $188.3 million, respectively.

28

      On September 20, 2000 the Company completed the purchase of all the stock and other interests (not already owned by AIMCO) held by the principals, officers and directors of Oxford Realty Financial Group Inc. (“ORFG”) in entities, including ORFG, which own interests in and control the Oxford properties for $266 million in cash and $62 million in Common OP Units. The Partnership borrowed $279 million to pay the cash portion of the purchase price and transaction costs for the Oxford acquisition from Bank of America, N.A., Lehman Commercial Paper Inc. and several other lenders, pursuant to a term loan with a total availability of $302 million. The borrowers under the term loan are the Partnership, NHP Management Company and AIMCO/Bethesda Holdings, Inc., and all obligations thereunder are guaranteed by AIMCO and certain of its subsidiaries. The obligations under the term loan are secured by a first priority pledge of the stock ownership of the Partnership, NHP Management Company, AIMCO/Bethesda Holding, Inc., and AIMCO Holdings, L.P. in certain subsidiaries of AIMCO and certain options to purchase BACs in OTEF and a second priority pledge of certain non-real estate assets of the Company. The annual interest rate under the term loan is based either on LIBOR or a base rate which is the higher of Bank of America’s reference rate or 0.5% over the federal funds rate, plus, in either case, an applicable margin. The margin ranges between 4.0% and 5.0% in the case of LIBOR-based loans and between 1.0% and 2.0% in the case of base rate loans, based upon the number of months the loan is outstanding. The term loan expires in July 2002. The financial covenants contained in the term loan require the Partnership to maintain a ratio of debt to gross asset value of no more than 0.55 to 1.0, and an interest coverage ratio of 2.25 to 1.0, and a fixed charge coverage ratio of at least 1.50 to 1.0. In addition, the term loan limits AIMCO from distributing more than 80% of its Funds From Operations (as defined) (or such amounts as may be necessary for AIMCO to maintain its status as a REIT), imposes minimum net worth requirements and provides other financial covenants related to certain of AIMCO’s assets and obligations.

      At September 30, 2000, the Company had $106.5 million in cash and cash equivalents. In addition, the Company had $113.5 million of restricted cash, primarily consisting of reserves and impounds held by lenders for capital expenditures, property taxes and insurance. The Company’s principal demands for liquidity include normal operating activities, payments of principal and interest on outstanding debt, capital improvements, acquisitions of or investments in properties, and distributions paid to unitholders. The Company considers its cash provided by operating activities, and funds available under its credit facilities, to be adequate to meet short-term liquidity demands. The Company utilizes its revolving credit facility for general corporate purposes and to fund investments on an interim basis.

      The Company expects to fund its requirements for property acquisitions, tender offers and refinancing of short-term debt with: long-term, fixed rate, fully amortizing debt; secured or unsecured short-term debt; the issuance of debt or equity securities in public offerings or private placements; and cash generated from operations.

      From time to time, the Company has offered to acquire and, in the future, may offer to acquire the interests held by third party investors in certain limited partnerships for which the Company acts as general partner. Any such acquisitions will require funds to pay the cash purchase price for such interests. During the nine months ended September 30, 2000, the Company made separate offers to the limited partners of 539 partnerships to acquire their limited partnership interests, and purchased approximately $117.9 million (including transaction costs) of limited partnership interests.

29

Return on Assets and Return on Partners’ Capital

      The Company’s Return On Assets and Return On Partners’ Capital for the nine months ended September 30, 2000 and 1999 are as follows:

		Based on AFFO						Based on FFO
		Nine Months Ended						Nine Months Ended
		September 30,						September 30,
		2000			1999			2000			1999
Return on Assets (a)			9.9	%		10.0	%		10.4	%		10.5	%
Return on Partners’ Capital
	Basic (b)		15.4	%		12.8	%		16.6	%		14.9	%
	Diluted (c)		14.8	%		11.9	%		15.9	%		13.6	%

(a)	The Company defines Return on Assets (AFFO) as (i) annualized Free Cash Flow, divided by (ii) Average Assets. Average Assets are computed by averaging the sum of Assets, as defined below, at the beginning and the end of the period. Assets are total assets, plus accumulated depreciation, less accumulated Capital Replacements of $77,863, for the nine months ended September 30, 2000, and less all non-indebtedness liabilities. The Company defines Return on Assets (FFO) as (i) annualized Free Cash Flow plus Capital Replacements, divided by (ii) Average Assets plus accumulated Capital Replacements.
(b)	The Company defines Return on Partners’ Capital-Basic (AFFO) as (i) annualized AFFO-Basic, divided by (ii) Average Partners’ Capital. Average Partners’ Capital is computed by averaging the sum of Partners’ Capital, as defined below, at the beginning and the end of the period. Partners’ Capital is total partners’ capital, plus accumulated depreciation, less accumulated Capital Replacements of $77,863 for the nine months ended September 30, 2000, less Preferred Units. The Company defines Return on Partners’ Capital-Basic (FFO) as (i) annualized AFFO-Basic plus Capital Replacements; divided by (ii) Average Partners’ Capital plus accumulated Capital Replacements.
(c)	The Company defines Return on Partners’ Capital-Diluted (AFFO) and Return on Partners’ Capital-Diluted (FFO) assuming conversion of debt and preferred securities whose conversion is dilutive.

Litigation

      The Company is a party to various legal actions resulting from its operating activities. These actions are routine litigation and administrative proceedings arising in the ordinary course of business, some of which are covered by liability insurance, and none of which are expected to have a material adverse effect on the consolidated financial condition or results of operations of the Company and its subsidiaries taken as a whole.

      In connection with the Company’s acquisitions of interests in limited partnerships that own properties, the Company and its affiliates are sometimes subject to legal actions, including allegations that such activities may involve breaches of fiduciary duties to the limited partners of such partnerships or violations of the relevant partnership agreements. The Company believes it complies with its fiduciary obligations and relevant partnership agreements, and does not expect any such legal actions to have a material adverse effect on the consolidated financial condition or results of operations of the Company and its subsidiaries taken as a whole.

Contingencies

Pending Investigations of HUD Management Arrangements

      In July 1999, the National Housing Partnership (“NHP”) received a grand jury subpoena requesting documents relating to NHP’s management of HUD-assisted or HUD-insured multi-family projects and NHP’s operation of a group purchasing program created by NHP, known as Buyers Access. The subpoena relates to the same subject matter as subpoenas NHP received in October and December of 1997 from the HUD Inspector General. To date,

30

neither the HUD Inspector General nor the grand jury has initiated any action against NHP or AIMCO or, to NHP’s or AIMCO’s knowledge, any owner of HUD property managed by NHP. AIMCO believes that NHP’s operations and programs are in compliance, in all material respects, with all laws, rules and regulations relating to HUD-assisted or HUD-insured properties. AIMCO is cooperating with the investigation and does not believe that the investigation will result in a material adverse effect on the financial condition of the Company. However, as with any similar investigation, there can be no assurance that these will not result in material fines, penalties or other costs that may impact the Company’s future results of operations or cash flows.

Environmental

      Various Federal, state and local laws subject property owners or operators to liability for 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 of the hazardous substances. The presence of, or the failure to properly remediate, hazardous substances may adversely affect occupancy at contaminated apartment communities and our ability to sell or borrow against contaminated properties. In addition to the costs associated with investigation and remediation actions brought by governmental agencies, the presence of hazardous wastes on a property could result in personal injury or similar claims by private plaintiffs. Various laws also impose liability for the cost of removal or remediation of hazardous substances at the disposal or treatment facility. Anyone who arranges for the disposal or treatment of hazardous or toxic 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 our properties, the Company could potentially be liable for environmental liabilities or costs associated with properties or properties it acquires or manages in the future.

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

      The Company’s primary market risk exposure relates to changes in interest rates. The Company is not subject to any foreign currency exchange rate risk or commodity price risk, or any other material market rate or price risks. The Company uses predominantly long-term, fixed-rate and self-amortizing non-recourse debt in order to avoid the refunding or repricing risks of short-term borrowings. The Company uses short-term debt financing and working capital primarily to fund acquisitions and generally expects to refinance such borrowings with proceeds from equity offerings or long-term debt financings.

      The Company had $552.9 million of variable rate debt outstanding at September 30, 2000, which represents 14.5% of the Company’s total outstanding debt. Based on this level of debt, an increase in interest rates of 1% would result in the Company’s income and cash flows being reduced by $5.5 million on an annual basis.

      The estimated aggregate fair value of the Company’s cash and cash equivalents, receivables, payables and short-term secured and unsecured debt as of September 30, 2000 is assumed to approximate their carrying value due to their relatively short terms. Management further believes that, after consideration of interest rate agreements, the fair market value of the Company’s secured tax-exempt bond debt and secured long-term debt approximates their carrying value, based on market comparisons to similar types of debt instruments having similar maturities.

31

PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings

      None.

ITEM 2. Changes in Securities and Use of Proceeds

      On September 20, 2000, the Company issued 1,381,704 Common OP Units, valued at $45 per unit, in connection with the acquisition of all of the stock and other interests held by the principals, officers and directors of ORFG and control of the managing general partner of OTEF.

      On September 13, 2000 AIMCO issued 4,000,000 shares of newly created Class N Preferred Stock in a direct placement. The proceeds of $100 million were contributed by AIMCO to the Partnership in exchange for 4,000,000 Class N Preferred Units and were used to repay certain indebtedness and for working capital. The Class N Preferred Units are redeemed or converted to Common OP Units when the shares of Class N Preferred Stock are redeemed or converted to Class A Common Stock.

      On September 13, 2000 AIMCO issued 1,904,762 shares of newly created Class O Preferred Stock to an institutional investor in a sale effected under AIMCO's shelf registration statement. The proceeds of $100 million were contributed by AIMCO to the Partnership in exchange for 1,904,762 Class O Preferred Units and were used to repay certain indebtedness and for working capital. The Class O Preferred Units are redeemed or converted to Common OP Units when the shares of Class O Preferred Stock are redeemed or converted to Class A Common Stock.

      In the three months ended September 30, 2000, the Partnership completed tender offers for limited partnership interests resulting in the issuance of 15,000 Class Two Partnership Preferred Units.

      In January 2000, the Company acquired Merrill House, a 159 unit apartment community for approximately $12.2 million, including the issuance of 205,937 Class Four Partnership Preferred Units valued at $5.2 million. During June 2000, 24,235 of the 205,937 Class Four Partnership Preferred Units issued were exchanged for cash and retired pursuant to the provisions of the purchase agreement. During July 2000, 3,445 of the remaining 181,702 Class Four Partnership Preferred Units issued were exchanged for cash and retired pursuant to the provisions of the purchase agreement.

      In September 2000, the Company acquired five apartment properties, with a combined total of 1,013 units for approximately $55 million, including the issuance of 807,016 Class Six Partnership Preferred Units valued at $20.2 million.

      During the three months ending September 30, 2000 the Company completed tender offers for limited partnership interests resulting in the issuance of 58,373 Common Units.

      All of the foregoing issuances of partnership units were made in private placement transactions exempt from registration under the Securities Act pursuant to Section 4(2) thereof.

ITEM 3. Defaults Upon Senior Securities

      None.

ITEM 4. Submission of Matters to a Vote of Security Holders

      None.

ITEM 5. Other Information

      None.

32

ITEM 6. Exhibits and Reports on Form 8-K

(a) Exhibits. The following exhibits are filed with this report (1):

EXHIBIT
NUMBER		DESCRIPTION
10.1	-	Fourteenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of September 12, 2000
10.2	-	Fifteenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of September 15, 2000
10.3	-	Sixteenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of September 15, 2000
10.4	-	Seventeenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of November 10, 2000
10.5	-	Interim Credit Agreement, dated as of September 20, 2000, among AIMCO Properties, L.P., NHP Management Company, AIMCO/Bethesda Holdings, Inc., Bank of America, N.A., Lehman Commercial Paper Inc. and several other lenders. (Exhibit (d) to AIMCO's Schedule 13D related to Oxford Tax Exempt Fund II Limited Partnership, dated September 20, 2000, is incorporated herein by this reference.)
10.6	-	Second Amended and Restated Credit Agreement, dated as of September 20, 2000, among AIMCO Properties, L.P., NHP Management Company, AIMCO/Bethesda Holdings, Inc., Bank of America, N.A. and several other lenders. (Exhibit (e) to AIMCO's Schedule 13D related to Oxford Tax Exempt Fund II Limited Partnership, dated September 20, 2000, is incorporated herein by this reference.)
10.7	-	Intercreditor and Subordination Agreement, dated as of September 20, 2000, among AIMCO Properties, L.P., NHP Management Company, AIMCO/Bethesda Holdings, Inc., Bank of America, N.A. and several other lenders. (Exhibit (f) to AIMCO's Schedule 13D related to Oxford Tax Exempt Fund II Limited Partnership, dated September 20, 2000, is incorporated herein by this reference.)
27.1	-	Financial Data Schedule
99.1	-	Agreement re: disclosure of long-term debt instruments

(1) Schedule and supplemental materials to the exhibits have been omitted but will be provided to the Securities and Exchange Commission upon request.

(b) Reports on Form 8-K for the quarter ended September 30, 2000:

During the quarter for which this report is filed, AIMCO Properties, L.P. filed its Current Report on Form 8-K, dated September 20, 2000, relating to the acquisition by AIMCO Properties, L.P. and Apartment Investment and Management Company of all the stock of certain affiliates of Oxford Realty Financial Group, Inc. which own and control 167 apartment communities.

33

AIMCO PROPERTIES, L.P.

SIGNATURES

      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.

