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

                                    FORM 10-K405

[x]  ANNUAL   REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For the fiscal year ended       December 31, 1995
                              --------------------------------------------------

                                       OR

[ ]  TRANSITION   REPORT  PURSUANT   TO   SECTION  13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

     For the transition period from ______________ to_____________

     Commission file number  0-9783
                           --------


                        McNEIL REAL ESTATE FUND XI, LTD.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


         California                                   94-2669577
--------------------------------------------------------------------------------
(State or other jurisdiction of                      (I.R.S. Employer
incorporation or organization)                        Identification No.)


             13760 Noel Road, Suite 700, LB70, Dallas, Texas, 75240
--------------------------------------------------------------------------------
              (Address of principal executive offices)       (Zip code)

Registrant's telephone number, including area code     (214)  448-5800
                                                   -----------------------------

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

Securities registered pursuant to Section 12(g) of the Act: Limited  partnership
                                                            units
----------------------------------------------------------

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,  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 ]

159,500  of the  registrant's  159,813  limited  partnership  units  are held by
non-affiliates  of this registrant.  The aggregate market value of units held by
non-affiliates  is not determinable  since there is no public trading market for
limited  partnership  units  and  transfers  of units  are  subject  to  certain
restrictions.

Documents Incorporated by Reference:        See Item 14, Page 38


                                TOTAL OF 41 PAGES

<PAGE>


                                     PART I
ITEM 1.      BUSINESS
-------      --------

ORGANIZATION
------------

McNeil Real Estate Fund XI, Ltd. (the  "Partnership") was organized June 2, 1980
as a limited  partnership under the provisions of the California Uniform Limited
Partnership Act. The general partner of the Partnership is McNeil Partners, L.P.
(the "General Partner"), a Delaware limited partnership,  an affiliate of Robert
A. McNeil  ("McNeil").  The  Partnership  is governed by an amended and restated
partnership  agreement of limited  partnership  dated August 6, 1991, as amended
(the  "Amended  Partnership  Agreement").  Prior  to  August  6,  1991,  Pacific
Investors  Corporation (the prior "Corporate General  Partner"),  a wholly-owned
subsidiary of Southmark Corporation  ("Southmark"),  and McNeil were the general
partners  of the  Partnership,  which was  governed by an  agreement  of limited
partnership dated June 2, 1980 (the "Original Partnership Agreement") as amended
August 29, 1980. The principal place of business for the Partnership and for the
General Partner is 13760 Noel Road, Suite 700, LB70, Dallas, Texas, 75240.

On  September  18,  1980,  a  Registration  Statement  on Form S-11 was declared
effective by the  Securities  and Exchange  Commission  whereby the  Partnership
offered for sale $80,000,000 of limited  partnership units ("Units").  The Units
represent equity interests in the Partnership and entitle the holders thereof to
participate in certain  allocations and  distributions of the  Partnership.  The
sale of Units closed on June 1, 1981,  with 160,000  Units sold at $500 each, or
gross  proceeds of  $80,000,000 to the  Partnership.  In addition,  the original
general partners  purchased a total of 140 Units for $70,000.  In 1993, 61 Units
were relinquished. An additional 162 and 104 Units were relinquished in 1994 and
1995, respectively, leaving 159,813 Units outstanding as of December 31, 1995.

SOUTHMARK BANKRUPTCY AND CHANGE IN GENERAL PARTNER
--------------------------------------------------

On July 14, 1989,  Southmark filed a voluntary petition for reorganization under
Chapter 11 of the U.S. Bankruptcy Code. Neither the Partnership,  McNeil nor the
Corporate   General   Partner   were   included  in  the   filing.   Southmark's
reorganization  plan became  effective  August 10, 1990. Under the plan, most of
Southmark's  assets,  which  included  Southmark's  interests  in the  Corporate
General Partner, are being sold or liquidated for the benefit of creditors.

In  accordance  with  Southmark's  reorganization  plan,  Southmark,  McNeil and
various of their affiliates  entered into an asset purchase agreement on October
12, 1990,  providing for, among other things,  the transfer of control to McNeil
or his affiliates of 34 limited partnerships  (including the Partnership) in the
Southmark portfolio.

On February 14,  1991,  pursuant to the asset  purchase  agreement as amended on
that date: (a) an affiliate of McNeil purchased the Corporate  General Partner's
economic  interest in the  Partnership;  (b) McNeil became the managing  general
partner of the Partnership  pursuant to an agreement with the Corporate  General
Partner that delegated  management  authority to McNeil;  (c) McNeil Real Estate
Management,  Inc.  ("McREMI"),  an  affiliate  of  McNeil,  acquired  the assets
relating to the property management and partnership  administrative  business of
Southmark  and its  affiliates  and commenced  management  of the  Partnership's
properties  pursuant  to an  assignment  of  the  existing  property  management
agreements from the Southmark affiliates;  and (d) the General Partner purchased
the  short-term,  unsecured  loan  owing  from the  Partnership  to a  Southmark
affiliate in the amount of $2,645,950.  The unsecured loan has now been  settled
in full.

<PAGE>

On August 6,  1991,  the  limited  partners  approved a  restructuring  proposal
providing for (i) the  replacement of the Corporate  General  Partner and McNeil
with  the  General  Partner;  (ii)  the  adoption  of  the  Amended  Partnership
Agreement, which substantially alters the provisions of the Original Partnership
Agreement  relating  to,  among other  things,  compensation,  reimbursement  of
expenses, and voting rights; and (iii) the approval of a new property management
agreement with McREMI, the Partnership's property manager.

The  Amended   Partnership   Agreement  provides  for  a  Management   Incentive
Distribution ("MID") to replace all other forms of general partner compensation,
other  than  property  management  fees and  reimbursements  of  certain  costs.
Additional  Units  may be  issued  in  connection  with the  payment  of the MID
pursuant  to  the  Amended  Partnership  Agreement.  See  Item  8  -  Note  2  -
"Transactions  with  Affiliates."  For  a  discussion  of  the  methodology  for
calculating and  distributing the MID, see Item 13 - Certain  Relationships  and
Related Transactions.

Settlement of Claims:

During 1990,  the  Partnership  filed claims in the Southmark  bankruptcy in the
amount of $1,180,040.  McNeil also filed claims on behalf of the  Partnership in
an  indeterminate  amount,  some of which  overlapped  in whole or in part  with
claims  filed  by the  Partnership.  No  claims  were  filed  by  McNeil  or the
Partnership on behalf of individual limited partners.

In July 1991, the United States  Bankruptcy  Court for the Northern  District of
Texas,  Dallas Division,  approved an agreement whereby the Partnership  settled
its claims against Southmark.  Under the settlement  agreement,  an affiliate of
McNeil  agreed  to waive on a  dollar-for-dollar  basis an  amount  equal to the
settled claims against affiliate advances owed by the Partnership, which at June
30, 1991, were in excess of the amount of the claim.  The reduction of affiliate
advances  resulted  in an  extraordinary  gain  on  extinguishment  of  debt  of
$1,180,040 in 1991.

CURRENT OPERATIONS
------------------

General:

The Partnership is engaged in real estate  activities,  including the ownership,
operation  and  management  of  residential  real  estate and other real  estate
related   assets.   At  December  31,   1995,   the   Partnership   owned  eight
income-producing properties as described in Item 2 - Properties.

The  Partnership  does not directly  employ any  personnel.  The  Partnership is
managed by the General Partner,  and, in accordance with the Amended Partnership
Agreement,  the  Partnership  reimburses  affiliates of the General  Partner for
certain cost incurred by affiliates  of the General  Partner in connection  with
the  management  of  the  Partnership's   business.  See  Item  8  -  Note  2  -
"Transactions with Affiliates."

The business of the Partnership to date has involved only one industry  segment.
See Item 8 - Financial Statements and Supplementary Data. The Partnership has no
foreign operations. The business of the Partnership is not seasonal.

<PAGE>

Business Plan:

The  Partnership's  anticipated  plan of  operations  for 1996 is to preserve or
increase the net operating income of its properties whenever possible,  while at
the same time making  whatever  capital  expenditures  are reasonable  under the
circumstances  in order to preserve  and enhance the value of the  Partnership's
properties.  The  General  Partner  is  evaluating  market  and  other  economic
conditions to determine the optimum time to commence an orderly  liquidation  of
the  Partnership's  properties  in  accordance  with the  terms  of the  Amended
Partnership  Agreement.  In  conjunction  therewith,  the General  Partner  will
continue to explore  potential  avenues to enhance the value of the Units in the
Partnership,  which may include, among other things, asset sales or refinancings
of the Partnership's properties which may result in distributions to the limited
partners.  See  Item 7 -  Management's  Discussion  and  Analysis  of  Financial
Condition and Results of Operations.

Competitive Conditions:

Since the  principal  business of the  Partnership  is to own and  operate  real
estate,  the Partnership is subject to all of the risks incident to ownership of
real estate and interests  therein,  many of which relate to the  illiquidity of
this type of  investment.  These  risks  include  changes  in  general  or local
economic conditions,  changes in supply or demand for competing properties in an
area,  changes in interest rates and  availability  of permanent  mortgage funds
which  may  render  the  sale  or  refinancing   of  a  property   difficult  or
unattractive, changes in real estate and zoning laws, increases in real property
tax rates and Federal or local  economic or rent  controls.  The  illiquidity of
real estate  investments  generally  impairs the ability of the  Partnership  to
respond  promptly  to  changed  circumstances.  The  Partnership  competes  with
numerous established companies, private investors (including foreign investors),
real estate investment trusts,  limited partnerships and other entities (many of
which have greater  resources than the Partnership) in connection with the sale,
financing  and  leasing  of  properties.  The  impact  of  these  risks  on  the
Partnership,   including   losses  from  operations  and   foreclosures  of  the
Partnership's  properties,  is described in Item 7 - Management's Discussion and
Analysis  of  Financial  Condition  and  Results  of  Operations.  See  Item 2 -
Properties  for  discussion  of  competitive  conditions  at  the  Partnership's
properties.

Other Information:

The environmental  laws of the federal government and of certain state and local
governments  impose  liability  on current  property  owners for the clean-up of
hazardous and toxic substances discharged on the property. This liability may be
imposed  without  regard  to the  timing,  cause or person  responsible  for the
release of such substances onto the property.  The Partnership  could be subject
to such liability in the event that it owns properties having such environmental
problems.  The Partnership has no knowledge of any pending claims or proceedings
regarding such environmental problems.

In August 1995, High River Limited  Partnership,  a Delaware limited partnership
controlled by Carl C. Icahn ("High River") made an unsolicited tender offer (the
"HR Offer") to purchase  from  holders of Units up to  approximately  45% of the
outstanding  Units of the  Partnership  for a purchase price of $63 per Unit. In
addition,   High  River  made  unsolicited   tender  offers  for  certain  other
partnerships controlled by the General Partner. The Partnership recommended that
the limited  partners  reject the HR Offer made with respect to the  Partnership
and not tender their Units  pursuant to the HR Offer.  The HR Offer  terminated,
after numerous extensions, on October 6, 1995. The General Partner believes that
as of February  29, 1996,  High River has  purchased  approximately  5.9% of the
outstanding Units pursuant to the HR Offer. In addition, all litigation filed by
High River,  Mr. Icahn and his  affiliates in  connection  with the HR Offer has
been dismissed without prejudice.

<PAGE>

ITEM 2.     PROPERTIES
-------     ----------

The  following  table sets forth the real  estate  investment  portfolio  of the
Partnership  at December 31, 1995.  The buildings and the land on which they are
located  are owned by the  Partnership  in fee,  subject in each case to a first
lien deed of trust as set forth more fully in Item 8 - Note 5 - "Mortgage  Notes
Payable".  See also Item 8 - Note 4 - "Real Estate Investments" and Schedule III
- "Real Estate  Investments  and  Accumulated  Depreciation."  In the opinion of
management, the properties are adequately covered by insurance.

<TABLE>
<CAPTION>

                                            Net Basis                            1995               Date
Property              Description           of Property          Debt         Property Tax        Acquired
--------              -----------           -----------          ----         ------------        --------
<S>                   <C>                 <C>               <C>               <C>                   <C> 
Acacia Lakes (1)      Apartments
Mesa, AZ              576 units           $    6,427,070    $    8,937,249    $      103,840        5/81

Gentle Gale (2)       Apartments
Galveston, TX         133 units                1,859,855         2,629,508            82,953        5/81

Knollwood (3)         Apartments
Kansas City, MO       315 units                2,455,810         4,472,878            71,798        5/81

The Park (4)          Apartments
Joplin, MO            192 units                1,333,802         2,604,482            20,746        3/81

Rock Creek            Apartments
Beaverton, OR         388 units                4,358,112         6,224,682           161,665        2/81

Sun Valley (5)        Apartments
Charlotte, NC         311 units                4,484,894         6,585,644           101,809        8/81

Villa Del Rio (6)     Apartments
Jacksonville, FL      444 units                4,366,232         5,634,662           164,411        5/81

The Village (7)       Apartments
Gresham, OR           152 units                1,966,056         2,595,335            92,495        5/81
                                           -------------      ------------       -----------
                                          $   27,251,831    $   39,684,440    $      799,717
                                           =============      ============       ===========
</TABLE>

-----------------------------------------
Total:    Apartments  -  2,511 units

(1)  Acacia  Lakes   Apartments  is  owned  by  Acacia  Lakes  Fund  XI  Limited
     Partnership which is wholly-owned by the Partnership.

(2)  Gentle Gale Apartments is owned by Gentle Gale Fund XI Limited  Partnership
     which is wholly-owned by the Partnership.

(3)  Knollwood  Apartments  is owned by Knollwood  Fund XI  Associates  which is
     wholly-owned by the Partnership and the General Partner.

<PAGE>

(4)  The  Park  Apartments  is owned by The  Park  Fund XI  Associates  which is
     wholly-owned by the Partnership and the General Partner.

(5)  Sun Valley  Apartments is owned by Sun Valley Fund XI  Associates  which is
     wholly-owned by the Partnership and the General Partner.

(6)  Villa  Del Rio  Apartments  is  owned  by  Villa  Del Rio  Fund XI  Limited
     Partnership which is wholly-owned by the Partnership.

(7)  The Village  Apartments  is owned by Village  Fund XI  Associates  which is
     wholly-owned by the Partnership and the General Partner.

