SECURITIES AND EXCHANGE COMMISSION

                        Washington, D.C.  20549



                              FORM 10Q/A

                            AMENDMENT NO. 1


           Filed pursuant to Section 12, 13, or 15(d) of the
                    Securities Exchange Act of 1934



                       ARVIDA/JMB PARTNERS, L.P.
         -----------------------------------------------------
        (Exact name of registrant as specified in its charter)



                                     IRS Employer Identification      
Commission File No. 0-16976                 No. 36-3507015            



     The undersigned registrant hereby amends the following sections of its
Report for June 30, 1997 on Form 10-Q as set forth in the pages attached
hereto:


                     ITEM 1.  FINANCIAL STATEMENTS

                             Pages 3 to 20



     Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

                      ARVIDA/JMB PARTNERS, L.P.

                      BY:   Arvida/JMB Managers, Inc.
                            (The General Partner)



                            By:  GAILEN J. HULL
                                 Gailen J. Hull, Senior Vice President
                                 and Principal Accounting Officer



Dated:  September 15, 1997



<PAGE>


<TABLE>
PART I.  FINANCIAL INFORMATION

     ITEM 1.  FINANCIAL STATEMENTS

                                         ARVIDA/JMB PARTNERS, L.P.
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES

                                        CONSOLIDATED BALANCE SHEETS

                                    JUNE 30, 1997 AND DECEMBER 31, 1996

                                                (UNAUDITED)

                                                  ASSETS
                                                  ------

<CAPTION>
                                                                             JUNE 30,      DECEMBER 31,
                                                                               1997           1996     
                                                                          -------------    ----------- 
<S>                                                                       <C>             <C>          
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . .      $ 14,427,301     53,635,737 
Restricted cash . . . . . . . . . . . . . . . . . . . . . . . . . . .        12,940,165     11,833,522 
Trade and other accounts receivable (net of allowance for doubtful 
  accounts of $248,351 at June 30, 1997 and $261,326 at 
  December 31, 1996). . . . . . . . . . . . . . . . . . . . . . . . .         7,497,602      3,582,995 
Mortgages receivable, net . . . . . . . . . . . . . . . . . . . . . .           757,180      1,269,460 
Real estate inventories . . . . . . . . . . . . . . . . . . . . . . .       182,292,695    174,638,454 
Property and equipment held for disposition or sale . . . . . . . . .        41,279,342          --    
Property and equipment, net . . . . . . . . . . . . . . . . . . . . .        38,110,789     79,373,444 
Investments in and advances to joint ventures, net. . . . . . . . . .         2,735,074      2,739,842 
Equity memberships. . . . . . . . . . . . . . . . . . . . . . . . . .         4,984,918      5,457,880 
Amounts due from affiliates . . . . . . . . . . . . . . . . . . . . .         1,182,128      1,003,732 
Prepaid expenses and other assets . . . . . . . . . . . . . . . . . .         7,824,833      7,105,077 
                                                                           ------------   ------------ 

          Total assets. . . . . . . . . . . . . . . . . . . . . . . .      $314,032,027    340,640,143 
                                                                           ============   ============ 



<PAGE>


                                         ARVIDA/JMB PARTNERS, L.P.
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES

                                  CONSOLIDATED BALANCE SHEETS (CONTINUED)

(UNAUDITED)

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

                                                                             JUNE 30,      DECEMBER 31,
                                                                               1997           1996     
                                                                          -------------    ----------- 
Liabilities:
  Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . .      $ 17,581,054     21,532,400 
  Deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        22,093,897     17,287,325 
  Accrued expenses and other liabilities. . . . . . . . . . . . . . .        15,119,741     15,324,815 
  Notes and mortgages payable, net. . . . . . . . . . . . . . . . . .        30,177,914     36,843,778 
                                                                           ------------   ------------ 
  Commitments and contingencies 

          Total liabilities . . . . . . . . . . . . . . . . . . . . .        84,972,606     90,988,318 
                                                                           ------------   ------------ 

Partners' capital accounts:
  General Partner and Associate Limited Partners:
    Capital contributions . . . . . . . . . . . . . . . . . . . . . .            20,000         20,000 
    Cumulative net income . . . . . . . . . . . . . . . . . . . . . .        37,097,572     35,750,061 
    Cumulative cash distributions . . . . . . . . . . . . . . . . . .       (35,839,796)   (34,492,285)
                                                                           ------------   ------------ 
                                                                              1,277,776      1,277,776 
                                                                           ------------   ------------ 
  Limited Partners:
    Capital contributions, net of offering costs. . . . . . . . . . .       364,841,815    364,841,815 
    Cumulative net income . . . . . . . . . . . . . . . . . . . . . .        39,734,696     36,071,642 
    Cumulative cash distributions . . . . . . . . . . . . . . . . . .      (176,794,866)  (152,539,408)
                                                                           ------------   ------------ 
                                                                            227,781,645    248,374,049 
                                                                           ------------   ------------ 
          Total partners' capital accounts. . . . . . . . . . . . . .       229,059,421    249,651,825 
                                                                           ------------   ------------ 

          Total liabilities and partners' capital . . . . . . . . . .      $314,032,027    340,640,143 
                                                                           ============   ============ 

<FN>
                                The accompanying notes are an integral part
                                of these consolidated financial statements.
</TABLE>


<PAGE>


<TABLE>
                                         ARVIDA/JMB PARTNERS, L.P.
                                   CONSOLIDATED STATEMENTS OF OPERATIONS

                             THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996

                                                (UNAUDITED)


<CAPTION>
                                                     THREE MONTHS ENDED           SIX MONTHS ENDED      
                                                          JUNE 30                      JUNE 30          
                                                            ------------------------------------------------------- 
                                                      1997          1996          1997          1996    
                                                 ------------   -----------  ------------   ----------- 
<S>                                             <C>            <C>          <C>            <C>          
Revenues:
  Housing . . . . . . . . . . . . . . . . . . .   $45,120,200    50,035,101    77,890,164   100,095,179 
  Homesites . . . . . . . . . . . . . . . . . .     6,556,525     5,309,248     8,731,704     8,421,248 
  Land and property . . . . . . . . . . . . . .     2,821,789     1,639,540     3,280,349    14,760,201 
  Operating properties. . . . . . . . . . . . .     7,579,225     7,257,263    16,780,263    15,574,281 
  Brokerage and other operations. . . . . . . .     6,228,479     7,797,157    11,689,258    13,789,872 
                                                  -----------    ----------   -----------   ----------- 
        Total revenues. . . . . . . . . . . . .    68,306,218    72,038,309   118,371,738   152,640,781 
                                                  -----------    ----------   -----------   ----------- 
Cost of revenues:
  Housing . . . . . . . . . . . . . . . . . . .    38,805,717    41,643,771    67,382,639    84,548,911 
  Homesites . . . . . . . . . . . . . . . . . .     3,937,468     3,703,417     5,214,387     5,944,055 
  Land and property . . . . . . . . . . . . . .     2,284,766     1,356,631     2,527,779    11,926,747 
  Operating properties. . . . . . . . . . . . .     6,539,114     7,140,931    13,939,744    14,348,278 
  Brokerage and other operations. . . . . . . .     5,844,534     7,014,093    11,176,450    12,835,606 
                                                  -----------    ----------   -----------   ----------- 
        Total cost of revenues. . . . . . . . .    57,411,599    60,858,843   100,240,999   129,603,597 
                                                  -----------    ----------   -----------   ----------- 
Gross operating profit. . . . . . . . . . . . .    10,894,619    11,179,466    18,130,739    23,037,184 
Selling, general and administrative expenses. .    (5,098,646)   (4,560,389)  (12,199,315)   (9,786,622)
                                                  -----------    ----------   -----------   ----------- 
        Net operating income. . . . . . . . . .     5,795,973     6,619,077     5,931,424    13,250,562 