AIMCO Properties, L.P.
By: AIMCO-GP, Inc. its General Partner

By:      /s/ PAUL J. McAULIFFE     
Paul J. McAuliffe
Executive Vice President,
Chief Financial Officer
(duly authorized officer and
principal financial officer)

By:     /s/ THOMAS C. NOVOSEL     
Thomas C. Novosel
Senior Vice President,
Chief Accounting Officer

Date: November 14, 2000

34

EXHIBIT INDEX(1)

EXHIBIT
NUMBER		DESCRIPTION
10.1	-	Fourteenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of September 12, 2000
10.2	-	Fifteenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of September 15, 2000
10.3	-	Sixteenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of September 15, 2000
10.4	-	Seventeenth Amendment to the Third Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of November  10, 2000
10.5	-	Interim Credit Agreement, dated as of September 20, 2000, among AIMCO Properties, L.P., NHP Management Company, AIMCO/Bethesda Holdings, Inc., Bank of America, N.A., Lehman Commercial Paper Inc. and several other lenders. (Exhibit (d) to AIMCO's Schedule 13D related to Oxford Tax Exempt Fund II Limited Partnership, dated September 20, 2000, is incorporated herein by this reference.)
10.6	-	Second Amended and Restated Credit Agreement, dated as of September 20, 2000, among AIMCO Properties, L.P., NHP Management Company, AIMCO/Bethesda Holdings, Inc., Bank of America, N.A. and several other lenders. (Exhibit (e) to AIMCO's Schedule 13D related to Oxford Tax Exempt Fund II Limited Partnership, dated September 20, 2000, is incorporated herein by this reference.)
10.7	-	Intercreditor and Subordination Agreement, dated as of September 20, 2000, among AIMCO Properties, L.P., NHP Management Company, AIMCO/Bethesda Holdings, Inc., Bank of America, N.A. and several other lenders. (Exhibit (f) to AIMCO's Schedule 13D related to Oxford Tax Exempt Fund II Limited Partnership, dated September 20, 2000, is incorporated herein by this reference.)
27.1	-	Financial Data Schedule
99.1	-	Agreement re: disclosure of long-term debt instruments

(1) Schedule and supplemental materials to the exhibits have been omitted but will be provided to the Securities and Exchange Commission upon request.

EX-10.1

   1
                                                                    EXHIBIT 10.1

                           FOURTEENTH AMENDMENT TO THE
                     THIRD AMENDED AND RESTATED AGREEMENT OF
                  LIMITED PARTNERSHIP OF AIMCO PROPERTIES, L.P.


         This FOURTEENTH AMENDMENT TO THE THIRD AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP OF AIMCO PROPER TIES, L.P., dated as of September 12,
2000 (this "Amendment"), is being executed by AIMCO-GP, Inc., a Delaware
corporation (the "General Partner"), as the general partner of AIMCO Properties,
L.P., a Delaware limited partnership (the "Partner ship"), pursuant to the
authority conferred on the General Partner by Section 7.3.C(7) of the Third
Amended and Restated Agreement of Limited Partnership of AIMCO Properties, L.P.,
dated as of July 29, 1994, as amended and/or supplemented from time to time (the
"Agreement"). Capitalized terms used, but not otherwise defined herein, shall
have the respective meanings ascribed thereto in the Agreement.

         WHEREAS, pursuant to Section 4.2.A of the Agreement, the General
Partner is authorized to determine the designations, preferences and relative,
participating, optional or other special rights, powers and duties of
Partnership Preferred Units.

         NOW, THEREFORE, in consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

         1. The Agreement is hereby amended by the addition of a new exhibit,
entitled "Exhibit Y," in the form attached hereto, which shall be attached to
and made a part of the Agreement.

         2. Except as specifically amended hereby, the terms, covenants,
provisions and conditions of the Agreement shall remain unmodified and continue
in full force and effect and, except as amended hereby, all of the terms,
covenants, provisions and conditions of the Agreement are hereby ratified and
confirmed in all respects.


   2


         IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.

                                       GENERAL PARTNER:

                                       AIMCO-GP, INC.

                                       By: /s/ PETER K. KOMPANIEZ
                                           ----------------------------------
                                           Name: Peter K. Kompaniez
                                           Title: President and Vice Chairman


   3


                                    EXHIBIT Y

                       PARTNERSHIP UNIT DESIGNATION OF THE
                       CLASS N PARTNERSHIP PREFERRED UNITS
                            OF AIMCO PROPERTIES, L.P.


         1. NUMBER OF UNITS AND DESIGNATION.

         A class of Partnership Preferred Units is hereby designated as "Class N
Partnership Preferred Units," and the number of Partnership Preferred Units
constituting such class shall be 4,000,000.

         2. DEFINITIONS.

         For purposes of the Class N Partnership Preferred Units, the following
terms shall have the meanings indicated in this Section 2, and capitalized terms
used and not otherwise defined herein shall have the meanings assigned thereto
in the Agreement:

         "Agreement" shall mean the Third Amended and Restated Agreement of
         Limited Partnership of the Partnership, dated as of July 29, 1994, as
         amended.

         "Call Date" shall have the meaning set forth in paragraph (a) of
         Section 5 of this Exhibit Y.

         "Class N Partnership Preferred Unit" means a Partnership Preferred Unit
         with the designations, preferences and relative, participating,
         optional or other special rights, powers and duties as are set forth in
         this Exhibit Y. It is the intention of the General Partner that each
         Class N Partnership Preferred Unit shall be substantially the economic
         equivalent of one share of Class N Preferred Stock.

         "Class N Preferred Stock" means the Class N Convertible Cumulative
         Preferred Stock, par value $0.01 per share, of the Previous General
         Partner.

         "Code" shall mean the Internal Revenue Code of 1986, as amended from
         time to time, or any successor statute thereto. Reference to any
         provision of the Code shall mean such provision as in effect from time
         to time, as the same may be amended, and any successor thereto, as
         interpreted by any applicable regulations or other administrative
         pronouncements as in effect from time to time.


                                       Y-1

   4


         "Common Stock" shall mean the Class A Common Stock, $.01 par value per
         share, of the Previous General Partner or such shares of the Previous
         General Partner's capital stock into which outstanding shares of Common
         Stock shall be reclassified.

         "Distribution Payment Date" shall mean any date on which cash dividends
         are paid on all outstanding shares of the Class N Preferred Stock.

         "Junior Partnership Units" shall have the meaning set forth in
         paragraph (c) of Section 8 of this Exhibit Y.

         "Parity Partnership Units" shall have the meaning set forth in
         paragraph (b) of Section 8 of this Exhibit Y.

         "Partnership" shall mean AIMCO Properties, L.P., a Delaware limited
         partnership.

         "Senior Partnership Units" shall have the meaning set forth in
         paragraph (a) of Section 8 of this Exhibit Y.

         3. DISTRIBUTIONS.

         On every Distribution Payment Date, the holders of Class N Partnership
Preferred Units shall be entitled to receive distributions payable in cash in an
amount per Class N Partnership Preferred Unit equal to the per share dividend
payable on the Class N Preferred Stock on such Distribution Payment Date. Each
such distribution shall be payable to the holders of record of the Class N
Partnership Preferred Units, as they appear on the records of the Partnership at
the close of business on the record date for the dividend payable with respect
to the Class N Preferred Stock on such Distribution Payment Date. Holders of
Class N Partnership Preferred Units shall not be entitled to any distributions
on the Class N Partnership Preferred Units, whether payable in cash, property or
stock, except as provided herein.

         4. LIQUIDATION PREFERENCE.

                  (a) In the event of any liquidation, dissolution or winding up
of the Partnership, whether voluntary or involuntary, before any payment or
distribution of the Partnership (whether capital, surplus or otherwise) shall be
made to or set apart for the holders of Junior Partnership Units, the holders of
Class N Partnership Preferred Units shall be entitled to receive Twenty-Five
Dollars ($25) per Class N Partnership Preferred


                                       Y-2
   5


Unit (the "Liquidation Preference"), plus an amount per Class N Partnership
Preferred Unit equal to all dividends (whether or not declared or earned)
accumulated, accrued and unpaid on one share of Class N Preferred Stock to the
date of final distribution to such holders; but such holders shall not be
entitled to any further payment. Until the holders of the Class N Partnership
Preferred Units have been paid the Liquidation Preference in full, plus an
amount equal to all dividends (whether or not declared or earned) accumulated,
accrued and unpaid on the Class N Preferred Stock to the date of final
distribution to such holders, no payment shall be made to any holder of Junior
Partnership Units upon the liquidation, dissolution or winding up of the
Partnership. If, upon any liquidation, dissolution or winding up of the
Partnership, the assets of the Partnership, or proceeds thereof, distributable
among the holders of Class N Partnership Preferred Units shall be insufficient
to pay in full the preferential amount aforesaid and liquidating payments on any
Parity Partnership Units, then such assets, or the proceeds thereof, shall be
distributed among the holders of Class N Partnership Preferred Units and any
such Parity Partnership Units ratably in the same proportion as the respective
amounts that would be payable on such Class N Partnership Preferred Units and
any such other Parity Partnership Units if all amounts payable thereon were paid
in full. For the purposes of this Section 4, (i) a consolidation or merger of
the Partnership with one or more partnerships, or (ii) a sale or transfer of all
or substantially all of the Partner ship's assets shall not be deemed to be a
liquidation, dissolution or winding up, voluntary or involuntary, of the
Partnership.

                  (b) Upon any liquidation, dissolution or winding up of the
Partnership, after payment shall have been made in full to the holders of Class
N Partnership Preferred Units and any Parity Partnership Units, as provided in
this Section 4, any other series or class or classes of Junior Partnership Units
shall, subject to the respective terms thereof, be entitled to receive any and
all assets remaining to be paid or distributed, and the holders of the Class N
Partnership Preferred Units and any Parity Partnership Units shall not be
entitled to share therein.

         5. REDEMPTION.

         Class N Partnership Preferred Units shall be redeemable by the
Partnership as follows:

                  (a) At any time that the Previous General Partner exercises
its right to redeem all or any of the shares of Class N Preferred Stock, the
General Partner shall cause the Partnership to redeem an equal number of Class N
Partnership Preferred Units, at a redemption price per Class N Partnership
Preferred Unit equal to the same price paid by the Previous General Partner to
redeem the Class N Preferred Stock and such


                                       Y-3
   6


price shall be paid in the same manner (including but not limited to, by means
of issuance of long-term indebtedness for purpose of such redemption) as paid by
the Previous General Partner for the Class N Preferred Stock redeemed (the "Call
Date"), in the manner set forth herein; provided, however, that in the event of
a redemption of Class N Partnership Preferred Units, if the Call Date occurs
after a dividend record date for the Class N Preferred Stock and on or prior to
the related Distribution Payment Date, the distribution payable on such
Distribution Payment Date in respect of such Class N Partnership Preferred Units
called for redemption shall be payable on such Distribution Payment Date to the
holders of record of such Class N Partnership Preferred Units on the applicable
dividend record date, and shall not be payable as part of the redemption price
for such Class N Partnership Preferred Units.

                  (b) If the Partnership shall redeem Class N Partnership
Preferred Units pursuant to paragraph (a) of this Section 5, from and after the
Call Date (unless the Partnership shall fail to make available the amount of
cash or other forms of consideration necessary to effect such redemption), (i)
except for payment of the redemption price, the Partnership shall not make any
further distributions on the Class N Partnership Preferred Units so called for
redemption, (ii) said units shall no longer be deemed to be outstanding, and
(iii) all rights of the holders thereof as holders of Class N Partnership
Preferred Units of the Partnership shall cease except the rights to receive the
cash payable upon such redemption, without interest thereon; provided, however,
that if a Call Date occurs after a dividend record date for the Class N
Preferred Stock and on or prior to the related Distribution Payment Date, the
full distribution payable on such Distribution Payment Date in respect of such
Class N Partnership Preferred Units called for redemption shall be payable on
such Distribution Payment Date to the holders of record of such Class N
Partnership Preferred Units on the applicable dividend record date
notwithstanding the prior redemption of such Class N Partnership Preferred
Units. No interest shall accrue for the benefit of the holders of Class N
Partnership Preferred Units to be redeemed on any cash set aside by the
Partnership.

         6. STATUS OF REACQUIRED UNITS.

         All Class N Partnership Preferred Units which shall have been issued
and reacquired in any manner by the Partnership shall be deemed cancelled.

         7. CONVERSION.

         Class N Partnership Preferred Units shall be convertible as follows:


                                       Y-4
   7


                  (a) Upon any conversion of shares of Class N Preferred Stock
into shares of Common Stock, the General Partner shall cause a number of Class N
Partnership Preferred Units equal to the number of such converted shares of
Class N Preferred Stock to be converted by the holders thereof into Partnership
Common Units. The conversion ratio in effect from time to time for the
conversion of Class N Partnership Preferred Units into Partnership Common Units
pursuant to this Section 7 shall at all times be equal to, and shall be
automatically adjusted as necessary to reflect, the conversion ratio in effect
from time to time for the conversion of Class N Preferred Stock into Common
Stock.

                  (b) In the event of a conversion of any Class N Partnership
Preferred Units, the Partnership shall make a cash payment to the holder thereof
equal to the cash payment required to be made by the Previous General Partner to
the holder of the shares of Class N Preferred Stock the conversion of which
required the conversion of such Class N Partnership Preferred Units. Holders of
Class N Partnership Preferred Units at the close of business on a distribution
payment record date shall be entitled to receive the distribution payable on
such units on the corresponding Distribution Payment Date notwithstanding the
conversion thereof following such distribution payment record date and prior to
such Distribution Payment Date. Except as provided above, the Partnership shall
make no payment or allowance for unpaid distributions on converted units or for
distributions on the Partnership Common Units issued upon such conversion. Each
conversion of Class N Partnership Preferred Units into Partnership Common Units
shall be deemed to have been effected at the same time and date that the
corresponding conversion of Class N Preferred Stock into Common Stock is deemed
to have been effected.

                  (c) No fractional Partnership Common Units shall be issued
upon conversion of Class N Partnership Preferred Units. Instead of any
fractional Partnership Common Units that would otherwise be deliverable upon the
conversion of Class N Partnership Preferred Units, the Partnership shall pay to
the holder of such converted units an amount in cash equal to the cash payable
to a holder of an equivalent number of converted shares of Class N Preferred
Stock in lieu of fractional shares of Common Stock.

                  (d) The Partnership will pay any and all documentary stamp or
similar issue or transfer taxes payable in respect of (i) the issue or delivery
of Partnership Common Units or other securities or property on conversion or
redemption of Class N Partnership Preferred Units pursuant hereto, and (ii) the
issue or delivery of Common Stock or other securities or property on conversion
or redemption of Class N Preferred Stock pursuant to the terms hereof.


