CONFORMED COPY

                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-K

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

                   For the fiscal year ended December 31, 2000
                                       OR

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

              For the transition period from ________ to __________

                         Commission File Number: 0-5537

                        INVESTMENT PROPERTIES ASSOCIATES
                        --------------------------------
             (Exact Name of Registrant as specified in its charter)

    A New York Limited Partnership                           13-2647723
   -------------------------------                      ------------------
   (State or other jurisdiction of                       (I.R.S. Employer
    incorporation or organization)                      Identification No.)

                  60 East 42nd Street, New York, New York 10165
               ---------------------------------------------------
               (Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (212) 687-6400

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

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

             820,000 Participations in Limited Partnership Interest
             ------------------------------------------------------
                                (Title of Class)

     Indicate  by check mark  whether the  Registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X No

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K (ss. 229.405 of this chapter) is not contained herein, and
will not be  contained,  to the best of  registrant's  knowledge,  in definitive
proxy or information  statements  incorporated  by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [X]

Aggregate  market  value  of the  voting  stock  held by  non-affiliates  of the
Registrant -- Not applicable.

              APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

     Indicate by check mark whether the  registrant  has filed all documents and
reports  required  to be  filed by  Section  12,  13 or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court.

     Yes_________        No_________

     Documents Incorporated by Reference -- None.


<PAGE>

                                     PART I

     This report contains  certain  forward-looking  statements.  Actual results
could differ materially from those projected in the  forward-looking  statements
as a result  of any  number  of  factors  discussed  herein  including,  without
limitation,   under  the  captions  "Management's  Discussion  and  Analysis  of
Financial Condition and Results of Operations" and "Business." When used in this
report, the words "anticipate,"  "estimate," "intend," "believe," "project," and
similar expressions are intended to identify  forward-looking  statements.  Such
statements are subject to certain risks,  uncertainties and assumptions.  Should
one or more of these risks or uncertainties  materialize,  or should  underlying
assumptions  prove  incorrect,  actual  results may vary  materially  from those
anticipated, expected, estimated, intended, believed or projected.

Item 1.  Business.

     Investment  Properties  Associates  ("IPA" or  "Registrant")  is a New York
limited partnership formed pursuant to a Limited Partnership  Agreement dated as
of May 15, 1969,  as amended on October 2, 1969,  October 31, 1969,  December 3,
1969, and May 30, 1997 (the "Partnership Agreement").

     Harry B.  Helmsley,  a General  Partner of  Registrant,  died on January 4,
1997. Upon his death, Mr. Helmsley's general partnership  interest in Registrant
was converted to a special limited partner interest,  which was inherited by his
spouse,  Leona M. Helmsley,  from Mr.  Helmsley's estate as of December 31, 1997
(the  "Converted  Special L.P.  Interest").  Under the terms of the  Partnership
Agreement as in effect on the date of Mr. Helmsley's death, the General Partners
were required to create a new limited  partnership  with the same  attributes as
Registrant and to convey all of the assets and liabilities of Registrant to such
entity.  Such action would have involved  substantial  transfer  tax,  insurance
premium  costs and other  related  expenses  and no benefit to the  partners  of
Registrant  or  to  the  holders  of  Participation  Interests   ("Participation
Interests" or "PPIs") in the limited partnership interest of the limited partner
of Registrant. Accordingly, Registrant obtained the approval of the holders of a
majority of the PPIs to, among other  things,  amend the Agreement to permit the
remaining  General  Partners to elect to continue the business of  Registrant in
the event of the  death of a General  Partner  and to make  such  election  with
respect to the death of Mr. Helmsley.  Such amendments were effective on May 30,
1997 (the "Amendments").  As contemplated by the amended Partnership  Agreement,
effective July 3, 1997, H Associates L.L.C. ("H Associates"), an entity owned by
Leona  M.  Helmsley,  was  admitted  as  a  General  Partner  of  Registrant.  H
Associates'  economic  interest in Registrant  was acquired from  Helmsley-Noyes
Company, Inc., also a General Partner of Registrant.

     On  June  10,  1998,  ScogBell  Acquisition,  L.L.C.,  a  Delaware  limited
liability  company  ("ScogBell"),  purchased  from  Leona  Helmsley  all  of her
interests in  Registrant.  The  interests  from this sale that were  acquired by
ScogBell from Leona Helmsley included,  among other things,  general partnership
interests  (0.05%),  special  limited  partnership  interests  (33.29%)  and  an
aggregate of 282,377 PPIs. Also on June 10, 1998,  ScogBell acquired 28,550 PPIs
in the over-the-counter  market. As a result, ScogBell became a beneficial owner
of 310,927 PPIs in Registrant which represents 37.9% of the outstanding PPIs.


<PAGE>

     At  December  31,  2000,  Registrant  owned fee  titles  to one  commercial
property in Newark,  New Jersey and two unimproved  real  properties in Houston,
Texas (collectively,  the "Properties").  During 2000,  Registrant sold three of
its properties.

     On January 18,  2000,  Registrant  sold its 50%  undivided  interest in the
Marbridge Building,  located at 1328 Broadway, in New York, New York for a sales
price of  $43,500,000.  In  connection  with the  sale,  Registrant  paid  sales
commissions  of  $1,646,000  to an affiliate of one of the General  Partners and
other closing costs of approximately $1,400,000.

     On May 8, 2000,  Registrant sold the 245 and 261 Fifth Avenue properties in
New York,  New York  together for a sales price of  $135,000,000.  In connection
with the sale,  Registrant paid sales  commissions of $5,110,000 to an affiliate
of one of  the  General  Partners  and  other  closing  costs  of  approximately
$4,400,000.

     Registrant declared a special  distribution of the net proceeds of the sale
from the Marbridge  Building of  $37,000,000.  A distribution of $18,500,000 was
paid to the General  Partners and Special  Limited  Partners in January 2000 and
$18,500,000 was paid to the holders of Participation Interests in February 2000.

     Registrant also declared a special  distribution of the net proceeds of the
sale  from  the  245  and  261  Fifth  Avenue  properties  of  $120,000,000.   A
distribution of $60,000,000 was paid to the General Partners and Special Limited
Partners in May 2000 and  $60,000,000  was paid to the holders of  Participation
Interests in June 2000.

     The $8,000,000 first mortgage loan with Apple Bank secured by the Marbridge
Building,  located at 1328  Broadway (in which  Registrant  had a 50% tenancy in
common interest) and which bore interest only at a rate of 8.5% per annum became
due on April 30, 1999.  Registrant  repaid its 50% share of such loan on January
18,  2000  upon the  sale of its 50%  tenancy  in  common  interest  in the 1328
Broadway property.

     As a result  of the sale of its 50%  undivided  interest  in the  Marbridge
Building and of the 245 and 261 Fifth Avenue properties,  Registrant's remaining
properties consist of a commercial property located in Newark, New Jersey (which
is  currently  vacant) and two  unimproved  parcels  located in Houston,  Texas.
Neither of these properties are currently  leased.  Registrant will seek to sell
these  properties in 2001,  but there can be no  assurances  that a sale will be
concluded.

     (a) Financial Information About Segments. Registrant's sole business is the
ownership and operation of commercial real estate. All of Registrant's revenues,
operating profit or loss and assets relate solely to such industry segment.

     (b) Narrative  Description of Business.  Registrant's only business was the
ownership and operation of commercial real properties which it leased to various
tenants.  As  previously  discussed,  during  2000  Registrant  disposed  of its
remaining  income producing  properties and, at December 31, 2000,  Registrant's
remaining  properties  consisted  of one  vacant  commercial  property  and  two
unimproved  parcels of land.  The  primary  cost  associated  with  Registrant's
remaining properties is real estate taxes.


                                       2
<PAGE>

All of the properties owned and operated by Registrant are set forth in Item 2.

     Registrant's  needs for working capital are provided for with existing cash
balances which were generated from the sale of properties.

     Registrant  employs  three people who handle  maintenance  of its remaining
properties.  All of the Registrant's  other operating  functions,  which consist
primarily of property management and administrative  services,  are performed by
Helmsley-Spear,  Inc. ("HSI") or affiliates of HSI, which entities may be deemed
to be affiliates of Registrant.  Management fees and leasing commissions charged
by HSI aggregated  approximately $393,000 during the fiscal years ended December
31, 2000, $1,288,000 in 1999 and $1,969,600 in 1998. HSI also earned $6,754,000,
$3,962,000  and  $3,025,000  in brokerage  commissions  in 2000,  1999 and 1998,
respectively,  in connection with the sale of the 50% undivided  interest in the
Marbridge  Building and the 245 Fifth Avenue and 261 Fifth Avenue  properties in
2000, the Mojud and 1440 Broadway properties in 1999, and the Chicago Properties
in 1998.  Registrant  believes  that such  services  are supplied at prices that
approximate those that would be available from non-affiliates. See Item 13.

Item 2.  Properties.

     General. At December 31, 2000,  Registrant's Properties included fee titles
to one commercial property located in Newark, New Jersey and two unimproved real
properties located in Houston, Texas.

     The table below sets forth a description of each of the Properties owned by
Registrant on December 31, 2000,  its  location,  type of ownership and rentable
area in square feet.


                                       3
<PAGE>

<TABLE>
<CAPTION>

                                                                             Total Rentable
Property                         Description               Ownership          Area (Sq. Ft.)
--------                         -----------               ---------          --------------
<S>                              <C>                         <C>                  <C>
Texas

Edgewood Shopping Center
(Houston)                        Unimproved Land             Fee                       --

Bellway Shopping Center
(Houston)                        Unimproved Land             Fee                       --

New Jersey

570 Broad Street (Newark)(1)     14-story office bldg.       Fee                  190,000
</TABLE>

Item 3.  Legal Proceedings.

     There are no material  pending legal  proceedings to which  Registrant is a
party or of which any of Registrant's property is the subject.

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

     No  matters  were  submitted  to a vote of  holders of PPIs at a meeting or
otherwise during the fourth quarter of 2000.

---------------------------
(1)  Vacant since 1996

                                       4
<PAGE>

                                     PART II

Item 5.  Market for the Registrant's Participation Interests
         and Related Security Holder Matters.

     As discussed above, Registrant is a limited partnership. PPIs represent the
beneficial interest of the Registrant's sole Limited Partner. As of December 31,
2000,  there was no  regular  market for these  securities  and  quotations  are
limited and sporadic. During the third quarter, PPI's ceased to be traded in the
over-the-counter  market  on the  National  Association  of  Securities  Dealers
Automated Quotations System ("NASDAQ"). The symbol is "IVPA."