The  following  table sets  forth the  properties'  occupancy  rate and rent per
square foot for each of the last five years:

<TABLE>
<CAPTION>

                                        1995            1994            1993           1992          1991
                                       -------         -------        -------        -------         ------
   <S>                                    <C>             <C>            <C>            <C>             <C>
Acacia Lakes
   Occupancy Rate............             96%             97%            98%            96%             88%
   Rent Per Square Foot......           $7.44           $6.64          $5.94          $5.16           $4.57

Gentle Gale
   Occupancy Rate............             88%             93%            98%           100%             94%
   Rent Per Square Foot......           $7.86           $7.83          $7.70          $7.25           $5.73

Knollwood
   Occupancy Rate............             96%             93%            98%            95%             90%
   Rent Per Square Foot......           $5.53           $5.17          $4.77          $4.56           $4.37

The Park
   Occupancy Rate............             90%             91%            93%            96%             90%
   Rent Per Square Foot......           $6.18           $6.23          $5.98          $5.46           $5.22

Rock Creek
   Occupancy Rate............             99%             94%            98%            96%             94%
   Rent Per Square Foot......           $7.91           $7.54          $7.25          $6.94           $6.46

Sun Valley
   Occupancy Rate............             97%             97%            87%            91%             88%
   Rent Per Square Foot......           $7.12           $6.51          $5.81          $5.78           $5.58

Villa Del Rio
   Occupancy Rate............            100%             98%            92%            88%             87%
   Rent Per Square Foot......           $5.46           $4.98          $4.87          $4.49           $4.39

The Village
   Occupancy Rate............            100%            100%            97%            98%             94%
   Rent Per Square Foot......           $7.96           $7.76          $7.52          $7.03           $6.62

</TABLE>

Occupancy rate  represents all units leased divided by the total number of units
of the  property  as of  December  31 of the given  year.  Rent per square  foot
represents all revenue, except interest,  derived from the property's operations
divided by the leasable square footage of the property.


<PAGE>

Competitive Conditions at Properties
------------------------------------

Due to a  substantial  investment  of  capital  since  1992,  Acacia  Lakes  has
increased   its  rent  per  square  foot  by  44%  over  the  last  four  years.
Additionally,  the  property  has  maintained  higher  occupancy  rates than the
average market rate of 93%.  Rental rates at Acacia Lakes are averaging $.62 per
square foot, while many competitors are averaging $.66 per square foot.

Gentle Gale is located in Galveston, Texas, where the local economy is dependent
upon the University of Texas Medical Branch and tourism. Over the last few years
the economy has been  sluggish  and this has been  reflected  in the drop in the
occupancy rates at the property.  Gentle Gale is currently  mirroring an average
market rate of 88%.  Gentle Gale  competes  with  properties  that are newer and
offer better  amenity  packages.  The property has been  upgrading the units and
offering rental discounts to remain competitive in the market.

Knollwood  finished 1995 just above the average  market rate of 95%. The current
rental  rates  per  square  foot are  between  $.52  and  $.55  for  Knollwood's
townhouses and one and two bedroom apartments,  while the market rate per square
foot is between $.52 and $.54.  Capital  improvements are planned to improve the
curb appeal and upgrade the  apartments  to take  advantage of the strong market
conditions.

The Park is the  largest  apartment  community  in  Joplin,  Missouri  where the
market's average  occupancy rate is 90%. The local economy is expected to remain
stable; however, during 1995, an additional 160 units were built which saturated
the apartment  market.  The new units are entering the  marketplace  at $.44 per
square  foot  while  The Park is  averaging  $.52 per  square  foot.  To  remain
competitive in the market, The Park has discounted rents.

Rock Creek is located in a strong rental market where the average occupancy rate
is 95% and the rent per square foot averages  $.72.  Over the past few years the
property has been  upgrading the interiors of the units as well as improving the
outside  appearance  with  landscaping  and a renovation  of the  clubhouse  and
office.  These  enhancements  allowed the  property to remain  competitive  with
rental  rates per square foot  averaging  $.66.  An  additional  3,300 units are
scheduled to be built in the market during 1996.  With the growth in employment,
the market should absorb these  additional  units without any adverse  effect to
the property.

Strong market conditions are beginning to stimulate new developments in the area
surrounding  Sun  Valley.   Currently,  an  additional  3,950  units  are  under
construction  with numerous  other  projects in the planning  stages.  These new
units will have no adverse effect on the property. With the capital improvements
made at the property over the last few years, the property has been able to stay
competitive with the newer properties. Sun Valley finished 1995 above the market
average occupancy rate of 96%.

Villa Del Rio's occupancy rate has increased by 13% since 1991 and finished 1995
above the market average of 94%. The overall occupancy rate for Jacksonville has
remained  strong.  The city experienced its highest level of new construction of
apartment communities since 1986. Currently,  3,000 units are under construction
with several other apartment communities in the planning stages. These new units
will have no adverse effect on the property.  Villa Del Rio's advantage over its
competitors  is design and layout of the  property.  All units are single  story
apartments and the property is spread over 25 acres.

<PAGE>

The Village  finished  the year fully  leased for the second year in a row.  The
area economy  remains  strong;  and  occupancy  rates were at their highest in 5
years. The market rental rate per square foot and the rental rate at The Village
is $.66. As a result of the strong  economy,  5,500 units were  absorbed  during
1995. The Village should remain competitive in the marketplace.

ITEM 3.     LEGAL PROCEEDINGS
-------     -----------------

1)   High River Limited Partnership v. McNeil Partners,  L.P., McNeil Investors,
     Inc., McNeil Pacific Investors 1972, Ltd., McNeil Real Estate Fund V, Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XIV, Ltd.,  McNeil Real
     Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real Estate
     Fund XXIV,  L.P.,  McNeil Real Estate Fund XXV, L.P.,  Robert A. McNeil and
     Carole J.  McNeil  (L95012) - High River  ("HR")  filed this  action in the
     United States District Court for the Southern  District of New York against
     McNeil Partners,  L.P., McNeil Investors,  Inc. and Mr. and Mrs. McNeil (as
     defined in this  Section 1,  collectively,  the  "Defendants")  requesting,
     among other  things,  names and  addresses  of the limited  partners in the
     partnerships   referenced   above  (as  defined  in  this  Section  1,  the
     "Partnerships"). The District Court issued a preliminary injunction against
     the Partnerships  requiring them to commence mailing materials  relating to
     the HR tender offer on August 14, 1995.

     On August 18, 1995, the Defendants  filed an Answer and  Counterclaim.  The
     Counterclaim  principally  asserts  (1)  the HR  tender  offers  have  been
     undertaken  in violation of the federal  securities  laws,  on the basis of
     material,  non-public,  and confidential  information,  and (2) that the HR
     offer documents omit and/or misrepresent certain material information about
     the HR tender offers.  The  Counterclaim  seeks a preliminary and permanent
     injunction   against  the   continuation  of  the  HR  tender  offers  and,
     alternatively,  ordering  corrective  disclosure  with respect to allegedly
     false and misleading statements contained in the tender offer documents.

     This action was dismissed without prejudice in November 1995.

2)   High River Limited Partnership v. McNeil Partners,  L.P., McNeil Investors,
     Inc., McNeil Pacific Investors 1972, Ltd., McNeil Real Estate Fund V, Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XIV, Ltd.,  McNeil Real
     Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real Estate
     Fund XXIV,  L.P.,  McNeil Real Estate Fund XXV, L.P.,  Robert A. McNeil and
     Carole J. McNeil - United States  District Court for the Southern  District
     of New York, (Case No. 95 Civ. 9488) (Second Action).

     On November 7, 1995, High River filed a second  complaint with the District
     Court which alleges, inter alia, that McNeil Partners, L.P.'s (the "General
     Partner")  Schedule  14D-9 filed in  connection  with the High River tender
     offers was materially false and misleading,  in violation of Sections 14(d)
     and 14(e) of the Securities Exchange Act of 1934, 15 U.S.C.  Section 78n(d)
     and (e),  and the SEC  Regulations  promulgated  thereunder;  and that High
     River further  alleges that the General  Partner has wrongfully  refused to
     admit High River as a limited  partner to the ten  partnerships  referenced
     above.  Additionally,  High River purports to assert claims derivatively on
     behalf of McNeil  Real Estate  Fund IX,  Ltd.,  McNeil Real Estate Fund XI,

<PAGE>

     Ltd.,  McNeil Real Estate Fund XV, Ltd., McNeil Real Estate Fund XXIV, L.P.
     and McNeil Real Estate Fund XXV, L.P., for breach of contract and breach of
     fiduciary  duty,  asserting  that the General  Partner  has  charged  these
     partnerships  excessive fees.  High River's  complaint  seeks,  inter alia,
     preliminary  injunctive  relief requiring the General Partner to admit High
     River as a limited partner in each of the ten partnerships referenced above
     and to transfer the tendered units of interest in the  partnerships to High
     River;  an  unspecified  award of  damages  payable  to High  River  and an
     additional   unspecified  award  of  damages  payable  to  certain  of  the
     partnerships;  an order that  defendants  must  discharge  their  fiduciary
     duties and must account for all fees they have received from certain of the
     partnerships; and attorneys' fees.

     On January 31, 1996, this action was dismissed without prejudice.

3)   Robert Lewis v. McNeil Partners,  L.P., McNeil  Investors,  Inc., Robert A.
     McNeil  et al - In the  District  Court of  Dallas  County,  Texas,  A-14th
     Judicial  District,  Cause No. 95-08535 (Class Action) - Plaintiff,  Robert
     Lewis, is a limited partner with McNeil Pacific  Investors Fund 1972, Ltd.,
     McNeil Real Estate Fund X, Ltd. and McNeil Real Estate Fund XV, Ltd.

     Plaintiff  brings  this  action on his own behalf and as a class  action on
     behalf of the class of all  limited  partners of McNeil  Pacific  Investors
     Fund 1972, Ltd.,  McNeil Real Estate Fund V, Ltd.,  McNeil Real Estate Fund
     IX,  Ltd.,  McNeil Real  Estate  Fund X, Ltd.,  McNeil Real Estate Fund XI,
     Ltd.,  McNeil Real Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd.,
     McNeil Real Estate Fund XX,  L.P.,  McNeil Real Estate Fund XXIV,  L.P. and
     McNeil  Real  Estate  Fund XXV,  Ltd.  (as  defined in this  Section 3, the
     "Partnerships") as of August 4, 1995.

     Plaintiff  alleges that McNeil  Partners,  L.P.,  McNeil  Investors,  Inc.,
     Robert A. McNeil and other  senior  officers (as defined in this Section 3,
     collectively,  the "Defendants")  breached their fiduciary duties by, among
     other things,  (1) failing to attempt to sell the  properties  owned by the
     Partnerships (as defined in this Section 3, the "Properties") and extending
     the lives of the Partnerships  indefinitely,  contrary to the Partnerships'
     business plans, (2) paying  distributions to themselves and generating fees
     for their affiliates, (3) refusing to make significant distributions to the
     class members,  despite the fact that the  Partnerships  have positive cash
     flows and  substantial  cash  balances,  and (4)  failing  to take steps to
     create an auction market for equity interests of the Partnerships,  despite
     the fact that a third party bidder filed  tender  offers for  approximately
     forty-five   percent  (45%)  of  the  outstanding  units  of  each  of  the
     Partnerships.  Plaintiff  also claims that  Defendants  have  breached  the
     partnership  agreements  of the  Partnerships  by  failing to take steps to
     liquidate  the  Properties  and by their  alteration  of the  Partnerships'
     primary  purposes,  their acts in  contravention of these  agreements,  and
     their use of the assets of the  Partnerships  for their own benefit instead
     of for the benefit of the Partnerships.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend this action.

<PAGE>

4)   James F.  Schofield,  Gerald C.  Gillett  and Donna S.  Gillett  v.  McNeil
     Partners,  L.P.,  McNeil Investors,  Inc.,  McNeil Real Estate  Management,
     Inc., Robert A. McNeil,  Carole J. McNeil, McNeil Real Estate Fund V, Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XIV, Ltd.,  McNeil Real
     Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real Estate
     Fund XXIV,  L.P.,  McNeil Real Estate Fund XXV, L.P. et al - Superior Court
     of the State of California for the County of Los Angeles, Case No. BC133799
     (Class and Derivative  Action  Complaint) and United States District Court,
     Southern  District of New York, Case No.  95CIV.6711  (Class and Derivative
     Action Complaint)

     These are  corporate/securities  class and  derivative  actions  brought in
     state and federal court by limited partners of each of the nine (9) limited
     partnerships  that are named as  nominal  defendants  as  listed  above (as
     defined in this  Section 4, the  "Partnerships").  Plaintiffs  allege  that
     McNeil Investors,  Inc., its affiliate McNeil Real Estate Management,  Inc.
     and four (4) of their senior officers and/or  directors (as defined in this
     Section 4,  collectively,  the "Defendants")  have breached their fiduciary
     duties.  Specifically,  Plaintiffs  allege that  Defendants have caused the
     Partnerships  to enter  into  several  wasteful  transactions  that have no
     business  purpose or benefit to the  Partnerships  and which have  rendered
     such units highly illiquid and  artificially  depressed the prices that are
     available for units on the limited  resale market.  Plaintiffs  also allege
     that  Defendants  have  engaged  in a course  of  conduct  to  prevent  the
     acquisition of units by Carl Icahn by disseminating  false,  misleading and
     inadequate  information.  Plaintiffs  further allege that  Defendants  have
     acted to  advance  their  own  personal  interests  at the  expense  of the
     Partnerships' public unit holders by failing to sell Partnership properties
     and  failing  to make  distributions  to  unitholders  and,  thereby,  have
     breached the partnership agreements.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend these actions.

5)   Alfred Napoletano v. McNeil Partners, L.P., McNeil Investors,  Inc., Robert
     A. McNeil,  Carole J. McNeil,  McNeil Pacific  Investors  Fund 1972,  Ltd.,
     McNeil Real Estate Fund V, Ltd.,  McNeil Real Estate Fund IX, Ltd.,  McNeil
     Real Estate Fund X, Ltd.,  McNeil  Real Estate Fund XI,  Ltd.,  McNeil Real
     Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd., McNeil Real Estate
     Fund XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund
     XXV,  L.P.  -  Superior  Court of the  State of  California,  County of Los
     Angeles, Case No. BC133849 (Class Action Complaint)

     Plaintiff  brings this class action on behalf of a class of all persons and
     entities who are current owners of units and/or are limited partners in one
     or more of the partnerships referenced above (as defined in this Section 5,
     the "Partnerships").  Plaintiff alleges that McNeil Partners,  L.P., McNeil
     Investors,  Inc., Robert A. McNeil and other senior officers (as defined in
     this  Section  5,  collectively,  the  "Defendants")  have  breached  their
     fiduciary  duties to the class members by, among other  things,  (1) taking
     steps to prevent the  consummation  of the High River  tender  offers,  (2)
     failing to take steps to maximize unitholders' or limited partners' values,
     including  failure to liquidate the properties  owned by the  Partnerships,
     (3) managing the Partnerships so as to extend  indefinitely the present fee
     arrangements,  and (4) paying itself and entities  owned and  controlled by
     the  general  partner  excessive  fees and  reimbursements  of general  and
     administrative expenses.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend this action.

