FORBEARANCE AGREEMENT

     THIS FORBEARANCE AGREEMENT (the "Agreement") is made and entered into as of
the first day of February,  1997,  by and between  Summit Tax Exempt L. P. II, a
Delaware  limited  partnership  ("Summit") An Cedar Pointe  Properties,  Ltd., a
Georgia limited partnership ("Borrower").



                                    RECITALS:


     A.  Borrower is the developer  and owner of a  multifamily  rental  housing
development  known  as Cedar  Pointe  Apartments  located  in  Davidson  County,
Tennessee (the "Project").

     B. The cost of acquiring, constructing, improving and equipping the Project
was financed by The Industrial Development Board Of The Metropolitan  Government
of  Nashville  and  Davidson  County  (the  "Issuer")  by  the  issuance  of its
Multifamily  Housing Revenue  Refunding Bonds (Cedar Pointe Project) Series 1987
(the  "Bonds"),  in the principal  amount of $9,500,000,  by Resolution  adopted
March 10, 1987.

     C. The terms of the Bonds, the security therefore,  the rights and remedies
of the holders thereof,  and various other matters in connection  therewith were
prescribed  pursuant  to a Trust  Indenture  dated  as of  April  1,  1987  (the
"Indenture"),   between  the  Issuer  and  First  American  National  Bartok  of
Nashville, as Trustee (the "Trustee").

     D. The Bonds  were  issued  and sold on April  22,  1987 to  Summit,  which
continues to own all of the outstanding Bonds.

     E. Proceeds of the Bonds were used to provide funds to make a mortgage loan
in the principal  amount of $9,500,000 (the "Mortgage  Loan") pursuant to a Loan
Agreement  between  the  Borrower  and the Issuer  (the "Loan  Agreement").  The
Mortgage Loan is evidenced by a promissory note (the "Note") and is secured by a
Building Loan Deed of Trust and Security Agreement (the "Mortgage").

     F. The Project was completed  and has been owned and operated  continuously
by Borrower.

     G. As of December 1, 1996,  the Borrower had failed to pay certain  amounts
of Base Interest (as defined in the Indenture) on the Note when due

                                     Page 1

<PAGE>



on October 15 and November 15, 1996,  each of which  occurrences  constitute  an
Event of Default  pursuant to the Indenture and Loan Agreement (the  "Designated
Default").

     H. Upon the  occurrence of an uncured Event of Default,  the "Acting Party"
(as  defined  in the  Indenture)  may elect to pursue  one or more  remedies  as
provided in Article VII of the Indenture,  Article X of the Loan Agreement,  and
Article  Six  of  the  Mortgage  (hereinafter  collectively  referred  to as the
"Remedies Provisions"), including, but not limited to, the right to repossession
and sale of the Project under the Mortgage.

     I. Pursuant to Section 7.02 of the Indenture,  Summit,  as the owner of all
the Bonds,  is the  designated  "Acting  Party" with the sole  authority to take
action in respect of an Event of Default.

     J. Whitney Cedar, LLC, is a recently formed Tennessee limited liability
company ("Whitney").

     K.  Borrower  and Whitney  have  negotiated  a  contingent  agreement  (the
"Purchase  Agreement")  whereby Whitney will be admitted as the Managing General
Partner of Borrower,  with Whitney to own a forty-nine percent (49%) interest in
the  partnership  in  consideration  of a  $450,000  capital  contribution  (the
"Capital  Contribution")  to be utilized for, among other expenses,  the partial
payment of past-due interest on the Note,  substantial  repairs to the Project's
apartment units, and funding of an escrow account to pay real property taxes due
in 1997.

     L.  Accordingly,  contingent  on  consummation  of the  Purchase  Agreement
between Borrower and Whitney and Borrower's receipt of the Capital  Contribution
to be disbursed as agreed  therein,  Borrower has requested that Summit,  in its
capacity  as Acting  Party,  enter into an  interim  agreement  to forbear  from
enforcing  its  remedies  under the  Remedies  Provisions  with  respect  to the
Designated  Default,  which  interim  agreement  shall not  supersede,  amend or
supplement the Indenture or Loan Agreement.