     The  range  of  high  and  low  closing  bid  quotations  for  PPIs  in the
over-the-counter market for the two most recent years was as follows:

                                  2000 (1)                        1999
                          ----------------------         ---------------------
                           High            Low            High            Low
                          ------         -------         ------          -----

          First Qtr.        150            50             117              69
          Second Qtr.        80             3 3/4         119 1/2         105
          Third Qtr.          9             6             120             105
          Fourth Qtr.         7             5             150             114

      The foregoing over-the-counter quotations represent prices between dealers
and do  not  include  retail  mark-up,  mark-down  or  commission  and  may  not
necessarily  represent actual transactions.  As of December 31, 2000, there were
510 holders of record of PPIs.


                                       5
<PAGE>

     Pursuant  to the  Partnership  Agreement,  Registrant  is  required to make
certain cash  distributions to holders of PPIs. Net operating  revenues for each
calendar year are  distributable to the partners of Registrant  approximately as
follows:

       General Partners (as a group):                             .55%
              Irving Schneider

              Minlyn, Inc.

              ScogBell AG, Inc. (formerly known as
              Helmsley-Noyes Company, Inc.)

              ScogBell

           Converted Special L.P. Interest

              ScogBell                                            .95%
           Special Limited Partners (as a group):               48.50%

              ScogBell
              Irving Schneider

           Limited Partner (nominee for
           holders of PPIs):                                     50.0%

     The  Limited  Partner  is the  nominee  for the  holders  of  PPIs  and all
distributions  to the Limited Partner are distributed  ratably to the holders of
820,000  Participation  Interests.  If with  respect  to any  calendar  year the
Limited Partner's distributive share (computed on the same basis as that used in
preparing  Registrant's  Federal  income  tax  return)  of income  (loss),  plus
one-half  of such  partner's  distributive  share of  long-term  capital  gains,
exceeds the net operating  revenue  allocated to the Limited Partner as referred
to in the preceding paragraph,  then Registrant must also distribute  additional
funds in an amount  equal to such excess to the holders of PPIs.  If  Registrant
does not have funds for such distribution (from cash on hand or borrowings), the
Partnership Agreement obligates the General Partners to lend or contribute funds
to Registrant for such purpose.

     In 2000,  Registrant had "net operating  revenues" of $3,908,231,  of which
$1,954,116 in the aggregate (or $2.38 per PPI) was  distributed on April 2, 2001
to the holders of record of PPIs as of December  31,  2000 and an  aggregate  of
$1,954,116  was also  distributed  to the Special  Limited  Partners and General
Partners on that date.  See  "Management's  Discussion and Analysis of Financial
Condition and Results of Operations."

     In 1999,  Registrant had "net operating revenues" of $12,606,987,  of which
$6,949,055 in the aggregate (or $8.47 per PPI) was distributed on March 31, 2000
to the holders of record of PPIs as of December  31,  1999 and an  aggregate  of
$6,949,055  was also  distributed  to the Special  Limited  Partners and General
Partners on that date.  See  "Management's  Discussion and Analysis of Financial
Condition and Results of Operations."

     "Net operating revenues" is defined in Registrant's  partnership  agreement
as follows:  for any year, (i) net taxable income of the  Registrant,  plus (ii)
depreciation and amortization  expenses allowable for income tax purposes during
such  year  (but  only  to  the  extent  of  mortgage  repayments),  (iii)  plus
amortization  of Bond issuance  costs and Bond  discount  (which is not relevant
after 1994),  (iv) plus  amortization  of financing  costs,  (v) less  principal
repayments on mortgages.  In recent years,  cash  distributions  to Registrant's
partners have generally  exceeded the amount defined as net operating  revenues.
See Item 7 below.


                                       6
<PAGE>

Item 6.  Selected Financial Data.

<TABLE>
<CAPTION>

                                                2000                1999              1998               1997               1996
                                                ----                ----              ----               ----               ----
<S>                                         <C>                <C>                <C>                <C>                <C>
Income Statement Data

Gross revenues from                         $  5,969,098       $ 31,640,834       $ 43,454,081       $46,463,473         $52,216,081
real estate

Net Income transferred to                   $153,829,678       $150,779,832       $112,747,733       $ 8,726,836         $ 8,452,069
Partner's capital accounts

Net operating revenues, as                  $  3,908,231       $ 12,606,987       $  9,803,570       $ 9,174,787         $ 8,342,911
defined

Net income per PPI: (1)                     $    65.3015       $    87.8823       $    60.4848       $    5.5280         $    5.8636

Balance Sheet Data

Total assets                                $ 12,959,799       $102,611,031       $ 49,762,234       $53,585,976         $55,393,657

Mortgages payable                           $         --       $  4,000,000       $ 23,847,488       $36,847,488         $40,314,558

Affiliate Loans                             $         --       $         --       $         --       $18,000,000         $18,000,000
</TABLE>

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

(1)  Net income per PPI for 2000  reflects the  reallocation  of income from the
     capital account of the Limited Partner and the credit of such amount to the
     capital  accounts of the General Partners and Special Limited Partners from
     the numbers  previously  reported for the quarter  ended June 30, 2000,  as
     described  in Note 14 of the Notes to Financial  Statements.  The impact of
     such adjustment on Net Income per PPI was  ($22.2117),  but such adjustment
     had no impact on  reported  net income of  Registrant  and no impact on the
     amount of  entitlement  to the net  proceeds  from the sale of  partnership
     property  of the  General  Partners,  Special  Limited  Partners or Limited
     Partner.

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

         Liquidity and Capital Resources

     As  previously  discussed,  Registrant  disposed  of its  remaining  income
producing  properties  during  2000  and  at  December  31,  2000,  Registrant's
remaining  properties  consist of one vacant commercial  property in Newark, New
Jersey and two unimproved  parcels of land in Houston,  Texas.  Registrant  will
seek to dispose of its  remaining  properties in 2001 and wind down its affairs,
although no assurances can be made in this regard.

     Registrant  has sold  significant  assets during 2000 and will seek to sell
remaining  assets in 2001, but there can be no assurance that such sales will be
consummated.

     On January 18,  2000,  Registrant  sold its 50%  undivided  interest in the
Marbridge  Building  located at 1328 Broadway in New York,  New York for a sales
price of  $43,500,000.  In connection with the sale,  Registrant  repaid its 50%
share of the  outstanding  mortgage with Apple Bank of $4,000,000,  paid a sales
commission of $1,646,000 to an affiliate of one of the General Partners and paid
other closing costs of approximately $1,400,000.


                                       7
<PAGE>

     On May 8, 2000,  Registrant sold the 245 and 261 Fifth Avenue properties in
New York,  New York for a combined  sales price of  $135,000,000.  In connection
with the sale, Registrant paid sales commission of $5,110,000 to an affiliate of
one of the General Partners and other closing costs of approximately $4,400,000.

     Registrant is required to make certain cash  distributions  to its partners
for each year.  See Item 5. On January 18, 2000,  Registrant  declared a special
distribution  of $37,000,000 to its partners in connection with the sale on such
date of Registrant's 50% undivided interest in the Marbridge Building,  of which
$18,500,000  was paid to the General  Partners and Special  Limited  Partners in
January 2000 and $18,500,000 was paid to the holders of PPIs in February 2000.

     On May 8, 2000,  Registrant declared a special distribution to its partners
of  approximately  $120,000,000  in connection  with the sale of the 245 and 261
Fifth Avenue  properties,  of which $60,000,000 was paid to the General Partners
and Special Limited Partners in May 2000 and $60,000,000 was paid to the holders
of Participation Interests in June 2000.

     Registrant  anticipates  satisfying its working  capital  requirements  for
fiscal year 2001  generally  through  existing  cash  reserves  from the sale of
properties and/or the sale of its remaining Properties.

     Net cash provided by operating activities was approximately $4.4 million in
2000, as compared to $12.4  million in 1999.  Such decrease was primarily due to
decreased  property  operating  income as a result  of the sale of  Registrant's
properties  in  New  York.  Net  cash  provided  by  investing   activities  was
approximately  $164.4  million in 2000,  as compared to $148.2  million in 1999.
Such  increase  was  primarily  attributable  to a net  increase in the proceeds
received  from  the  sales of  properties  of $15.4  million.  Net cash  used in
financing  activities  was  approximately  $239 million in 2000,  as compared to
$94.7   million  in  1999.   Such   increase  was  primarily  due  to  increased
distributions of approximately $160.2 million.

     Impact of Year 2000

     Registrant did not experience any material  problems  relating to Year 2000
issues,  either with its internal  systems or the products and services of third
parties.


                                       8
<PAGE>

     Results of Operations

2000 Compared to 1999

     Gross  Revenues from rentals for 2000 decreased  approximately  $25,672,000
(approximately  81%) as  compared  to 1999,  primarily  due to the impact of the
sales of the 50% undivided  interest in the Marbridge  Building (sold in January
2000), the 245 Fifth Avenue and 261 Fifth Avenue  properties (sold in May 2000),
and the 1440 Broadway property (sold in December 1999). Total expenses decreased
by   approximately   $14,160,000   (approximately   79%)  as  a  result  of  the
aforementioned  property  sales.  Net  income for 2000  increased  approximately
$3,050,000 primarily due to an increase of approximately $14,065,000 in the gain
on sale of real  estate  offset by a decline  in  property  operating  income of
approximately $11,196,000 as a result of the aforementioned property sales.

     During 2000,  Registrant's rental income was generated by the operations of
its 50%  undivided  interest in the  Marbridge  Building  and of the 245 and 261
Fifth Avenue properties, which were sold during 2000.

     For 2000, Registrant's interest expense decreased approximately  $1,633,000
(approximately  97%),  due to the  repayment  of  Registrant's  50% share of the
$8,000,000  mortgage  loan on the  Marbridge  Building  on January  18,  2000 in
connection  with  the  sale  of  Registrant's  50%  undivided  interest  in such
property.

     Registrant's  real  estate  tax  expense  in 2000  decreased  approximately
$4,086,000 (approximately 88%), due to the sale of its 50% undivided interest in
the  Marbridge  Building  in January  2000 and the sale of the 261 and 245 Fifth
Avenue properties in May 2000. Registrant,  under certain commercial leases, was
able to pass a portion of the increases in real estate taxes, operating expenses
and  increases  in the  consumer  price  index  to the  tenants  based  on lease
escalation clauses.

     Management fees decreased  approximately $407,000  (approximately 79%), due
to the sale of the aforementioned properties.