                                       Y-5
   8


         8. RANKING.

         Any class or series of Partnership Units of the Partnership shall be
deemed to rank:

                  (a) prior or senior to the Class N Partnership Preferred
Units, as to the payment of distributions and as to distributions of assets upon
liquidation, dissolution or winding up, if the holders of such class or series
shall be entitled to the receipt of distributions and of amounts distributable
upon liquidation, dissolution or winding up, as the case may be, in preference
or priority to the holders of Class N Partnership Preferred Units ("Senior
Partnership Units");

                  (b) on a parity with the Class N Partnership Preferred Units,
as to the payment of distributions and as to distribution of assets upon
liquidation, dissolution or winding up, whether or not the distribution rates,
distribution payment dates or redemption or liquidation prices per unit or other
denomination thereof be different from those of the Class N Partnership
Preferred Units if (i) such class or series of Partnership Units shall be Class
B Partnership Preferred Units, Class C Partnership Preferred Units, Class D
Partnership Preferred Units, Class G Partnership Preferred Units, Class H
Partnership Preferred Units, Class I Partnership Preferred Units, Class J
Partnership Preferred Units, Class K Partnership Preferred Units, Class L
Partnership Preferred Units, Class M Partnership Preferred Units, Class One
Partnership Preferred Units, Class Two Partnership Preferred Units, Class Three
Partnership Preferred Units, Class Four Partnership Preferred Units, or Class
Six Partnership Preferred Units, or (ii) the holders of such class or series of
Partnership Units and the Class N Partnership Preferred Units shall be entitled
to the receipt of distributions and of amounts distributable upon liquidation,
dissolution or winding up in proportion to their respective amounts of accrued
and unpaid distributions per unit or other denomination or liquidation
preferences, without preference or priority one over the other (the Partnership
Units referred to in clauses (i) and (ii) of this paragraph being hereinafter
referred to, collectively, as "Parity Partnership Units"); and

                  (c) junior to the Class N Partnership Preferred Units, as to
the payment of distributions and as to the distribution of assets upon
liquidation, dissolution or winding up, if (i) such class or series of
Partnership Units shall be Partnership Common Units, Class I High Performance
Partnership Units, or Class Five Partnership Preferred Units, or (ii) the
holders of Class N Partnership Preferred Units shall be entitled to receipt of
distributions or of amounts distributable upon liquidation, dissolution or
winding up, as the case may be, in preference or priority to the holders of such
class or series of Partnership Units (the Partnership Units referred to in
clauses (i)


                                       Y-6
   9


and (ii) of this paragraph being hereinafter referred to, collectively, as
"Junior Partnership Units").

         9. SPECIAL ALLOCATIONS.

                  (a) Gross income and, if necessary, gain shall be allocated to
the holders of Class N Partnership Preferred Units for any Fiscal Year (and, if
necessary, subsequent Fiscal Years) to the extent that the holders of Class N
Partnership Preferred Units receive a distribution on any Class N Partnership
Preferred Units (other than an amount included in any redemption pursuant to
Section 5 hereof) with respect to such Fiscal Year.

                  (b) If any Class N Partnership Preferred Units are redeemed
pursuant to Section 5 hereof, for the Fiscal Year that includes such redemption
(and, if necessary, for subsequent Fiscal Years) (a) gross income and gain (in
such relative proportions as the General Partner in its discretion shall
determine) shall be allocated to the holders of Class N Partnership Preferred
Units to the extent that the redemption amounts paid or payable with respect to
the Class N Partnership Preferred Units so redeemed exceeds the aggregate
Capital Contributions (net of liabilities assumed or taken subject to by the
Partnership) per Class N Partnership Preferred Unit allocable to the Class N
Partnership Preferred Units so redeemed and (b) deductions and losses (in such
relative proportions as the General Partner in its discretion shall determine)
shall be allocated to the holders of Class N Partnership Preferred Units to the
extent that the aggregate Capital Contributions (net of liabilities assumed or
taken subject to by the Partnership) per Class N Partnership Preferred Unit
allocable to the Class N Partnership Preferred Units so redeemed exceeds the
redemption amount paid or payable with respect to the Class N Partnership
Preferred Units so redeemed.

         10. RESTRICTIONS ON OWNERSHIP.

         The Class N Partnership Preferred Units shall be owned and held solely
by the General Partner or the Special Limited Partner.

         11. GENERAL.

                  (a) The ownership of Class N Partnership Preferred Units may
(but need not, in the sole and absolute discretion of the General Partner) be
evidenced by one or more certificates. The General Partner shall amend Exhibit A
to the Agreement from time to time to the extent necessary to reflect accurately
the issuance of, and subsequent


                                       Y-7
   10


conversion, redemption, or any other event having an effect on the ownership of,
Class N Partnership Preferred Units.

                  (b) The rights of the General Partner and the Special Limited
Partner, in their capacity as holders of the Class N Partnership Preferred
Units, are in addition to and not in limitation of any other rights or authority
of the General Partner or the Special Limited Partner, respectively, in any
other capacity under the Agreement or applicable law. In addition, nothing
contained herein shall be deemed to limit or otherwise restrict the authority of
the General Partner or the Special Limited Partner under the Agreement, other
than in their capacity as holders of the Class L Partnership Preferred Units.


                                       Y-8

EX-10.2

   1
                                                                    EXHIBIT 10.2

                           FIFTEENTH AMENDMENT TO THE
                     THIRD AMENDED AND RESTATED AGREEMENT OF
                  LIMITED PARTNERSHIP OF AIMCO PROPERTIES, L.P.


         This FIFTEENTH AMENDMENT TO THE THIRD AMENDED AND RESTATED AGREEMENT OF
LIMITED PARTNERSHIP OF AIMCO PROPER TIES, L.P., dated as of September 15, 2000
(this "Amendment"), is being executed by AIMCO-GP, Inc., a Delaware corporation
(the "General Partner"), as the general partner of AIMCO Properties, L.P., a
Delaware limited partnership (the "Partner ship"), pursuant to the authority
conferred on the General Partner by Section 7.3.C(7) of the Third Amended and
Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of
July 29, 1994, as amended and/or supplemented from time to time (the
"Agreement"). Capitalized terms used, but not otherwise defined herein, shall
have the respective meanings ascribed thereto in the Agreement.

         WHEREAS, pursuant to Section 4.2.A of the Agreement, the General
Partner is authorized to determine the designations, preferences and relative,
participating, optional or other special rights, powers and duties of
Partnership Preferred Units.

         NOW, THEREFORE, in consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

         1. The Agreement is hereby amended by the addition of a new exhibit,
entitled "Exhibit Z," in the form attached hereto, which shall be attached to
and made a part of the Agreement.

         2. Except as specifically amended hereby, the terms, covenants,
provisions and conditions of the Agreement shall remain unmodified and continue
in full force and effect and, except as amended hereby, all of the terms,
covenants, provisions and conditions of the Agreement are hereby ratified and
confirmed in all respects.


   2


         IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.

                                            GENERAL PARTNER:

                                            AIMCO-GP, INC.


                                            By: /s/ JOEL F. BONDER
                                                -------------------------------
                                                Name: Joel F. Bonder
                                                Title: Executive Vice President


   3

                                    EXHIBIT Z

                       PARTNERSHIP UNIT DESIGNATION OF THE
                       CLASS O PARTNERSHIP PREFERRED UNITS
                            OF AIMCO PROPERTIES, L.P.


         1. NUMBER OF UNITS AND DESIGNATION.

         A class of Partnership Preferred Units is hereby designated as "Class O
Partnership Preferred Units," and the number of Partnership Preferred Units
constituting such class shall be 1,904,762.

         2. DEFINITIONS.

         For purposes of the Class O Partnership Preferred Units, the following
terms shall have the meanings indicated in this Section 2, and capitalized terms
used and not otherwise defined herein shall have the meanings assigned thereto
in the Agreement:

         "Agreement" shall mean the Third Amended and Restated Agreement of
         Limited Partnership of the Partnership, dated as of July 29, 1994, as
         amended.

         "Call Date" shall have the meaning set forth in paragraph (a) of
         Section 5 of this Exhibit Z.

         "Class O Partnership Preferred Unit" means a Partnership Preferred Unit
         with the designations, preferences and relative, participating,
         optional or other special rights, powers and duties as are set forth in
         this Exhibit Z. It is the intention of the General Partner that each
         Class O Partnership Preferred Unit shall be substantially the economic
         equivalent of one share of Class O Preferred Stock.

         "Class O Preferred Stock" means the Class O Convertible Cumulative
         Preferred Stock, par value $0.01 per share, of the Previous General
         Partner.

         "Code" shall mean the Internal Revenue Code of 1986, as amended from
         time to time, or any successor statute thereto. Reference to any
         provision of the Code shall mean such provision as in effect from time
         to time, as the same may be amended, and any successor thereto, as
         interpreted by any applicable regulations or other administrative
         pronouncements as in effect from time to time.


                                       Z-1
   4


         "Common Stock" shall mean the Class A Common Stock, $.01 par value per
         share, of the Previous General Partner or such shares of the Previous
         General Partner's capital stock into which outstanding shares of Common
         Stock shall be reclassified.

         "Distribution Payment Date" shall mean any date on which cash dividends
         are paid on all outstanding shares of the Class O Preferred Stock.

         "Junior Partnership Units" shall have the meaning set forth in
         paragraph (c) of Section 8 of this Exhibit Z.

         "Parity Partnership Units" shall have the meaning set forth in
         paragraph (b) of Section 8 of this Exhibit Z.

         "Partnership" shall mean AIMCO Properties, L.P., a Delaware limited
         partnership.

         "Senior Partnership Units" shall have the meaning set forth in
         paragraph (a) of Section 8 of this Exhibit Z.

         3. DISTRIBUTIONS.

         On every Distribution Payment Date, the holders of Class O Partnership
Preferred Units shall be entitled to receive distributions payable in cash in an
amount per Class O Partnership Preferred Unit equal to the per share dividend
payable on the Class O Preferred Stock on such Distribution Payment Date. Each
such distribution shall be payable to the holders of record of the Class O
Partnership Preferred Units, as they appear on the records of the Partnership at
the close of business on the record date for the dividend payable with respect
to the Class O Preferred Stock on such Distribution Payment Date. Holders of
Class O Partnership Preferred Units shall not be entitled to any distributions
on the Class O Partnership Preferred Units, whether payable in cash, property or
stock, except as provided herein.

         4. LIQUIDATION PREFERENCE.

                  (a) In the event of any liquidation, dissolution or winding up
of the Partnership, whether voluntary or involuntary, before any payment or
distribution of the Partnership (whether capital, surplus or otherwise) shall be
made to or set apart for the holders of Junior Partnership Units, the holders of
Class O Partnership Preferred Units shall be entitled to receive Fifty-Two
Dollars and Fifty Cents ($52.50) per Class O


                                       Z-2

   5



Partnership Preferred Unit (the "Liquidation Preference"), plus an amount per
Class O Partnership Preferred Unit equal to all dividends (whether or not
declared or earned) accumulated, accrued and unpaid on one share of Class O
Preferred Stock to the date of final distribution to such holders; but such
holders shall not be entitled to any further payment. Until the holders of the
Class O Partnership Preferred Units have been paid the Liquidation Preference in
full, plus an amount equal to all dividends (whether or not declared or earned)
accumulated, accrued and unpaid on the Class O Preferred Stock to the date of
final distribution to such holders, no payment shall be made to any holder of
Junior Partnership Units upon the liquidation, dissolution or winding up of the
Partnership. If, upon any liquidation, dissolution or winding up of the
Partnership, the assets of the Partnership, or proceeds thereof, distributable
among the holders of Class O Partnership Preferred Units shall be insufficient
to pay in full the preferential amount aforesaid and liquidating payments on any
Parity Partnership Units, then such assets, or the proceeds thereof, shall be
distributed among the holders of Class O Partnership Preferred Units and any
such Parity Partnership Units ratably in the same proportion as the respective
amounts that would be payable on such Class O Partnership Preferred Units and
any such other Parity Partnership Units if all amounts payable thereon were paid
in full. For the purposes of this Section 4, (i) a consolidation or merger of
the Partnership with one or more partnerships, or (ii) a sale or transfer of all
or substantially all of the Partnership's assets shall not be deemed to be a
liquidation, dissolution or winding up, voluntary or involuntary, of the
Partnership.

                  (b) Upon any liquidation, dissolution or winding up of the
Partnership, after payment shall have been made in full to the holders of Class
O Partnership Preferred Units and any Parity Partnership Units, as provided in
this Section 4, any other series or class or classes of Junior Partnership Units
shall, subject to the respective terms thereof, be entitled to receive any and
all assets remaining to be paid or distributed, and the holders of the Class O
Partnership Preferred Units and any Parity Partnership Units shall not be
entitled to share therein.

         5. REDEMPTION.

         Class O Partnership Preferred Units shall be redeemable by the
Partnership as follows:

                  (a) At any time that the Previous General Partner exercises
its right to redeem all or any of the shares of Class O Preferred Stock, the
General Partner shall cause the Partnership to redeem an equal number of Class O
Partnership Preferred Units, at a redemption price per Class O Partnership
Preferred Unit equal to the same price paid by the Previous General Partner to
redeem the Class O Preferred Stock and such


                                       Z-3
   6


price shall be paid in the same manner (including but not limited to, by means
of issuance of long-term indebtedness for purpose of such redemption) as paid by
the Previous General Partner for the Class O Preferred Stock redeemed (the "Call
Date"), in the manner set forth herein; provided, however, that in the event of
a redemption of Class O Partnership Preferred Units, if the Call Date occurs
after a dividend record date for the Class O Preferred Stock and on or prior to
the related Distribution Payment Date, the distribution payable on such
Distribution Payment Date in respect of such Class O Partnership Preferred Units
called for redemption shall be payable on such Distribution Payment Date to the
holders of record of such Class O Partnership Preferred Units on the applicable
dividend record date, and shall not be payable as part of the redemption price
for such Class O Partnership Preferred Units.

                  (b) If the Partnership shall redeem Class O Partnership
Preferred Units pursuant to paragraph (a) of this Section 5, from and after the
Call Date (unless the Partnership shall fail to make available the amount of
cash or other forms of consideration necessary to effect such redemption), (i)
except for payment of the redemption price, the Partnership shall not make any
further distributions on the Class O Partnership Preferred Units so called for
redemption, (ii) said units shall no longer be deemed to be outstanding, and
(iii) all rights of the holders thereof as holders of Class O Partnership
Preferred Units of the Partnership shall cease except the rights to receive the
cash payable upon such redemption, without interest thereon; provided, however,
that if a Call Date occurs after a dividend record date for the Class O
Preferred Stock and on or prior to the related Distribution Payment Date, the
full distribution payable on such Distribution Payment Date in respect of such
Class O Partnership Preferred Units called for redemption shall be payable on
such Distribution Payment Date to the holders of record of such Class O
Partnership Preferred Units on the applicable dividend record date
notwithstanding the prior redemption of such Class O Partnership Preferred
Units. No interest shall accrue for the benefit of the holders of Class O
Partnership Preferred Units to be redeemed on any cash set aside by the
Partnership.

         6. STATUS OF REACQUIRED UNITS.

         All Class O Partnership Preferred Units which shall have been issued
and reacquired in any manner by the Partnership shall be deemed cancelled.

