SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C. 20549


                               FORM 10-K


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


For the fiscal year
ended December 31, 1997                Commission file no. 0-16108


                   JMB INCOME PROPERTIES, LTD. - XII
        (Exact name of registrant as specified in its charter)


         Illinois                        36-3337796
(State of organization)       (I.R.S. Employer Identification No.)


900 N. Michigan Ave., Chicago, Illinois           60611
(Address of principal executive office)         (Zip Code)


Registrant's telephone number, including area code 312-915-1987


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

                                         Name of each exchange on
Title of each class                        which registered
-------------------                -------------------------------

       None                                     None


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

                     LIMITED PARTNERSHIP INTERESTS
                    AND ASSIGNEE INTERESTS THEREIN
                           (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 [ X ]

State the aggregate market value of the voting stock held by non-affiliates
of the registrant.  Not applicable.

Documents incorporated by reference:  None



<PAGE>


                           TABLE OF CONTENTS



                                                         Page
                                                         ----
PART I

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

Item 2.      Properties . . . . . . . . . . . . . . . . .   5

Item 3.      Legal Proceedings. . . . . . . . . . . . . .   7

Item 4.      Submission of Matters to a
             Vote of Security Holders . . . . . . . . . .   7


PART II

Item 5.      Market for the Partnership's Limited
             Partnership Interests and
             Related Security Holder Matters. . . . . . .   7

Item 6.      Selected Financial Data. . . . . . . . . . .   8

Item 7.      Management's Discussion and
             Analysis of Financial Condition and
             Results of Operations. . . . . . . . . . . .  12

Item 7A.     Quantitative and Qualitative
             Disclosures About Market Risk. . . . . . . .  17

Item 8.      Financial Statements and
             Supplementary Data . . . . . . . . . . . . .  18

Item 9.      Changes in and Disagreements
             with Accountants on Accounting and
             Financial Disclosure . . . . . . . . . . . .  58


PART III

Item 10.     Directors and Executive Officers
             of the Partnership . . . . . . . . . . . . .  58

Item 11.     Executive Compensation . . . . . . . . . . .  61

Item 12.     Security Ownership of Certain
             Beneficial Owners and Management . . . . . .  62

Item 13.     Certain Relationships and
             Related Transactions . . . . . . . . . . . .  63


PART IV

Item 14.     Exhibits, Financial Statement Schedules,
             and Reports on Form 8-K. . . . . . . . . . .  63


SIGNATURES    . . . . . . . . . . . . . . . . . . . . . .  66








                                   i


<PAGE>


                                PART I


ITEM 1.  BUSINESS

     All references to "Notes" are to Notes to Consolidated Financial
Statements contained in this report.  Capitalized terms used herein, but
not defined, have the same meanings as used in the Notes.

     The registrant, JMB Income Properties, Ltd. - XII (the "Partnership"),
is a limited partnership formed in 1984 and currently governed under the
Revised Uniform Limited Partnership Act of the State of Illinois to invest
in improved income-producing commercial and residential real property.  On
August 23, 1985, the Partnership commenced an offering to the public of
$100,000,000 (subject to increase by up to $150,000,000) in Limited
Partnership Interests (the "Interests") pursuant to a Registration
Statement on Form S-11 under the Securities Act of 1933 (Registration No.
2-96716).  A total of 189,679 Interests were sold to the public at $1,000
per Interest.  The offering closed on January 17, 1986.  No Investor has
made any additional capital contribution after such date.  The Investors in
the Partnership share in their portion of the benefits of ownership of the
Partnership's real property investments according to the number of
Interests held.

     The Partnership is engaged solely in the business of the acquisition,
operation and sale and disposition of equity real estate investments.  Such
equity investments are or have been held by fee title and/or through joint
venture partnership interests.  The Partnership's real estate investments
are located throughout the nation and it has no real estate investments
located outside of the United States.  A presentation of information about
industry segments, geographic regions, raw materials, or seasonality is not
applicable and would not be material to an understanding of the
Partnership's business taken as a whole.  Pursuant to the Partnership
agreement, the Partnership is required to terminate no later than October
31, 2035.  The Partnership is self-liquidating in nature.  Upon sale of a
particular property, the net proceeds, if any, are generally distributed or
reinvested in existing properties rather than invested in acquiring
additional properties.  As discussed further in Item 7, the Partnership
currently expects to conduct an orderly liquidation of its remaining
investment portfolio as quickly as practicable and to wind up its affairs
not later than December 31, 1999, barring any unforeseen economic
developments.

     The Partnership has made the real property investments set forth in
the following table:



<PAGE>


<TABLE>
<CAPTION>
                                                     SALE OR DISPOSITION
                                                       DATE OR IF OWNED
                                                     AT DECEMBER 31, 1997,
NAME, TYPE OF PROPERTY                     DATE OF     ORIGINAL INVESTED
    AND LOCATION                SIZE      PURCHASE  CAPITAL PERCENTAGE (a)       TYPE OF OWNERSHIP
----------------------       ----------   --------  ----------------------       ---------------------
<S>                         <C>          <C>       <C>                           <C>
1. Park Center
    Financial Plaza
    office buildings
    San Jose,
    California. . . . .       408,000     06/20/85            27%                fee ownership of land and
                               sq.ft.                                            improvements (through
                               n.r.a.                                            joint venture partnership)
                                                                                 (c)(g)(i)
2. Topanga Plaza
    shopping center
    Los Angeles,
    California. . . . .       360,000     12/31/85            20%                fee ownership of land and
                               sq.ft.                                            improvements (through
                               g.l.a.                                            joint venture partnership)
                                                                                 (b)(c)(d)(e)
3. 40 Broad Street
    office building
    New York, New York.       247,800     12/31/85          12/30/97             fee ownership of land and
                               sq.ft.                                            improvements (through joint
                               n.r.a.                                            venture partnership) (c)(f)
4. Plaza Hermosa
    Shopping Center
    Hermosa Beach,
    California. . . . .        94,900     09/03/86            8%                 fee ownership of land and
                               sq.ft.                                            improvements (b)(d)(h)
                               g.l.a.
5. Mid Rivers Mall
    shopping center
    St. Peters
    (St. Louis),
    Missouri. . . . . .       323,100     12/12/86          1/30/92              fee ownership of land and
                               sq.ft.                                            improvements (through
                               g.l.a.                                            joint venture partnership)
6. First Financial
    Plaza
    office building
    Encino,
    California. . . . .       216,000     05/20/87          9/11/96              fee ownership of land and
                               sq.ft.                                            improvements (through joint
                               n.r.a.                                            venture partnership)
                                                                                 (c)(f)



<PAGE>


<FN>
---------------

     (a)   The computation of this percentage for properties held at
December 31, 1997 does not include amounts invested from sources other than
the original net proceeds of the public offering as described above and in
Item 7.

     (b)   Reference is made to the Notes and to Schedule III filed with
this annual report for the current outstanding principal balances and a
description of the long-term mortgage indebtedness secured by the
Partnership's real property investments.

     (c)   Reference is made to the Notes for a description of the joint
venture partnership through which the Partnership has made this real
property investment.

     (d)   Reference is made to Item 8 - Schedule III filed with this
annual report for further information concerning real estate taxes and
depreciation.

     (e)   Reference is made to Item 6 - Selected Financial Data for
additional operating and lease expiration data concerning this investment
property.

     (f)   The joint venture sold this property.  Reference is made to the
Notes for a further description of such sale.

     (g)   In March 1996, the joint venture sold the 190 San Fernando
building, one of the buildings in the Park Center Financial Plaza office
complex comprising approximately 5% of the total occupied space, to an
independent third party, and transferred title to one of the parking
garages to the City of San Jose.  The original capital percentage reflected
for this property in the table has not been adjusted for such transactions.

Reference is made to the Notes for a description of such transactions.

     (h)   The Partnership sold this property on January 13, 1998.
Reference is made to the Notes for a description of the sale.

     (i)   The joint venture sold the remaining buildings in the Park
Center Financial Plaza office complex on February 24, 1998.  Reference is
made to the Notes for a description of the sale.

</TABLE>


<PAGE>


     The Partnership's remaining real property investment is subject to
competition from similar types of properties (including in certain areas
properties owned by affiliates of the General Partners) in the vicinity in
which it is located.  Such competition is generally for the retention of
existing tenants.  Additionally, the Partnership is in competition for new
tenants.  Reference is made to Item 7 below for a discussion of possible
future renovation and capital improvement plans of the Partnership and its
consolidated venture.  Approximate occupancy levels for the properties
owned in 1997 are set forth in the table in Item 2 below to which reference
is hereby made.  The Partnership maintains the suitability and
competitiveness of its property in its market primarily on the basis of
tenant mix, property aesthetics, effective rents, tenant allowances and
service provided to tenants.  In the opinion of the Managing General
Partner of the Partnership, the remaining investment property is adequately
insured.  Although there is earthquake insurance coverage for a portion of
the value of the Partnership's remaining investment property, the Managing
General Partner does not believe that such coverage for its entire
replacement cost is available on economic terms.

     In January 1994, an earthquake occurred in Los Angeles, California.
The costs at Topanga for which the joint venture was responsible were
approximately $11.9 million.  The majority of this cost was recovered under
the final settlement, reached in the third quarter of 1995, with the joint
venture's earthquake insurance provider.  Additional business interruption
insurance proceeds were also received.  Reference is made to Item 7 and to
the Notes for further description of such event.

     Reference is made to the Notes for a schedule of minimum lease
payments to be received in each of the next five years, and in the
aggregate thereafter, under leases in effect at the Partnership's
properties as of December 31, 1997.

     On December 30, 1997, the Partnership, through its joint venture, sold
the 40 Broad Street office building located in New York, New York.
Reference is made to the Notes for a further description of such
transaction.

     On January 13, 1998, the Partnership sold the land and related
improvements of the Plaza Hermosa Shopping Center located in Hermosa Beach,
California.  Reference is made to the Notes for a further description of
such transaction.

     On February 24, 1998, the Partnership, through its joint venture, sold
the remaining assets in the Park Center Financial Plaza office complex
located in San Jose, California.  Reference is made to the Notes for a
further description of such transaction.

     The Partnership has no employees other than personnel performing on-
site duties at certain of the Partnership's properties, none of whom are
officers or directors of the Managing General Partner of the Partnership.

     The terms of transactions between the Partnership, the General
Partners and their affiliates are set forth in Item 11 below to which
reference is hereby made for a description of such terms and transactions.


<PAGE>


ITEM 2.  PROPERTIES

     The Partnership owns or owned directly or through joint venture
partnerships the properties or interests in the properties referred to
under Item 1 above to which reference is hereby made for a description of
said properties.

     The following is a listing of principal businesses or occupations and
approximate occupancy levels by quarter during fiscal years 1997 and 1996
for the Partnership's investment properties owned during 1997:



<PAGE>


<TABLE>
<CAPTION>
                                                             1996                      1997
                                                   ------------------------- -------------------------
                               Principal             At    At     At     At    At     At    At     At
                               Business             3/31  6/30   9/30  12/31  3/31   6/30  9/30  12/31
                               -------------        ----  ----   ----  -----  ----   ---- -----  -----
<S>                            <C>                 <C>   <C>    <C>   <C>    <C>    <C>  <C>    <C>
1.  Park Center
     Financial Plaza
     San Jose, California
     (a). . . . . . . . . . .  Accounting/
                               Telecommunications    85%   85%    87%    85%   86%    87%   87%    90%

2.  Topanga Plaza
     Shopping Center
     Los Angeles,
     California . . . . . . .  Retail                98%   94%    98%    98%   97%    98%   98%    98%

3.  40 Broad Street
     New York, New York . . .  Insurance/
                               Financial
                               Services              75%   78%    81%    74%   82%    90%   88%    N/A

4.  Plaza Hermosa
     Shopping Center
     Hermosa Beach,
     California (b) . . . . .  Retail                95%   93%    92%    91%   91%    91%   91%    91%

----------

<FN>
     Reference is made to Item 6, Item 7, and to the Notes for further information regarding property occupancy,
competitive conditions and tenant leases at the Partnership's investment properties.

     An "N/A" indicates that the property was sold and not owned by the Partnership at the end of the quarter.

     (a)  Portions of this property were sold in March 1996.  The percentages reflected in the table as of the
respective dates are compared on the basis of the remaining portion of the complex owned by the Partnership.  In
addition, the remaining portion of the property was sold in February 1998.  Reference is made to the Notes for a
more complete description of these transactions.

     (b)  This property was sold by the Partnership in January 1998 as more fully described in the Notes.

</TABLE>


<PAGE>


ITEM 3.  LEGAL PROCEEDINGS

     The Partnership is not subject to any material pending legal
proceedings.



ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters submitted to a vote of holders of Interests
during 1996 and 1997.




                                PART II

ITEM 5.  MARKET FOR THE PARTNERSHIP'S LIMITED PARTNERSHIP INTERESTS
         AND RELATED SECURITY HOLDER MATTERS

     As of December 31, 1997, there were 14,562 record holders of Interests
of the Partnership. There is no public market for Interests and it is not
anticipated that a public market for Interests will develop.  Upon request,
the Managing General Partner may provide information relating to a
prospective transfer of Interests to an investor desiring to transfer his
Interests.  The price to be paid for the Interests, as well as any economic
aspects of the transaction, will be subject to negotiation by the investor.

There are certain conditions and restrictions on the transfer of Interests,
including, among other things, the requirements that the substitution of a
transferee of Interests as a Limited Partner of the Partnership be subject
to the written consent of the Managing General Partner, which, may be
granted or withheld in its sole and absolute discretion.  The rights of a
transferee of Interests who does not become a substituted Limited Partner
will be limited to the rights to receive his share of profits or losses and
cash distributions from the Partnership, and such transferee will not be
entitled to vote such Interests or have other rights of a Limited Partner.
No transfer will be effective until the first day of the next succeeding
calendar quarter after the requisite transfer form satisfactory to the
Managing General Partner has been received by the Managing General Partner.

The transferee consequently will not be entitled to receive any cash
distributions or any allocable share of profits or losses for tax purposes
until such succeeding calendar quarter.  Profits or losses from operations
of the Partnership for a calendar year in which a transfer occurs will be
allocated between the transferor and the transferee based upon the number
of quarterly periods in which was recognized as the holder of Interests,
without regard to the results of Partnership's operations during particular
quarterly periods and without regard to whether cash distributions were
made to the transferor or transferee.  Profits or losses arising from the
sale or other disposition of Partnership properties will be allocated to
the recognized holder of the Interests as of the last day of the quarter in
which the Partnership recognized such profits or losses.  Cash
distributions to a holder of Interests arising from the sale or other
disposition of Partnership properties will be distributed to the recognized
holder of the Interests as of the last day of the quarterly period with
respect to which distribution is made.

     Reference is made to Item 6 below for a discussion of cash distribu-
tions to Investors.

    Reference is made to Item 7 for a discussion of unsolicited tender
offers received from unaffiliated third parties.


<PAGE>


<TABLE>
ITEM 6.  SELECTED FINANCIAL DATA


                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES

                          YEARS ENDED DECEMBER 31, 1997, 1996, 1995, 1994 AND 1993

                                (NOT COVERED BY INDEPENDENT AUDITORS' REPORT)


<CAPTION>
                               1997          1996           1995         1994          1993
                          ------------- -------------   -----------  ------------  ------------
<S>                      <C>           <C>            <C>           <C>           <C>
Total income, includ-
 ing gain on sale or
 disposition of
 investment property
 in 1997 and 1996 . . . .  $ 48,208,830    32,521,866    33,940,506    31,152,216    30,055,775
                           ============  ============   ===========   ===========   ===========
Earnings (loss)
 before extra-
 ordinary item. . . . . .  $ 21,259,326     5,928,741    (1,635,175)   (2,235,341)   (6,037,978)

Extraordinary items
 (net of venture
 partners' share) . . . .       393,705         --            --       (2,300,838)        --
                           ------------  ------------   -----------   -----------   -----------

Net earnings (loss) . . .  $ 21,653,031     5,928,741    (1,635,175)   (4,536,179)   (6,037,978)
                           ============  ============   ===========   ===========   ===========



<PAGE>


                               1997          1996           1995         1994          1993
                          ------------- -------------   -----------  ------------  ------------
Net earnings (loss)
 per Interest (b):
  Earnings (loss) before
    gains on sales of
    investment
    properties and
    extraordinary item. .  $      36.35         14.70         (9.15)       (12.41)       (31.79)
  Net gain on sale
    or disposition of
    investment property .         73.47         15.78         --            --            --
  Extraordinary items,
    net . . . . . . . . .          1.99         --            --           (11.65)        --
                           ------------  ------------   -----------   -----------   -----------

  Net earnings (loss)
    per Interest (b). . .  $     111.81         30.48         (9.15)       (24.06)       (31.79)
                           ============  ============   ===========   ===========   ===========

Total assets. . . . . . .  $160,776,991   138,673,945   178,508,742   189,322,387   195,051,570
Long-term debt. . . . . .  $ 63,123,525    63,630,727    88,670,160    64,470,886    87,612,869
Cash distributions
  per Interest (c). . . .  $      30.00         79.50         15.00         10.00         12.50
                           ============  ============   ===========   ===========   ===========

<FN>

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

     (a)   The above selected financial data should be read in conjunction with the consolidated financial
statements and the related notes appearing elsewhere in this annual report.