Interest income . . . . . . . . . . . . . . . .       203,469       369,365     1,031,386       781,893 
Equity in earnings (losses) of 
  unconsolidated ventures . . . . . . . . . . .       (27,336)      (83,100)       19,805      (116,913)
Interest and real estate taxes, net . . . . . .    (1,039,483)     (933,651)   (1,972,050)   (1,882,825)
                                                  -----------    ----------   -----------   ----------- 


<PAGE>


                                         ARVIDA/JMB PARTNERS, L.P.

                             CONSOLIDATED STATEMENTS OF OPERATIONS - CONTINUED



                                                     THREE MONTHS ENDED           SIX MONTHS ENDED      
                                                          JUNE 30                      JUNE 30          
                                                            ------------------------------------------------------- 
                                                      1997          1996          1997          1996    
                                                 ------------   -----------  ------------   ----------- 

        Net income. . . . . . . . . . . . . . .   $ 4,932,623     5,971,691     5,010,565    12,032,717 
                                                  ===========    ==========    ==========    ========== 

        Net income per Limited 
          Partnership Interest. . . . . . . . .   $     12.21         14.63          9.07         28.31 
                                                  ===========    ==========    ==========    ========== 

        Cash distributions per 
          Limited Partnership 
          Interest. . . . . . . . . . . . . . .   $     60.04         --            60.04         25.85 
                                                  ===========    ==========    ==========    ========== 

























<FN>
          The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>


<PAGE>


<TABLE>
                                         ARVIDA/JMB PARTNERS, L.P.
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES

                                   CONSOLIDATED STATEMENTS OF CASH FLOWS

                                  SIX MONTHS ENDED JUNE 30, 1997 AND 1996

                                                (UNAUDITED)

<CAPTION>
                                                                                1997            1996    
                                                                            ------------    ----------- 
<S>                                                                        <C>             <C>          
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $  5,010,565     12,032,717 
Charges (credits) to net income not requiring (providing) cash:
  Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . .    1,991,957      2,845,245 
  Equity in (earnings) losses of unconsolidated ventures. . . . . . . . . .      (19,804)       116,913 
  Provision for doubtful accounts . . . . . . . . . . . . . . . . . . . . .       40,983        (10,287)
  Gain on disposition of property and equipment . . . . . . . . . . . . . .        --            (4,491)
Changes in:
  Restricted cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1,106,643)    (1,210,692)
  Trade and other accounts receivable . . . . . . . . . . . . . . . . . . .   (3,955,590)     5,558,929 
  Real estate inventories:
    Additions to real estate inventories. . . . . . . . . . . . . . . . . .  (75,225,917)   (96,341,150)
    Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   70,766,098     97,952,677 
    Capitalized interest. . . . . . . . . . . . . . . . . . . . . . . . . .   (1,315,767)    (2,835,956)
    Capitalized real estate taxes . . . . . . . . . . . . . . . . . . . . .   (1,878,655)    (1,885,382)
  Equity memberships. . . . . . . . . . . . . . . . . . . . . . . . . . . .      472,962        990,615 
  Amounts due from affiliates . . . . . . . . . . . . . . . . . . . . . . .     (178,396)       871,647 
  Prepaid expenses and other assets . . . . . . . . . . . . . . . . . . . .     (870,568)       194,800 
  Accounts payable, accrued expenses and other liabilities. . . . . . . . .   (3,630,992)       117,718 
  Deposits and unearned income. . . . . . . . . . . . . . . . . . . . . . .    4,806,572     (1,434,349)
                                                                            ------------    ----------- 

          Net cash provided by (used in) operating activities . . . . . . .   (5,093,195)    16,958,954 
                                                                            ------------    ----------- 


<PAGE>


                                         ARVIDA/JMB PARTNERS, L.P.
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES

                             CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)



                                                                                1997            1996    
                                                                            ------------    ----------- 
Cash flows from investing activities:
  Mortgages receivable. . . . . . . . . . . . . . . . . . . . . . . . . . .      512,280        694,934 
  Acquisitions of property and equipment. . . . . . . . . . . . . . . . . .   (1,857,832)    (8,747,952)
  Proceeds from sales and disposals of property and equipment . . . . . . .        --            20,763 
  Joint venture distributions (contributions), net. . . . . . . . . . . . .     (500,857)        (7,276)
  Payments from (advances to) joint ventures. . . . . . . . . . . . . . . .        --         4,168,156 
  Proceeds from sale of joint venture interest. . . . . . . . . . . . . . .        --         6,111,440 
                                                                            ------------    ----------- 
          Net cash provided by (used in) investing activities . . . . . . .   (1,846,409)     2,240,065 
                                                                            ------------    ----------- 
Cash flows from financing activities:
  Proceeds from notes and mortgages payable . . . . . . . . . . . . . . . .    1,200,880     27,871,363 
  Payments of notes and mortgages payable . . . . . . . . . . . . . . . . .   (7,866,744)   (40,128,561)
  Distributions to General Partner and Associate Limited Partners . . . . .   (1,347,510)      (579,239)
  Distributions to Limited Partners . . . . . . . . . . . . . . . . . . . .  (24,255,458)   (10,444,416)
  Bank overdrafts . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        --        (3,716,434)
                                                                            ------------    ----------- 
          Net cash used in financing activities . . . . . . . . . . . . . .  (32,268,832)   (26,997,287)
                                                                            ------------    ----------- 
Decrease in Cash and cash equivalents . . . . . . . . . . . . . . . . . . .  (39,208,436)    (7,798,268)

