<PAGE>

                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                  FORM 10-K

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

                                               Commission File
For the year ended December 31, 1996           Number  0-13500
                   -----------------                   ------- 

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP
        -------------------------------------------------------------   
           (exact name  of Registrant as specified in its charter)

       Massachusetts                                   04-2808184
---------------------------               -------------------------------------
  (State of organization)                   (IRS Employer Identification No.)

One International Place, Boston, Massachusetts                       02110
----------------------------------------------                     -----------
   (Address of principal executive offices)                        (Zip  Code) 

Registrant's telephone number including area code: (617) 330-8600 
                                                   --------------

Securities registered pursuant to Section 12(b) of the Act: None 
                                                            ----

Securities registered pursuant to Section 12(g) of the Act:  


                    Units of Limited Partnership Interest
                    -------------------------------------
                               (Title of Class)

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        
                                                  -------     ------
 
Indicate by check mark if disclosure of delinquent filers pursuant  to Item 405
of Regulation S-K is not contained herein, and will  not be contained, to the
best of registrant's knowledge, in  definitive proxy or information statements
incorporated by  reference in Part III of this Form 10-K or any amendment to
this  Form 10-K.  [   ] 

                                             (Cover Page Continued on next page)


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Cover Page 2 of 2

No market exists for the limited partnership interests of the  registrant, and,
therefore, no aggregate market value can be  computed.


                     Exhibit Index is located on Page ___

                     DOCUMENTS INCORPORATED BY REFERENCE

                                   - None -

                                      2

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                                       PART I
                                       ------

Item 1.  Business.
         --------

Organization
------------

     1626 New York Associates Limited Partnership (the  "Partnership") was
organized as a Massachusetts limited  partnership under the Massachusetts
Uniform Limited Partnership  Act on December 6, 1983, for the purpose of owning
a general  partnership interest in, and serving as a general partner of, 
Nineteen New York Properties Limited Partnership (the "Operating  Partnership"),
a Massachusetts limited partnership.  The  Operating Partnership was organized
on December 6, 1983 for the  purpose of acquiring a diversified portfolio of
nineteen  commercial properties (the "Properties") located in New York  City,
from the John D. and Catherine T. MacArthur Foundation.  

     The general partners of the Partnership (collectively, the  "General
Partners") are Two Winthrop Properties, Inc., a  Massachusetts corporation ("Two
Winthrop"), Winthrop Interim  Partners I, A Limited Partnership, a Maryland
limited partnership  ("WIPI") and Linnaeus-Lexington Associates Limited
Partnership, a  Massachusetts limited partnership ("Linnaeus-Lexington").  Two 
Winthrop is a wholly-owned subsidiary of First Winthrop  Corporation ("First
Winthrop"), a Delaware corporation which in  turn is wholly-owned by Winthrop
Financial Associates, A Limited  Partnership ("WFA"), a Maryland limited
partnership.  The general  partners of WIPI are Two Winthrop and
Linnaeus-Phoenix Associates  Limited Partnership, a Massachusetts limited
partnership  ("Linnaeus-Phoenix").  See "Change in Control".

     The Partnership was initially capitalized with contributions  totaling
$2,500,019 from the General Partners.  On October 13,  1984, the Partnership
completed a private placement of 1,344  units of limited partnership interest
(the "Units") at an  aggregate purchase price of $336,000,000 pursuant to
Regulation D  under the Securities Act of 1933.  

Description of Business
-----------------------

     The business of the Partnership is investing as a general  partner in the
Operating Partnership.  The other general partner  of the Operating Partnership
is First Winthrop.  The limited  partners of the Operating Partnership are WFA
and WFC Realty Co., 

                                      3
<PAGE>

Inc. ("WFC"), a Massachusetts corporation which is a wholly-owned  subsidiary of
First Winthrop.  

The Properties

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

     In January 1984, the Operating Partnership acquired the  Properties
consisting of:  (1) seventeen commercial office  buildings and the land
underlying such buildings located at 757  Third Avenue (the land was acquired in
May 1984), 410 Park  Avenue, 535 Fifth Avenue, 545 Fifth Avenue, 61 Broadway,
1372  Broadway, 366 Madison Avenue, 1697 Broadway, 509 Fifth Avenue,  300 Park
Avenue South, 227 East 45th Street, 134 West 29th  Street, 218-220 Fifth Avenue,
31-33-39 West 34th Street, 271  Church Street, 136-20 Roosevelt Avenue and 345
Adams Street; (2)  the 15 Columbus Circle building and a leasehold interest in
the  ground underlying such building; and (3) the ground underlying  another
office building located at 450 Park Avenue.  

     The Operating Partnership financed the acquisition of the  Properties
primarily through (a) the $336,000,000 raised from  Limited Partners of the
Partnership, (b) the assumption of  existing mortgage loans, and (c) the
placement of the  $330,000,000 loan from General Electric Pension Trust
("GEPT"),  which has been refinanced.

     As of December 31, 1996, the remaining Properties in which  the Operating
Partnership owned an interest consisted of six  commercial buildings and the
land underlying them, including 757  Third Avenue, 535 Fifth Avenue, 545 Fifth
Avenue, 1372 Broadway,  509 Fifth Avenue and 300 Park Avenue South.  From 1984
through  1992, the Operating Partnership sold seven of its properties and 
exchanged two other properties for the land underlying The 15  Columbus Circle
Building, which land and building were  subsequently transferred to GEPT
pursuant to a consensual  bankruptcy plan in full satisfaction of the loan
encumbering the  property.  The Operating Partnership sold one additional
property  in 1993 and conveyed its 227 East 45th Street property to a  designee
of the lender by a deed in lieu of foreclosure in the  first quarter of 1996. 
The Operating Partnership currently is  negotiating for the sale of 1372
Broadway.  See "Property  Matters"


                                      4
<PAGE>

Property Matters
----------------

      A. Sales/Dispositions
         ------------------

     227 East 45th Street - During 1995, the Partnership  concluded that the
debt securing the property was substantially  greater than the value of the
property.  As a result, on January  15, 1996 the Partnership and Sanwa Business
Credit Corporation  ("Sanwa"), the lender holding the mortgage on the property, 
agreed that in exchange for the delivery by the Partnership of a  deed in lieu
of foreclosure to a designee of Sanwa, Sanwa would  release the Partnership from
any liabilities or obligations  associated with the mortgage loan on 227 East
45th Street and  would release its second mortgage on the 509 Fifth Avenue 
property for no additional consideration.  The Operating  Partnership
transferred title to the property to Sanwa on January  24, 1996. As required by
the terms of the January 15 agreement,  Sanwa released the Operating

Partnership, as of the closing date,  from all claims, demands, liabilities,
obligations, actions and  causes of any kind with regard to the Sanwa loan,
other than the  second mortgage on 509 Fifth Avenue, which second mortgage was 
subsequently released.  See "Item 8, Consolidated Financial  Statements and
Supplementary Data, Note-5."

      B. Loan Restructuring.
         ------------------
 
     The Fuji Loan - 535 Fifth Avenue, 545 Fifth Avenue, 1372  Broadway and 757
Third Avenue.  Over the course of time, it  became apparent to the Operating
Partnership and The Fuji Bank,  Ltd. ("Fuji"), the holder of the mortgage debt
encumbering 535  and 545 Fifth Avenue, 1372 Broadway and 757 Third Avenue (the 
"Fuji Properties"), that the reserves established to fund  improvements and
operating deficits under the restructured Fuji  loan would be exhausted, and the
Fuji loan would go into default,  as early as 1996.  Early in 1995, the
Operating Partnership began  marketing for sale of 535-545 Fifth Avenue.  A sale
at the price  established by the General Partners would have accomplished, 
among other goals, a reduction in the loan balance, a reduction  in the monthly
drain on reserves and delay a default on the  remaining loan balance until 
1997. In April 1995, Fuji noted in  a letter to the Partnership its belief 
that the reserves would be  depleted in early 1996.  Over the following months,
the Operating  Partnership continued to market 535-545 Fifth Avenue and also
began pursuing discussions with Fuji aimed at restructuring the  debt to 
continue to preserve the Partnership's interest in the 

                                      5
<PAGE>

remaining Fuji Properties.  By September of 1995, the Operating  Partnership had
not received interest at a price sufficient to  conclude a sale of the property
and terminated its marketing  efforts on 535-545 Fifth Avenue.  At this point,
the Operating  Partnership also evaluated a bankruptcy strategy; however, 
restrictions in the applicable loan documents gave the Operating  Partnership's
lenders effective control over substantially all of  the Operating Partnership's
cash and cash flow, so that neither  the Operating Partnership nor the
Partnership had sufficient  reserves to fund a bankruptcy reorganization.

     Based on its belief of an impending default on the Fuji  loan, Fuji began
formally soliciting third-party offers for the  loan in late September 1995. 
Fuji's decision to sell the loan  effectively put an end to further discussions
with Fuji regarding  a restructuring of the loan.  At that time, the loan had a 
principal balance of approximately $207 million, plus accrued  interest of
approximately $40 million.  The Fuji loan accrued  interest at fixed annual
interest rate of 9.69%, but required  payments to be made at a rate of 6.5% per
annum (scheduled to  increase to 7.5% on January 1, 1998).  The Fuji loan was 
scheduled to mature in January 2001.

     Among other bidders, a venture comprised of Apollo Real  Estate Advisors,
L.P. ("Apollo"), an affiliate of the General  Partners, and Emmes Ventures, Inc.
("Emmes") submitted a proposal  to purchase the Fuji loan.  After a period of
negotiations, the  Apollo/Emmes proposal to purchase the Fuji loan was accepted.
Zeus Property LLC ("Zeus"), a newly-organized limited liability  company owned
by affiliates of Apollo and Emmes, purchased the  loan for $115 million on

February 28, 1996.  See "Change in  Control" below.

     In connection with its purchase of the Fuji loan, Zeus  agreed to grant the
Operating Partnership certain concessions.   The Operating Partnership obtained
a reduction in the current  interest required to be paid under the modified loan
which, based  on current projections, would greatly reduce the likelihood of 
monetary default under the loan prior to February 28, 1998, the  new maturity
date for a portion of the loan.  Zeus also arranged  to provide the Operating
Partnership with additional financing of  up to $19.5 million to be extended on
an unsecured, non-recourse  basis to be used for capital improvements and tenant
lease-up  costs to the Fuji Properties.  The amount to be loaned and the  costs
to be funded are each within the discretion of Zeus.  At 

                                      6
<PAGE>

December 31, 1996, the Partnership had borrowed approximately  $2,900,000 under
this credit line.  As part of the restructuring  of the Fuji loan, each Fuji
Property was conveyed by the  Operating Partnership to separate newly-created
limited liability  companies indirectly wholly-owned by the Operating
Partnership  and its partners. 

     The modified Fuji loan (the "Modified Loan") is comprised of  several
component non-recourse loans, all held by Zeus and its  affiliates.  The most
senior loan component consists of a series  of secured notes in the aggregate
principal amount of  $104,550,000, each having an annual interest rate of 295
basis  points over 30-day LIBOR, maturing on February 28, 1998 unless  extended
at Zeus' option (the "Secured A Notes").

     A junior component consists of secured notes in the aggregate  principal
amount of $102,450,000, each having a fixed annual  interest rate of 14% for the
next three years and then 16.75%  thereafter, maturing on February 28, 2016 (the
"Secured B Notes").  The Secured A Notes and Secured B Notes are collectively
secured  by first mortgages on the Fuji Properties.  A third component is  the
unsecured $19,550,000 note (the "Unsecured Note") representing  the additional
financing expected to be drawn upon by the  Operating Partnership to fund
capital improvements and tenant  lease-up costs with respect to the Fuji
Properties.  The Unsecured  Note bears interest at a fixed annual rate of 14%
for the next  three years and then 16.75% thereafter and matures on February 28,
1998, unless extended at Zeus' option.

     In the absence of a substantial improvement in the commercial  rental
market and the operation of the Fuji Properties, the  Partnership is not
expected be able to meet its financial  obligations on the Modified Loan beyond
March 15, 1998.  See Item  7, "Management's Discussion and Analysis of Financial
Condition  and Results of Operations" for information relating to the ability 
of the Partnership to make distributions to its partners.  The  principal
benefit of the Modified Loan to the Operating  Partnership is a substantial
reduction in current debt service  requirements through February 1998.  The only
current debt service  payments required to be made under the Modified Loan for
this two-year period are the interest payments on the Secured A Notes.  
Interest on all other components of the Modified Loan are payable  to the extent
of available cash flow from the Fuji Properties and  otherwise accrue until
sufficient cash flow is available for  payment.  On February 28, 1998, the

Secured A Notes are due and 

                                 7
<PAGE>

payable in full, unless extended at Zeus' option.  In addition, a  mandatory
prepayment of $25 million against the Secured B Notes is  required to be made on
March 15, 1998, and the Fuji Properties  will be required to meet a Value to
Loan test of 125% coverage.   As a result of the modification, the likelihood of
a monetary  default has been deferred from 1996 to 1998.  Consequently, the 
negative tax consequences associated with a foreclosure or other  transfer of
the Fuji Properties is likely to  be deferred for two  years.
 
     In exchange for this deferral, and for the credit facility of  $19.5
million available for capital improvements and tenant  leasing costs, the
Operating Partnership has agreed to modify  certain of the remedy provisions
which would apply after a  default.  Essentially, these provisions have the
effect of  facilitating and expediting a transfer of the Fuji Properties in  the
event of a default.  Further, the Modified Loan grants Zeus  the right to
require a transfer of one or more of the Fuji  Properties at any time after
March 15, 1998 or immediately in the  event Zeus delivers to the Operating
Partnership a letter from an  acceptable law firm to the effect that such
transfer will not  result in any cancellation of indebtedness income to the
Operating  Partnership.  See "Subsequent Events" below for information with 
respect to the possible sale of 1372 Broadway.  As described  below, the
Operating Partnership also consented to the replacement  of Winthrop Management
as the managing and leasing agent for the  properties and the appointment of new
third-party management and  leasing agents.  See "Property Management". 

     The Receivables Loan - 300 Park Avenue South and 509 Fifth  Avenue.  In
connection with the Modified Loan, certain affiliates  of the General Partners
(collectively, the "Affiliates") entered  into an agreement with the Operating
Partnership, the Partnership  and an affiliate of Zeus with regard to amounts
owed to the  Affiliates by the Operating Partnership and the Partnership (the 
"Winthrop Debt Agreement").  Prior to the entering into of this  agreement, the
Affiliates were owed in the aggregate approximately  $46.6 million by the
Operating Partnership and the Partnership.   This amount was comprised of cash
advances made to the Partnership  and the Operating Partnership in order to fund
operating deficits  and also includes accrued interest on outstanding balances
as well  as unpaid deferred fees related to the on-site management of the 
properties, asset management and syndication.  Under the Winthrop  Debt
Agreement, the Affiliates contributed approximately $36.6  million of the $46.6
million to the Operating Partnership.  The 

                                 8
<PAGE>

remaining $10 million receivable was evidenced by a promissory  note (the
"Receivables Note") issued by the Operating Partnership  which is secured by a
pledge of the excess cash flow from 509  Fifth Avenue and 300 Park Avenue South
and is payable only from  those properties.  See "The Dime Loan" below.  The
Receivables  Note was then sold to an affiliated of Zeus for a payment of 
$6,000,000.  The Receivables Note has an annual base interest rate  of 6% and an
additional annual contingent interest rate of 9%.   Interest is payable only

from available cash flow after payment of  debt service on the Dime Loan. 
Interest, to the extent it cannot  be paid currently, accrues until the maturity
of the Receivables  Note on July 31, 1997.