     Payroll   and   related   expenses   decreased   approximately   $1,467,000
(approximately 77%), due to the sale of the aforementioned properties.

     Repairs and maintenance expenses decreased approximately  $1,544,000 (87%),
due to the sale of the aforementioned properties.

     Other property expenses decreased approximately  $3,089,000  (approximately
79%), due to the sale of the aforementioned properties.

     Administrative expenses increased approximately $44,000 (approximately 7%),
due to the increased professional fees associated with the administration of the
partnership activities.

     Depreciation and amortization expenses decreased  approximately  $1,978,000
(approximately 70%), due to the aforementioned sales.


                                        9
<PAGE>

1999 Compared to 1998

     Gross  revenues from rentals for 1999 decreased  approximately  $11,813,000
(approximately  27%) as compared to 1998,  primarily due to decreases in revenue
due to the impact of the sale of the Chicago Properties (sold in September 1998)
and the sale of the  Mojud  Building  (sold in April  1999),  offset  in part by
increases in revenue from Registrant's other New York properties. Net income for
1999  increased  approximately  $38,032,000  primarily  due  to an  increase  of
$35,139,000  in the gain on sale of  properties.  Total  expenses  decreased  by
approximately  $14,764,000  (approximately  45%) as a result  of the sale of the
Chicago Properties in September 1998 and the Mojud Building in April 1999.

     During 1999,  Registrant's  rental  income was  generated  primarily by the
operations of its New York  properties.  Leasing  activity remains active in New
York and  Registrant  anticipates  continuing  its practice of  negotiating  new
leases and renewing existing leases upon their expiration;  however, there is no
assurance that some of Registrant's tenants will not go out of business,  reduce
their space requirements or relocate.

     For 1999, Registrant's interest expense decreased approximately  $2,166,000
(approximately  56%),  primarily  due to lower  levels  of  average  outstanding
indebtedness  during 1999 which resulted from mortgage  principal  repayments of
$13,000,000  made in 1998 and the  repayments of Affiliate  Loans of $18,000,000
made in 1998.  In addition,  Registrant  repaid the  outstanding  balance of its
mortgage loan with Chase in December 1999.

     Registrant's  real  estate  tax  expense  in 1999  decreased  approximately
$2,515,000  (approximately  35%),  due to the sale of the Chicago  Properties in
September  1998 and the sale of the Mojud  building in April  1999.  Registrant,
under certain  commercial  leases, is able to pass a portion of the increases in
real estate taxes,  operating expenses and increases in the consumer price index
to the tenants based on lease escalation clauses.

     Management fees decreased  approximately $605,000  (approximately 54%), due
to the sale of the  Chicago  Properties  in  September  1998 and the sale of the
Mojud building in April 1999.

     Payroll   and   related   expenses   decreased   approximately   $2,323,000
(approximately 55%), due to the sale of the Chicago Properties in September 1998
and the sale of the Mojud building in April 1999.

     Repairs  and  maintenance  expenses  decreased   approximately   $1,357,000
(approximately 43%), due to the sale of the Chicago Properties in September 1998
and the sale of the Mojud building in April 1999.

     Other property expenses decreased approximately  $4,550,000  (approximately
54%),  due to the sale of the Chicago  Properties in September 1998 and the sale
of the Mojud building in April 1999.

     Administrative  expenses increased  approximately  $283,000  (approximately
91%), due to increased  professional fees associated with the  administration of
partnership activities and increased regulatory filing requirements.

     Depreciation and amortization expenses decreased  approximately  $1,098,000
(approximately 28%), due to the sale of the Chicago Properties in September 1998
and the sale of the Mojud building in April 1999.


                                       10
<PAGE>

Item 7A. Disclosures About Market Risk.

     At December 31, 2000,  Registrant had no interest bearing  indebtedness and
accordingly  was not exposed to market risk with  respect to changes in interest
rates, and does not anticipate a need to seek additional borrowing.

Item 8.  Financial Statements and Supplementary Data.

     The  response  to this Item is  submitted  in a  separate  section  of this
report.

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

         None.


                                       11
<PAGE>

                                    PART III

Item 10. General Partners of the Registrant.

     (a) (b) Identification of General Partners.

     Registrant  is a  limited  partnership.  It  does  not  have  directors  or
executive officers.  The information set forth below is provided with respect to
the  General  Partners  of the  Registrant,  who  may be  considered  to  occupy
positions  equivalent to directors or executive  officers.  There is no specific
term of office for any General Partner of the Registrant.  Each General Partner,
with the exception of ScogBell,  has served in such capacity  since  December 4,
1969.

     The names, ages, and business  experience during the past five years of the
General  Partners of the Registrant,  including their principal  occupations and
employment  during  that  period  and the name  and  principal  business  of any
corporation or other  organization in which such occupations and employment were
carried on, is as follows:

     Irving Schneider - 81; Executive Vice President of Helmsley-Spear, Inc. Mr.
Schneider  has been in the real estate  business  for over 50 years and owns and
operates,   individually   or  through   partnerships,   numerous   real  estate
investments.

     Minlyn,  Inc.  was  formed  in  1968.  All of its  stock  is  owned  by Mr.
Schneider.  Mr.  Schneider is a director of Reliance  Group  Holdings,  Inc. and
Reliance Insurance Company.

     Registrant  has been  advised  that  ScogBell  was  created in June 1998 to
acquire, hold, finance and sell interests in Registrant.  Control of ScogBell is
vested exclusively with ScogBell AG Manager, Inc. and ScogBell SB Manager, Inc.,
as managers.

     ScogBell AG, Inc.  (formerly known as  Helmsley-Noyes  Company,  Inc.), was
incorporated  in 1926 and it is a real estate  management  firm in New York City
which was acquired by ScogBell on June 10, 1998.

     Harry B. Helmsley was a General  Partner of  Registrant  until his death on
January 4, 1997.  He was succeeded by H Associates on July 3, 1997. H Associates
acquired a nominal general partner interest from  Helmsley-Noyes  Corporation in
connection  with  its  admission  as a  General  Partner.  On June 10,  1998,  H
Associates  ceased to be a General  Partner of  Registrant  and was  replaced by
ScogBell  as a  General  Partner  pursuant  to a sale of its  entire  beneficial
ownership position. See "Business."

Item 11. Executive Compensation.

     Registrant is a limited partnership.  It does not have officers,  executive
officers or directors.  The information set forth below is provided with respect
to the General Partners and the Special Limited Partners of the Registrant,  who
may  be  considered  to act in  capacities  similar  to  directors,  or  perform
policy-making  functions  similar to those of executive  officers or officers in
charge of a principal business unit, division or function.

     Paragraph  11A(3)  of  the  Partnership   Agreement  provides  for  certain
guaranteed  payments to be made to the  General  Partners  and  Special  Limited
Partners of Registrant  equal to 8-3/4% per annum of their  "Remaining  Original
Cash Contribution." The Remaining Original Cash Contribution is $1,500,000, less


                                       12
<PAGE>

the cumulative  amounts  distributed to the General Partners and Special Limited
Partners  from  time to time in  respect  of the net  proceeds  from the sale of
Registrant's properties. The Remaining Original Cash Contribution as of December
31, 2000 was $1,160,000. For the fiscal year ended December 31, 2000, Registrant
paid or accrued,  pursuant to such paragraph 11A(3),  guaranteed payments to the
General  and Special  Limited  Partners  in an  aggregate  amount of $101,500 as
follows:  Irving  Schneider  - $33,732,  ScogBell - $67,576,  ScogBell  AG, Inc.
(formerly known as Helmsley-Noyes Company, Inc.) - $91 and Minlyn, Inc. - $101.

     Under the terms of the  Partnership  Agreement,  since January 1, 1973, the
General  Partners are entitled to receive an annual payment equal to 1/2% of the
gross  revenue  from real  estate of  Registrant.  During the fiscal  year ended
December 31, 2000, Registrant accrued in connection with such annual payments an
aggregate of $34,054 as follows:  Irving Schneider - $10,216,  ScogBell AG, Inc.
(formerly known as Helmsley-Noyes  Company,  Inc.) - $1,022,  ScogBell - $21,681
and Minlyn,  Inc. - $1,135.  Mr.  Schneider and ScogBell are entitled to receive
distributions of net operating  revenues in each of their respective  capacities
as Special Limited Partners. See "Item 5" above.

     Registrant does not provide any compensation to the General Partners or the
other  persons  in the  form of  option  or  stock  appreciation  right  grants,
long-term  incentive  plans,  or a  defined  benefit  or  actuarial  plans.  The
Registrant has no standard  arrangements for payment of fees to General Partners
(other than for their  interest as General  Partners,  as described  above),  or
employment contracts or change-of-control agreements.

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

     (a)  Registrant  is a limited  partnership.  Except to the extent set forth
below, it does not have voting securities.  The right to control the business of
Registrant  is  vested  in the  General  Partners  of  Registrant  by  virtue of
provisions  of  the  Partnership  Agreement  and  Article  8A of  the  New  York
Partnership Law.

     The Partnership  Agreement  provides for  modification or amendments of the
Partnership  Agreement  upon  obtaining  the  consents or  affirmative  votes of
specified  percentages of the Special Limited Partners and the Limited Partners,
each  voting as a class.  The sole  limited  partner  votes as  directed  by the
holders of PPIs.

     To the extent that the Special Limited  Partnership  Interests and PPIs are
considered  voting  securities,  the  following  information  is  provided as to
holders of 5% or more of each such class at December 31, 2000:


                                       13
<PAGE>

<TABLE>
<CAPTION>
                                                                     Amount and
                                                                      Nature of
                                Name and Address of                   Beneficial           Percent
Title of Class                  Beneficial Owner                      Ownership            of Class
--------------                  -------------------                  -----------           ---------
<S>                             <C>                                     <C>                <C>
Special Limited                 ScogBell                                Direct              66.66%
Partnership Interest            660 Madison Ave.
                                New York, NY  10021

                                Irving Schneider                        Direct              33.34%
                                880 Fifth Avenue
                                New York, NY

Converted Special               ScogBell                                Direct             100.00%
Limited Partner Interest        660 Madison Ave.
                                New York, NY  10021

PPIs                            ScogBell                                310,927(1)          37.92%
                                660 Madison Ave.
                                New York, NY  10021

                                Long Island Jewish Medical Center       90,095              10.99%
                                270-05 76th Avenue                      Direct
                                New Hyde Park, NY 11040
</TABLE>

---------------------
(1)  Includes PPIs purchased from the following:  258,877 PPIs owned directly by
     Leona M. Helmsley;  also 4,000 PPIs held by  Helmsley-Noyes  Company,  Inc.
     (0.5%),  a company owned by Helmsley  Enterprises,  Inc.,  which in turn is
     wholly-owned  by the Harry B. Helmsley  Revocable  Trust,  under  agreement
     dated  December 13, 1989;  13,000 PPIs held by HBH Holdings  Corp.  (1.6%),
     6,500 PPIs held by Park Lane  Hotel,  Inc.  (0.8%)  and 28,550  PPIs in the
     over-the-counter market.