Cash and cash equivalents, beginning of year. . . . . . . . . . . . . . . .   53,635,737     20,171,289 
                                                                            ------------    ----------- 
Cash and cash equivalents, end of period. . . . . . . . . . . . . . . . . . $ 14,427,301     12,373,021 
                                                                            ============    =========== 
Supplemental disclosure of cash flow information:
  Cash paid for mortgage and other interest, net of amounts capitalized . . $      --            33,939 
                                                                            ============    =========== 
  Non-cash investing and financing activities . . . . . . . . . . . . . . . $      --             --    
                                                                            ============    =========== 








<FN>
          The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>


<PAGE>


                       ARVIDA/JMB PARTNERS, L.P.
                        (A LIMITED PARTNERSHIP)
                       AND CONSOLIDATED VENTURES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

                        JUNE 30, 1997 AND 1996

                              (UNAUDITED)

     Readers of this quarterly report should refer to the Partnership's
audited financial statements for the fiscal year ended December 31, 1996,
which are included in the Partnership's 1996 Annual Report on Form 10-K
(File No. 0-16976) filed on March 31, 1997, as certain footnote disclosures
which would substantially duplicate those contained in such audited
financial statements have been omitted from this report.  Capitalized terms
used but not defined in this quarterly report have the same meanings as in
the Partnership's 1996 Annual Report.

GENERAL

     Capitalized Interest and Real Estate Taxes

     Interest, including the amortization of loan fees, of $1,315,767 and
$2,835,956 was incurred for the six months ended June 30, 1997 and 1996,
respectively, all of which was capitalized.  Interest payments, including
amounts capitalized, of $1,275,291 and $2,869,895 were made during the six
months ended June 30, 1997 and 1996, respectively.  Interest, including the
amortization of loan fees, of $681,238 and $1,357,841 was incurred for the
three months ended June 30, 1997 and 1996, respectively, all of which was
capitalized.  Interest payments, including amounts capitalized of $714,665
and $1,278,892, were made during the three months ended June 30, 1997 and
1996, respectively.

     Real estate taxes of $3,850,705 and $3,768,207 were incurred for the
six months ended June 30, 1997 and 1996, respectively, of which $1,878,655
and $1,885,382 were capitalized, respectively.  Real estate tax payments of
$322,313 and $377,347 were made during the six months ended June 30, 1997
and 1996, respectively.  Real estate taxes of $1,892,581 and $1,891,107
were incurred for the three months ended June 30, 1997 and 1996,
respectively, of which $853,098 and $957,456 were capitalized,
respectively.  Real estate tax payments of $209,670 and $175,176 were made
during the three months ended June 30, 1997 and 1996, respectively.  In
addition, real estate tax reimbursements totaling $244,706 and $165,682
were received from the Partnership's escrow agent during the six months
ended June 30, 1997 and 1996, respectively.  The preceding analysis of real
estate taxes does not include real estate taxes incurred or paid with
respect to the Partnership's club facilities and other operating properties
as these taxes are included in cost of revenues for operating properties.

     Property and Equipment and Other Assets

     Depreciation expense of $1,841,345 and $2,668,474 was incurred for the
six months ended June 30, 1997 and 1996, respectively.  Amortization of
other assets, excluding loan fees, of $42,754 and $49,297 was incurred for
the six months ended June 30, 1997 and 1996, respectively.  Amortization of
loan fees, which is included in interest expense, of $108,058 and $127,414
was incurred for the six months ended June 30, 1997 and 1996, respectively.

Depreciation expense of $768,517 and $1,341,734 was incurred for the three
months ended June 30, 1997 and 1996, respectively.  Amortization of other
assets, excluding loan fees, of $22,555 and $27,036 was incurred for the
three months ended June 30, 1997 and 1996, respectively.  Amortization of
loan fees, which is included in interest expense, of $71,478 and $64,579
was incurred for the three months ended June 30, 1997 and 1996,
respectively.


<PAGE>


     The decrease in depreciation expense for the three and six months
ended June 30, 1997 as compared to the three and six months ended June 30,
1996 is due to the elimination of depreciation expense for assets held for
disposal in accordance with FASB Statement 121.  The Partnership's
application of this statement is discussed further in the "Impact of
Recently Issued Accounting Standards" section of the Notes.

     Partnership Records

     During February 1997, the Partnership made a distribution for 1996 of
$24,240,000 to its Holders of Interests ($60.00 per Interest) and
$1,346,651 to the General Partner and Associate Limited Partners,
collectively.  In addition, during 1997 distributions totaling $15,458
(approximately $.04 per Interest) were deemed to be paid to each Holder of
Interests, $15,372 of which was remitted to North Carolina tax authorities
on their behalf for the 1996 non-resident withholding tax.  Distributions
totaling $859 were also paid during 1997 on behalf of the General Partner
and Associate Limited Partners, collectively, a portion of which was also
remitted to the North Carolina tax authorities on their behalf.  These
distributions are the primary cause for the decrease in Cash and cash
equivalents at June 30, 1997 as compared to December 31, 1996.

     Reclassifications

     Certain reclassifications have been made to the 1996 financial
statements to conform to the 1997 presentation.

NOTES AND MORTGAGES PAYABLE

     At June 30, 1997, the Partnership's credit facility consisted of a
term loan in the original amount of $85,252,520, a revolving line of credit
facility up to $20 million, an income property term loan in the original
amount of $18,233,326 and a $15 million letter of credit facility, all of
which had a maturity of July 1997.  For the six month period ended June 30,
1997, the effective interest rate for the combined term loan, income
property term loan and revolving line of credit facility was approximately
8.3% per annum.

     Under the term loan agreement, the Partnership made scheduled
principal payments of $10 million in March 1994, February 1995 and February
1996 and $5 million principal payments in July 1995 and July 1996.  The
term loan agreement also provided for additional principal repayments based
upon a specified percentage of available cash flow and upon the sale of
certain assets.  During the year ended December 31, 1996, the Partnership
made such additional term loan payments totaling approximately $12.3
million.  In January 1997, the Partnership paid off the remaining principal
balance of $5,234,008 outstanding under the term loan.  Under the income
property term loan, principal payments of $0.1 million were required to be
paid monthly until maturity.  The terms of the Partnership's credit
facility required that upon satisfaction of the principal due under the
term loan, the additional term loan principal repayments described above
would be applied to the principal outstanding under the income property
term loan.  Accordingly, the Partnership made such additional income
property term loan repayments totaling approximately $1.3 million during
the six months ended June 30, 1997.  At June 30, 1997, the balances
outstanding on the revolving line of credit facility, the income property
term loan and the letter of credit facility were $0, $9,712,126 and
$4,871,125, respectively.