     (b)   The net earnings (loss) per Interest is based upon the number of Interests outstanding at the end of
each period (189,684).

     (c)   Cash distributions from the Partnership are generally not equal to Partnership's income (loss) for
financial reporting or Federal income tax purposes.  Each Partner's taxable income (or loss) from the Partnership
in each year is equal to his allocable share of the taxable income (loss) of the Partnership, without regard to
the cash generated or distributed by the Partnership.  Accordingly, cash distributions to the Limited Partners
since the inception of the Partnership have not resulted in taxable income to such Limited Partners and have
therefore represented a return of capital.

</TABLE>


<PAGE>


<TABLE>

SIGNIFICANT PROPERTY - SELECTED RENTAL AND OPERATING DATA AS OF DECEMBER 31, 1997


<CAPTION>

Property
--------

Topanga Plaza
Shopping Center    a)   The gross leasable area ("GLA") occupancy rate and average base rent per square foot as
of December 31 for each of the last five years were as follows:

                                                    GLA             Avg. Base Rent Per
                         December 31,          Occupancy Rate       Square Foot (1)
                         ------------          --------------       ------------------
<S>                <C>   <C>                   <C>                  <C>

                               1993 . . . . .       94%                $21.13
                               1994 . . . . .       95%                 24.84
                               1995 . . . . .       98%                 24.93
                               1996 . . . . .       98%                 28.03
                               1997 . . . . .       98%                 33.41
<FN>
                   (1) Average base rent per square foot is based on GLA occupied as of December 31
                       of each year.
</TABLE>
<TABLE>
<CAPTION>
                                                                Base Rent  Scheduled Lease Lease
                   b)     Significant Tenants      Square Feet  Per Annum  Expiration Date Renewal Option(s)
                          -------------------      -----------  ---------  --------------- -----------------
<S>                <C>    <C>                      <C>          <C>        <C>             <C>

                          None - no single tenant
                          represents more than 10%
                          of the total gross leasable
                          area at the property.

</TABLE>


<PAGE>


<TABLE>
<CAPTION>
                   c)     The following table sets forth certain information with respect to the expiration of
leases for the next ten years at the Topanga Plaza Shopping Center:

                                                                            Annualized        Percent of
                                           Number of        Approx. Total   Base Rent         Total 1997
                          Year Ending      Expiring         GLA of Expiring of Expiring       Base Rent
                          December 31,     Leases           Leases (1)      Leases            Expiring
                          ------------     ---------        --------------- -----------       ----------
<S>                <C>    <C>              <C>              <C>             <C>               <C>
                             1998               2                3,536           83,708           0.7%
                             1999               7               13,918          359,150           3.0%
                             2000              11               17,237          519,716           4.4%
                             2001               7                7,081          423,160           3.6%
                             2002              12               22,286          796,806           6.8%
                             2003              12               33,340          756,766           6.4%
                             2004              15               37,350        1,030,456           8.7%
                             2005              21               67,743        1,899,497          16.1%
                             2006              20               62,931        1,963,585          16.7%
                             2007               8               21,780          826,953           7.0%
<FN>
                   (1)       Excludes leases that expire in 1998 for which renewal leases or leases with
replacement tenants have been executed as of January 28, 1998.
</TABLE>


<PAGE>


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

     As a result of the public offering as described in Item 1, the
Partnership had approximately $171,306,000, after deducting selling
expenses and other offering costs, with which to make investments in
income-producing commercial real property, to pay legal fees and other
costs (including acquisition fees) related to such investments and for
working capital reserves.  A portion of such proceeds was utilized to
acquire the properties described in Item 1 above.

     During 1996, 1997 and early 1998, some of the Limited Partners in the
Partnership received from unaffiliated third parties unsolicited tender
offers to purchase up to 4.9% of the Interests in the Partnership at
between $150 and $475 per Interest.  The Partnership recommended against
acceptance of these offers on the basis that, among other things, the offer
prices were inadequate.  All of such offers have expired.  As of the date
of this report, the Partnership is aware that 5.79% of the Interests have
been purchased by such unaffiliated third parties either pursuant to such
tender offers or through negotiated purchases.  It is possible that other
offers for Interests may be made by unaffiliated third parties in the
future, although there is no assurance that any other third party will
commence an offer for Interests, the terms of any such offer or whether any
such offer, if made, will be consummated, amended or withdrawn.  The board
of directors of JMB Realty Corporation ("JMB") the managing general partner
of the Partnership, has established a special committee (the "Special
Committee") consisting of certain directors of JMB to deal with all matters
relating to tender offers for Interests in the Partnership, including any
and all responses to such tender offers.  The Special Committee has
retained independent counsel to advise it in connection with any potential
tender offers for Interests and has retained Lehman Brothers Inc. as
financial advisor to assist the Special Committee in evaluating and
responding to any additional potential tender offers for Interests.

     At December 31, 1997, the Partnership had consolidated cash and cash
equivalents of approximately $54,581,000, of which approximately
$16,944,000 is held by the Partnership.  The remaining $37,637,000 is held
by the Partnership's consolidated joint ventures, of which approximately
$25,505,000 represents the Partnership's share of undistributed sale
proceeds from the sale of the 40 Broad Street office building in December
1997, which were subsequently received by the Partnership in January 1998,
and cash flow from operations.  These funds are available for distributions
to partners, potential obligations related to representations and
warranties given pursuant to the sale of the 40 Broad Street office
building, tenant and capital improvements, leasing commissions, and other
expenditures, including the Partnership's share of the costs associated
with a possible expansion and mall enhancement, including a possible
purchase of the Montgomery Ward parcel, at the Topanga Plaza Shopping
Center.  The Partnership and its consolidated venture has currently
budgeted in 1998 approximately $1,088,000 for tenant improvements and other
capital expenditures, excluding the possible expansion and mall enhancement
at Topanga and purchase of the Ward store, of which the Partnership's share
is currently budgeted to be approximately $631,000.  Actual amounts
expended in 1998 may vary depending on a number of factors including actual
leasing activity, results of property operations, liquidity considerations
and other market conditions over the course of the year.  Additionally, as
more fully described in the Notes, distributions to the General Partners
have been deferred in accordance with the subordination requirements of the
partnership agreement.  The source of capital for such items and for both
short-term and long-term future liquidity and distributions is expected to
be through cash generated by the Partnership's remaining investment
properties and through the sale of such investments.  In such regard,
reference is made to the Partnership's property specific discussions below
and also to the Partnership's disclosure of certain property lease
expirations in Item 6 above.  The Partnership's and its ventures' mortgage


<PAGE>


obligations are separate non-recourse loans secured individually by the
investment properties and are not obligations of other investments.  The
Partnership and its ventures are not personally liable for the payment of
the mortgage indebtedness.

     Commencing in 1996, the Partnership changed from a quarterly
distribution of cash flow from operations to a semi-annual distribution in
May and November of each year.  In May 1997, the Partnership paid an
operating distribution of $953,162 ($5 per Interest) for the first and
second quarters of 1997 to the Limited Partners.  In November 1997, the
Partnership paid a special operating distribution of $3,812,648 ($20 per
Interest) and an operating distribution of $953,162 ($5 per Interest)
representing cash flow from operations for the third and fourth quarters of
1997.  In February 1998, the Partnership made a distribution of sale
proceeds primarily related to the sale of the 40 Broad Street office
building of $22,875,888 ($120 per Interest) to the Limited Partners.

     40 BROAD STREET

     JMB-40 Broad Street Associates ("Broad Street") had committed to a
plan to sell the property, and therefore, had classified the property as
held for sale as of July 1, 1997.  The property was no longer subject to
continued depreciation beyond such date.

     On December 30, 1997, the joint venture sold the 40 Broad Street
office building for $34,735,000 (before selling costs).  The joint venture
received approximately $33,155,000 of sale proceeds at closing, of which
the Partnership's share was approximately $22,731,000 which was
subsequently received in January 1998.  Reference is made to the Notes for
a further description of such sale.

     SAN JOSE

     During August 1994, JMB/San Jose Associates ("San Jose") received
notification from the Redevelopment Agency of the City of San Jose of its
offer to purchase one of the parking garage structures in the office
building complex, for an approved Agency project, for $4,090,000.  The
price offered was deemed by the Agency to be just compensation in
compliance with applicable laws governing eminent domain.  During 1995, the
Agency filed a condemnation action in court to proceed to obtain the garage
pursuant to such laws.  In late 1995, San Jose and the Agency reached a
mutually acceptable agreement on the transfer of the garage.  In March
1996, the sale was consummated.  Reference is made to the Notes for a
description of such sale.

     During March 1996, San Jose sold the 190 San Fernando Building and a
parking garage structure to an independent third party.  The sale price of
the building was $1,753,000 (before selling costs), paid in cash at
closing.  Reference is made to the Notes for a description of such sale.
The aggregate net sale proceeds to San Jose from both sales was
approximately $5,800,000 after selling costs and prorations, of which the
Partnership's share was approximately $2,900,000.

     Due to the proposed sales, the San Jose venture had classified the
parking garage structures and the 190 San Fernando Building as held for
sale or disposition as of January 1, 1996.  The remaining assets were
classified as held for sale as of December 31, 1996, and have, therefore,
not been subject to continued depreciation beyond such date.

     As previously reported, in 1996 San Jose completed a voluntary seismic
upgrade to the 130 Park Center Financial Plaza building and the parking
garage below the 100-130 buildings.  The cost of the structural upgrade was
approximately $860,000 (of which the Partnership's share was approximately
$430,000).



<PAGE>


     On February 24, 1998, San Jose sold the remaining assets of the Park
Center Financial Plaza office complex to an independent third party for
$76,195,000 (before selling costs).  San Jose received approximately
$49,400,000 of net sale proceeds at closing (after the repayment by San
Jose of the mortgage loans secured by the 170 Almaden, 150 Almaden and 185
Park Avenue buildings with a balance of approximately $23,300,000, loan
prepayment premiums of approximately $2,422,000 and closing costs), of
which the Partnership's share was approximately $24,700,000.  Reference is
made to the Notes for a further description of such sale.

     TOPANGA PLAZA SHOPPING CENTER

     Occupancy at the Topanga Plaza Shopping Center at December 31, 1997
was approximately 98%.  The Topanga venture had committed to a plan to sell
the property and therefore had classified the property as held for sale as
of December 31, 1996.  The property has no longer been subject to continued
depreciation beyond such date.  The Partnership is continuing its
discussion with its joint venture partner to sell its interest in the joint
venture to the joint venture partner.  There can be no assurance that any
agreement will be reached in this regard.

     PLAZA HERMOSA SHOPPING CENTER

     The property was classified as held for sale or disposition as of
December 1, 1996 and therefore was not subject to continued depreciation.
On January 13, 1998, the Partnership sold the land and related improvements
of the Plaza Hermosa Shopping Center for $13,335,000.  The Partnership
received approximately $6,400,000 of net sale proceeds at closing (after
the repayment by the Partnership of the letter of credit secured by the
property to support the underlying bond financing with a balance of
approximately $6,480,000 and closing costs).  Reference is made to the
Notes for a further description of such transaction.

     GENERAL

     There are certain risks associated with the Partnership's investments
made through joint ventures including the possibility that the
Partnership's joint venture partners in an investment might become unable
or unwilling to fulfill their financial or other obligations, or that such
joint venture partners may have economic or business interests or goals
that are inconsistent with those of the Partnership.

     The Partnership continues to conserve its working capital.  All
expenditures are carefully analyzed and certain capital projects are
deferred when appropriate.  In an effort to reduce partnership operating
expenses, the Partnership elected to make semi-annual rather than quarterly
distributions of available operating cash flow commencing with the 1996
distributions.  By conserving working capital, the Partnership will be in a
better position to meet the future needs of its remaining property since
the availability of satisfactory outside sources of capital may be limited
given the property's current debt levels.  The Partnership has held its
remaining investment property longer than originally anticipated in an
effort to maximize the return to the Limited Partners.  However, after
reviewing the remaining property and the marketplace in which it operates,
the General Partners of the Partnership expect to be able to conduct an
orderly liquidation of its remaining investment property as quickly as
practicable.  In such regard, the Partnership's remaining investment
property has been classified as held for sale as discussed above.
Therefore, the affairs of the Partnership are expected to be wound up no
later than December 31, 1999, perhaps in the 1998 timeframe, barring
unforeseen economic developments.



<PAGE>


RESULTS OF OPERATIONS

     Significant variances between periods reflected in the accompanying
consolidated financial statements not otherwise reported are primarily the
result of the sales of the First Financial Plaza office building and the 40
Broad Street office building in September 1996 and December 1997,
respectively.

     The decrease in escrow deposits at December 31, 1997 as compared to
December 31, 1996 is primarily due to the release from escrow of
approximately $300,000 in December 1997 by the letter of credit holder at
the Plaza Hermosa investment property in anticipation of the sale of the
property.

     The decrease in accounts payable at December 31, 1997 as compared to
December 31, 1996, and the related extraordinary gain for the year ended
December 31, 1997, is primarily due to the reversal of $678,801 (of which
the Partnership's share is $393,705) in accrued costs related to earthquake
damage in 1994 at the Topanga Plaza investment property, as more fully
discussed in the Notes.  The decrease is also partially due to the sale of
the 40 Broad Street office building in December 1997.

     The decrease in unearned rents at December 31, 1997 as compared to
December 31, 1996 is primarily due to the timing of rental receipts at the
Topanga Plaza investment property.

     The decrease in rental income for the year ended December 31, 1997 as
compared to the year ended December 31, 1996 and for the year ended
December 31, 1996 as compared to the year ended December 31, 1995 is
primarily due to the sale of the First Financial Plaza office building in
September 1996.  The decrease for the year ended December 31, 1997 as
compared to the year ended December 31, 1996 is partially offset by the
receipt of proceeds totaling approximately $312,000 during 1997 from The
Broadway and Nordstrom, relating to their share of prorata expenses and
costs for repairs and restorations at the Topanga Plaza Shopping Center
following the earthquake in early 1994.  The decrease in rental income for
the year ended December 31, 1996 as compared to the year ended December 31,
1995 is also partially due to the receipt of insurance proceeds of
approximately $3,200,000, in the third quarter of 1995, relating to
business interruption at the Topanga Plaza Shopping Center following the
earthquake in early 1994.  Furthermore, the decrease in rental income for
the year ended December 31, 1996 as compared to the year ended December 31,
1995 is partially offset by the receipt of proceeds totaling approximately
$513,000, in the second quarter of 1996, from Robinson-May and Montgomery
Ward, relating to their pro rata share of expenses and costs for repairs
and restorations at the Topanga Plaza Shopping Center following the
earthquake in early 1994.

     The decrease in mortgage and other interest for the year ended
December 31, 1997 as compared to the years ended December 31, 1996 and 1995
is primarily due to the sale of the First Financial Plaza office building
in September 1996 and the $4,000,000 loan paydown at the First Financial
Plaza in 1995.

     The decrease in depreciation expense for the year ended December 31,
1997 as compared to the years ended December 31, 1996 and 1995 is primarily
due to the First Financial Plaza office building being classified as held
for sale as of April 1, 1996, the Topanga Plaza and Plaza Hermosa
investment properties being identified as held for sale or disposition as
of December 31, 1996, and the 40 Broad Street investment property being
identified as held for sale or disposition as of July 1, 1997, and
therefore, no longer subject to depreciation beyond such dates.



<PAGE>


     The increase in general and administrative expenses for the year ended
December 31, 1997 as compared to the year ended December 31, 1996 is
primarily attributable to an increase in reimbursable costs to affiliates
of the General Partners in 1997.  The decrease in general and
administrative expenses for the year ended December 31, 1996 as compared to
the year ended December 31, 1995 is primarily attributable to an increase
in reimbursable costs to affiliates of the General Partners in 1995
including the recognition of certain additional prior year reimbursable
costs to such affiliates.

     The provision for value impairment for the year ended December 31,
1995 is due to the Partnership recording a provision for value impairment
of $5,500,000 at the Plaza Hermosa investment property at September 30,
1995.

     The increase in Partnership's share of operations of unconsolidated
ventures for the year ended December 31, 1997 as compared to the year ended
December 31, 1996 is primarily due to an increase in earnings of the San
Jose venture due to the San Jose properties being identified as held for
sale or disposition as of December 31, 1996, and therefore, no longer
subject to depreciation beyond such date.  The decrease in Partnership's
share of operations of unconsolidated ventures for the year ended
December 31, 1996 as compared to the year ended December 31, 1995 is
primarily due to the sale of the 190 San Fernando building and one of the
parking structures at the San Jose investment property in 1996, partially
offset by the write-off of receivables in 1995 related to a certain tenant
at the San Jose investment property.

     The Partnership's share of gain on sale of investment properties of
unconsolidated venture of $1,412,610 in 1996 relates to the sale of the 190
San Fernando building and one of the parking structures at the San Jose
investment property.

     The increase in venture partners' share of consolidated ventures'
operations before extraordinary item for the year ended December 31, 1997
as compared to the year ended December 31, 1996 is primarily due to the
Topanga Plaza and 40 Broad Street investment properties being identified as
held for sale or disposition as of December 31, 1996 and July 1, 1997,
respectively, and therefore, no longer subject to depreciation beyond such
dates.  In addition, the increase is also due to a reduction in assessed
real estate taxes for 1997 at the 40 Broad Street investment property.
However, this increase is partially offset by the sale of the First
Financial Plaza office building in September 1996.  The decrease in venture
partners' share of consolidated ventures' operations before extraordinary
item for the year ended December 31, 1996 as compared to the year ended
December 31, 1995 is primarily due to the sale of the First Financial Plaza
office building in September 1996.