     The Dime Loan - 300 Park Avenue South and 509 Fifth Avenue.  With respect
to 509 Fifth Avenue, the loan made by Dime was in  the original principal amount
of $8,000,000.  This loan bears  interest at a rate of 9.375% per annum, is
being amortized over a  25-year period, matures on August 24, 1997 and had an
outstanding  principal balance of $7,289,000 at December 31, 1996.  In June 
1992, the Operating Partnership discontinued making its debt  service payments
on the mortgage loan with respect to 300 Park  Avenue South.  The lender, Dime,
served the Operating Partnership  with a notice of default in June 1992 and
accelerated the  payments due under the mortgage loan in August 1992.  A
$650,000  certificate of deposit was pledged as partial security for the  300
Park Avenue South mortgage.  This collateral interest was  taken by Dime in
September, 1992 as a result of the Operating  Partnership's default.  Although
Dime initiated foreclosure  proceedings, it continued to engage in discussions
with the  Operating Partnership to restructure the Dime Loan as it relates  to
300 Park Avenue South and on January 20, 1993 an agreement was  reached to
restructure the Dime Loan based on the terms described  below.  At present, the
Partnership is attempting to refinance or  restructure the Dime loan.  There can
be no assurance, however,  that the Dime loan can be refinanced or restructured
on favorable  terms or at all.

     The Dime Loan balance with respect to 300 Park Avenue South  (after taking
into account the application of the $650,000  reserve referred to above)
remained at $11,882,140 and the loan  maturity date was extended from August 31,
1997 to December 31,  1997, with the Operating Partnership having an option to
extend  the term an additional four years. This option may be exercised  by the
Operating Partnership if no event of default exists and if  one of the following
two conditions are met:

                                 9

<PAGE>

      (i)  The Dime Loan balance is no greater than 80% of the  appraised value
of 300 Park Avenue South as of December 31, 1997;  or

      (ii) A guaranty of debt service payments up to a maximum  amount of
$1,750,000 from a viable entity (as determined by Dime)  or a $1,750,000 letter
of credit is provided to Dime.

     The interest rate of 9.5% and pay rate of interest only plus  amortization
payments (based on a 30-year amortization) are  reduced as follows:

           Period            Interest Rate         Pay Rate
           ------            -------------         --------

     5/01/92 - 12/31/92          0%                   0%   
     1/01/93 - 12/31/95          8%                   6%   
     1/01/96 - 12/31/97          8%                   8%   

     The percentages shown are based on a percentage of the  $11,882,140 loan

balance and the difference between the pay rate  and the interest rate will
accrue without interest.  If the Dime  Loan is extended as discussed above, the
interest rate will equal  the four-year U.S. Treasury Note rate plus 2% with
payments  adequate to amortize the principal amount over 25 years, with  total
unpaid principal and interest due and payable on December  31, 2001.

     Reserves of $1,625,000 were established at closing and  consisted of (i)
$84,749 net cash flow provided by this  Property's operations since the default
on the Dime Loan and (ii)  $1,540,251 funded by the Operating Partnership from
the proceeds  of a loan made by WFA to the Operating Partnership (collectively, 
the "Dime Reserves").  At closing, $163,974 of the Dime Reserves  were applied
to pay for closing costs.  Subsequent to closing and  through December 31, 1995,
the Dime Reserves could have been used  to fund capital improvements, tenant
improvements and leasing  commissions (the "Dime Property Capital Expenditures")
to the  extent net income after debt service is not sufficient.  From  January
1, 1996 through maturity, the Dime Reserves may be used  to pay Dime Property
Capital Expenditures and debt service to the  extent that net income is not
sufficient.  Dime has a security  interest in the Dime Reserves and other
operating accounts of the  Operating Partnership with respect to 300 Park Avenue
South.   Upon repayment in full of the Dime Loan, any remaining Dime 

                                 10
<PAGE>

Reserves may be retained by the Operating Partnership.  As of  December 31,
1995, all of the Dime Reserves had been spent.

     The Dime Loan plus accrued interest will become due in full  at maturity or
upon a refinancing or sale of 300 Park Avenue  South.  See "Item 7, Management's
Discussion and Analysis of  Financial Condition and Results of Operations" for a
discussion  of the Operating Partnership's ability to satisfy the Dime Loan  at
maturity.  Any remaining proceeds after repayment of the Dime  Loan will be
retained by the Operating Partnership.  The  Operating Partnership may also
retain any monthly net cash flow  (defined as revenue less operating expenses,
debt service and  capital expenditures), if, among other things, (i) 300 Park 
Avenue South has adequate funds to pay the following month's debt  service and
operating expenses, and (ii) 300 Park Avenue South is  80% occupied or the Dime
Reserve has adequate funds to pay for  leasing commissions and tenant
improvements to reach 80%  occupancy.  However, it is anticipated that any
excess cash flow  will needed to make payments on the Receivables Loan.  See
"The  Receivables Loan" above.  During 1994 the Operating Partnership  retained
$346,701 of such cash flow, which was applied to the  Winthrop Loan.  No cash
flow amounts were applied to the Winthrop  Loan in 1995 or 1996.

     The Operating Partnership and WFA had provided Dime with a  guaranty of the
payment of Dime's debt service from January 1,  1993 through December 31, 1995
to the extent net income is not  sufficient, up to a total liability of
$1,250,000. No payments  were required under this guaranty.

      C. Subsequent Events
         -----------------
 
     1372 Broadway - In March 1997, Zeus informed the Partnership  that it was
exercising its rights under the Modified Loan to  cause the Operating

Partnership to sell 1372 Broadway to an  unaffiliated third party.  The
Partnership has been advised that  the letter required to be delivered from an
acceptable law firm  that provides that such a sale will not result in any 
cancellation of indebtedness income to the Partnership will be  forwarded
shortly.  The Partnership, Zeus and the purchaser are  negotiating a Purchase
and Sale contract for the property.  There  can be no assurance, however, that
the required letter will be  delivered or that a mutually acceptable Purchase
and Sale  Agreement will be negotiated.  In the event the property is sold, 

                                 11
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all of the proceeds from such sale will be required to be used to  partially
satisfy the Modified Loan.

Deferred Purchase Price
-----------------------

     In connection with the acquisition of the Properties, the  Operating
Partnership agreed to make deferred payments to the  seller in future years
equal to 6% of the gross proceeds of  certain refinancings, sales or transfers
of any of the Properties  or equal to the fair market value of any Properties
not disposed  of by January 18, 2006.  At the time of the acquisition of the 
Properties, the Operating Partnership estimated this liability at  $25,296,177
based on the cash portion of the purchase price paid  at that time.  In
connection with the various refinancings and  sales which have occurred in 1990,
as well as the payments of  $22,705,703 already made to the seller as a Deferred
Purchase  Price, the total liability is now estimated to be $1,497,612.

Winthrop Funding
----------------

     In 1985, the Partnership obtained a 99.99% interest in  Winthrop Funding
for $99.99 and also contributed to Winthrop  Funding the final installment of
the Investor Notes in the  aggregate amount of $42,998,592.  Winthrop Funding
issued zero  coupon bonds in the face amount of $40,850,000 at a discount of 
$21,367,818 with the final installment of the Investor Notes  pledged as
collateral.  As of March 1992, Winthrop Funding  collected the entire amount of
the last installment of the  Investor Notes except for $68,542 which remains
outstanding as of  December 31, 1996.  As of May 1992, Winthrop Funding paid the
entire face amount of the zero coupon bonds to the bondholders.  

Employees
---------

     As of December 31, 1996, the Partnership did not have any  employees. 
Services are generally performed for the Partnership  by the General Partners
and their affiliates and agents retained  by them.  Other services are performed
for the Operating  Partnership by affiliates and agents retained by the
Operating  Partnership.

                                      12

<PAGE>


Property Management
-------------------

     From 1985 until March 1996, Winthrop Management (a  Massachusetts general
partnership and an affiliate of WFA) or its  affiliates performed the day to day
management services for the  Properties, including preparation of operating
budgets,  collection of rents, repairs and maintenance, advertising, 
maintenance of records, maintenance of insurance and financial  reporting.  See
Item 13, "Certain Relationships and Related  Transactions."

     As part of the sale and restructuring of the Fuji loan, the  Operating
Partnership agreed to retain new management and leasing  agents for all of its
properties.  On March 1, 1996, the  Operating Partnership's properties began
being managed by Axiom  Real Estate Management, Inc. (an affiliate of Grubb &
Ellis  Company) and leasing activity will be performed by the Galbreath 
Company, Newmark & Co. and Koll Company.  These firms are neither  affiliated
with WFA nor Apollo, Emmes or Zeus, except that Apollo  is a minority
stockholder of Koll.  The terms of these contracts  are at market rates.  The
Operating Partnership is not permitted  to change the management agent or
leasing agents unless these  parties are in default of their obligations under
their  respective agreements and the Operating Partnership shall have  submitted
to Zeus a suitable replacement candidate(s), acceptable  to Zeus.  One effect of
this is to terminate the payment of all  management or leasing fees to the
General Partners and their  affiliates by the Operating Partnership, the
Partnership or the  properties.  The Partnership will receive from the
Properties up  to $240,000 as reimbursement for Partnership expenses.

Insurance
---------

     The Partnership maintains property and liability insurance  on the
Properties which it believes to be adequate.

Change in Control
-----------------

     Until December 22, 1994, the sole general partner of  Linnaeus Associates
Limited Partnership ("Linnaeus"), which was  the sole general partner of WFA,
was Arthur J. Halleran, Jr.  On  December 22, 1994, the general partnership
interest in Linnaeus  was transferred to W.L. Realty, L.P. ("W.L. Realty")
pursuant to  an Investment Agreement entered into among Nomura Asset Capital 
Corporation ("NACC"), Mr. Halleran and certain other individuals 

                                      13

<PAGE>
who comprised the then senior management of WFA.  W.L. Realty is a Delaware
limited partnership, the general partner of which was,  until July 18, 1995,
A.I. Realty Company, LLC ("Realtyco"), an  entity owned by certain employees of
NACC. On July 18, 1995  Londonderry Acquisition II Limited Partnership
("Londonderry II"),  a Delaware limited partnership, and affiliate of Apollo
Real Estate Advisors, L.P. ("Apollo"), acquired, among other things,  Realtyco's
general partner interest in W.L. Realty and a sixty  four percent (64%) limited

partnership interest in W.L. Realty and  WFA acquired the general partner
interest in Linneaus-Lexigton.

     As a result of the foregoing acquisitions, Londonderry II is  the sole
general partner of W.L. Realty, which is the sole general  partner of Linnaeus
and, which in turn is the sole general partner  of WFA.  As a result of the
foregoing, effective July 18, 1995, 

                                      14
<PAGE>

Londonderry II, an affiliate of Apollo, became the controlling  entity of Two
Winthrop and WIPI.  In connection with the transfer  of control, the officers
and directors of Two Winthrop and WIPI  resigned and Londonderry II appointed
new officers and directors.  See Item 10, "Directors and Executive Officers of
Registrant."

Item 2.  Properties.
         ----------

     The Partnership does not own any interest in real property  other than its
general partnership interest in the Operating  Partnership.  The Operating
Partnership does not own any  interests in real property other than the
Properties, which are  described under the caption "The Properties" in Item 1
above and  below.

757 Third Avenue.  The property consists of a 27-story office  building
containing approximately 468,327 rentable square feet of  space and
approximately 24,567 square feet of land.  The property  is located at the
northeast corner of Third Avenue and East  Forty-Seventh Street in midtown
Manhattan and is used principally  by telecommunications, law, financial and
retail firms.  Planned  capital improvements at the property include cooling
tower  upgrade and tenant improvements.

     MCI Telecommunications, a telecommunications company, leases 
approximately 71,064 square feet (15% of the total space).  The 
lease expires on March 31, 1997 and the total annualized rent 
payable by MCI was $2,379,416, for the year ended December 31, 
1996.  The tenant has two individual 5-year options to renew.  
The Partnership has been informed that MCI will be vacating its 
space upon expiration of its initial lease term.

     Instinet, a computer trading firm, leased approximately 
48,311 square feet (10% of total space) in 1996.  Instinet has 
extended the lease as to 31,000 square feet for a period to 
expire July 31, 1998.  The total annualized rent paid by Instinet 
for the year ended December 31, 1996 was $1,532,341.

     At present, leases are currently being negotiated that, if  entered into,
would cover all of the space vacated by MCI and  Instinet.  There can be no
assurance, however, that such leases  will be entered into.

                                      15
<PAGE>
 

     The following table sets forth the occupancy rates for the last five years
and the associated gross rental per square foot amount, as footnoted.


                              Percentage         Average Annual Total
                              Occupancy          Gross Rental Per SF
            Year              Rate(l)            of Occupied Space (2)
            ----              --------           ---------------------
            1992                92%                   46.59
            1993                94%                   42.52
            1994                95%                   42.93        
            1995                98%                   38.34
            1996                87%                   34.66



(1)   Occupancy rates are based on December 31 of indicated year and are not 
      yearly averages.

(2)   Calculated using operating revenues, including rent escalations and 
      other revenues, for the entire year divided by the total square footage 
      of occupied space (based on the occupancy rates reported in this table).

     The following table sets forth certain information  concerning lease
expirations (assuming no renewals for this  property for the period from January
1, 1997 through December 31,  2006).

        Number of      Aggregate SF  Annualized       Percentage
        Tenants Whose  Covered by    Rental for       of Total
        Leases         Expiring      Leases           Annualized
        Expire         Leases        Expiring         Rental (1)
        ------         ------        --------         ----------
  
1997     4              111,172      $ 3,944,575          31%
1998     6               40,607        1,364,510          11%
1999     4               41,411        1,782,382          14%
2000     3               12,395          359,742           3%
2001     4               12,499          461,406           4%
2002     4               51,760        2,217,749          17%
2003     5               22,716          952,376           7%
2004     0                    0                0           0% 
2005     1               11,740          359,332           3%
2006     2               76,994        1,184,472           9%

(1) Based on actual base rent plus increase from various escalation provisions 
    as of December 31, 1996.

<PAGE>

535 Fifth Avenue.  The property consists of a 36-story multi-
tenant building containing approximately 292,266 rentable square 
feet of space and approximately 16,545 square feet of land.  The 
property is located on the northeast corner of Fifth Avenue and 

East 44th Street.  The space is principally leased by personnel, 
law, banking, retail and accounting firms.  Planned capital 
improvements at the property include base building work and 
facade upgrade.

     The Chase Manhattan Bank, a financial institution, has a 
lease for 31,300 square feet (10.7% of the total space).  This 
lease expires on January 31, 2005, and the total annualized rent 
payable by Chase was $1,000,000, for the year ended December 31, 
1996.  The tenant does not have an option to renew.