<PAGE>


     On July 31, 1997, the Partnership obtained a new credit facility from
Barnett Bank, N.A. ("Barnett") and certain other banks.  The new credit
facility consists of a $75 million term loan, a $20 million revolving line
of credit and a $5 million letter of credit facility.  The new facility has
a term of four years with annual scheduled principal repayments of $12.5
million, as well as additional annual principal repayments based upon a
specified percentage or amount of the Partnership's available cash.  The
maximum required principal repayments, including the scheduled repayments,
generally will not exceed $18.75 million per annum.  The remaining
outstanding balance on the new facility is due upon maturity.  Interest on
the facility is based, at the Partnership's option, on the relevant LIBOR
plus 2.25% per annum or Barnett's prime rate.  The Partnership expects to
obtain an interest rate swap for all or a portion of the outstanding
balance of the term loan.  The Partnership paid loan fees totaling
approximately 1% of the total facility upon the closing of the loan.  In
conjunction with the closing of the loan, the Partnership paid off the
remaining balances outstanding under its existing credit facility including
principal, interest and fees totaling approximately $9.6 million.  In
addition, due to the replacement of the Partnership's existing letter of
credit facility by the new credit facility, the Partnership was required to
post approximately $4.2 million cash as collateral with its previous lender
for letters of credit which continue to be obligations of that lender.  The
letters of credit are expected to be replaced with letters of credit issued
under the Barnett facility at which time the cash collateral will be
released to the Partnership.  The term loan, revolving line of credit and
letter of credit facility are secured by recorded mortgages on real
property of the Partnership (including certain of its consolidated
ventures) and pledges of certain other assets.  All of the loans under this
new facility are cross-collateralized and cross-defaulted.  Proceeds from
the new financing were used to make a distribution in the amount of
approximately $73.4 million, including a distribution of $175 per Interest
to the Holders of Interests in August 1997, as discussed in the Subsequent
Events section of the Notes.

     During April 1996, the Partnership refinanced the loan on one of its
retail properties located in its Weston Community with a different lender.
The outstanding principal balance on such loan of approximately $8.0
million is included in Notes and mortgages payable at June 30, 1997.  In
addition, $3.0 million of subordinated debt attributable to the Cullasaja
Joint Venture is included in Notes and mortgages payable at June 30, 1997.

     During January 1996, the Partnership executed a note for a $7.5
million construction loan for the construction and development of a second
retail shopping center located in its Weston Community.  At June 30, 1997,
the entire $7.5 million was outstanding under this loan.  The Partnership,
at its option, extended the loan upon its maturity, at which time it was
converted to a mini-permanent loan.  The loan bears the same rate of
interest as the original construction loan (lender's prime rate (8.5% at
June 30, 1997) plus 1/2% per annum), and matures in July 2000.  Principal
and interest on the loan are payable monthly, based on a 25-year
amortization schedule.

INVESTMENTS IN AND ADVANCES TO JOINT VENTURES

     During March 1996, the Partnership closed on the sale of its 20% joint
venture interest in Coto de Caza, including the related promissory note for
advances previously made to the joint venture, to unaffiliated third
parties for a cash sales price of $12 million.  This transaction is
reflected in Land and property revenues for the six months ended June 30,
1996 on the accompanying consolidated statements of operations and is the
primary cause for the decrease in Land and property revenues and cost of
revenues for the six months ended June 30, 1997 as compared to the same
period in 1996.

     On December 31, 1996, the Partnership purchased its joint venture
partner's 50% interest in the Arvida Boose Joint Venture for a purchase
price of approximately $1.8 million and formed a new joint venture in the
name of Metrodrama Joint Venture.  As a result of this transaction, the


<PAGE>


Partnership changed from the equity method of accounting to the
consolidated method of accounting for the joint venture effective December
31, 1996.


TRANSACTIONS WITH AFFILIATES

     The Partnership, subject to certain limitations, may engage affiliates
of the General Partner for property management, insurance and certain other
administrative services to be performed in connection with the
administration of the Partnership and its assets.  The total of such costs
for the six months ended June 30, 1997 was approximately $72,700, all of
which was paid as of June 30, 1997.  The total of such costs for the six
months ended June 30, 1996 was approximately $94,100.  In addition, the
General Partner and its affiliates are entitled to reimbursements for
salaries and salary-related costs relating to the administration of the
Partnership and the operation of the Partnership's properties.  Such costs
were approximately $198,900 and $50,600 for the six months ended June 30,
1997 and 1996, respectively, all of which were paid as of June 30, 1997.

     The Partnership receives reimbursements from or reimburses other
affiliates of the General Partner engaged in real estate activities for
certain general and administrative costs including, and without limitation,
salary and salary-related costs relating to work performed by employees of
the Partnership and certain out-of-pocket expenditures incurred on behalf
of such affiliates.  For the six month period ended June 30, 1997, the
amount of such costs incurred by the Partnership on behalf of these
affiliates totaled approximately $251,800.  At June 30, 1997, approximately
$153,700 was owed to the Partnership, of which approximately $150,400 was
received as of August 8, 1997.  For the six month period ended June 30,
1996, the Partnership was entitled to reimbursements of approximately
$110,200.

     Prior to June 1996, the Partnership and Arvida/JMB Partners, L.P.-II
(a publicly-held limited partnership affiliated with the General Partner)
each employed project related and administrative personnel who performed
services on behalf of both partnerships.  In addition, certain out-of-
pocket expenditures related to such services and other general and
administrative costs were incurred and charged to each partnership as
appropriate.  The Partnership receives reimbursements from Arvida/JMB
Partners, L.P.-II for these costs (including salary and salary-related
costs).  Subsequent to June 1996, Arvida/JMB Partners, L.P.-II no longer
employed any project-related or administrative personnel and incurred no
costs on behalf of the Partnership.  For the six month periods ended June
30, 1997 and 1996, the Partnership was entitled to receive approximately
$56,000 and $1,178,000, respectively, from Arvida/JMB Partners, L.P.-II. 
At June 30, 1997, approximately $20,500 was owed to the Partnership, all of
which was received as of August 8, 1997.  In addition, for the six month
periods ended June 30, 1997 and 1996, the Partnership was obligated to
reimburse Arvida/JMB Partners, L.P.-II approximately $0 and $113,700,
respectively.  At June 30, 1997, approximately $1,800 was unpaid, including
amounts owed from the prior year, all of which was outstanding as of August
8, 1997.

     Arvida Company ("Arvida"), pursuant to an agreement with the
Partnership, provides development, construction, management and other
personnel and services to the Partnership for all of its projects and
operations.  Pursuant to such agreement, the Partnership reimburses Arvida
for all of its salary and salary-related costs incurred in connection with
work performed on behalf of the Partnership, subject to certain
limitations.  The total of such costs for the six month periods ended June
30, 1997 and 1996 were approximately $4,297,200 and $4,384,700,
respectively.  In addition, the Partnership was obligated to reimburse
Arvida approximately $22,000 at June 30, 1997, all of which was paid as of
August 8, 1997.