     The venture partner's share of gain on sale of investment property of
$6,455,513 in 1997 is the gain on the sale of the 40 Broad Street
investment property in December 1997.  The venture partner's share of gain
on sale of investment property of $1,270,596 in 1996 is the gain on the
sale of the First Financial Plaza investment property in September 1996.



<PAGE>


INFLATION

     Due to the decrease in the level of inflation in recent years,
inflation generally has not had a material effect on rental income or
property operating expenses.

     Inflation is not expected to significantly impact future operations
due to the expected liquidation of the Partnership by 1999.  However, to
the extent that inflation in future periods would have an adverse impact on
property operating expenses, the effect would generally be offset by
amounts recovered from tenants as many of the long-term leases at the
Partnership's commercial property have escalation clauses covering
increases in the cost of operating and maintaining the property as well as
real estate taxes.  Therefore, there should be little effect from inflation
on operating earnings if the property remains substantially occupied.  In
addition, substantially all of the leases at the Partnership's shopping
center investment contain provisions which entitle the Partnership to
participate in gross receipts of tenants above fixed minimum amounts.



ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Not applicable.




<PAGE>


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA



                   JMB INCOME PROPERTIES, LTD. - XII
                        (A LIMITED PARTNERSHIP)
                       AND CONSOLIDATED VENTURES

                                 INDEX

Independent Auditors' Report
Consolidated Balance Sheets, December 31, 1997 and 1996
Consolidated Statements of Operations, years ended December 31, 1997,
  1996 and 1995
Consolidated Statements of Partners' Capital Accounts, years ended
  December 31, 1997, 1996 and 1995
Consolidated Statements of Cash Flows, years ended December 31, 1997,
  1996 and 1995
Notes to Consolidated Financial Statements

                                                          Schedule
                                                          --------

Consolidated Real Estate and Accumulated Depreciation        III

Schedules not filed:

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




                        JMB/SAN JOSE ASSOCIATES
                        (A GENERAL PARTNERSHIP)

                                 INDEX

Independent Auditors' Report
Balance Sheets, December 31, 1997 and 1996
Statements of Operations, years ended December 31, 1997, 1996 and 1995
Statements of Partners' Capital Accounts, years ended December 31, 1997,
  1996 and 1995
Statements of Cash Flows, years ended December 31, 1997, 1996 and 1995
Notes to Financial Statements.

                                                          Schedule
                                                          --------

Real Estate and Accumulated Depreciation                     III

Schedules not filed:

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





<PAGE>












                     INDEPENDENT AUDITORS' REPORT


The Partners
JMB INCOME PROPERTIES, LTD. - XII:

     We have audited the consolidated financial statements of JMB Income
Properties, Ltd. - XII (a limited partnership) and consolidated ventures as
listed in the accompanying index.  In connection with our audits of the
consolidated financial statements, we also have audited the financial
statement schedule as listed in the accompanying index.  These consolidated
financial statements and financial statement schedule are the
responsibility of the General Partners of the Partnership.  Our
responsibility is to express an opinion on these consolidated financial
statements and financial statement schedule based on our audits.

     We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles
used and significant estimates made by the General Partners of the
Partnership, 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
JMB Income Properties, Ltd. - XII and consolidated ventures at December 31,
1997 and 1996, and the results of their operations and their cash flows for
each of the years in the three-year period ended December 31, 1997, in
conformity with generally accepted accounting principles.  Also in our
opinion, the related financial statement schedule, when considered in
relation to the basic consolidated financial statements taken as a whole,
presents fairly, in all material respects, the information set forth
therein.

     As discussed in the Notes to the consolidated financial statements, in
1996, the Partnership and its consolidated ventures changed their method of
accounting for long-lived assets and long-lived assets to be disposed of to
conform with Statement of Financial Accounting Standards No. 121.







                                    KPMG PEAT MARWICK LLP



Chicago, Illinois
March 25, 1998



<PAGE>


<TABLE>
                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES

                                         CONSOLIDATED BALANCE SHEETS

                                         DECEMBER 31, 1997 AND 1996

                                                   ASSETS
                                                   ------
<CAPTION>
                                                                            1997              1996
                                                                        ------------      -----------
<S>                                                                    <C>               <C>
Current assets:
  Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . .   $ 54,580,706       22,821,808
  Rents and other receivables, net of allowance for
    doubtful accounts of $25,880 in 1997 and
    $255,866 in 1996. . . . . . . . . . . . . . . . . . . . . . . . .        217,745          774,707
  Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . .        179,879          282,111
  Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . .        878,669        1,053,916
                                                                        ------------      -----------

          Total current assets. . . . . . . . . . . . . . . . . . . .     55,856,999       24,932,542
                                                                        ------------      -----------

Investment properties - Schedule III:
  Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          --           1,765,194
  Buildings and improvements. . . . . . . . . . . . . . . . . . . . .          --          22,602,302
                                                                        ------------      -----------

                                                                               --          24,367,496
  Less accumulated depreciation . . . . . . . . . . . . . . . . . . .          --          14,873,703
                                                                        ------------      -----------

          Total properties held for investment,
            net of accumulated depreciation . . . . . . . . . . . . .          --           9,493,793

  Properties held for sale or disposition . . . . . . . . . . . . . .     91,675,837       90,811,933
                                                                        ------------      -----------

          Total investment properties . . . . . . . . . . . . . . . .     91,675,837      100,305,726

Investment in unconsolidated ventures, at equity. . . . . . . . . . .      6,353,682        4,848,158
Deferred expenses . . . . . . . . . . . . . . . . . . . . . . . . . .      5,000,125        6,491,467
Accrued rents receivable. . . . . . . . . . . . . . . . . . . . . . .      1,890,348        2,096,052
                                                                        ------------      -----------

                                                                        $160,776,991      138,673,945
                                                                        ============      ===========


<PAGE>


                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES

                                   CONSOLIDATED BALANCE SHEETS - CONTINUED


                                 LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS
                                 ------------------------------------------

                                                                            1997              1996
                                                                        ------------      -----------
Current liabilities:
  Current portion of long-term debt . . . . . . . . . . . . . . . . .   $    507,202          458,557
  Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . .        533,374        1,601,488
  Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . .        482,884          503,951
  Unearned rents. . . . . . . . . . . . . . . . . . . . . . . . . . .        272,481          595,723
                                                                        ------------      -----------
          Total current liabilities . . . . . . . . . . . . . . . . .      1,795,941        3,159,719

Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . .        147,624          200,990
Long-term debt, less current portion. . . . . . . . . . . . . . . . .     63,123,525       63,630,727
                                                                        ------------      -----------
Commitments and contingencies

          Total liabilities . . . . . . . . . . . . . . . . . . . . .     65,067,090       66,991,436

Venture partners' subordinated equity in ventures . . . . . . . . . .     25,015,702       16,922,369

Partners' capital accounts:
  General partners:
      Capital contributions . . . . . . . . . . . . . . . . . . . . .         11,123           11,123
      Cumulative net earnings . . . . . . . . . . . . . . . . . . . .      1,359,410          915,607
                                                                        ------------      -----------
                                                                           1,370,533          926,730
                                                                        ------------      -----------
  Limited partners (189,684 interests):
      Capital contributions, net of offering costs. . . . . . . . . .    171,306,452      171,306,452
      Cumulative net loss . . . . . . . . . . . . . . . . . . . . . .     (3,091,192)     (24,300,420)
      Cumulative cash distributions . . . . . . . . . . . . . . . . .    (98,891,594)     (93,172,622)
                                                                        ------------      -----------
                                                                          69,323,666       53,833,410
                                                                        ------------      -----------
          Total partners' capital accounts. . . . . . . . . . . . . .     70,694,199       54,760,140
                                                                        ------------      -----------
                                                                        $160,776,991      138,673,945
                                                                        ============      ===========

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


<PAGE>


<TABLE>
                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES

                                    CONSOLIDATED STATEMENTS OF OPERATIONS
                                YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
<CAPTION>
                                                           1997             1996            1995
                                                       ------------     ------------    ------------
<S>                                                   <C>              <C>             <C>
Income:
  Rental income . . . . . . . . . . . . . . . . . .     $26,345,595       28,415,164      32,608,714
  Interest income . . . . . . . . . . . . . . . . .       1,330,433        1,224,129       1,331,792
  Gain on sale of investment property . . . . . . .      20,532,802        2,882,573           --
                                                        -----------      -----------     -----------
                                                         48,208,830       32,521,866      33,940,506
                                                        -----------      -----------     -----------
Expenses:
  Mortgage and other interest . . . . . . . . . . .       6,108,328        7,665,413       8,991,027
  Depreciation. . . . . . . . . . . . . . . . . . .         328,493        4,625,655       5,598,646
  Property operating expenses . . . . . . . . . . .      10,106,333       12,174,612      12,602,194
  Professional services . . . . . . . . . . . . . .         280,273          307,504         333,970
  Amortization of deferred expenses . . . . . . . .       1,029,488        1,205,175       1,263,041
  General and administrative. . . . . . . . . . . .         483,878          357,395         427,735
  Provision for value impairment. . . . . . . . . .           --               --          5,500,000
                                                        -----------      -----------     -----------
                                                         18,336,793       26,335,754      34,716,613
                                                        -----------      -----------     -----------
                                                         29,872,037        6,186,112        (776,107)

Partnership's share of earnings (loss) from
  operations of unconsolidated ventures . . . . . .       1,505,524          611,483         709,164
Partnership's share of gain on sale of investment
  properties of unconsolidated venture. . . . . . .           --           1,412,610           --
Venture partners' share of consolidated ventures'
  operations before extraordinary item. . . . . . .      (3,662,722)      (1,010,868)     (1,568,232)
Venture partners' share of gain on sale of
  investment property . . . . . . . . . . . . . . .      (6,455,513)      (1,270,596)          --
                                                        -----------      -----------     -----------
          Earnings (loss) before
            extraordinary item. . . . . . . . . . .      21,259,326        5,928,741      (1,635,175)

Extraordinary item (net of venture partner's
  share of $285,096). . . . . . . . . . . . . . . .         393,705            --              --
                                                        -----------      -----------     -----------
          Net earnings (loss) . . . . . . . . . . .     $21,653,031        5,928,741      (1,635,175)
                                                        ===========      ===========     ===========


<PAGE>


                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES

                              CONSOLIDATED STATEMENTS OF OPERATIONS - CONTINUED


                                                           1997             1996            1995
                                                       ------------     ------------    ------------
Net earnings (loss) per limited partnership
 interest:
   Earnings (loss) before gain on sale of
     investment properties and extraordinary
     item . . . . . . . . . . . . . . . . . . . . .     $     36.35            14.70           (9.15)
   Gain on sale of investment properties. . . . . .           73.47            15.78           --
   Extraordinary item, net. . . . . . . . . . . . .            1.99            --              --
                                                        -----------      -----------     -----------
          Net earnings (loss) per limited
            partnership interest. . . . . . . . . .     $    111.81            30.48           (9.15)
                                                        ===========      ===========     ===========




























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


<PAGE>


<TABLE>
                                        JMB INCOME PROPERTIES, LTD. - XII
                                             (A LIMITED PARTNERSHIP)
                                            AND CONSOLIDATED VENTURES

                              CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS

                                  YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995


<CAPTION>
                                 GENERAL PARTNERS                             LIMITED PARTNERS (189,684 INTERESTS)
               --------------------------------------------------    ---------------------------------------------------
                                                                   CONTRI-
                                                                   BUTIONS
                           NET                                     NET OF        NET
              CONTRI-    EARNINGS      CASH                       OFFERING    EARNINGS      CASH
              BUTIONS     (LOSS)   DISTRIBUTIONS     TOTAL         COSTS       (LOSS)   DISTRIBUTIONS    TOTAL
              -------   ---------- -------------  -----------   -----------  ---------- ------------- -----------
<S>          <C>       <C>        <C>            <C>           <C>          <C>         <C>          <C>
Balance at
 December 31,
 1994 . . . . $11,123      669,602         --        680,725   171,306,452  (28,347,981) (75,157,860) 67,800,611

Cash distri-
 butions
 ($15 per
 limited
 partnership
 interest). .   --            --           --           --           --            --     (2,859,487) (2,859,487)
Net earnings
 (loss) . . .   --          99,593         --         99,593         --      (1,734,768)       --     (1,734,768)
              -------      -------      -------      -------   -----------  -----------  -----------  ----------
Balance at
 December 31,
 1995 . . . .  11,123      769,195         --        780,318    171,306,452 (30,082,749) (78,017,347) 63,206,356

Cash distri-
 butions
 ($79.50 per
 limited
 partnership
 interest). .    --          --            --          --            --           --     (15,155,275)(15,155,275)
Net earnings
 (loss) . . .    --        146,412         --        146,412         --       5,782,329        --      5,782,329
              -------      -------      -------      -------    ----------- -----------  -----------  ----------


<PAGE>


                                        JMB INCOME PROPERTIES, LTD. - XII
                                             (A LIMITED PARTNERSHIP)
                                            AND CONSOLIDATED VENTURES

                        CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS - CONTINUED


                                 GENERAL PARTNERS                             LIMITED PARTNERS (189,684 INTERESTS)
               --------------------------------------------------    ---------------------------------------------------
                                                                   CONTRI-
                                                                   BUTIONS
                           NET                                     NET OF        NET
              CONTRI-    EARNINGS      CASH                       OFFERING    EARNINGS      CASH
              BUTIONS     (LOSS)   DISTRIBUTIONS     TOTAL         COSTS       (LOSS)   DISTRIBUTIONS    TOTAL
              -------   ---------- -------------  -----------   -----------  ---------- ------------- -----------

Balance at
 December 31,
 1996 . . . .  11,123      915,607         --        926,730    171,306,452 (24,300,420) (93,172,622) 53,833,410

Cash distri-
 butions
 ($30 per
 limited
 partnership
 interest). .    --           --           --           --           --           --      (5,718,972) (5,718,972)
Net earnings
 (loss) . . .    --        443,803         --        443,803         --      21,209,228        --     21,209,228
              -------    ---------      -------    ---------   -----------  -----------  -----------  ----------
Balance at
 December 31,
 1997 . . . . $11,123    1,359,410         --      1,370,533   171,306,452   (3,091,192) (98,891,594) 69,323,666
              =======    =========      =======    =========   ===========  ===========  ===========  ==========















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


<PAGE>


<TABLE>
                                        JMB INCOME PROPERTIES, LTD. - XII
                                             (A LIMITED PARTNERSHIP)
                                            AND CONSOLIDATED VENTURES

                                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                  YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

<CAPTION>
                                                            1997            1996             1995
                                                        -----------      -----------     -----------
<S>                                                    <C>              <C>             <C>
Cash flows from operating activities:
  Net earnings (loss) . . . . . . . . . . . . . . .     $21,653,031        5,928,741      (1,635,175)
  Items not requiring (providing) cash or
   cash equivalents:
    Depreciation. . . . . . . . . . . . . . . . . .         328,493        4,625,655       5,598,646
    Amortization of deferred expenses . . . . . . .       1,029,488        1,205,175       1,263,041
    Partnership's share of operations of
      unconsolidated venture. . . . . . . . . . . .      (1,505,524)        (611,483)       (709,164)
    Partnership's share of gain on sale of
      investment properties of unconsolidated
      venture . . . . . . . . . . . . . . . . . . .           --          (1,412,610)          --
    Venture partners' share of
      ventures' operations, gain on sale and
      extraordinary item. . . . . . . . . . . . . .      10,403,333        2,281,464       1,568,232
    Total gain on sale of investment property . . .     (20,532,802)      (2,882,574)          --
    Provision for value impairment. . . . . . . . .           --               --          5,500,000
    Extraordinary item. . . . . . . . . . . . . . .        (678,801)           --              --
  Changes in:
    Rents and other receivables . . . . . . . . . .         556,962        1,670,049        (380,342)
    Prepaid expenses. . . . . . . . . . . . . . . .         102,232          (21,947)        (33,566)
    Escrow deposits . . . . . . . . . . . . . . . .         175,247         (153,355)       (192,229)
    Casualty insurance receivable . . . . . . . . .           --               --            853,000
    Accrued rents receivable. . . . . . . . . . . .      (1,559,728)        (289,426)       (151,292)
    Accounts payable. . . . . . . . . . . . . . . .        (389,313)        (436,529)     (1,802,619)
    Accrued interest  . . . . . . . . . . . . . . .         (21,067)          (6,671)        488,126
    Unearned rents. . . . . . . . . . . . . . . . .        (323,242)         572,414         (41,486)
    Tenant security deposits. . . . . . . . . . . .         (53,366)        (291,224)        (17,279)
                                                        -----------      -----------     -----------
          Net cash provided by (used in)
            operating activities. . . . . . . . . .       9,184,943       10,177,679      10,307,893
                                                        -----------      -----------     -----------



<PAGE>


                                        JMB INCOME PROPERTIES, LTD. - XII
                                             (A LIMITED PARTNERSHIP)
                                            AND CONSOLIDATED VENTURES