         7. CONVERSION.

         Class O Partnership Preferred Units shall be convertible as follows:


                                       Z-4
   7


                  (a) Upon any conversion of shares of Class O Preferred Stock
into shares of Common Stock, the General Partner shall cause a number of Class O
Partnership Preferred Units equal to the number of such converted shares of
Class O Preferred Stock to be converted by the holders thereof into Partnership
Common Units. The conversion ratio in effect from time to time for the
conversion of Class O Partnership Preferred Units into Partnership Common Units
pursuant to this Section 7 shall at all times be equal to, and shall be
automatically adjusted as necessary to reflect, the conversion ratio in effect
from time to time for the conversion of Class O Preferred Stock into Common
Stock.

                  (b) In the event of a conversion of any Class O Partnership
Preferred Units, the Partnership shall make a cash payment to the holder thereof
equal to the cash payment required to be made by the Previous General Partner to
the holder of the shares of Class O Preferred Stock the conversion of which
required the conversion of such Class O Partnership Preferred Units. Holders of
Class O Partnership Preferred Units at the close of business on a distribution
payment record date shall be entitled to receive the distribution payable on
such units on the corresponding Distribution Payment Date notwithstanding the
conversion thereof following such distribution payment record date and prior to
such Distribution Payment Date. Except as provided above, the Partnership shall
make no payment or allowance for unpaid distributions on converted units or for
distributions on the Partnership Common Units issued upon such conversion. Each
conversion of Class O Partnership Preferred Units into Partnership Common Units
shall be deemed to have been effected at the same time and date that the
corresponding conversion of Class O Preferred Stock into Common Stock is deemed
to have been effected.

                  (c) No fractional Partnership Common Units shall be issued
upon conversion of Class O Partnership Preferred Units. Instead of any
fractional Partnership Common Units that would otherwise be deliverable upon the
conversion of Class O Partnership Preferred Units, the Partnership shall pay to
the holder of such converted units an amount in cash equal to the cash payable
to a holder of an equivalent number of converted shares of Class O Preferred
Stock in lieu of fractional shares of Common Stock.

                  (d) The Partnership will pay any and all documentary stamp or
similar issue or transfer taxes payable in respect of (i) the issue or delivery
of Partnership Common Units or other securities or property on conversion or
redemption of Class O Partnership Preferred Units pursuant hereto, and (ii) the
issue or delivery of Common Stock or other securities or property on conversion
or redemption of Class O Preferred Stock pursuant to the terms hereof.


                                       Z-5
   8


         8. RANKING.

         Any class or series of Partnership Units of the Partnership shall be
deemed to rank:

                  (a) prior or senior to the Class O Partnership Preferred
Units, as to the payment of distributions and as to distributions of assets upon
liquidation, dissolution or winding up, if the holders of such class or series
shall be entitled to the receipt of distributions and of amounts distributable
upon liquidation, dissolution or winding up, as the case may be, in preference
or priority to the holders of Class O Partnership Preferred Units ("Senior
Partnership Units");

                  (b) on a parity with the Class O Partnership Preferred Units,
as to the payment of distributions and as to distribution of assets upon
liquidation, dissolution or winding up, whether or not the distribution rates,
distribution payment dates or redemption or liquidation prices per unit or other
denomination thereof be different from those of the Class O Partnership
Preferred Units if (i) such class or series of Partnership Units shall be Class
B Partnership Preferred Units, Class C Partnership Preferred Units, Class D
Partnership Preferred Units, Class G Partnership Preferred Units, Class H
Partnership Preferred Units, Class I Partnership Preferred Units, Class J
Partnership Preferred Units, Class K Partnership Preferred Units, Class L
Partnership Preferred Units, Class M Partnership Preferred Units, Class N
Partnership Preferred Units, Class One Partnership Preferred Units, Class Two
Partnership Preferred Units, Class Three Partnership Preferred Units, Class Four
Partnership Preferred Units, or Class Six Partnership Preferred Units, or (ii)
the holders of such class or series of Partnership Units and the Class O
Partnership Preferred Units shall be entitled to the receipt of distributions
and of amounts distributable upon liquidation, dissolution or winding up in
proportion to their respective amounts of accrued and unpaid distributions per
unit or other denomination or liquidation preferences, without preference or
priority one over the other (the Partnership Units referred to in clauses (i)
and (ii) of this paragraph being hereinafter referred to, collectively, as
"Parity Partnership Units"); and

                  (c) junior to the Class O Partnership Preferred Units, as to
the payment of distributions and as to the distribution of assets upon
liquidation, dissolution or winding up, if (i) such class or series of
Partnership Units shall be Partnership Common Units, Class I High Performance
Partnership Units, or Class Five Partnership Preferred Units, or (ii) the
holders of Class O Partnership Preferred Units shall be entitled to receipt of
distributions or of amounts distributable upon liquidation, dissolution or
winding up, as the case may be, in preference or priority to the holders of such
class or series of Partnership Units (the Partnership Units referred to in
clauses (i)


                                       Z-6
   9


and (ii) of this paragraph being hereinafter referred to, collectively, as
"Junior Partnership Units").

         9. SPECIAL ALLOCATIONS.

                  (a) Gross income and, if necessary, gain shall be allocated to
the holders of Class O Partnership Preferred Units for any Fiscal Year (and, if
necessary, subsequent Fiscal Years) to the extent that the holders of Class O
Partnership Preferred Units receive a distribution on any Class O Partnership
Preferred Units (other than an amount included in any redemption pursuant to
Section 5 hereof) with respect to such Fiscal Year.

                  (b) If any Class O Partnership Preferred Units are redeemed
pursuant to Section 5 hereof, for the Fiscal Year that includes such redemption
(and, if necessary, for subsequent Fiscal Years) (a) gross income and gain (in
such relative proportions as the General Partner in its discretion shall
determine) shall be allocated to the holders of Class O Partnership Preferred
Units to the extent that the redemption amounts paid or payable with respect to
the Class O Partnership Preferred Units so redeemed exceeds the aggregate
Capital Contributions (net of liabilities assumed or taken subject to by the
Partnership) per Class O Partnership Preferred Unit allocable to the Class O
Partnership Preferred Units so redeemed and (b) deductions and losses (in such
relative proportions as the General Partner in its discretion shall determine)
shall be allocated to the holders of Class O Partnership Preferred Units to the
extent that the aggregate Capital Contributions (net of liabilities assumed or
taken subject to by the Partnership) per Class O Partnership Preferred Unit
allocable to the Class O Partnership Preferred Units so redeemed exceeds the
redemption amount paid or payable with respect to the Class O Partnership
Preferred Units so redeemed.

         10. RESTRICTIONS ON OWNERSHIP.

         The Class O Partnership Preferred Units shall be owned and held solely
by the General Partner or the Special Limited Partner.

         11. GENERAL.

                  (a) The ownership of Class O Partnership Preferred Units may
(but need not, in the sole and absolute discretion of the General Partner) be
evidenced by one or more certificates. The General Partner shall amend Exhibit A
to the Agreement from time to time to the extent necessary to reflect accurately
the issuance of, and subsequent


                                       Z-7
   10


conversion, redemption, or any other event having an effect on the ownership of,
Class O Partnership Preferred Units.

                  (b) The rights of the General Partner and the Special Limited
Partner, in their capacity as holders of the Class O Partnership Preferred
Units, are in addition to and not in limitation of any other rights or authority
of the General Partner or the Special Limited Partner, respectively, in any
other capacity under the Agreement or applicable law. In addition, nothing
contained herein shall be deemed to limit or otherwise restrict the authority of
the General Partner or the Special Limited Partner under the Agreement, other
than in their capacity as holders of the Class L Partnership Preferred Units.


                                       Z-8

EX-10.3

   1
                                                                    EXHIBIT 10.3

                        SIXTEENTH AMENDMENT TO THE THIRD
                        AMENDED AND RESTATED AGREEMENT OF
                  LIMITED PARTNERSHIP OF AIMCO PROPERTIES, L.P.

         This SIXTEENTH AMENDMENT TO THE THIRD AMENDED AND RESTATED AGREEMENT OF
LIMITED PARTNERSHIP OF AIMCO PROPER TIES, L.P., dated as of September 15, 2000
(this "Amendment"), is being executed by AIMCO-GP, Inc., a Delaware corporation
(the "General Partner"), as the general partner of AIMCO Properties, L.P., a
Delaware limited partnership (the "Partnership"), pursuant to the authority
conferred on the General Partner by the Third Amended and Restated Agreement of
Limited Partnership of AIMCO Properties, L.P., dated as of July 29, 1994, as
amended and/or supplemented from time to time (the "Agreement"). Capitalized
terms used, but not otherwise defined herein, shall have the respective meanings
ascribed thereto in the Agreement.

         NOW, THEREFORE, in consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

         1. Section 3 of the Partnership Unit Designation of the Class Three
Partnership Preferred Units of AIMCO Properties, L.P. (Exhibit U to the
Agreement) is hereby amended to read in its entirety as set forth below:

         3. RANKING.

                  Any class or series of Partnership Units of the Partnership
         shall be deemed to rank:

                  (a) prior or senior to the Class Three Partnership Preferred
         Units, as to the payment of distributions and as to the distribution of
         assets upon liquidation, dissolution or winding up, if the holders of
         such class or series shall be entitled to the receipt of distributions
         and of amounts distributable upon liquidation, dissolution or winding
         up, as the case may be, in preference or priority to the holders of
         Class Three Partnership Preferred Units (the Partnership Units referred
         to in this paragraph being hereinafter referred to, collectively, as
         "Senior Partner ship Units");

                  (b) on a parity with the Class Three Partnership Preferred
         Units, as to the payment of distributions and as to the distribution of
         assets upon liquidation, dissolution or winding up, whether or not the
         distribution rates, distribution payment dates or redemption or

   2

         liquidation prices per unit or other denomination thereof be different
         from those of the Class Three Partnership Preferred Units if (i) such
         class or series of Partnership Units shall be Class B Partnership
         Preferred Units, Class C Partnership Preferred Units, Class D
         Partnership Preferred Units, Class G Partnership Preferred Units, Class
         H Partnership Preferred Units, Class I Partnership Preferred Units,
         Class J Partnership Preferred Units, Class K Partnership Preferred
         Units, Class L Partnership Preferred Units, Class M Partnership
         Preferred Units, Class N Partnership Preferred Units, Class O
         Partnership Preferred Units, Class One Partnership Preferred Units,
         Class Two Partnership Preferred Units, Class Four Partnership Preferred
         Units or Class Six Partnership Preferred Units or (ii) the holders of
         such class or series of Partnership Units and the Class Three
         Partnership Preferred Units shall be entitled to the receipt of
         distributions and of amounts distributable upon liquidation,
         dissolution or winding up in proportion to their respective amounts of
         accrued and unpaid distributions per unit or other denomination or
         liquidation preferences, without preference or priority one over the
         other (the Partnership Units referred to in clauses (i) and (ii) of
         this paragraph being hereinafter referred to, collectively, as "Parity
         Partner ship Units"); and

                  (c) junior to the Class Three Partnership Preferred Units, as
         to the payment of distributions and as to the distribution of assets
         upon liquidation, dissolution or winding up, if (i) such class or
         series of Partnership Units shall be Partnership Common Units, Class I
         High Performance Partnership Units or Class Five Partnership Preferred
         Units or (ii) the holders of Class Three Partnership Preferred Units
         shall be entitled to receipt of distributions or of amounts
         distributable upon liquidation, dissolution or winding up, as the case
         may be, in preference or priority to the holders of such class or
         series of Partnership Units (the Partnership Units referred to in
         clauses (i) and (ii) of this paragraph being hereinafter referred to,
         collectively, as "Junior Partnership Units").

         2. The Partnership Unit Designation of the Class Five Partnership
Preferred Units of AIMCO Properties, L.P. (Exhibit V to the Agreement) is hereby
amended by adding to it a new Section 11, to read in its entirety as set forth
below:

         11. RANKING.

                  Any class or series of Partnership Units of the Partnership
         shall be deemed to rank:


                                       2
   3


                  (a) prior or senior to the Class Five Partnership Preferred
         Units, as to the payment of distributions and as to the distribution of
         assets upon liquidation, dissolution or winding up, if (i) the holders
         of such class or series shall be entitled to the receipt of
         distributions and of amounts distributable upon liquidation,
         dissolution or winding up, as the case may be, in preference or
         priority to the holders of Class Five Partnership Preferred Units or
         (ii) such class or series of Partnership Units shall be Class B
         Partnership Preferred Units, Class C Partnership Preferred Units, Class
         D Partnership Preferred Units, Class G Partner ship Preferred Units,
         Class H Partnership Preferred Units, Class I Partnership Preferred
         Units, Class J Partnership Preferred Units, Class K Partnership
         Preferred Units, Class L Partnership Preferred Units, Class M
         Partnership Preferred Units, Class N Partnership Preferred Units, Class
         O Partnership Preferred Units, Class One Partnership Preferred Units,
         Class Two Partnership Preferred Units, Class Three Partnership
         Preferred Units, Class Four Partnership Preferred Units or Class Six
         Partnership Preferred Units (the Partnership Units referred to in
         clauses (i) and (ii) of this paragraph being hereinafter referred to,
         collectively, as "Senior Partnership Units");

                  (b) on a parity with the Class Five Partnership Preferred
         Units, as to the payment of distributions and as to the distribution of
         assets upon liquidation, dissolution or winding up, whether or not the
         distribution rates, distribution payment dates or redemption or
         liquidation prices per unit or other denomination thereof be different
         from those of the Class Five Partnership Preferred Units if (i) such
         class or series of Partnership Units shall be Partnership Common Units
         or Class I High Performance Partnership Units or (ii) the holders of
         such class or series of Partnership Units and the Class Five
         Partnership Preferred Units shall be entitled to the receipt of
         distributions and of amounts distributable upon liquidation,
         dissolution or winding up in proportion to their respective amounts of
         accrued and unpaid distributions per unit or other denomination or
         liquidation preferences, without preference or priority one over the
         other (the Partnership Units referred to in clauses (i) and (ii) of
         this paragraph being hereinafter referred to, collectively, as "Parity
         Partnership Units"); and

                  (c) junior to the Class Five Partnership Preferred Units, as
         to the payment of distributions and as to the distribution of assets
         upon liquidation, dissolution or winding up, if the holders of Class
         Five Partnership Preferred Units shall be entitled to receipt of
         distributions or


                                         3
   4


         of amounts distributable upon liquidation, dissolution or winding up,
         as the case may be, in preference or priority to the holders of such
         class or series of Partnership Units (the Partnership Units referred to
         in this paragraph being hereinafter referred to, collectively, as
         "Junior Partner ship Units").