<PAGE>

6)   Warren Heller v. McNeil Partners,  L.P., McNeil Investors,  Inc., Robert A.
     McNeil,  Carole J. McNeil, McNeil Pacific Investors Fund 1972, Ltd., McNeil
     Real Estate Fund V, Ltd.,  McNeil  Real Estate Fund IX,  Ltd.,  McNeil Real
     Estate Fund X, Ltd.,  McNeil Real Estate Fund XI, Ltd.,  McNeil Real Estate
     Fund XIV, Ltd.,  McNeil Real Estate Fund XV, Ltd.,  McNeil Real Estate Fund
     XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund XXV,
     L.P. - Superior  Court of the State of  California,  County of Los Angeles,
     Case No. BC133957 (Class Action Complaint)

     Plaintiff  brings this class action on behalf of a class of all persons and
     entities who are current owners of units and/or are limited partners in one
     or more of the partnerships referenced above (as defined in this Section 6,
     the "Partnerships").  Plaintiff alleges that McNeil Partners,  L.P., McNeil
     Investors,  Inc., Robert A. McNeil and other senior officers (as defined in
     this  Section  6,  collectively,  the  "Defendants")  have  breached  their
     fiduciary  duties to the class members by, among other  things,  (1) taking
     steps to prevent the  consummation  of the High River  tender  offers,  (2)
     failing to take steps to maximize unitholders' or limited partners' values,
     including  failure to liquidate the properties  owned by the  Partnerships,
     (3) managing the Partnerships so as to extend  indefinitely the present fee
     arrangements,  and (4) paying itself and entities  owned and  controlled by
     the  general  partner  excessive  fees and  reimbursements  of general  and
     administrative expenses.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend this action.

For a discussion of the Southmark bankruptcy, See Item 1 - Business - "Southmark
Bankruptcy and Change in General Partner."

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

None.

                                     PART II

ITEM 5.      MARKET FOR THE REGISTRANT'S UNITS OF LIMITED PARTNERSHIP AND 
-------      ------------------------------------------------------------
             RELATED SECURITY HOLDER MATTERS
             -------------------------------

(A)  There is no  established  public  trading  market for  limited  partnership
     units, nor is one expected to develop.

(B)  Title of Class                             Number of Record Unit Holders
     --------------                             -----------------------------

     Limited partnership units                  8,674 as of February 16, 1996

(C)  No distributions were made to the limited partners during 1995 or 1994, and
     none are  anticipated for 1996. The Partnership  accrued  distributions  of
     $871,503 and $769,448 for the benefit of the General  Partner for the years
     ended  December 31, 1995 and 1994,  respectively.  Total  distributions  of
     $2,449,555 remain unpaid at December 31, 1995. These  distributions  relate
     to the  contingent  portion of the MID pursuant to the Amended  Partnership
     Agreement. See Item 8 - Note 2 - "Transactions with Affiliates." See Item 7
     - Management's  Discussion and Analysis of Financial  Condition and Results
     of Operations for a discussion of  distributions  and the  likelihood  that
     they will be resumed to the limited partners.

<PAGE>

ITEM 6. SELECTED FINANCIAL DATA
------- -----------------------

The  following  table sets forth a summary  of  certain  financial  data for the
Partnership.  This summary should be read in conjunction with the  Partnership's
financial statements and notes thereto appearing in Item 8.

<TABLE>
<CAPTION>


Statements of                                               Years Ended December 31,
Operations                              1995           1994            1993           1992           1991
------------------                  -------------  -------------  --------------  -------------  -------------
<S>                                 <C>            <C>            <C>             <C>            <C>          
Rental revenue.................     $  14,304,055  $  13,313,091  $   12,527,359  $  11,621,595  $  10,906,110
Total revenue..................        14,451,813     13,425,413      12,757,233     11,970,421     11,176,171
Loss on disposition of 
 of real estate................                 -              -               -              -     (2,600,856)
Income (loss) before
 extraordinary items...........           307,243       (193,822)     (1,038,150)    (1,316,607)    (5,541,822)
Extraordinary items............                 -              -        (521,380)        86,660      3,984,010
Net income (loss)..............           307,243       (193,822)     (1,559,530)    (1,229,947)    (1,557,812)


Net income (loss)
 per limited
partnership unit:
Income (loss) before
 extraordinary items...........     $        1.83  $       (3.98) $        (6.16) $       (7.81)  $    (33.52)
Extraordinary items............                 -              -           (3.22)           .51         24.33
                                     ------------   ------------   -------------   ------------    ----------
Net income (loss)..............     $        1.83  $       (3.98) $        (9.38) $       (7.30)  $     (9.19)
                                     ============   ============   =============   ============    ==========


                                                            As of December 31,
Balance Sheets                          1995           1994            1993           1992           1991
--------------                      -------------  -------------  --------------  -------------  ------------

Real estate investments, net...     $  27,251,831  $  27,916,213  $   28,103,619  $   28,192,464  $29,330,188
Total assets...................        32,508,764     33,355,998      34,963,327      31,779,500   33,463,444
Mortgage notes payable, net....        39,684,440     40,090,432      40,463,926      33,292,396   33,746,137
Partners' deficit..............       (11,323,378)   (10,759,568)     (9,796,298)     (7,611,239)  (5,942,739)
</TABLE>

See Item 7 -  Management's  Discussion  and Analysis of Financial  Condition and
Results of Operations.  Woodhill Mall Shopping  Center,  previously owned by the
Partnership, was foreclosed on by the lender during March 1991.

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

FINANCIAL CONDITION
-------------------

The  Partnership  was formed to  acquire,  operate and  ultimately  dispose of a
portfolio of  income-producing  real  properties.  As of December 31, 1995,  the
Partnership  owned  eight  apartment   properties.   All  of  the  Partnership's
properties are subject to mortgage notes.

<PAGE>

RESULTS OF OPERATIONS
---------------------

1995 compared to 1994

Revenue:

Total Partnership revenues for 1995 increased by $1,026,400 or 8% as compared to
1994. Rental revenue and interest income increased $990,964 or 7% and $63,545 or
75%,  respectively.  In 1994, the  Partnership  recognized a gain on involuntary
conversion of $28,109 as a result of a fire at Sun Valley in 1993.

Rental revenue for 1995 was  $14,304,055  as compared to  $13,313,091  for 1994.
This  increase of $990,964 is due to an increase in the rental rates at seven of
the Partnership's eight properties and increases in the occupancy rates at three
of the  Partnership's  properties.  Of the three  properties that experienced an
increase in their occupancy  rate, Rock Creek showed the largest  increase of 5%
from 94% at December 31, 1994 to 99% at December 31, 1995.  This increase can be
attributed  to the capital  improvements  made at the property over the last two
years.

Expenses:

Total  Partnership  expenses  increased  by  $525,335  or 4% for the year  ended
December 31, 1995 as compared to 1994.

Depreciation  expense increased $142,940 or 6% in 1995 as compared to 1994. This
increase is due to capital improvements made at the properties. During 1995, the
Partnership made $1,820,043 in capital improvements.

Property taxes decreased $98,679 or 11% in 1995 as compared to 1994. This is due
to an decrease in the estimated tax  liability at Gentle Gale,  Knollwood,  Rock
Creek, Sun Valley and The Park.

Repairs and maintenance increased by $128,072 or 8% in 1995 as compared to 1994.
This   increase  can  be   attributed   to  increases  in  ground   maintenance,
exterminating,  carpet  cleaning and sheet rock  repairs.  Additionally,  carpet
replacements,  which met the Partnership's  criteria for capitalization based on
the magnitude of replacements in 1994, were in part expensed for 1995.

General  and  administrative  increased  $242,009 or 160% in 1995 as compared to
1994.  This increase was due to costs  incurred by the  Partnership in the third
quarter of 1995 to evaluate and disseminate information regarding an unsolicited
tender offer. See Item 8 - Note 8 - "Legal Proceedings."

General  and  administrative  -  affiliates  increased  $30,441 or 7% in 1995 as
compared to 1994.  This is due to an increase in  reimbursements  to  affiliates
because of fewer partnerships over which overhead costs are allocated.

1994 compared to 1993

Revenue:

Total  Partnership  revenues for 1994 increased by $668,180 or 5% as compared to
1993. Rental revenue and interest income increased $785,732 or 6% and $32,799 or
64%,  respectively.  In 1994, the  Partnership  recognized a gain on involuntary
conversion  of $28,109 as  compared to $178,460 in 1993 as a result of a fire at
Sun Valley in 1993.

<PAGE>

Rental revenue for 1994 was  $13,313,091  as compared to  $12,527,359  for 1993.
This  increase of  $785,732 is due to an increase in the rental  rates at all of
the  Partnership's  properties and increases in the occupancy  rates at three of
the  Partnership's  properties.  Of the three  properties  that  experienced  an
increase in their occupancy rate, Sun Valley showed the largest  increase of 10%
from 87% at December 31, 1993 to 97% at December 31, 1994.  This increase can be
attributed  to the capital  improvements  made at the  property  during 1994 and
1993.

Expenses:

Total Partnership  expenses decreased $176,148 or 1% for the year ended December
31, 1994 as compared to 1993.

Interest expense - affiliates decreased by $142,055 in 1994 as compared to 1993.
This was due to the  repayment of all  affiliate  advances  and  mortgage  loans
during 1994 and 1993.

Depreciation expense increased $261,626 or 13% in 1994 as compared to 1993. This
increase is due to additional  capital  improvements at the  properties.  During
1994, the Partnership made $2,154,079 in capital improvements.

Expenses for property taxes, personnel,  repairs and maintenance,  utilities and
other  property  operating  expenses  increased  $28,431 for 1994 as compared to
1993.  Personnel  expenses increased by $75,171 as a result of hiring additional
leasing  personnel at Gentle Gale, The Village and Villa Del Rio and maintenance
personnel  at Acacia  Lakes,  Knollwood,  Rock  Creek  and Villa Del Rio.  Other
property operating expenses increased by $40,040 in 1994 as compared to 1993 due
to an increase in cleaning  and painting at Acacia  Lakes and  Knollwood.  These
increases  were  somewhat  offset by a decline in  repairs  and  maintenance  of
$90,989.  This  decrease is due to the  reduction  in the need for  interior and
exterior repairs due to the significant  amount of capital  improvements made at
the properties during 1994, 1993 and 1992.

Property  management  fees -  affiliates  increased  by $46,236 or 7% in 1994 as
compared to 1993. This increase is due to the increase in the rental receipts at
the properties, the basis for computing such fees.

General and administrative expense decreased $173,858 or 53% in 1994 as compared
to the same period in 1993.  These  decreases are due to savings the Partnership
achieved  through a new tax  processing  and reporting  system and reductions in
legal and professional fees.

General and  administrative  -  affiliates  decreased  $49,344 or 10% due to the
elimination of the fixed portion of the MID effective  July 1993.  This decrease
due to the elimination of the fixed portion of the MID was somewhat offset by an
increase in  reimbursements  to affiliates due to fewer  partnerships over which
the overhead costs are allocated.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

The Partnership has experienced positive cash flow from operations of $5,967,767
for the three years ended  December  31,  1995.  During  1993,  the  Partnership
received net cash proceeds of $6,760,884  for the  refinancing  of Acacia Lakes,
Gentle Gale and Villa Del Rio. The Partnership also received  insurance proceeds
of  $305,254  from the 1993 fire at Sun  Valley  and  $50,000  in  advances  and
mortgage notes from  affiliates.  Over the last three years, the Partnership has
used cash to fund $6,063,822 in additions to real estate investments, $1,322,129
in principal  payments,  $991,326 for  additions  to deferred  borrowing  costs,
$3,067,817 for the repayment of advances and mortgage notes from  affiliates and
$567,142 for the payment of the contingent portion of the MID.

<PAGE>

The Partnership  generated  $2,345,896  through operating  activities in 1995 as
compared to $3,155,585 in 1994.  This decrease can be attributed to the increase
in the cash paid to affiliates for Partnership administrative expenses which had
previously  been  deferred as well as an increase in the cash paid to  suppliers
during 1995.  These cash changes were  somewhat  offset by an increase in tenant
receipts as a result of the increased rental rates at seven of the Partnership's
properties.

The Partnership  generated  $3,155,585  through operating  activities in 1994 as
compared to $466,286 in 1993. This increase can be attributed to the increase in
cash received from tenants as a result of the increase in rental rates at all of
the  properties as well as the reduction in the amount paid to suppliers  during
1994.  Property  taxes paid  decreased  in 1994 as  compared  to 1993 due to the
original escrow deposits required as a result of the 1993 refinancings. Interest
paid to  affiliates  declined  in 1994 due to the  repayment  of the  affiliated
advances in January 1994.

The  Partnership has funded  $6,063,822 in additions to real estate  investments
over  the last  three  years.  The  expenditures  are  necessary  to  allow  the
Partnership's   aging  properties  to  maintain  their  appeal  to  current  and
prospective tenants.

In  1993,  the  Partnership   received  net  cash  proceeds  of  $6,760,884  for
refinancing  the  mortgage  notes on three of it  properties.  This  enabled the
Partnership to repay  $2,131,440 in advances and mortgage notes from  affiliates
in 1993 and $936,377 in advances from affiliates in 1994. The  Partnership  also
paid the General Partner the Contingent MID in 1993 and 1994.

Short-term liquidity:

The Partnership expended  considerable  resources during the past three years to
restore its properties to good operating condition. These expenditures have been
necessary  to  maintain  the  competitive  position of the  Partnership's  aging
properties in each of their markets.  The capital  improvements  made during the
past three years have enabled the  Partnership  to increase its rental  revenues
and reduce certain of its repairs and maintenance expenses.  The Partnership has
budgeted an  additional  $1.3 million of capital  improvements  for 1996,  to be
funded from property operations and cash reserves.

At  December  31,  1995,  the  Partnership  held  cash and cash  equivalents  of
$2,030,544.  The General  Partner  considers  this level of cash  reserves to be
adequate  to  meet  the  Partnership's  operating  needs.  The  General  Partner
anticipates  resuming MID payments if the Partnership's  properties  continue to
perform as projected.  The General Partner believes that  anticipated  operating
results for 1996 will be sufficient to fund the  Partnership's  budgeted capital
improvements  for 1996 and to repay the  current  portion  of the  Partnership's
mortgage notes.

During 1996, the  Partnership  is faced with a mortgage  maturity on The Village
totaling  approximately  $2,564,000.  It is  management's  policy  to  negotiate
extensions or arrange refinancings for the mortgage notes due.

The General  Partner has  established a revolving  credit facility not to exceed
$5,000,000 in the aggregate  which is available on a "first-come,  first-served"
basis to the Partnership and other affiliated partnerships if certain conditions
are met. Borrowings under the facility may be used to fund deferred maintenance,
refinancing  obligations and working  capital needs.  The Partnership has repaid
all the advances received from this facility, and there is no assurance that the
Partnership will receive  additional funds under the facility because no amounts
will be  reserved  for any  particular  partnership.  As of December  31,  1995,
$2,662,819  remained  available  for  borrowing  under  the  facility;  however,
additional funds could become available as other  partnerships repay borrowings.
This commitment will terminate on August 6, 1996.