                                      16

<PAGE>

    The following table sets forth the occupancy rates for the 
last five years and the associated gross rental per square foot 
amount, as footnoted.

                   Percentage             Average Annual Total
                   Occupancy               Gross Rental Per SF
    Year           Rate(1)               of Occupied Space (2)
    ----          ---------              --------------------- 
    1992            66%                        36.30
    1993            66%                        31.75
    1994            73%                        29.14
    1995            79%                        28.87
    1996            89%                        25.60


   (1)  Occupancy rates are based on December 31 of indicated year and are not 
        yearly averages.

   (2)  Calculated using operating revenues, including rent escalations and 
        other revenues, for the entire year divided by the total square footage 
        of occupied space (based on the occupancy rates reported in this 
        table).


     The following table sets forth certain information  concerning lease
expirations (assuming no renewals for this  property for the period from January
1, 1997 through December 31,  2006).


        Number of      Aggregate SF  Annualized       Percentage
        Tenants Whose  Covered by    Rental for       of Total
        Leases         Expiring      Leases           Annualized
        Expire         Leases        Expiring (1)     Rental (1)
        ------         ------        ------------     ----------
  
1997     5               15,521      $   496,220           7%
1998     3                2,304           59,157           1%
1999     7               11,163          303,176           4%
2000     4               33,193          939,720          13%

2001     2                2,427           63,096           1%
2002     3                7,775          187,699           3%
2003     3               23,227          648,762           9%
2004     3                8,035          182,690           3% 
2005     7               47,204        1,572,664          22%
2006     2                8,094          201,100           3%

  (1) Based on actual base rent plus increases from various 
      escalation provisions as of December 31, 1996.
                                      17
<PAGE>


1372 Broadway.  The property consists of 12- and 21-story  sections in a
multi-tenant building containing approximately  542,364 rentable square feet of
space and 29,040 square feet of  land.  The property is located on the northeast
corner of  Broadway and 37th Street is in the New York City garment district 
and is principally leased by garment, banking, and retail firms.  Planned
capital improvements at the property include base  building work and elevator
modernization. 

     Capital-Mercury Shirt Corporation, an apparel manufacturer,  leases 64,122
square feet (11.8% of total space).  The lease  expires on July 31, 2005 and the
total annualized rent payable by  Capital-Mercury was $1,173,700 for the year
ended December 31,  1996.  The tenant does not have an option to renew.

     NationsBank, a financial institution, leases 55,232 square  feet (10.2% of
total space).  The bank's lease expires on July  31, 2000 and the total rent
paid by the bank was $1,235,788, for  the year ended December 31, 1996. The
tenant has a 10-year  renewal option.

     Ann Taylor, a women's clothing company, leases 58,983 square  feet (10.9%
of the total space).  Ann Taylor's lease expires July  31, 2010 and the total
rent paid by the clothing company for the  year ended December 31, 1996 was
$1,169,124.  There are no  options to renew under this lease.

     The following table sets forth the occupancy rates for the  last five years
and the associated gross rental per square foot  amount, as footnoted.

                                      18
<PAGE>
                   Percentage             Average Annual Total
                   Occupancy               Gross Rental Per SF
    Year           Rate(1)               of Occupied Space (2)
    ----          ---------              --------------------- 
    1992            89%                       $21.27
    1993            96%                        20.85
    1994            93%                        21.32
    1995            96%                        23.83 
    1996            89%                        19.76

  (1)  Occupancy rates are based on December 31 of indicated year and are not 
       yearly averages.


  (2)  Calculated using operating revenues, including rent escalations and 
       other revenues, for the entire year divided by the total square footage
       of occupied space (based on the occupancy rates reported in this table).

     The following table sets forth certain information  concerning lease
expirations (assuming no renewals for this  property for the period from January
1, 1997 through December 31,  2006).


        Number of      Aggregate SF       Annualized       Percentage
        Tenants Whose  Covered by         Rental for       of Total
        Leases         Expiring           Leases           Annualized
        Expire         Leases             Expiring(1)      Rental (1)
        ------         ------             -----------      ----------
  
1997     0                  0         $         0              0
1998     2              2,847              83,332              1%
1999     4              4,770              79,778              1%
2000     3             74,847           1,938,215             18%
2001     0                  0                   0              0%
2002     6             56,138             504,463              5%
2003     1             20,500             426,916              4%
2004     0                  0                   0              0%
2005     2             99,402           1,874,840             17% 
2006     2              7,527             446,520              4%

  (1)   Based on actual base rent plus increase from various escalation 
        provisions as of December 31, 1996.

545 Fifth Avenue.  The property consists of a 13-story multi-tenant building
containing 173,878 rentable square feet of space  and approximately 12,575
square feet of land.  The property is  located on the southeast corner of Fifth
Avenue and East 45th  Street.  The space is principally leased by post
production,  communication and retail firms.  Planned capital improvements at 

                                      19
<PAGE>

the property include base building work.  The property's book  value and gross
revenues contribute less than 10 percent to the  total assets and revenue of the
registrant and its consolidated  subsidiaries.

509 Fifth Avenue.  The property consists of a 12-story building  containing
53,800 rentable square feet of space and 4,625 square  feet of land. The
property is located between East 42nd and 43rd  streets in midtown Manhattan. 
The space is used by banking and  retail businesses.  The property's book value
and gross revenues  contribute less than 10 percent to the total assets and
revenue  of the registrant and its consolidated subsidiaries. Planned  capital
improvements at the property include elevator cab  rehabilitation.

300 Park Avenue South.  The property consists of a 14-story  multi-tenant office
building containing approximately 176,895  rentable square feet of space and
11,406 square feet of land.   The property is located on the northeast corner of
Park Avenue  South and East 22nd in the Gramercy Park area of Manhattan.  The 

space is used by a variety of businesses, including, publishing,  personnel and
modeling agencies.  The property's book value and  gross revenues contribute
less than 10 percent to the total  assets and revenue of the registrant and its
consolidated  subsidiaries.  Planned capital improvements at the property 
include sidewalk restoration. 

 Item 3. Legal Proceedings.

     To the best of the General Partners' knowledge, as of  December 31, 1996,
there are no material pending legal  proceedings to which the Partnership or the
Operating Partnership  is a party or to which any of their properties are
subject.

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

     No matter was submitted to a vote of security holders during  the period
covered by this report.
                                      20
<PAGE>


                                    PART II

 Item 5.     Market for Registrant's Common Equity and Related Stockholder
             Matters.

     There is no public trading market for the Units of limited  partnership
interest in the Partnership.  Trading is infrequent  and occurs only through
private transactions.  Furthermore,  transfers of Units are subject to
significant limitations  contained in the Partnership's partnership agreement
including a  requirement that the General Partners consent to the transfer, 
which consent may be granted or withheld in the sole discretion  of the General
Partners.  A copy of the Partnership's partnership  agreement (the "Partnership
Agreement") was filed as Exhibit 3 to  the Registration Statement.

     As of March 1, 1997, there were 1,181 holders of 1,339 Units.

     The Partnership Agreement provides that Cash Flow (as  defined therein)
will be distributed to the partners in specified  proportions at reasonable
intervals during the fiscal year, but  in any event no less often than 90 days
after the close of each  fiscal year.  There are no restrictions under the
Partnership  Agreement on the Partnership's present or future ability to make 
distributions of cash flow.  The Partnership, at the sole  discretion of the
General Partners, may retain all or any portion  of the Partnership's net
distributable cash flow to the extent  deemed necessary to cover anticipated
expenses and to provide  reserves for unexpected future property and Partnership
financial  needs.  Cash flow distributed to partners will be net of any such 
amounts so retained.  The Partnership did not make any cash  distributions in
1996, 1995 or 1994.  See Item 7, "Management's  Discussion and Analysis of
Financial Condition and Results of  Operations" for information with respect to
the Partnership's  ability to make distributions in the future.
                                      21
<PAGE>

 Item 6. Selected Financial Data.

     The following represents selected financial data for  Registrant for the
years ended December 31, 1996, 1995, 1994, 1993  and 1992. The data should be
read in conjunction with the  financial statements included elsewhere herein. 
This data is not  covered by the independent auditors' report.


                                  For the Year Ended December 31,
                                  -------------------------------
                             1996       1995      1994       1993        1992
                             ----       ----      ----       ----        ----
                                  (in thousands except per unit data)

Total Revenues           $ 45,403  $  49,525  $  50,227  $  53,373   $  65,587

Total Expenses             64,531     88,733     63,858     68,436      94,781

Loss Before Gain(Loss)
  on Sales                (19,128)   (39,208)   (13,631)   (15,063)    (29,094)

   
Gain(Loss) on Sale of
  Properties/Interest
  in Joint Venture            --         --          --      1,403      (2,826)

Net Loss Before
  Extraordinary Gain      (19,128)   (39,208)   (13,631)   (13,660)    (31,920)

Extraordinary Gain         14,419         --          --    40,091         --

Net Income (Loss)        $ (4,709) $ (39,208) $ (13,631) $  26,431   $ (31,920)
                         ========  =========  =========  =========   =========
Net (Loss) Income 
  per Unit of
  Limited Partnership 
  Outstanding            $ (5,740) $ (27,747) $  (9,997) $  17,731   $ (22,682)

Total Assets              163,647    178,713    214,670    223,715     283,083

Total Liabilities (1)     287,429    334,948    331,697    337,854     423,653

Investment in Joint
  Ventures Total 
  Deficit (2)            $123,782  $ 156,235  $(117,027) $(114,139)  $(140,570)

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

  (1)  Total Liabilities includes long-term debt net of unamortized discount of
       $320,415,000, $252,658,000, $251,641,000, $250,681,000 and $224,342,000
       for the years 1992, 1993, 1994, 1995 and 1996 respectively.

  (2)  Does not include receivables represented by Investor Note installments
       totaling $68,542 at December 31, 1992, 1993, 1994, 1995 and 1996. Such 
       installments are credited to capital upon actual receipt.

                                      22

<PAGE>
Item 7.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations

          This Item should be read in conjunction with the Consolidated
          Financial Statements and other Items contained elsewhere in this
          Report.

          Liquidity and Capital Resources

          The Partnership serves as the general partner of Nineteen New York
          Properties Limited Partnership (the "Partnership"). All of the
          Partnership's six remaining properties (the "Properties") are office
          buildings located in New York City. The Registrant's sole source of
          revenue is from distributions from the Partnership and interest income
          on cash reserves. The Registrant is responsible for its operating
          expenses. The Partnership receives rental revenue from tenants and is
          responsible for operating expenses, administrative expenses, capital

          improvements and debt service payments.

          The Registrant and the Partnership had $125,000 of cash and cash
          equivalents and $9,406,000 of restricted cash at December 31, 1996, as
          compared to $267,000 and $11,633,000, respectively, at December 31,
          1995. Restricted cash includes amounts held in mortgage collateral
          accounts, restricted operating accounts, tenant security and utility
          deposits, and real estate tax escrows. The $142,000 decrease in cash
          and cash equivalents at December 31, 1996, as compared to December 31,
          1995, was due to $8,412,000 of cash used in investing activities and
          $4,861,000 of cash used in operating activities, which were
          substantially offset by $13,131,000 of cash provided by financing
          activities. Cash used in investing activities consisted primarily of
          $7,549,000 of improvements to real estate, the majority of which were
          building improvements. Cash provided by financing activities consisted
          of the accrual of $11,138,000 of interest on mortgage notes payable,
          $2,892,000 in borrowings against the unsecured line of credit, and
          $786,000 of accrued and unpaid interest on the Receivables Note. In
          addition, Registrant used $1,829,000 of cash provided by financing
          activities for principal payments on mortgage notes to affiliates. All
          other increases (decreases) in certain assets and liabilities are the
          result of the timing of receipt and payment of various activities.

          The Partnership's only other source of liquidity is a $19,550,000
          unsecured credit line provided by Zeus. This credit line can be used
          by the Partnership to fund capital improvements and tenant lease-up
          costs at the Fuji Properties. However, any borrowings under this
          credit line are subject to Zeus' discretion. Accordingly, it is
          possible that the Partnership may not be able to borrow against this
          credit line each time it deems it necessary. As of December 31, 1996,
          the outstanding borrowings against the unsecured credit line were
          $2,892,000.

          On February 28, 1996, Zeus purchased the existing debt held by Fuji
          for $115 million. See Item 1, AProperty Matters" and Item 8,
          AConsolidated Financial Statements and Supplementary Data", Notes 3
          and 4, for a description of the terms and conditions of the current
          loans encumbering Registrant's Properties. The Registrant has maturing
          mortgage debt, totaling approximately $29,000,000 plus accrued
          interest due in 1997, approximately $103,000,000 due February 28, 1998
          and a $25,000,000 mandatory principal payment due March 15, 1998. The
          Registrant is attempting to refinance or restructure the 1997
          liabilities. However, based on the current value of the Properties it
          is highly unlikely the Registrant will be able to meet its 1998
          obligations. Accordingly, it appears there is a substantial likelihood
          that some or all of the Properties will be lost through foreclosure in
          1998. This raises substantial doubt about the Partnerships' ability to
          continue as a going concern.

<PAGE>
Item 7.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations (Continued)

          It appears that the Registrant's original objective of capital

          appreciation will not be achieved and the Registrant's partners will
          not receive a return of their original investment.

          In January 1996, the Partnership transferred the title to the property
          located at 227 East 45th Street to Sanwa Business Credit Corporation
          ("Sanwa") pursuant to a deed in lieu of foreclosure. In exchange,
          Sanwa released, as of the closing date, the Partnership from all
          claims, demands, liabilities, obligations, actions and causes of any
          kind with regards to Sanwa. As a result of the above described
          transactions, the Partnership recognized an extraordinary gain on the
          transfer of 227 East 45th Street of $14,419,000 in 1996.

          As part of the debt restructuring process, the Partnership reviewed
          the Properties to determine whether they have suffered an impairment
          in value which is deemed to be other than temporary. The Partnership
          determined that, based upon current economic conditions and projected
          operational cash flows, the recovery of the carrying value of the
          Partnership's Properties was not likely. As a result, the Partnership
          wrote down its investment in the Properties by $22,500,000 in 1995 to
          their estimated fair value.

          There have been, and it is possible there may be other Federal, state
          and local legislation and regulations enacted relating to the
          protection of the environment and individual rights (such as the
          American with Disabilities Act). The Partnership is unable to predict
          the extent, if any, to which such new legislation or regulation might
          occur and the degree to which such existing or new legislation or
          regulations might adversely affect the Partnership's liquidity and
          capital resources.

          Real Estate Market

          The income and expenses of operating the Properties owned by the
          Partnership are subject to factor's outside its control, such as the
          over-supply of similar properties, increases in unemployment,
          population shifts, or changes in patterns or needs of users. Expenses,
          such as local real estate taxes and miscellaneous expenses, are
          subject to change and cannot always be reflected in rental rate
          increases due to market conditions. In addition, there are risks
          inherent in owning and operating office buildings because such
          properties are labor intensive and are susceptible to the impact of
          economic and other conditions outside the control of the Registrant.