                                       14
<PAGE>

     (b)  Registrant  is a limited  partnership  and,  as such,  its affairs are
managed by its General  Partners.  The following table sets forth the amount and
nature  of the  beneficial  ownership  at  December  31,  2000 of each  class of
partnership interests by its General Partners individually and as a group:

<TABLE>
<CAPTION>
                                                                     Amount and
                                                                      Nature of
                                Name and Address of                   Beneficial           Percent
Title of Class                  Beneficial Owner                      Ownership            of Class
--------------                  -------------------                  -----------           --------
<S>                             <C>                                     <C>                <C>
General Partnership             Irving Schneider
Interests                       880 Fifth Avenue
                                New York, NY                            Direct(1)           90.91%

                                ScogBell                                Indirect             9.09%
                                660 Madison Ave.
                                New York, NY  10021

                                As a group                                                 100.00%

Special Limited                 ScogBell                                Direct(2)           66.66%
Partnership Interests           660 Madison Ave.
                                New York, NY  10021

                                Irving Schneider                        Direct(1)           33.34%
                                880 Fifth Avenue
                                New York, NY
                                As a group                                                 100.00%

Converted Special
Limited Partner Interest        ScogBell                                Direct(2)          100.00%
                                660 Madison Ave.
                                New York, NY  10021

Participation Interests         ScogBell                                310,927             37.92%
                                660 Madison Ave.
                                New York, NY  10021                     Direct(3)
</TABLE>

---------------------
(1)  Mr. Irving Schneider owns  approximately  90% of such interest directly and
     10% indirectly through his ownership of Minlyn,  Inc.; 60 East 42nd Street,
     New York, New York, which is also a General Partner of Registrant.

(2)  The Special Limited Partnership  Interests have the rights set forth in the
     Partnership  Agreement and are not  securities  issued by  Registrant.  The
     Converted  Special  L.P.  Interest  represents  the  economic  interest  in
     Registrant formerly owned by Harry B. Helmsley in his capacity as a General
     Partner. See "Business."

(3)  Includes PPIs purchased from the following:  258,877 PPIs owned directly by
     Leona M. Helmsley;  also 4,000 PPIs held by  Helmsley-Noyes  Company,  Inc.
     (0.5%),  a company owned by Helmsley  Enterprises,  Inc.,  which in turn is
     wholly-owned  by the Harry B. Helmsley  Revocable  Trust,  under  agreement
     dated  December 13, 1989;  13,000 PPIs held by HBH Holdings  Corp.  (1.6%),
     6,500 PPIs held by Park Lane  Hotel,  Inc.  (0.8%)  and 28,550  PPIs in the
     over-the-counter market.


                                       15
<PAGE>

Item 13. Certain Relationships and Related
         Transactions.

     (a)  Transactions with Management and Others.

     (b)  Certain Business Relationships.

     As set forth in Item 11(a) above,  during the year ended December 31, 2000,
Registrant  paid  certain  fees and certain  guaranteed  payments to each of its
corporate General Partners,  ScogBell AG, Inc. (formerly known as Helmsley-Noyes
Company, Inc.) and Minlyn, Inc., pursuant to the Partnership Agreement. See Item
10 hereof as to the  ownership of said  corporations.  HSI,  either  directly or
through various subsidiaries, acts as managing agent of the Properties. For such
management and leasing brokerage services,  HSI charged Registrant the aggregate
sum of  approximately  $393,000  during the fiscal year ended December 31, 2000.
Leasing  commissions  charged by HSI are based upon varying  percentages  of the
annual rent paid by tenants obtained by HSI. Property management fees charged by
HSI are based upon negotiated amounts that are believed to be below market rate.
Leasing fees charged by HSI to Registrant are believed to be, from  Registrant's
perspective,  on a basis  that  approximate  those that  would be  available  to
Registrant  from  non-affiliates  at  arm's-length.  In 2000,  HSI  also  earned
$6,754,000  in  brokerage  commissions  in  connection  with the sale of the 50%
undivided  interest in the  Marbridge  Building and the 245 Fifth Avenue and 261
Fifth Avenue properties. The amount of the commissions paid for such services is
believed by Registrant to be no more than the amount which  Registrant  would be
required to pay to unrelated parties performing such services.

     (c)  Indebtedness of Management.
          None.


                                       16
<PAGE>

                                     PART IV

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

     (a) (1) and (2) The  response to this  portion of Item 14 is submitted as a
separate section of this report.

     (a) (3)  Exhibits.  Subject to Rule  12b-32 of the  Securities  Act of 1934
regarding  incorporation  by reference,  listed below are the exhibits which are
filed as part of this report and are hereby incorporated by reference (according
to the numbers assigned to them in Item 601 of Regulation S-K):

          (3)(i)    Registrant's  Limited Partnership  Agreement dated as of May
                    15, 1969,  as amended on October 2, 1969,  October 31, 1969,
                    and December 3, 1969 is hereby  incorporated by reference to
                    Exhibits 3.1, 3.2, 3.3 and 3.4 to Registration Statement No.
                    2-33132 which was declared  effective by the SEC on December
                    4, 1969.

          (ii)      Amendment to Agreement of Limited  Partnership,  dated as of
                    May 30, 1997.

          (10.1)    Management    Agreement   dated   May   20,   1969   between
                    Helmsley-Spear,  Inc. and Registrant is hereby  incorporated
                    by reference to Exhibit 12.1 to  Registration  Statement No.
                    2-33132.   The  leasing   commissions  and  management  fees
                    currently  being charged to the  Registrant  are  consistent
                    with the rates  generally  charged  in the  areas  where the
                    properties are located.

          (10.2)    Forms  of  Promissory   Notes,   dated  November  30,  1994,
                    evidencing  the Affiliate  Loans is hereby  incorporated  by
                    reference  to Exhibit  10.2 of  Registrant's  Report on Form
                    10-K for the fiscal year ended December 31, 1994.

     (b) Reports on Form 8-K filed during the period covered by this Report:

               (i) On May 10, 2000,  Registrant  filed a Current  Report on Form
          8-K relating to the completion of the sale of 245 Fifth Avenue and 261
          Fifth Avenue, New York, N.Y. for $135,000,000

               (ii) On April 25, 2000, Registrant filed a Current Report on Form
          8-K  relating to the  contract to sell 245 Fifth  Avenue and 261 Fifth
          Avenue, New York, New York for $135,000,000.

               (iii) On April 13,  2000,  Registrant  filed a Current  Report on
          Form 8-K  relating to its  intention  to sell 245 Fifth Avenue and 261
          Fifth Avenue, New York, New York.

               (iv) On February 15, 2000  Registrant  filed a Current  Report on
          Form 8-K relating to the sale of 1440  Broadway,  New York,  New York,
          for $152,000,000

               (v) On January 21,  2000,  Registrant  filed a Current  Report on
          Form 8-K relating to the sale of 1328 Broadway, New York, New York for
          $43,500,000.

     (d) Financial Statement Schedules-- The response to this portion of Item 14
is submitted as a separate section of this report.


                                       17
<PAGE>

                                   SIGNATURES

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

                                     INVESTMENT PROPERTIES ASSOCIATES

                                     By: /s/ Irving Schneider
                                        --------------------------------
                                            Irving Schneider
                                            General Partner

Dated:  April 12, 2001

     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the date first indicated above.

/s/ Irving Schneider
----------------------------       General Partner,
Irving Schneider                   Principal Executive,
                                   Financial and
                                   Accounting Officer

MINLYN, INC.                       General Partner

By: /s/ Irving Schneider
   -------------------------
      Irving Schneider
      President

SCOGBELL AG, INC.                  General Partner

By: /s/ Craig Effron
   -------------------------
      Craig Effron
      President

SCOGBELL ACQUISITION, L.L.C.       General Partner

By: /s/ Craig Effron
   -------------------------
      President
      ScogBell AG Manager, Inc., Manager


<PAGE>

                           Annual Report On Form 10-K

                      Item 14(A)(1) And (2) And Item 14(D)

          List Of Financial Statements And Financial Statement Schedule

              Financial Statements And Financial Statement Schedule

                          Year Ended December 31, 2000

                        Investment Properties Associates
                        (A New York Limited Partnership)

                               New York, New York


<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

         Index Of Financial Statements And Financial Statement Schedule

                                                                            Page
                                                                            ----
Report of Independent Auditors...............................................S-1
Balance Sheets-December 31, 2000 and 1999............................S-2 and S-3
Statements of Income-Years Ended December 31, 2000
  1999 and 1998......................................................S-4 and S-5
Statements of Changes in Partners' Capital (Deficiency)-
  Years Ended December 31, 2000, 1999 and 1998...............................S-6
Statements of Cash Flows-Years Ended December 31, 2000
  1999 and 1998..............................................................S-7
Notes to Financial Statements........................................S-8 to S-21

The following financial statement schedule of Investment  Properties  Associates
is included in Item 14(d):

Schedule III-Real Estate and Accumulated Depreciation..............S-22 and S-23

All other  schedules for which  provision is made in the  applicable  accounting
regulation of the Securities and Exchange  Commission are not required under the
related  instructions,  are inapplicable or have been otherwise  disclosed,  and
therefore have been omitted.


<PAGE>

                         Report of Independent Auditors

Investment Properties Associates

We have  audited  the  accompanying  balance  sheets  of  Investment  Properties
Associates  (a New York Limited  Partnership)  as of December 31, 2000 and 1999,
and the related statements of income,  changes in partners' capital (deficiency)
and cash flows for each of the three  years in the  period  ended  December  31,
2000. Our audits also included the financial  statement  schedule  listed in the
index at Item 14. These financial statements and schedule are the responsibility
of the Partnership's management.  Our responsibility is to express an opinion on
these financial statements and schedule based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial  position  of  Investment   Properties
Associates at December 31, 2000 and 1999,  and the results of its operations and
its cash flows for each of the three  years in the  period  ended  December  31,
2000, in conformity with accounting  principles generally accepted in the United
States.  Also, in our opinion,  the related financial statement  schedule,  when
considered  in  relation  to the basic  financial  statements  taken as a whole,
presents fairly in all material respects the information set forth therein.

