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 September 30, 1998
                       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 [   ]

<PAGE>
<TABLE>
PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

LDP-III
CONSOLIDATED BALANCE SHEET, SEPTEMBER 30, 1998 AND DECEMBER 31, 1997 
(Unaudited) (Dollars in thousands except Units)
<CAPTION>

                                          September 30,    December 31,
                                               1998           1997
<S>                                          <C>              <C> 
INVESTMENTS IN REAL ESTATE:
Rental properties (including property
  for sale)                                  $ 6,061          $ 5,985
Accumulated depreciation                      (2,969)          (2,817)
Rental properties - net                        3,092            3,168

CASH AND CASH EQUIVALENTS 
 (including interest bearing deposits 
  of $200 in 1998 and $1,947 in 1997)            204            2,008

OTHER ASSETS:
Accounts receivable                               12               37
Prepaid expenses and deposits                      4                1
Deferred organization costs, loan costs 
 and leasing commissions (net of accumulated 
 amortization of $384 in 1998 and $359 in 1997)   74               90
Total other assets                                90              128

TOTAL                                        $ 3,386          $ 5,304

LIABILITIES AND PARTNERS' EQUITY LIABILITIES:
Notes payable                                $ 2,407          $ 2,452
Accounts payable                                   0                0
Other liabilities                                 83              133
Total liabilities                              2,490            2,536

PARTNERS' EQUITY (Deficit)
    General Partners                               0                0
    Limited Partners                             896            2,768

TOTAL                                        $ 3,386          $ 5,304

Equity Units Authorized  - Limited Partners   37,156           37,156
                         - General Partners        0                0

Equity Units Outstanding - Limited Partners   37,136           37,136
                         - General Partners        0                0


The accompanying notes are an integral part of the financial statements.

</TABLE>
<PAGE>
<TABLE>

DP-III
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited) (In thousands except per share amounts)
<CAPTION>
                                   Three Months Ended  Nine Months Ended
                                      September 30       September 30
                                     1998    1997       1998      1997
<S>                                  <C>     <C>        <C>       <C>
REVENUE:
Rental                               $ 172   $ 368      $ 493     $ 925
Interest                                 2       5         35        14
Total revenue                          174     373        528       939

EXPENSE:
Interest                                56     124        168       426
Operating                               83      92        234       267
Depreciation and amortization           61      82        177       239
General and administrative              38      33        148       140
Total expense                          238     331        727     1,072

NET INCOME (LOSS) - Limited Partners $ (64)  $  42       (199)     (133) 
                  - General Partners     0       0          0         0

NET INCOME (LOSS) PER PARTNERSHIP UNIT
                  - Limited Partners    (2)      1         (5)       (4)
                  - General Partners     0       0          0         0

The accompanying notes are an integral part of the financial statements.

</TABLE>
<PAGE>
<TABLE>

LDP-III
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 
THE YEAR ENDED DECEMBER 31, 1997 
(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, 1997     37,136     $   (70)  $    0     $   (70)
Income - 1997                             2,838                2,838

BALANCE, DECEMBER 31, 1997   37,136       2,768        0       2,768
Net loss                                   (199)                (199)
Distribution                             (1,671)              (1,671)

BALANCE, SEPTEMBER 30, 1998  37,136    $    896   $    0     $   896 

The accompanying notes are an integral part of the financial statements.

</TABLE>
<PAGE>
<TABLE>

LDP-III
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 
(Unaudited) (In thousands)
<CAPTION>
                                                   1998           1997
<S>                                              <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                $ (199)        $ (133)
Adjustments to reconcile net income (loss)
 to net cash used in operating activities:
Depreciation                                        177            202

Change in operating assets and liabilities:
Increase in accounts receivable                      25             (7)
Increase in prepaid expenses and deposits            (3)            (3)
Increase in accounts payable                          0             30
Increase in other liabilities                        (2)            33
Net cash provided by (used in) operating activities  (2)           122

CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease in short term investments                    0             99
Capital expenditures and construction               (78)           (43)
(Increase )decrease in deferred expenses             (6)           (99)
Net cash used in investing activities               (84)           (43)

CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable                           (45)           (33)
Net (distributions) contributions                (1,672)             0
Net cash used in financing activities            (1,717)           (33)

Increase (decrease) in cash and cash equivalents (1,804)            46

Cash and cash equivalents at beginning 
  of period                                       2,008             85

Cash and cash equivalents at end of period       $  204         $  131

The accompanying notes are an integral part of the financial 
statements.