          Results of Operations

          1996 compared to 1995

          The Registrant generated a net loss before extraordinary gain of
          approximately $19.1 million for the year ended December 31, 1996, as
          compared to a net loss of approximately $39.2 million for the year
          ended December 31, 1995. The decrease in net loss was due to the loss
          due to permanent impairment recorded in 1995.

          Base rent and rent escalations (collectively "rental income")

          decreased to approximately $44.8 million for the year ended December
          31, 1996 as compared to approximately $48.6 million for the year ended
          December 31, 1995. Rental income was negatively impacted by the loss
          of the 227 East 45th property by $3,125,000, coupled with a decrease
          in rental income at 757 Third Avenue and 1372 Broadway of $1,992,000
          and $1,236,000, respectively, for the year ended December 31, 1996, as
          compared to 1995.

<PAGE>
Item 7.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations (Continued)

          These decreases were partially offset by an increase in rental income
          at 535 Fifth Avenue of $1,075,000. The lower rental revenues were
          primarily the result of lower effective rental rates and decreased
          occupancy. Rental income at the other properties remained relatively
          constant.

          Expenses, before loss for permanent impairment of 22.5 million, for
          the year ended December 31, 1996, as compared to 1995, declined by
          approximately $1,702,000 partially as a result of the loss of
          Registrant's 227 East 45th Street property. The decreases in overall
          operating expenses (i.e., real estate and other taxes, payroll,
          utilities, repairs and maintenance, and cleaning and security) of
          $2,019,000, asset and property management fees of $1,102,000 and
          depreciation and amortization expense of approximately $1,680,000,
          were only partially offset by an increase in interest expense of
          $3,633,000.

          Operating expenses declined as a result of Registrant's 227 East 45th
          Street deed in lieu of foreclosure. Asset and property management fees
          declined due to the elimination of the asset management fee payable to
          a related party, the new management agreement (which changed the
          previous fee of 2.5% of cash receipts to a fixed fee) and the
          disposition of Registrant's 227 East 45th Street property.
          Depreciation and amortization expenses declined due to the recorded
          loss on permanent impairment recorded on Registrant's properties.

          The extraordinary gain was recognized on the transfer of Registrant's
          227 East 45th Street property. The recorded amount of all of the
          obligations associated with the property was $25,140,000, which
          exceeded the net book value of assets and liabilities of the property
          by $14,419,000.

          As of December 31, 1996 and 1995, the current portfolio's occupancy
          was 84% and 89%, respectively. For the year ended December 31, 1996,
          the Partnership signed new, renewal, extension, and expansion leases
          totaling 143,000 square feet at rental terms comparable to buildings
          of similar quality in the market. This leasing activity only slightly
          offset the decline in occupancy.

          1995 compared to 1994

          The Registrant's total revenues decreased $703,000 or 1.4% for the

          period ended December 31, 1995 as compared to December 31, 1994 from
          $50,227,000 in 1994 to $49,524,000 in 1995. Increases in base rental
          income of $1,537,000 and rental escalations of $282,000 in 1995 as
          compared to 1994 were more than offset by a decrease in other income
          of $2,521,000 in 1995 as compared to 1994.

          Total expenses of the Partnership increased $24,874,000 in 1995 as
          compared to 1994 from $63,858,000 in 1994 to $88,732,000 in 1995. The
          major component of the increase in total expenses was the
          Partnership's writing down its investment in the Properties by
          $22,500,000 as a result of management determining that future cash
          flows would not enable the Partnership to recover its investment.
          Management considered various factors, which included the recessionary
          effects on commercial real estate markets, current and future expected
          occupancy rates and prospects for leasing at rates sufficient to
          support the existing carrying value of the properties.

          Additionally, interest expense increased by $2,453,000 in 1995 as
          compared to 1994, as a result of compounding of the interest on debt
          balances. The remaining decrease in operating expenses was $79,000 or
          .1% in 1995 as compared to 1994. Significant capital expenditures in
          1995 included elevator rehabilitation, work chiller replacement and
          tenant improvements.

<PAGE>
Item 7.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations (Continued)

          Operating results at each of the properties were as follows:

          1372 Broadway

          Total revenues for the Property in 1995 increased by 11.7% or
          $1,289,000 for the period ended December 31, 1995 as compared to
          December 31, 1994. The increase in rental revenues resulted from
          occupancy increasing from 84% at December 31, 1994 to 96% at December
          31, 1995 while average rental rates moved from $21.32 per square foot
          in 1994 to $23.83 per square foot in 1995.

          Additional revenue increases of 13.2% were recognized in tenant
          reimbursements which increased by $301,000 from $2,286,000 in 1994 to
          $2,587,000 in 1995.

          Total Operating expenses and real estate taxes increased by $407,000
          from $5,358,000 in 1994 to $5,765,000 in 1995. Significant increases
          were recognized in real estate tax expense ($427,000) while the
          remaining expenditure changes related to a $20,000 savings in 1995.

          Capital expenditures decreased from $3,332,000 in 1994 to $1,671,000
          in 1995. The decrease was the result of the 1994 including significant
          leasing activity and tenant improvement outlays.

          757 Third Avenue


          Total revenues for the Property in 1995 decreased by 5.2% or 985,000
          as compared to 1994 from $18,849,000 to $17,864,000. The decrease in
          revenues is the result of a decline in average rental rates. Average
          rental rates decreased in 1995 to $38.34 per square foot from $42.93
          per square foot in 1994. The decline in rental rates was partially
          offset by increased occupancy which was 98% at December 31, 1995
          compared to 95% at December 31, 1994. Additional revenue decreases 
          were recognized in interest and other income.

          Operating  expenses and real estate taxes  increased by 1.5% to 
          $9,048,000 in 1995 from  $8,916,000 in 1994.  Increases in
          most expense categories netted to cost of living adjustments.

          Capital expenditures, including building improvements, tenant
          improvements and leasing commission amounted to $2,325,000 in 1995
          versus $1,484,000 in 1994. Significant expenditures in 1995 were
          $1,300,000 for a chiller replacement and $152,000 for caulking of the
          exterior facade.

          535 Fifth Avenue

          Total revenues for the Property in 1995 increased by 6.9% from
          $6,200,000 in 1994 to $6,629,000 in 1995. Increased rental revenues of
          approximately $452,000 resulted from occupancy increasing from 73% at
          December 31, 1994 to 79% at December 31, 1995 while average rental
          rates moved from $29.14 per square foot in 1994 to $28.87 per square
          foot in 1995.

          Total operating expenses and real estate taxes decreased by $31,000 or
          .5% from $4,829,000 in 1994 to $4,798,000 in 1995. A decrease in real
          estate tax expense of $220,000 was partially offset by an increase in
          utility charges of $179,000.
<PAGE>
Item 7.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations (Continued)

          Capital expenditures for 1994 and 1995 amounted to $4,162,000 and
          $2,742,000, respectively, or a decrease of $1,420,000 primarily as a
          result of decreased tenant-improvement costs in 1995. The buildout
          costs in 1994 resulted in the increased 1995 occupancy.

          545 Fifth Avenue

          As a result of stable occupancy, total revenues for the Property in
          1995 of $3,432,000 were almost identical to the 1994 total revenue
          amount of $3,430,000.

          Operating expenses and real estate taxes increased by $79,000 or 3%
          from $2,865,000 in 1994 to $2,944,000 in 1995. The increase in
          expenses were primarily in utilities of approximately $146,000 and
          legal expenses of approximately $125,000. These increases were
          partially offset by savings in administrative expenses of $32,000 and
          real estate taxes of $134,000.


          Capital expenditures decreased from $3,397,000 in 1994 to $1,719,000
          in 1995 primarily as a result of decreased building common area
          improvement expenditures.

          300 Park Avenue South

          Total revenues for the Property increased in 1995 by 14.2% from
          $3,428,000 in 1994 to $3,927,000 in 1995. Rental revenues increased as
          a result of increases in existing tenants rent and one new lease at
          the end of 1994, with occupancy being 97% at December 31, 1994 and
          December 31, 1995.

          Operating expenses and real estate taxes increased by 5.4% in 1995 as
          compared to 1994 from $2,220,000 in 1994 to $2,340,000 in 1995. The
          increase is a result of higher repairs and maintenance expenses
          primarily in plumbing repairs of $55,000, as well as utilities charges
          increasing by approximately $99,000.

          Capital expenditures decreased in 1995 from $1,559,000 in 1994 to
          $599,000 in 1995 with the significant decrease coming from decreased
          tenant buildout costs. The tenant buildout expenditures in 1994
          benefited the property revenues in 1995.

          227 East 45th Street

          Total revenues at the property decreased by $587,000 or 15% in 1995 as
          compared to 1994. The decrease in total revenues was the result of
          lower base rental charges in 1995 of approximately $321,000 and
          reduced porter wage escalation income in 1995 of $289,000.

          Total  operating  expenses  decreased from $2,348,000 in 1994 to 
          $2,240,000 in 1995 or 4.6%.  Capital  expenditures at the property 
          were minimal in both 1994 and 1995.

          As a result of the declining operating results at the property the
          Partnership reached a deed in lieu of foreclosure agreement with the
          lender on January 4, 1996 (see "Item 1, Business-Sales/Dispositions"
          for further details).

<PAGE>
Item 7.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations (Continued)

          509 Fifth Avenue

          Total revenue at the Property decreased by $46,000 or by 2.2% in 1995
          as compared to 1994 from $2,118,000 in 1994 to $2,072,000 in 1995. The
          decrease in revenues is attributed to lower retail rental income of
          approximately $96,000 which was primarily offset by increased
          escalation charges of approximately $52,000.

          Total operating expenses increased from $932,000 in 1994 to 
          $982,000 in 1995 or a 5.4% increase. This increase is primarily the 
          result of higher real estate tax expense of $47,000 in 1995.


<PAGE>
Item 8.  Financial Statements and Supplementary Data

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                      CONSOLIDATED FINANCIAL STATEMENTS

                         YEAR ENDED DECEMBER 31, 1996

                                    INDEX

                                                                        Page
                                                                        ----
Independent Auditors' Reports........................................   F - 2

Consolidated Financial Statements:

Balance Sheets as of December 31, 1996 and 1995......................   F - 4

Statements of Operations for the Years Ended
  December 31, 1996, 1995 and 1994...................................   F - 6

Statements of Changes in Partners' Deficit for the Years Ended
  December 31, 1996, 1995 and 1994...................................   F - 7

Statements of Cash Flows for the Years Ended
  December 31, 1996, 1995 and 1994...................................   F - 8

Notes to Consolidated Financial Statements...........................   F - 9

Financial Statement Schedule:

Schedule III - Real Estate and Accumulated Depreciation at December 31, 1996

Financial statement schedules not included have been omitted because of the
absence of conditions under which they are required or because the information
is included elsewhere in the consolidated financial statements.

                                    F - 1

<PAGE>
                         Independent Auditors' Report

To the Partners
1626 New York Associates Limited Partnership:

We have audited the accompanying consolidated balance sheet of 1626 New York
Associates Limited Partnership, (a Massachusetts limited partnership) and
subsidiaries (the "Partnership") as of December 31, 1996, and the related
consolidated statements of operations, changes in partners' deficit and cash
flows for the year then ended. Our audit also included the consolidated
financial statement schedule supplied pursuant to Item 14(a)(2). These
consolidated financial statements are the responsibility of the Partnership's

management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.

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

The accompanying consolidated financial statements have been prepared assuming
that the Partnership will continue as a going concern. As discussed in Note 2 to
the consolidated financial statements, the Partnership has balloon payments
totaling in excess of $29,000,000 due during 1997 and approximately $128,000,000
due in early 1998. The inability of the Partnership to meet these obligations
raises substantial doubt about the Partnership's ability to continue as a going
concern. The consolidated financial statements do not include any adjustments
that might result from the outcome of these uncertainties.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of 1626
New York Associates Limited Partnership and subsidiaries as of December 31,
1996, and the results of their operations and their cash flows for the year then
ended in conformity with generally accepted accounting principles. Also in our
opinion, the related financial statement schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly, in all material respects, the information set forth therein.

                                                  /s/ Imowitz Koenig & Co., LLP

New York, N.Y.
March 13, 1997

                                    F - 2


<PAGE>
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Partners of 1626 New York Associates Limited Partnership:

We have audited the accompanying consolidated balance sheet of 1626 New York
Associates Limited Partnership (a Massachusetts limited partnership) and as of
December 31, 1995, and the statements of operations, changes in partners'
deficit and cash flows for each of the two years in the period ended December
31, 1995. These consolidated financial statements and the schedule referred to
below are the responsibility of the Partnership's management. Our responsibility
is to express an opinion on these consolidated financial statements and the
schedule based on our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of 1626 New York
Associates Limited Partnership and subsidiaries as of December 31, 1995, and the
results of their operations and their cash flows for each of the two years in
the period ended December 31, 1995 in conformity with generally accepted
accounting principles.

                                                            ARTHUR ANDERSEN LLP

Boston, Massachusetts
March 15, 1996
                                    F - 3

<PAGE>

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                    CONSOLIDATED STATEMENTS OF OPERATIONS
                       (In Thousands, Except Unit Data)



                                                            DECEMBER 31,
                                                    ------------------------
                                                       1996           1995
                                                    ---------       --------
ASSETS

Real estate:

    Land                                             $  24,440     $  26,477
    Buildings and improvements, net of accumulated
       depreciation of $130,617 and $129,020
       in 1996 and 1995, respectively                  110,878       119,260
                                                      --------      --------
                                                       135,318       145,737
Other Assets:

    Cash and cash equivalents                              125           267
    Restricted cash                                      9,406        11,633
    Accounts receivable, net of reserves of $748
     and $411 in 1996 and 1995, respectively               751           756
    Prepaid expenses and other assets                    4,796         5,827
    Deferred rent receivable                             8,424         8,233
    Deferred costs, net of accumulated amortization
     of $21,786 and $21,435 in 1996 and 1995,
     respectively                                        4,827         6,260
                                                      --------      --------   
Total Assets                                          $163,647      $178,713
                                                      ========      ======== 

               See notes to consolidated financial statements.

                                     F-4

<PAGE>

                  1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                           CONSOLIDATED BALANCE SHEETS
                        (In Thousands, Except Unit Data)
                                 (Continued)


LIABILITIES AND PARTNERS' DEFICIT                           DECEMBER 31,
---------------------------------                  -----------------------------
                                                       1996           1995
                                                       ----           ----
Liabilities:

  Mortgage notes payable to affiliates               $ 205,171      $     --
  Other mortgage notes payable                          19,171       250,681
  Accounts payable, notes and loans payable,
    and accrued interest to general partners
    and affiliates                                      13,695        46,222
  Accounts payable, accrued expenses, security
    deposits and other liabilities                       8,826         8,617
  Accrued interest on mortgage notes to affiliates      38,108            --
  Accrued interest on other mortgage notes                 960        27,930
  Deferred purchase price obligation                     1,498         1,498
                                                     ---------     --------- 
Total Liabilities                                      287,429       334,948
                                                     ---------     --------- 
Commitments and Contingencies

Partners' Deficit:

  Limited Partners Deficit - Units of Investor
    Limited Partnership Interest $250,000
    stated value per unit; authorized, issued
    and outstanding -1,340 as of December 31, 1996
    and 1995, respectively                            (129,148)     (121,457)
 
  Less: investor notes                                     (68)          (68)
                                                     ---------     --------- 
                                                      (129,216)     (121,525)

  General Partners Equity (Deficit)                      5,434       (34,710)
                                                     ---------     --------- 

    Total Partners' Deficit                           (123,782)     (156,235)
                                                     ---------     --------- 
Total Liabilities and Partners' Deficit              $ 163,647     $ 178,713
                                                     =========     ========= 
               See notes to consolidated financial statements.