<PAGE>

Long-term liquidity:

For the long term,  property operations will remain the primary source of funds.
While the present outlook for the Partnership's  liquidity is favorable,  market
conditions may change and property  operations can  deteriorate.  In that event,
the Partnership  would require other sources of working  capital.  No such other
sources have been  identified,  and the Partnership has no established  lines of
credit.  Other possible actions to resolve working capital  deficiencies include
refinancing or  renegotiating  terms of existing loans,  deferring major capital
expenditures on Partnership properties except where improvements are expected to
enhance the  competitiveness  or marketability  of the properties,  or arranging
working capital support from affiliates. All or a combination of these steps may
be  inadequate  or  unfeasible  in  resolving  such  potential  working  capital
deficiencies.  Affiliate  support has been required in the past, but there is no
assurance  that  support  would be  provided in the  future,  since  neither the
General  Partner nor any affiliates have any obligation in this regard in excess
of the $5,000,000 revolving credit facility discussed above.

Income allocation and distributions:

Terms  of  the  Amended   Partnership   Agreement  specify  that  income  before
depreciation is allocated to the General Partner to the extent of Contingent MID
paid in cash.  Depreciation  is  allocated  in the ratio of 95:5 to the  limited
partners and the General  Partner,  respectively.  Therefore, for the three year
period ended December 31, 1995, $15,362, $442,961, and $(57,121),  respectively,
were allocated to the General Partner. The limited partners received allocations
of net income (loss) of $291,881, $(636,783) and $(1,502,409) for the three year
period ended December 31, 1995, respectively.

With the exception of the MID,  distributions  to partners  have been  suspended
since 1986 as part of the General Partner's policy of maintaining  adequate cash
reserves.  Distributions  to the limited  partners will remain suspended for the
foreseeable  future.  The  General  Partner  will  continue  to monitor the cash
reserves and working  capital needs of the  Partnership  to determine  when cash
flows will support  distributions  to the limited  partners.  A distribution  of
$871,053  for the MID has been  accrued  by the  Partnership  for the year ended
December 31, 1995 for the General Partner.


<PAGE>

ITEM 8.      FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
-------      -------------------------------------------

<TABLE>
<CAPTION>
                                                                     Page
                                                                     Number
                                                                     ------

INDEX TO FINANCIAL STATEMENTS
-----------------------------

Financial Statements:

   <S>                                                                <C>
   Report of Independent Public Accountants................           17

   Balance Sheets at December 31, 1995 and 1994............           18

   Statements of Operations for each of the three years 
     in the period ended December 31, 1995.................           19

   Statements of Partners' Deficit for each of the
      three years in the period ended December 31, 1995....           20

   Statements of Cash Flows for each of the three years 
     in the period ended December 31, 1995.................           21

   Notes to Financial Statements...........................           23

   Financial Statement Schedule -

      Schedule III - Real Estate Investments and
        Accumulated Depreciation...........................           33

</TABLE>





















All other  schedules are omitted because they are not applicable or the required
information is shown in the financial statements or notes thereto.

<PAGE>



                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Partners of
McNeil Real Estate Fund XI, Ltd.:

We have audited the  accompanying  balance sheets of McNeil Real Estate Fund XI,
Ltd. (a California  limited  partnership)  as of December 31, 1995 and 1994, and
the related statements of operations,  partners' deficit and cash flows for each
of the three  years in the period  ended  December  31,  1995.  These  financial
statements  and the  schedule  referred to below are the  responsibility  of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements and the schedule based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the  financial  position of McNeil Real Estate Fund XI,
Ltd. as of December 31, 1995 and 1994, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 1995, in
conformity with generally accepted accounting principles.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial  statements  taken as a whole.  The  schedule  listed  in the index to
financial  statements is presented for purposes of complying with the Securities
and  Exchange  Commission's  rules  and  is not  part  of  the  basic  financial
statements.  This schedule has been subjected to the auditing procedures applied
in our audits of the basic  financial  statements  and, in our  opinion,  fairly
states in all material  respects  the  financial  data  required to be set forth
therein in relation to the basic financial statements taken as a whole.


/s/  Arthur Andersen LLP



Dallas, Texas
   March 13, 1996


<PAGE>
                        McNEIL REAL ESTATE FUND XI, LTD.

                                 BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                 December 31,
                                                                       -----------------------------------
                                                                            1995                 1994
                                                                       ---------------      --------------
ASSETS
------
   <S>                                                                 <C>                  <C>           
Real estate investments:
   Land.....................................................           $     5,938,464      $    5,938,464
   Buildings and improvements...............................                58,408,551          56,588,508
                                                                        --------------       -------------
                                                                            64,347,015          62,526,972
   Less:  Accumulated depreciation..........................               (37,095,184)        (34,610,759)
                                                                        --------------       -------------
                                                                            27,251,831          27,916,213

Cash and cash equivalents...................................                 2,030,544           1,932,351
Cash segregated for security deposits.......................                   386,125             363,849
Accounts receivable.........................................                    31,327              24,577
Prepaid expenses and other assets...........................                   276,785             361,909
Escrow deposits.............................................                   904,523             983,972
Deferred borrowing costs, net of accumulated
   amortization of $507,241 and $361,743 at
   December 31, 1995 and 1994, respectively.................                 1,627,629           1,773,127
                                                                        --------------       -------------
                                                                       $    32,508,764      $   33,355,998
                                                                        ==============       =============
LIABILITIES AND PARTNERS' DEFICIT
---------------------------------

Mortgage notes payable, net.................................           $    39,684,440      $   40,090,432
Accounts payable............................................                    62,056             112,735
Accrued interest............................................                   302,329             240,267
Accrued expenses............................................                   456,984             318,628
Deferred gain...............................................                    67,016              67,016
Payable to affiliates - General Partner.....................                 2,851,851           2,919,444
Security deposits and deferred rental income................                   407,466             367,044
                                                                        --------------       -------------
                                                                            43,832,142          44,115,566
                                                                        --------------       -------------


Partners' deficit:
   Limited partners - 159,813 and 159,917 limited
     partnership units issued and outstanding at
     December 31, 1995 and 1994, respectively...............                (4,983,492)         (5,275,373)
   General Partner..........................................                (6,339,886)         (5,484,195)
                                                                        --------------       -------------
                                                                           (11,323,378)        (10,759,568)
                                                                        --------------       -------------
                                                                       $    32,508,764      $   33,355,998
                                                                        ==============       =============
</TABLE>



                 See accompanying notes to financial statements.


<PAGE>
                        McNEIL REAL ESTATE FUND XI, LTD.

                            STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                          For the Years Ended December 31,
                                                   ----------------------------------------------------
                                                        1995               1994               1993
                                                   --------------     --------------    ---------------
<S>                                                <C>                <C>               <C>            
Revenue:
   Rental revenue..........................        $   14,304,055     $   13,313,091    $    12,527,359
   Interest................................               147,758             84,213             51,414
   Gain on involuntary conversion..........                     -             28,109            178,460
                                                    -------------      -------------     --------------
     Total revenue.........................            14,451,813         13,425,413         12,757,233
                                                    -------------      -------------     --------------

Expenses:
   Interest................................             3,905,403          3,901,700          4,048,884
   Interest - affiliates...................                     -              3,589            145,644
   Depreciation............................             2,484,425          2,341,485          2,079,859
   Property taxes..........................               799,717            898,396            907,597
   Personnel expenses......................             1,722,218          1,741,104          1,665,933
   Repairs and maintenance.................             1,718,236          1,590,164          1,681,153
   Property management fees -
     affiliates............................               711,435            671,785            625,549
   Utilities...............................             1,044,938          1,003,419            990,009
   Other property operating expenses.......               899,517            881,362            841,322
   General and administrative..............               393,663            151,654            325,512
   General and administrative -
     affiliates............................               465,018            434,577            483,921
                                                    -------------      -------------     --------------
     Total expenses                                    14,144,570         13,619,235         13,795,383
                                                    -------------      -------------     --------------

Income (loss) before extraordinary
   items...................................               307,243           (193,822)        (1,038,150)
Extraordinary loss on
   extinguishment of debt..................                     -                  -           (521,380)
                                                    -------------      -------------     --------------
Net income (loss)..........................        $      307,243     $     (193,822)   $    (1,559,530)
                                                    =============      =============     ==============

Net income (loss) allocable to limited
   partners................................        $      291,881     $     (636,783)   $    (1,502,409)
Net income (loss) allocable to
   General Partner.........................                15,362            442,961            (57,121)
                                                    -------------      -------------     --------------
Net income (loss)..........................        $      307,243     $     (193,822)   $    (1,559,530)
                                                    =============      =============     ==============

Net income (loss) per limited partnership
   unit:
   Income (loss) before extraordinary
     items.................................        $         1.83     $        (3.98)   $        (6.16)
   Extraordinary gain (loss) on
     extinguishment of debt................                     -                  -             (3.22)
                                                    -------------      -------------     -------------
   Net income (loss).......................        $         1.83     $        (3.98)   $        (9.38)
                                                    =============      =============     =============
</TABLE>


                 See accompanying notes to financial statements.
<PAGE>


                        McNEIL REAL ESTATE FUND XI, LTD.

                         STATEMENTS OF PARTNERS' DEFICIT

              For the Years Ended December 31, 1995, 1994 and 1993



<TABLE>
<CAPTION>
                                                                                                   Total
                                                    General                 Limited                Partners'
                                                    Partner                 Partners               Deficit
                                                 ----------------        ----------------      ----------------
<S>                                              <C>                     <C>                   <C>             
Balance at December 31, 1992..............       $    (4,475,058)        $    (3,136,181)      $    (7,611,239)

Net loss..................................               (57,121)             (1,502,409)           (1,559,530)

Contingent Management Incentive
   Distribution...........................              (625,529)                      -              (625,529)
                                                  --------------          --------------        --------------

Balance at December 31, 1993..............            (5,157,708)             (4,638,590)           (9,796,298)

Net income (loss).........................               442,961                (636,783)             (193,822)

Contingent Management Incentive
   Distribution...........................              (769,448)                      -              (769,448)
                                                  --------------          --------------        --------------

Balance at December 31, 1994..............            (5,484,195)             (5,275,373)          (10,759,568)

Net income................................                15,362                 291,881               307,243

Contingent Management Incentive
   Distribution...........................              (871,053)                      -              (871,053)
                                                  --------------          --------------        --------------

Balance at December 31, 1995..............       $    (6,339,886)        $    (4,983,492)      $   (11,323,378)
                                                  ==============          ==============        ==============
</TABLE>













                 See accompanying notes to financial statements.


<PAGE>
                        McNEIL REAL ESTATE FUND XI, LTD.

                            STATEMENTS OF CASH FLOWS

                Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>
                                                             For the Years Ended December 31,
                                                   ------------------------------------------------------
                                                         1995               1994               1993
                                                   ---------------    ---------------   -----------------
   <S>                                             <C>                <C>               <C>            
Cash flows from operating activities:
   Cash received from tenants..............        $   14,298,528     $   13,292,954    $    12,411,792
   Cash paid to suppliers..................            (5,477,026)        (5,037,523)        (5,842,375)
   Cash paid to affiliates.................            (2,115,099)          (667,861)          (901,634)
   Interest received.......................               147,758             84,213             51,414
   Interest paid...........................            (3,676,175)        (3,839,943)        (3,719,734)
   Interest paid to affiliates.............                     -             (3,589)          (520,649)
   Property taxes paid.....................              (832,090)          (672,666)        (1,012,528)
                                                    -------------      -------------     --------------
Net cash provided by operating
   activities..............................             2,345,896          3,155,585            466,286
                                                    -------------      -------------     --------------

Cash flows from investing activities:
   Additions to real estate
     investments...........................            (1,820,043)        (2,154,079)        (2,089,700)
   Insurance proceeds from fire............                     -             28,109            277,145
                                                    -------------      -------------     --------------
Net cash used in investing activities......            (1,820,043)        (2,125,970)        (1,812,555)
                                                    -------------      -------------     --------------

Cash flows from financing activities:
   Net proceeds from refinancing of
     mortgage notes payable................                     -                  -          6,760,884
   Principal payments on mortgage
     notes payable.........................              (427,660)          (394,008)          (500,461)
   Deferred borrowing costs paid...........                     -           (127,801)          (863,525)
   Reinstatement of mortgage principal
     due to note modification..............                     -                  -            180,287
   Proceeds from mortgage note
     payable - affiliate...................                     -                  -             50,000
   Repayment of mortgage note
     payable - affiliate...................                     -                  -           (200,000)
   Repayment of advances from
     affiliates............................                     -           (936,377)        (1,931,440)
   Contingent Management Incentive
     Distribution..........................                     -           (560,035)            (7,107)
                                                    -------------      -------------     --------------
Net cash provided by (used in)
     financing activities..................              (427,660)        (2,018,221)         3,488,638
                                                    -------------      -------------     --------------
Net increase (decrease) in cash
     and cash equivalents..................                98,193           (988,606)         2,142,369

Cash and cash equivalents at
     beginning of year.....................             1,932,351          2,920,957            778,588
                                                    -------------      -------------     --------------
Cash and cash equivalents at end
     of year...............................        $    2,030,544     $    1,932,351    $     2,920,957
                                                    =============      =============     ==============
</TABLE>
See discussion of noncash investing and financing activities in Notes 6 and 7.

                 See accompanying notes to financial statements.


<PAGE>
                        McNEIL REAL ESTATE FUND XI, LTD.

                            STATEMENTS OF CASH FLOWS


           Reconciliation of Net Income (Loss) to Net Cash Provided by
                              Operating Activities

<TABLE>
<CAPTION>


                                                              For the Years Ended December 31,
                                                     ---------------------------------------------------
                                                         1995               1994               1993
                                                     -----------        -------------     --------------
<S>                                                  <C>                <C>               <C>           
Net income (loss)..........................        $      307,243     $     (193,822)   $    (1,559,530)
                                                    -------------      -------------     --------------

Adjustments to reconcile net income
   (loss) to net cash provided by
   operating activities:
   Extraordinary gain on
     extinguishment of debt................                     -                  -            521,380
   Gain on involuntary conversion..........                     -            (28,109)          (178,460)
   Depreciation............................             2,484,425          2,341,485          2,079,859
   Amortization of discounts on
     mortgage notes payable................                21,668             20,514            209,441
   Amortization of deferred borrowing
     costs.................................               145,498            137,072             79,688
   Net interest added to advances
     from affiliates.......................                     -                  -                718
   Changes in assets and liabilities:
     Cash segregated for security
       deposits............................               (22,276)           (25,939)           (38,648)
     Accounts receivable...................                (6,750)             3,889            (12,150)
     Prepaid expenses and other
       assets..............................                85,124             60,668           (203,413)
     Escrow deposits.......................                79,449            422,335            (64,146)
     Accounts payable......................               (50,679)          (112,570)          (210,216)
     Accrued interest......................                62,062            (95,829)          (335,702)
     Accrued expenses......................               138,356            154,930            (44,570)
     Payable to affiliates - General
       Partner.............................              (938,646)           438,501            207,836
     Security deposits and deferred
       rental income.......................                40,422             32,460             14,199
                                                    -------------      -------------     --------------

         Total adjustments.................             2,038,653          3,349,407          2,025,816
                                                    -------------      -------------     --------------

Net cash provided by operating
   activities..............................        $    2,345,896     $    3,155,585    $       466,286
                                                    =============      =============     ==============
</TABLE>


                 See accompanying notes to financial statements.