         3. Section 8 of the Partnership Unit designation of the Class M
Partnership Preferred Units of AIMCO Properties, L.P. (Exhibit W to the
Agreement) is hereby amended to read in its entirety as set forth below:

         8. RANKING.

                  Any class or series of Partnership Units of the Partnership
         shall be deemed to rank:

                  (a) prior or senior to the Class M Partnership Preferred
         Units, as to the payment of distributions and as to the distribution of
         assets upon liquidation, dissolution or winding up, if the holders of
         such class or series shall be entitled to the receipt of distributions
         and of amounts distributable upon liquidation, dissolution or winding
         up, as the case may be, in preference or priority to the holders of
         Class M Partnership Preferred Units (the Partnership Units referred to
         in this paragraph being hereinafter referred to, collectively, as
         "Senior Partnership Units");

                  (b) on a parity with the Class M Partnership Preferred Units,
         as to the payment of distributions and as to the distribution of assets
         upon liquidation, dissolution or winding up, whether or not the
         distribution rates, distribution payment dates or redemption or
         liquidation prices per unit or other denomination thereof be different
         from those of the Class M Partnership Preferred Units if (i) such class
         or series of Partnership Units shall be Class B Partnership Preferred
         Units, Class C Partnership Preferred Units, Class D Partnership
         Preferred Units, Class G Partnership Preferred Units, Class H
         Partnership Preferred Units, Class I Partnership Preferred Units, Class
         J Partnership Preferred Units, Class K Partnership Preferred Units,
         Class L Partnership Preferred Units, Class N Partnership Preferred
         Units, Class O Partnership Preferred Units, Class One Partnership
         Preferred Units, Class Two Partnership Preferred Units, Class Three
         Partnership Preferred Units, Class Four Partnership Preferred Units or
         Class Six Partnership Preferred Units or (ii) the holders of such class
         or series of Partnership Units and the Class M Partnership Preferred
         Units shall be entitled to the receipt of distributions and of amounts
         distributable upon


                                       4
   5


         liquidation, dissolution or winding up in proportion to their
         respective amounts of accrued and unpaid distributions per unit or
         other denomination or liquidation preferences, without preference or
         priority one over the other (the Partnership Units referred to in
         clauses (i) and (ii) of this paragraph being hereinafter referred to,
         collectively, as "Parity Partnership Units"); and

                  (c) junior to the Class M Partnership Preferred Units, as to
         the payment of distributions and as to the distribution of assets upon
         liquidation, dissolution or winding up, if (i) such class or series of
         Partnership Units shall be Partnership Common Units, Class I High
         Performance Partnership Units or Class Five Partnership Preferred Units
         or (ii) the holders of Class M Partnership Preferred Units shall be
         entitled to receipt of distributions or of amounts distributable upon
         liquidation, dissolution or winding up, as the case may be, in
         preference or priority to the holders of such class or series of
         Partnership Units (the Partnership Units referred to in clauses (i) and
         (ii) of this paragraph being hereinafter referred to, collectively, as
         "Junior Partnership Units").

         4. Section 3 of the Partnership Unit Designation of the Class Six
Partnership Preferred Units of AIMCO Properties, L.P. (Exhibit X to the
Agreement) is hereby amended to read in its entirety as set forth below:

         3. RANKING.

                  Any class or series of Partnership Units of the Partnership
         shall be deemed to rank:

                  (a) prior or senior to the Class Six Partnership Preferred
         Units, as to the payment of distributions and as to the distribution of
         assets upon liquidation, dissolution or winding up, if the holders of
         such class or series shall be entitled to the receipt of distributions
         and of amounts distributable upon liquidation, dissolution or winding
         up, as the case may be, in preference or priority to the holders of
         Class Six Partnership Preferred Units (the Partnership Units referred
         to in this paragraph being hereinafter referred to, collectively, as
         "Senior Partnership Units");

                  (b) on a parity with the Class Six Partnership Preferred
         Units, as to the payment of distributions and as to the distribution of
         assets upon liquidation, dissolution or winding up, whether or not the
         distribution rates, distribution payment dates or redemption or
         liquidation prices per unit or


                                       5
   6


         other denomination thereof be different from those of the Class Six
         Partnership Preferred Units if (i) such class or series of Partnership
         Units shall be Class B Partnership Preferred Units, Class C Partnership
         Preferred Units, Class D Partnership Preferred Units, Class G
         Partnership Preferred Units, Class H Partnership Preferred Units, Class
         I Partnership Preferred Units, Class J Partnership Preferred Units,
         Class K Partnership Preferred Units, Class L Partnership Preferred
         Units, Class M Partnership Preferred Units, Class N Partnership
         Preferred Units, Class O Partnership Preferred Units, Class One
         Partnership Preferred Units, Class Two Partnership Preferred Units,
         Class Three Partnership Preferred Units or Class Four Partnership
         Preferred Units or (ii) the holders of such class or series of
         Partnership Units and the Class Six Partnership Preferred Units shall
         be entitled to the receipt of distributions and of amounts
         distributable upon liquidation, dissolution or winding up in proportion
         to their respective amounts of accrued and unpaid distributions per
         unit or other denomination or liquidation preferences, without
         preference or priority one over the other (the Partnership Units
         referred to in clauses (i) and (ii) of this paragraph being hereinafter
         referred to, collectively, as "Parity Partnership Units"); and

                  (c) junior to the Class Six Partnership Preferred Units, as to
         the payment of distributions and as to the distribution of assets upon
         liquidation, dissolution or winding up, if (i) such class or series of
         Partnership Units shall be Partnership Common Units, Class I High
         Performance Partnership Units or Class Five Partnership Preferred Units
         or (ii) the holders of Class Six Partnership Preferred Units shall be
         entitled to receipt of distributions or of amounts distributable upon
         liquidation, dissolution or winding up, as the case may be, in
         preference or priority to the holders of such class or series of
         Partnership Units (the Partnership Units referred to in clauses (i) and
         (ii) of this paragraph being hereinafter referred to, collectively, as
         "Junior Partnership Units").

         5. Except as specifically amended hereby, the terms, covenants,
provisions and conditions of the Agreement shall remain unmodified and continue
in full force and effect and, except as amended hereby, all of the terms,
covenants, provisions and conditions of the Agreement are hereby ratified and
confirmed in all respects.


                                       6
   7


         IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.

                                            GENERAL PARTNER:

                                            AIMCO-GP, INC.


                                            By: /s/ PAUL MCAULIFFE
                                                ------------------------------
                                                Name: Paul McAuliffe
                                                Title: Chief Financial Officer

EX-10.4

   1
                                                                   EXHIBIT 10.4

                       SEVENTEENTH AMENDMENT TO THE THIRD
                        AMENDED AND RESTATED AGREEMENT OF
                  LIMITED PARTNERSHIP OF AIMCO PROPERTIES, L.P.

         THIS SEVENTEENTH AMENDMENT TO THE THIRD AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP OF AIMCO PROPER TIES, L.P., dated as of November 10, 2000
(this "Amendment"), is being executed by AIMCO-GP, Inc., a Delaware corporation
(the "General Partner"), as the general partner of AIMCO Properties, L.P., a
Delaware limited partnership (the "Partnership"), pursuant to the authority
conferred on the General Partner by Section 7.3.C(7) of the Third Amended and
Restated Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of
July 29, 1994 (the "Agreement"). Capitalized terms used, but not otherwise
defined herein, shall have the respective meanings ascribed thereto in the
Agreement.

         WHEREAS, on September 21, 2000, the Partnership entered into several
agreements with the Regency Windsor Companies, whereby the Partnership agreed to
offer Class Seven Partnership Preferred Units (the "Partnership Preferred
Units"), with the designations, preferences and other rights, terms and
provisions set forth herein to partners of certain limited partnerships
affiliated with the Regency Windsor Companies; and

         WHEREAS, pursuant to Section 4.2.A of the Agreement, the General
Partner is authorized to determine the designations, preferences and relative,
participating, optional or other special rights, powers and duties of such
Partnership Preferred Units.

         NOW, THEREFORE, in consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

         i.       The Agreement is hereby amended by the addition of a new
                  exhibit, entitled "Exhibit AA", in the form attached hereto,
                  which shall be attached to and made a part of the Agreement.

         ii.      Except as specifically amended hereby, the terms, covenants,
                  provisions and conditions of the Agreement shall remain
                  unmodified and continue

   2

                  in full force and effect and, except as amended hereby, all of
                  the terms, covenants, provisions and conditions of the
                  Agreement are hereby ratified and confirmed in all respects.


                                       2
   3

         IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.

                                            GENERAL PARTNER:

                                            AIMCO-GP, INC.



                                            By:  /s/ PETER K. KOMPANIEZ
                                                --------------------------------
                                                Name: Peter K. Kompaniez
                                                Title:  President and Vice
                                                        Chairman


                                       3
   4

                                  EXHIBIT "AA"

                          PARTNERSHIP UNIT DESIGNATION
                                     OF THE
                     CLASS SEVEN PARTNERSHIP PREFERRED UNITS
                                       OF
                             AIMCO PROPERTIES, L.P.


         1.       NUMBER OF UNITS AND DESIGNATION.

         A class of Partnership Preferred Units is hereby designated as "Class
Seven Partnership Preferred Units," and the number of Partnership Preferred
Units constituting such class shall be three million (3,000,000).

         2.       DEFINITIONS.

         Capitalized terms used and not otherwise defined herein shall have the
meanings assigned thereto in the Third Amended and Restated Agreement of Limited
Partnership of AIMCO Properties, L.P. as amended, supplemented or restated from
time to time (the "Agreement"), as modified by this Partnership Unit Designation
and the defined terms used herein. For purposes of this Partnership Unit
Designation, the following terms shall have the respective meanings ascribed
below:

         "Assignee" shall mean a Person to whom one or more Preferred Units have
been Transferred in a manner permitted under the Agreement, but who has not
become a Substituted Limited Partner, and who has the rights set forth in
Section 11.5 of the Agreement.

         "Cash Amount" shall mean, with respect to any Tendered Unit, cash in an
amount equal to the Liquidation Preference of such Tendered Unit.

         "Class Seven Partnership Preferred Unit" or "Preferred Unit" shall mean
a Partnership Preferred Unit with the designations, preferences and relative,
participating, optional or other special rights, powers and duties as are set
forth in this Partnership Unit Designation.

         "Cut-Off Date" shall mean the fifth (5th) Business Day after the
General Partner's receipt of a Notice of Redemption.

         "Declination" shall have the meaning set forth in Section 6(f) of this
Partnership Unit Designation.

         "Distribution Payment Date" shall have the meaning set forth of Section
4(b) of this Partnership Unit Designation.

   5

         "Distribution Rate" shall mean 9.5%, subject to adjustment as provided
in Section 4(a) of this Partnership Unit Designation.

         "Dividend Yield" shall mean, as of any calculation date and with
respect to any class or series of capital stock, the quotient obtained by
dividing (i) the aggregate dollar amount of dividends payable on one share of
such class or series of capital stock, in accordance with its terms, for the 12
month period ending on the dividend payment date immediately preceding such
calculation date, by (ii) the Market Value of one share of such stock as of such
calculation date.

         "Junior Partnership Units" shall have the meaning set forth in Section
3(c) of this Partnership Unit Designation.

         "Liquidation Preference" shall have the meaning set forth in Section
5(a) of this Partnership Unit Designation.

         "Majority in Interest of the Limited Partners" means Limited Partners
(other than (i) the Special Limited Partner and (ii) any Limited Partner fifty
percent (50%) or more of whose equity is owned, directly or indirectly, by the
(a) General Partner or (b) any REIT as to which the General Partner is a
"qualified REIT subsidiary" (within the meaning of Code Section 856(i)(2)))
holding more than fifty percent (50%) of the outstanding Partnership Common
Units, Class I High Performance Partnership Units, Class I Partnership Preferred
Units, Class One Partnership Preferred Units, Class Two Partnership Preferred
Units, Class Three Partnership Preferred Units, Class Four Partnership Preferred
Units, Class Five Partnership Preferred Units, Class Six Partnership Preferred
Units and Class Seven Partnership Preferred Units held by all Limited Partners
(other than (i) the Special Limited Partner and (ii) any Limited Partner fifty
percent (50%) or more of whose equity is owned, directly or indirectly, by (a)
the General Partner or (b) any REIT as to which the General Partner is a
"qualified REIT subsidiary" (within the meaning of Code Section 856(i)(2))).

         "Market Value" shall mean, as of any calculation date and with respect
to any share of stock, the average of the daily market prices for ten (10)
consecutive trading days immediately preceding the calculation date. The market
price for any such trading day shall be:

                  (i) if the shares are listed or admitted to trading on any
         securities exchange or The Nasdaq Stock Market's National Market
         System, the closing price, regular way, on such day, or if no such sale
         takes place on such day, the average of the closing bid and asked
         prices on such day, in either case as reported in the principal
         consolidated transaction reporting system,

                  (ii) if the shares are not listed or admitted to trading on
         any securities exchange or The Nasdaq Stock Market's National Market
         System, the last reported sale price on such day or, if no sale takes
         place on such day, the average of the closing bid and asked prices on
         such day, as reported by a reliable quotation source designated by the
         General Partner, or

                  (iii) if the shares are not listed or admitted to trading on
         any securities exchange or The Nasdaq Stock Market's National Market
         System and no such last reported sale price or closing bid and asked
         prices are available, the average of the reported high bid and low
         asked prices on such day, as reported by a reliable quotation source
         designated by the General Partner, or if there shall be no bid and
         asked prices on such day, the average of the high bid


                                      AA-2
   6

         and low asked prices, as so reported, on the most recent day (not more
         than ten (10) days prior to the date in question) for which prices have
         been so reported;

provided, however, that, if there are no bid and asked prices reported during
the ten (10) days prior to the date in question, the Market Value of the shares
shall be determined by the General Partner acting in good faith on the basis of
such quotations and other information as it considers, in its reasonable
judgment, appropriate; provided, further, that the General Partner is authorized
to adjust the market price for any trading day as may be necessary, in its
judgment, to reflect an event that occurs at any time after the commencement of
such ten day period that would unfairly distort the Market Value, including,
without limitation, a stock dividend, split, subdivision, reverse stock split,
or share combination.

         "Notice of Redemption" shall mean a Notice of Redemption in the form of
Annex I to this Partnership Unit Designation.