                                     F-5

<PAGE>

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                    CONSOLIDATED STATEMENTS OF OPERATIONS
                       (In Thousands, Except Unit Data)

<TABLE>
<CAPTION>
                                                                                       YEARS ENDED DECEMBER 31,
                                                                      ------------------------------------------------------
                                                                           1996               1995                  1994
                                                                       -----------         ------------         -------------
<S>                                                                   <C>                 <C>                   <C>
Revenues:                                   
  Base rent                                                            $     36,435        $     38,319          $     36,782   
  Rent escalations                                                            8,391              10,231                 9,949
  Other                                                                         577                 975                 3,496
                                                                       ------------        ------------          ------------
   Total revenues                                                            45,403              49,525                50,227
                                                                       ------------        ------------          ------------
Expenses (including $21,961, $6,547 and $5,910
  paid or accrued to the general partners and affiliates
  in 1996, 1995 and 1994) (see Notes 4 and 6):

  Interest                                                                   25,756              22,123                19,670
  Depreciation and amortization                                              13,625              15,305                15,408
  Real estate and other taxes                                                 9,626              10,339                10,139
  Utilities                                                                   4,889               5,130                 4,687
  Cleaning and security                                                       3,804               4,416                 4,532
  Asset and property management fees                                          1,460               2,562                 2,544
  Repairs and maintenance                                                     1,563               1,774                 1,816
  Payroll                                                                     1,198               1,440                 1,433
  General and administrative                                                  1,219               1,548                 1,865
  Professional fees                                                           1,049               1,288                   794
  Provision for doubtful accounts                                               342                 308                   970
  Loss due to permanent impairment                                               --              22,500                    --
                                                                       ------------        ------------          ------------
     Total expenses                                                          64,531              88,733                63,858
                                                                       ------------        ------------          ------------
Loss before extraordinary gain                                              (19,128)            (39,208)              (13,631)

  Extraordinary gain on transfer of 227 East 45th Street                     14,419                  --                    --
                                                                       ------------        ------------          ------------
Net loss                                                               $     (4,709)       $    (39,208)         $    (13,631)
                                                                       ============        ============          ============
Net income (loss) allocated to general partners                        $      2,982        $     (2,027)         $       (235)
                                                                       ============        ============          ============
Net loss before extraordinary item allocated to                                      
   investor limited partners                                           $    (18,393)       $    (37,181)         $    (13,396)

Extraordinary gain allocated to investor limited partners                    10,702                  --                    --
                                                                       ------------        ------------          ------------
Net loss allocated to investor limited partners                        $     (7,691)       $    (37,181)         $    (13,396)
                                                                       ============        ============          ============
Net loss per unit of investor limited partnership

   interest before extraordinary gain                                  $ (13,726.12)       $ (27,747.01)         $  (9,997.01)

Extraordinary gain per unit of investor limited
   partnership interest                                                    7,986.57                  --                    --
                                                                       ------------        ------------          ------------
Net loss per unit of investor limited
   partnership interest                                                $  (5,739.55)       $ (27,747.01)         $  (9,997.01)
                                                                       ============        ============          ============
</TABLE>

               See notes to consolidated financial statements.

                                     F-6
<PAGE>

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

           CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' DEFICIT
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
                       (In Thousands, Except Unit Data)


                              Units of
                              Investor     Investor    General
                               Limited     Limited    Partners'    Total
                             Partnership  Partners'   (Deficit)   Partners'
                              Interest    (Deficit)    Equity     (Deficit)
                             -----------  ---------   ---------   ---------  

Balance - December 31, 1993     1,344     $ (70,948)  $ (43,191)  $(114,139)
 
   Abandonments                    (4)           --          --          --

   Net Loss                        --       (13,396)       (235)    (13,631)

   Capital Contributions           --            --      10,743      10,743
                              -------     ---------   ---------   ---------   
Balance - December 31, 1994     1,340       (84,344)    (32,683)   (117,027)
   Net Loss                        --       (37,181)     (2,027)    (39,208)
                              -------     ---------   ---------   ---------   
Balance - December 31, 1995     1,340      (121,525)    (34,710)   (156,235)

   Net (Loss) Income               --        (7,691)      2,982      (4,709)

   Capital Contributions           --            --      37,162      37,162
                              -------     ---------   ---------   ---------   
Balance - December 31, 1996     1,340     $(129,216)  $   5,434   $(123,782)
                              =======     =========   =========   =========   


               See notes to consolidated financial statements.

                                     
                                     F-7




                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In Thousands)

<TABLE>
<CAPTION>
                                                                   YEARS ENDED DECEMBER 31,
                                                        ------------------------------------------------

                                                            1996             1995              1994
                                                        ---------------  --------------   --------------
<S>                                                     <C>              <C>              <C>
Cash Flows from Operating Activities:

Net loss                                                $       (4,709)  $     (39,208)   $     (13,631)
Adjustments to reconcile net loss to net cash
 (used in) provided by operating activities:
     Depreciation and amortization                              13,625          15,305           15,408
     Interest expenses to related party                            694           3,765            2,197
     Deferred fees to related party                                267           1,858            2,057
     Change in deferred rent receivable                         (2,023)         (1,032)            (962)
     Reduction in carrying value of 
       income producing properties                                   -          22,500                -
     Gain on transfer of 227 East 45th Street                  (14,419)              -                -

Changes in operating assets and liabilities:

    Decrease (increase) in accounts receivable, prepaid
       expenses and other assets                                   345            (618)             233
    Increase (decrease) in accounts payable, 
       accrued expenses, security deposits 
       and other liabilities                                     1,359          (4,765)           1,830
    Increase in accrued mortgage interest                            -           2,877            1,314
                                                        ---------------  --------------   --------------
         Net cash (used in) provided by 
           operating activities                                 (4,861)            682            8,446
                                                        ---------------  --------------   --------------

Cash Flows from Investing Activities:

    Additions to buildings and improvements                     (7,549)         (7,746)         (12,153)
    Increase in deferred costs                                    (863)         (1,510)          (1,887)
                                                        ---------------  --------------   --------------
         Cash used in investing activities                      (8,412)         (9,256)         (14,040)
                                                        ---------------  --------------   --------------

Cash Flows from Financing Activities:

    Increase in accrued mortgage interest                       11,138              -                -
    Principal payments on mortgage notes to affiliates          (1,829)             -                -

    Increase (decrease) in accounts payable, notes and 
       loans payable and accrued interest to 
       general partners and affiliates                           3,694             475           (1,795)
    Principal payments on other mortgage notes                    (101)           (959)          (1,017)
    Decrease in restricted cash                                    229           9,217            7,250
                                                        ---------------  --------------   --------------
       Net cash provided by financing activities                13,131           8,733            4,438
                                                        ---------------  --------------   --------------
       Net (decrease) increase in cash 
         and cash equivalents                                     (142)            159           (1,156)
Cash and cash equivalents, beginning of year                       267             108            1,264
                                                        ---------------  --------------   --------------
Cash and cash equivalents, end of year                  $          125   $         267    $         108
                                                        ===============  ==============   ==============

Supplemental Disclosure of  Cash Flow Information:
    Cash paid for interest                               $       13,120   $      16,368   $       16,839
                                                         ==============  ==============   ==============
Supplemental Disclosure of Non-Cash Investing
   and Financing Activities:

</TABLE>
     

    Deed in lieu of foreclosure - See Note 5
    Related party debt forgiveness and modification - See Notes 2 and 6

               See notes to consolidated financial statements.
  
                                  F - 8



<PAGE>

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 1 - ORGANIZATION

         1626 New York Associates Limited Partnership (the "Investor
         Partnership") was organized on December 6, 1983 under the
         Massachusetts Uniform Limited Partnership Act to acquire and own
         a 99% General Partnership interest in and serve as a General
         Partner of Nineteen New York Properties Limited Partnership, a
         Massachusetts Limited Partnership (the "Operating Partnership"),
         which was also organized on December 6, 1983. The Investor
         Partnership and the Operating Partnership are collectively
         referred to as the "Partnerships."

         As of December 31, 1996, the Operating Partnership owns six
         commercial rental properties. These properties are referred to
         herein individually as a "Property" and collectively as the
         "Properties".

         The Operating Partnership financed the purchase of the
         Properties through a private offering by the Investor
         Partnership of 1,344 units of Limited Partnership Interest at
         $250,000 per Unit (the "Unit") for an approximate 94% interest
         in operating profits and losses of the Investor Partnership (see
         Note 6).

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Basis of Presentation - Going Concern

         The accompanying financial statements have been prepared on a
         going concern basis, which contemplates the realization of
         assets and the satisfaction of liabilities in the normal course
         of business. The Partnerships have maturing mortgage debt,
         totaling approximately $29,000,000 plus accrued interest due in
         1997, approximately $103,000,000 due February 28, 1998 and a
         $25,000,000 mandatory principal payment due March 15, 1998 (see
         Notes 3, 4 and 6). The Partnership is attempting to refinance or
         restructure the 1997 liabilities. However, based on the current
         value of the Properties it is highly unlikely the Partnerships
         will be able to meet their 1998 obligations. This raises
         substantial doubt about the Partnerships' ability to continue as
         a going concern. The consolidated financial statements do not
         include any adjustments that might result from the outcome of
         these uncertainties.

         Consolidation

         The accompanying consolidated financial statements of the

         Investor Partnership have been prepared on a consolidated basis
         with those of the Operating Partnership, its wholly-owned
         subsidiaries and Winthrop Funding 1626 Limited Partnership. All
         significant intercompany accounts and transactions have been
         eliminated in consolidation.

                                    F - 9

<PAGE>
                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Use of Estimates

         The preparation of financial statements in conformity with
         generally accepted accounting principles requires management to
         make estimates and assumptions that affect the amounts reported
         in the financial statements and accompanying notes. Such
         estimates that are particularly susceptible to change relate to
         the Partnership's estimate of the fair value of real estate.
         Actual results could differ from those estimates.

         Real Estate

         Real estate is carried at cost, adjusted for depreciation and
         impairment of value. Acquisition fees are capitalized as a cost
         of real estate. On January 1, 1996, the Partnership adopted
         Statement of Financial Accounting Standards ("SFAS") No. 121,
         "Accounting for the Impairment of Long-Lived Assets and for
         Long-Lived Assets to Be Disposed Of", which requires impairment
         losses to be recognized for long-lived assets used in operations
         when indicators of impairment are present and the undiscounted
         cash flows are not sufficient to recover the asset's carrying
         amount. The impairment loss is measured by comparing the fair
         value of the asset to its carrying amount. The adoption of the
         SFAS had no effect on the Partnership's financial statements.

         Cash and Cash Equivalents

         The Partnership considers all highly liquid investments with an
         original maturity of three months or less at the time of
         purchase to be cash equivalents.

         Depreciation

         The Operating Partnership provides for depreciation of its
         depreciable assets using the straight-line method over their
         estimated useful lives of 14 to 30 years for building and
         improvements and five to eight years for furnishings. Tenant
         improvements are depreciated by the straight-line method over

         the life of the respective tenant's lease. Depreciation expense
         for the years ended December 31, 1996, 1995 and 1994 was
         $9,969,000, $11,598,000 and $11,873,000, respectively.

                                    F - 10

<PAGE>
                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Deferred Rent Receivable

         The Operating Partnership records rental revenue on a
         straight-line basis over the noncancellable term of the lease
         irrespective of the actual payment terms. The difference is
         classified as deferred rent receivable on the accompanying
         consolidated balance sheets.

         Deferred Costs

         Financing costs and leasing costs are capitalized and amortized
         using the straight-line method over the term of the related
         agreements. Financing costs are amortized as interest expense.

         Deferred costs at December 31 are as follows (in thousands):

         Category                           1996             1995
         --------                           ----             ----

         Financing costs                 $  5,252         $  6,340
         Leasing costs                     21,361           21,355
                                         --------         --------
                                           26,613           27,695
                                 
         Less: accumulated amortization   (21,786)         (21,435)
                                         --------         --------
                                         $  4,827         $  6,260
                                         ========         ========

         Income Taxes

         Taxable income or loss of the Partnership is reported in the
         income tax returns of its partners. Accordingly, no provision
         for income taxes is made in the consolidated financial
         statements of the Partnership.

         Restricted Cash

         Restricted cash consists primarily of amounts restricted
         pursuant to debt agreements. The balance of restricted cash is

         comprised of tenant security deposits, deposits with utility
         companies and real estate tax escrow accounts.

                                    F - 11

<PAGE>

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Disclosures About the Fair Value of Financial Instruments

         In 1995, the Partnership adopted SFAS No. 107 "Disclosures About
         the Fair Value of Financial Instruments", which requires that
         disclosure be made of estimates of the fair value of each class
         of financial instrument. Financial instruments held by the
         Partnership as of December 31, 1996, consist primarily of cash
         and cash equivalents, short-term trade receivables and payables,
         for which the carrying amounts approximate fair values due to
         the short-term maturity of these instruments, and mortgage notes
         payable. Due to the reduced value of the Partnership's real
         estate properties, which is the security for these mortgages and
         the uncertainty of obtaining replacement financing, it is not
         practicable to estimate the fair value of such debts.

         Reclassifications

         Certain amounts from 1995 and 1994 have been reclassified to conform 
         to the 1996 presentation.

         Partnership Allocations

         The net operating profits and losses and distributions of cash
         flow, as defined in the Partnership agreement, of the Investor
         Partnership, with the exception of the depreciation deductions,
         which are allocated solely to the limited partners of the
         Investor Partnership, are, in general, allocated as follows:

         Partner                                             Percentage
         -------                                             ----------
         Investor Limited Partners                             94.000%
         Winthrop Interim Partners I, A Limited 
           Partnership ("WIPI")                                 5.200%
         Linnaeus Lexington Associates Limited Partnership 
           ("Linnaeus Lexington")                                .752%
         Two Winthrop Properties, Inc. ("Two Winthrop")          .048%

         Any gains (losses) resulting from sales, dispositions or
         refinancings of any of the properties are to be allocated first
         to the Partners having negative (positive) capital account

         balances, in proportion to and to the extent of such negative
         (positive) balances, and thereafter according to the various
         provisions of the Partnership agreement. Due to this provision,
         $3,717,000 of the gain arising from the foreclosure of the
         Partnership's 227 East 45th Street property, was allocated to
         the General Partners. No cash distributions to the Partners have
         been made as a result of these allocations.

         In connection with a related party debt modification (the
         "Related Party Debt") in 1996, the General Partners and certain
         of their affiliates contributed $37,162,000 to the Operating
         Partnership. In 1994, the General Partners contributed loan
         balances totaling $10,000,000, plus interest accrued thereon of
         $743,000. These transactions have been treated as capital
         contributions by the General Partners.