                                                  /s/ ERNST & YOUNG LLP

New York, New York
March 22, 2001


                                      S-1
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                                 Balance Sheets

                                                              December 31,
                                                          2000          1999
                                                      -------------------------
  Assets

Real estate, at cost (Notes 3 and 5)                  $ 8,033,347  $ 40,649,960
   Less accumulated depreciation
     and amortization                                   5,880,040    26,391,697
                                                      -------------------------
                                                        2,153,307    14,258,263

Cash and cash equivalents                               9,514,349    79,770,013

Due from managing agent (Helmsley-
   Spear Inc.) including tenants'
     security deposits of $-- (2000)
      and $1,963,001 (1999) (Note 6)                      730,578     2,822,168

Receivables, principally for rentals                        8,215       467,232

Deferred charges, including deferred
   leasing commissions of $-- (2000) and
   $2,115,053 (1999)
   (Note 6)                                               553,350     5,293,355
                                                      -------------------------
Total assets                                          $12,959,799  $102,611,031
                                                      =========================

                             See accompanying notes.


                                      S-2
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                                 Balance Sheets

                                                              December 31,
                                                           2000          1999
                                                       ------------------------
Liabilities and partners' capital
(deficiency)

Accounts payable                                      $   113,368  $    678,177
Accrued real estate taxes                                  11,086     1,480,861
Accrued interest                                               --        29,278
Distributions payable to General Partners,
  Special Limited Partners and Limited
  Partner (Note 9)                                      3,915,446    77,979,781
Guaranteed payments due to General
  Partners, Special Limited Partners and
  Limited Partner (Note 7)                                180,553       300,721
Accrued leasing commissions and
  management fees due to Helmsley-
  Spear, Inc. (Note 6)                                     41,820       231,113
Sundry and accrued liabilities                            172,545       610,712
Mortgage payable (Note 5)                                      --     4,000,000
Deposits, and rents received in advance of
  $-- (2000) and $85,406 (1999)                                --     1,696,853
                                                      -------------------------
Total liabilities                                       4,434,818    87,007,496
                                                      -------------------------


Commitments and contingencies
  (Notes 10 and 13)


Partners' capital (deficiency)
  (Notes 1, 7 ,8, 9 and 14):
    General Partners                                   (2,465,397)   (2,683,508)
    Special Limited Partners                            5,966,387    13,643,808)
    Limited Partner (represented by
      the equivalent of 820,000
      Participation Interests)                          5,023,991    31,930,851
                                                      -------------------------
                                                        8,524,981    15,603,535
                                                      -------------------------
Total liabilities and partners'
   capital (deficiency)                               $12,959,799  $102,611,031
                                                      =========================

                             See accompanying notes.


                                      S-3
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                              Statements of Income

<TABLE>
<CAPTION>
                                                                     Year ended December 31,
                                                               2000          1999              1998
                                                         ---------------------------------------------
<S>                                                      <C>              <C>               <C>
Revenues:
Gross revenues from real estate (Note 11)                $  5,969,098   $ 31,640,834      $ 43,454,081
Interest and other income                                   1,174,914        798,599           917,010
                                                         ---------------------------------------------
                                                            7,144,012     32,439,433        44,371,091
                                                         ---------------------------------------------
Expenses:
  Leasehold rentals                                                --             --           409,095
  Real estate taxes                                           547,845      4,633,769         7,149,045
  Interest (Notes 4 and 5)                                     43,584      1,676,492         3,842,192
  Management fees (Note 6)                                    109,737        517,005         1,121,955
  Payroll and related expenses                                431,153      1,898,115         4,220,947
  Repairs and maintenance expenses                            239,056      1,783,373         3,139,757
  Other property expenses                                     825,410      3,914,440         8,463,862
  Administrative expenses                                     636,900        592,736           309,626
  Co-owners' share of expense                                      --             --            25,027
  Depreciation and amortization of real estate                598,174      1,974,245         2,781,850
  Amortization of leasing commissions                         232,160        831,865         1,100,072
  Amortization of mortgage refinancing costs                       --          1,593            24,323
                                                         ---------------------------------------------
                                                            3,664,019     17,823,633        32,587,751
                                                         ---------------------------------------------
Income before items shown below                             3,479,993     14,615,800        11,783,340

Gain on sales of real estate (Note 3)                     150,500,239    136,434,754       101,295,596
                                                         ---------------------------------------------
Income before guaranteed payments required
   under the Limited Partnership agreement               $153,980,232   $151,050,554      $113,078,936
</TABLE>

                            See accompanying notes.


                                      S-4
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                        Statements of Income (continued)

<TABLE>
<CAPTION>

                                                                     Year ended December 31,
                                                            2000             1999              1998
                                                       -----------------------------------------------
<S>                                                      <C>              <C>               <C>
Guaranteed payments required under the
   Limited Partnership agreement (Note 7):
     To the Limited Partner                            $     15,000     $     15,000      $     15,000
     To General and Special Limited Partners                101,500          101,500           101,500
     To General Partners                                     34,054          154,222           214,703
                                                       -----------------------------------------------
                                                            150,554          270,722           331,203
                                                       -----------------------------------------------
Net income                                             $153,829,678     $150,779,832      $112,747,733
                                                       ===============================================
Net income allocable as follows (Notes 8 and 14):

   General Partners                                     $ 1,103,106     $    865,880      $    694,652

   Special Limited Partners                              99,179,316       77,850,455        62,455,572

   Limited Partner                                       53,547,256       72,063,497        49,597,509
                                                       -----------------------------------------------
                                                       $153,829,678     $150,779,832      $112,747,733
                                                       ===============================================
Net Income Per Limited Partner Participation
  Interest (820,000 units outstanding):                $    65.3015     $    87.8823      $    60.4848
                                                       ===============================================
</TABLE>

See accompanying notes.


                                      S-5
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

             Statements of Changes in Partners' Capital (Deficiency)

<TABLE>
<CAPTION>
                                                                                        Special
                                                                    General             Limited               Limited
                                                Total               Partners            Partners              Partner
                                             ---------------------------------------------------------------------------
<S>                                          <C>                   <C>                  <C>                  <C>
Partners' Capital (Deficiency)
   January 1, 1998                           $(37,970,893)         $(3,089,297)        $(50,128,009)        $ 15,246,413
Distribution to General Partners,
   Special Limited Partners and
   Limited Partner (Note 9)                   (68,055,027)            (374,303)         (33,653,211)         (34,027,513)
Net income for the year ended
   December 31, 1998 (Note 8)                 112,747,733              694,652           62,455,572           49,597,509
                                             ---------------------------------------------------------------------------
Partners' Capital (Deficiency)
   December 31, 1998                            6,721,813           (2,768,948)         (21,325,648)          30,816,409
Distribution to General Partners,
   Special Limited Partners
   and Limited Partner (Note 9)              (141,898,110)            (780,440)         (70,168,615)         (70,949,055)
Net income for the year ended
   December 31, 1999 (Note 8)                 150,779,832              865,880           77,850,455           72,063,497
                                             ---------------------------------------------------------------------------
Partners' Capital (Deficiency)
   December 31, 1999                           15,603,535           (2,683,508)         (13,643,808)          31,930,851
Distribution to General Partners,
   Special Limited Partners and
   Limited Partner (Note 9)                  (160,908,232)            (884,995)         (79,569,121)         (80,454,116)
Net income for the year ended
   December 31, 2000
   (Notes 8 and 14)                           153,829,678            1,103,106           99,179,316           53,547,256
                                             ---------------------------------------------------------------------------
Partners' Capital (Deficiency)
   December 31, 2000                         $  8,524,981          $(2,465,397)        $  5,966,387         $  5,023,991
                                             ===========================================================================
</TABLE>

See accompanying notes.


                                      S-6
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                            Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                 Year ended December 31,
                                                                    2000                   1999                 1998
                                                                ---------------------------------------------------------
<S>                                                              <C>                  <C>                  <C>
Operating activities:
Net income                                                       $ 153,829,678        $ 150,779,832        $ 112,747,733
Adjustments to reconcile net income to net cash
  provided  by  operating activities:
Depreciation and amortization                                          830,334            2,807,703            3,906,245
Deferred rent                                                               --           (1,082,359)          (1,045,707)
Gain on sale of real estate                                       (150,500,239)        (136,434,754)        (101,295,596)
Changes in operating assets and liabilities:
Due from managing agent                                              2,091,590             (446,415)             337,226
Receivables, net                                                       459,017              139,042              987,957
Deferred charges, net                                                  676,101             (121,133)          (3,077,192)
Accounts payable                                                      (564,809)            (476,892)          (1,055,285)
Accrued real estate tax                                                 11,088           (1,586,162)          (1,817,833)
Accrued interest                                                       (29,278)            (125,747)            (238,119)
Guaranteed payments due to General Partners
  Special Limited Partners and Limited Partner                        (120,168)            (400,107)             316,203
Accrued leasing commissions and management fees                       (189,293)             (60,292)            (480,943)
Sundry and accrued liabilities                                        (438,167)            (469,253)             232,297
Deposits and rents received in advance                              (1,696,853)            (162,447)            (122,489)
                                                                ---------------------------------------------------------
Net cash provided by operating activities                            4,359,001           12,361,016            9,394,497
                                                                ---------------------------------------------------------
Investing activities:
Property improvements                                                 (595,995)          (1,371,534)          (2,201,413)
Net proceeds from sale of real estate                              164,953,897          149,599,635          117,803,063
                                                                ---------------------------------------------------------
Net cash provided by investing activities                          164,357,902          148,228,101          115,601,650
                                                                ---------------------------------------------------------
Financing activities:
Distributions to General Partners, Special Limited
   Partners and Limited Partner                                   (234,972,567)         (74,802,647)         (82,405,306)
Principal payments on mortgages payable                             (4,000,000)         (19,847,488)         (13,000,000)
Principal payments on notes payable to related parties                      --                   --          (18,000,000)
                                                                ---------------------------------------------------------
Net cash used in financing activities                             (238,972,567)         (94,650,135)        (113,405,306)
                                                                ---------------------------------------------------------

(Decrease) increase in cash and cash equivalents                   (70,255,664)          65,938,982           11,590,841
Cash and cash equivalents at beginning of year                      79,770,013           13,831,031            2,240,190
                                                                ---------------------------------------------------------
Cash and cash equivalents at end of year                         $   9,514,349        $  79,770,013        $  13,831,031
                                                                =========================================================
Supplemental disclosure of cash flow information
Cash paid during the year for interest                           $      72,862        $   1,802,239        $   4,080,311
                                                                =========================================================
Supplemental disclosure of non-cash investing and
   financing activities:

   Deferred rent receivable charged to cost of sales             $          --        $   1,993,760        $          --
   Deferred leasing commissions charged to cost of sales             2,350,881            1,703,931                   --

</TABLE>

See accompanying notes.