<PAGE>


     The Partnership pays for certain general and administrative costs on
behalf of its equity clubs, homeowners associations and maintenance
associations (including salary and salary-related costs).  The Partnership
receives reimbursements from these entities for such costs.  For the six
month periods ended June 30, 1997 and 1996, the Partnership was entitled to
receive approximately $3,107,700 and $2,453,400, respectively, from these
entities.  At June 30, 1997, approximately $41,200 was owed to the
Partnership, of which approximately $29,100 was received as of August 8,
1997.  In addition, the Partnership owes its equity clubs for certain costs
incurred by the clubs which are obligations of the Partnership.  For the
six month periods ended June 30, 1997 and 1996, the Partnership was
obligated to reimburse its equity clubs approximately $24,200 and $9,200,
respectively.  At June 30, 1997, approximately $12,400 was unpaid, of which
approximately $4,300 was paid as of August 8, 1997.

     The Partnership, pursuant to an agreement, provides management and
other personnel and services to one of its equity clubs.  Pursuant to this
agreement, the Partnership is entitled to receive a management fee for the
services provided to the club.  For the six months ended June 30, 1997 and
1996, the Partnership was entitled to receive approximately $258,500 and
$252,500.  At June 30, 1997, approximately $358,600 was unpaid (including
amounts owed from the previous year), of which approximately $50,000 was
received as of August 8, 1997.

     The Partnership funds certain capital expenditures, working capital
advances and operating deficits of its equity clubs, as well as operating
deficits of its homeowners associations as required or deemed necessary. 
The working capital advances and certain capital expenditure fundings are
non-interest bearing, short term in nature, and are expected to be
reimbursed from future cash flows of the equity clubs.  The funding of
operating deficits is expensed by the Partnership.  At June 30, 1997, the
Partnership was owed approximately $647,800 from its equity clubs, none of
which was received as of August 8, 1997.

     The Partnership periodically incurs salary and salary-related costs on
behalf of an affiliate of the General Partner of the Partnership.  The
Partnership was entitled to receive approximately $239,700 and $0 for such
costs for the six months ended June 30, 1997 and 1996, respectively, of
which approximately $37,300 was owed to the Partnership at June 30, 1997,
none of which was received as of August 8, 1997.

     In accordance with the Partnership Agreement, the General Partner and
Associate Limited Partners have deferred a portion of their distributions
of net cash flow from the Partnership totaling approximately $2,943,700 as
of June 30, 1997.  This amount does not bear interest and is expected to be
paid in future periods subject to certain restrictions contained in the
partnership agreement of the Partnership.

     All amounts receivable from or payable to the General Partner or its
affiliates do not bear interest and are expected to be paid in future
periods.

COMMITMENTS AND CONTINGENCIES

     As security for performance of certain development obligations, the
Partnership is contingently liable under standby letters of credit and
performance bonds for approximately $4,871,000 and $7,993,000, respec-
tively, at June 30, 1997.  In addition, certain joint ventures in which the
Partnership holds an interest are also contingently liable under
performance bonds for approximately $1,020,000 at June 30, 1997.



<PAGE>


     The Partnership was a defendant in a lawsuit filed in the County
Department, Chancery Division of the Circuit Court of Cook County, Illinois
on July 1, 1996, and entitled Jack H. Carlstrom, Lynn M. Carlstrom, Woneta
Bellevue, Roger Lathbury and Begona Lathbury v. Arvida/JMB Managers, Inc.,
Neil G. Bluhm, Ira J. Schulman, Burton E. Glazov, Stuart C. Nathan, A. Lee
Sacks, John G. Schreiber, Judd D. Malkin, Lehman Brothers Inc., Starwood
Capital Group I, L.P., Starwood/Florida Funding, L.L.C., Starwood
Opportunity Fund IV, L.P., BSS Capital II, L.L.C., Barry Sternlicht, Walton
Street Capital Acquisition Co. III and Whitehall Street Real Estate Limited
Partnership VII, and Arvida/JMB Partners, L.P., nominal defendant
("Carlstrom action").  The Carlstrom action challenged, among other things,
the Partnership's proposed $160 million term loan from Starwood/Florida
Funding L.L.C. ("Starwood financing").  The complaint, as amended, alleged,
among other things, that the General Partner breached its fiduciary duties
owed plaintiffs and members of the purported class plaintiffs sought to
represent by failing to negotiate for the financing with other entities and
entering into the Starwood financing in order to entrench itself and
maintain its control over the Partnership.  The complaint, as amended, also
alleged that the terms of the Starwood Financing were burdensome to the
Partnership and allegedly would cause a waste of the Partnership's assets. 
The Carlstrom action was consolidated with an earlier filed action and was
brought as a four-count complaint for breach of fiduciary duty on behalf of
the class, breach of fiduciary duty on behalf of the Partnership,
conspiracy and collusion to breach fiduciary duties on behalf of the class
and the Partnership, and for an injunction on behalf of the class and the
Partnership.  In addition to the relief described above, plaintiffs in the
complaint, as amended, on behalf of themselves and members of the purported
class, sought damages in a sum to be determined at trial, attorneys' fees
and costs, and such other relief as the Court might deem just and proper. 
On December 13, 1996, the Court granted the plaintiffs' motion for a
preliminary injunction to stop the Starwood financing until a hearing on a
permanent injunction.  The Partnership, its General Partner, and members of
the Special Committee appealed.  After the Partnership appealed, the
parties entered into a settlement.  After notice to the class, and a
hearing on May 13, 1997, the trial court, among other things, approved the
settlement as fair, reasonable and adequate, and in the best interests of
the plaintiffs, Holders of Interests, and the Partnership; ordered that the
settlement be consummated by the parties in accordance with its terms and
conditions and the terms and conditions of the stipulation of settlement on
file with the court; dismissed the action on the merits and with prejudice;
reserved jurisdiction over all matters relating to the consummation and
enforcement of the stipulation of settlement and the settlement, and
without limiting the generality of the foregoing, to the enforcement on any
replacement general partner of the commitment of the General Partner in
October 1997 to choose the option set forth in Section 5.5(j)(i)(c) of the
Partnership Agreement; and permanently enjoined and barred the Partnership,
plaintiffs, and Holders of Interests from instituting, commencing,
asserting, prosecuting, or continuing any of the released claims against
any of the defendants in any jurisdiction.  The Partnership paid
approximately $1.8 million for the plaintiffs attorneys' fees and expenses
during June 1997 as a result of the approved settlement.  No appeal from
the settlement has been taken.