                                CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

                                                            1997            1996            1995
                                                        -----------      -----------     -----------
Cash flows from investing activities:
  Net sales and maturities (purchases)
    of short-term investments . . . . . . . . . . .           --               --         14,176,812
  Cash proceeds on sale of investment property. . .      33,154,809       12,985,931           --
  Additions to investment properties,
    net of related payables . . . . . . . . . . . .      (1,743,255)      (1,583,556)     (1,658,644)
  Partnership's distributions from
    unconsolidated ventures . . . . . . . . . . . .           --           3,588,000       1,250,000
  Partnership's contributions to
    unconsolidated ventures . . . . . . . . . . . .           --               --         (1,233,437)
  Payment of deferred expenses. . . . . . . . . . .        (350,070)        (624,372)       (577,311)
                                                        -----------      -----------     -----------
          Net cash provided by (used in)
            investing activities. . . . . . . . . .      31,061,484       14,366,003      11,957,420
                                                        -----------      -----------     -----------
Cash flows from financing activities:
  Principal payments on long-term debt. . . . . . .        (458,557)        (622,627)     (4,593,543)
  Advances from venture partners. . . . . . . . . .           --               --           (435,000)
  Venture partners' contributions to venture. . . .           --             161,356       1,580,310
  Distributions to venture partners . . . . . . . .      (2,310,000)      (7,561,880)     (2,723,400)
  Distributions to limited partners . . . . . . . .      (5,718,972)     (15,155,275)     (2,859,487)
                                                        -----------      -----------     -----------
          Net cash provided by (used in)
            financing activities. . . . . . . . . .      (8,487,529)     (23,178,426)     (9,031,120)
                                                        -----------      -----------     -----------
          Net increase (decrease) in cash
            and cash equivalents. . . . . . . . . .      31,758,898        1,365,256      13,234,193
          Cash and cash equivalents,
            beginning of year . . . . . . . . . . .      22,821,808       21,456,552       8,222,359
                                                        -----------      -----------     -----------
          Cash and cash equivalents,
            end of year . . . . . . . . . . . . . .     $54,580,706       22,821,808      21,456,552
                                                        ===========      ===========     ===========
Supplemental disclosure of cash flow information:
  Cash paid for mortgage and other interest . . . .     $ 6,129,395        7,672,084       8,502,901
                                                        ===========      ===========     ===========



<PAGE>


                                        JMB INCOME PROPERTIES, LTD. - XII
                                             (A LIMITED PARTNERSHIP)
                                            AND CONSOLIDATED VENTURES

                                CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

                                                            1997            1996            1995
                                                        -----------      -----------     -----------

Non-cash investing and financing activities:
  Total sales proceeds from sale of investment
    property, net of selling expenses . . . . . . .     $33,154,809       37,690,486           --
  Principal balance due on mortgage payable . . . .           --         (24,704,555)          --
                                                        -----------      -----------     -----------
          Cash proceeds from sale of investment
            property, net of selling expenses . . .     $33,154,809       12,985,931           --
                                                        ===========      ===========     ===========































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


<PAGE>


                   JMB INCOME PROPERTIES, LTD. - XII
                        (A LIMITED PARTNERSHIP)
                       AND CONSOLIDATED VENTURES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

             YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995




OPERATIONS AND BASIS OF ACCOUNTING

     GENERAL

     The Partnership holds (either directly or through joint ventures)
investments in real estate.  Business activities consist of rentals to a
wide variety of commercial and retail companies, and the ultimate sale or
disposition of such real estate.  The Partnership currently expects to
conduct an orderly liquidation of its remaining investment portfolio and
wind up its affairs not later than December 31, 1999, barring any
unforeseen economic developments.

     The accompanying consolidated financial statements include the
accounts of the Partnership and its majority-owned ventures, Topanga Plaza
Partnership ("Topanga"), JMB-40 Broad Street Associates ("Broad Street"),
JMB First Financial Associates ("First Financial", prior to its sale in
September 1996) and First Financial's venture (prior to its sale in
September 1996), JMB Encino Partnership, ("Encino").  The effect of all
transactions between the Partnership and its consolidated ventures have
been eliminated.  The equity method of accounting has been applied in the
accompanying consolidated financial statements with respect to the
Partnership's venture interest in JMB/San Jose Associates ("San Jose").
Accordingly, the accompanying consolidated financial statements do not
include the accounts of San Jose.

     The Partnership's records are maintained on the accrual basis of
accounting as adjusted for Federal income tax reporting purposes.  The
accompanying consolidated financial statements have been prepared from such
records after making appropriate adjustments to present the Partnership's
accounts in accordance with generally accepted accounting principles
("GAAP") and to consolidate the accounts of the ventures as described
above.  Such GAAP and consolidation adjustments are not recorded on the
records of the Partnership.  The net effect of these items for the years
ended December 31, 1997 and 1996 is summarized as follows:



<PAGE>


<TABLE>
<CAPTION>
                                                   1997                              1996
                                                  -------------------------------------------------------------
                                                         TAX BASIS                         TAX BASIS
                                       GAAP BASIS       (UNAUDITED)       GAAP BASIS      (UNAUDITED)
                                      ------------      ----------       ------------     ----------
<S>                                  <C>               <C>              <C>              <C>
Total assets. . . . . . . . . . . .   $160,776,991       89,829,763      138,673,945     103,781,808
Partners' capital accounts
  (deficits):
    General partners. . . . . . . .      1,370,533       (1,314,353)         926,730      (1,184,427)
    Limited partners. . . . . . . .     69,323,666       84,497,148       53,833,410      98,323,758
Net earnings (loss):
    General partners. . . . . . . .        443,803         (129,924)         146,412         (40,931)
    Limited partners. . . . . . . .     21,209,228       (8,107,640)       5,782,329        (276,439)
Net earnings (loss)
  per limited partnership
  interest. . . . . . . . . . . . .         111.81            42.74            30.48           (1.46)
                                       ===========      ===========      ===========     ===========
</TABLE>


<PAGE>


     The net earnings (loss) per limited partnership interest is based upon
the number of limited partnership interests outstanding at the end of each
period (189,684).

     The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those
estimates.

     Statement of Financial Accounting Standards No. 95 requires the
Partnership to present a statement which classifies receipts and payments
according to whether they stem from operating, investing or financing
activities.  The required information has been segregated and accumulated
according to the classifications specified in the pronouncement.
Partnership distributions from its unconsolidated ventures are considered
cash flow from operating activities to the extent of the Partnership's
cumulative share of net earnings.  In addition, the Partnership records
amounts held in U.S. Government obligations at cost, which approximates
market.  For the purposes of these financial statements, the Partnership's
policy is to consider all such amounts held with original maturities of
three months or less ($53,859,686 and $21,768,622 at December 31, 1997 and
1996, respectively) as cash equivalents, which includes investments in an
institutional mutual fund which holds U.S. Government obligations, with any
remaining amounts (generally with original maturities of one year or less)
reflected as short-term investments being held to maturity.

     Deferred expenses consist primarily of commitment fees and loan
related costs which are amortized over the term of the related mortgage
loans, and lease commissions which are amortized over the term of the
related leases, using the straight-line method.

     Although certain leases of the Partnership provide for tenant
occupancy during periods for which no rent is due and/or increases in the
minimum lease payments over the term of the lease, rental income is accrued
for the full period of occupancy on a straight-line basis.

     Statement of Financial Accounting Standards No. 107 ("SFAS 107"),
"Disclosures about Fair Value of Financial Instruments" (as amended),
requires certain large entities to disclose the SFAS 107 value of all
financial assets and liabilities for which it is practicable to estimate.
Value is defined in the Statement as the amount at which the instrument
could be exchanged in a current transaction between willing parties, other
than in a forced or liquidation sale.  The Partnership believes the
carrying amount of its financial instruments classified as current assets
and liabilities (excluding current portion of long-term debt) approximates
SFAS 107 value due to the relatively short maturity of these instruments.
There is no quoted market value available for any of the Partnership's
other instruments.  The debt, with a carrying balance of $63,630,727, has
been calculated to have an SFAS 107 value of $69,174,577 by discounting the
scheduled loan payments to maturity.  Due to restrictions on
transferability and prepayment and the inability to obtain comparable
financing due to current levels of debt, previously modified debt terms or
other property specific competitive conditions, the Partnership would be
unable to refinance these properties to obtain such calculated debt amounts
reported.  The Partnership has no other significant financial instruments.

     No provision for State or Federal income taxes has been made as the
liability for such taxes is that of the partners rather than the
Partnership.  However, in certain circumstances, the Partnership has been
required under applicable law to remit directly to the tax authorities
amounts representing withholding from distributions paid to partners.




<PAGE>


     The Partnership has acquired, either directly or through joint
ventures three shopping centers, two office buildings and an office
complex.  The Partnership sold its interest in the Mid Rivers Mall in St.
Louis, Missouri in January 1992.  In March 1996, the San Jose venture sold
its interest in the 190 San Fernando Building and one of the parking
structures at the Park Center Financial Plaza investment property.  The
Partnership sold its interest in the First Financial Plaza office building
in September 1996.  The Venture sold the 40 Broad Street Office Building in
December 1997.  All of the remaining properties were in operation at
December 31, 1997.  Subsequent to the end of the year, the Partnership sold
the Plaza Hermosa Shopping Center and the remaining assets in the Park
Center Financial Plaza office complex.  The cost of the investment
properties represents the total cost to the Partnership or its consolidated
ventures plus miscellaneous acquisition costs.

     Depreciation on the properties has been provided over the estimated
useful lives of the various components as follows:

                                                     YEARS
                                                     -----
      Building and improvements -- straight-line.      30
      Personal property -- straight-line. . . . .       5
                                                       ==

     Maintenance and repairs are generally charged to operations as
incurred.  Significant betterments and improvements are capitalized and
depreciated over their estimated useful lives.

     Statement of Financial Accounting Standards No. 121 ("SFAS 121")
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" was issued in March 1995.  The Partnership
adopted SFAS 121 as required in the first quarter of 1996.  SFAS 121
requires that the Partnership record an impairment loss on its properties
held for investment whenever their carrying value cannot be fully recovered
through estimated undiscounted future cash flows from their operations and
sale.  The amount of the impairment loss to be recognized would be the
difference between the property's carrying value and the property's
estimated fair value.  The Partnership's policy is to consider a property
to be held for sale or disposition when the Partnership has committed to a
plan to sell or dispose of such property and active marketing activity has
commenced or is expected to commence in the near term or the Partnership
has concluded that it may dispose of the property by no longer funding
operating deficits or debt service requirements of the property thus
allowing the lender to realize upon its security.   In accordance with SFAS
121, any properties identified as "held for sale or disposition" are no
longer depreciated.  Adjustments for impairment loss for such properties
(subsequent to the date of adoption of SFAS 121) are made in each period as
necessary to report these properties at the lower of carrying value or fair
value less costs to sell.  In certain situations, such estimated fair value
could be less than the existing non-recourse debt which is secured by the
property.  There can be no assurance that any estimated fair value of these
properties would ultimately be realized by the Partnership in any future
sale or disposition transaction.

     Under the prior impairment policy, provisions for value impairment
were recorded with respect to investment properties whenever the estimated
future cash flows from a property's operations and projected sale were less
than the property's net carrying value.  The amount of any such impairment
loss recognized by the Partnership was limited to the excess, if any, of
the property's carrying value over the outstanding balance of the
property's non-recourse indebtedness.

     The results of operations, net of venture partners' share, for
consolidated properties classified as held for sale or disposition as of
December 31, 1997 or sold or disposed of during the past three years were
profits of $5,866,318 and $1,961,979 and losses of $2,633,237 for the years
ended December 31, 1997, 1996 and 1995, respectively.  In addition, the
accompanying consolidated financial statements include $1,505,524, $611,483


<PAGE>


and $709,164 of the Partnership's share of total unconsolidated property
operations of $3,011,047, $1,222,965 and $1,418,328 of the properties owned
by the San Jose venture held for sale or disposition as of December 31,
1997 or sold or disposed of in the past three years, respectively.

     Certain investment properties are pledged as security for the long-
term debt, for which there is no recourse to the Partnership.

     During the second quarter of 1997, Statements of Financial Accounting
Standards No. 128 ("Earnings per Share") and No. 129 ("Disclosure of
Information about Capital Structure") were issued.  These standards became
effective for reporting periods after December 15, 1997.  As the
Partnership's capital structure only has general and limited partnership
interests, the Partnership will not experience any significant impact on
its consolidated financial statements.

     Certain 1996 and 1995 amounts have been reclassed to conform to 1997
presentation.

INVESTMENT PROPERTIES

     PLAZA HERMOSA SHOPPING CENTER

     During September 1986, the Partnership acquired a multi-building
neighborhood shopping center in Hermosa Beach, California.  The
Partnership's purchase price for the shopping center was $18,290,000, of
which $11,890,000 was paid in cash at closing.  The balance of the purchase
price was represented by bond financing in the amount of $6,400,000.

     This financing was secured by a letter of credit facility which was
ultimately secured by a deed of trust on the property.  In December 1994,
upon expiration of the letter of credit, the Partnership obtained a long-
term replacement letter of credit with a new lender and simultaneously
retired the original bond financing and issued new bonds to the existing
bondholders in the aggregate amount of $6,400,000.  The replacement letter
of credit was scheduled to expire in December 1997, but was extended for a
two year period in 1997.

     As a result of reduced projected cash flows, the upcoming maturity of
the letter of credit facility in 1999 and the expected holding period of
the property, there was uncertainty as to the Partnership's ability to
recover the net carrying value of the Plaza Hermosa investment property
through future operations or sale over its revised expected holding period.

Therefore, the Partnership made a provision for value impairment at
September 30, 1995 of $5,500,000 to reflect the then estimated fair value
of the property based upon an analysis of discounted estimated future cash
flows over the projected holding period.

     The property is managed by an affiliate of the General Partners of the
Partnership for a fee calculated as 4% of gross receipts of the property.

     As the Partnership had committed to a plan to sell the property, the
property had been classified as held for sale as of December 1, 1996 and
therefore has not been subject to continued depreciation after such date.

     On January 13, 1998, the Partnership sold the land, building and
related improvements of the Plaza Hermosa Shopping Center to an
unaffiliated third party for a sale price of $13,335,000 (before selling
costs and prorations).  The sale will result in a gain in 1998 of
approximately $4,000,000 and $2,400,000 for financial reporting and Federal
income tax purposes, respectively.  In addition, in connection with the
sale of the property, as is customary in such transactions, the Partnership
agreed to certain representations, warranties and covenants with a
stipulated survival period that expires September 15, 1998.  Although it is
not expected, the Partnership may ultimately have some liability under such
representations, warranties and covenants, but such liability has been
limited in the sale agreement to actual damages in an amount not to exceed
$800,000 in the aggregate.



<PAGE>


VENTURE AGREEMENTS - GENERAL

     The Partnership at December 31, 1997 is a party to two operating
venture agreements and has made capital contributions to the respective
ventures as discussed below.  Under certain circumstances, either pursuant
to the venture agreements or due to the Partnership's obligations as a
general partner, the Partnership may be required to make additional cash
contributions to the ventures.

     There are certain risks associated with the Partnership's investments
made through joint ventures including the possibility that the
Partnership's joint venture partners in an investment might become unable
or unwilling to fulfill their financial or other obligations, or that such
joint venture partners may have economic or business interests or goals
that are inconsistent with those of the Partnership.

     SAN JOSE

     The Partnership acquired, through San Jose, an interest in an existing
office building complex in San Jose, California (Park Center Financial
Plaza) consisting of ten office buildings, a parking and retail building
(185 Park Avenue) and two parking garage structures.

     In September 1986, San Jose obtained a mortgage loan in the amount of
$25,000,000 secured by the 150 Almaden and 185 Park Avenue buildings and
certain parking areas.  Due to the scheduled maturity of the loan, San
Jose, during the fourth quarter of 1994, finalized a loan extension and
modification with the mortgage lender.  The refinancing resulted in the
1994 partial paydown of the outstanding principal balance in the amount of
$2,500,000.

     After reviewing and analyzing San Jose's potential options with regard
to its investment in the 100-130 Park Center Plaza portion of the complex,
San Jose determined that it was in the best interest of the venture to
repay the mortgage obligations secured by this portion of the complex and
did so in October 1995.  The outstanding principal balances, at the time of
repayment, were $2,418,722 of which the Partnership's share was $1,209,361.


     The property is managed by an unaffiliated third party for a fee
calculated as 3% of gross receipts.

     The partners of San Jose are the Partnership and JMB Income
Properties, Ltd.-XI, another partnership sponsored by the Managing General
Partner of the Partnership ("JMB-XI").  The terms of San Jose's partnership
agreement generally provide that contributions, distributions, cash flow,
sale or refinancing proceeds and profits and losses will be distributed or
allocated to the Partnership and JMB-XI in their respective 50% ownership
percentages.

     During August 1994, San Jose received notification from the
Redevelopment Agency of the City of San Jose of its offer to purchase one
of the parking garage structures in the office building complex, for an
approved Agency project for $4,090,000.  The price offered was deemed by
the Agency to be just compensation in compliance with applicable laws
concerning eminent domain.  During 1995, the Agency filed a condemnation
action in court to proceed to obtain the garage pursuant to such laws.  In
late 1995, San Jose and the Agency reached a mutually acceptable agreement
on the transfer of the garage.  In March 1996, the sale was consummated.
Under the transfer agreement, San Jose received replacement parking spaces
for its tenants in a nearby city-owned parking structure for a term of
fifty-five years in addition to the aforementioned purchase price of
$4,090,000.  San Jose recognized a gain of approximately $2,036,000 and
$1,857,000, respectively, for financial reporting and Federal income tax
purposes in 1996, of which approximately $1,018,000 and $928,500,
respectively, was allocated to the Partnership.