     M. In addition,  Borrower has  requested  that Summit agree to forbear from
enforcing its remedies under the Remedies  Provisions upon the future occurrence
of defaults for the  non-payment of certain  portions of Base Interest when due,
pending issuance of a Supplemental  Indenture by the Issuer and amendment of the
Loan Documents (as defined in the Loan  Agreement) to reflect  modifications  to
the interest  rates payable on the Bonds,  extension of the maturity date of the
Bonds,  modification  of the dates  applicable  to redemption of the Bonds prior
thereto and other matters related thereto.



                                     Page 2

<PAGE>



     N. Summit,  conditioned on consummation of the Purchase  Agreement  between
Borrower  and Whitney and  disbursement  of the  Capital  Contribution  on terms
acceptable to Summit,  is willing to forbear from  exercising its remedies under
the  Remedies  Provisions,  and to consent  to the  issuance  of a  Supplemental
Indenture and amendment of the Loan  Documents,  on the terms and conditions set
forth herein.


     NOW, THEREFORE, in consideration of the Recitals and of the mutual promises
and covenants contained herein, Summit and Borrower agree as follows:


1. Recitals.

     The  foregoing  Recitals  are  hereby  incorporated  herein and made a part
hereof.


2. Term.

     This Agreement  shall commence and be effective as of the Closing Date, and
shall  continue in full force and effect until the  occurrence  of a Forbearance
Termination Event (the "Forbearance Period"). For purposes of this Agreement:

     (a) The "Closing  Date" shall mean the date on which Whitney is admitted to
and made Managing General Partner of the Borrower; and

     (b) a "Forbearance  Termination Event" shall mean the occurrence of any one
or more of the following events which is not cured within  applicable notice and
cure periods, if any:

          (1) The Borrower's  failure to provide for disbursement of the Capital
          Contribution  on the terms set forth in  Section 4 herein,  within ten
          (10) days after the Closing Date;

          (2) The Issuance of a  Supplemental  Indenture in accordance  with the
          provisions of Article IX of the  Indenture,  and amendment of the Loan
          Documents  to  incorporate  the  proposed  modifications,   terms  and
          conditions  set  forth  in this  Agreement  (collectively,  the  "Bond
          Restructuring");

          (3) The failure or  inability  of the parties to  accomplish  the Bond
          Restructuring for any reason whatsoever, on or before June 15, 1997;


                                     Page 3

<PAGE>



          (4)  Borrower's  commitment  of a  material  default  or breach of any
          material  representation,  warranty or covenant under this  Agreement,
          the Indenture or the Loan Documents; or

          (5) Borrower's  failure,  during the Forbearance  Period,  to make all
          required payments of Base Interest,  Operating Expenses,  and deposits
          to the  Replacement  Reserve Fund,  in  accordance  with the terms and
          conditions of Section 5 hereof.


3. Agreement to Forbear.

     During the Forbearance  Period,  Summit will forbear in the exercise of its
rights and remedies  under the Indenture and Loan  Documents with respect to the
Designated  Default and any Deferred  Defaults (as defined in Section 5 hereof).
Without limiting the generality of the foregoing,  during the Forbearance Period
and so long as no Forbearance  Termination  Event occurs and  continues,  Summit
will  not (i)  accelerate  the  maturity  of the  Loan or the  Bond or  initiate
proceedings  for the  collection of the Mortgage Loan or the Bond;  (ii) file or
join in filing any involuntary  petition in bankruptcy with respect to Borrower,
or otherwise initiate or participate in similar insolvency,  reorganization,  or
moratorium proceedings for the benefit of creditors of Borrower; (iii) repossess
or sell,  through  judicial  proceedings  or  otherwise,  the  Project;  or (iv)
exercise any other of its rights pursuant to the Remedies Provisions.

     Notwithstanding  anything  herein to the  contrary,  Summit's  agreement to
forbear as set forth in this Section 3 pertains only to the  Designated  Default
and any Deferred Defaults described in Section 5 hereof.