</TABLE>
<PAGE>

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 1997 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 
nine months ended September 30, 1998 and 1997, are not necessarily 
indicative of the results that may be expected for the year ending 
December 31, 1998.

Organization - LDP-III (the "Partnership") is a limited partnership
organized under the laws of the state of California for the purpose of
acquiring, operating, holding for investment, and ultimately selling 
income producing real estate.  Landsing Partners-III (the "General 
Partner") is a California General Partnership whose partners are 
Landsing Equities Corporation and Partners '84.  LDP-III was formed 
on August 30, 1983, and shall continue until December 31, 2033, 
unless sooner terminated.  The Partnership commenced operations on 
December 9, 1983, with the acquisition of the first property.

The Partnership owns one building located in Idaho, which is a 
commercial office building with numerous tenants.

Investment in Subsidiary - On December 3, 1992 the Partnership 
transferred two of its properties, the 533 Cabot Building and the 
391 Forbes Building to its wholly owned subsidiary, LDP-III Realty 
Service Corporation, which filed bankruptcy under Chapter 11 of the 
Federal Bankruptcy Code.  During 1993, the U.S. Bankruptcy case was 
dismissed and the 533 Cabot Building was disposed of.  In 1996, 
391 Forbes Building was sold and the subsidiary dissolved.  For 
financial reporting purposes the Partnership consolidated the 
operation of the subsidiary with that of the Partnership.  All 
significant intercompany transactions and balances have been 
eliminated.

Rental Properties - Rental properties are stated at the lower of 
cost or recoverable value.  Depreciation is computed by the straight-
line method over estimated useful lives ranging from five to forty 
years. Tenant improvements are amortized over the lives of the 
related tenant leases which range from one to ten years.  Major 
additions are capitalized at cost, while maintenance and repairs 
which do not improve or extend the life of the respective assets 
are expensed currently.  When assets are retired or otherwise 
disposed of, the costs and related accumulated depreciation are 
removed from the accounts, and any gain or loss on disposal is 
included in the results of operations.

Loan Costs and Leasing Commissions - Amounts paid to obtain loans are 
deferred and amortized over the lives of the related notes payable, 
which range from four to ten years.  Leasing commissions are amortized 
over the lives of the tenant leases which range from one to ten years.

<PAGE>

Cash and Cash Equivalents - The Partnership considers all highly 
liquid investments with a maturity of three months or less from the 
date of purchase to be cash equivalents.  

Short-Term Investments - The Partnership invests in short-term 
federally insured certificates of deposits which mature on a date in 
excess of three months from the date of purchase.  The cost of these 
investments approximates market value.

Income Taxes - No provision for Federal or state income taxes has 
been made in the financial statements because these taxes are the 
obligation of the partners.

Net Loss Per Partnership Unit - Net loss per Partnership unit is 
based on weighted average units outstanding after giving effect to 
net income (loss) allocated to the General Partner. 

Concentrations of Credit Risk - The Partnership's financial 
instruments that are exposed to concentrations of credit risk 
consist primarily of its cash and cash equivalents.  The 
Partnership's cash and cash equivalents are maintained in various 
accounts in FDIC insured institutions. This investment policy limits 
the Partnership's exposure to concentrations of credit risks.  

Use of Estimates - The preparation of financial statements in 
conformity with generally accepted accounting principles requires 
management to make estimates and assumptions that affect certain 
reported amounts and disclosures.  Accordingly, actual results 
could differ from those estimates.

Impairment of Long-Lived Assets - The Partnership adopted Statement 
of Financial Accounting Standards (SFAS) No. 121, "Accounting for the 
Impairment of Long-lived Assets and for Long-lived Assets to be 
Disposed Of" during 1996.  SFAS No. 121 requires that long-lived 
assets and certain identifiable intangibles to be held and used or 
disposed of by an entity and be reviewed for impairment whenever 
events or changes in circumstances indicate that the carrying amount 
of an asset may not be recoverable.  During 1997 and 1996, the 
Partnership determined that no impairment loss need be recognized 
for applicable assets of continuing operations.