                                    F - 12

<PAGE>

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 3 - MORTGAGE NOTES PAYABLE

         (a) Dime Mortgage Loans

         The Dime Savings Bank loans (the "Dime Loan(s)") are secured by
         the Partnerships' 300 Park Avenue South and 509 Fifth Avenue
         properties. In 1992, the maturity date and payment terms with
         respect to the mortgage encumbering 300 Park Avenue South were
         modified. 

         The interest rate of 9.5% and pay rate of interest only plus
         amortization payments (based on a 30-year amortization) were reduced 
         as follows:

             Period                Interest Rate             Pay Rate
             ------                -------------             --------
         5/01/92-12/31/92               0%                      0%
         1/01/93-12/31/95               8%                      6%
         1/01/96-12/31/97               8%                      8%
   
         The percentage shown are based on the $11,882,000 loan balance and the
         difference between the pay rate and the interest rate is deferred 
         without interest. Due to the extension of the maturity date and the 
         deferral of principal and certain interest payments, this 
         restructuring constituted a troubled debt restructuring, as defined 
         in Statement of Financial Accounting Standards No. 15, Accounting by 
         Debtors and Creditors for Troubled Debt Restructurings ("SFAS 15"). 
         Interest expense in the accompanying consolidated financial 
         statements is computed using the effective interest method. The 

         resulting effective interest rate was 6.15% per annum as of December 
         31, 1996 and 1995. As of December 31, 1996 and 1995, accrued and 
         unpaid interest related to the Dime Loan with respect to 300 Park 
         Avenue South, calculated in accordance with SFAS 15, was $903,000 and
         $1,063,000, respectively. Reserves totaling $1,625,000 were
         established upon restructuring. Through December 31, 1995, these
         reserves could be used to fund capital improvements, tenant 
         improvements and leasing commissions to the extent net income after 
         debt service was insufficient. As of December 31, 1995, all of these 
         reserves had been spent.

         (b) Fuji Mortgage Notes

         The Fuji Bank, Ltd. Loan ("Fuji Loan" or "Fuji") with an outstanding 
         loan balance of $207,000,000, and secured by the Partnerships" 757 
         Third Avenue, 535 Fifth Avenue, 545 Fifth Avenue, and 1372 Broadway 
         properties ("Fuji Properties") was restructured on September 30, 1992. 
         The interest rate through January 17, 1997 was to remain at 9.69% and
         was to adjust monthly thereafter at LIBOR plus .63%. The pay rates 
         were reduced to equal (as a percentage of $207,000,000) 6.5% from 
         January 1, 1992 through December 31, 1997, 7.5% from January 1, 1998 
         through December 31, 1999 and 8.25% from January 1, 2000 through 
         January 17, 2001, the new maturity date. Due to the extension of the
         maturity date and the deferral of certain interest amounts, this
         restructuring constituted a troubled debt restructuring as
         defined by SFAS 15. In accordance with SFAS 15, interest expense
         was computed using the effective interest rate method. The
         resulting effective interest rate was approximately 7.0% and
         6.5% per annum in 1995 and 1994, respectively. At February 28,
         1996 and December 31, 1995, accrued and unpaid interest related
         to the Fuji Loan, calculated in accordance with SFAS 15, was
         $27,300,000 and $26,866,000, respectively. Reserves, totaling in excess
         of $24,800,000 were established upon restructuring, of which 
         $4,935,000 was remaining and included in restricted cash at December 
         31, 1995.

         On February 28, 1996, the Fuji Loan was sold to an affiliate of
         the General Partner (see Note 4). In connection with the sale of
         the Fuji Loan, the Related Party Debt was modified (see Note 6).

         (c) Sanwa Mortgage Notes

         The Operating Partnership had two non-recourse loans from Sanwa 
         Business Credit Corporation ("Sanwa"). The Sanwa loans had been
         restructured in 1992. The interest rate on the restructured Sanwa 
         loans was to equal the prime rate plus 2%, effective September 1, 1991.
         The pay rates required equaled 0% for the period from September 1, 
         1991 through August 31, 1992; 7% from September 1, 1992 through 
         August 31, 1995; 8% from September 1, 1995 through August 31, 1998; 
         and 9% from September 1, 1998 through December 31, 2001. The 
         difference between the pay rate and the interest rate was deferred
         without interest. Interest expense in the accompanying consolidated 
         financial statements for 1995 was computed using the effective 
         interest method. The resulting effective interest rate was 

         approximately 2.5% per annum in 1995. The Operating Partnership had 
         contributed a total of $2,000,000 into a capital reserve fund, which 
         was supplemented by cash flows operations. The balance of the capital
         reserve fund held by Sanwa was $1,920,000 at December 31, 1995. In 
         January 1996, a deed in lieu of foreclosure agreement was reached 
         between the Operating Partnership and Sanwa (see Note 5).

                                    F - 13

<PAGE>
                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 3 - MORTGAGE NOTES PAYABLE (Continued)

         The following is a summary of the Mortgage Notes and the amounts
         outstanding as of December 31 (in thousands):

                                                     December 31,   December 31,
                                                        1996           1995
                                                     ------------   ------------

         DimeLoan - 300 Park Avenue South 
           First mortgage note. Modification calls 
           for an 8% interest rate. Interest 
           payments were made at a rate of 6% of the 
           outstanding principal through December, 
           1995. As of January, 1996, the pay rate 
           increased to 8% and will continue 
           until the maturity date at December 
           31, 1997. Unpaid principal balance is 
           due, in full, on December 31, 1997.        $11,882         $ 11,882

         DimeLoan - 509 Fifth Avenue 
           9.375% fixed rate first mortgage note 
           paid monthly in arrears. The principal 
           balance is amortized based on a 
           25-year period. 
           The unpaid principal balance is due, 
           in full, on August 24, 1997.                 7,289            7,390

         Fuji Properties

           First mortgage note. Restructuring
           called for an 9.69% interest rate.  
           Interest payments were to be made at 
           a rate of 6.5%                                 -            207,000

         Sanwa Mortgage Notes
 
           Loans collateralized by first and 
           second mortgages on 227 East 45th 

           Street and a second mortgage on 
           509 Fifth Avenue.                              -             24,409
                                                      -------         --------
                                                      $19,171         $250,681
                                                      =======         ========

                                         F - 14

<PAGE>
                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 3 - MORTGAGE NOTES PAYABLE (Continued)

         The General Partner is currently negotiating to refinance or
         extend the maturity dates of the Dime Loans. The Partnership has
         mortgage principal payments totaling $19,171,000, all which are
         due in 1997.

NOTE 4 - MORTGAGE NOTES PAYABLE TO AFFILIATES

         The Managing General Partner and Fuji both recognized that the 
         Partnership would not be able to comply with the terms of the Fuji 
         Loan and the Fuji Loan would go into default in early 1996. On 
         December 31, 1995, the loan had a principal balance of $207,000,000, 
         plus accrued interest of $26,866,000 (calculated utilizing the 
         effective interest method). A venture comprised of Apollo Real Estate
         Advisors, L.P. ("Apollo"), an affiliate of the General Partners, and 
         Emmes Ventures, Inc. ("Emmes") submitted a proposal to purchase the
         Fuji loan. Zeus Property LLC ("Zeus"), a newly-organized limited
         liability company owned by affiliates of Apollo and Emmes,
         purchased the loan from Fuji for $115 million on February 28,
         1996.

         Under the terms of the modified Fuji Loan (the "Modified Loan"),
         the Operating Partnership obtained a reduction in the current
         interest required to be paid under the Modified Loan which,
         based on current projections, will greatly reduce the likelihood
         of monetary default under the loan prior to February 28, 1998,
         the new maturity date for a component of the modification. As
         part of the restructuring of the Fuji loan, each of the Fuji
         Properties was conveyed by the Operating Partnership to
         newly-created limited liability companies which are
         wholly-owned, indirectly, by the Operating Partnership and its
         partners.

         The Modified Loan is comprised of several component non-recourse
         loans, all held by Zeus and its affiliates. The senior component
         consists of a series of secured notes in the aggregate principal
         amount of $102,721,000 at December 31, 1996. These notes have an
         annual interest rate of 295 basis points over 30-day LIBOR
         (8.33% at December 31, 1996), maturing on February 28, 1998

         unless extended at Zeus' option (the "Secured A Notes").

         A junior component consists of secured notes in the aggregate
         principal amount of $102,450,000 at December 31, 1996. These
         notes have a fixed annual interest rate of 14% for the next
         three years and then 16.75% thereafter, maturing on February 28,
         2016 (the "Secured B Notes"). A mandatory prepayment of $25
         million against the Secured B Notes is required to be made on
         March 15, 1998.

         The Secured A Notes and Secured B Notes are collectively
         secured by first mortgages on the Fuji Properties.

                                    F - 15
<PAGE>
                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 4 - MORTGAGE NOTES PAYABLE TO AFFILIATES (Continued)

         The following is a summary of the scheduled principal maturities
         by year under the Modified Loan (in thousands):

                            Year             Amount
                            ----             ------

                            1997            $   -
                            1998             127,721
                            1999                -
                            2000                -
                            2001                -
                            Thereafter        77,450
                                            --------
                                            $205,171
                                            ========

         A third component of the Modified Loan is an unsecured
         note (the "Unsecured Note") representing the additional 
         financing expected to be drawn upon by the Operating
         Partnership to fund capital improvements and tenant lease-up
         costs with respect to the Fuji Properties. However, any
         borrowings under this credit line are subject to Zeus'
         discretion. Accordingly, it is possible that the Operating
         Partnership may not be able to borrow against this credit line
         each time it deems it necessary. As of December 31, 1996, the
         outstanding balance against the Unsecured Note was $2,892,000,
         and is included in accounts payable, notes and loans payable and
         accrued interest to general partners and affiliates. The
         Unsecured Note bears interest at a fixed annual rate of 14% for
         the next three years and then 16.75% thereafter and matures on
         February 28, 1998, unless extended at Zeus' option.


         Interest expense incurred during 1996, relating to the Modified
         Loan was $19,659,000.

         The principal benefit of the Modified Loan to the Partnership is
         a substantial reduction in current debt service requirements
         through February 1998. The only current debt service payments
         that are required to be made under the Modified Loan for this
         two-year period are the interest payments on the Secured A
         Notes. Interest on all other components of the Modified Loan are
         payable to the extent of available cash flow from the Fuji
         Properties, and otherwise, accrue until sufficient cash flow is
         available for payment. As a result of this modification, the
         likelihood of a monetary default has been deferred from 1996 to
         1998.

         In connection with the Modified Loan, loans in the form of cash
         advances and deferred fees that were made to the Partnership by
         Affiliates of the General Partner were restructured.

                                    F - 16

<PAGE>
                  1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 5 - DEED IN LIEU OF FORECLOSURE

         In January 1996 a deed in lieu of foreclosure agreement was
         reached between the Operating Partnership and Sanwa. Pursuant to
         the deed in lieu of foreclosure agreement, the Operating
         Partnership transferred title to the property located at 227
         East 45th Street to Sanwa on January 24, 1996. In exchange,
         Sanwa released, as of the closing date, the Operating
         Partnership from all claims, demands, liabilities, obligations,
         actions and causes of any kind with regard to Sanwa.

         As of December 31, 1995, the related indebtedness to Sanwa was
         $24,409,000. As a result of the above described transactions,
         the Operating Partnership has recognized an extraordinary gain
         on extinguishment of debt of $14,419,000 in 1996. The property
         was stated at its fair value at December 31, 1995 as a result of
         a recorded write-down (see Note 7).

NOTE 6 - CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES

         The General Partners of the Investor Partnership are Linnaeus
         Lexington, Two Winthrop and WIPI. Two Winthrop, the Managing
         General Partner of the Investor Partnership is wholly owned by
         First Winthrop Corporation ("First Winthrop") which in turn is
         wholly owned by Winthrop Financial Associates ("WFA"). The
         General Partners, who are all affiliates of WFA, own the
         remaining 6% interest in the profits and losses of the Investor

         Partnership. Additionally, WFA, First Winthrop and a subsidiary,
         WFC Realty Co., Inc. ("WFC Realty"), collectively own a 1%
         interest in the profits and losses of the Operating Partnership.

         WIPI is a public real estate limited partnership whose general
         partners are Two Winthrop and a limited partnership, some of
         whose partners are affiliates of WFA. Linnaeus Lexington, the
         other General Partner, is a limited partnership, some of whose
         partners are affiliates of WFA. WFA and its affiliates manage or
         advise a large number of partnerships organized to own or
         operate real estate as well as other investments, or to invest
         in other limited partnerships that own or operate real estate or
         other investments. An affiliate of Apollo acquired control of
         the general partner of WFA in July 1995. As a result, Apollo and
         its affiliates control the Partnerships.

         The following table sets forth the amount of fees, commissions
         and other costs which the Partnerships paid or accrued to the
         General Partners and their affiliates for the years ended
         December 31, 1996, 1995 and 1994 (in thousands):

              Type of Compensation              1996       1995       1994
              --------------------              ----       ----       ----

              Asset Management Fee             $  -       $1,377     $1,377
                      
              Property Management Fees          329        1,185      1,167

              Leasing Commissions                63          476        548
              (capitalized as deferred costs)   

                                    F - 17

<PAGE>
                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 6 - CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES (Continued)
------   -----------------------------------------------------------------------
           Type of Compensation                       1996    1995    1994
           --------------------                       ----    ----    ----

           Cleaning Fees and Security Fees              -     220     501

           Construction Supervision Fee                72     609     406
           (capitalized to the costs of Buildings
           and Improvements)

           As part of the sale of the Fuji Loan, the Partnership agreed to
           retain new management and leasing agents for all of its properties.

           WFA was entitled to nonrecurring fees for organizing the

           Investor Partnership, providing services for tax consultation,
           and acquisition and financing of the Properties. The total fees
           for these services were $44,911,000, of which $9,020,000 was
           outstanding at February 28, 1996 and December 31, 1995.

           The Partnerships accrue interest on any unpaid fees or advances
           due to First Winthrop and its affiliates at an interest rate of
           prime plus .75%. The total interest incurred during 1996, 1995
           and 1994 was $694,000, $3,765,000 and $2,865,000, respectively.

           In connection with the sale of the Fuji Loan, WFA and certain of
           its affiliates entered into an agreement with the Investor
           Partnership, the Operating Partnership and an affiliate of Zeus
           with regard to amounts owed to WFA and its affiliates by the
           Partnerships (the "Winthrop Debt Agreement"). Prior to this
           agreement, WFA and its affiliates were owed, in the aggregate,
           $47,162,000 by the Partnerships. This amount is comprised of
           cash advances made by WFA to the Operating Partnership, as well
           as unpaid deferred fees related to the on-site management of the
           properties, asset management and syndication. This amount also
           includes accrued interest on these outstanding balances.