     On or about September 27, 1996, a lawsuit entitled Vanderbilt Income
and Growth Associates, L.L.C. and Raleigh Capital Associates L.P.,
individually and derivatively on behalf of Arvida/JMB Partners, L.P. v.
Arvida/JMB Managers, Inc., Judd D. Malkin, Neil G. Bluhm, Burton E. Glazov,
Stuart C. Nathan, A. Lee Sacks, John G. Schreiber, BSS Capital II, L.L.C.,
Starwood Capital Group I, L.P., Starwood/Florida Funding, L.L.C., Starwood
Opportunity Fund, IV, L.P. and Barry Sternlicht, Defendants, and Arvida/JMB
Partners, L.P., nominal defendant, was filed in the Court of Chancery of
the State of Delaware in and for New Castle County, Civil Action No. 15238
("Raleigh action").  The Raleigh action was filed as a verified complaint
for declaratory and injunctive relief.  Plaintiffs claimed that the
defendants in entering into the financing commitment letter for the
Starwood term financing violated, or aided and abetted, or participated in
the violation of, fiduciary duties owed to the Partnership and the Holders


<PAGE>


of Interests, and put their personal interests ahead of the interests of
the Partnership and the Holders of Interests.  In the first claim for
relief, plaintiffs sought a declaratory judgment that the terms of the
financing be declared null, void and unenforceable.  In the second claim
for relief, plaintiffs asserted a claim derivatively on behalf of the
Partnership alleging, among other things, that the financing commitment
letter was not the product of a valid exercise of business judgment.  In
addition to relief described above, plaintiffs sought to preliminarily and
permanently enjoin any actions in furtherance of the financing commitment
letter, an award of compensatory damages, interest, costs and
disbursements, including reasonable attorneys' and experts' fees and such
other relief as the Court might deem just and proper.  The General Partner
and the Partnership filed a motion to dismiss the Raleigh action which was
granted on November 7, 1996.  In granting the motion, the Court held that
Raleigh was not a Limited Partner and did not have standing to file the
derivative claims.  The Court further determined that Raleigh did not have
the right to vote.  Plaintiffs asked the Court to reconsider its ruling,
but the Court denied the request to change its ruling.

     Plaintiffs appealed the November 7, 1996 dismissal order.  On December
12, 1996, the Delaware Supreme Court reversed the trial court order on a
procedural ground.  The Delaware Supreme Court concluded that the trial
court should not have considered matters outside of the pleadings in
dismissing the Raleigh action without providing the plaintiffs some limited
discovery.  Accordingly, the Delaware Supreme Court remanded the case back
to the trial court for further proceedings.

     On December 16, 1996, the Partnership filed a counterclaim against
Vanderbilt Income and Growth Associates, L.L.C. and Raleigh Capital
Associates L.P. ("Raleigh"), seeking a declaratory judgment that Raleigh
had no right to vote on Partnership matters.  On January 28, 1997, the
trial court granted plaintiffs leave to dismiss their own complaint
concerning the Starwood financing, leaving the Partnership's counterclaim
pending.

     By letter dated January 10, 1997, Raleigh requested admission as a
Substituted Limited Partner of the Partnership.  The Partnership referred
the request to the Special Committee.  On February 11, 1997, the Special
Committee denied the request.  Thereafter, the Partnership supplemented its
counterclaim, as amended, and sought a court declaration that Raleigh is
not entitled to be admitted as a Substituted Limited Partner.  On February
20, 1997, Raleigh filed a reply and counterclaim against the Partnership,
the General Partner, and the Special Committee.  The reply counterclaim
sought, among other things, a declaration that Raleigh has voting rights in
the Partnership and that defendants' breached their fiduciary duties by
failing to admit Raleigh as a Substituted Limited Partner.  The reply
counterclaim also sought to enjoin the Partnership, the General Partner,
and the Special Committee from refusing to admit Raleigh as a Substituted
Limited Partner, an award of damages, interest, fees, and costs.

     On or about February 28, 1997, Gladys Beasley, individually and as a
representative of a class of persons similarly situated, filed an
intervenor complaint for declaratory relief against the Partnership.  In
the intervenor complaint, plaintiff sought a declaration that purchasers
who obtained Interests in the Partnership in the public offering and
subsequent Holders of Interests in the Partnership by assignment from
original Holders have the same voting rights in the Partnership, among
other things, to remove and replace the General Partner.  In addition,
plaintiff Gladys Beasley, sought an order adjudging and decreeing that the
intervenor action was properly maintained as a class, an award of her costs
and expenses of the litigation, and such other relief as the Court deemed
appropriate.

     The trial of all claims in the Raleigh action was held on April 7
through April 9, 1997.  In a memorandum opinion dated May 23, 1997, the
Court concluded that, while neither the partnership agreement nor the
assignment agreement of the Partnership expressly states whether subsequent


<PAGE>


Holders of Interests have voting rights, a reasonable investor could have
read the operative agreements as providing that subsequent Holders of
Interests, such as Raleigh, have voting rights.  The Partnership believes,
among other things, that the Court erred in its application of the law to
the facts on this issue and is in the process of appealing the Court's
decision on this aspect of the case.  On the issue of whether Arvida/JMB
Managers, Inc. properly denied Raleigh's request for admission as a
Substituted Limited Partner, the Court upheld the denial of Raleigh's
request.

     The Partnership was named a defendant in a number of homeowner
lawsuits, certain of which purported to be class actions, that allegedly in
part arose out of or related to Hurricane Andrew, which on August 24, 1992
resulted in damage to a former community development known as Country Walk.

The homeowner lawsuits alleged, among other things, that the damage
suffered by the plaintiffs' homes and/or condominiums within Country Walk
was beyond what could have been reasonably expected from the hurricane
and/or was a result of the defendants' alleged defective design,
construction, inspection and/or other improper conduct in connection with
the development, construction and sales of such homes and condominiums,
including alleged building code violations.  The various plaintiffs sought
varying and, in some cases, unspecified amounts of compensatory damages and
other relief.  In certain of the lawsuits injunctive relief and/or punitive
damages were sought.

     Several of these lawsuits alleged that the Partnership was liable,
among other reasons, as a result of its own alleged acts of misconduct or
as a result of the Partnership's alleged assumption of Arvida Corporation's
liabilities in connection with the Partnership's purchase of Arvida
Corporation's assets from Disney in 1987, which included certain assets
related to the Country Walk development.  Pursuant to the agreement to
purchase such assets, the Partnership obtained indemnification by Disney
for certain liabilities relating to facts or circumstances arising or
occurring prior to the closing of the Partnership's purchase of the assets.

Over 80% of the Arvida-built homes in Country Walk were built prior to the
Partnership's ownership of the Community.  Where appropriate, the
Partnership has tendered or will tender each of the above-described
lawsuits to Disney for defense and indemnification in whole or in part
pursuant to the Partnership's indemnification rights.  Where appropriate,
the Partnership has also tendered these lawsuits to its various insurance
carriers for defense and coverage.  The Partnership is unable to determine
at this time to what extent damages in these lawsuits, if any, against the
Partnership, as well as the Partnership's cost of investigating and
defending the lawsuits, will ultimately be recoverable by the Partnership
either pursuant to its rights of indemnification by Disney or under
contracts of insurance.