Accounting Pronouncements - In June 1996, the Financial Accounting 
Standards Board issued Statement No. 125 Accounting for Transfers 
and Servicing of Financial Assets and Extinguishment of Liabilities.  
This Statement is effective for transactions occurring after 
December 31, 1996.  However, transactions such as securities 
lending, repurchase agreements, dollar rolls, and similar secured 
financing arrangements are not subject to the provisions of SFAS No. 
125 until January 1, 1998.  The standard provides that, following a 
transfer of financial assets, an entity is to recognize the financial 
and servicing assets it controls and the liabilities it has incurred, 
derecognize financial assets when control has been surrendered and 
derecognize liabilities when extinguished.  The adoption of SFAS No. 
125 had no impact on the Partnership's financial statements.  The 
impact of the delayed provisions is also not expected to be material.

<PAGE>

In June 1997, the FASB issued Statement No. 130 Reporting 
Comprehensive Income (SFAS No. 130) and Statement No. 131, 
Disclosures about Segments of an Enterprise and Related Information 
(SFAS No. 131)  Each of the new statements is effective for periods 
beginning after December 15, 1997, and requires that certain 
additional information be reported in the financial statements and 
related notes.  The Partnership will adopt these SFAS in 1998 but 
does not expect an impact on its 1998 financial statements.

Year 2000 - The Partnership is aware of the Year 2000 conversion 
issue.  It is Management's assertion that the current accounting 
system utilized by the Partnership has the capability to accommodate 
the Year 2000 issue.

Adequate Capital Resources - The General Partner believes that 
despite the fact the Partnership has continued to operate at a net 
loss before gain from the sale of properties, the Partnership has 
adequate capital resources to continue operations.  Operating results 
at Jefferson Place in Idaho, the only remaining property, indicate 
the property is operating at a positive cash flow position.  The 
California property, 1201 Cadillac, was sold for profit in December 
1997.  Proceeds of the sale increased cash reserves and allowed the 
Partnership to make a cash distribution to limited partners in March 
1998.

The General Partner believes that due to the disposition of certain 
properties and the stability of the remaining property in the 
portfolio, that operations will generate positive cash flow.  

In the event the Partnership must liquidate its assets, management 
believes the costs of the assets will be recovered and excess funds 
would be available after satisfaction of all liabilities.

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 one property.  The Partnership's property investment is:  
Jefferson Place Office Building, Boise.  Jefferson Place has been
placed on the market for sale.

LIQUIDITY AND CAPITAL RESOURCES

As of September 30, 1998, the Partnership's consolidated cash and cash 
equivalents balance totaled $204,000.  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 $99,000 in short-term federally insured 
certificates of deposit which mature on a date less than 90 days or 
3 months from the date of purchase.  Due to this characteristic, 
these deposits are classified as "cash equivalents."

During the nine months ended September 30, 1998, the Partnership 
experienced a net decrease in cash and cash equivalents of $1,804,000.  
As of September 30, 1998, cash and cash equivalents totaled $204,000 
versus a balance of $2,008,000 December 31, 1997.

Management believes the cash flow from operations of the remaining 
property, Jefferson Place, will be sufficient to cover the 
operating costs of the Partnership.  

In March, 1998, the Partnership paid a distribution of $45 per unit 
to unit holders of record on February 28, 1998.  

<PAGE>
<TABLE>

RESULTS OF OPERATIONS

The following represents the operations of the property held 
continuously during the first nine months of 1998 and 1997:
<CAPTION>
                                            1998     1997   % Change
     <S>                                  <C>      <C>        <C>
     Rental Revenue                       $  493   $  498      N/A
     Operating Expense                       146      142     + 3%
     Net Operating Income                    347      356     - 2%

     Interest Expense                        168      176     - 5%

</TABLE>

Overall, revenues decreased slightly for the nine months ended 
September 30, 1998 relative to the same period in 1997.  The decrease
was due to the loss of one tenant at Jefferson Place.  

The Jefferson Place Office Building is currently 96% occupied.  

Property operating expenses increased 3% for the nine months ended 
September 30, 1998 relative to the same period in 1997.

The Partnership general and administrative expense increased $8,000
in 1998 relative to the same period in 1997 due to marketing the 
property for sale.  

Jefferson Place is currently under contract to be sold.  There
is no guarantee that such sale will occur as the Seller has a 
financing contingency.  If the property does sell, under the terms
of the current sales contract, the Partnership will be dissolved.

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.

<PAGE>

PART II.     OTHER INFORMATION

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

<PAGE>

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: November 15, 1998      /s/ Gary K. Barr     
                             Gary K. Barr, President
                             Landsing Equities Corporation
                             Managing Partner of the General Partner
                             Landsing Partners-III