FORM 10-Q

                    SECURITIES AND EXCHANGE COMMISSION
                            Washington, DC  20549

             Quarterly Report Under Section 13 or 15(d) of the
                       Securities Exchange Act of 1934

                       For Quarter Ended March 31, 1997
                       Commission File Number:  0-13559

                                 LDP-III
  (Exact name of registrant as specified in its governing instruments)

         California                                 94-2911983
(State or other jurisdiction of                  (I.R.S. Employer
incorporation or organization)                 Identification Number)

                 P. O. Box 130, Carbondale, Colorado 81623
                  (Address of principal executive offices)

                             (970) 963-8007
           (Registrant's telephone number, including area code)

 Indicate by check mark whether the registrant (1) has filed all reports 
 required to be filed by Sections 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 [   ]

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PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

LDP-III
CONSOLIDATED BALANCE SHEET, MARCH 31, 1997 AND DECEMBER 31, 1996 
(Unaudited) (Dollars in thousands)
<CAPTION>

                                             March 31,      December 31,
                                               1997             1996
<S>                                          <C>              <C> 
INVESTMENTS IN REAL ESTATE:
Rental properties                            $10,524          $10,510
Accumulated depreciation                      (4,153)          (4,086)
Rental properties - net                        6,371            6,424

CASH AND CASH EQUIVALENTS 
 (including interest bearing deposits 
  of $95 in 1997 and $85 in 1996)                 95               85

OTHER ASSETS:
Short-term investment                            199              298
Accounts receivable                               19               17
Prepaid expenses and deposits                      4                4
Deferred organization costs, loan costs 
 and leasing commissions (net of accumulated 
 amortization of $483 in 1997 and $474 in 1996)  116              126
Total other assets                               338              445

TOTAL                                        $ 6,804          $ 6,954

LIABILITIES AND PARTNERS' EQUITY LIABILITIES:
Notes payable                                $ 6,879          $ 6,891
Accounts payable                                  36                0
Other liabilities                                 51              133
Total liabilities                              6,966            7,024

PARTNERS' EQUITY                                (162)             (70)

TOTAL                                        $ 6,804          $ 6,954

See Financial Notes.

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<TABLE>

LDP-III
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996 
(Unaudited) (In thousands except per share amounts)
<CAPTION>

                                               1997             1996
<S>                                           <C>              <C>
REVENUE:
Rental                                        $ 269            $ 346
Interest                                          6                5
Total revenue                                   275              351

EXPENSE:
Interest                                        151              170
Operating                                        93              119
Depreciation and amortization                    78              114
General and administrative                       45               40
Total expense                                   367              443

NET INCOME (LOSS)                             $ (92)          $  (92)

NET INCOME (LOSS) PER PARTNERSHIP UNIT
       Limited Partners                          (2)              (2)
       General Partners                           0                0

                                                 (2)              (2)
See Financial Notes.

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<TABLE>

LDP-III
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 
THE YEAR ENDED DECEMBER 31, 1996 
(Unaudited) (Dollars in thousands)
<CAPTION>
                       ..LIMITED PARTNERS..
                            NUMBER OF             GENERAL    TOTAL
                           PARTNERSHIP            PARTNER    PARTNERS'
                              UNITS     AMOUNT    AMOUNT     EQUITY     
<S>                          <C>        <C>       <C>        <C>
BALANCE, JANUARY 1, 1996     37,136     $ 679     $    0     $  679
Net loss - 1996                          (193)                 (193)
Distribution - 1996                      (556)                 (556)

BALANCE, DECEMBER 31, 1996   37,136       (70)         0        (70)
Net loss                                  (92)                  (92)

BALANCE, MARCH 31, 1997      37,136     $(162)    $    0     $ (162)

See Financial Notes.

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<TABLE>

LDP-III
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996 
(Unaudited) (In thousands)
<CAPTION>
                                                 1997             1996
<S>                                             <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                               $ (92)           $ (92)
Adjustments to reconcile net income (loss)
 to net cash used in operating activities:
Depreciation                                       67               96

Change in operating assets and liabilities:
Increase in accounts receivable                    (2)             (59)
Increase in prepaid expenses and deposits           0              (16)
Increase in accounts payable                       36                1
Decrease in other liabilities                     (82)              (3)
Net cash used in operating activities             (73)             (73)

CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease in short term investments                 99                0
Capital expenditures and construction             (14)               0
Decrease in deferred expenses                      10               13
Net cash provided by investing activities          95               13

CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable                         (12)             (14)
Net cash used in financing activities             (12)             (14)
Increase (decrease) in cash and cash equivalents   10              (74)
Cash and cash equivalents at beginning of period   85              410
Cash and cash equivalents at end of period      $  95            $ 336

See Financial Notes.