     One of the Partnership's insurance carriers has been funding
settlements of various litigation related to Hurricane Andrew.  In some,
but not all, instances, the insurance carrier has provided the Partnership
with written reservation of rights letters.  The aggregate amount of the
settlements funded to date by this carrier is approximately $8.0 million. 
The insurance carrier that funded these settlements pursuant to certain
reservations of rights has stated its position that it has done so pursuant
to various non-waiver agreements.  The carrier's position was that these
non-waiver agreements permitted the carrier to fund settlements without
barring the carrier from raising insurance coverage issues or waiving such
coverage issues.  On May 23, 1995, the insurance carrier rescinded the
various non-waiver agreements currently in effect regarding the remainder
of the Hurricane Andrew litigation, allegedly without waiving any future
coverage defenses, conditions, limitations, or rights.  For this and other
reasons, the extent to which the insurance carrier may recover any of these
proceeds from the Partnership is uncertain.  Therefore, the accompanying
consolidated financial statements do not reflect any accruals related to
this matter.


<PAGE>


     Currently, the Partnership is involved in two subrogation lawsuits. 
On April 19, 1993, a subrogation claim entitled Village Homes at Country
Walk Master Maintenance Association, Inc. v. Arvida Corporation et al., was
filed in the 11th Judicial Circuit for Dade County.  Plaintiffs filed this
suit for the use and benefit of American Reliance Insurance Company
("American Reliance").  In this suit, as amended, plaintiffs seek to
recover damages and pre- and post-judgment interest in connection with
$10,873,000 American Reliance has allegedly paid, plus amounts it may have
to pay in the future, to the condominium association at Country Walk in the
wake of Hurricane Andrew.  Disney is also a defendant in this suit.  The
Partnership believes that the amount of this claim that allegedly relates
to units it built and sold is approximately $3,600,000.  Plaintiffs also
seek a declaratory judgment seeking to hold the Partnership and other
defendants responsible for amounts American Reliance must pay in the future
to its insured as additional damages beyond the $10,873,000 previously
paid.  The Partnership has filed motions directed to the complaint, as
amended, and the litigation is in the discovery stage.  The Partnership
intends to vigorously defend itself.  On or about May 10, 1996, a
subrogation claim entitled Juarez et al. v. Arvida Corporation et al. was
filed in the Circuit Court of the Eleventh Judicial Circuit in and for Dade
County.  Plaintiffs filed this suit for the use and benefit of American
Reliance.  In this suit, plaintiffs seek to recover damages, pre-and post-
judgment interest, costs and any other relief the Court may deem just and
proper in connection with $3,200,000 American Reliance allegedly paid on
specified claims at Country Walk in the wake of Hurricane Andrew.  Disney
is also a defendant in this suit.  The Partnership is advised that the
amount of this claim that allegedly relates to units it sold is
approximately $350,000.  The Partnership intends to defend itself
vigorously in this matter.  The Partnership was also involved in a 
subrogation action brought by the Insurance Company of North America
("INA") arising out of a claim that INA allegedly paid on a single home in
Country Walk.  The Partnership has settled this claim for approximately
$5,600 with the settlement being funded by the Partnership's insurance
carrier.  On April 24, 1997, the Metropolitan Property and Casualty Company
("Metropolitan") filed a lawsuit entitled Metropolitan Property and
Casualty Company v. Arvida/JMB Partners in the Circuit Court of the 11th
Judicial Circuit in and for Dade County for subrogation in which it seeks
compensatory damages, costs, interest and any other relief the court may
claim just in connection with money Metropolitan allegedly paid to its
homeowner insureds in the wake of Hurricane Andrew.  Metropolitan has
advised the Partnership that in connection with this suit there are three
claims, totaling approximately $505,000.  The Partnership could be named in
other subrogation actions, and in such event, the Partnership intends to
vigorously defend itself in such actions.  Due to the uncertainty of the
outcome of these subrogation actions, the accompanying consolidated
financial statements do not reflect any accruals related to these matters.

     The Partnership has been advised by Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch") that various investors have sought to
compel Merrill Lynch to arbitrate claims brought by certain investors of
the Partnership representing approximately 5% of the total of approximately
404,000 Interests outstanding.  Merrill Lynch has asked the Partnership and
its General Partner to confirm an obligation of the Partnership and its
General Partner to indemnify Merrill Lynch in these claims against all
loss, liability, claim, damage and expense, including without limitation
attorneys' fees and expenses, under the terms of a certain Agency Agreement
dated September 15, 1987 ("Agency Agreement") with the Partnership relating
to the sale of Interests through Merrill Lynch on behalf of the
Partnership.  These claimants have sought and are seeking to arbitrate
claims involving unspecified damages against Merrill Lynch based on Merrill
Lynch's alleged violation of applicable state and/or federal securities
laws and alleged violations of the rules of the National Association of
Securities Dealers, Inc., together with pendent state law claims.  The
Partnership believes that Merrill Lynch has resolved some of these claims
through litigation and otherwise, and that Merrill Lynch is defending other
claims.  The Agency Agreement generally provides that the Partnership and
its General Partner shall indemnify Merrill Lynch against losses occasioned
by any actual or alleged misstatements or omissions of material facts in
the Partnership's offering materials used in connection with the sale of


<PAGE>


Interests and suffered by Merrill Lynch in performing its duties under the
Agency Agreement, under certain specified conditions.  The Agency Agreement
also generally provides, under certain conditions, that Merrill Lynch shall
indemnify the Partnership and its General Partner for losses suffered by
the Partnership and occasioned by certain specified conduct by Merrill
Lynch in the course of Merrill Lynch's solicitation of subscriptions for,
and sale of, Interests.  The Partnership is unable to determine the
ultimate investment of investors who have filed arbitration claims as to
which Merrill Lynch might seek indemnification in the future.  At this
time, and based upon the information presently available about the
arbitration statements of claims filed by some of these investors, the
Partnership and its General Partner believe that they have meritorious
defenses to demands for indemnification made by Merrill Lynch and intend to
vigorously pursue such defenses.  Although there can be no assurance
regarding the outcome of the claims for indemnification, at this time,
based on information presently available about such arbitration statements
of claims, the Partnership and its General Partner do not believe that the
demands for indemnification by Merrill Lynch will have a material adverse
effect on the financial condition of the Partnership.