<PAGE>


     In March 1996, San Jose sold the 190 San Fernando Building to an
independent third party.  The sale price of the building was $1,753,000
(before selling costs), and was paid in cash at closing.  San Jose
recognized a gain of approximately $789,000 and $21,000, respectively, for
financial reporting and Federal income tax purposes in 1996, of which
approximately $394,500 and $10,500, respectively, was allocated to the
Partnership.

     As San Jose had committed to a plan to sell the properties, the 190
San Fernando Building and the parking structures were classified as held
for sale or disposition as of January 1, 1996 and therefore were not
subject to continued depreciation.  The San Jose venture subsequently
committed to a plan to sell the balance of the complex, and classified the
remaining assets as held for sale as of December 31, 1996 and these assets
have, therefore, no longer been subject to continued depreciation beyond
such date.

     On February 24, 1998, San Jose sold the land, buildings, related
improvements and personal property of the remaining assets of the Park
Center Financial Plaza office complex to an unaffiliated third party for a
sale price of $76,195,000 (before selling costs and prorations).  The sale
will result in a gain in 1998 of approximately $41,000,000 and $23,000,000
for financial reporting and Federal income tax purposes, respectively, of
which approximately $20,500,000 and $11,500,000 of gain will be allocated
to the Partnership, respectively.  In addition, in connection with the sale
of the property, as is customary in such transactions, San Jose agreed to
certain representations, warranties and covenants with a stipulated
survival period that expires November 15, 1998.  Although it is not
expected, San Jose and the Partnership may ultimately have some liability
under such representations, warranties and covenants.

     TOPANGA

     In December 1985, the Partnership acquired a 58% interest in the
Topanga Plaza Shopping Center in the Woodland Hills area of Los Angeles,
California.  The aggregate purchase price for the Partnership's interest in
the venture was approximately $25,263,000, which was paid in cash at
closing.  Under the terms of the joint venture agreement, the Partnership
generally will be allocated or distributed 58% of profits and losses, cash
flow from operations and sale or refinancing proceeds.

     On January 17, 1994, an earthquake occurred in Los Angeles, California
with its epicenter in the town of Northridge, approximately six miles from
Topanga Plaza Shopping Center.  The estimated costs at Topanga for which
the joint venture was responsible was approximately $11.9 million.  The
majority of these costs were subject to recovery under the joint venture's
earthquake insurance policy.  The deductible on the earthquake casualty and
business interruption coverages was approximately $2.1 million which was
funded by Topanga from operations in 1995  and/or offset by other insurance
recoveries as discussed below.  The $11.9 million of total costs was
reimbursed through insurance proceeds.  Approximately $3.2 million of
additional insurance proceeds were collected as a final settlement during
the third quarter of 1995.  Such amount represented recoveries under the
joint venture's business interruption policy and was reflected as rental
income in the accompanying consolidated financial statements.

     In the second quarter of 1996, Topanga received, in the aggregate,
approximately $513,000 from Robinson-May and Montgomery Ward, relating to
their prorata share of expenses and costs for repairs and restorations to
the Topanga Plaza Shopping Center following the earthquake.  During 1997,
Topanga received, in the aggregate, approximately $312,000 from The
Broadway and Nordstrom, relating to their prorata share of expenses and
costs for repairs and restorations to the Topanga Plaza Shopping Center
following the earthquake.  As of the date of this report, Topanga is not
expecting to receive any significant additional reimbursements from tenants
related to the earthquake.



<PAGE>


     The joint venture partner advanced funds to the joint venture for
expenses incurred for certain development costs related to a potential
future expansion of Topanga Plaza.  The balance of these advances was
$435,000 at December 31, 1994.  Although such an expansion of the Shopping
Center is still an option, such advances were repaid to the joint venture
partner in early 1995 from available cash at the venture.

     The shopping center was subject to a long-term management agreement
with an affiliate of the joint venture partner.  Under the terms of the
management agreement, the manager was entitled to receive a management fee
based on a formula which relates to direct and general overhead costs and
expenses incurred in the operation of the property.  During 1994, the
manager of the Topanga Plaza Shopping Center, an affiliate of the joint
venture partner, was sold to an unaffiliated third party, who assumed
management at the property on the same terms which existed prior to the
sale.

     Sears had agreed to acquire the Broadway store site at the Shopping
Center.  Broadway closed in February 1996 and Sears completed its
remodeling of the store and opened in October 1996.

     Montgomery Ward, a major department store which owns its own facility,
filed for bankruptcy protection pursuant to Chapter 11 of the Federal
bankruptcy code on July 7, 1997.  The store continues to operate and
fulfill its obligations under its operating agreement.  Topanga is
considering the possibility of purchasing the Ward store to protect the
value of the shopping center.  However, there is no assurance that any such
transaction will occur.

     During the third quarter of 1997, $678,801 of the approximate $770,000
of remaining previously accrued costs related to earthquake damage in 1994,
was reversed and recognized as an extraordinary gain.  This liability was
established in 1994 for Topanga's share of the estimated repair costs due
to the earthquake damage.  This reversal is attributable to repairs which
are no longer considered necessary as a result of previously overestimated
repair costs.

     The Topanga venture committed to a plan to sell the property and
therefore classified the property as held for sale as of December 31, 1996.

The property has no longer been subject to continued depreciation beyond
such date.

     The Partnership is currently in discussions with the joint venture
partner to explore the possibility of the joint venture partner buying the
Partnership's interest in Topanga.  There can be no assurance that any
agreement will be reached in this regard.

     Concurrent with the discussions described above, the Partnership is
currently preparing to cause the joint venture to market the property for
sale to third parties, as provided for under the Topanga venture agreement.

Under such agreement, the joint venture partner and the Partnership each
have a limited right of first refusal to purchase the other's interest if a
third party offer is tendered by the other partner, which could have the
effect of lengthening the time necessary to effect a sale or discouraging
offers for the property.  There can be no assurance that any sale
transaction will occur.

     40 BROAD STREET

     During December 1985, the Partnership acquired, through Broad Street,
a joint venture with JMB Income Properties, Ltd.-X, a partnership sponsored
by an affiliate of the Managing General Partner, a 68.56% interest in the
40 Broad Street office building in New York, New York.  Broad Street's
purchase price for the building, which was paid in cash at closing, was
approximately $65,100,000 of which the Partnership provided approximately
$44,630,000.



<PAGE>


     The Partnership was allocated or distributed profits and losses, cash
flow from operations and sale or refinancing proceeds in the ratio of its
capital contributions to Broad Street which is 68.56%.

     The property was managed by an unaffiliated third party for a fee
calculated as 2% of gross receipts.

     As the Partnership had committed to a plan to sell the property as of
July 1, 1997, the property had been classified as held for sale as of that
date, and therefore, has not been subject to continued depreciation.

     On December 30, 1997, the Partnership, through the Affiliated Joint
Venture, sold the land, building, related improvements and personal
property of the 40 Broad Street office building to an unaffiliated third
party for a sale price of $34,735,000 (before selling costs).  The sale
resulted in a gain of $20,532,803 (predominantly due to provisions for
value impairment totaling approximately $52,000,000 recorded in 1990 and
1991, of which the Partnership's share was approximately $35,651,000), of
which the Partnership's share was $14,077,289 and a loss of $9,703,264, of
which the Partnership's share was $6,652,557 in 1997 for financial
reporting and Federal income tax purposes, respectively.  In addition, in
connection with the sale of the property, as is customary in such
transactions, the Affiliated Joint Venture agreed to certain
representations, warranties and covenants with a stipulated survival period
that expires December 1, 1998.  Although it is not expected, the Affiliated
Joint Venture and the Partnership may ultimately have some liability under
such representations, warranties and covenants, but such liability has been
limited in the sale agreement to actual damages in an amount not to exceed
$1,500,000 in the aggregate.

     In February 1998, the Partnership made a distribution of sale proceeds
primarily related to the sale of the property of $22,875,888 ($120 per
Interest) to the Limited Partners.

     FIRST FINANCIAL

     On May 20, 1987, the Partnership, through First Financial, a joint
venture with JMB-XIII, acquired an interest in a general partnership
("Encino") with an affiliate of the developer ("Encino Venture Partner").
Encino owned an office building in Encino (Los Angeles), California.  First
Financial made an initial investment in the aggregate amount of
approximately $49,812,000 to Encino.

     In November 1987, First Financial caused Encino to obtain a third
party first mortgage loan in the amount of $30,000,000.  The proceeds of
such loan were distributed to First Financial to reduce its contribution
and to the Encino Venture Partner who subsequently repaid a $15,500,000
loan from First Financial.  Thus, the total cash investment of First
Financial for its interest in the office building, after consideration of
the funding of the $30,000,000 permanent financing, was approximately
$20,000,000, of which the Partnership's share was approximately
$12,500,000.

     The first mortgage loan on the property matured November 1, 1995.
Effective November 1, 1995, Encino and the existing lender amended and
restated the existing mortgage loan.  The new principal balance of the
amended note at November 1, 1995 was $24,970,148.  This amount was
comprised of the then outstanding principal portion of $28,970,148 on the
original $30,000,000 note less a required $4,000,000 principal paydown by
Encino, all of which was advanced by First Financial at closing of which
the Partnership's share of such paydown was $2,500,000.  The amended loan
had an interest rate of 8.67% and a term of two years resulting in a
maturity date of November 1, 1997.



<PAGE>


     In order to finalize the loan extension described above, the
Partnership and its affiliated partner advanced approximately $4.0 million
(approximately $2.5 million by the Partnership) to the joint venture to
fund the required principal paydown and related loan fees.  A capital call
had been made on the unaffiliated joint venture partner for its share of
the total required amount; however, the unaffiliated joint venture partner
indicated that it did not intend to fund its required share.  The
Partnership and its affiliated partner reached an agreement with the
unaffiliated partner to modify the joint venture agreement.  In April 1996,
the unaffiliated partner became a limited partner as a result of this
modification.

     The First Financial office building appeared to have experienced only
minor cosmetic damage as a result of the January 17, 1994 Northridge
earthquake in southern California.  On February 22, 1995, the city council
of the city of Los Angeles passed an ordinance requiring certain buildings
(identified by building type and location) to perform testing on the welded
steel moment connections to determine if the earthquake had weakened such
joint weldings and to repair such joint weldings if weakness is detected.
This property qualified for the testing under the ordinance and therefore
Encino retained a structural engineer to perform the testing.  Results of
the testing by the structural engineer indicated that some of the
building's joint weldings suffered damage which, in accordance with the
ordinance, were required to be repaired.  Encino's structural engineer
informed Encino that the damage detected did not pose a life safety risk
for the building's tenants.  All testing and repairs necessary to comply
with such ordinance were completed as of October 1995.  The total cost of
such testing and repairs was approximately $826,000 (of which the
Partnership's share was approximately $516,250).

     The First Financial office building was classified as held for sale as
of April 1, 1996 and therefore was not subject to continued depreciation
since such date.

     On September 11, 1996, the joint venture sold the First Financial
office building to an unaffiliated third-party for a sale price of
$37,900,000 (before selling costs and prorations).  The joint venture
received $13,095,445 of net sale proceeds at closing (which reflected the
assumption by the buyer of the mortgage loan with a current balance of
$24,704,555 and closing costs), substantially all of which were allocable
to First Financial pursuant to the Encino venture agreement.  The sale
resulted in approximately $2,880,000 and $18,800,000 of gain for financial
reporting purposes and Federal income tax purposes in 1996, respectively,
of which approximately $1,612,000 and $2,000 of gain was allocated to the
Partnership, respectively.  The Partnership made a cash distribution of $42
per Interest from the sales proceeds in November 1996.

     The Encino partnership agreement generally provided that First
Financial was entitled to receive (after any participating amounts due to
Pepperdine University pursuant to its tenant lease) from cash flow from
operations (as defined) an annual cumulative preferred return equal to
9.05% through April 30, 1995 (and 8.9% thereafter) of its capital contri-
butions.  Any remaining cash flow was to be split equally between First
Financial and the Encino Venture Partner.  Pepperdine University, under its
tenant lease, was entitled to an amount based on 6.6% of the Venture
Partner's share of the office building's net operating profit and net sale
profit (as defined).  All of Encino's operating profits and losses before
depreciation were allocated to First Financial in 1995 and 1996.

     The Encino partnership agreement also generally provided that net sale
proceeds and net refinancing proceeds (as defined), after any amounts due
to Pepperdine University pursuant to its tenant lease, were to be
distributed:  first, to First Financial in an amount equal to the
deficiency, if any, in its cumulative preferred return as described above;
next, to First Financial in the amount of its capital contributions; next,
to the Encino Venture Partner in an amount equal to $600,000; any remaining
proceeds were to be split equally between First Financial and the Encino
Venture Partner.


<PAGE>


     The terms of the First Financial partnership agreement provided that
annual cash flow, net sale or refinancing proceeds, and tax items were to
be distributed or allocated, as the case may be, to the Partnership in
proportion to its 62.5% share of capital contributions.

     The office building was managed by an affiliate of the Encino Venture
Partner for a fee based upon a percentage of rental receipts (as defined)
of the property.


LONG-TERM DEBT

     Long-term debt consists of the following at December 31, 1997 and
1996:
                                            1997            1996
                                        -----------     -----------
10-1/8% mortgage note secured by
 the Topanga Plaza shopping center
 in Los Angeles, California; payable
 in monthly installments of principal
 and interest of $523,225 through
 January 2002  when the remaining
 balance is due and payable . . .       $57,230,727      57,689,284

Floating rate bond financing
 (certificates), secured by the
 Plaza Hermosa Shopping Center
 in Hermosa Beach, California;
 the certificates bear interest
 based on a floating rate
 which is adjustable weekly
 (as defined), with a maximum
 interest rate of 13.5%, interest
 only is payable monthly through
 December 2023 when the entire
 outstanding balance is due and
 payable (repaid upon sale
 in January 1998) . . . . . . . .         6,400,000       6,400,000
                                        -----------     -----------
          Total debt. . . . . . .        63,630,727      64,089,284
          Less current portion
            of long-term debt . .           507,202         458,557
                                        -----------     -----------
          Total long-term debt. .       $63,123,525      63,630,727
                                        ===========     ===========

     Five year scheduled maturities of long-term debt are summarized as
follows:

                    1998. . . . . . . . . .     $   507,202
                    1999. . . . . . . . . .         561,008
                    2000. . . . . . . . . .         620,521
                    2001. . . . . . . . . .         686,348
                    2002. . . . . . . . . .      54,855,647
                                                ===========


PARTNERSHIP AGREEMENT

     Pursuant to the terms of the Partnership Agreement, net profits or
losses of the Partnership from operations are allocated 96% to the Limited
Partners and 4% to the General Partners.  Profits from the sale or
refinancing of investment properties will be allocated to the General
Partners: (i) in an amount equal to the greater of 1% of such profits or
the amount of cash distributable to the General Partners from any such sale


<PAGE>


or refinancing (as described below); and (ii) in order to reduce deficits,
if any, in the General Partners' capital accounts to a level consistent
with the gain anticipated to be realized from the sale of properties.
Losses from the sale or refinancing of investment properties will be
allocated 1% to the General Partners.  The remaining sale or refinancing
profits and losses will be allocated to the Limited Partners.

     The General Partners are not required to make any capital contri-
butions except under certain limited circumstances upon termination of the
Partnership.  In general, distributions of cash from operations will be
made 90% to the Limited Partners and 10% to the General Partners.  However,
a portion of such distributions to the General Partners is subordinated to
the Limited Partners' receipt of a stipulated return on capital.

     The Partnership Agreement provides that the General Partners shall
receive as a distribution from the sale of a real property by the
Partnership amounts equal to the cumulative deferrals of any portion of
their 10% cash distribution and 2-1/2% of the selling price, and that the
remaining proceeds (net after expenses and retained working capital) be
distributed 85% to the Limited Partners and 15% to the General Partners.
However, notwithstanding such allocations, the Limited Partners shall
receive 100% of such net sale proceeds until the Limited Partners (i) have
received cash distributions of sale or refinancing proceeds in an amount
equal to the Limited Partners' aggregate initial capital investment in the
Partnership, (ii) have received cumulative cash distributions from the
Partnership's operations which, when combined with sale or refinancing
proceeds previously distributed, equal a 6% annual return on the Limited
Partners' average capital investment for each year (their initial capital
investment as reduced by sale or refinancing proceeds previously
distributed) commencing with the second fiscal quarter of 1986 and (iii)
have received cash distributions of sale and refinancing proceeds and of
the Partnership's operations, in an amount equal to the Limited Partners'
initial capital investment in the Partnership plus a 10% annual return on
the Limited Partners' average capital investment.  As the above levels of
return are not expected to be achieved, the General Partners have waived
their right to receive any portion of the proceeds from the sales of
property by the Partnership.