4. Use of Proceeds of Capital Contribution.

     It is a condition of this Agreement that Whitney's Capital  Contribution to
the  Borrower in the amount of  $450,000 be utilized  for the payment of Project
and related  expenses and  obligations in the  approximate  amounts set forth in
Exhibit A, affixed hereto and made a part hereof, subject to the following:

     (a) The sum of $150,000 for "repairs"  shall be delivered to Summit,  to be
held in an interest-bearing repair escrow account (the "Repair Escrow Account").
Summit and Borrower agree that the upgrades and repairs  designated in Exhibit B
(the  "Designated  Repairs"),  affixed  hereto and made a part hereof,  shall be
performed  and  completed  as quickly as is  feasible,  and Summit shall pay the
reasonable costs thereof from the Repair Escrow Account.  Any amounts  remaining
in the  Repair  Escrow  Account  after the  payment  of all  costs and  expenses
incurred in connection  with the Designated  Repairs shall be held therein,  and
shall be used for future upgrades and

                                     Page 4

<PAGE>

repairs to be  performed  with the prior  written  consent  of  Summit,  through
December 31, 1999.  The Repair  Escrow  Account shall be closed as of January 1,
2000, and any amounts remaining therein less any amounts required to be held for
the  payment of agreed  upgrades  and repairs  not  completed  or invoiced as of
December 31, 1999,  shall be paid to Summit as a Repair Escrow  Account  Service
Fee.

     (b) The amount of $40,000 budgeted for legal expenses  includes an estimate
and allocation of $10,000 to cover Whitney's organizational expenses,  amendment
of Borrower's partnership agreement,  and related costs and expenses incurred by
Borrower and/or Whitney in connection  therewith  ("Borrower's Legal Expenses").
In the event that Borrower's Legal Expenses are less than $10,000, the remainder
shall be used to  supplement  the $30,000  budget for legal  costs and  expenses
incurred  in  connection  with this  Agreement,  preparation  of the  Supplement
Indenture  and  amendment  of the Loan  Documents  as  contemplated  herein (the
"Forbearance and Bond Restructuring Legal Expenses").

     In the event that Borrower's Legal Expenses exceed $10,000,  Borrower shall
be responsible for the payment of such excess.

     In the event that the  Forbearance  and Bond  Restructuring  Legal Expenses
exceed the amount  available  for payment as provided  herein,  Summit  shall be
responsible for the payment of such excess.

     (c) Any  amounts  remaining  unused  after  the  payment  of all line  item
expenses  and escrow  deposits  set forth in Exhibit  A, with the  exception  of
amounts  designated  to fund the Repair Escrow  Account  described in subsection
4(a) above, may be used, with the prior written consent of Summit, (i) for other
Project costs and expenses now or hereafter incurred,  or (ii) to supplement the
Repair Escrow Account.


5. Payment of Interest and Operating Expenses During the Forbearance Period.

     (a) Borrower,  within ten (10) days following the Closing Date, will make a
payment in the  amount of  $104,765  to be applied as a partial  payment of Base
Interest (as defined in the  Indenture)  for the period  September 16 - November
15, 1996.

     (b) The parties  acknowledge  and agree that (i) on or about  December  16,
1996,  Borrower made a payment in the amount of $63,333.33  which was applied to
Base  Interest for the period  November 16 - December  15, 1996,  and (ii) on or
about  January 16,  1997,  Borrower  made a payment in the amount of  $57,263.89
which was  applied to Base  Interest  for the period  December  16 - January 15,
1997.

                                     Page 5

<PAGE>





     (c)  Commencing  February  15,1997,  and on the 15th day of each and  every
month  thereafter  during the  Forbearance  Period,  Borrower  will make minimum
monthly partial payments of Base Interest consisting of:

          (1)  an amount calculated  as though such payment is interest-only  at
          the rate of seven percent (7.0%) per annum, based upon a  360-day year
          for the actual  number  of days  elapsed  for the  month through  each
          payment due date; plus

          (2)  Twenty-five  percent  (25%) of Net Cash Flow (as  defined  in the
          Indenture)  remaining after payment of the interest amount  calculated
          pursuant to subsection 5(c)(1) above.

     Borrower  acknowledges and understands that subject to and pending issuance
of a Supplemental Indenture and amendment of the Bonds and Loan Documents on the
terms and conditions set forth in Section 6 hereof,  the rate for the payment of
Base Interest  pursuant to the  Indenture and Bonds is eight percent  (8.0%) per
annum  based  upon a 360-day year for the  actual  number of days  elapsed,  the
minimum monthly interest  payments  calculated in accordance with this Section 5
(the "Minimum Pay Rates") will or may be less than the Base Interest required to
be paid under the  Indenture  and Bonds,  the  failure to pay the full amount of
Base  Interest  constitutes  an Event of Default  under the  Indenture  and Loan
Documents,  and all  Base  Interest  which  remains  unpaid  from  time to time,
together with interest thereon as provided in the Indenture, shall accrue and be
paid as provided in the Indenture and Bonds.