<PAGE>
                        McNEIL REAL ESTATE FUND XI, LTD.

                          NOTES TO FINANCIAL STATEMENTS

                                December 31, 1995

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------

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

McNeil Real Estate Fund XI, Ltd. (the  "Partnership") was organized June 2, 1980
as a limited  partnership under the provisions of the California Uniform Limited
Partnership Act. The general partner of the Partnership is McNeil Partners, L.P.
(the "General Partner"), a Delaware limited partnership,  an affiliate of Robert
A. McNeil.  The  Partnership is governed by an amended and restated  partnership
agreement of limited  partnership dated August 6, 1991, as amended (the "Amended
Partnership Agreement"). The principal place of business for the Partnership and
for the General  Partner is 13760 Noel Road,  Suite 700,  LB70,  Dallas,  Texas,
75240.

The Partnership is engaged in real estate  activities,  including the ownership,
operation  and  management  of  residential  real  estate and other real  estate
related   assets.   At  December  31,   1995,   the   Partnership   owned  eight
income-producing properties as described in Note 4 - Real Estate Investments.

Basis of Presentation
---------------------

The  accompanying  financial  statements  have been prepared in conformity  with
generally accepted accounting principles ("GAAP").  The preparation of financial
statements in conformity  with GAAP  requires  management to make  estimates and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  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.

The  Partnership's  financial  statements  include the accounts of the following
listed tier  partnerships  for the years ended December 31, 1995, 1994 and 1993.
These single asset tier  partnerships were formed to accommodate the refinancing
of  the  respective  property.  The  Partnership's  and  the  General  Partner's
ownership  interest in each tier  partnership is detailed below. The Partnership
retains  effective  control  of each tier  partnership.  The  General  Partner's
minority interest is not presented as it is either negative or immaterial.

<TABLE>
<CAPTION>
                                                                % of Ownership Interest
   Tier Partnership                                        Partnership       General Partner
   ----------------                                        -----------       ---------------   
<S>                                                           <C>                      <C>
   Limited Partnerships:
Acacia Lakes Fund XI Limited Partnership                      99                       1
Gentle Gale Fund XI Limited Partnership*                     100                       -
Villa Del Rio XI Limited Partnership*                        100                       -
Village Fund XI Associates                                    99                       1

   General Partnerships:
Knollwood XI Associates                                       99                       1
The Park Fund XI Associates                                   99                       1
Sun Valley Fund XI Associates                                 99                       1
</TABLE>
*    The general partner of these  partnerships is a corporation  whose stock is
     100% owned by the Partnership.
<PAGE>
Real Estate Investments
-----------------------

Real  estate  investments  are  generally  stated  at the  lower  of cost or net
realizable value.  Real estate  investments are monitored on an ongoing basis to
determine if the property has sustained a permanent impairment in value. At such
time,  a  write-down  is recorded to reduce the basis of the property to its net
realizable  value. A permanent  impairment is determined to have occurred when a
decline in property  value is considered to be other than  temporary  based upon
management's  expectations  with respect to projected  cash flows and prevailing
economic conditions.

Improvements and betterments are capitalized and expensed  through  depreciation
charges. Repairs and maintenance are charged to operations as incurred.

In March 1995,  the Financial  Accounting  Standards  Board issued  Statement of
Financial  Accounting  Standards  No. 121,  "Accounting  for the  Impairment  of
Long-Lived  Assets and for Long-Lived  Assets to be Disposed Of." This statement
requires that long-lived assets and certain identifiable  intangibles to be held
and used by an entity be reviewed for impairment  whenever  events or changes in
circumstances  indicate  that  the  carrying  amount  of an  asset  may  not  be
recoverable.  This  statement is effective for financial  statements  for fiscal
years  beginning  after December 15, 1995. The  Partnership  has not adopted the
principles  of this  statement  within the  accompanying  financial  statements;
however,  it is not anticipated that adoption will have a material effect on the
carrying value of the Partnership's long-lived assets.

Depreciation
------------

Buildings and improvements are depreciated using the  straight-line  method over
the estimated useful lives of the assets, ranging from 3 to 40 years.

Cash and Cash Equivalents
-------------------------

Cash  and  cash  equivalents  include  cash on hand  and  cash on  deposit  with
financial  institutions  with  original  maturities  of  three  months  or less.
Carrying amounts for cash and cash equivalents approximate fair value.

Escrow Deposits
---------------

The  Partnership is required to maintain  escrow accounts in accordance with the
terms of various  mortgage  indebtedness  agreements.  These escrow accounts are
controlled by the mortgagee and are used for payment of property  taxes,  hazard
insurance,  capital improvements and/or property replacements.  Carrying amounts
for escrow deposits approximate fair value.

Deferred Borrowing Costs
------------------------

Loan fees and other related costs incurred to obtain long-term financing on real
property are  capitalized  and amortized  using a method that  approximates  the
effective  interest method over the terms of the related mortgage notes payable.
Amortization of deferred  borrowing costs is included in interest expense on the
Statements of Operations.

<PAGE>

Discounts on Mortgage Notes Payable
-----------------------------------

Discounts on mortgage notes payable are being amortized over the remaining terms
of the related mortgage notes using the effective interest method.  Amortization
of discounts on the mortgage  notes  payable is included in interest  expense on
the Statements of Operations.

Rental Revenue
--------------

The Partnership  leases its residential  properties under  short-term  operating
leases. Lease terms generally are less than one year in duration. Rental revenue
is recognized as earned.

Income Taxes
------------

No provision for Federal  income taxes is necessary in the financial  statements
of the  Partnership  because,  as a  partnership,  it is not  subject to Federal
income tax, and the tax effect of its activities accrues to the partners.

Allocation of Net Income and Net Loss
-------------------------------------

The Amended Partnership Agreement provides for net income of the Partnership for
both  financial  statement and income tax reporting  purposes to be allocated as
indicated  below.  For  allocation  purposes,  net  income  and net  loss of the
Partnership are determined prior to deductions for depreciation:

a)   first,  deductions  for  depreciation  shall be allocated 5% to the General
     Partner and 95% to the limited partners;

b)   then,  net income in an amount equal to the  cumulative  amount paid to the
     General  Partner for the  contingent  portion of the  Management  Incentive
     Distribution  ("MID"),  for which no previous income  allocations have been
     made, shall be allocated to the General Partner; provided, however, that if
     all or a portion of such  payment  consists  of limited  partnership  units
     ("Units"),  the amount of net income allocated shall be equal to the amount
     of cash the General Partner would have otherwise received; and

c)   then, any remaining net income shall be allocated to achieve the allocation
     of 5% to the General Partner and 95% to the limited partners.

The Amended  Partnership  Agreement  provides  that net losses,  other than that
arising from a sale or refinancing, shall be allocated 5% to the General Partner
and 95% to the limited partners.

Net losses  arising  from a sale or  refinancing  shall be  allocated  1% to the
General Partner and 99% to the limited partners.

Federal  income tax law provides  that the  allocation of loss to a partner will
not be  recognized  unless the  allocation  is in  accordance  with a  partner's
interest in the partnership or the allocation has substantial  economic  effect.
Internal  Revenue  Code Section  704(b) and  accompanying  Treasury  Regulations
establish  criteria for  allocations of Partnership  deductions  attributable to
debt. The  Partnership's tax allocations for 1995, 1994, and 1993 have been made
in accordance with these provisions.

<PAGE>

Distributions
-------------

Pursuant to the  Amended  Partnership  Agreement  and at the  discretion  of the
General  Partner,  distributions  during  each  taxable  year  shall  be made as
follows:

(a)  first, to the General Partner, in an amount equal to the contingent portion
     of the MID; and

(b)  any remaining  distributable cash, as defined, shall be distributed 100% to
     the limited partners.

No  distributions  were made to the limited  partners in 1995, 1994 or 1993. The
Partnership  accrued  distributions  of $871,503,  $769,448 and $625,529 for the
benefit of the General  Partner for the years ended December 31, 1995,  1994 and
1993,  respectively.  These distributions are the contingent MID pursuant to the
Amended Partnership Agreement.

Net Income (Loss) Per Limited Partnership Unit
----------------------------------------------

Net income (loss) per Unit is computed by dividing net income  (loss)  allocated
to the limited partners by the number of Units outstanding. Per Unit information
has been computed  based on 159,813,  159,917 and 160,079 Units  outstanding  in
1995, 1994 and 1993, respectively.

NOTE 2 - TRANSACTIONS WITH AFFILIATES
-------------------------------------

The  Partnership  pays property  management fees equal to 5% of the gross rental
receipts of the Partnership's properties to McNeil Real Estate Management,  Inc.
("McREMI"),  an  affiliate  of  the  General  Partner,  for  providing  property
management and leasing services.

The  Partnership  reimburses  McREMI  for  its  costs,  including  overhead,  of
administering the Partnership's affairs.

Under terms of the Amended Partnership Agreement,  the Partnership is paying the
MID to the General Partner.  The maximum MID is calculated as 1% of the tangible
asset value of the Partnership.  The maximum MID percentage decreases subsequent
to 1999.  Tangible  asset  value is  determined  by using the  greater of (i) an
amount calculated by applying a capitalization  rate of 9% to the annualized net
operating  income of each property or (ii) a value of $10,000 per apartment unit
for  residential  property to arrive at the property  tangible asset value.  The
property  tangible  asset  value is then  added to the book  value of all  other
assets excluding  intangible items.  Prior to July 1, 1993, the MID consisted of
two  components:  (i) the fixed portion which was payable without respect to the
net  income  of the  Partnership  and was equal to 25% of the  maximum  MID (the
"Fixed MID") and (ii) a contingent  portion which was payable only to the extent
of the  lesser  of the  Partnership's  excess  cash  flow,  as  defined,  or net
operating  income (the  "Entitlement  Amount") and was equal to up to 75% of the
maximum MID (the "Contingent MID").

Effective  July 1, 1993,  the General  Partner  amended the Amended  Partnership
Agreement as a settlement to a class action complaint. This amendment eliminates
the Fixed MID and makes the entire MID payable to the extent of the  Entitlement
Amount.  In all other respects the calculation and payment of the MID remain the
same.

<PAGE>
Fixed MID was payable in Units unless the Entitlement Amount exceeded the amount
necessary to pay the  Contingent  MID, in which case,  at the General  Partner's
option, the Fixed MID was paid in cash to the extent of such excess.

Contingent MID will be paid to the extent of the Entitlement  Amount, and may be
paid (i) in cash,  unless there is insufficient  cash to pay the distribution in
which  event any  unpaid  portion  not taken in Units  will be  deferred  and is
payable, without interest, from the first available cash and/or (ii) in Units. A
maximum of 50% of the MID may be paid in Units.  The  number of Units  issued in
payment of the MID is based on the  greater of $50 per Unit or the net  tangible
asset value per Unit, as defined.  No Units were issued in payment of the MID in
1995, 1994 or 1993.

During  1991,  the  Partnership  amended  its  capitalization  policy  and began
capitalizing  certain costs of improvements and betterments which under policies
of  prior  management  had been  expensed  when  incurred.  The  purpose  of the
amendment was to more properly recognize items which were capital in nature. The
effect of the amendment  standing alone was evaluated at the time the change was
made and  determined  not to be  material  to the  financial  statements  of the
Partnership  in 1991,  nor was it expected  to be  material in any future  year.
However,  the amendment  can have a material  effect on the  calculation  of the
Entitlement  Amount which determines the amount of Contingent MID earned and the
amount of Fixed MID payable in cash. Capital improvements are excluded from cash
flow, as defined.  The majority of base period cash flow was measured  under the
previous  capitalization  policy, while incentive period cash flow is determined
using the amended policy.  Under the amended policy, more items are capitalized,
and cash flow  increases.  The  amendment of the  capitalization  policy did not
materially affect the MID for 1995, 1994 or 1993 because the Entitlement  Amount
was  sufficient  to pay  Contingent  MID  notwithstanding  the  amendment to the
capitalization policy.

Any  amount  of the MID that is paid to the  General  Partner  in Units  will be
treated as if cash is distributed to the General Partner and is then contributed
to the  Partnership by the General  Partner.  The Fixed MID was treated as a fee
payable to the General  Partner by the Partnership  for services  rendered.  The
Contingent  MID  represents  a return  of  equity  to the  General  Partner  for
increasing cash flow, as defined, and accordingly is treated as a distribution.

Compensation and  reimbursements  paid or accrued for the benefit of the General
Partner or its affiliates are as follows:

<TABLE>
<CAPTION>
                                                            For the Years Ended December 31,
                                                   ----------------------------------------------------
                                                       1995                1994               1993
                                                   --------------     --------------    ---------------
<S>                                                <C>                <C>               <C>            
Property management fees - affiliates......        $      711,435     $      671,785    $       625,549
Interest - affiliates......................                     -              3,589            145,644
Charged to general and
   administrative - affiliates:
   Partnership administration..............               465,018            434,577            401,868
   Fixed MID...............................                     -                  -             82,053
                                                    -------------      -------------     --------------
                                                   $    1,176,453    $     1,109,951    $     1,255,114
                                                    =============      =============     ==============
Charged to General Partner's deficit:
   Contingent MID..........................        $      871,053    $       769,448    $       625,529
                                                    =============      =============     ==============
</TABLE>


<PAGE>

Payable to  affiliates - General  Partner at December 31, 1995 and 1994 consists
primarily of reimbursable costs, unpaid property management fees and accrued but
unpaid  Contingent  MID.  These  payables  are  due  and  payable  from  current
operations.

NOTE 3 - TAXABLE INCOME (LOSS)
------------------------------

McNeil Real Estate Fund XI, Ltd. is a partnership  and is not subject to Federal
and state income taxes.  Accordingly,  no  recognition  has been given to income
taxes in the  accompanying  financial  statements of the  Partnership  since the
income or loss of the  Partnership  is to be  included in the tax returns of the
individual  partners.  The  tax  returns  of  the  Partnership  are  subject  to
examination by Federal and state taxing authorities. If such examinations result
in  adjustments  to  distributive  shares of  taxable  income  or loss,  the tax
liability of the partners could be adjusted accordingly.

The Partnership's net assets and liabilities for tax purposes were less than the
net assets and liabilities for financial  reporting purposes by $62,005 in 1995,
$415,728 in 1994, and $371,525 in 1993.