LEASES

     At December 31, 1997, the Partnership and its consolidated ventures'
principal assets are two shopping centers.  The Partnership has determined
that all leases relating to these properties are properly classified as
operating leases; therefore, rental income is reported when earned and the
cost of the properties, excluding the cost of the land, is depreciated over
the estimated useful lives.  Leases with tenants range in term from month-
to-month to twenty-five years and provide for fixed minimum rent and
partial reimbursement of operating costs.  In addition, substantially all
of the leases provide for additional rent based upon percentages of
tenants' sales volumes.  A substantial portion of the ability of retail
tenants to honor their leases is dependent on the retail economic sector.

     Minimum lease payments, including amounts representing executory costs
(e.g. taxes, maintenance, insurance) and any related profit, to be received
in the future under the operating leases are as follows:

                    1998. . . . . . . . . .   $ 10,469,801
                    1999. . . . . . . . . .     10,277,342
                    2000. . . . . . . . . .      9,901,830
                    2001. . . . . . . . . .      9,645,557
                    2002. . . . . . . . . .      9,023,985
                    Thereafter. . . . . . .     25,281,458
                                              ------------
                        Total . . . . . . .   $ 74,599,973
                                              ============



<PAGE>


     Contingent rent (based on sales by property tenants) included in
rental income was as follows:

                    1995. . . . . . . . . .       $438,733
                    1996. . . . . . . . . .        301,919
                    1997. . . . . . . . . .        183,895
                                                  ========

TRANSACTIONS WITH AFFILIATES

     The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Managing General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investments.  Fees, commissions and other
expenses required to be paid by the Partnership to the General Partners and
their affiliates as of December 31, 1997 and for the years ended December
31, 1997, 1996 and 1995 are as follows:

                                                         UNPAID AT
                                                        DECEMBER 31,
                            1997       1996      1995      1997
                          --------   --------  -------- ------------
Property management
 and leasing fees . . . . $ 79,670     70,792    67,422      --
Insurance
 commissions. . . . . . .   22,214     34,632    75,330      --
Reimbursement (at cost)
 for accounting
 services . . . . . . . .   24,372      9,642    90,577    12,474
Reimbursement (at cost)
 for portfolio manage-
 ment services. . . . . .   39,225     25,996    38,217    11,405
Reimbursement (at cost)
 for legal services . . .   11,542      8,683     4,222     4,078
Reimbursement (at cost)
 for administrative
 charges and other
 out-of-pocket expenses .     842       1,026   170,348      --
                          --------   --------  --------    ------
                          $177,865    150,771   446,116    27,957
                          ========   ========  ========    ======

     Certain of the Partnership's properties are managed by affiliates of
the General Partners or their assignees for fees computed as a percentage
of certain rents received by the properties.

     During 1994, certain officers and directors of the Managing General
Partner acquired interests in a company which provides certain property
management services to a property owned by the Partnership.  The fees
earned by such company from the Partnership for the years ended
December 31, 1997, 1996 and 1995 were approximately $32,500, $39,000 and
$30,000, respectively, all of which has been paid at December 31, 1997.

     In accordance with the subordination requirements of the Partnership
Agreement, the General Partners have deferred receipt of their distri-
butions of net cash flow from the Partnership.  The cumulative amount of
such deferred distributions aggregated $8,684,505 at December 31, 1997.
The amount is being deferred in accordance with the subordination
requirements of the Partnership Agreement as discussed above.  The
Partnership does not expect that the subordination requirements of the
Partnership Agreement will be satisfied to permit payment of the majority
of these amounts.  These amounts or amounts currently payable do not bear
interest.



<PAGE>


INVESTMENT IN UNCONSOLIDATED VENTURE

     Summary of financial information for San Jose as of and for the years
ended December 31, 1997 and 1996 is as follows:

                                          1997            1996
                                      ------------    ------------

Current assets. . . . . . . . . .     $  4,819,672       4,538,120
Current liabilities . . . . . . .         (619,337)       (456,506)
                                      ------------    ------------
      Working capital . . . . . .        4,200,335       4,081,614
Investment property, net. . . . .       30,803,149      28,430,666
Other assets, net . . . . . . . .        1,204,478         959,991
Long-term debt. . . . . . . . . .      (22,961,889)    (23,338,875)
Other liabilities . . . . . . . .         (181,229)        (79,599)
Venture partners' equity. . . . .       (6,711,162)     (5,205,639)
                                      ------------    ------------
      Partnership's capital . . .     $  6,353,682       4,848,158
                                      ============    ============
Represented by:
  Invested capital. . . . . . . .     $ 48,767,680      48,767,680
  Cumulative distributions. . . .      (25,490,500)    (25,490,500)
  Cumulative loss . . . . . . . .      (16,923,498)    (18,429,022)
                                      ------------    ------------
                                      $  6,353,682       4,848,158
                                      ============    ============
Total income. . . . . . . . . . .     $  9,404,683       9,238,168
                                      ============    ============
Expenses. . . . . . . . . . . . .     $  6,393,636       8,015,203
                                      ============    ============
Gain on disposition of
  investment property . . . . . .     $      --          2,825,220
                                      ============    ============
Net earnings. . . . . . . . . . .     $  3,011,047       4,048,185
                                      ============    ============

    Total income, expenses and net earnings for the above-mentioned venture
for the year ended December 31, 1995 were $6,412,066, $9,182,446 and
$1,418,328, respectively.





<PAGE>


<TABLE>

                                                                                          SCHEDULE III
                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES
                            CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION
                                              DECEMBER 31, 1997

<CAPTION>

                                                         COSTS
                                                      CAPITALIZED
                               INITIAL COST TO         SUBSEQUENT           GROSS AMOUNT AT WHICH CARRIED
                               PARTNERSHIP (A)      TO ACQUISITION              AT CLOSE OF PERIOD (B)
                          -------------------------  --------------    ------------------------------------
                                        BUILDINGS      BUILDINGS                    BUILDINGS
                                          AND            AND                           AND
              ENCUMBRANCE     LAND     IMPROVEMENTS IMPROVEMENTS(D)       LAND     IMPROVEMENTS   TOTAL (E)
              -----------  ----------- ------------  --------------    ----------  ------------ -----------
<S>          <C>          <C>         <C>            <C>              <C>         <C>          <C>
SHOPPING
 CENTERS:
Los Angeles,
 California
 (C). . . . . $57,230,727    8,506,014   54,714,281     46,124,455      8,506,014   100,838,736 109,344,750
Hermosa
 Beach,
 California .   6,400,000    5,106,570   13,131,181     (3,073,895)     3,176,525    10,057,286  13,233,811
              -----------   ----------  -----------    -----------     ----------   ----------- -----------

    Total . . $63,630,727   13,612,584  67,845,462      43,050,560     11,682,539   110,896,022 122,578,561
              ===========   ==========  ===========    ===========     ==========   =========== ===========

</TABLE>


<PAGE>


<TABLE>
                                                                              SCHEDULE III - CONTINUED
                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES
                      CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
                                              DECEMBER 31, 1997


<CAPTION>
                                                                                 LIFE ON WHICH
                                                                                 DEPRECIATION
                                                                                  IN LATEST
                                                                                 STATEMENT OF      1997
                                   ACCUMULATED           DATE OF      DATE        OPERATIONS    REAL ESTATE
                                  DEPRECIATION(F)     CONSTRUCTION  ACQUIRED     IS COMPUTED       TAXES
                                 ----------------     ------------ ----------  ---------------  -----------
<S>                             <C>                  <C>          <C>         <C>              <C>
SHOPPING CENTERS:
 Los Angeles,
  California (C). . . . . . . . . .  $26,570,333          1964       12/31/85       5-30 years     753,698
 Hermosa Beach,
   California . . . . . . . . . . .    4,332,391          1985       09/03/86       5-30 years     212,784
                                     -----------                                                 ---------
    Total . . . . . . . . . . . . .  $30,902,724                                                   966,482
                                     ===========                                                 =========
<FN>
------------------

Notes:
     (A)  The initial cost to the Partnership represents the original purchase price of the properties, including
amounts incurred subsequent to acquisition which were contemplated at the time the property was acquired.
     (B)  The aggregate cost of real estate owned at December 31, 1997 for Federal income tax purposes was
$112,612,934.
     (C)  Properties owned and operated by joint venture.
     (D)  In 1995, the Partnership recorded a provision for value impairment totaling $5,500,000 (which included a
reduction in deferred costs of $15,671) at the Plaza Hermosa Shopping Center.

</TABLE>


<PAGE>


<TABLE>                                                                       SCHEDULE III - CONTINUED
                                      JMB INCOME PROPERTIES, LTD. - XII
                                           (A LIMITED PARTNERSHIP)
                                          AND CONSOLIDATED VENTURES
                      CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
                                              DECEMBER 31, 1997


(E)   Reconciliation of real estate owned:

<CAPTION>
                                                             1997            1996              1995
                                                         ------------    ------------     ------------
     <S>                                                <C>             <C>              <C>
     Balance at beginning of period . . . . . . . . .    $146,082,153     189,130,405      193,298,414
     Additions during period. . . . . . . . . . . . .       1,743,255       1,583,556        1,316,320
     Sale or disposal during period . . . . . . . . .     (25,246,847)    (44,631,808)           --
     Provision for value impairment . . . . . . . . .           --              --          (5,484,329)
                                                         ------------     -----------      -----------

     Balance at end of period . . . . . . . . . . . .    $122,578,561     146,082,153      189,130,405
                                                         ============     ===========      ===========

(F)   Reconciliation of accumulated depreciation:

     Balance at beginning of period . . . . . . . . .    $ 45,776,427      52,390,756       46,792,110
     Depreciation expense . . . . . . . . . . . . . .         328,493       4,625,655        5,598,646
     Sale or disposal during period . . . . . . . . .     (15,202,196)    (11,239,984)           --
                                                         ------------     -----------      -----------

     Balance at end of period . . . . . . . . . . . .    $ 30,902,724      45,776,427       52,390,756
                                                         ============     ===========      ===========

</TABLE>


<PAGE>












                     INDEPENDENT AUDITORS' REPORT


The Partners
JMB/SAN JOSE ASSOCIATES:

     We have audited the financial statements of JMB/San Jose Associates (a
general partnership) as listed in the accompanying index.  In connection
with our audits of the financial statements, we also have audited the
financial statement schedule as listed in the accompanying index.  These
financial statements and financial statement schedule are the
responsibility of the General Partners of the Partnership.  Our
responsibility is to express an opinion on these financial statements and
financial statement schedule based on our audits.

     We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles
used and significant estimates made by the General Partners of the
Partnership, 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 financial statements referred to above present
fairly, in all material respects, the financial position of JMB/San Jose
Associates at December 31, 1997 and 1996, and the results of its operations
and its cash flows for each of the years in the three-year period ended
December 31, 1997, in conformity with generally accepted accounting
principles.  Also in our opinion, the related financial statement schedule,
when considered in relation to the basic financial statements taken as a
whole, presents fairly, in all material respects, the information set forth
therein.

     As discussed in the Notes to the financial statements, in 1996 the
Partnership changed its method of accounting for long-lived assets and
long-lived assets to be disposed of to conform with Statement of Financial
Accounting Standards No. 121.








                                        KPMG PEAT MARWICK LLP



Chicago, Illinois
March 25, 1998






<PAGE>


<TABLE>
                                           JMB/SAN JOSE ASSOCIATES
                                           (A GENERAL PARTNERSHIP)

                                               BALANCE SHEETS

                                         DECEMBER 31, 1997 AND 1996

                                                   ASSETS
                                                   ------
<CAPTION>
                                                                            1997              1996
                                                                         -----------      -----------
<S>                                                                     <C>               <C>
Current assets:
  Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . .    $ 2,783,007        2,260,010
  Rents and other receivables, net of allowance for
    doubtful accounts of $0 in 1997 and $1,648,319
    in 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      1,849,882        2,111,845
  Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . .         89,913           92,041
  Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . .         96,870           74,223
                                                                         -----------      -----------

          Total current assets. . . . . . . . . . . . . . . . . . . .      4,819,672        4,538,119
                                                                         -----------      -----------

Property held for sale or disposition . . . . . . . . . . . . . . . .     30,803,149       28,430,666
                                                                         -----------      -----------

Deferred expenses . . . . . . . . . . . . . . . . . . . . . . . . . .      1,204,478          959,992
                                                                         -----------      -----------

                                                                         $36,827,299       33,928,777
                                                                         ===========      ===========





<PAGE>


                                           JMB/SAN JOSE ASSOCIATES
                                           (A GENERAL PARTNERSHIP)

                                         BALANCE SHEETS - CONTINUED


                                 LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS
                                 ------------------------------------------

                                                                             1997             1996
                                                                         -----------      -----------

Current liabilities:
  Current portion of long-term debt . . . . . . . . . . . . . . . . .    $   376,986           92,988
  Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . .         79,396          199,955
  Accrued interest payable. . . . . . . . . . . . . . . . . . . . . .        162,955          163,563
                                                                         -----------      -----------

          Total current liabilities . . . . . . . . . . . . . . . . .        619,337          456,506

Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . .        181,229           79,599
Long-term debt, less current portion. . . . . . . . . . . . . . . . .     22,961,889       23,338,875
                                                                         -----------      -----------
Commitments and contingencies

          Total liabilities . . . . . . . . . . . . . . . . . . . . .     23,762,455       23,874,980

Partners' capital accounts. . . . . . . . . . . . . . . . . . . . . .     13,064,844       10,053,797
                                                                         -----------      -----------

                                                                         $36,827,299       33,928,777
                                                                         ===========      ===========
















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


<PAGE>


<TABLE>
                                           JMB/SAN JOSE ASSOCIATES
                                           (A GENERAL PARTNERSHIP)

                                          STATEMENTS OF OPERATIONS

                                YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

<CAPTION>
                                                           1997             1996            1995
                                                        -----------      -----------     -----------
<S>                                                    <C>              <C>             <C>
Income:
  Rental income . . . . . . . . . . . . . . . . . .     $ 9,249,115        9,125,251       9,071,667
  Interest income . . . . . . . . . . . . . . . . .         155,568          112,917         110,779
  Gain on sale of investment property . . . . . . .           --           2,825,220           --
                                                        -----------      -----------     -----------

                                                          9,404,683       12,063,388       9,182,446
                                                        -----------      -----------     -----------

Expenses:
  Mortgage and other interest . . . . . . . . . . .       1,958,848        1,965,892       2,202,191
  Depreciation. . . . . . . . . . . . . . . . . . .           --           1,044,296       1,114,143
  Property operating expenses . . . . . . . . . . .       4,160,963        4,728,651       4,237,476
  Amortization of deferred expenses . . . . . . . .         273,825          276,364         210,308
                                                        -----------      -----------     -----------

                                                          6,393,636        8,015,203       7,764,118
                                                        -----------      -----------     -----------

          Net earnings. . . . . . . . . . . . . . .     $ 3,011,047        4,048,185       1,418,328
                                                        ===========      ===========     ===========















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


<PAGE>


<TABLE>
                                           JMB/SAN JOSE ASSOCIATES
                                           (A GENERAL PARTNERSHIP)

                                  STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS

                                YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995




<CAPTION>
                                               AFFILIATED
                                                 PARTNER               JMB - XII                 TOTAL
                                               -----------            -----------            -----------
<S>                                          <C>                     <C>                    <C>
Balance at December 31, 1994. . . .            $ 6,076,945              5,719,465             11,796,410

Capital contributions . . . . . . .              1,233,436              1,233,437              2,466,873
Cash distributions. . . . . . . . .             (1,250,000)            (1,250,000)            (2,500,000)
Net earnings. . . . . . . . . . . .                709,165                709,164              1,418,329
                                               -----------            -----------            -----------

Balance at December 31, 1995. . . .              6,769,546              6,412,066             13,181,612

Cash distributions. . . . . . . . .             (3,588,000)            (3,588,000)            (7,176,000)
Net earnings. . . . . . . . . . . .              2,024,093              2,024,092              4,048,185
                                               -----------            -----------            -----------

Balance at December 31, 1996. . . .              5,205,639              4,848,158             10,053,797

Net earnings. . . . . . . . . . . .              1,505,523              1,505,524              3,011,047
                                               -----------            -----------            -----------
Balance at December 31, 1997. . . .            $ 6,711,162              6,353,682             13,064,844
                                               ===========            ===========            ===========













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


<PAGE>


<TABLE>
                                           JMB/SAN JOSE ASSOCIATES
                                           (A GENERAL PARTNERSHIP)

                                          STATEMENTS OF CASH FLOWS

                                YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

<CAPTION>
                                                            1997            1996            1995
                                                       ------------      -----------     -----------
<S>                                                   <C>               <C>             <C>
Cash flows from operating activities:
  Net earnings. . . . . . . . . . . . . . . . . . .    $  3,011,047        4,048,185       1,418,328
  Items not requiring (providing) cash:
    Depreciation. . . . . . . . . . . . . . . . . .           --           1,044,296       1,114,143
    Amortization of deferred expenses . . . . . . .         273,825          276,364         210,308
    Gain on sale of investment property . . . . . .           --          (2,825,220)          --
  Changes in:
    Rents and other receivables . . . . . . . . . .         261,963          398,749         (19,820)
    Prepaid expenses. . . . . . . . . . . . . . . .           2,128          (20,632)          --
    Escrow deposits . . . . . . . . . . . . . . . .         (22,647)         232,577        (268,535)
    Accounts payable. . . . . . . . . . . . . . . .        (120,559)         134,662        (323,557)
    Accrued interest payable. . . . . . . . . . . .            (608)            (562)        (32,398)
    Tenant security deposits. . . . . . . . . . . .         101,630           30,729         (23,223)
                                                        -----------      -----------     -----------