     (c) Notwithstanding  anything herein to the contrary,  for purposes of this
Agreement any Event of Default  resulting  from  Borrower's  failure to pay Base
Interest in excess of the Minimum Pay Rates,  in  connection  with Base Interest
due and  payable for the period  commencing  November  16,  1996 and  continuing
through  the last day of the  Forbearance  Period,  shall be termed a  "Deferred
Default" subject to Summit's agreement to forbear from exercising its rights and
remedies, as set forth in Section 3 hereof.

     (d) It is a further condition of this Agreement that:

          (1) all  operating  expenses  of   the  Project  (as  defined  in  the
          Indenture),  other than the  payment of Base  Interest,  are paid when
          due;

          (2) all deposits to the  Replacement  Reserve Fund required by Section
          6.05 of the Indenture and Section  2.3(g) of the Loan  Agreement,  are
          paid when due; and

          (3) all deposits to the Tax and Insurance Escrow established  pursuant
          to Section 2.4.5 of the Mortgage are paid when due.



                                     Page 6

<PAGE>


6.   Summit's  Consent to Issuance of a Supplemental  Indenture and Amendment of
     the Loan Documents.

     During the Forbearance Period,  Summit agrees to consent to the issuance of
a   Supplemental   Indenture   by  and  between  the  Agency  and  the  Trustee,
restructuring  of the  Bonds,  and  certain  proposed  amendments  to  the  Loan
Documents (and other related loan documents as  appropriate)  incorporating  the
following terms and conditions:

     (a) Base  Interest on the Bonds from January 16, 1997 through the remainder
of the Second  Period (as  defined in the  Indenture),  established  pursuant to
Section 3.06(b)(2) of the Indenture, shall be 7.0% per annum.

     (b)  All  provisions  requiring  or  related  to  the  payment  of  Primary
Contingent  Interest  (as defined in the  Indenture)  will be deleted  effective
January 16, 1997.

     (C) The interest rate  applicable  to the payment of "Maximum  Supplemental
Contingent  Interest"  (as  defined  in the  Indenture)  will be  reduced  to 5%
effective January 16, 1997.

     (d) Summit  will waive and  forgive  any Base  Interest,  Primary  Deferred
Interest  and  Supplemental  Deferred  Interest  (as  defined in the  Indenture)
accrued and unpaid through January 15, 1997.

     (e) Summit will waive and  forgive any  Construction  Period  Deferred  and
Contingent  Interest (as defined in the  Indenture)  accrued and unpaid  through
January 15, 1997.

     (f) Summit's  option to elect  Mandatory  Redemption  of the Bonds prior to
maturity  pursuant to Section  4.01(h) of the  Indenture  shall be extended to a
date no earlier than the first day of November, 2006.

     (g) Borrower's  option to elect  Optional  Redemption of the Bonds prior to
maturity pursuant to Section 4.03 of the Indenture shall be restricted to a date
no earlier  than  March 1,  1999,  at a  Redemption  Price  equal to 100% of the
principal amount of the Bonds to be redeemed.

     (h) The Maturity  Date (as defined in the  Indenture) of the Bonds shall be
extended to April 1, 2017.

     (i)  The  "Cost  Basis"  applicable  to  the  calculation  of Net  Sale  or
Refinancing  Proceeds  (as defined in the  Indenture)  shall be  established  as
$9,950,000 as of the Closing Date.

                                     Page 7

<PAGE>





     (j)  The  Trustee  will  be  replaced  by  First  Tennessee  Bank  National
Association pursuant to Article VIII of the Indenture.

     (k) The Issuer,  Trustee and Borrower may enter into such other  revisions,
modifications and amendments as may be consented to in writing by Summit.

     The proposed  Supplemental  Indenture,  Bonds,  and amended Loan Documents,
together  with  all  required  legal  opinions  and  such  other   materials  or
information  as may be  necessary,  shall be prepared by or at the  direction of
Borrower,  with the consent and  assistance  of Summit  where  appropriate,  for
submission to the Issuer and Trustee in  accordance  with the Indenture and Loan
Documents.