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LDP-III

FINANCIAL NOTES

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited consolidated financial statements should be 
read in conjunction with the Partnership's 1996 Annual Report.  These 
consolidated statements have been prepared in accordance with the 
instructions to the Securities and Exchange Commission Form 10-Q and do 
not include all of the information and footnotes required by generally 
accepted accounting principles for complete financial statements.

In the opinion of the general partner, all adjustments (consisting of 
normal recurring accruals) considered necessary for a fair presentation 
have been included.  The consolidated results of operations for the 
three months ended March 31, 1997 and 1996, are not necessarily 
indicative of the results that may be expected for the year ending 
December 31, 1997.

For purposes of the consolidated statement of cash flows, the 
Partnership considers all highly liquid investments with a maturity of 
three months or less from the date of purchase to be cash equivalents.  
The Partnership paid interest of $151,000 and $170,000 for the three 
months ended March 31, 1997 and 1996, respectively.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
         CONDITION AND RESULTS OF OPERATIONS

INTRODUCTION

LDP-III is a California limited partnership formed in August 1983.  The 
Partnership's business consists of a single segment -- equity 
investments in leveraged income-producing real estate.  

The Partnership's current portfolio consists of fee title ownership of 
two properties located in two geographic areas.  The Partnership's 
property investments are:  Jefferson Place Office Building, Boise, 
Idaho, and 1201 Cadillac Court Building, Milpitas, California.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 1997, the Partnership's consolidated cash balance 
totaled $95,000.  Cash not required for current operations is placed in 
federally insured financial instruments and money market funds which can 
be liquidated as needed.

The Partnership has invested $198,000 in short-term federally insured 
certificates of deposit which mature on a date in excess of 90 days or 3 
months from the date of purchase.  Due to this characteristic, these 
deposits are classified as "short-term investments" rather than as "cash 
and cash equivalents."

During the first quarter of 1997, the Partnership experienced a net 
increase in cash of $10,000.  Short-term investments decreased $99,000 
during the first quarter of 1997.  As of March 31, 1997, cash plus 
short-term investments totaled $294,000 versus a balance of $383,000 at 
December 31, 1996.

Management believes the cash flow from operations of the remaining two 
properties, Jefferson Place and 1201 Cadillac, will be sufficient to 
cover the operating costs of the Partnership.  The Partnership has 
successfully negotiated a new lease with the sole tenant at 1201 
Cadillac, which will significantly increase revenues for 1997.

Short term investments (cash reserve) of $198,000 should remain in tact 
for the balance of 1997.

The Partnership does not plan any cash distributions to its limited 
partners in 1997.  All sale and loan proceeds realized by the 
Partnership will be used primarily to make cash distributions.

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<TABLE>

RESULTS OF OPERATIONS

The following represents the operations of those properties held 
continuously during the first three months of 1997 and 1996:
<CAPTION>
                                            1997     1996     % Change
     <S>                                  <C>      <C>          <C>
     Rental Revenue                       $  268   $  262        + 2%
     Operating Expense                        93      110       - 15%
     Net Operating Income                    175      152       + 15%

     Interest Expense                        151      152          0%

</TABLE>

Overall, revenues increased for the three months ended March 31, 1997 
relative to the same period in 1996.  The increase in commercial 
properties was due to higher occupancy and normal increases in current 
lease amounts due.

The Jefferson Place Office Building is currently 94% occupied, while the 
1201 Cadillac Court Building is 100% occupied.

Property operating expenses decreased 15% for the three months ended 
March 31, 1997 relative to the same period in 1996.

The Partnership general and administrative expense increased $5,000 in 
1997 relative to the same period in 1996.  The General Partner continues 
to exercise general and administrative expense control.

INFLATION

The Partnership's rental revenues in certain overbuilt real estate 
markets, including Boise and the San Francisco Bay Area, have not 
followed the overall inflationary trends of the economy.  In the future, 
the General Partner believes market rate rents in those areas will more 
closely follow or exceed inflation.  Operating costs for properties in 
most of the Partnership's markets have continued to follow inflationary 
trends.  It is not expected that the Partnership will be materially 
impacted by inflationary forces in the near term.

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PART II.     OTHER INFORMATION

All items in Part II have been omitted since they are inapplicable or 
the answer is negative.


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SIGNATURES

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

                               LDP-III

Date: May 12, 1997             /s/ Gary K. Barr     
                               Gary K. Barr, President
                               Landsing Equities Corporation
                               Managing Partner of the General Partner
                               Landsing Partners-III