         "Parity Partnership Units" shall have the meaning set forth in Section
3(b) of this Partnership Unit Designation.

         "Partnership" shall mean AIMCO Properties, L.P., a Delaware limited
partnership.

         "Previous General Partner" shall mean Apartment Investment and
Management Company, a Maryland corporation.

         "Primary Offering Notice" shall have the meaning set forth in Section
6(h)(4) of this Partnership Unit Designation.

         "Public Offering Funding" shall have the meaning set forth in Section
6(f)(2) of this Partnership Unit Designation.

         "Qualifying Preferred Stock" shall mean any class or series of
non-convertible perpetual preferred stock that (i) has been issued by a
corporation that has elected to be taxed as a REIT, (ii) has a fixed rate of
distributions or dividends, (iii) has a fixed liquidation preference (and which
entitles the holder thereof to no payments other than the payment of
distributions at a fixed rate and the payment of a fixed liquidation
preference), (iv) is listed on the New York Stock Exchange, (v) cannot be
redeemed at the option of the issuer for the first five years after issuance of
such class or series of preferred stock and that, at the Reset Date (or, if
applicable, as of the date the calculation of the Weighted Average of Preferred
Stock Dividend Yields is being made for purposes hereof in respect of such Reset
Date) cannot be so redeemed and (vi) is issued by an issuer the unsecured debt
of which has an average rating from Moody's Investors Services, Inc., Standard &
Poors Rating Services or Duff & Phelps Credit Rating Co. in a category that is
one rating category below the average rating, as of such date, of the Previous
General Partner's unsecured debt.

         "Redemption" shall have the meaning set forth in Section 6(b) of this
Partnership Unit Designation.

         "Registrable Shares" shall have the meaning set forth in Section
6(f)(2) of this Partnership Unit Designation.


                                      AA-3
   7
         "REIT Shares Amount" shall mean, with respect to any Tendered Units, a
number of REIT Shares equal to the quotient obtained by dividing (i) the Cash
Amount for such Tendered Units, by (ii) the Market Value of a REIT Share as of
the fifth (5th) Business Day prior to the date of receipt by the General Partner
of a Notice of Redemption for such Tendered Units.

         "Reset Date" shall mean November 9, 2005 and every fifth anniversary of
such date that occurs thereafter.

         "Senior Partnership Units" shall have the meaning set forth in Section
3(a) of this Partnership Unit Designation.

         "Single Funding Notice" shall have the meaning set forth in Section
6(f)(3) of this Partnership Unit Designation.

         "Specified Redemption Date" shall mean, with respect to any Redemption,
the later of (a) the tenth (10th) Business Day after the receipt by the General
Partner of a Notice of Redemption or (b) in the case of a Declination followed
by a Public Offering Funding, the Business Day next following the date of the
closing of the Public Offering Funding; provided, however, that the Specified
Redemption Date, as well as the closing of a Redemption, or an acquisition of
Tendered Units by the Previous General Partner pursuant to Section 6 hereof, on
any Specified Redemption Date, may be deferred, in the General Partner's sole
and absolute discretion, for such time (but in any event not more than one
hundred fifty (150) days in the aggregate) as may reasonably be required to
effect, as applicable, (i) a Public Offering Funding or other necessary funding
arrangements, (ii) compliance with the Securities Act or other law (including,
but not limited to, (a) state "blue sky" or other securities laws and (b) the
expiration or termination of the applicable waiting period, if any, under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended) and (iii)
satisfaction or waiver of other commercially reasonable and customary closing
conditions and requirements for a transaction of such nature.

         "Tendering Party" shall have the meaning set forth in Section 6(b) of
this Partnership Unit Designation.

         "Tendered Units" shall have the meaning set forth in Section 6(b) of
this Partnership Unit Designation.

         "Weighted Average of Preferred Stock Dividend Yields" shall mean, as of
any date of calculation, the average of the Dividend Yields, as of such date, of
each Qualifying Preferred Stock (other than a Qualifying Preferred Stock issued
by the Previous General Partner) that has been outstanding during the entire
year immediately preceding the date of calculation. Each such class of
Qualifying Preferred Stock (except Qualifying Preferred Stock of the Previous
General Partner) shall be weighted for its total market value.

         3.       RANKING.

         Any class or series of Partnership Units of the Partnership shall be
deemed to rank:

         (a)      prior or senior to the Class Seven Partnership Preferred
                  Units, as to the payment of distributions and as to the
                  distribution of assets upon liquidation, dissolution or


                                      AA-4
   8

                  winding up, if the holders of such class or series shall be
                  entitled to the receipt of distributions and of amounts
                  distributable upon liquidation, dissolution or winding up, as
                  the case may be, in preference or priority to the holders of
                  Class Seven Partnership Preferred Units (the partnership units
                  being hereinafter referred to, collectively, as "Senior
                  Partnership Units");

         (b)      on a parity with the Class Seven Partnership Preferred Units,
                  as to the payment of distributions and as to the distribution
                  of assets upon liquidation, dissolution or winding up, whether
                  or not the distribution rates, distribution payment dates or
                  redemption or liquidation prices per unit or other
                  denomination thereof be different from those of the Class
                  Seven Partnership Preferred Units (i) if such class or series
                  of partnership units shall be Class B Partnership Preferred
                  Units, Class C Partnership Preferred Units, Class D
                  Partnership Preferred Units, Class G Partnership Preferred
                  Units, Class H Partnership Preferred Units, Class J
                  Partnership Preferred Units, Class K Partnership Preferred
                  Units, Class L Partnership Preferred Units, Class M
                  Partnership Preferred Units, Class N Partnership Preferred
                  Units, Class O Partnership Preferred Units, Class One
                  Partnership Preferred Units, Class Two Partnership Preferred
                  Units, Class Three Partnership Preferred Units, Class Four
                  Partnership Preferred Units or Class Six Partnership Preferred
                  Units or (ii) if the holders of such class or series of
                  partnership units and the Class Seven Partnership Preferred
                  Units shall be entitled to the receipt of distributions and of
                  amounts distributable upon liquidation, dissolution or winding
                  up in proportion to their respective amounts of accrued and
                  unpaid distributions per unit or other denomination or
                  liquidation preferences, without preference or priority one
                  over the other (the partnership units referred to in clauses
                  (i) and (ii) of this paragraph being hereinafter referred to,
                  collectively, as "Parity Partnership Units"); and

         (c)      junior to the Class Seven Partnership Preferred Units, as to
                  the payment of distributions and as to the distribution of
                  assets upon liquidation, dissolution or winding up, (i) if
                  such class or series of partnership units shall be Partnership
                  Common Units, Class I High Performance Partnership Units or
                  Class Five Partnership Preferred Units or (ii) if the holders
                  of Class Seven Partnership Preferred Units shall be entitled
                  to receipt of distributions or of amounts distributable upon
                  liquidation, dissolution or winding up, as the case may be, in
                  preference or priority to the holders of such class or series
                  of Partnership Units (the partnership units referred to in
                  clauses (i) and (ii) of this paragraph being hereinafter
                  referred to, collectively, as "Junior Partnership Units").

         4.       QUARTERLY CASH DISTRIBUTIONS.

         (a)      The "Quarterly Distribution Amount," as of any date, shall be
                  equal to (i) the Distribution Rate then in effect, multiplied
                  by (ii) $25, and divided by (iii) four. Holders of Preferred
                  Units will be entitled to receive, when and as declared by the
                  General Partner, quarterly cash distributions in an amount per
                  Preferred Unit equal to the Quarterly Distribution Amount in
                  effect as of the date such distribution is declared by the
                  General Partner, and no more. On each Reset Date, the
                  Distribution Rate thereafter in effect shall be adjusted by
                  the General Partner to equal the lesser


                                      AA-5
   9

                  of (i) the Distribution Rate in effect immediately prior to
                  such Reset Date or (ii) the Dividend Yield of the class of
                  Qualifying Preferred Stock most recently issued by the
                  Previous General Partner or, if there is no class of
                  Qualifying Preferred Stock of the Previous General Partner
                  outstanding as of any Reset Date, the Weighted Average of
                  Preferred Stock Dividend Yields, calculated as of the end of
                  the calendar quarter immediately preceding such Reset Date;
                  provided, further, that if for any reason there are no classes
                  of Qualifying Preferred Stock of the type described in the
                  definition of "Weighted Average of Preferred Stock Dividend
                  Yields" outstanding on any Reset Date and the reference to the
                  Weighted Average of Preferred Stock Dividend Yields would
                  otherwise be determinative of the calculation of the adjusted
                  Distribution Rate on such Reset Date, the adjusted
                  Distribution Rate for the succeeding five (5) year period
                  shall be the Distribution Rate in effect immediately prior to
                  such Reset Date. Upon any such adjustment of the Distribution
                  Rate, the General Partner shall send a notice describing such
                  adjustment to the holders of the Preferred Units at their
                  respective addresses, as set forth on Exhibit A to the
                  Agreement.

         (b)      Any such distributions will be cumulative from the date of
                  original issue, whether or not in any distribution period or
                  periods such distributions have been declared, and shall be
                  payable quarterly on February 15, May 15, August 15 and
                  November 15 of each year (or, if not a Business Day, the next
                  succeeding Business Day) (each a "Distribution Payment Date"),
                  commencing on the first such date occurring after the date of
                  original issue. If the Preferred Units are issued on any day
                  other than a Distribution Payment Date, the first distribution
                  payable on such Preferred Units will be prorated for the
                  portion of the quarterly period that such Preferred Units are
                  outstanding on the basis of twelve 30-day months and a 360-day
                  year. Distributions will be payable in arrears to holders of
                  record as they appear on the records of the Partnership at the
                  close of business on the February 1, May 1, August 1 or
                  November 1, as the case may be, immediately preceding each
                  Distribution Payment Date. If the Preferred Units are issued
                  other than on a record date for the payment of distributions
                  to the holders of Preferred Units, the Quarterly Distribution
                  Amount shall, for any quarter in which the Distribution Rate
                  changes on any Reset Date, be appropriately prorated based on
                  the portions of such quarter during which the different
                  Distribution Rates were in effect, on the basis of twelve
                  30-day months and a 360-day year. Holders of Preferred Units
                  will not be entitled to receive any distributions in excess of
                  cumulative distributions on the Preferred Units. No interest,
                  or sum of money in lieu of interest, shall be payable in
                  respect of any distribution payment or payments on the
                  Preferred Units that may be in arrears. Holders of any
                  Preferred Units that are issued after the date of original
                  issuance will be entitled to receive the same distributions as
                  holders of any Preferred Units issued on the date of original
                  issuance.

         (c)      When distributions are not paid in full upon the Preferred
                  Units or any Parity Partnership Units, or a sum sufficient for
                  such payment is not set apart, all distributions declared upon
                  the Preferred Units and any Parity Partnership Units shall be
                  declared ratably in proportion to the respective amounts of
                  distributions accumulated and unpaid on the Preferred Units
                  and accumulated and unpaid on such


                                      AA-6
   10

                  Parity Partnership Units. Except as set forth in the preceding
                  sentence, unless distributions on the Preferred Units equal to
                  the full amount of accumulated and unpaid distributions have
                  been or contemporaneously are declared and paid, or declared
                  and a sum sufficient for the payment thereof has been or
                  contemporaneously is set apart for such payment, for all past
                  distribution periods, no distributions shall be declared or
                  paid or set apart for payment by the Partnership with respect
                  to any Parity Partnership Units.

         (d)      Unless full cumulative distributions (including all
                  accumulated, accrued and unpaid distributions) on the
                  Preferred Units have been declared and paid, or declared and
                  set apart for payment, for all past distribution periods, no
                  distributions (other than distributions paid in Junior
                  Partnership Units or options, warrants or rights to subscribe
                  for or purchase Junior Partnership Units) may be declared or
                  paid or set apart for payment by the Partnership and no other
                  distribution of cash or other property may be declared or
                  made, directly or indirectly, by the Partnership with respect
                  to any Junior Partnership Units, nor shall any Junior
                  Partnership Units be redeemed, purchased or otherwise acquired
                  (except for a redemption, purchase or other acquisition of
                  Partnership Common Units made for purposes of an employee
                  incentive or benefit plan of the Partnership or any affiliate
                  thereof, including, without limitation, Previous General
                  Partner and its affiliates) for any consideration (or any
                  monies be paid to or made available for a sinking fund for the
                  redemption of any such Junior Partnership Units), directly or
                  indirectly, by the Partnership (except by conversion into or
                  exchange for Junior Partnership Units, or options, warrants or
                  rights to subscribe for or purchase Junior Partnership Units),
                  nor shall any other cash or other property be paid or
                  distributed to or for the benefit of holders of Junior
                  Partnership Units.

         (e)      Notwithstanding the foregoing provisions of this Section 4,
                  the Partnership shall not be prohibited from (i) declaring or
                  paying or setting apart for payment any distribution on any
                  Parity Partnership Units or (ii) redeeming, purchasing or
                  otherwise acquiring any Parity Partnership Units, in each
                  case, if such declaration, payment, redemption, purchase or
                  other acquisition is necessary to maintain the Previous
                  General Partner's qualification as a REIT.

         5.       LIQUIDATION PREFERENCE.

         (a)      Upon any voluntary or involuntary liquidation, dissolution or
                  winding up of the Partnership, before any allocation of income
                  or gain by the Partnership shall be made to or set apart for
                  the holders of any Junior Partnership Units, to the extent
                  possible, the holders of Preferred Units shall be entitled to
                  be allocated income and gain to the extent necessary to enable
                  them to receive a liquidation preference (the "Liquidation
                  Preference") per Preferred Unit equal to the sum of (i) $25
                  plus (ii) any accumulated, accrued and unpaid distributions
                  (whether or not earned or declared) to the date of final
                  distribution to such holders; but such holders will not be
                  entitled to any further payment or allocation. Until all
                  holders of the Preferred Units have been paid the Liquidation
                  Preference in full, no allocation of income or gain will be
                  made to any


                                      AA-7
   11

                  holder of Junior Partnership Units upon the liquidation,
                  dissolution or winding up of the Partnership.

         (b)      If, upon any voluntary or involuntary liquidation, dissolution
                  or winding up of the Partnership, the assets of the
                  Partnership, or proceeds thereof, distributable among the
                  holders of Preferred Units shall be insufficient to pay in
                  full the Liquidation Preference and liquidating payments on
                  any Parity Partnership Units, then following appropriate
                  allocations of Partnership income, gain, deduction and loss,
                  such assets, or the proceeds thereof, shall be distributed
                  among the holders of Preferred Units and any such Parity
                  Partnership Units ratably in the same proportion as the
                  respective amounts that would be payable on such Preferred
                  Units and any such Parity Partnership Units if all amounts
                  payable thereon were paid in full.