7. Effect and Construction of Agreement.

          Except as expressly  provided herein, the Indenture and Loan Documents
shall remain in full force and effect in accordance with their respective terms,
and this Agreement shall not be construed to:

     (a) impair the  validity,  perfection  or  priority of any lien or security
interest securing the Note;

     (b) waive or impair any  rights,  powers or  remedies  of Summit  under the
Indenture or Loan Documents (as the same may be amended as provided herein) upon
termination of the Forbearance  Period,  with respect to the Designated Default,
the Deferred Defaults or otherwise; or

     (c)  constitute  an  agreement  by Summit or  require  Summit to extend the
Forbearance Period or grant additional  forbearance  periods, or extend the time
for payment of any of Borrower's obligations.


8. Covenants of Borrower.

     Unless Summit otherwise consents in writing,  Borrower covenants and agrees
that during the Forbearance Period it will:

     (a)  Comply  with all  covenants  and  obligations  of  Borrower  under the
Indenture and Loan  Documents,  provided that Borrower  shall not be required to
cure the Designated Default or Deferred Defaults during the Forbearance Period;

     (b) comply  with all  covenants  and  obligations  of  Borrower  under this
Agreement; and


                                     Page 8
<PAGE>

     (C) use its best efforts to accomplish the Bond  Restructuring on or before
June 15,1997.


9. Defaults and Remedies.

     Upon the occurrence of a Forbearance  Termination  Event under  subsections
2(b)(1),  (3), (4) or (5) above,  Summit  shall have the right to terminate  and
rescind this  Agreement,  at Summit's  sole  option,  in which event the parties
hereto shall be restored to their  respective  former positions and rights under
the Indenture, Bonds and Loan Documents, and Summit shall have the further right
to exercise and enforce any rights or remedies available thereunder.

     Upon the  occurrence  of the Bond  Restructuring  described  in  subsection
2(b)(2) above,  this Agreement shall terminate in accordance with its terms, and
the parties  hereto shall continue and be subject to the terms and conditions of
the Supplemental  Indenture,  Bonds,  and Loan Documents,  as issued and amended
pursuant to the Bond Restructuring.


10. Non-Waiver of Other Events of Default.

     Summit's  forbearance  of the  enforcement  of  any or all of its  remedies
pursuant to the Remedies  Provisions in connection  with any uncured  Designated
Default or Deferred  Default is expressly  limited to the provisions,  terms and
conditions set forth in this  Agreement,  and, in accordance with the Indenture,
Bonds, and Loan Documents,  no such forbearance  shall extend to any other Event
of Default or impair any right consequent thereto.


11. Miscellaneous.

     (a) Further Assurance.  Borrower and Summit agree to execute such other and
further  documents and  instruments as either party may request to implement the
provisions  of this  Agreement and to perfect and protect the liens and security
interests Heated by the Loan Documents and Indenture.

     (b) Benefit of Agreement. This Agreement shall be binding upon and inure to
the  benefit of and be  enforceable  by the  parties  hereto,  their  respective
successors and assigns. No other person or entity shall be entitled to claim any
right or  benefit  hereunder,  including,  without  limitation,  the status of a
third-party beneficiary of this Agreement.

     (c)  Integration.  This  Agreement,  together  with the  Indenture and Loan
Documents, constitutes the entire agreement and understanding among

                                     Page 9


<PAGE>

the parties  relating to the subject  matter  hereof,  and  supersedes all prior
proposals, negotiations,  agreements and understandings relating to such subject
matter.  In  entering  into this  Agreement,  Borrower  acknowledges  that it is
relying on no statement, representation,  warranty, covenant or agreement of any
kind made by any  employee  or agent of  Summit,  except for the  agreements  of
Summit set forth herein.

     (d)  Severability.  The  provisions  of this  Agreement  are intended to be
severable.  If any  provisions  of  this  Agreement  shall  be held  invalid  or
unenforceable in whole or in part in any jurisdiction,  such provision shall, as
to such  jurisdiction,  be  ineffective  to the  extent  of such  invalidity  or
enforceability without in any manner affecting the validity or enforceability of
such  provision in any other  jurisdiction  or the remaining  provisions of this
Agreement in any jurisdiction.