           Under the Winthrop Debt Agreement, WFA and its affiliates
           contributed $37,162,000 of the $47,162,000 to the Operating
           Partnership. The remaining $10,000,000 receivable has been
           evidenced by a promissory note issued by the Operating
           Partnership (the "Receivables Note") which is secured by a
           pledge of excess cash flow from 509 Fifth Avenue and 300 Park
           Avenue South and is payable only from those properties. WFA then
           sold the Receivables Note to an affiliate of Zeus for a payment
           of $6 million in cash. The Receivables Note has an annual base
           interest rate of 6% and an additional annual contingent interest
           rate of 9%. Interest is payable only from available cash flow
           after payment of debt service on the Dime Loans. Interest, to
           the extent that it cannot be paid currently, accrues until the
           maturity of this Note on July 31, 1997. Interest expense
           incurred during 1996, relating to the Receivables Note was
           $1,279,000.

                                    F - 18

<PAGE>
                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 7 - IMPAIRMENT OF VALUE OF REAL ESTATE

         During 1995, Management determined that the Properties suffered
         an impairment in value which was considered to be other than
         temporary. Management's assessment of impairment was primarily
         related to the continued weak New York City commercial real
         estate market. As a result, the Partnership wrote down its

         investment in the Properties by $22,500,000 in 1995. As a result
         of the transfer of the Partnership's 227 East 45th Street
         property during 1996, the remaining impairment of value of real
         estate is $20,523,000, and is allocated $11,124,000 to 757 Third
         Avenue, $5,664,000 to 535 Fifth Avenue and $3,735,000 to 545
         Fifth Avenue.

NOTE 8 - COMMITMENTS AND CONTINGENCIES

         (a)   The Operating Partnership leases the properties to tenants
               under a variety of terms, including escalation provisions,
               renewal options and obligations of the tenants to
               reimburse operating expenses.

         The aggregate future minimum fixed lease payments receivable
         under noncancellable leases at December 31, 1996 are as follows
         (in thousands):

                   Year                    Amount
                   ----                    ------

                   1997                   $ 31,087
                   1998                     27,841
                   1999                     25,706
                   2000                     23,060
                   2001                     21,338
                   Thereafter               99,614
                                          --------
                                          $228,646
                                          ========

         (b)   Deferred Purchase Price Obligations

               As part of the original purchase price of the Properties,
               the Operating Partnership agreed to make deferred purchase
               price payments to the seller in future years, with respect
               to each Property, equal to 6% of the gross proceeds of
               certain refinancings, sales or transfers of the Property,
               or, if a Property has not been sold or deemed disposed of
               by January 18, 2006, the Operating Partnership must pay
               the seller on that date an amount equal to the excess of
               (i) 6% of the appraised fair market value of such Property
               as encumbered by all liens, charges and other encumbrances
               on such Property except mortgage loans or any other
               mortgage encumbering such Property, over (ii) the amount
               of any deferred purchase price payments previously made
               with respect to such Property.

                                    F - 19
<PAGE>

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                 YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

NOTE 8 - COMMITMENTS AND CONTINGENCIES (Continued)

         (b)   Deferred Purchase Price Obligations

               At the Acquisition Date, the Operating Partnership recorded a
               liability to the seller of $25,296,000, representing the
               Operating Partnership's estimate of the amount due based on the
               original purchase price of the Properties. The total liability
               has been reduced to $1,498,000 due to sales and transfers of
               various properties and management's estimate of fair market
               value. No payments were required as a result of the Operating
               Partnership transferring its 227 East 45th Street property to
               Sanwa in satisfaction of all obligations under certain financing
               arrangements.

         (c)   Litigation

               The Operating Partnership has been named as a defendant in
               various lawsuits. These actions are at varying stages within the
               legal process, and the Operating Partnership has counterclaimed
               on certain of the actions. The Partnership's management expects
               that the outcome of these actions will not have a material
               adverse impact on the accompanying consolidated financial
               statements.

               On December 5, 1994 the Partnership, First Winthrop and other
               affiliates settled a breach of contract case whereby the
               Partnership paid the plaintiff, Pritchard Services, Inc. $750,000
               in exchange for a general release of the defendants from all
               claims by the plaintiff.

NOTE 9 - RECONCILIATION TO INCOME TAX METHOD OF ACCOUNTING

         The differences between the accrual method of accounting for
         income tax reporting and the accrual method of accounting used in
         the consolidated financial statements are as follows (in
         thousands):

                                                   1996      1995       1994
                                                   ----      ----       ----

         Net loss - financial statements         $(4,709)  $(39,208)  $(13,631)

         Differences resulted from:
           Depreciation                           (2,785)    (1,891)    (1,497)
           Rent concessions                       (2,003)    (2,693)    (2,086)
           Rental revenues                         2,000      1,512        490
           Loss due to permanent impairment            -     22,500          -
           Amortization                             (603)       152         55
           Mortgage recording taxes                  352         94         93
           Bad debt expense                          334       (684)       413
           Interest expense                        7,194      1,791     (1,582)

           Discharge of indebtedness income            -          -      9,900
           Gain on disposal                        1,107          -          -
           Other timing differences                1,021        368        321
                                                 -------   --------   --------
         Net income (loss) - income tax method   $ 1,908   $(18,059)  $ (7,524)
                                                 =======   ========   ========

     The Partnership's  taxable income (loss) per unit of limited partnership 
     interest for 1996, 1995 and 1994 was $678, $(12,551) and $(5,871), 
     respectively.
     
                                    F - 20
<PAGE>

                                 Schedule III

                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                   Real Estate and Accumulated Depreciation
                              December 31, 1996
                                (In Thousands)

<TABLE>
<CAPTION>

                                      January 1984
                                     Acquisition Costs                                                  Costs Capitalized/(Deducted)
                                    Real Estate Assets              Mortgage                             Subsequent to Acquisition
                                    ---------------------           Discount                            ---------------------------
                                              Buildings             Allocation                                         Buildings
                                                 and         ------------------------                                     and
Description        Encumbrances     Land     Improvements      Land      Bldgs & Imp.       Total       Land          Improvements
----------         ------------     ----     ------------     ------     ------------       -----       ----         --------------
<S>                <C>            <C>         <C>            <C>          <C>            <C>           <C>             <C> 

757 Third Avenue    $  78,106     $ 11,934     $  66,872     $  (125)     $   (397)      $  78,284     $ 130           $ 24,395

535 Fifth Avenue       32,271        6,034        29,991        (300)       (1,222)         34,503       (10)            16,953

545 Fifth Avenue       16,135        3,152        18,013        (331)       (1,351)         19,483        (5)            15,027

1372 Broadway          78,659        4,385        34,343        (155)         (491)         38,082        68             29,496

509 Fifth Avenue        7,289          900         4,053         (88)         (351)          4,514        (1)               216

300 Park Avenue        11,882        1,982        14,230         (46)         (145)         16,021        (5)             9,307
                    ---------     --------     ---------    ---------     ---------      ---------     -----           --------
TOTAL               $ 224,342     $ 28,387     $ 167,502    $ (1,045)     $ (3,957)      $ 190,887     $ 177           $ 95,394
                    =========     ========     =========    =========     =========      =========     =====           ========


<CAPTION>
                                                                                                                  Life
                                  Gross Balances @ 12/31/96(1)                                                   on which

                     ------------------------------------------------------                                    Depreciation
                                                  Impairments                                                  is computed
                                   Buildings        to Land                                        Date         in latest
                                       and             &                         Accumulated        of         statement of
Description          Land          Improvements     Building      Total(2)       Depreciation     Constr.       operations
----------------    ---------      -------------    ---------     ---------      -------------   ----------   ---------------  
<S>                 <C>            <C>             <C>            <C>            <C>              <C>         <C>

757 Third Avenue     $ 11,939       $  90,870      $ (11,124)     $  91,685        $  44,361        1963        5 - 30 Years

535 Fifth Avenue        5,724          45,722         (5,664)        45,782           21,598        1926        5 - 30 Years       

545 Fifth Avenue        2,816          31,689         (3,735)        30,770           12,748        1900        5 - 30 Years

1372 Broadway           4,298          63,348              -         67,646           36,619        1914        5 - 30 Years

509 Fifth Avenue          811           3,918              -          4,729            2,940        1915        5 - 30 Years

300 Park Avenue         1,931          23,392              -         25,323           12,351        1920        5 - 30 Years
                     --------       ---------      ---------      ---------        ---------
TOTAL                $ 27,519       $ 258,939      $ (20,523)     $ 265,935        $ 130,617
                     ========       =========      ==========     =========        =========      


</TABLE>

                                 F-21
<PAGE>


                                                                  SCHEDULE III


                 1626 NEW YORK ASSOCIATES LIMITED PARTNERSHIP

                   REAL ESTATE AND ACCUMULATED DEPRECIATION
                              DECEMBER 31, 1996
                                (In Thousands)

NOTES:

(1)  The aggregate cost federal income tax purpose is $286,894.

(2)  Balance, January 1, 1994                                     $277,358
     Improvements capitalized subsequent to acquisition             12,153
                                                                  --------

     Balance, December 31, 1994                                    289,511
     Improvements capitalized subsequent to acquisition              7,746
     Impairment of value                                           (22,500)
                                                                  -------- 

     Balance, December 31, 1995                                    274,757
     Improvements capitalized subsequent to acquisition              7,549

     Cost of rental property disposed of                           (18,348)
     Impairment of value of property disposed of                     1,977
                                                                  --------

     Balance, December 31, 1996                                   $265,935
                                                                  ========

(3)  Balance, January 1, 1994                                     $105,549
     Additions charged to expense                                   11,873
                                                                  --------

     Balance, December 31, 1994                                    117,422
     Additions charged to expense                                   11,598
                                                                  --------
     Balance, December 31, 1995                                    129,020
     Additions charged to expense                                    9,969
     Accumulated depreciation of rental property disposed of        (8,372)
                                                                  --------

     Balance, December 31, 1996                                   $130,617
                                                                  ========

<PAGE>
Item 9. Changes in and Disagreements on Accounting and  Financial Disclosure.

     Effective September 19, 1996, the Partnership dismissed its  prior
Independent Auditors, Arthur Andersen LLP ("Arthur  Andersen") and retained as
its new Independent Auditors, Imowitz  Koenig & Co., LLP ("Imowitz Koenig"). 
Arthur Andersen's  Independent Auditors' Report on the Partnership financial 
statements for calendar year ended December 31, 1995, did not  contain an
adverse opinion or a disclaimer of opinion, and were  not qualified or modified
as to uncertainty, audit scope or  accounting principles.  The decision to
change Independent  Auditors was approved by the Partnership managing general 
partner"s directors.  During calendar year ended 1995 and through  September 19,
1996, there were no disagreements between the  Registrant and Arthur Andersen on
any matter of accounting  principles or practices, financial statement
disclosure, or  auditing scope of procedure which disagreements if not resolved 
to the satisfaction of Arthur Andersen, would have caused it to  make reference
to the subject matter of the disagreements in  connection with its reports.

     Effective September 19, 1996, the Partnership engaged  Imowitz Koenig as
its Independent Auditors.  The Partnership did  not consult Imowitz Koenig
regarding any of the matters or events  set forth in Item 304(a)(2) of
Regulation S-K prior to September  19, 1996.
                                      23
<PAGE>


                                   PART III

 Item 10. Directors and Executive Officers of Registrant.

     The Partnership has no officers or directors.  Two Winthrop  manages and
controls substantially all of Registrant's affairs  and has general
responsibility and ultimate authority in all  matters effective its business. 
As of March 1, 1997, the names  of the directors and executive officers of Two
Winthrop and the  position held by each of them, are as follows:
 
                                                             Has Served as
                             Position Held with the          a Director or
Name                         Managing General Partner        Officer Since
----                         ------------------------        -------------
Michael L. Ashner            Chief Executive Officer             1-96
                              and Director

Richard J. McCready          President and
                             Chief Operating Officer             7-95

Jeffrey Furber               Executive Vice President            7-95
                             and Clerk

Edward Williams              Chief Financial Officer             4-96
                             Vice President and
                             Treasurer

Peter Braverman              Senior Vice President               1-96

     Michael L. Ashner, age 45, has been the Chief Executive  Officer of
Winthrop Financial Associates, A Limited Partnership  ("WFA") since January 15,
1996.  From June 1994 until January  1996, Mr. Ashner was a Director, President
and Co-chairman of  National Property Investors, Inc., a real estate investment 
company ("NPI").  Mr. Ashner was also a Director and executive  officer of NPI
Property Management Corporation ("NPI Management")  from April 1984 until
January 1996.  In addition, since 1981 Mr.  Ashner has been President of Exeter
Capital Corporation, a firm  which has organized and administered real estate
limited  partnerships.

     Richard J. McCready, age 38, is the President and Chief  Operating Officer
of WFA and its subsidiaries.  Mr. McCready  previously served as a Managing
Director, Vice President and  Clerk of WFA and a Director, Vice President and
Clerk of the  
                                      24
<PAGE>

Managing General Partner and all other subsidiaries of WFA.  Mr.  McCready
joined the Winthrop organization in 1990.
              
     Jeffrey Furber, age 37, has been the Executive Vice  President of WFA and
the President of Winthrop Management since  January 1996.  Mr. Furber served as
a Managing Director of WFA  from January 1991 to December 1995 and as a Vice
President from  June 1984 until December 1990.


     Edward V. Williams, age 56, has been the Chief Financial  Officer of WFA
since April 1996.  From June 1991 through March  1996, Mr. Williams was
Controller of NPI and NPI Management.   Prior to 1991, Mr. Williams held other
real estate related  positions including Treasurer of Johnstown American
Companies and  Senior Manager at Price Waterhouse.

     Peter Braverman, age 45, has been a Senior Vice President of  WFA since
January 1996.  From June 1995 until January 1996, Mr.  Braverman was a Vice
President of NPI and NPI Management.  From  June 1991 until March 1994, Mr.
Braverman was President of the  Braverman Group, a firm specializing in
management consulting for  the real estate and construction industries.  From
1988 to 1991,  Mr. Braverman was a Vice President and Assistant Secretary of 
Fischbach Corporation, a publicly traded, international real  estate and
construction firm.

     One or more of the above persons are also directors or  officers of a
general partner (or general partner of a general  partner) of the following
limited partnerships which either have  a class of securities registered
pursuant to Section 12(g) of the  Securities and Exchange Act of 1934, or are
subject to the  reporting requirements of Section 15(d) of such Act: Winthrop 
Partners 79 Limited Partnership; Winthrop Partners 80 Limited  Partnership;
Winthrop Partners 81 Limited Partnership; Winthrop  Residential Associates I, A
Limited Partnership; Winthrop  Residential Associates II, A Limited Partnership;
Winthrop  Residential Associates III, A Limited Partnership; 1999 Broadway 
Associates Limited Partnership; Indian River Citrus Investors  Limited
Partnership; Nantucket Island Associates Limited  Partnership; One Financial
Place Limited Partnership;  Presidential Associates I Limited Partnership;
Riverside Park  Associates Limited Partnership; Springhill Lake Investors
Limited  Partnership; Twelve AMH Associates Limited Partnership; Winthrop 
California Investors Limited Partnership; Winthrop Growth  Investors I Limited
Partnership; Winthrop Interim Partners I, A

                                      25
<PAGE>

Limited Partnership; Southeastern Income Properties Limited  Partnership;
Southeastern Income Properties II Limited  Partnership; Winthrop Miami
Associates Limited Partnership; and Winthrop Apartment Investors Limited
Partnership.