         (c)      A voluntary or involuntary liquidation, dissolution or winding
                  up of the Partnership will not include a consolidation or
                  merger of the Partnership with one or more partnerships,
                  corporations or other entities, or a sale or transfer of all
                  or substantially all of the Partnership's assets.

         (d)      Upon any voluntary or involuntary liquidation, dissolution or
                  winding up of the Partnership, after all allocations shall
                  have been made in full to the holders of Preferred Units and
                  any Parity Partnership Units to the extent necessary to enable
                  them to receive their respective liquidation preferences, any
                  Junior Partnership Units shall be entitled to receive any and
                  all assets remaining to be paid or distributed, and the
                  holders of the Preferred Units and any Parity Partnership
                  Units shall not be entitled to share therein.

         6.       REDEMPTION.

         (a)      Except as set forth in Section 6(l) hereof, the Preferred
                  Units may not be redeemed at the option of the Partnership,
                  and will not be required to be redeemed or repurchased by the
                  Partnership or the Previous General Partner except if a holder
                  of a Preferred Unit effects a Redemption, as provided for in
                  Section 6(b) hereof. The Partnership or the Previous General
                  Partner may purchase Preferred Units from time to time in the
                  open market, by tender or exchange offer, in privately
                  negotiated purchases or otherwise.

         (b)      On or after the first (1st) anniversary of becoming a holder
                  of Preferred Units, a Qualifying Party shall have the right
                  (subject to the terms and conditions set forth herein) to
                  require the Partnership to redeem all or a portion of the
                  Preferred Units held by such Qualifying Party (such Preferred
                  Units being hereafter "Tendered Units") in exchange (a
                  "Redemption") for REIT Shares issuable on, or the Cash Amount
                  payable on, the Specified Redemption Date, as determined by
                  the Partnership in its sole discretion. Any Redemption shall
                  be exercised pursuant to a Notice of Redemption delivered to
                  the General Partner by the Qualifying Party when exercising
                  the Redemption right (the "Tendering Party").


                                      AA-8
   12

         (c)      If the Partnership elects to redeem Tendered Units for REIT
                  Shares rather than cash, then the Partnership shall direct the
                  Previous General Partner to issue and deliver such REIT Shares
                  to the Tendering Party pursuant to the terms set forth in this
                  Section 6, in which case, (i) the Previous General Partner,
                  acting as a distinct legal entity, shall assume directly the
                  obligation with respect thereto and shall satisfy the
                  Tendering Party's exercise of its Redemption right, and (ii)
                  such transaction shall be treated, for Federal income tax
                  purposes, as a transfer by the Tendering Party of such
                  Tendered Units to the Previous General Partner in exchange for
                  REIT Shares. In making such election to cause the Previous
                  General Partner to acquire Tendered Units, the Partnership
                  shall act in a fair, equitable and reasonable manner that
                  neither prefers one group or class of Tendering Parties over
                  another nor discriminates against a group or class of
                  Tendering Parties. If the Partnership elects to redeem any
                  number of Tendered Units for REIT Shares, rather than cash, on
                  the Specified Redemption Date, the Tendering Party shall sell
                  such number of the Tendered Units to the Previous General
                  Partner in exchange for a number of REIT Shares equal to the
                  REIT Shares Amount for such number of the Tendered Units. The
                  Tendering Party shall submit (i) such information,
                  certification or affidavit as the Previous General Partner may
                  reasonably require in connection with the application of the
                  Ownership Limit and other restrictions and limitations of the
                  Charter to any such acquisition and (ii) such written
                  representations, investment letters, legal opinions or other
                  instruments necessary, in the Previous General Partner's view,
                  to effect compliance with the Securities Act. The REIT Shares
                  shall be delivered by the Previous General Partner as duly
                  authorized, validly issued, fully paid and accessible REIT
                  Shares, free of any pledge, lien, encumbrance or restriction,
                  other than the Ownership Limit and other restrictions provided
                  in the Charter, the Bylaws of the Previous General Partner,
                  the Securities Act and relevant state securities or "blue sky"
                  laws. Neither any Tendering Party whose Tendered Units are
                  acquired by the Previous General Partner pursuant to this
                  Section 6, any Partner, any Assignee nor any other interested
                  Person shall have any right to require or cause the Previous
                  General Partner or the General Partner to register, qualify or
                  list any REIT Shares owned or held by such Person, whether or
                  not such REIT Shares are issued pursuant to this Section 6,
                  with the SEC, with any state securities commissioner,
                  department or agency, under the Securities Act or the Exchange
                  Act or with any stock exchange; provided, however, that this
                  limitation shall not be in derogation of any registration or
                  similar rights granted pursuant to any other written agreement
                  between the Previous General Partner and any such Person.
                  Notwithstanding any delay in such delivery, the Tendering
                  Party shall be deemed the owner of such REIT Shares for all
                  purposes, including, without limitation, rights to vote or
                  consent, receive dividends, and exercise rights, as of the
                  Specified Redemption Date. REIT Shares issued upon an
                  acquisition of the Tendered Units by the Previous General
                  Partner pursuant to this Section 6 may contain such legends
                  regarding restrictions under the Securities Act and applicable
                  state securities laws as the Previous General Partner in good
                  faith determines to be necessary or advisable in order to
                  ensure compliance with such laws.

         (d)      The Partnership shall have no obligation to effect any
                  redemption unless and until a Tendering Party has given the
                  Partnership a Notice of Redemption. Each Notice of


                                      AA-9
   13

                  Redemption shall be sent by hand delivery or by first class
                  mail, postage prepaid, to AIMCO Properties, L.P., c/o
                  AIMCO-GP, Inc., Tower Two, 2000 South Colorado Boulevard,
                  Suites 2-1000, Denver, Colorado 80222, Attention: Investor
                  Relations, or to such other address as the Partnership shall
                  specify in writing by delivery to the holders of the Preferred
                  Units in the same manner as that set forth above for delivery
                  of the Notice of Redemption. At any time prior to the
                  Specified Redemption Date for any Redemption, any holder may
                  revoke its Notice of Redemption.

         (e)      A Tendering Party shall have no right to receive distributions
                  with respect to any Tendered Units (other than the Cash
                  Amount) paid after delivery of the Notice of Redemption,
                  whether or not the record date for such distribution precedes
                  or coincides with such delivery of the Notice of Redemption.
                  If the Partnership elects to redeem any number of Tendered
                  Units for cash, the Cash Amount for such number of Tendered
                  Units shall be delivered as a certified check payable to the
                  Tendering Party or, in the General Partner's sole and absolute
                  discretion, in immediately available funds.

         (f)      In the event that the Partnership declines to cause the
                  Previous General Partner to acquire all of the Tendered Units
                  from the Tendering Party in exchange for REIT Shares pursuant
                  to this Section 6 following receipt of a Notice of Redemption
                  (a "Declination"):

                           (1) The Previous General Partner or the General
Partner shall give notice of such Declination to the Tendering Party on or
before the close of business on the Cut-Off Date.

                           (2) The Partnership may elect to raise funds for the
payment of the Cash Amount either (a) by requiring that the Previous General
Partner contribute such funds from the proceeds of a registered public offering
(a "Public Offering Funding") by the Previous General Partner of a number of
REIT Shares ("Registrable Shares") equal to the REIT Shares Amount with respect
to the Tendered Units or (b) from any other sources (including, but not limited
to, the sale of any Property and the incurrence of additional Debt) available to
the Partnership.

                           (3) Promptly upon the General Partner's receipt of
the Notice of Redemption and the Previous General Partner or the General Partner
giving notice of the Partnership's Declination, the General Partner shall give
notice (a "Single Funding Notice") to all Qualifying Parties then holding
Preferred Units and having Redemption rights pursuant to this Section 6 and
require that all such Qualifying Parties elect whether or not to effect a
Redemption of their Preferred Units to be funded through such Public Offering
Funding. In the event that any such Qualifying Party elects to effect such a
Redemption, it shall give notice thereof and of the number of Preferred Units to
be made subject thereon in writing to the General Partner within ten (10)
Business Days after receipt of the Single Funding Notice, and such Qualifying
Party shall be treated as a Tendering Party for all purposes of this Section 6.
In the event that a Qualifying Party does not so elect, it shall be deemed to
have waived its right to effect a Redemption for the next twelve months;
provided, however, that the Previous General Partner shall not be required to
acquire Preferred Units pursuant to this Section 6(f) more than twice within any
twelve-month period.


                                      AA-10
   14

Any proceeds from a Public Offering Funding that are in excess of the Cash
Amount shall be for the sole benefit of the Previous General Partner and/or the
General Partner. The General Partner and/or the Special Limited Partner shall
make a Capital Contribution of such amounts to the Partnership for an additional
General Partner Interest and/or Limited Partner Interest. Any such contribution
shall entitle the General Partner and the Special Limited Partner, as the case
may be, to an equitable Percentage Interest adjustment.

         (g)      Notwithstanding the provisions of this Section 6, the Previous
                  General Partner shall not, under any circumstances, elect to
                  acquire Tendered Units in exchange for REIT Shares if such
                  exchange would be prohibited under the Charter.

         (h)      Notwithstanding anything herein to the contrary, with respect
                  to any Redemption pursuant to this Section 6:

                           (1) All Preferred Units acquired by the Previous
General Partner pursuant to this Section 6 hereof shall be contributed by the
Previous General Partner to either or both of the General Partner and the
Special Limited Partner in such proportions as the Previous General Partner, the
General Partner and the Special Limited Partner shall determine. Any Preferred
Units so contributed to the General Partner shall automatically, and without
further action required, be converted into and deemed to be a General Partner
Interest comprised of an equal number of Partnership Common Units. Any Preferred
Units so contributed to the Special Limited Partner shall be converted into
Partnership Common Units.

                           (2) Subject to the Ownership Limit, no Tendering
Party may effect a Redemption for less than five hundred (500) Preferred Units
or, if such Tendering Party holds (as a Limited Partner or, economically, as an
Assignee) less than five hundred (500) Preferred Units, all of the Preferred
Units held by such Tendering Party.

                           (3) No Tendering Party may (a) effect a Redemption
more than once in any fiscal quarter of a Twelve-Month Period or (b) effect a
Redemption during the period after the Partnership Record Date with respect to a
distribution and before the record date established by the Previous General
Partner for a distribution to its shareholders of some or all of its portion of
such Partnership distribution.

                           (4) Notwithstanding anything herein to the contrary,
with respect to any Redemption or acquisition of Tendered Units by the Previous
General Partner pursuant to this Section 6, in the event that the Previous
General Partner or the General Partner gives notice to all Limited Partners (but
excluding any Assignees) then owning Partnership Interests (a "Primary Offering
Notice") that the Previous General Partner desires to effect a primary offering
of its equity securities then, unless the Previous General Partner and the
General Partner otherwise consent, commencement of the actions denoted in
Section 6(f) hereof as to a Public Offering Funding with respect to any Notice
of Redemption thereafter received, whether or not the Tendering Party is a
Limited Partner, may be delayed until the earlier of (a) the completion of the
primary offering or (b) ninety (90) days following the giving of the Primary
Offering Notice.


                                      AA-11
   15

                           (5) Without the Consent of the Previous General
Partner, no Tendering Party may effect a Redemption within ninety (90) days
following the closing of any prior Public Offering Funding.

                           (6) The consummation of such Redemption shall be
subject to the expiration or termination of the applicable waiting period, if
any, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

                           (7) The Tendering Party shall continue to own
(subject, in the case of an Assignee, to the provision of Section 11.5 of the
Agreement) all Preferred Units subject to any Redemption, and be treated as a
Limited Partner or an Assignee, as applicable, with respect to such Preferred
Units for all purposes of the Agreement, until such Preferred Units are either
paid for by the Partnership pursuant to this Section 6 or transferred to the
Previous General Partner (or directly to the General Partner or Special Limited
Partner) and paid for, by the issuance of the REIT Shares, pursuant to this
Section 6 on the Specified Redemption Date. Until a Specified Redemption Date
and an acquisition of the Tendered Units by the Previous General Partner
pursuant to this Section 6, the Tendering Party shall have no rights as a
shareholder of the Previous General Partner with respect to the REIT Shares
issuable in connection with such acquisition.

For purposes of determining compliance with the restrictions set forth in this
Section 6(h), all Partnership Common Units and Partnership Preferred Units,
including Preferred Units, beneficially owned by a Related Party of a Tendering
Party shall be considered to be owned or held by such Tendering Party.

         (i)      In connection with an exercise of Redemption rights pursuant
                  to this Section 6, the Tendering Party shall submit the
                  following to the General Partner, in addition to the Notice of
                  Redemption:

                           (1) A written affidavit, dated the same date as the
Notice of Redemption, (a) disclosing the actual and constructive ownership, as
determined for purposes of Code Sections 856(a)(6) and 856(h), of REIT Shares
and any other classes or shares of the Previous General Partner by (i) such
Tendering Party and (ii) any Related Party and (b) representing that, after
giving effect to the Redemption, neither the Tendering Party nor any Related
Party will own REIT Shares in excess of the Ownership Limit;

                           (2) A written representation that neither the
Tendering Party nor any Related Party has any intention to acquire any
additional REIT Shares or any other class of shares of the Previous General
Partner prior to the closing of the Redemption on the Specified Redemption Date;
and

                           (3) An undertaking to certify, at and as a condition
to the closing of the Redemption on the Specified Redemption Date, that either
(a) the actual and constructive ownership of REIT Shares or any other class of
shares of the Previous General Partner by the Tendering Party and any Related
Party remain unchanged from that disclosed in the affidavit required by Section
6(i)(1) or (b) after giving effect to the Redemption, neither the Tendering
Party nor any Related Party shall own REIT Shares or other shares of the
Previous General Partner in violation of the Ownership Limit.


                                      AA-12
   16

         (j)      On or after the Specific Redemption Date, each holder of
                  Preferred Units shall surrender to the Partnership the
                  certificate evidencing such holder's Preferred Units, at the
                  address to which a Notice of Redemption is required to be
                  sent. Upon such surrender of a certificate, the Partnership
                  shall thereupon pay the former holder thereof the applicable
                  Cash Amount and/or deliver REIT Shares for the Preferred Units
                  evidenced thereby. From and after the Specific Redemption Date
                  (i) distributions with respect to the Preferred Units shall
                  cease to accumulate, (ii) the Preferred Units shall no longer
                  be deemed outstanding, (iii) the holders thereof shall cease
                  to be Partners to the extent of their interest in such
                  Preferred Units, and (iv) all rights whatsoever with respect
                  to the Preferred Units shall terminate, except the right of
                  the holders of the Preferred Units to receive Cash Amount
                  and/or REIT Shares therefor, without interest or any sum of
                  money in lieu of interest thereon, upon surrender of their
                  certificates therefor.