     (e)  Determination  of  Taxability.  The  various  provisions,   terms  and
conditions  of this  Agreement  are intended  merely to  supplement,  and not to
effect any revision,  modification  or amendment to the provisions,  terms,  and
conditions of the Bonds,  Indenture and Loan  Documents  except as expressly set
forth herein. If any provision, term or condition of this Agreement requires any
action,  or  the  forbearance   thereof,   which  could  or  will  result  in  a
Determination of Taxability (as defined in the Indenture),  then such provision,
term or condition  shall be  rescinded,  void and of no further force or effect,
and  shall  be  deemed  severable  from  the  remaining  provisions,  terms  and
conditions,  and in no way shall effect the validity of the other  provisions of
this Agreement.

     (f)  Governing  Law. This  Agreement  shall be governed by and construed in
accordance with the internal substantive laws of the State of Tennessee, without
regard to the choice of law principles of such state.

     (g) Counterparts:  Telecopied signatures. This Agreement may be executed in
any  number of  counterparts  and by  different  parties  to this  Agreement  on
separate  counterparts,  each of which  when so  executed,  shall be  deemed  an
original, but all such counterparts shall constitute one and the same agreement.
Any signature delivered by a party by facsimile  transmission shall be deemed to
be an original signature hereto.

     (h) Notices.  Any notices with respect to this Agreement  shall be given in
the manner provided for in Section 11.8 of the Loan Agreement.

     (i) Amendment. No amendment, modification, rescission, waiver or release of
any provision of this Agreement  shall be effective  unless the same shall be in
writing and signed by the parties hereto.



                                     Page 10

<PAGE>



     IN WITNESS  WHEREOF,  the parties hereto have executed this Agreement as of
the day and year first above written

SUMMIT TAX EXEMPT L.P. II,
a Delaware Limited Partnership

By: Related Tax Exempt Associates II, Inc.
    a General Partner


    By:/s/ J. Michael Fried
       -----------------------------
       Name
       Title


CEDAR POINTE PROPERTIES, LTD.,
a Georgia Limited Partnership


    By:/s/  Asbury D. Snow, Jr.
       ----------------------------
       Asbury D. Snow, Jr.
       General Partner



                                     Page 11

<PAGE>



                          CONSENT OF WHITNEY CEDAR LLC


     Whitney Cedar, LLC, ("WC"), a Tennessee limited liability  company,  as the
prospective  Managing General Partner of Cedar Pointe  Properties,  Ltd. ("CPP")
pursuant  to the  Purchase  Agreement  between  CPP  and WC  referred  to in the
foregoing Forbearance Agreement, hereby consents to the terms of the Forbearance
Agreement and to the execution thereof by Asbury D. Snow, Jr. on behalf of CPP.


WHITNEY CEDAR, LLC
a Tennessee limited liability company



By: /s/ Thomas Granville
   -----------------------------
   Thomas Granville,
   Chief Manager




                                     Page 12

<PAGE>






                                CONSENT OF ISSUER


     The  Industrial  Development  Board  of  the  Metropolitan   Government  of
Nashville  and  Davidson  County,  as the Issuer  referred  to in the  preceding
Forbearance  Agreement,  hereby  consents  to  the  terms  of  this  Forbearance
Agreement.


                                             THE INDUSTRIAL DEVELOPMENT
                                             BOARD OF THE METROPOLITAN
                                             GOVERNMENT OF NASHVILLE AND
                                             DAVIDSON COUNTY

                                             By: /s/ Wm. E. McDonald
                                                 ------------------------------
                                                  Chairman


(seal)

Attest:


/s/ Nettie Scalf
----------------------------
Assistant Secretary


                                     Page 13

<PAGE>



                                    EXHIBIT A

                             CEDAR POINTE APARTMENTS

          Repairs                                   $150,000
          Partial lnterest 9/16-11/15/1996           104,765
          Legal                                       40,000
          Real Estate Tax Escrow Account             104,000
          Payables                                    51,235
                                                      ------
          Total                                     $450,000



                                     Page 14

<PAGE>



                                    EXHIBIT B

                           NORMAN TANDY AND ASSOCIATES
          550 FAIRWAY DRIVE, SUITE 101, DEERFIELD BEACH, FLORIDA 33441
                              PHONE (305) 426-8936
                            TELECOPIER (305) 426-5578

                                                               December 30, 1996

Bruce Brown
Related Capital Corp.
625 Madison Avenue
New York, NY 10022

                                                     Re: Cedar Pointe Apartments

Dear Bruce:

     I am enclosing a color chart for a Solid Wood Stain by Martin Senour Paints
which I sent to Jeff Isaacs of LEDC.