        Net cash provided by (used in)
          operating activities. . . . . . . . . . .       3,506,779        3,319,148       2,075,246
                                                        -----------      -----------     -----------

Cash flows from investing activities:
  Additions to investment property. . . . . . . . .      (2,372,483)      (1,485,395)       (156,254)
  Payment of deferred expenses. . . . . . . . . . .        (518,311)        (402,481)       (218,059)
  Proceeds from sale of investment property . . . .           --           5,824,041           --
                                                        -----------      -----------     -----------

        Net cash provided by (used in)
          investing activities. . . . . . . . . . .      (2,890,794)       3,936,165        (374,313)
                                                        -----------      -----------     -----------












<PAGE>


                                           JMB/SAN JOSE ASSOCIATES
                                           (A GENERAL PARTNERSHIP)

                                    STATEMENTS OF CASH FLOWS - CONTINUED


                                                            1997            1996            1995
                                                        -----------      -----------     -----------

Cash flows from financing activities:
  Principal payments on long-term debt. . . . . . .         (92,988)         (85,989)       (374,973)
  Paydowns on long-term debt. . . . . . . . . . . .           --               --         (2,418,722)
  Capital contributed to venture. . . . . . . . . .           --               --          2,466,873
  Distributions to partners . . . . . . . . . . . .           --          (7,176,000)     (2,500,000)
                                                        -----------      -----------     -----------

        Net cash provided by (used in) financing
          activities. . . . . . . . . . . . . . . .         (92,988)      (7,261,989)     (2,799,822)
                                                        -----------      -----------     -----------

        Net increase (decrease) increase
          in cash and cash equivalents. . . . . . .         522,997           (6,676)     (1,098,889)
                                                        -----------      -----------     -----------

        Cash and cash equivalents,
          beginning of year . . . . . . . . . . . .       2,260,010        2,266,686       3,365,575
                                                        -----------      -----------     -----------
        Cash and cash equivalents,
          end of year . . . . . . . . . . . . . . .     $ 2,783,007        2,260,010       2,266,686
                                                        ===========      ===========     ===========

Supplemental disclosure of cash flow information:
  Cash paid for mortgage and other interest . . . .     $ 1,959,456        1,966,455       2,234,589
  Non-cash investing and financing activities:
    Cash sale proceeds, net of selling expenses . .     $     --           5,824,041           --
    Reduction in investment property, net . . . . .           --          (2,966,325)          --
    Reduction in other assets and liabilities . . .           --             (32,496)          --
                                                        -----------      -----------     -----------
          Gain recognized on sale of property . . .     $     --           2,825,220           --
                                                        ===========      ===========     ===========








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


<PAGE>


                        JMB/SAN JOSE ASSOCIATES
                        (A GENERAL PARTNERSHIP)

                     NOTES TO FINANCIAL STATEMENTS

             YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995


OPERATIONS AND BASIS OF ACCOUNTING

     The accompanying financial statements have been prepared for the
purpose of complying with Rule 3.09 of Regulation S-X of the Securities and
Exchange Commission.  They include the accounts of the unconsolidated joint
venture, JMB/San Jose Associates ("San Jose"), in which JMB Income
Properties, Ltd.-XII ("JMB Income-XII" or "Partnership") and JMB Income
Properties, Ltd.-XI ("JMB Income-XI" or "Affiliated Partner") are the
partners.

     San Jose holds an equity investment in a commercial office complex in
San Jose, California.  Business activities consist of rentals to a wide
variety of commercial companies and governmental entities, and the ultimate
sale or disposition of such real estate.

     As San Jose has determined to sell the complex, all portions of the
office complex have been classified as held for sale or disposition as of
or during the period ended December 31, 1996.  Therefore, the complex is
not subject to continued depreciation.  Certain portions of the office
complex were sold during 1996.  The results of operations of the complex
included in the accompanying financial statements were earnings of
$2,855,479, $1,110,048 and $1,307,549 for the years ended December 31,
1997, 1996 and 1995, respectively.

     On February 24, 1998, San Jose sold the land and related improvements
of the remaining assets of the Park Center Financial Plaza office complex
for $76,195,000.  San Jose received approximately $49,400,000 of net sale
proceeds at closing (after the repayment by San Jose of the mortgage loans
secured by the 170 Almaden, 150 Almaden and 185 Park Avenue buildings with
a balance of approximately $23,300,000, loan prepayment premiums of
approximately $2,422,000 and closing costs), of which the Partnership's
share was approximately $24,700,000.  A description of the sale of the
property is contained in the Notes of the financial statements of JMB
Income - XII.  Such notes are incorporated herein by reference.

     The Partnership uses the allowance method of accounting for doubtful
accounts.  Provisions for uncollectible tenant receivables in the amounts
of $0, $588,052 and $783,417 were recorded in 1997, 1996 and 1995,
respectively.  Bad debt expense is included in Property Operating Expenses.

     The preparation of financial statements in accordance with GAAP
requires San Jose to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period.  Actual amounts could differ from those
estimates.

     The accounting policies of San Jose are the same as those of the
Partnership.  Accordingly, reference is made to the Notes to the
Partnership's consolidated financial statements filed with this annual
report.  Such notes are incorporated herein by reference.

VENTURE AGREEMENT

      A description of the venture agreement and the management agreement
is contained in the Notes to Consolidated Financial Statements of JMB
Income - XII.  Such note is incorporated herein by reference.





<PAGE>


MANAGEMENT AGREEMENT

     In December 1994, the property manager, an affiliate of the General
Partners of the Partnership, sold substantially all of its assets and
assigned its interest in the management contracts to an unaffiliated third
party who continues to manage the complex.  In addition, certain of the
management personnel of the property manager became management personnel of
the purchaser and its affiliates.

LONG-TERM DEBT

      Long-term debt consists of the following at December 31, 1997 and
1996:
                                        1997          1996
                                     ----------    ----------
7.85% mortgage note; secured by
 the 170 Almaden Building in
 San Jose, California; principal
 and interest payments of $13,537
 are due monthly through
 September 2003 when the remaining
 principal of approximately
 $169,000 is due. . . . . . . . .    $  838,875       931,863

8.4% mortgage note; secured by the
 150 Almaden and 185 Park Avenue
 buildings, and certain related
 parking improvements in San Jose,
 California; interest only payments
 of $157,500 are due monthly through
 December 1997; principal and
 interests payments of $179,663 are
 due monthly through November 2001
 when the entire principal of approx-
 imately $21,421,000 is due . . .    22,500,000    22,500,000
                                    -----------    ----------
        Total debt. . . . . . . .    23,338,875    23,431,863
        Less current portion
         of long-term debt. . . .       376,986        92,988
                                    -----------    ----------
        Total long-term debt. . .   $22,961,889    23,338,875
                                    ===========    ==========

     Five year scheduled maturities of long-term debt are as follows:

                    1998. . . . . . . . . .     $   376,986
                    1999. . . . . . . . . .         409,305
                    2000. . . . . . . . . .         444,398
                    2001. . . . . . . . . .      21,723,357
                    2002. . . . . . . . . .         137,509
                                                ===========

TRANSACTIONS WITH AFFILIATES

     Fees, commissions and other expenses required to be paid by San Jose
to the General Partners and their affiliates as of December 31, 1997 and
for the years ended December 31, 1997, 1996 and 1995 were as follows:

                                                            UNPAID AT
                                                           DECEMBER 31,
                            1997       1996       1995        1997
                          --------   --------   --------   ------------
Property management
  and leasing fees. .     $ 65,012     77,870     60,000        --
Insurance commissions       23,530     25,768     30,140        --
                          --------    -------    -------      ------
                          $ 88,542    103,638     90,140        --
                          ========    =======    =======      ======



<PAGE>


<TABLE>
                                                                                                               SCHEDULE III
                                                       JMB/SAN JOSE ASSOCIATES
                                                       (A GENERAL PARTNERSHIP)

                                              REAL ESTATE AND ACCUMULATED DEPRECIATION

                                                          DECEMBER 31, 1997



<CAPTION>


                                    INITIAL COST TO                                   GROSS AMOUNT AT WHICH CARRIED
                                    PARTNERSHIP (A)                COSTS                AT CLOSE OF PERIOD (B)
                             ------------------------------     CAPITALIZED    ------------------------------------------
                                                BUILDINGS      SUBSEQUENT TO                    BUILDINGS
                                                  AND           ACQUISITION                        AND
                 ENCUMBRANCE      LAND         IMPROVEMENTS       (C) (D)           LAND       IMPROVEMENTS     TOTAL (E)
                 -----------    -----------    ------------   --------------     ----------    ------------    ----------
<S>            <C>             <C>            <C>            <C>                <C>           <C>            <C>

OFFICE BLDS:
 San Jose,
   California    $23,338,875     21,078,745      62,309,815     (19,621,073)      5,867,750      42,688,742    48,556,492
                 ===========     ==========      ==========     ===========      ==========      ==========   ===========























</TABLE>


<PAGE>


<TABLE>
                                                                                                      SCHEDULE III - CONTINUED
                                                             JMB/SAN JOSE ASSOCIATES
                                                       (A GENERAL PARTNERSHIP)

                                              REAL ESTATE AND ACCUMULATED DEPRECIATION

                                                          DECEMBER 31, 1997

<CAPTION>
                                                                                  LIFE ON WHICH
                                                                                  DEPRECIATION
                                                                                   IN LATEST
                                                                                  STATEMENT OF          1997
                              ACCUMULATED              DATE OF        DATE         OPERATIONS       REAL ESTATE
                             DEPRECIATION(F)        CONSTRUCTION    ACQUIRED      IS COMPUTED          TAXES
                            ----------------        ------------   ----------   ---------------     -----------
<S>                        <C>                     <C>            <C>          <C>                 <C>
OFFICE BUILDINGS:
 San Jose,                                                            6/20/85
   California . . . . . . .      $17,753,343            1970       and 5/2/86        5-30 years         528,193
                                 ===========                                                            =======
<FN>
--------------

Notes:
     (A)  The initial cost to San Jose represents the original purchase price of the property, including amounts incurred
subsequent to acquisition which were contemplated at the time the property was acquired.

     (B)  The aggregate cost of real estate owned at December 31, 1997 for Federal income tax purposes was $89,267,717.

     (C)  Through December 31, 1997, San Jose has recorded provisions for value impairment totaling $45,811,547.

     (D)   During 1996, San Jose sold the 190 San Fernando Building and one of the parking garage structures in
the complex in two separate transactions as described more fully in the Notes to Consolidated Financial Statements
of the Partnership.












</TABLE>


<PAGE>


<TABLE>
                                                                                                      SCHEDULE III - CONTINUED
                                                       JMB/SAN JOSE ASSOCIATES
                                                       (A GENERAL PARTNERSHIP)

                                              REAL ESTATE AND ACCUMULATED DEPRECIATION

                                                          DECEMBER 31, 1997

(E)   Reconciliation of real estate owned:

<CAPTION>
                                                             1997                1996                 1995
                                                         ------------        ------------        ------------
     <S>                                                <C>                 <C>                 <C>
     Balance at beginning of period . . . . . . . . .     $46,184,009          49,530,107          49,373,853
     Additions during period. . . . . . . . . . . . .       2,372,483           1,485,395             156,254
      Sales of investment property. . . . . . . . . .           --             (4,831,493)              --
                                                          -----------         -----------         -----------

     Balance at end of period . . . . . . . . . . . .     $48,556,492          46,184,009          49,530,107
                                                          ===========         ===========         ===========

(F)   Reconciliation of accumulated depreciation:

     Balance at beginning of period . . . . . . . . .     $17,753,343          18,574,214          17,460,071
      Sales of investment property. . . . . . . . . .           --             (1,865,167)              --
     Depreciation expense . . . . . . . . . . . . . .           --              1,044,296           1,114,143
                                                          -----------         -----------         -----------

     Balance at end of period . . . . . . . . . . . .     $17,753,343          17,753,343          18,574,214
                                                          ===========         ===========         ===========
















</TABLE>


<PAGE>


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

     There were no changes of or disagreements with accountants during 1997
and 1996.



                               PART III


ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP

     The Managing General Partner of the Partnership is JMB Realty
Corporation ("JMB"), a Delaware corporation, substantially all of the
outstanding stock of which is owned, directly or indirectly, by certain of
its officers, directors, members of their families and their affiliates.
JMB has responsibility for all aspects of the Partnership's operations.
ABPP Associates, L.P., is an Illinois limited partnership with JMB as its
sole general partner, is one of the Associate General Partners of the
Partnership and is also the sole general partner of Income Partners - XII,
an Illinois limited partnership that is the other Associate General Partner
of the Partnership.  The limited partners of ABPP Associates, L.P. are
generally officers, directors and affiliates of JMB or its affiliates.

    The Partnership is subject to certain conflicts of interest arising out
of its relationships with the General Partners and their affiliates as well
as the fact that the General Partners and their affiliates are engaged in a
range of real estate activities.  Certain services have been and may in the
future be provided to the Partnership or its investment properties by
affiliates of the General Partners, including property management services
and insurance brokerage services.  In general, such services are to be
provided on terms no less favorable to the Partnership than could be
obtained from independent third parties and are otherwise subject to
conditions and restrictions contained in the Partnership Agreement.  The
Partnership Agreement permits the General Partners and their affiliates to
provide services to, and otherwise deal and do business with, persons who
may be engaged in transactions with the Partnership, and permits the
Partnership to borrow from, purchase goods and services from, and otherwise
to do business with, persons doing business with the General Partners or
their affiliates.  The General Partners and their affiliates may be in
competition with the Partnership under certain circumstances, including, in
certain geographical markets, for tenants and/or for the sale of property.
Because the timing and amount of cash distributions and profits and losses
of the Partnership may be affected by various determinations by the General
Partners under the Partnership Agreement, including whether and when to
sell a property, the establishment and maintenance of reasonable reserves,
the timing of expenditures and the allocation of certain tax items under
the Partnership Agreement, the General Partners may have a conflict of
interest with respect to such determinations.

     The names, positions held and length of service therein of each
director and the executive and certain other officers of the Managing
General Partner of the Partnership are as follows:



<PAGE>


                                                        SERVED IN
NAME                      OFFICE                        OFFICE SINCE
----                      ------                        ------------

Judd D. Malkin            Chairman                      5/03/71
                          Director                      5/03/71
                          Chief Financial Officer       2/22/96
Neil G. Bluhm             President                     5/03/71
                          Director                      5/03/71
Burton E. Glazov          Director                      7/01/71
Stuart C. Nathan          Executive Vice President      5/08/79
                          Director                      3/14/73
A. Lee Sacks              Director                      5/09/88
John G. Schreiber         Director                      3/14/73
H. Rigel Barber           Executive Vice President      1/02/87
                          Chief Executive Officer       8/01/93
Glenn E. Emig             Executive Vice President      1/01/93
                          Chief Operating Officer       1/01/95
Gary Nickele              Executive Vice President      1/01/92
                          General Counsel               2/27/84
Gailen J. Hull            Senior Vice President         6/01/88
Howard Kogen              Senior Vice President         1/02/86
                          Treasurer                     1/01/91

     There is no family relationship among any of the foregoing directors
or officers.  The foregoing directors have been elected to serve a one-year
term until the annual meeting of the Managing General Partner to be held on
June 3, 1998.  All of the foregoing officers have been elected to serve
one-year terms until the first meeting of the Board of Directors held after
the annual meeting of the Managing General Partner to be held on June 3,
1998.  There are no arrangements or understandings between or among any of
said directors or officers and any other person pursuant to which any
director or officer was elected as such.

     JMB is the corporate general partner of Carlyle Real Estate Limited
Partnership-VII ("Carlyle-VII"), Carlyle Real Estate Limited Partnership-XI
("Carlyle-XI"), Carlyle Real Estate Limited Partnership-XII
("Carlyle-XII"), Carlyle Real Estate Limited Partnership-XIII
("Carlyle-XIII"), Carlyle Real Estate Limited Partnership-XIV
("Carlyle-XIV"), Carlyle Real Estate Limited Partnership-XV ("Carlyle-XV"),
Carlyle Real Estate Limited Partnership-XVI ("Carlyle-XVI"), Carlyle Real
Estate Limited Partnership-XVII ("Carlyle-XVII"), JMB Mortgage Partners,
Ltd.-III ("Mortgage Partners-III"), JMB Mortgage Partners, Ltd.-IV
("Mortgage Partners-IV"), Carlyle Income Plus, Ltd. ("Carlyle Income Plus")
and Carlyle Income Plus, L.P.-II ("Carlyle Income Plus-II"), and the
managing general partner of JMB Income Properties, Ltd.-IV ("JMB
Income-IV"), JMB Income Properties, Ltd.-V ("JMB Income-V"), JMB Income
Properties, Ltd.-VII ("JMB Income-VII"), JMB Income Properties, Ltd.-X
("JMB Income-X"), JMB Income Properties, Ltd.-XI ("JMB Income-XI") and JMB
Income Properties, Ltd.-XIII ("JMB Income-XIII").  JMB is also the sole
general partner of the associate general partner of most of the foregoing
partnerships.  Most of the foregoing directors and officers are also
officer and/or directors of various affiliated companies of Arvida/JMB
Managers, Inc. (the general partner Arvida/JMB Partners, L.P. ("Arvida"))
and Income Growth Managers, Inc. (the corporate general partner of IDS/JMB
Balanced Income Growth, Ltd. ("IDS/BIG")).  Most of such directors and
officers are also partners, directly or indirectly, of certain partnerships
which are associate general partners in the following real estate limited
partnerships:  the Partnership, Carlyle-VII, Carlyle-XI, Carlyle-XII,
Carlyle-XIII, Carlyle-XIV, Carlyle-XV, Carlyle-XVI, Carlyle-XVII, JMB
Income-VI, JMB Income-VII, JMB Income-X, JMB Income-XI, JMB Income-XIII,
Mortgage Partners-III, Mortgage Partners-IV, Carlyle Income Plus, Carlyle
Income Plus-II and IDS/BIG.