     Except as indicated above, neither the Partnership nor Two  Winthrop has
any significant employees within the meaning of Item  401(b) of Regulation S-K. 
There are no family relationships  among the officers and directors of Two
Winthrop.

     Based solely upon a review of Forms 3 and 4 and amendments  thereto
furnished to the Partnership under Rule 16a-3(e) during  the Partnership's most
recent fiscal year and Forms 5 and  amendments thereto furnished to the
Partnership with respect to  its most recent fiscal year, the Partnership is not
aware of any  director, officer or beneficial owner of more than ten percent of 
the units of limited partnership interest in the Partnership that  failed to
file on a timely basis, as disclosed in the above  Forms, reports required by
section 16(a) of the Exchange Act  during the most recent fiscal year or prior

fiscal years.

Item 11.  Executive Compensation.

     The Partnership is not required to and did not pay any  compensation to the
officers or directors of Two Winthrop.  Two  Winthrop does not presently pay any
compensation to any of its  officers or directors.  (See Item 13, "Certain
Relationships and  Related Transactions.") 

Item 12.  Security Ownership of Certain Beneficial Owners and Management.

      (a) Security Ownership of Certain Beneficial Owners.

     Two Winthrop, WIPI and Linnaeus-Lexington own all the  outstanding general
partnership interests in the Partnership.  No  other person or group is known by
the Partnership to be the  beneficial owner of more than 5% of the outstanding
partnership  interests as of December 31, 1996.

      (b) Security Ownership of Management.

     No officers, directors or partners of Linnaeus-Lexington and  First
Winthrop and none of the other officers, directors or
                                      26
<PAGE>

general partners of WIPI beneficially own any Units.  Affiliates  of First
Winthrop, however, own in the aggregate, 19 units which  represents less than
one percent of the total outstanding units.

      (c) Changes in Control.

     There exists no arrangement known to the Partnership the  operation of
which may at a subsequent date result in a change in  control of the
Partnership.

Item 13. Certain Relationships and Related Transactions.

     The General Partners and their affiliates are entitled to  receive certain
cash distributions and allocations of taxable  income or loss.  In addition, the
General Partners and their affiliates have earned various fees in connection
with the formation and operation of the Partnership and Operating Partnership. 
Further, subsequent to the offering of units, the  General Partners and their
affiliates entered into contracts to perform various services for the Operating
Partnership.

     In February 1996, certain affiliates of the General Partners  (the
"Affiliates") entered into an agreement with the Operating  Partnership, the
Partnership and an affiliate of Zeus with regard  to amounts owed to the
Affiliates by the Operating Partnership and  the Partnership (the "Winthrop Debt
Agreement").  Prior to the  entering into of this agreement, the Affiliates were
owed in the  aggregate approximately $46.6 million by the Operating Partnership 
and the Partnership.  This amount was comprised of cash advances  made to the
Partnership and the Operating Partnership in order to  fund operating deficits
and also includes accrued interest on  outstanding balances as well as unpaid

deferred fees related to  the on-site management of the properties, asset
management and  syndication.  Under the Winthrop Debt Agreement, the Affiliates 
contributed approximately $36.6 million of the $46.6 million to  the Operating
Partnership.  The remaining $10 million receivable  has been evidenced by a
promissory note (the "Receivables Note")  issued by the Operating Partnership
which is secured by a pledge  of the excess cash flow from 509 Fifth Avenue and
300 Park Avenue  South and is payable only from those properties.  Upon
receiving  consent of The Dime Savings Bank, the holder of the first mortgage 
on these properties, the Affiliate Note is to be secured by a  second mortgage
on 509 Fifth Avenue and 300 Park Avenue South.   The Receivables Note was then
sold to an affiliated of Apollo Real  Estate Advisors, L.P. ("Apollo"), an
affiliate of the Partnership,

                                      27
<PAGE>

for a payment of $6,000,000.  The Receivables Note has an annual  base interest
rate of 6% and an additional annual contingent  interest rate of 9%.  Interest
is payable only from available cash  flow after payment of debt service on the
Dime Loan.  Interest, to  the extent it cannot be paid currently, accrues until
the maturity  of the Receivables Note on July 31, 1997.

     As a result of the sale of the Receivables Note and the  purchase by Zeus
of the Fuji Loan, these loans are held by  affiliates of the Partnership.

     Prior to the consummation of the transactions contemplated  by the Winthrop
Debt Agreement, the Affiliates performed  management, cleaning, construction and
leasing services for the  properties and advanced certain amounts to the
Partnership or the  Operating Partnership to fund operating deficits and loan 
guarantees.  All of these amounts were either contributed to the  Partnership or
included in the Receivables Note.  Accordingly,  subsequent to the closing of
the transactions contemplated by the  Winthrop Debt Agreement and the sale of
the Receivables Note, the  Partnership and the Operating Partnership had no
amounts due to  the Affiliates and the property management, cleaning, leasing
and  construction services are being performed by unaffiliated third  parties.

     The following table sets forth the amounts of fees,  commissions and cash
distributions which the Partnership and the  Operating Partnership accrued for
the account of the General  Partners and their affiliates for the years ended
December 31,  1996, 1995 and 1994.  As described above, these fees have either 
been contributed to the Partnership or are evidenced by the  Receivables Note.

Receiving 
Entity           Type of Compensation       1996         1995        1994
---------        --------------------       ----         ----        ----
Winthrop         Asset Management Fee        -        $1,377,000  $1,377,000
  Management 

Winthrop         Property Management       $329,000   $1,184,662  $1,166,836
  Management

Winthrop         Leasing Commissions       $ 63,000   $  475,868  $  547,726
  Management


The Cleaning     Cleaning Fees                   --   $  220,491  $  442,938
  Force

Winthrop         Construction              $ 72,000   $  609,205  $  516,186
  Financial      Supervision Fee

                                      28
<PAGE>

     WFA was entitled to nonrecurring fees for organizing the  Operating
Partnership, providing services for tax consultation,  and acquisition and
financing of the Properties.  The total fees  for these services were
$44,911,000, of which $9,020,000 was  outstanding at February 28, 1996 and
December 31, 1995.

     The Operating Partnership accrues on any unpaid fees or  advances due to
First Winthrop and its affiliates at an interest  rate of prime plus .75%.  The
total interest incurred during  1996, 1995 and 1994 was $694,000, $3,765,000 and
$2,865,000,  respectively.

     For the years ended December 31, 1994, 1995 and 1996, the  Partnership
allocated $2,742, $2,172 and $10,478, respectively,  of taxable income (losses)
to Two Winthrop in accordance with its  interest in the Partnership.  For the
years ended December 31,  1994, 1995, and 1996 the Partnership allocated
$42,955, $34,023  and $232,300, respectively, of taxable income (losses) to 
Linnaeus-Lexington in accordance with its interest in the  Partnership.  For the
years ended December 31, 1994, 1995 and  1996, the Partnership allocated
$297,031, $235,268 and  $1,887,389, respectively, of taxable income (losses) to
WIPI in  accordance with its interest in the Partnership.

     The directors, officers and partners of First Winthrop and 
Linnaeus-Lexington and the directors, officers and general  partners of WIPI
receive no remuneration or other compensation  from the Partnership, the
Operating Partnership or the Joint  Ventures.

                                      29

<PAGE>
                                    PART IV

Item 14.  Exhibits, Financial Statements, Schedules and Reports on Form 8-K.

      (a) The following documents are filed as a part of this report:

          1.   Financial Statements - The Consolidated Financial Statements 
listed on the accompanying Index to Consolidated Financial Statements are 
filed as a part of this Annual Report.

          2.  Financial Statement Schedules - The Consolidated Financial 
Statement Schedules listed on the accompanying Index to Consolidated Financial
Statements are filed as a part of this Annual Report.

          3.  Exhibits - The Exhibits listed on the accompanying Exhibit Index
are filed as a part of this Annual Report.

      (b) Reports on Form 8-K - None

                                      30

<PAGE>

                                  SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) 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.

                                   1626 NEW YORK ASSOCIATES LIMITED
                                   PARTNERSHIP


                                   By:   TWO WINTHROP PROPERTIES, INC.
                                         Managing General Partner



                                         By: /s/   Michael L. Ashner   
                                             -----------------------
                                                   Michael Ashner
                                                   Chief Executive Officer
 
                                   Date:  March 31, 1997

     Pursuant to the requirements of the Securities Exchange Act  of 1934, this
report has been signed below by the following  persons on behalf of the
registrant and in the capacities and on  the dates indicated.

Signature/Name              Title                  Date
------------------          --------------------   --------------
/s/ Michael Ashner          Chief Executive        March 31, 1997
------------------          Officer and Director
Michael Ashner              


/s/ Edward V. Williams      Chief Financial        March 31, 1997
----------------------      Officer
Edward V. Williams          

                                      31

<PAGE>


                                EXHIBITS INDEX

         Exhibit                                                          Page
         -------                                                          ---- 
3,4      Amended and Restated Limited Partnership Agreement                  (1)
         of 1626 New York Associates Limited Partnership 
         (the "Partnership")


3(a)     Amendment to Amended and Restated Limited                           (2)
         Partnership Agreement dated August 23, 1995


10(a)    Third Amended and Restated Limited Partnership                      (3)
         Agreement of Nineteen New York Properties Limited 
         Partnership ("19 NY") dated as of September 20, 
         1990


10(b)    Commercial Brokerage Agreements between 19 NY and                   (3)
         First Winthrop Realty Co., Inc., as amended


10(c)    Commercial Management Agreements between 19 NY and                  (3)
         Winthrop Management, as amended


10(d)    Agreements for building cleaning services between                   (3)
         19 NY and Venture Services, as amended


10(e)    Pledge and Security Agreement by Winthrop Interim                   (1)
         Partners I, A Limited Partnership ("WIPI") and 
         Winthrop Financial Co., Inc. ("WFC") in favor of 
         Chemical Bank


10(f)    Investor Note Loan Agreement dated September 17,                    (1)
         1984 between the Partnership and Chemical Bank as 
         agent of The First National Bank of Boston, 
         Citibank, N.A., Bank of Montreal, Bankers Trust 
         Company and Manufacturers Hanover Trust Company


10(g)    Intercreditor Agreement dated as of September 17,                   (1)
         1984 by and between Continental Casualty Company 
         and Chemical Bank acting on behalf of itself and 
         The First National Bank of Boston, Bankers Trust 
         Company, Citibank, N.A., Bank of Montreal and 
         Manufacturers Hanover Trust Company
                                      32

<PAGE>

10(h)    Form of Investor Bond issued to the Investor                        (1)
         Partnership by Continental Casualty Company


10(i)    Restated Promissory Note, dated August 25, 1987,                    (4)
         between 19 NY and The Dime Savings Bank of New 
         York, FSB (for 300 Park Avenue South)


10(j)    Mortgage and Consolidation Agreement, dated August                  (4)
         25, 1987 between 19 NY and The Dime Savings Bank 
         of New York, FSB (for 300 Park Avenue South)


10(k)    First Modification of Mortgage Note and Mortgage,                   (5)
         dated January 20, 1993 between 19 NY and The Dime 
         Savings Bank of New York (for 300 Park Avenue South)


10(l)    Restated Promissory Note, dated August 25, 1987                     (4)
         between 19 NY and The Dime Savings Bank of New 
         York, FSB (for 509 Fifth Avenue)


10(m)    Mortgage and Consolidation Agreement dated August                   (4)
         25, 1987 between 19 NY and The Dime Savings Bank 
         of New York, FSB (for 509 Fifth Avenue)


10(n)   Mortgage made by 19 NY Limited Partnership to The                    (3)
        Fuji Bank ("Fuji") relating to a $250 million 
        Mortgage Loan on 757 Third Avenue, 410 Park 
        Avenue, 535 Fifth Avenue, 545 Fifth Avenue and 
        1372 Broadway, dated as of January 18, 1990, and 
        related Mortgage Note Consolidation, Modification 
        and Restatement Agreement


10(o)   Fuji Loan Mortgage Modification and Restatement                      (3)
        Agreement between Fuji and 19 NY, dated as of 
        September 18, 1990, and related Mortgage Note 
        Modification and Restatement Agreement, dated 
        September 18, 1990


10(p)   Second Amended and Restated Mortgage Note, Second                    (3)
        Amended and Restated Mortgage, and Renovation 
        Agreement between Fuji and 19 NY, relating to The 
        Fuji Bank Loan Restructuring, dated as of 
        September 30, 1992

                                      33

<PAGE>

10(q)   Restructuring Agreement, dated February 28, 1996                     (6)
        among Fuji, 19 NY and 535 Fifth Avenue LLC, 545 
        Fifth Avenue LLC, 757 Third Avenue LLC and 1372 
        Broadway LLC (collectively, the "LLCs"), Four New 
        York Properties Holdings LLC ("Holdings") and Zeus 
        Property LLC ("Zeus") and Westhill Equities LLC


10(r)   Debt Modification and Purchase Agreement dated                       (6)
        February 28, 1996 among 19 NY, the Partnership, 
        Isaac Asset LLC, WFC, First Winthrop Corporation, 
        Winthrop Financial Associates, A Limited 
        Partnership, Winthrop Management, The Cleaning 
        Force, A Limited Partnership and First Winthrop 
        Properties, Inc.


10(s)   Second Amended and Restated Deposit, Disbursement                    (6)
        and Security Agreement dated February 28, 1996, 
        between the LLCs and Fuji


10(t)   Splitter Note A1, dated as of February 28, 1996,                     (6)
        between Fuji and the LLCs


10(u)   Form of Splitter Note A2-A29, dated as of February                   (6)
        28, 1996, between Fuji and the LLCs


10(v)   Form of Splitter Note B1 and B2, dated as of                         (6)
        February 28, 1996, between Fuji and the LLCs


10(w)   Unsecured Promissory Note, dated as February 28,                     (6)
        1996, between Zeus and the LLCs


10(x)   Unsecured Loan Agreement, dated February 28, 1996                    (6)
        between the LLCs and Zeus.


16.     Letter dated September 19, 1996 from Arthur                          (7)
        Andersen LLP.


27.     Financial Date Schedule                                              (6)


 (1)   Incorporated by reference the Partnership's Registration  Statement on
Form 10, File No. 0-13500 as filed on April 30, 1985  and thereafter amended


(2)    Incorporated by reference to the Partnership's Current  Report on Form
8-K filed on September 6, 1995

                                      34
<PAGE>

(3)   Incorporated by reference to the Partnership's Annual Report  filed on
Form 10-K for the year ended December 31, 1991.

(4)    Incorporated by reference to the Partnership's Annual Report  filed on
Form 10-K for the year ended December 31, 1987

(5)    Incorporated by reference to the Partnership's Annual Report  filed on
Form 10-K for the year ended December 31, 1992

(6)    Incorporated by reference to the Partnership's Annual Report  filed on
Form 10-K for the year ended December 31, 1995

(7)    Incorporated by reference to the Partnership's Current  Report on Form
8-K dated September 19, 1996.

                                      35