NOTE 4 - REAL ESTATE INVESTMENTS
--------------------------------

The  basis  and  accumulated  depreciation  of  the  Partnership's  real  estate
investments at December 31, 1995 and 1994 are set forth in the following tables:

<TABLE>
<CAPTION>

                                                    Buildings and       Accumulated           Net Book
       1995                         Land            Improvements        Depreciation            Value
       ----                    --------------      --------------     ----------------     --------------
<S>                            <C>                 <C>                <C>                  <C>           
Acacia Lakes
   Mesa, AZ                    $    1,953,090      $   12,687,204     $    (8,213,224)     $    6,427,070
Gentle Gale
   Galveston, TX                      450,155           3,577,012          (2,167,312)          1,859,855
Knollwood
   Kansas City, MO                    330,547           6,423,419          (4,298,156)          2,455,810
The Park
   Joplin, MO                         165,329           4,238,254          (3,069,781)          1,333,802
Rock Creek
   Beaverton, OR                    1,365,810           9,663,748          (6,671,446)          4,358,112
Sun Valley
   Charlotte, NC                      562,797           8,204,402          (4,282,305)          4,484,894
Villa Del Rio
   Jacksonville, FL                   636,634           9,261,056          (5,531,458)          4,366,232
The Village
   Gresham, OR                        474,102           4,353,456          (2,861,502)          1,966,056
                                -------------       -------------       -------------       -------------
                               $    5,938,464     $    58,408,551     $   (37,095,184)     $   27,251,831
                                =============       =============       =============       =============

</TABLE>


<PAGE>

<TABLE>
<CAPTION>
                                                    Buildings and       Accumulated           Net Book
       1994                          Land           Improvements        Depreciation            Value
       ----                    --------------     ---------------     ----------------     --------------
<S>                            <C>                <C>                 <C>                  <C>           
Acacia Lakes                   $    1,953,090     $    12,325,108     $    (7,717,064)     $    6,561,134
Gentle Gale                           450,155           3,476,917          (1,992,803)          1,934,269
Knollwood                             330,547           6,071,771          (4,041,889)          2,360,429
The Park                              165,329           4,133,153          (2,896,491)          1,401,991
Rock Creek                          1,365,810           9,423,597          (6,207,808)          4,581,599
Sun Valley                            562,797           7,899,254          (3,958,479)          4,503,572
Villa Del Rio                         636,634           9,000,503          (5,167,379)          4,469,758
The Village                           474,102           4,258,205          (2,628,846)          2,103,461
                                -------------       -------------       -------------       -------------
                               $    5,938,464     $    56,588,508     $   (34,610,759)     $   27,916,213
                                =============       =============       =============       =============
</TABLE>

The Partnership's real estate properties are encumbered by mortgage indebtedness
as discussed in Note 5.

NOTE 5 - MORTGAGE NOTES PAYABLE
-------------------------------

The following  table sets forth the mortgage notes payable of the Partnership at
December  31,  1995 and 1994.  All  mortgage  notes are  secured by real  estate
investments.

<TABLE>
<CAPTION>
                         Mortgage           Annual       Monthly
                         Lien               Interest     Payments/                       December 31,
Property                 Position (a)       Rates %      Maturity Date (c)          1995              1994
--------                 ------------       -------      -----------------     -------------     ---------------
<S>                      <C>                  <C>      <C>           <C>       <C>               <C>            
Acacia Lakes             First                8.700    $   71,069    01/01     $    8,937,249    $     9,003,355
                                                                                -------------     --------------

Gentle Gale              First                8.150        22,327    07/03          2,694,292          2,740,563
                         Discount (b)                                                 (64,784)           (71,678)
                                                                                -------------     --------------
                                                                                    2,629,508          2,668,885
                                                                                -------------     --------------

Knollwood                First                7.750        32,506    05/24          4,472,878          4,514,538
                                                                                -------------     --------------

The Park                 First               10.500        24,021    05/24          2,604,482          2,618,451
                                                                                -------------     --------------

Rock Creek               First               11.875        67,860    02/01          6,224,682          6,295,202
                                                                                -------------     --------------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                         Mortgage           Annual       Monthly
                         Lien               Interest     Payments/                       December 31,
Property                 Position (a)       Rates %      Maturity Date (c)          1995              1994
--------                 ------------       -------      -----------------     -------------     ---------------
<S>                      <C>                  <C>      <C>           <C>       <C>               <C>            
Sun Valley               First                7.875        48,384    06/24     $    6,585,644    $     6,645,073
                                                                                -------------     --------------

Villa Del Rio            First                8.150        47,843    07/03          5,773,484          5,872,634
                         Discount (b)                                                (138,822)          (153,596)
                                                                                -------------     ---------------
                                                                                    5,634,662          5,719,038
                                                                                -------------     --------------

The Village              First               10.875        26,219    11/96          2,595,335          2,625,890
                                                                                -------------     --------------
                                                                               $   39,684,440    $    40,090,432
                                                                                =============     ==============
</TABLE>

(a)      The debt is non-recourse to the Partnership.

(b)      Discounts are based on an effective interest rate of 8.62%.

(c)      Balloon payments on the mortgage notes are due as follows:

<TABLE>
<CAPTION>
         Property                  Balloon Payment            Date
         --------                  ---------------            ----
        <S>                          <C>                      <C>  
        The Village                  $ 2,564,000              11/96
        Acacia Lakes                   8,468,000              01/01
        Rock Creek                     5,704,000              02/01
        Gentle Gale                    2,197,000              07/03
        Villa Del Rio                  4,707,000              07/03
</TABLE>


Scheduled principal  maturities of the mortgage notes,  before  consideration of
discounts of $203,606, are as follows:

<TABLE>
<CAPTION>

                  <S>                                        <C>         
                  1996....................................   $  3,035,587
                  1997....................................        481,222
                  1998....................................        526,120
                  1999....................................        575,334
                  2000....................................        629,296
                  Thereafter..............................     34,640,487
                                                              -----------
                    Total                                    $ 39,888,046
                                                              ===========
</TABLE>

<PAGE>

Based on borrowing  rates  currently  available to the  Partnership for mortgage
loans with similar terms and average maturities, the fair value of notes payable
was approximately $40,765,000 as of December 31, 1995.

NOTE 6 - GAIN ON INVOLUNTARY CONVERSION
---------------------------------------

On March 15, 1993, 8 units at Sun Valley were destroyed by fire causing $317,100
in damages. The Partnership received $277,145 in insurance  reimbursements as of
December 31, 1993, to cover the cost to repair Sun Valley. The property received
an  additional   $28,109  in  insurance   reimbursements   in  1994.   Insurance
reimbursements  received  in excess of the basis of the  property  damaged  were
recorded as a gain on involuntary conversion. The Partnership recorded a gain of
$28,109 and $178,460 in 1994 and 1993, respectively.

NOTE 7 - REFINANCING OF MORTGAGE NOTES PAYABLE
----------------------------------------------

On November 23, 1993,  the  Partnership  refinanced the mortgage note payable on
Acacia Lakes. A summary of the proceeds from refinancing is as follows:

<TABLE>
<CAPTION>

         <S>                                                     <C>        
         New loan proceeds...........................            $ 9,075,000
         Existing debt retired.......................             (6,340,109)
                                                                  ----------
         Net cash proceeds from refinancing..........            $ 2,734,891
                                                                  ==========
</TABLE>

The  Partnership   deposited   $183,751  into  property  taxes,   insurance  and
replacement  escrows  and  incurred  loan  costs  of  $376,292  relating  to the
refinancing.  The  Partnership  also recognized an  extraordinary  loss on early
extinguishment  of debt on  Acacia  Lakes in the  amount of  $285,501,  which is
attributable to the unamortized discount on the retired mortgage.

On June 24, 1993, the General Partner refinanced a portfolio of properties via a
Real Estate Mortgage Investment Conduit ("REMIC"). This REMIC consists of a pool
of properties from various partnerships  affiliated with McNeil. Gentle Gale and
Villa Del Rio were  included in the REMIC.  The  properties in the REMIC are not
collateralized across the partnerships,  but are cross-collateralized within the
same partnership.  The new mortgage loans bear an interest rate of 8.15%,  which
have been  discounted  to an effective  rate of 8.62%,  and mature in July 2003.
Following is a summary of the cash proceeds relating to the refinancings:

<TABLE>
<CAPTION>
                                                Gentle Gale           Villa Del Rio           Total
                                               -------------          -------------       -------------

     <S>                                       <C>                    <C>                 <C>         
     New loan proceeds....................     $  2,800,000           $  6,000,000        $  8,800,000
     Existing debt retired................       (1,673,558)            (2,754,791)         (4,428,349)
     Mortgage discount....................          (81,363)              (174,352)           (255,715)
     Prepayment penalty...................          (33,472)               (56,471)            (89,943)
                                                -----------            -----------         -----------
     Net cash proceeds from
       refinancing........................     $  1,011,607           $  3,014,386        $  4,025,993
                                                ===========            ===========         ===========
</TABLE>

<PAGE>

The  Partnership  deposited  $328,157 into separate escrow accounts for property
taxes,  insurance and  replacement  reserves and incurred loan costs of $487,233
relating to the refinancings.  The Partnership  recognized an extraordinary loss
on early extinguishment of debt on Gentle Gale in the amount of $179,408,  which
is attributable to the unamortized  discount and prepayment  penalty relating to
the retired mortgage.  The Partnership also recognized an extraordinary  loss on
early extinguishment of debt on Villa Del Rio in the amount of $56,471, which is
attributable to the prepayment penalty relating to the retired mortgage.

NOTE 8 - LEGAL PROCEEDINGS
--------------------------

1)   High River Limited Partnership v. McNeil Partners,  L.P., McNeil Investors,
     Inc., McNeil Pacific Investors 1972, Ltd., McNeil Real Estate Fund V, Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XIV, Ltd.,  McNeil Real
     Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real Estate
     Fund XXIV,  L.P.,  McNeil Real Estate Fund XXV, L.P.,  Robert A. McNeil and
     Carole J.  McNeil  (L95012) - High River  ("HR")  filed this  action in the
     United States District Court for the Southern  District of New York against
     McNeil Partners,  L.P., McNeil Investors,  Inc. and Mr. and Mrs. McNeil (as
     defined in this  Section 1,  collectively,  the  "Defendants")  requesting,
     among other  things,  names and  addresses  of the limited  partners in the
     partnerships   referenced   above  (as  defined  in  this  Section  1,  the
     "Partnerships"). The District Court issued a preliminary injunction against
     the Partnerships  requiring them to commence mailing materials  relating to
     the HR tender offer on August 14, 1995.

     On August 18, 1995, the Defendants  filed an Answer and  Counterclaim.  The
     Counterclaim  principally  asserts  (1)  the HR  tender  offers  have  been
     undertaken  in violation of the federal  securities  laws,  on the basis of
     material,  non-public,  and confidential  information,  and (2) that the HR
     offer documents omit and/or misrepresent certain material information about
     the HR tender offers.  The  Counterclaim  seeks a preliminary and permanent
     injunction   against  the   continuation  of  the  HR  tender  offers  and,
     alternatively,  ordering  corrective  disclosure  with respect to allegedly
     false and misleading statements contained in the tender offer documents.

     This action was dismissed without prejudice in November 1995.

2)   High River Limited Partnership v. McNeil Partners,  L.P., McNeil Investors,
     Inc., McNeil Pacific Investors 1972, Ltd., McNeil Real Estate Fund V, Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XIV, Ltd.,  McNeil Real
     Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real Estate
     Fund XXIV,  L.P.,  McNeil Real Estate Fund XXV, L.P.,  Robert A. McNeil and
     Carole J. McNeil - United States  District Court for the Southern  District
     of New York, (Case No. 95 Civ. 9488) (Second Action).

     On November 7, 1995, High River filed a second  complaint with the District
     Court which alleges, inter alia, that McNeil Partners, L.P.'s (the "General
     Partner")  Schedule  14D-9 filed in  connection  with the High River tender
     offers was materially false and misleading,  in violation of Sections 14(d)
     and 14(e) of the Securities Exchange Act of 1934, 15 U.S.C.  Section 78n(d)
     and (e),  and the SEC  Regulations  promulgated  thereunder;  and that High
     River further  alleges that the General  Partner has wrongfully  refused to
     admit High River as a limited  partner to the ten  partnerships  referenced

<PAGE>
     above.  Additionally,  High River purports to assert claims derivatively on
     behalf of McNeil  Real Estate  Fund IX,  Ltd.,  McNeil Real Estate Fund XI,
     Ltd.,  McNeil Real Estate Fund XV, Ltd., McNeil Real Estate Fund XXIV, L.P.
     and McNeil Real Estate Fund XXV, L.P., for breach of contract and breach of
     fiduciary  duty,  asserting  that the General  Partner  has  charged  these
     partnerships  excessive fees.  High River's  complaint  seeks,  inter alia,
     preliminary  injunctive  relief requiring the General Partner to admit High
     River as a limited partner in each of the ten partnerships referenced above
     and to transfer the tendered units of interest in the  partnerships to High
     River;  an  unspecified  award of  damages  payable  to High  River  and an
     additional   unspecified  award  of  damages  payable  to  certain  of  the
     partnerships;  an order that  defendants  must  discharge  their  fiduciary
     duties and must account for all fees they have received from certain of the
     partnerships; and attorneys' fees.

     On January 31, 1996, this action was dismissed without prejudice.

3)   Robert Lewis v. McNeil Partners,  L.P., McNeil  Investors,  Inc., Robert A.
     McNeil  et al - In the  District  Court of  Dallas  County,  Texas,  A-14th
     Judicial  District,  Cause No. 95-08535 (Class Action) - Plaintiff,  Robert
     Lewis, is a limited partner with McNeil Pacific  Investors Fund 1972, Ltd.,
     McNeil Real Estate Fund X, Ltd. and McNeil Real Estate Fund XV, Ltd.

     Plaintiff  brings  this  action on his own behalf and as a class  action on
     behalf of the class of all  limited  partners of McNeil  Pacific  Investors
     Fund 1972, Ltd.,  McNeil Real Estate Fund V, Ltd.,  McNeil Real Estate Fund
     IX,  Ltd.,  McNeil Real  Estate  Fund X, Ltd.,  McNeil Real Estate Fund XI,
     Ltd.,  McNeil Real Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd.,
     McNeil Real Estate Fund XX,  L.P.,  McNeil Real Estate Fund XXIV,  L.P. and
     McNeil  Real  Estate  Fund XXV,  Ltd.  (as  defined in this  Section 3, the
     "Partnerships") as of August 4, 1995.

     Plaintiff  alleges that McNeil  Partners,  L.P.,  McNeil  Investors,  Inc.,
     Robert A. McNeil and other  senior  officers (as defined in this Section 3,
     collectively,  the "Defendants")  breached their fiduciary duties by, among
     other things,  (1) failing to attempt to sell the  properties  owned by the
     Partnerships (as defined in this Section 3, the "Properties") and extending
     the lives of the Partnerships  indefinitely,  contrary to the Partnerships'
     business plans, (2) paying  distributions to themselves and generating fees
     for their affiliates, (3) refusing to make significant distributions to the
     class members,  despite the fact that the  Partnerships  have positive cash
     flows and  substantial  cash  balances,  and (4)  failing  to take steps to
     create an auction market for equity interests of the Partnerships,  despite
     the fact that a third party bidder filed  tender  offers for  approximately
     forty-five   percent  (45%)  of  the  outstanding  units  of  each  of  the
     Partnerships.  Plaintiff  also claims that  Defendants  have  breached  the
     partnership  agreements  of the  Partnerships  by  failing to take steps to
     liquidate  the  Properties  and by their  alteration  of the  Partnerships'
     primary  purposes,  their acts in  contravention of these  agreements,  and
     their use of the assets of the  Partnerships  for their own benefit instead
     of for the benefit of the Partnerships.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend this action.