                                      S-7
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                          Notes to Financial Statements

                           December 31, 2000 and 1999

1. Description of Business

Investment  Properties Associates ("IPA") was formed as a limited partnership on
May 15, 1969 to acquire and operate  commercial  properties.  Through January 4,
1997,  the General  Partners of IPA were Mr. Harry B.  Helmsley  and Mr.  Irving
Schneider and two corporations  owned or controlled by them.  Collectively,  the
General Partners owned a 1.5% interest in IPA. Upon the death of Mr. Helmsley on
January 4, 1997, the general  partnership  interest  owned by him  automatically
converted to a Special Limited  Partnership  Interest owned by his estate.  As a
result of this  conversion,  the total  interests of the General  Partners  were
reduced to .55%. The Special  Limited  Partners are Mrs. Leona M. Helmsley,  Mr.
Irving  Schneider,  and the  Estate of Mr.  Harry B.  Helmsley  and the  Limited
Partner is Mr. John Bailey.  Undivided  interests in the limited partnership are
represented by 820,000 Participation  Interests ("PPI's").  Changes in ownership
subsequent to January 4, 1997, are described below.

Under  the  terms of the  Partnership  Agreement  in  effect  on the date of Mr.
Helmsley's  death,  the General  Partners  were required to create a new limited
partnership  with  the  same  attributes  as  IPA  and  convey  all  assets  and
liabilities  of IPA to that  entity.  Because such a course of action would have
resulted  in  substantial  expense  to IPA and no benefit  to the  partners  and
holders of PPI's,  the General Partners  obtained  approval of a majority of the
holders  of the PPI's to  continue  the  business  of IPA,  and the  Partnership
Agreement was amended to that effect effective May 30, 1997.

Effective July 3, 1997, the Partnership Agreement was further amended to admit a
newly formed  limited  liability  company  owned by Mrs.  Leona M. Helmsley as a
General  Partner of IPA.  This  entity was  allocated  a portion of the  general
partner interest owned by one of the corporate general partners.

On June 10, 1998, the General  Partner  interests of the corporation and limited
liability  company  owned by Mrs.  Leona M.  Helmsley,  and the Special  Limited
Partner  interests  owned by Mrs.  Leona M.  Helmsley and the Estate of Harry B.
Helmsley were acquired by ScogBell  Acquisition,  L.L.C.  ("ScogBell").  Also on
June 10, 1998,  ScogBell  acquired 282,377 PPI's from Mrs. Leona M. Helmsley and
28,550 PPI's in the over-the-counter market.


                                      S-8
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

2. Significant Accounting Policies

a.   The  preparation  of financial  statements  in conformity  with  accounting
     principals  generally accepted in the United States requires  management to
     make estimates and  assumptions  that affect the reported  amount of assets
     and liabilities and disclosure of contingent  assets and liabilities at the
     date of the financial  statements and the reported  amounts of revenues and
     expenses  during the  reporting  period.  Actual  results could differ from
     those estimates.

b.   Rental  revenue from tenant  leases is  recognized on a straight line basis
     over the terms of the associated leases.

c.   Depreciation of buildings and building  improvements is provided for by the
     straight-line  method  over  estimated  useful  lives  of 19  to 39  years.
     Leaseholds,  leasehold  improvements and tenants' alterations are amortized
     over the  terms of the  related  leases.  Amounts  applicable  to  tenants'
     alterations and the related  accumulated  amortization  are eliminated from
     the accounts at the time the related lease expires or, if the tenant should
     vacate the  premises  prior  thereto,  unamortized  assets  are  charged to
     operations in the year the premises are vacated.

d.   Costs in  connection  with mortgage  refinancings  are included in deferred
     charges and are being amortized over the terms of the related mortgages.

e.   Leasing commissions are amortized over the terms of the related leases.

f.   IPA's  employees  are covered  under  multi-employer  defined  contribution
     pension plans. All contributions are funded currently based upon negotiated
     union  contracts.   Information  from  the  plans'  administrators  is  not
     available to permit IPA to determine its share of unfunded vested benefits.
     During 2000, 1999 and 1998, IPA paid approximately  $93,000,  $273,000, and
     $562,000,  respectively,  for employees to union plans for pension, welfare
     and other benefits.

g.   For the purpose of determining cash  equivalents,  IPA considers all highly
     liquid investments with a maturity of three months or less, when purchased,
     to be cash equivalents.


                                      S-9
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

2. Significant Accounting Policies (continued)

     h.   Financial  Accounting  Standards  Board  ("FASB")  Statement  No. 107,
          "Disclosures About Fair Value of Financial Investments",  defines fair
          value of a financial  instrument as the amount at which the instrument
          could be exchanged in a current  transaction  between willing parties.
          The  methods  and  assumptions  used to  estimate  the  fair  value of
          financial instruments at December 31, 2000 and 1999 are as follows:

          (i)  The  carrying  value  of  cash  and  cash  equivalents,  accounts
               receivable, accounts payable and accrued liabilities and deposits
               and rents received in advance  approximate  fair value due to the
               short maturities of these items.

          (ii) The carrying value of mortgage  payable  approximates  fair value
               due to the short term maturity of the note.

     i.   Gains on sales of real estate are  recognized at closing in accordance
          with FASB Statement No. 66, "Accounting for Sales of Real Estate".

     j.   FASB Statement No. 121,  "Accounting  for the Impairment of Long-Lived
          Assets  and  for  Long-Lived  Assets  to  be  Disposed  Of,"  requires
          impairment  losses  to  be  recorded  on  long-lived  assets  used  in
          operations   when   indicators  of  impairment  are  present  and  the
          undiscounted  cash flow  estimates to be generated by those assets are
          less than the asset's carrying amount or on long-lived assets held for
          sale when the assets  carrying  amount is greater than the fair market
          value  less  costs of  disposal  for  those  assets on a  property  by
          property basis. IPA evaluates each of its properties for indicators of
          impairment by reference to the undiscounted cash flows to be generated
          from  the  operation  and sale of the  properties.  No  indicators  of
          impairment were present, and, accordingly no provisions for impairment
          have been recorded in any of the periods presented.

     k.   Basic  earnings  per share has been  calculated  by  dividing  the net
          income   allocated  to  the  Limited  Partner  by  the  820,000  PPI's
          outstanding.  As  IPA  has  no  potentially  dilutive  securities,  no
          presentation of diluted earnings per share is required.

     l.   Effective  January  1, 1998,  IPA  adopted  FASB  Statement  No.  131,
          Disclosures  about Segments of an Enterprise  and Related  Information
          ("Statement  131").  IPA is engaged in the  ownership and operation of
          commercial  office  properties  and has one  reportable  segment.  IPA
          evaluates real estate performance and allocates resources based on net


                                      S-10
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

2. Significant Accounting Policies (continued)

          operating  income.  The primary  sources of revenue are generated from
          tenant  base rents and  escalations  of  operating  expenses  and real
          estate  taxes.  Operating  expenses  primarily  consist of common area
          maintenance.   The  commercial   office  property  segment  meets  the
          quantitative threshold for determining reportable segments. IPA has no
          investment in foreign operations.

     m.   Certain  amounts in the 1999 and 1998 financial  statements  have been
          reclassified to conform to the 2000 presentation.

3. Real Estate

Real estate is summarized as follows:

    Classification                                  2000               1999
    -------------------------------------------------------------------------
    Land                                         $  502,032       $ 4,935,164
    Buildings and building improvements                  --        21,401,388
    Leaseholds and leasehold improvements         7,531,315         7,497,580
    Tenants' alterations                                 --         6,815,828
                                                 ----------------------------
                                                 $8,033,347       $40,649,960
                                                 ============================

On May 8,  2000,  IPA sold the 245 Fifth  Avenue and the 261 Fifth  Avenue,  New
York, New York, properties for $135,000,000. The sales proceeds were used to pay
closing costs of  approximately  $4,400,000 and a sales commission to one of the
general   partners  of  approximately   $5,110,000.   In  connection  with  this
transaction, IPA recognized a gain on the sale of approximately $113,570,000. In
addition,  distributions  of  $60,000,000  was paid to the General  Partners and
Special  Limited  Partners  in May 2000 and  $60,000,000  was paid to holders of
Participation Interest in June 2000.

On January 18, 2000,  IPA sold its 50% undivided  interest in the 1328 Broadway,
New York, New York,  property for  $43,500,000.  The sales proceeds were used to
repay IPA's 50% share of the $8,000,000  mortgage loan  encumbering its interest
in the  property,  pay closing  costs of  approximately  $1,400,000  and a sales
commission to one of the general partners of approximately $1,650,000.


                                      S-11
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

3. Real Estate (continued)

In  connection  with  this  transaction,  IPA  recognized  a  gain  on  sale  of
approximately $36,930,000. In addition, distributions of $18,500,000 was paid to
the  General   Partners  and  Special  Limited  Partners  in  January  2000  and
$18,500,000 was paid to the holders of Participation Interests in February 2000.

On December 16, 1999, IPA sold the 1440 Broadway property for $152,000,000.  The
sales  proceeds were used to repay mortgage debt of  approximately  $17,347,500,
sales  commissions  of  $3,800,000  paid to an  affiliate  of one of the General
Partners and other closing costs of approximately $5,047,000. In connection with
this transaction,  IPA recognized a gain on sale of approximately  $130,557,000.
In addition,  on December 16, 1999, IPA declared a special  distribution  to its
partners  of  approximately  $128,000,000  of which  64,000,000  was paid to the
General  Partners and Special Limited  Partners in December 1999 and $64,000,000
was paid to the holders of Participation Interests in January 2000.

On May 18, 1999, IPA sold the Midland Savings Building located in Midland, Texas
for a sales  price  of  $300,000.  In  connection  with  this  transaction,  IPA
recognized a gain of approximately $298,000.