     On or about October 16, 1995, a lawsuit was filed against the
Partnership and others in the Circuit Court of the 15th Judicial Circuit,
in and for Palm Beach County, Florida, and amended on or about February 20,
1996, entitled Council of Villages, Inc. et al v. Arvida/JMB Partners,
Arvida/JMB Managers, Inc., Arvida/JMB Partners, Ltd., Broken Sound Club,
Inc., and Country Club Maintenance Association, Inc.  The multi-count
complaint, as amended, is brought as a class action, and individually, on
behalf of various residents of the Broken Sound Community, and alleges that
defendants engaged in various acts of misconduct in, among other things,
the establishment, operation, management and marketing of the Broken Sound
golf course and recreational facilities, as well as the alleged improper
failure to turn over such facilities to the Broken Sound homeowners on a
timely basis.  Plaintiffs seek, through various theories, including but not
limited to breach of ordinance, breach of fiduciary duty, fraud, unjust
enrichment and civil theft, damages in excess of $45 million, the
appointment of a receiver for the Broken Sound Club, other unspecified
compensatory damages, the right to seek punitive damages, treble damages,
prejudgment interest, attorneys' fees and costs.  The Partnership believes
that the lawsuit is without merit and intends to vigorously defend itself
in this matter.

     On or about July 30, 1996, Savoy v. Arvida/JMB Partners, Arvida/JMB
Managers, Inc., Arvida/JMB Partners, Ltd., and Broken Sound Club, Inc. was
filed against the Partnership and others in the Circuit Court of the 15th
Judicial Circuit, in and for Palm Beach County, Florida.  The lawsuit is
filed as a three-count complaint for dissolution of the Broken Sound Club,
Inc. ("Club"), and seeks, among other things, the appointment of a
custodian or receiver for the Club, a determination that certain acts be
deemed wrongful, the return to the Club of in excess of $2.5 million in
alleged "operating profits", an injunction against the charging of certain
dues, an injunction requiring the Club to produce certain financial
statements, and such other relief as the Court deems just, fair and proper.

The Partnership believes the lawsuit is without merit and intends to
vigorously defend itself.

     The Partnership owns a 50% joint venture interest in 31 commercial/
industrial acres in Pompano Beach, Florida, which is encumbered by a
mortgage loan in the principal amount of approximately $4 million at March
31, 1997.  During April 1992, as a result of the Partnership's previous
determination that the development of the land was no longer economically
profitable, the Partnership and its joint venture partner each tendered
payment in the amount of approximately $3.1 million to the lender for their
respective shares of the guarantee payment required under the loan
agreement and certain other holding costs, the majority of which reduced
the outstanding mortgage loan to its current balance.  The venture also
intended at that time to convey title to the property to the lender;
however, such conveyance is pending until resolution of certain
environmental issues.  The Partnership had been negotiating with the lender


<PAGE>


regarding the scope of the development work required to be done.  
Negotiations with the lender were unsuccessful, and the lender filed a
lawsuit entitled Bankers' Trust Company v. Arvida/JMB Partners, L.P., et
al., Case No. 95-2780 in the Broward County Circuit Court in which the
lender asserted, among other things, that the mortgage loan is with
recourse to the joint venture partners as a result of the partners' failure
to perform in accordance with the terms of the loan agreement.  The lender
demanded payment of the outstanding loan balance plus interest thereon. 
The lawsuit has been resolved.  On or about July 18, 1997, the parties
entered into a settlement agreement which provides for, among other things,
the payment of $300,000 by the Partnership, $300,000 on behalf of the Joint
Venture Partner, the payment of back taxes on the property by the Joint
Venture in the amount of $302,398, a commitment by the Joint Venture to
remediate the property on or before June 30, 2000 in accordance with the
settlement agreement, issuance of a new non-recourse note, a mortgage
modification and dismissal of the lawsuit with prejudice and without costs.

With respect to the environmental issues, the previous owner remains
obligated to undertake the clean-up.  The clean-up began in July 1994, and
the first phase of the remedial action plan was completed in October 1994. 
Further action plans are now being discussed with state environmental
officials.  If the previous owner is unable to fulfill all its obligations
as they relate to this environmental issue, the venture and ultimately the
Partnership may be obligated for such costs.  Should this occur, the
Partnership does not anticipate the cost of this clean-up to be material to
its operations.

     The Partnership is also a defendant in several actions brought against
it arising in the normal course of business.  It is the belief of the
General Partner, based on knowledge of facts and advice of counsel, that
the claims made against the Partnership in such actions will not result in
any material adverse effect on the Partnership's consolidated financial
position or results of operations.

     The Partnership may be responsible for funding certain other ancillary
activities for related entities in the ordinary course of business which
the Partnership does not currently believe will have any material adverse
effect on its consolidated financial position or results of operations.

IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

     The Partnership adopted the Financial Accounting Standard's Board's
Statement No. 121, "Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to Be Disposed Of", effective January 1, 1995.  In
accordance with Statement No. 121, the Partnership has discontinued
recording depreciation on assets held for disposal.  The combined results
of operations for the Partnership's assets held for disposal totaled
approximately $2.8 million and $1.5 million for the six months ended June
30, 1997 and 1996, respectively, and are included in operating properties
revenues and cost of revenues on the accompanying consolidated statements
of operations.  The Partnership requires no impairment losses or other
adjustments to be recorded as of June 30, 1997 as a result of the
application of this statement.

     During the second quarter of 1997, Statements of Financial Accounting
Standards No. 128 ("Earnings per Share") and No. 129 ("Disclosure of
Information about Capital Structure") were issued.  As the Partnership's
capital structure consists of only general and limited partnership
interests, the Partnership does not expect any significant impact on its
consolidated financial statements upon adoption of these standards when
required at the end of 1997.

ADJUSTMENTS

     In the opinion of the General Partner, all adjustments (consisting
solely of normal recurring adjustments) necessary for a fair presentation
have been made to the accompanying consolidated financial statements as of
June 30, 1997 and December 31, 1996 and for the three and six months ended
June 30, 1997 and 1996.


<PAGE>


SUBSEQUENT EVENTS

     During July 1997, the Partnership entered into a contract for the sale
of its mixed-use center in Boca Raton, Florida known as Arvida Parkway
Center to an unaffiliated third party.  Arvida Parkway Center consists of
approximately 258,000 square feet of space in a mix of offices,
restaurants, retail, financial institutions and a Radisson Suite Hotel. 
The sale is scheduled to close during 1997.  However, such closing is
subject to the satisfaction of various conditions, and there can be no
assurance that such conditions will be satisfied.  If the sale is completed
under its proposed terms, it is expected to generate a gain for financial
reporting purposes and Federal income tax purposes.

     During August 1997, the Partnership made a distribution of $70,700,000
to its Holders of Interests ($175 per Interest) and $2,668,455 to its
General Partner and Associate Limited Partners, collectively.