         (k)      Notwithstanding the provisions of this Section 6, the
                  Tendering Parties (i) shall not be entitled to elect or effect
                  a Redemption where the Redemption would consist of less than
                  all the Preferred Units held by Partners and, to the extent
                  that the aggregate Percentage Interests of the Limited
                  Partners would be reduced, as a result of the Redemption, to
                  less than one percent (1%) and (ii) shall have no rights under
                  the Agreement that would otherwise be prohibited under the
                  Charter. To the extent that any attempted Redemption would be
                  in violation of this Section 6(k), it shall be null and void
                  ab initio, and the Tendering Party shall not acquire any
                  rights or economic interests in REIT Shares otherwise issuable
                  by the Previous General Partner hereunder.

         (l)      Notwithstanding any other provision of the Agreement, on and
                  after the date on which the aggregate Percentage Interests of
                  the Limited Partners (other than the Special Limited Partner)
                  are less than one percent (1%), the Partnership shall have the
                  right, but not the obligation, from time to time and at any
                  time to redeem any and all outstanding Limited Partner
                  Interests (other than the Special Limited Partner's Limited
                  Partner Interest) by treating any Limited Partner as a
                  Tendering Party who has delivered a Notice of Redemption
                  pursuant to this Section 6 for the amount of Preferred Units
                  to be specified by the General Partner, in its sole and
                  absolute discretion, by notice to such Limited Partner that
                  the Partnership has elected to exercise its rights under this
                  Section 6(l). Such notice given by the General Partner to a
                  Limited Partner pursuant to this Section 6(l) shall be treated
                  as if it were a Notice of Redemption delivered to the General
                  Partner by such Limited Partner. For purposes of this Section
                  6(l), (a) any Limited Partner (whether or not eligible to be a
                  Tendering Party) may, in the General Partner's sole and
                  absolute discretion, be treated as a Tendering Party and (b)
                  the provisions of Sections 6(f)(1), 6(h)(2), 6(h)(3) and
                  6(h)(5) hereof shall not apply, but the remainder of this
                  Section shall apply, mutatis mutandis.

         7.       STATUS OF REACQUIRED UNITS.

         All Preferred Units which shall have been issued and reacquired in any
manner by the Partnership shall be deemed cancelled and no longer outstanding.


                                      AA-12
   17

         8.       GENERAL.

         The ownership of the Preferred Units shall be evidenced by one or more
certificates in the form of Annex II hereto. The General Partner shall amend
Exhibit A to the Agreement from time to time to the extent necessary to reflect
accurately the issuance of, and subsequent redemption, or any other event having
an effect on the ownership of, the Class Seven Partnership Preferred Units.

         9.       ALLOCATIONS OF INCOME AND LOSS.

         Subject to the terms of Section 5 hereof, for each taxable year, (i)
each holder of Preferred Units will be allocated, to the extent possible, net
income of the Partnership in an amount equal to the distributions made on such
holder's Preferred Units during such taxable year, and (ii) each holder of
Preferred Units will be allocated its pro rata share, based on the portion of
outstanding Preferred Units held by it, of any net loss of the Partnership that
is not allocated to holders of Partnership Common Units or other interests in
the Partnership.

         10.      VOTING RIGHTS.

         Except as otherwise required by applicable law or in the Agreement, the
holders of the Preferred Units will have the same voting rights as holders of
the Partnership Common Units. So long as any Preferred Units are outstanding,
for purposes of determining the Consent of Limited Partners under the Agreement,
the "Majority in Interest of the Limited Partners" shall have the meaning set
forth in Section 2 hereof. As long as my Preferred Units are outstanding, in
addition to any other vote or consent of partners required by law or by the
Agreement, the affirmative vote or consent of holders of at least 50% of the
outstanding Preferred Units will be necessary for effecting any amendment of any
of the provisions of the Partnership Unit Designation of the Preferred Units
that materially and adversely affects the rights or preferences of the holders
of the Preferred Units. The creation or issuance of any class or series of
Partnership units, including, without limitation, any Partnership units that may
have rights junior to, on a parity with, or senior or superior to the Preferred
Units, will not be deemed to have a material adverse effect on the rights or
preferences of the holders of Preferred Units. With respect to the exercise of
the above described voting rights, each Preferred Unit will have one (1) vote
per Preferred Unit.

         11.      RESTRICTIONS ON TRANSFER.

         Preferred Units are subject to the same restrictions on transfer as
are, and the holders of Preferred Units shall be entitled to the same rights of
transfer as are, applicable to Common Units as set forth in the Agreement.


                                      AA-13
   18

                                                                         ANNEX I
                                                                   TO EXHIBIT AA


                              NOTICE OF REDEMPTION


To:      AIMCO Properties, L.P.
         c/o AIMCO-GP, Inc.
         Tower Two
         2000 South Colorado Boulevard, Suite 2-1000
         Denver, Colorado 80222
         Attention:  Investor Relations

                  The undersigned Limited Partner or Assignee hereby irrevocably
tenders for redemption Class Seven Partnership Preferred Units in AIMCO
Properties, L.P. in accordance with the terms of the Third Amended and Restated
Agreement of Limited Partnership of AIMCO Properties, L.P., dated as of July 29,
1994, as it may be amended and supplemented from time to time (the "Agreement").
All capitalized terms used herein and not otherwise defined shall have the
respective meanings ascribed thereto in the Partnership Unit Designation of the
Class Seven Partnership Preferred Units. The undersigned Limited Partner or
Assignee:

                  (a) if the Partnership elects to redeem such Class Seven
         Partnership Preferred Units for REIT Shares rather than cash, hereby
         irrevocably transfers, assigns, contributes and sets over to Previous
         General Partner all of the undersigned Limited Partner's or Assignee's
         right, title and interest in and to such Class Seven Partnership
         Preferred Units;

                  (b) undertakes (i) to surrender such Class Seven Partnership
         Preferred Units and any certificate therefor at the closing of the
         Redemption contemplated hereby and (ii) to furnish to Previous General
         Partner, prior to the Specified Redemption Date:

                           (1) A written affidavit, dated the same date as this
                  Notice of Redemption, (a) disclosing the actual and
                  constructive ownership, as determined for purposes of Code
                  Sections 856(a)(6) and 856(h), of REIT Shares by (i) the
                  undersigned Limited Partner or Assignee and (ii) any Related
                  Party and (b) representing that, after giving effect to the
                  Redemption, neither the undersigned Limited Partner or
                  Assignee nor any Related Party will own REIT Shares in excess
                  of the Ownership Limit;

                           (2) A written representation that neither the
                  undersigned Limited Partner or Assignee nor any Related Party
                  has any intention to acquire any additional REIT Shares prior
                  to the closing of the Redemption contemplated hereby on the
                  Specified Redemption Date; and

                           (3) An undertaking to certify, at and as a condition
                  to the closing of the Redemption contemplated hereby on the
                  Specified Redemption Date, that either (a) the actual and
                  constructive ownership of REIT Shares


                                      AA-15
   19
                  by the undersigned Limited Partner or Assignee and any Related
                  Party remain unchanged from that disclosed in the affidavit
                  required by paragraph (1) above, or (b) after giving effect to
                  the Redemption contemplated hereby, neither the undersigned
                  Limited Partner or Assignee nor any Related Party shall own
                  REIT Shares in violation of the Ownership Limit.

                  (c) directs that the certificate representing the REIT Shares,
         or the certified check representing the Cash Amount, in either case,
         deliverable upon the closing of the Redemption contemplated hereby be
         delivered to the address specified below;

                  (d) represents, warrants, certifies and agrees that:

                           (i) the undersigned Limited Partner or Assignee has,
                  and at the closing of the Redemption will have, good,
                  marketable and unencumbered title to such Preferred Units,
                  free and clear of the rights or interests of any other person
                  or entity;

                           (ii) the undersigned Limited Partner or Assignee has,
                  and at the closing of the Redemption will have, the full
                  right, power and authority to tender and surrender such
                  Preferred Units as provided herein; and

                           (iii) the undersigned Limited Partner or Assignee has
                  obtained the consent or approval of all persons and entities,
                  if any, having the right to consent to or approve such tender
                  and surrender.

Dated:
        ---------------------


                                    Name of Limited Partner or Assignee:

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

                                    ------------------------------------------
                                    (Signature of Limited Partner or Assignee)

                                    ------------------------------------------
                                    (Street Address)

                                    ------------------------------------------
(continued on the next page)        (City)           (State)        (Zip Code)


                                      AA-16
   20


Issue check payable to
or Certificates in the
name of:
                                     ------------------------------------------

Please insert social security
or identifying number:
                                     ------------------------------------------


                                     Signature Guaranteed by:


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

NOTICE: THE SIGNATURE OF THIS NOTICE OF REDEMPTION MUST CORRESPOND WITH THE
NAME(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE FOR THE CLASS SEVEN
PREFERRED UNITS WHICH ARE BEING REDEEMED IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.

THE SIGNATURE SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION,
(Banks, Stockbrokers, Savings and Loan Associations and Credit Unions), WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM PURSUANT TO SEC
RULE 17Ad-15.


                                      AA-17
   21

                                                                        ANNEX II
                                                                   TO EXHIBIT AA

                            FORM OF UNIT CERTIFICATE
                                       OF
                     CLASS SEVEN PARTNERSHIP PREFERRED UNITS

THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT
BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS THE TRANSFEROR DELIVERS TO THE PARTNERSHIP AN OPINION OF
COUNSEL SATISFACTORY TO THE PARTNERSHIP, IN FORM AND SUBSTANCE SATISFACTORY TO
THE PARTNERSHIP, TO THE EFFECT THAT THE PROPOSED SALE, TRANSFER OR OTHER
DISPOSITION MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE ACT AND UNDER
APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS. IN ADDITION, THE LIMITED
PARTNERSHIP INTEREST EVIDENCED BY THIS CERTIFICATE MAY BE SOLD OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFER SET FORTH IN
THE THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF AIMCO
PROPERTIES, L.P., DATED AS OF JULY 29, 1994, AS IT MAY BE AMENDED AND/OR
SUPPLEMENTED FROM TIME TO TIME, A COPY OF WHICH MAY BE OBTAINED FROM AIMCO-GP,
INC, THE GENERAL PARTNER, AT ITS PRINCIPAL EXECUTIVE OFFICE.

                                                     Certificate Number ________

                             AIMCO PROPERTIES, L.P.
                 FORMED UNDER THE LAWS OF THE STATE OF DELAWARE

This certifies that
                    ------------------------------------------------------------

is the owner of
                ----------------------------------------------------------------

                     CLASS SEVEN PARTNERSHIP PREFERRED UNITS
                                       OF
                             AIMCO PROPERTIES, L.P.,

transferable on the books of the Partnership in person or by duly authorized
attorney on the surrender of this Certificate properly endorsed. This
Certificate and the Class Seven Partnership Preferred Units represented hereby
are issued and shall be held subject to all of the provisions of the Agreement
of Limited Partnership of AIMCO Properties, L.P., as the same may be amended
and/or supplemented from time to time.

IN WITNESS WHEREOF, the undersigned has signed this Certificate.

Dated:                                      By
                                               --------------------------------



                                      AA-18
   22


                                   ASSIGNMENT




         For Value Received, ___________________________ hereby sells, assigns
and transfers unto ______________________ Class Seven Partnership Preferred
Unit(s) represented by the within Certificate, and does hereby irrevocably
constitute and appoint the General Partner of AIMCO Properties, L.P. as its
Attorney to transfer said Class Seven Partnership Preferred Unit(s) on the books
of AIMCO Properties, L.P. with full power of substitution in the premises.


Dated:
       -----------------------
                                             By:
                                                 ------------------------------
                                                 Name:


                                             Signature Guaranteed by:


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


NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(S) AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.

THE SIGNATURE SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION,
(Banks, Stockbrokers, Savings and Loan Associations and Credit Unions), WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM PURSUANT TO SEC
RULE 17Ad-15.


                                     AA-19

EX-27.1

 

<ARTICLE> 5
<MULTIPLIER> 1,000

                             
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-2000
<PERIOD-START>                             JAN-01-2000
<PERIOD-END>                               SEP-30-2000
<CASH>                                         220,089
<SECURITIES>                                         0
<RECEIVABLES>                                        0
<ALLOWANCES>                                         0
<INVENTORY>                                          0
<CURRENT-ASSETS>                                     0
<PP&E>                                       6,121,674
<DEPRECIATION>                                 649,805
<TOTAL-ASSETS>                               7,156,084
<CURRENT-LIABILITIES>                                0
<BONDS>                                      3,825,203
<PREFERRED-MANDATORY>                           35,330
<PREFERRED>                                    934,474
<COMMON>                                             0
<OTHER-SE>                                   1,890,266
<TOTAL-LIABILITY-AND-EQUITY>                 7,156,084
<SALES>                                        790,328
<TOTAL-REVENUES>                               837,680
<CGS>                                          558,879
<TOTAL-COSTS>                                  763,915
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                             190,459
<INCOME-PRETAX>                                 60,837
<INCOME-TAX>                                         0
<INCOME-CONTINUING>                             60,837
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    60,837
<EPS-BASIC>                                        .35
<EPS-DILUTED>                                      .34


 

EX-99.1

   1
                                                                    EXHIBIT 99.1

          Agreement Regarding Disclosure of Long-Term Debt Instruments


          In reliance upon Item 601(b)(4)(iii)(A), of Regulation S-K, AIMCO
Properties, L.P., a Delaware limited partnership (the "Partnership") has not
filed as an exhibit to its Quarterly Report on Form 10-Q for the quarterly
period ending September 30, 2000, any instrument with respect to long-term debt
not being registered where the total amount of securities authorized thereunder
does not exceed 10 percent of the total assets of the Partnership and its
subsidiaries on a consolidated basis. Pursuant to Item 601(b)(4)(iii)(A), of
Regulation S-K, the Partnership hereby agrees to furnish a copy of any such
agreement to the Securities Exchange Commission upon request.

                                        AIMCO PROPERTIES, L.P.

                                        By: AIMCO-GP, Inc.
                                            its General Partner


                                        By: /s/ PETER KOMPANIEZ
                                            -------------------
                                            Peter Kompaniez
                                            President