On April 14, 1999, IPA sold the Mojud Building  located in Long Island City, New
York for a sales price of $6,500,000.  The sales proceeds were used to pay sales
commissions of $162,500 to an affiliate of one of the General Partners and other
closing costs of approximately  $239,000.  In connection with this  transaction,
IPA recognized a gain of approximately $5,580,000.

On September  28, 1998,  IPA sold its five Chicago  commercial  properties  (the
"Chicago  Properties") for  $121,000,000.  The sales proceeds were used to repay
mortgage debt, loans from the General Partners, accrued distributions payable to
the  General  Partners  and  Special  Limited  Partners,  sales  commissions  of
$3,025,000 paid to an affiliate of one of the General Partners and other related
costs, aggregating  approximately  $64,000,000.  In addition, IPA made a special
distribution to its partners of  approximately  $57,000,000.  In connection with
this transaction, IPA recognized a gain on sale of approximately $100,683,900.

On January 22, 1998,  IPA sold to an unrelated  party its leasehold  interest as
ground  tenant  under  its lease  with the City of  Newark,  NJ on the  property
located at 1180 Raymond  Blvd.  As a  consequence  of the  transaction,  IPA was
relieved  of  liability  for  ground  lease  rent and real  estate  taxes on the
property  after  January 22, 1998.  In  connection  with this  transaction,  IPA
recognized a gain of approximately $611,700.


                                      S-12
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

4. Notes Payable to Related Parties

On November 30, 1994, affiliates of the General Partners loaned IPA $18,000,000,
evidenced by two promissory  notes (the "Notes") in the amount of $6,000,000 and
$12,000,000.  These notes were repaid in 1998 with the proceeds from the sale of
the Chicago properties.

The  affiliate  notes bore  interest at a variable rate based on the Chase prime
rate and were payable on demand.  Interest  expense for the year ended  December
31, 1998, with respect to the Notes was $1,160,124.

5. Mortgages Payable

As of December 31, 2000 and 1999, mortgages payable consist of the following:

                                                    Balance           Balance
                                                  Outstanding       Outstanding
                                                  December 31,     December 31,
Description                                           2000             1999
-------------------------------------------------------------------------------
Apple Bank for Savings (1):
Mortgage  loan  in  the  amount  of
  $8,000,000  with  fixed  interest
  payments collateralized  by 1328 Broadway
  Building N.Y.,  N.Y. (in which IPA has a
  50% tenancy in common interest)                 $    --        $4,000,000

Chase Manhattan Bank (2):
Mortgage loans with variable interest rates
  collateralized by:
  1440 Broadway, N.Y., N.Y.                       $    --        $       --
  261 Fifth Avenue, N.Y., N.Y.                         --                --
  245 Fifth Avenue, N.Y., N.Y.                         --                --
                                                  ------------------------------
Total                                             $    --        $4,000,000
                                                  ==============================

     (1)  The loan with Apple Bank for  Savings  ("Apple")  matured on April 24,
          1998.  The loan was extended to April 30, 1999, at an interest rate of
          8.5% per annum and was repaid on January 18,  2000 using the  proceeds
          from  the  sale of  IPA's  undivided  interest  in the  1328  Broadway
          property.


                                      S-13
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

5. Mortgages Payable (continued)

     (2)  IPA executed a Note Modification  Agreement (the "Agreement") on April
          25, 1996, with Chase Manhattan Bank ("Chase")  whereby  mortgage loans
          collateralized by five of IPA's properties; 1440 Broadway, NY, NY, 261
          Fifth Avenue,  NY, NY, 245 Fifth Avenue,  NY, NY, One North  Dearborn,
          Chicago, IL and One North LaSalle, Chicago, IL were generally modified
          to provide for: (a) an extension of the maturity date until January 2,
          1997, at which time all outstanding principal and interest was due and
          payable, (b) interest based on LIBOR plus 2.25% or Prime plus .375% at
          IPA's  option  subject  to  certain  limitations  as  defined  in  the
          Agreement,  (c) cross default and cross  collateralization  provisions
          for the five  properties,  (d) IPA's  guaranty  of  $6,000,000  of the
          outstanding   principal   balance,   and  (e)  principal  payments  of
          $3,000,000 during 1996.

On March 28, 1997, a first  modification  to the  Agreement was made between IPA
and Chase which  extended the maturity date of the loan to January 2, 1998,  and
provided for principal payments of $3,000,000 during 1997.

On March 23, 1998, a Second  Modification  to the Agreement was made between IPA
and Chase,  which extended the maturity date of the loan to January 2, 1999, and
provided for principal payments of $3,000,000 during 1998. In addition, upon the
sale of its Chicago  Properties in September,  1998,  IPA repaid  $16,847,488 of
principal to obtain a release for the Chicago Properties.

On January 2, 1999, a Third  Modification  to the Agreement was made between IPA
and Chase,  which extended the maturity date of the loan to January 2, 2000, and
provided for principal payments of $3,000,000 during 1999.  Scheduled  principal
repayments aggregating $2,500,000 were made through September 15, 1999, with the
entire remaining balance of the loan being repaid in December 1999 with proceeds
from the sale of the Mojud, Midland and 1440 Broadway properties.

6. Management of Properties

The  properties  are managed by  Helmsley-Spear,  Inc. Mr.  Irving  Schneider is
co-chairman and Chief Operating Officer of Helmsley-Spear, Inc., and owns 50% of
its outstanding  stock.  In addition to providing  general  property  management
services,  Helmsley-Spear,  Inc.  locates tenants and negotiates  leases for its
properties.  Management fees are based upon  negotiated  percentages of revenues
for each property in the portfolio.


                                      S-14
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

6. Management of Properties (continued)

Leasing  commissions are based upon varying  percentages of the annual rent paid
by  tenants  obtained  by  Helmsley-Spear,  Inc.  Management  fees  and  leasing
commissions  charged to IPA by Helmsley-Spear,  Inc. aggregated $393,447 (2000),
$1,287,902 (1999), and $1,969,571 (1998).

Tenants' security deposits for certain properties are held by the managing agent
principally in special bank accounts;  interest thereon accrues  principally for
the benefit of the tenants.

7. Guaranteed Payments Due to Partners

The Limited  Partnership  Agreement requires that certain guaranteed payments be
made to partners and deducted as expenses in determining net income. The General
Partners and Special  Limited  Partners  receive  guaranteed  payments  equal to
8-3/4% per annum of their "Remaining Original Cash Contribution"  ($1,160,000 at
December 31, 2000, 1999 and 1998).  In addition,  the General  Partners  receive
guaranteed payments equal to 1/2% of gross revenues, as defined, and the Limited
Partner receives $15,000 per annum.


                                      S-15
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

8. Allocations of Partnership Income

In accordance with the terms of the Limited Partnership  Agreement,  elements of
income for financial  reporting  purposes were credited (but not  distributed in
cash) to the  capital  accounts  of the  partners  through  January 3, 1997,  as
follows (see Note 9 for the basis on which cash distributions are determined):


                                             General  Special Limited   Limited
                                             ----------------------------------
A. Net income before items C, D, E
   and F below                                 1.5%         48.5%         50.0%
B. Net losses, before items below            100.0%         --            --
C. Depreciation and amortization
     of real estate:
       1.Equal to mortgage amortization
            (as defined)                       1.5%         48.5%         50.0%
       2.Balance                               3.0%         97.0%         --
D. Bond discount amortization                 --            --           100.0%
E. Gain on disposition of property:
       1.To the extent of the aggregate
           depreciation and amortization
           of such property included
           in C(2) above                       3.0%         97.0%         --
       2.Balance                               1.5%         48.5%         50.0%
F. Loss on disposition of property           100.0%         --            --


                                      S-16
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

8. Allocations of Partnership Income (continued)

Upon the death of Mr.  Helmsley on January 4, 1997,  and the  conversion  of his
General Partner interest into a Special Limited Partner  interest,  the elements
of income for  financial  reporting  purposes are  generally  credited  (but not
distributed in cash) to the capital accounts of the partners as follows:


                                             General  Special Limited   Limited
                                             ----------------------------------
A. Net income before items C, D, E
     and F below                                .55%        49.45%        50.0%
B. Net losses, before items below             36.67%        63.33%        --
C. Depreciation and amortization of
     real estate:
       1.Equal to mortgage amortization
           (as defined)                         .55%        49.45%        50.0%
       2.Balance                               1.1%         98.9%         --
D. Bond discount amortization                 --            --           100.0%
E. Gain on disposition of property:
       1.To the extent of the aggregate
           depreciation and amortization
           of such property included
           in C(2) above                       1.1%         98.9%         --
       2.Balance                                .55%        49.45%        50.0%
F. Loss on disposition of property            36.67%        63.33%        --

9. Cash Distributions

Net Operating Revenues,  as defined,  are distributable at the discretion of the
General Partners, as follows:

                                        Through                 From
                                    January 3, 1997        January 4, 1997
                                    --------------------------------------
         General Partners                1.5%                   .55%
         Special Limited Partners       48.5%                 49.45%
         Limited Partner                50.0%                 50.0%

Notwithstanding the foregoing,  if with respect to any calendar year the Limited
Partner's  distributive  share  (computed  on the  same  basis  as that  used in
preparing  IPA's  Federal  income tax return) of income  (loss) plus one-half of
such partner's  distributive  share of long-term  capital gains exceeds the cash
distributions  referred to above, IPA must distribute an additional amount equal
to such excess to the Holders of the Participation Interests.


                                      S-17
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

9. Cash Distributions (continued)

In 2000,  1999 and 1998,  Net  Operating  Revenues,  as defined  in the  Limited
Partnership  Agreement,  amounted to  $3,908,231,  $12,606,987  and  $9,803,570,
respectively.  At  December  31,  2000,  1999 and  1998,  accrued  distributions
amounted to $3,915,446, $77,979,781 and $10,884,318,  respectively.

10. Income Taxes

IPA has  obtained a ruling from the  Internal  Revenue  Service that IPA will be
classified as a partnership for Federal income tax purposes, and has received an
opinion of tax counsel  that IPA, as a  partnership,  will not be subject to any
Federal income taxes,  and that each holder of  Participation  Interests will be
treated for Federal  income tax purposes as if he were a limited  partner of IPA
to the extent of his proportionate interest in the Limited Partnership Interest.
Each  partner  of IPA and each  holder of  Participation  Interests  at any time
during the taxable year of IPA must take into account his distributive  share of
all items of IPA's income,  gain, loss,  deduction or credit,  without regard to
whether such partner or holder of  Participation  Interests has received or will
receive any distributions from IPA.  Accordingly,  no provision for income taxes
has been made in the accompanying statements of income.