<PAGE>

4)   James F.  Schofield,  Gerald C.  Gillett  and Donna S.  Gillett  v.  McNeil
     Partners,  L.P.,  McNeil Investors,  Inc.,  McNeil Real Estate  Management,
     Inc., Robert A. McNeil,  Carole J. McNeil, McNeil Real Estate Fund V, Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XIV, Ltd.,  McNeil Real
     Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real Estate
     Fund XXIV,  L.P.,  McNeil Real Estate Fund XXV, L.P. et al - Superior Court
     of the State of California for the County of Los Angeles, Case No. BC133799
     (Class and Derivative  Action  Complaint) and United States District Court,
     Southern  District of New York, Case No.  95CIV.6711  (Class and Derivative
     Action Complaint)

     These are  corporate/securities  class and  derivative  actions  brought in
     state and federal court by limited partners of each of the nine (9) limited
     partnerships  that are named as  nominal  defendants  as  listed  above (as
     defined in this  Section 4, the  "Partnerships").  Plaintiffs  allege  that
     McNeil Investors,  Inc., its affiliate McNeil Real Estate Management,  Inc.
     and four (4) of their senior officers and/or  directors (as defined in this
     Section 4,  collectively,  the "Defendants")  have breached their fiduciary
     duties.  Specifically,  Plaintiffs  allege that  Defendants have caused the
     Partnerships  to enter  into  several  wasteful  transactions  that have no
     business  purpose or benefit to the  Partnerships  and which have  rendered
     such units highly illiquid and  artificially  depressed the prices that are
     available for units on the limited  resale market.  Plaintiffs  also allege
     that  Defendants  have  engaged  in a course  of  conduct  to  prevent  the
     acquisition of units by Carl Icahn by disseminating  false,  misleading and
     inadequate  information.  Plaintiffs  further allege that  Defendants  have
     acted to  advance  their  own  personal  interests  at the  expense  of the
     Partnerships' public unit holders by failing to sell Partnership properties
     and  failing  to make  distributions  to  unitholders  and,  thereby,  have
     breached the partnership agreements.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend these actions.

5)   Alfred Napoletano v. McNeil Partners, L.P., McNeil Investors,  Inc., Robert
     A. McNeil,  Carole J. McNeil,  McNeil Pacific  Investors  Fund 1972,  Ltd.,
     McNeil Real Estate Fund V, Ltd.,  McNeil Real Estate Fund IX, Ltd.,  McNeil
     Real Estate Fund X, Ltd.,  McNeil  Real Estate Fund XI,  Ltd.,  McNeil Real
     Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd., McNeil Real Estate
     Fund XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund
     XXV,  L.P.  -  Superior  Court of the  State of  California,  County of Los
     Angeles, Case No. BC133849 (Class Action Complaint)

     Plaintiff  brings this class action on behalf of a class of all persons and
     entities who are current owners of units and/or are limited partners in one
     or more of the partnerships referenced above (as defined in this Section 5,
     the "Partnerships").  Plaintiff alleges that McNeil Partners,  L.P., McNeil
     Investors,  Inc., Robert A. McNeil and other senior officers (as defined in
     this  Section  5,  collectively,  the  "Defendants")  have  breached  their
     fiduciary  duties to the class members by, among other  things,  (1) taking

<PAGE>

     steps to prevent the  consummation  of the High River  tender  offers,  (2)
     failing to take  steps to  maximize  unit  holders'  or  limited  partners'
     values,  including  failure  to  liquidate  the  properties  owned  by  the
     Partnerships,  (3) managing the  Partnerships so as to extend  indefinitely
     the present fee arrangements,  and (4) paying itself and entities owned and
     controlled by the general  partner  excessive  fees and  reimbursements  of
     general and administrative expenses.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend this action.

6)   Warren Heller v. McNeil Partners,  L.P., McNeil Investors,  Inc., Robert A.
     McNeil,  Carole J. McNeil, McNeil Pacific Investors Fund 1972, Ltd., McNeil
     Real Estate Fund V, Ltd.,  McNeil  Real Estate Fund IX,  Ltd.,  McNeil Real
     Estate Fund X, Ltd.,  McNeil Real Estate Fund XI, Ltd.,  McNeil Real Estate
     Fund XIV, Ltd.,  McNeil Real Estate Fund XV, Ltd.,  McNeil Real Estate Fund
     XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund XXV,
     L.P. - Superior  Court of the State of  California,  County of Los Angeles,
     Case No. BC133957 (Class Action Complaint)

     Plaintiff  brings this class action on behalf of a class of all persons and
     entities who are current owners of units and/or are limited partners in one
     or more of the partnerships referenced above (as defined in this Section 6,
     the "Partnerships").  Plaintiff alleges that McNeil Partners,  L.P., McNeil
     Investors,  Inc., Robert A. McNeil and other senior officers (as defined in
     this  Section  6,  collectively,  the  "Defendants")  have  breached  their
     fiduciary  duties to the class members by, among other  things,  (1) taking
     steps to prevent the  consummation  of the High River  tender  offers,  (2)
     failing to take steps to maximize unitholders' or limited partners' values,
     including  failure to liquidate the properties  owned by the  Partnerships,
     (3) managing the Partnerships so as to extend  indefinitely the present fee
     arrangements,  and (4) paying itself and entities  owned and  controlled by
     the  general  partner  excessive  fees and  reimbursements  of general  and
     administrative expenses.

     The Defendants deny that there is any merit to Plaintiff's  allegations and
     intend to vigorously defend this action.

NOTE 9 - SUBSEQUENT EVENT
-------------------------

On January 8, 1996, 23 units and a laundry facility, totaling 23,347 square feet
at Knollwood Apartments were destroyed by fire causing approximately $865,000 in
damages.  Management believes the insurance  reimbursements to cover the cost of
repair will exceed the basis of the property damaged by approximately $705,000.




<PAGE>


                        McNEIL REAL ESTATE FUND XI, LTD.
                                  SCHEDULE III
              REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
                                December 31, 1995

<TABLE>
<CAPTION>
                                                                                   Cumulative           Costs
                                                      Initial Cost (b)             Write-down        Capitalized
                          Related (b)                           Buildings and     and Permanent       Subsequent
Description               Encumbrances            Land           Improvements       Impairment      To Acquisition
-----------               ---------------    --------------     -------------     -------------     --------------
APARTMENTS:
<S>                        <C>               <C>               <C>                <C>              <C>          
Acacia Lakes
   Mesa, AZ               $     8,937,249   $     1,953,090   $    10,784,729    $           -    $    1,902,475

Gentle Gale
   Galveston, TX                2,629,508           450,155         2,925,081          (21,141)          673,072

Knollwood
   Kansas City, MO              4,472,878           330,547         5,122,225                -         1,301,194

The Park
   Joplin, MO                   2,604,482           165,329         3,795,607                -           442,647

Rock Creek
   Beaverton, OR                6,224,682         1,365,810         8,314,604                -         1,349,144

Sun Valley
   Charlotte, NC                6,585,644           562,797         7,056,988                -         1,147,414

Villa Del Rio
   Jacksonville, FL             5,634,662           636,634         7,685,383                -         1,575,673

The Village
   Gresham, OR                  2,595,335           474,102         3,372,567                -           980,889
                           --------------    --------------    --------------     ------------     -------------

                          $    39,684,440   $     5,938,464   $    49,057,184    $     (21,141)   $    9,372,508
                           ==============    ==============    ==============     ============     =============
</TABLE>


(b)  The initial cost and encumbrances  reflect the present value of future loan
     payments  discounted,  if  appropriate,  at a  rate  estimated  to  be  the
     prevailing interest rate at the date of acquisition or refinancing.











                     See accompanying notes to Schedule III.


<PAGE>


                        McNEIL REAL ESTATE FUND XI, LTD.
                                  SCHEDULE III
              REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
                                December 31, 1995

<TABLE>
<CAPTION>
                                            Gross Amount at
                                     Which Carried at Close of Period           Accumulated
                                                   Buildings and                        Depreciation
Description                        Land            Improvements          Total (a)      and Amortization
-----------                        -----           -------------         ---------      ----------------
APARTMENTS:
   <S>                        <C>                <C>              <C>                 <C>            
Acacia Lakes
   Mesa, AZ                  $     1,953,090    $    12,687,204   $     14,640,294    $   (8,213,224)

Gentle Gale
   Galveston, TX                     450,155          3,577,012          4,027,167        (2,167,312)

Knollwood
   Kansas City, MO                   330,547          6,423,419          6,753,966        (4,298,156)

The Park
   Joplin, MO                        165,329          4,238,254          4,403,583        (3,069,781)

Rock Creek
   Beaverton, OR                   1,365,810          9,663,748         11,029,558        (6,671,446)

Sun Valley
   Charlotte, NC                     562,797          8,204,402          8,767,199        (4,282,305)

Villa Del Rio
   Jacksonville, FL                  636,634          9,261,056          9,897,690        (5,531,458)

The Village
   Gresham, OR                       474,102          4,353,456          4,827,558        (2,861,502)
                              --------------     --------------   ----------------     -------------
                             $     5,938,464    $    58,408,551  $      64,347,015    $  (37,095,184)
                              ==============     ==============   ================     =============
</TABLE>


(a)  For Federal income tax purposes,  the properties are depreciated over lives
     ranging from 15-25 years using ACRS or MACRS methods. The aggregate cost of
     real estate  investments for Federal income tax purposes was  approximately
     $72,720,420 and accumulated depreciation was $58,365,830 December 31, 1995.








                     See accompanying notes to Schedule III.


<PAGE>


                        McNEIL REAL ESTATE FUND XI, LTD.
                                  SCHEDULE III
              REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
                                December 31, 1995


<TABLE>
<CAPTION>

                                 Date of                    Date                 Depreciable
Description                   Construction                Acquired              lives (years)
-----------                   ------------                --------              -------------
APARTMENTS:

Acacia Lakes
   <S>                          <C>                         <C>                     <C> 
   Mesa, AZ                     1980                        05/81                   3-33

Gentle Gale
   Galveston, TX                1980                        05/81                   3-21

Knollwood
   Kansas City, MO              1970                        05/81                   3-29

The Park
   Joplin, MO                   1977                        03/81                   3-35

Rock Creek
   Beaverton, OR                1975                        02/81                   3-30

Sun Valley
   Charlotte, NC                1980                        08/81                   3-40

Villa Del Rio
   Jacksonville, FL             1976                        05/81                   3-40

The Village
   Gresham, OR                  1974                        05/81                   3-30


</TABLE>














                     See accompanying notes to Schedule III.


<PAGE>




                        McNEIL REAL ESTATE FUND XI, LTD.

                              Notes to Schedule III

                           Real Estate Investments and
                            Accumulated Depreciation


A  summary  of  activity  for  the  real  estate   investments  and  accumulated
depreciation is as follows:

<TABLE>
<CAPTION>
                                                             For the Years Ended December 31,
                                                   ----------------------------------------------------
                                                        1995               1994               1993
                                                   --------------     --------------    ---------------
Real estate investments:
------------------------
<S>                                                <C>                <C>               <C>            
Balance at beginning of year...............        $   62,526,972     $   60,372,893    $    58,471,885

Improvements...............................             1,820,043          2,154,079          2,089,700

Replacements of assets.....................                     -                  -           (188,692)
                                                    -------------      -------------     --------------

Balance at end of year.....................        $   64,347,015     $   62,526,972    $    60,372,893
                                                    =============      =============     ==============



Accumulated depreciation:
-------------------------

Balance at beginning of year...............        $   34,610,759     $   32,269,274    $    30,279,422

Depreciation...............................             2,484,425          2,341,485          2,079,859

Replacements of assets.....................                     -                  -            (90,007)
                                                    -------------      -------------     --------------

Balance at end of year.....................        $   37,095,184     $   34,610,759    $    32,269,274
                                                    =============      =============     ==============

</TABLE>


<PAGE>

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

None.

                                    PART III

ITEM 10.   DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
--------   --------------------------------------------------

Neither the  Partnership  nor the General Partner has any directors or executive
officers.  The names and ages of, as well as the positions held by, the officers
and  directors of McNeil  Investors,  Inc.,  the general  partner of the General
Partner, are as follows:

<TABLE>
<CAPTION>
                                       Other Principal Occupations and Other
Name and Position             Age      Directorships During the Past 5 Years
-----------------             ---      -------------------------------------

<S>                            <C>      <C>
Robert A. McNeil,              75       Mr.  McNeil  is also  Chairman  of the Board and  Director  of McNeil  Real
Chairman of the                         Estate  Management,  Inc.  ("McREMI")  which is an affiliate of the General
Board and Director                      Partner.  He has held the foregoing  positions  since the formation of such
                                        entity  in  1990.  Mr.  McNeil  received  his  B.A.  degree  from  Stanford
                                        University  in 1942 and his  L.L.B.  degree  from  Stanford  Law  School in
                                        1948. He is a member of the State Bar of  California  and has been involved
                                        in  real  estate  financing  since  the  late  1940's  and in  real  estate
                                        acquisitions,  syndications  and  dispositions  since 1960. From 1986 until
                                        active  operations of McREMI and McNeil  Partners,  L.P.  began in February
                                        1991,  Mr.  McNeil was a private  investor.  Mr.  McNeil is a member of the
                                        International  Board of Directors  of the Salk  Institute,  which  promotes
                                        research in improvements in health care.

Carole J. McNeil               52       Mrs.  McNeil is  Co-Chairman,  with  husband  Robert A.  McNeil,  of McNeil
Co-Chairman of the                      Investors,  Inc.  Mrs.  McNeil has twenty years of real estate  experience,
Board                                   most  recently  as a  private  investor  from  1986 to 1993.  In 1982,  she
                                        founded Ivory & Associates, a commercial real  estate  brokerage   firm  in
                                        San Francisco,  CA. Prior to  that, she  was  a  commercial  real    estate  
                                        associate  with the  Madison   Company  and,  earlier,  a commercial  sales  
                                        associate and  analyst  with   Marcus  and   Millichap   in  San Francisco.
                                        In   1978,   Mrs.   McNeil   established     Escrow    Training    Centers,
                                        California's first   accredited  commercial  training   program  for  title   
                                        company escrow  officers and real estate  agents  needing  college  credits
                                        to qualify for   brokerage  licenses.  She  began in real estate as Manager 
                                        and Marketing Director of Title  Insurance  and  Trust in Marin County, CA.
                                        Mrs.  McNeil  serves  on  the International  Board of Directors of the Salk
                                        Institute.