     I am also enclosing photographs that I took during my inspection of the
site on December 17, 1996, at which time I met with Jeff concerning those items
on his Cedar Pointe Needed Improvement list.


     The following are my observations:

     1. The gate arms need to be replaced, and the cost of new cards for the
residents. There is an intercom from the entry gate to the tenants which should
be checked for proper operation before investing the funds for new gates and
cards. This will control access to the site, however the arms are always subject
to breakage, and maintenance problems.

     2. Clubhouse refurbishing is a management call.

     3. Landscaping - This is to freshen up the landscaping at the entrance,
around the clubhouse and mulching the shrub beds around the site. A list of what
will be included should be made.

     4. Asphalt  repair - The area between  buildings No. 8 & 11 needs  repairs,
and I believe that this can be done for less than the $5,000 shown on the list.


               CONSTRUCTION CONSULTANTS, MANAGEMENT, INSPECTIONS


                                     Page 15

<PAGE>


                                EXHIBIT B-PAGE 2


     5. Signs - An itemized price should be firmed up with a painter for this
item.

     6. Fitness Center - The ceiling panels in the Fitness Center needs to be
replaced.

     7. Exterior Paint - The use of a Solid Stain should reduce the cost of this
item. Perhaps the choice of the stain color should be decided now.

     8. Swimming Pool Fence - The repair to this item could be done in house by
maintenance.

     9. Pool Replastering - A firm price from several contractors should be
replaced. There are several different materials that can be used for this work.

     10. Carpet Replacement -The carpeting can be replaced as the apartments in
question are leased.

                                                               Very Truly Yours,



                                                                 Herman Hochberg
                                                       Norman Tandy & Associates



               CONSTRUCTION CONSULTANTS, MANAGEMENT, INSPECTIONS

                                       2



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<PAGE>



                                EXHIBIT B-PAGE 3


                                  CEDAR POINTE
                               Needed Improvements


     1. Entrance Gates - $3,500
        Replace existing gate arms and purchase cards for residents.

     2. Clubhouse - $4,500
        The interior of the clubhouse needs to be redecorated (paint, carpet,
        etc.) in order to compete in the submarket.

     3. Landscaping - $7,500
        The entrance  needs to be dressed up and the entire property needs to be
        mulched.

     4. Asphalt Repair - $5,000
        Repairs need to be made throughout the complex.

     5. Signage - $2,500
        All signs need to be repainted and/or replaced.

     6. Fitness Center - $3,500
        The room needs redecorating and equipment repaired.

     7. Exterior Paint and Wood Repair - $85,000
        This was the lowest bid received by Sanbury.

     8. Swimming Pool Fence - $3,500
        Fence needs to be reanchored in retaining wall.

     9. Pool Replastering - $10,000
        The  Board  of  Health  will  not  issue  a 1997  permit  if this is not
        completed.

     10. Carpet Replacement - $25,000
         This will be used to replace carpet in approximately twenty-five units.




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<PAGE>


                                EXHIBIT B -PAGE 4

                           NORMAN TANDY AND ASSOCIATES
          550 FAIRWAY DRIVE, SUITE 101, DEERFIELD BEACH, FLORIDA 33441
                              PHONE (305) 426-8936
                            TELECOPIER (305) 426-8936

                                                               December 26, 1996

Mr. Jeff Isaacs
LEDC Management Group
111 Westwood Place Suite # 107
Brentwood, Tenn. 37027

                                                     Re: Cedar Pointe Apartments

Dear Jeff:

     I am enclosing a color chart for a Solid Color Wood Stain by Martin Senour
Paints. Please have American Coatings, Inc. submit a bid to do the exterior
paint proposal for Cedar Pointe using two coats of Solid Stain instead of paint.
The cleaning and preparation of surfaces as shown on the rear of the brochure,
and the cleaning outlined in American's bid appears to be similar.

     The repairs to the wood, caulking, and painting of the metal doors,
breezeway ceilings, signage etc. will remain the same.

     Please call me when you receive this letter so that we can discuss it.

                                                               Very Truly Yours,



                                                                 Herman Hochberg
                                                       Norman Tandy & Associates


C.C. Bruce Brown



               CONSTRUCTION CONSULTANTS, MANAGEMENT, INSPECTIONS




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