The amount of income for federal tax purposes  for the years ended  December 31,
2000,  1999,  and  1998,  was  $146,534,487,   $150,375,301,  and  $111,019,115,
respectively, as compared with the net income of $153,829,678, $150,779,832, and
$112,747,733,  respectively, shown in the statements of income. A reconciliation
of the differences between income as reflected in the accompanying statements of
income and the amount of income for federal tax purposes is as follows:



                                      S-18
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

10. Income Taxes (continued)

<TABLE>
<CAPTION>

                                                            December 31,
                                             2000               1999               1998
                                        ---------------------------------------------------
<S>                                     <C>                <C>                <C>
Net income per statements of income     $153,829,678       $150,779,832       $112,747,733
Depreciation and amortization                153,124            762,866             929,903
Gain on sale of property                  (7,414,167)            42,439          (1,233,105)
Loss on sale of property                          --                 --                  --
Loss on abandonment of property                   --                 --                  --
Deferred rental income                            --         (1,082,359)         (1,045,707)
Other, net                                   (34,148)          (127,477)           (379,709)
                                        ---------------------------------------------------
Income for federal tax purposes         $146,534,487       $150,375,301        $111,019,115
                                        ===================================================
</TABLE>

11. Gross Revenue From Real Estate

IPA earns rental income under leases principally with commercial tenants located
in its office  buildings.  Such leases  generally  provide for the tenant to pay
minimum  rentals  plus,  in certain  instances,  a portion of  increases in real
estate taxes,  operating  expenses and/or  increases in the consumer price index
based on lease escalation clauses. Office leases generally range from 5 years to
15 years and contain  various  renewal  options.  In addition,  IPA earns rental
income from retail stores.  Such leases  generally  provide for minimum  rentals
plus percentage rentals based on the store sales.  Retail store leases generally
range  from  1 to 5  years  and  contain  various  renewal  options.  All of the
aforementioned  leases are accounted for as operating leases.  Included in Gross
Revenues from Real Estate for the years ended 2000,  1999, and 1998, are $1,839,
$536,325, and $956,247, respectively,  representing revenue from escalations and
percentage  rentals.  For the year  ended  2000,  1999 and  1998,  approximately
$259,290,  $17,000,  and $1,400,  respectively,  was received in connection with
lease  cancellations  with former  tenants.  As of December 31, 2000, IPA has no
minimum  future rentals on  noncancelable  operating  leases as their  remaining
properties include two undeveloped  parcels of land in Texas and a vacant office
property at 570 Broad Street, Newark, NJ.


                                      S-19
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

12. Recently Issued Accounting Pronouncement

In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement
No. 133,  "Accounting for Derivative  Instruments and Hedging  Activities"  (the
"Statement").  In June 1999,  the FASB issued  Statement No. 137, which deferred
the  effective  date of  Statement  No. 133,  requiring it to be adopted for all
fiscal  quarters of all fiscal years  beginning after June 15, 2000. The Company
expects to adopt the Statement  effective  January 1, 2001.  The Statement  will
require IPA to recognize  all  derivatives  on the balance  sheet at fair value.
Derivatives  that are not hedges must be adjusted to fair value through  income.
If a derivative  is a hedge,  depending  on the nature of the hedge,  changes in
fair value of the  derivative  will either be offset  against the change in fair
value of the hedged asset,  liability,  or firm commitment through earnings,  or
recognized in other comprehensive  income until the hedged item is recognized in
earnings. The ineffective portion of a derivative's change in fair value will be
immediately recognized in earnings. IPA does not anticipate that the adoption of
this  Statement  will have a significant  effect on its results of operations or
financial position.

13. Contingencies

IPA is involved in various  legal  matters  and  disputes  arising in the normal
course of  operations,  the ultimate  outcome of which is not expected to have a
material effect on the financial statements.


                                      S-20
<PAGE>

                        Investment Properties Associates
                        (A New York Limited Partnership)

                    Notes to Financial Statements (continued)

14. Summary of Quarterly Financial Information (Unaudited)

The separate  results of operations of IPA for the years ended December 31, 2000
and 1999 are as follows:

<TABLE>
<CAPTION>
                                                                          2000
                                              ---------------------------------------------------------
                                                                   Three Months Ended
                                                March 31       June 30       September 30   December 31
                                              ---------------------------------------------------------
<S>                                            <C>            <C>               <C>            <C>
Gross revenue (expenses) from real estate     $ 4,057,422    $  1,797,052      $ (128,103) $    242,727
Net income (loss)                              39,557,263     115,100,658        (969,346)      141,103
Net income (loss) credited to the partners
   capital accounts (a):
General Partners                                  233,163         874,499          (5,331)          776
Special Limited Partners                       20,963,468      78,625,414        (479,342)       69,775
Limited Partner                                18,360,632      35,600,745        (484,673)       70,552
                                              ---------------------------------------------------------
                                              $39,557,263    $115,100,658      $ (969,346) $    141,103
                                              =========================================================
Net income (loss) per Limited Partner
   Participation Interest                         22.3910         43.4155         (0.5911)       0.0860
                                              =========================================================

                                                                          1999
                                              ---------------------------------------------------------
                                                                 Three Months Ended
                                                March 31       June 30       September 30   December 31
                                              ---------------------------------------------------------
Gross revenue from real estate                $ 7,894,118    $  7,849,392      $8,319,977  $  7,577,347
Net income                                      3,415,467       9,037,349       4,237,424   134,089,592
Net income credited to the partners
   capital accounts (a):
General Partners                                   51,232         135,560          23,306       655,782
Special Limited Partners                        1,656,501       4,383,115       2,095,406    69,715,433
Limited Partner                                 1,707,734       4,518,674       2,118,712    63,718,377
                                              ---------------------------------------------------------
                                              $ 3,415,467    $  9,037,349      $4,237,424  $134,089,592
                                              =========================================================
Net income per Limited Partner
   Participation Interest                          2.0826          5.5106          2.5838       77.7053
                                              =========================================================
</TABLE>

(a)   The  allocation  of  net  income  to the  partners'  capital  accounts  as
      previously  reported  for the quarter  ended June 30, 2000 differ from the
      amounts set forth above due to an adjustment  relating to the crediting of
      gain on sale of real estate among the classes of  partners.  The impact of
      such adjustment was to reallocate income in the amount of $18,213,584 from
      the capital  account of the Limited  Partner and credit such amount to the
      capital accounts of the General Partner and Special Limited  Partner.  The
      impact of such  adjustment  on each of the 820,000  outstanding  PPI's was
      ($22.2117). While the adjustment had the effect of reducing the net income
      credited to the Limited  Partner capital account and increasing the amount
      of net income credited to the capital accounts of the General Partners and
      Special Limited  Partners,  it had no impact on reported net income of IPA
      and no  impact on the  amount  of  entitlement  of the  General  Partners,
      Special  Limited  Partners or Limited  Partner to the  distribution of net
      proceeds from the sale of partnership property.



                                      S-21
<PAGE>

                        Investment Properties Associates

                        (A New York Limited Partnership)

             Schedule III - Real Estate and Accumulated Depreciation

                                December 31, 2000
<TABLE>
<CAPTION>

          Col. A                   Col. B               Col. C                  Col. D
------------------------------------------------------------------------------------------
                                                 Initial Cost of Company
                                                -------------------------   Improvements
                                                                             Capitalized
                                                            Buildings and    Subsequent to
         Description             Encumbrances     Land      Improvements     Acquisition
------------------------------------------------------------------------------------------
<S>                             <C>            <C>         <C>                <C>
Edgewood and Bellway Shopping
   Centers, Houston, Texas              --      447,893            --                --

570 Broad Street Building
   Newark, New Jersey                   --      502,032     5,937,404          1,593,911
------------------------------------------------------------------------------------------
Totals                          $       --     $949,925    $5,937,404         $1,593,911
==========================================================================================
</TABLE>

<TABLE>
<CAPTION>

             Col. E                      Col. F         Col. G           Col. H
------------------------------------------------------------------------------------------
           Gross Amount
 at Which Carried Close of Period                                   Life on which
----------------------------------                                  Depreciation in
                                                                     Latest Income
             Buildings                  Accumulated      Date of      Statements is
 Land     and Improvements   Total     Depreciation   Construction     Computed
------------------------------------------------------------------------------------------
<S>        <C>           <C>         <C>                 <C>             <C>
      --           --           --           --          1957            24.3

 502,032    7,531,315    8,033,347    5,880,040          1962            34.3
------------------------------------------------------------------------------------------
$502,032   $7,531,315   $8,033,347   $5,880,040
==========================================================================================
</TABLE>


                                      S-22
<PAGE>

                        Investment Properties Associates

                        (A New York Limited Partnership)

       Schedule III - Real Estate and Accumulated Depreciation (continued)

                                December 31, 2000

(a)  Amounts shown  represent 50% of amounts  applicable to a tenancy in common,
     in which IPA has an undivided one-half interest.

(b)  Reconciliation of "Real Estate and Accumulated Depreciation":

<TABLE>
<CAPTION>
                                                                     Year ended December 31,
                                                     ------------------------------------------------------
                                                         2000                 1999                1998
                                                     ------------------------------------------------------
<S>                                                   <C>                 <C>                  <C>
Investment in Real Estate
Balance at beginning of year                         $ 40,649,960        $ 68,589,793         $136,524,047
Sale of real estate                                   (33,212,608)        (29,311,368)         (67,998,324)
Abandonment of real estate
Improvements and additions                                595,995           1,371,535            2,201,413
Fully depreciated assets written off
  during the year                                              --                  --           (2,137,343)
                                                     ------------------------------------------------------
Balance at end of year                               $  8,033,347        $ 40,649,960         $ 68,589,793
                                                     ======================================================
Accumulated Depreciation
Balance at beginning of year                         $ 26,391,697        $ 44,261,629         $ 95,613,778
Depreciation charged to costs
  and expens                                              598,174           1,974,245            2,781,850
Less amounts applicable to sale
  of real estate                                      (21,109,831)        (19,844,177)         (51,996,656)
Less amounts applicable to fully depreciated
   assets written off during the year
                                                               --                  --           (2,137,343)
                                                     ------------------------------------------------------
Balance at end of year                               $  5,880,040        $ 26,391,697         $ 44,261,629
                                                     ======================================================
</TABLE>

The  aggregate  basis of real  estate  assets for  Federal  income tax  purposes
amounted to $7,898,039 (2000), $44,822,622 (1999), and $71,268,168 (1998).


                                      S-23