</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                                       Other Principal Occupations and Other
Name and Position             Age      Directorships During the Past 5 Years
-----------------             ---      -------------------------------------

<S>                            <C>      <C>
Donald K. Reed,                50       Mr. Reed is  President,  Chief  Executive  Officer  and  Director of McREMI
Director, President,                    which is an affiliate of the General  Partner.  Prior to joining  McREMI in
and Chief Executive                     March 1993, Mr. Reed was President,  Chief  Operating  Officer and Director
Officer                                 of Duddlesten Management Corporation and Duddlesten Realty Advisors,  Inc.,
                                        with  responsibility  for  a  management portfolio   of  office,    retail,
                                        multi-family and mixed-use land projects representing  $2 billion in  asset
                                        value. He was  also  Chief  Operating  Officer, Director and  member of the
                                        Executive Committee of all Duddlesten  affiliates. Mr.  Reed  started  with
                                        the  Duddlesten companies  in 1976 and  served  as  Senior Vice   President 
                                        and   Chief   Financial Officer and as Executive  Vice President and  Chief
                                        Operating    Officer   of   Duddlesten   Management  Corporation before his 
                                        promotion to President in 1982.  He was   President   and  Chief  Operating
                                        Officer of Duddlesten  Realty  Advisors, Inc.,  which  has been  engaged in
                                        real  estate    acquisitions,   marketing   and   dispositions,  since  its
                                        formation  in 1989.

Ron K. Taylor                  38       Mr.  Taylor  is a Senior  Vice  President  of  McREMI  and has been in this
Vice President                          capacity since McREMI commenced  active  operations in 1991. He also serves
                                        as Acting  Chief  Financial  Officer  of McREMI  since the  resignation  of
                                        Robert C. Irvine on January 31, 1996.  Mr. Taylor is primarily  responsible
                                        for Asset Management functions at McREMI,  including property dispositions,
                                        commercial  leasing,  real estate finance and portfolio  management.  Prior
                                        to joining  McREMI,  Mr. Taylor served as an Executive Vice President for a
                                        national  syndication/property  management  company.  Mr.  Taylor  has been
                                        involved in the real estate industry since 1983.
</TABLE>

Each director  shall serve until his successor  shall have been duly elected and
qualified.

ITEM 11.     EXECUTIVE COMPENSATION
--------     ----------------------

No direct  compensation  was paid or payable by the  Partnership to directors or
officers  (since it does not have any  directors or officers) for the year ended
December  31,  1995,  nor was any  direct  compensation  paid or  payable by the
Partnership  to  directors  or officers  of the  general  partner of the General
Partner for the year ended  December 31, 1995. The  Partnership  has no plans to
pay any such remuneration to any directors or officers of the general partner of
the General Partner in the future.

See Item 13 - Certain  Relationships  and  Related  Transactions  for amounts of
compensation and  reimbursements  paid by the Partnership to the General Partner
and its affiliates.

<PAGE>

ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------     --------------------------------------------------------------

(A)      Security ownership of certain beneficial owners.

         No  individual  or  group,  as  defined  by  Section  13(d)(3)  of  the
         Securities  Exchange  Act of  1934,  known  to the  Partnership  is the
         beneficial  owner of more than 5 percent  of the  Partnership's  Units,
         other  than High River  Limited  Partnership,  which  owns 9,460  Units
         (approximately  5.9% of the outstanding Units) as of February 29, 1996.
         The business  address for High River Limited  Partnership  is 100 South
         Bedford Road, Mount Kisco, New York 10549.

(B)      Security ownership of management.

         The  General  Partner and the  officers  and  directors  of its general
         partner,  collectively,  own 313 Units which  represent less than 1% of
         the outstanding Units.

(C)      Change in control.

         None.

ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------     ----------------------------------------------

Under the terms of the Amended Partnership Agreement,  the Partnership is paying
the MID to the  General  Partner.  The maximum  MID is  calculated  as 1% of the
tangible asset value of the  Partnership.  The maximum MID percentage  decreases
subsequent to 1999.  Tangible  asset value is determined by using the greater of
(i)  an  amount  calculated  by  applying  a  capitalization  rate  of 9% to the
annualized net operating  income of each property or (ii) a value of $10,000 per
apartment unit for residential property to arrive at the property tangible asset
value. The property  tangible asset value is then added to the book value of all
other  assets  excluding  intangible  items.  Prior  to  July 1,  1993,  the MID
consisted of two  components:  (i) the fixed portion  which was payable  without
respect to the net income of the Partnership and was equal to 25% of the maximum
MID (the "Fixed  MID") and (ii) a contingent  portion  which was payable only to
the extent of the lesser of the Partnership's  excess cash flow, as defined,  or
net operating  income (the  "Entitlement  Amount") and was equal to up to 75% of
the maximum MID (the "Contingent MID").

Effective  July 1, 1993,  the General  Partner  amended the Amended  Partnership
Agreement as a settlement to a class action complaint. This amendment eliminates
the Fixed MID  portion  and makes the  entire  MID  payable to the extent of the
Entitlement  Amount.  In all other respects,  the calculation and payment of the
MID remain the same.

Contingent MID will be paid to the extent of the Entitlement  Amount, and may be
paid (i) in cash,  unless there is insufficient  cash to pay the distribution in
which  event any  unpaid  portion  not taken in Units  will be  deferred  and is
payable, without interest, from the first available cash and/or (ii) in Units. A
maximum of 50% of the MID may be paid in Units.  The  number of Units  issued in
payment of the MID is based on the  greater of $50 per Unit or the net  tangible
asset value,  as defined.  For the year ended December 31, 1995, the Partnership
accrued for the General Partner Contingent MID in the amount of $871,053.

<PAGE>

Any  amount of the MID which is paid to the  General  Partner  in Units  will be
treated as if cash is distributed to the General Partner and is then contributed
to the  Partnership by the General  Partner.  The Fixed MID was treated as a fee
payable to the General  Partner by the Partnership  for services  rendered.  The
Contingent  MID  represents  a return  of  equity  to the  General  Partner  for
increasing cash flow, as defined, and accordingly is treated as a distribution.

The  Partnership  pays property  management fees equal to 5% of the gross rental
receipts  of the  Partnership's  properties  to McREMI  for  providing  property
management and leasing  services.  Effective  February 14, 1991, the Partnership
began reimbursing McREMI for its costs, including overhead, of administering the
Partnership's  affairs.  For the year ended December 31, 1995,  the  Partnership
paid  or  accrued  for  McREMI  $1,176,453  in  property   management  fees  and
reimbursements.

See  Item 1 -  Business,  Item  7 -  Management's  Discussion  and  Analysis  of
Financial  Condition  and  Results  of  Operations,  and  Item  8  -  Note  2  -
"Transactions with Affiliates."



<PAGE>

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

See accompanying index to financial statements at Item 8.

<TABLE>
<CAPTION>

(A)        Exhibits

           Exhibit
           Number                           Description
           -------                          -----------

           <S>                              <C>                             
           3.                               Limited     Partnership    Agreement   
                                            (Incorporated by  reference  to  the
                                            Annual  Report on Form 10-K for  the
                                            fiscal   year  ended   September 30, 
                                            1987).

           3.1                              Amended    and    Restated   Limited  
                                            Partnership      Agreement,    dated 
                                            August    6, 1991  (Incorporated  by 
                                            reference   to the Quarterly  Report 
                                            on Form   10-Q for the quarter ended 
                                            June 30, 1991).

           3.2                              Amendment  No. 1 to the Amended  and 
                                            Restated  Partnership  Agreement  of
                                            McNeil Real   Estate  Fund XI, Ltd., 
                                            dated March 28, 1994. (2)

           3.3                              Amendment  No. 2 to the  Amended and
                                            Restated  Partnership   Agreement of
                                            McNeil Real Estate  Fund   XI, Ltd., 
                                            dated March 28, 1994. (2)

           10.1                             Deed of Trust Note,  dated  April 5,
                                            1989,  between  Knollwood    Fund XI
                                            Associates and American   Mortgages,
                                            Inc. (1)

           10.2                             Deed of Trust  Note,  dated   May 5,
                                            1989,  between  Sun  Valley  Fund XI
                                            Associates and American   Mortgages,
                                            Inc. (1)

           10.3                             Termination  Agreement,  dated as of
                                            August 6, 1991,  between   The  Park
                                            Fund    XI Associates  and    McNeil  
                                            Partners,  L.P.  regarding    McNeil
                                            Real Estate Fund XI, Ltd. (1)

           10.4                             Termination  Agreement,  dated as of
                                            August 6, 1991  between   Sun Valley
                                            Fund XI Associates and   McNeil Real 
                                            Estate Management, Inc. (1)
</TABLE>

<PAGE>


<TABLE>
<CAPTION>

(A)        Exhibits

           Exhibit
           Number                           Description
           -------                          -----------
           <S>                              <C>
           10.6                             Termination  Agreement,  dated as of
                                            August 6,   1991,  between Knollwood
                                            Fund XI   Associates and McNeil Real 
                                            Estate Management, Inc. (1)

           10.6                             Termination  Agreement,  dated as of
                                            August 6,  1991     among  Southmark
                                            Management   Corporation,  Southmark
                                            Commercial    Management    Company,
                                            McNeil   Real   Estate Fund XI, Ltd.
                                            and McNeil Real Estate Fund XI, Ltd.
                                            and McNeil   Real Estate Management,
                                            Inc. (1)

           10.7                             Property    Management    Agreement,  
                                            dated as of August 6, 1991,  between
                                            McNeil   Real Estate  Fund XI,  Ltd.
                                            and McNeil  Real Estate  Management,
                                            Inc. (1)

           10.8                             Property    Management    Agreement,
                                            dated as of August 6, 1991,  between
                                            Knollwood   Fund   XI Associates and
                                            McNeil Real Estate  Management,  
                                            Inc. (1)

           10.9                             Property Management Agreement, dated
                                            as of August 6,  1991,  between  Sun
                                            Valley Fund XI Associates and McNeil
                                            Real Estate Management, Inc.
                                            (1)

           10.10                            Property    Management    Agreement,  
                                            dated as of August 6,   1991 between
                                            The Park Fund   XI   Associates  and 
                                            McNeil Real Estate Management,
                                            Inc. (1)

           10.11                            Revolving  Credit    Agreement dated
                                            August 6, 1991,  between McNeil Real
                                            Estate    Fund XI,   Ltd. and McNeil
                                            Partners, L.P. (1)
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

(A)        Exhibits

           Exhibit
           Number                           Description
           -------                          -----------
           <S>                              <C>                                                                  
           10.12                            Amendment  of   Property  Management
                                            Agreement,  dated    March 5,  1993,
                                            between  McNeil  Real  Estate  Fund 
                                            XI,  Ltd.  and  McNeil  Real  Estate
                                            Management,  Inc.   (Incorporated by
                                            reference,  to the Annual  Report of
                                            McNeil Real Estate Fund   XI,   Ltd.
                                           (File No.  0-9783),  on Form 10-K for
                                            the period ended December 31, 1992)

           10.13                            Loan  Agreement  dated    June   24,
                                            1993,   between  Lexington  Mortgage
                                            Company and McNeil Real Estate Fund
                                            XI, Ltd. (2)

           10.14                            Master    Property        Management
                                            Agreement,  dated  as of   June  24,
                                            1993, between  McNeil Real    Estate
                                            Management,  Inc.  and   McNeil Real
                                            Estate Fund XI, Ltd. (2)

           10.15                            Multifamily  Note,  dated   November
                                            1, 1993 between Value Line  Mortgage
                                            Corporation and Acacia Lakes Fund XI
                                            Limited Partnership. (2)

           10.16                            Modification  of Deed of Trust Note,
                                            dated  December   15, 1993,  between
                                            American   Mortgages,    Inc.    and
                                            Knollwood Fund XI Associates. (2)

           10.17                            Modification  of Deed of Trust Note,
                                            dated December 20,  1993,    between
                                            American    Mortgages,  Inc. and Sun 
                                            Valley Fund XI Associates. (2)

           10.18                            Deed   of Trust Note, dated April 5,
                                            1989,   between   The   Park Fund XI
                                            Associates   and American Mortgages,
                                            Inc. (3)

           10.19                            Installment   Note,  dated  December
                                            28,  1990,   between   The  State of
                                            Oregon Public  Employees' Retirement
                                            Fund and McNeil   Real   Estate Fund
                                            XI, Ltd. (3)

           10.20                            Promissory    Note,  dated  November
                                            25,  1991,  between  Village Fund XI
                                            Associates Limited  Partnership  and
                                            Sun     Life  Insurance  Company  of
                                            America. (3)
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

(A)        Exhibits

           Exhibit
           Number                           Description
           -------                          -----------
           <S>                              <C>                                                                    
           11.                              Statement    regarding   computation  
                                            of Net  Income  (Loss)  per  limited
                                            partnership unit (see  Note   1   to
                                            Financial Statements).

           22.                              List    of    subsidiaries    of the
                                            Partnership. (2)

                           (1)              Incorporated  by   reference  to the 
                                            Annual  Report of McNeil Real Estate
                                            Fund XI,  Ltd.  (File No.  0-9783),
                                            on Form 10-K for the   period  ended
                                            December  31,    1991,   as    filed  
                                            with  the  Securities  and  Exchange
                                            Commission on March 29, 1992.

                           (2)              Incorporated   by  reference  to the 
                                            Annual  Report of McNeil Real Estate
                                            Fund XI,  Ltd.  (File  No.  0-9783),
                                            on Form 10-K for   the period  ended
                                            December  31,  1993, as  filed  with
                                            the   Securities     and    Exchange
                                            Commission on March 30, 1994.

                           (3)              Incorporated   by  reference  to the 
                                            Annual  Report of McNeil Real Estate
                                            Fund XI,  Ltd.  (File  No.  0-9783),
                                            on Form 10-K for   the period  ended
                                            December  31,  1994, as  filed  with
                                            the   Securities     and    Exchange
                                            Commission on March 30, 1995.

           27.                              Financial Data Schedule for the year
                                            ended December 31, 1995.

</TABLE>

(B)  Reports on Form 8-K.  There  were no  reports on Form 8-K filed  during the
     quarter ended December 31, 1995.


<PAGE>



                        McNEIL REAL ESTATE FUND XI, LTD.
                              A Limited Partnership

                                 SIGNATURE PAGE


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

<TABLE>
<CAPTION>

                                                   McNEIL REAL ESTATE FUND XI, LTD.


                                                   By:  McNeil Partners, L.P., General Partner

                                                        By: McNeil Investors, Inc., General Partner



<S>                                                <C>
March 29, 1996                                     By:  /s/  Robert A. McNeil
--------------                                         --------------------------------------------------
Date                                                    Robert A. McNeil
                                                        Chairman of the Board and Director
                                                        (Principal Executive Officer)


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.



March 29, 1996                                     By:  /s/  Donald K. Reed
--------------                                         --------------------------------------------------
Date                                                    Donald K. Reed
                                                        President and Director of McNeil Investors, Inc.



March 29, 1996                                     By:  /s/  Ron K. Taylor
--------------                                         --------------------------------------------------
Date                                                    Ron K. Taylor
                                                        Acting Chief Financial Officer
                                                            of McNeil Investors, Inc.



March 29, 1996                                     By:  /s/  Brandon K. Flaming
--------------                                         --------------------------------------------------
Date                                                    Brandon K. Flaming
                                                        Chief Accounting Officer of McNeil Real Estate
                                                           Management, Inc.


</TABLE>