<PAGE>


     The business experience during the past five years of each such
director and officer of the Managing General Partner of the Partnership in
addition to that described above is as follows:

     Judd D. Malkin (age 60) is an individual general partner of JMB
Income-IV and JMB Income-V.  Mr. Malkin has been associated with JMB since
October, 1969.  Mr. Malkin is also a director of Urban Shopping Centers,
Inc. ("USC, Inc."), an affiliate of JMB that is a real estate investment
trust in the business of owning, managing and developing shopping centers.
He is a Certified Public Accountant.

     Neil G. Bluhm (age 60) is an individual general partner of JMB
Income-IV and JMB Income-V.  Mr. Bluhm has been associated with JMB since
August, 1970.  Mr. Bluhm is also a principal of Walton Street Real Estate
Fund I, L.P. and a director of USC, Inc.  He is a member of the Bar of the
State of Illinois and a Certified Public Accountant.

     Burton E. Glazov (age 59) has been associated with JMB since June,
1971 and served as an Executive Vice President of JMB until December 1990.
He is a member of the Bar of the State of Illinois and a Certified Public
Accountant.

     Stuart C. Nathan (age 56) has been associated with JMB since July,
1972.  He is a member of the Bar of the State of Illinois.

     A. Lee Sacks (age 64) has been associated with JMB since December,
1972.  He is also the President and a director of JMB Insurance Agency,
Inc.

     John G. Schreiber (age 51) has been associated with JMB since
December, 1970 and served as an Executive Vice President of JMB until
December 1990.  Mr. Schreiber is President of Schreiber Investments, Inc.,
a company which is engaged in the real estate investing business.  He is
also a senior advisor and partner of Blackstone Real Estate Advisors, L.P.,
an affiliate of the Blackstone Group, L.P.  Mr. Schreiber is also a
director of USC, Inc., a trustee of Amli Residential Property Trust and a
director of a number of investment companies advised or managed by T. Rowe
Price Associates and its affiliates.  He holds a Masters degree in Business
Administration from Harvard University Graduate School of Business.

     H. Rigel Barber (age 48) has been associated with JMB since March,
1982. He holds a J.D. degree from the Northwestern Law School and is a
member of the Bar of the State of Illinois.

     Glenn E. Emig (age 50) has been associated with JMB since December,
1979.  Prior to becoming Executive Vice President of JMB in 1993, Mr. Emig
was Executive Vice President and Treasurer of JMB Institutional Realty
Corporation.  He holds a Masters Degree in Business Administration from the
Harvard University Graduate School of Business and is a Certified Public
Accountant.

     Gary Nickele (age 45) has been associated with JMB since February,
1984.  He holds a J.D. degree from the University of Michigan Law School
and is a member of the Bar of the State of Illinois.

     Gailen J. Hull (age 49) has been associated with JMB since March,
1982.  He holds a Masters degree in Business Administration from Northern
Illinois University and is a Certified Public Accountant.

     Howard Kogen (age 62) has been associated with JMB since March, 1973.
He is a Certified Public Accountant.




<PAGE>


ITEM 11.  EXECUTIVE COMPENSATION

     The Partnership has no officers or directors.  The General Partners of
the Partnership are entitled to receive a share of cash distributions, when
and as cash distributions are made to the Investors, and a share of profits
or losses.  Reference is also made to the Notes for a description of such
transactions, distributions and allocations.  No such cash distributions
were paid to the General Partners in 1997, 1996 and 1995.

     Affiliates of the Managing General Partner provided property
management services to the Partnership for 1997 for the Plaza Hermosa
Shopping Center in Hermosa Beach, California at a fee calculated at 4% of
the gross receipts of the property and for the 40 Broad Street office
building in New York, New York until December 1994 at a fee calculated at
2% of the gross receipts of the property.  In 1997, the affiliates earned
property management and leasing fees amounting to $79,670, all of which
were paid at December 31, 1997.  As set forth in the Prospectus of the
Partnership, the Managing General Partner must negotiate such agreements on
terms no less favorable to the Partnership than those customarily charged
for similar services in the relevant geographical area and such agreements
must be terminable by either party thereto, without penalty, upon 60 days'
notice.

     The General Partners of the Partnership may be reimbursed for their
salaries, salary-related and direct expenses relating to the administration
of the Partnership and the operation of the Partnership's real property
investments.  In 1997, the Managing General Partner received reimbursement
for such expenses and salaries in the amount of $75,981 of which $27,957
was unpaid at December 31, 1997.  The Managing General Partner received no
disbursement agent and data processing fees in 1997.

     JMB Insurance Agency, Inc., an affiliate of the Managing General
Partner of the Partnership, earned and received insurance brokerage
commissions in 1997 aggregating $22,214 in connection with the providing of
insurance coverage for the real property investments of the Partnership.
Such commissions are at rates set by insurance companies for the classes of
coverage involved.

     The Partnership is permitted to engage in various transactions
involving affiliates of the Managing General Partner of the Partnership.
The relationship of the Managing General Partner (and its directors and
officers) to its affiliates is set forth above in Item 10 above and Exhibit
21 hereto.



<PAGE>


<TABLE>
<CAPTION>
ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     (a) No person or group is known by the Partnership to own beneficially more than 5% of the outstanding
Interests of the Partnership.

     (b) The Managing General Partner, its officers and directors and the Associate General Partners own the
following Interests of the Partnership:

                             NAME OF                        AMOUNT AND NATURE
                             BENEFICIAL                     OF BENEFICIAL             PERCENT
TITLE OF CLASS               OWNER                          OWNERSHIP                 OF CLASS
--------------               ----------                     -----------------         --------
<S>                          <C>                            <C>                       <C>
Limited Partnership
  Interests and
  Assignee Interests
  Therein                    JMB Realty Corporation         5 Interests (1)           Less than 1%
                                                              indirectly

Limited Partnership
  Interests and
  Assignee Interests
  Therein                    Managing General Partner,      5 Interests (1)           Less than 1%
                             its officers and                 indirectly
                             directors and the
                             Associate General
                             Partners as a group

<FN>
     (1)  Includes 5 interests owned by the Initial Limited Partner of the Partnership for which JMB Realty
Corporation, as its indirect majority shareholder, is deemed to have sole voting and investment power.


     No officer or director of the Managing General Partner of the Partnership possesses a right to acquire
beneficial ownership of Interests of the Partnership.

     Reference is made to Item 10 for information concerning ownership of the Managing General Partner.

     (c)  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.


</TABLE>


<PAGE>


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     There were no significant transactions or business relationships with
the Managing General Partner, affiliates or their management other than
those described in Items 10 and 11 above.



                                PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K


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

             1.   Financial Statements (See Index to Financial Statements
filed with this annual report).

             2.   Exhibits.

                  3-A.  The Prospectus of the Partnership dated August
23, 1985 as supplemented December 9, 1985 and January 10, pursuant to Rules
424 (b) and 424 (c), as filed with the Commission is hereby incorporated
herein by reference.  Copies of pages 8-12, 61-64 and A-8 to A-12 are
hereby incorporated herein by reference to Exhibit 3-A to the Partnership's
Report on Form 10-K for December 31, 1992 (File No. 0-16108) dated March
19, 1993.

                  3-B.  Amended and Restated Agreement of Limited
Partnership set forth as Exhibit A to the Prospectus, which agreement is
hereby incorporated herein by reference to Exhibit 3-B to the Partnership's
Report on Form 10-K for December 31, 1992 (File No. 0-16108) dated March
19, 1993.

                  3-C.  Acknowledgement of rights and duties of the
General Partners of the Partnership between ABPP Associates, L.P. (a
successor Associated General Partner of the Partnership) and JMB Realty
Corporation as of December 31, 1995 is hereby incorporated herein by
reference to the Partnership's report for June 30, 1996 on Form 10-Q (File
No. 0-16108) dated August 9, 1996.

                  4-A.  Mortgage loan agreement between Topanga and
Connecticut General Life Insurance Company dated January 31, 1992 relating
to Topanga Plaza in Los Angeles, California is hereby incorporated herein
by reference to Exhibit 4-A to the Partnership's Report on Form 10-K for
December 31, 1992 (File No. 0-16108) dated March 19, 1993.

                  4-B.  Amended and restated mortgage loan agreement
between First Financial and The Prudential Insurance Company of America
dated November 21, 1995 relating to First Financial Plaza in Encino,
California is hereby incorporated herein by reference to the Partnership's
Report for December 31, 1995 on Form 10-K (File No. 0-16108) dated March
25, 1996.



<PAGE>


                  4-C.  Mortgage loan modification agreement between
Topanga and Connecticut General Life Insurance dated January 31, 1993
relating to Topanga Plaza in Los Angeles, California is hereby incorporated
herein by reference to Exhibit 4 of the Partnership's Report on Form 10-Q
(File No. 0-16108) dated November 11, 1993.

                  4-D.  Letter of credit agreement between JMB Income
Properties, Ltd-XII and Dresdner Bank AG dated November 15, 1994 relating
to the letter of credit extension at Plaza Hermosa is hereby incorporated
herein by reference to Exhibit 4-D of the Partnership's Report on Form 10-K
for December 31, 1994 (File No. 0-16108) dated March 27, 1995.

                  4-E.  Mortgage loan agreement, Amended and Restated
Deed of Trust, Security Agreement with assignment of Rents and Fixture
Filing and Real Estate tax escrow and Security Agreement between San Jose
and Connecticut General Life Insurance Co. dated November 30, 1994 is
hereby incorporated herein by reference to Exhibit 4-E to the Partnership's
Report on Form 10-K for December 31, 1994 (File No. 0-16108) dated March
27, 1995.

                  10-A. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of Topanga Plaza in
Los Angeles, California, are hereby incorporated by reference to the
Partnership's Report on Form 8-K (File No. 0-16108) dated December 31,
1985.

                  10-B. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of First Financial
Plaza in Encino, California are hereby incorporated by reference to the
Partnership's Report on Form 8-K (File No. 0-16108) dated June 3, 1987.

                  10-C. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of 40 Broad Street in
New York, New York, are hereby incorporated by reference to the
Partnership's Report on Form 8-K (File No. 0-16108) dated December 31,
1985.

                  10-D. Third Amendment to amended and restated
partnership agreement of JMB Encino Partnership L.P. dated April 24, 1996
between JMB First Financial Associates and JMB Encino Partnership are
hereby incorporated by reference to the Partnership's report on Form 10-Q
(File No. 0-16108) dated May 10, 1996.

                  10-E. Purchase Agreement and Amendments thereto dated
August 9, 1996 relating to the sale of First Financial Plaza by JMB Encino
Partnership, L.P. are hereby incorporated herein by reference to the
Partnership's report for September 11, 1996 on Form 8-K (File No. 0-16108)
dated September 26, 1996.



<PAGE>


                  10-F. Sale documents relating to the sale of the 40
Broad Street office building in New York, New York are hereby incorporated
by reference to the Partnership's report for December 30, 1997 on Form 8-K
(File No. 0-16108) dated January 14, 1998.

                  10-G. First Amendment to the Purchase-Sale Agreement
dated February 10, 1998 relating to the sale by San Jose of the Park Center
Financial Plaza office complex in San Jose, California between JMB/San Jose
Associates and Divco West Properties, LLC are filed herewith.

                  10-H. Purchase-Sale Agreement with exhibits dated
December 3, 1997 relating to the sale by San Jose of the Park Center
Financial Plaza office complex in San Jose, California between JMB/San Jose
Associates and Divco West Properties, LLC are filed herewith.

                  10-I. Purchase-Sale Agreement with amendments thereto
dated November 25, 1997 relating to the sale by the Partnership of the
Plaza Hermosa Shopping Center in Hermosa Beach, California between JMB
Income Properties, Ltd. - XII and Pacific Retail Trust are filed herewith.

                  21.   List of Subsidiaries

                  24.   Powers of Attorney

                  27.   Financial Data Schedule

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

        Although certain additional long-term debt instruments of the
Registrant have been excluded from Exhibit 4 above, pursuant to Rule
601(b)(4)(iii), the Registrant commits to provide copies of such agreements
to the Securities and Exchange Commissions upon request.

        (b)  The following report on Form 8-K was filed since the
beginning of the last quarter of the period covered by this report.

             The Partnership's report on Form 8-K (File No. 0-16108) for
December 30, 1997 dated January 14, 1998 describing under Item 2 the sale
of the 40 Broad Street office building was filed.

        No annual report or proxy material for 1997 has been sent to the
Partners of the Partnership.  An annual report will be sent to the Partners
subsequent to this filing.



<PAGE>


                              SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Act of 1934, the Partnership has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                JMB INCOME PROPERTIES, LTD. - XII

                By:     JMB Realty Corporation
                        Managing General Partner


                        GAILEN J. HULL
                By:     Gailen J. Hull
                        Senior Vice President
                Date:   March 25, 1998

     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.

                By:     JMB Realty Corporation
                        Managing General Partner

                        JUDD D. MALKIN*
                By:     Judd D. Malkin, Chairman and
                        Chief Financial Officer
                Date:   March 25, 1998

                        NEIL G. BLUHM*
                By:     Neil G. Bluhm, President and Director
                Date:   March 25, 1998

                        H. RIGEL BARBER*
                By:     H. Rigel Barber, Chief Executive Officer
                Date:   March 25, 1998

                        GLENN E. EMIG*
                By:     Glenn E. Emig, Chief Operating Officer
                Date:   March 25, 1998


                        GAILEN J. HULL
                By:     Gailen J. Hull, Senior Vice President
                        Principal Accounting Officer
                Date:   March 25, 1998

                        A. LEE SACKS*
                By:     A. Lee Sacks, Director
                Date:   March 25, 1998

                By:     STUART C. NATHAN*
                        Stuart C. Nathan, Executive Vice President
                          and Director
                Date:   March 25, 1998


                *By:    GAILEN J. HULL, Pursuant to a Power of Attorney


                        GAILEN J. HULL
                By:     Gailen J. Hull, Attorney-in-Fact
                Date:   March 25, 1998


<PAGE>


                   JMB INCOME PROPERTIES, LTD. - XII

                             EXHIBIT INDEX



                                                 DOCUMENT
                                              INCORPORATED
                                              BY REFERENCE    PAGE
                                              -------------   ----

3-A.      Pages 8-12, 61-64 and A-8 to A-12 of
          the Prospectus of the Partnership
          dated August 23, 1985, as supple-
          mented on December 9, 1985 and
          January 10, 1986                              Yes

3-B.      Amended and Restated Agreement of
          Limited Partnership                           Yes

3-C.      Acknowledgement of rights and duties
          of the General Partners of the
          Partnership dated August 9, 1996
          between ABPP Associates, L.P. and
          JMB Realty Corporation                        Yes

4-A.      Mortgage loan agreement related to
          Topanga Plaza                                 Yes

4-B.      Mortgage loan agreement related to
          First Financial Plaza                         Yes

4-C.      Mortgage loan modification agreement
          related to Topanga Plaza                      Yes

4-D.      Letter of credit agreement related to
          Plaza Hermosa                                 Yes

4-E.      Mortgage loan agreement related to
          Park Center Plaza                             Yes

10-A.     Acquisition documents related to
          Topanga Plaza                                 Yes

10-B.     Acquisition documents related to
          First Financial Plaza                         Yes

10-C.     Acquisition documents related to
          40 Broad Street                               Yes

10-D.     Third Amendment to amended and
          restated partnership agreement of
          JMB Encino Partnership L.P. dated
          April 24, 1996 between JMB First
          Financial Associates and JMB Encino
          Partnership                                   Yes

10-E.     Purchase Agreement and Amendments
          thereto dated August 9, 1996 relating
          to the sale of First Financial Plaza
          by JMB Encino Partnership, L.P.               Yes



<PAGE>


                                                 DOCUMENT
                                              INCORPORATED
                                              BY REFERENCE    PAGE
                                              -------------   ----

10-F.     Sale documents related to the
          40 Broad Street office building               Yes

10-G.     First Amendment to the Purchase-
          Sale Agreement related to the
          Park Center Financial Plaza
          office complex                                 No

10-H.     Purchase-Sale Agreement related
          to the Park Center Financial Plaza
          office complex                                 No

10-I.     Purchase-Sale Agreement with
          amendments thereto related to
          the Plaza Hermosa Shopping Center              No

21.       List of Subsidiaries                           No

24.       Powers of Attorney                             No

27.       Financial Data Schedule                        No