UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM 10-K

(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1998
                          -----------------
                                      OR

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from               to 
                               -------------    -------------            
Commission file number 0-13233
                       -------
                          BALCOR PENSION INVESTORS-V
            ------------------------------------------------------          
            (Exact name of registrant as specified in its charter)

           Illinois                                      36-3254673
-------------------------------                      ------------------- 
(State or other jurisdiction of                       (I.R.S. Employer
incorporation or organization)                       Identification No.)

2355 Waukegan Road
Bannockburn, Illinois                                       60015
----------------------------------------             -------------------   
(Address of principal executive offices)                  (Zip Code)   

Registrant's telephone number, including area code (847) 267-1600
                                                   --------------
Securities registered pursuant to Section 12(b) of the Act:  None
                                                             ----
Securities registered pursuant to Section 12(g) of the Act:

                         Limited Partnership Interests
                       -----------------------------
                               (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 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 ]
<PAGE>
                                    PART I

Item 1. Business
----------------

Balcor Pension Investors-V (the "Registrant") is a limited partnership formed
in 1983 under the laws of the State of Illinois. The Registrant raised
$219,652,500 from sales of Limited Partnership Interests. The Registrant has
retained cash reserves from the sale of its real estate investments for
contingencies which exist or may arise. The Registrant's operations currently
consist of interest income earned on short-term investments and the payment of
administrative expenses.

The Registrant originally funded thirty-five loans. A portion of the Mortgage
Reductions generated by loan repayments was reinvested in five additional loans
and a second funding on an existing loan. Ten properties were acquired through
foreclosure and two loans were reclassified as investments in joint ventures
with affiliates. The Registrant has since disposed of all of these investments.

The Partnership Agreement provides for the dissolution of the Registrant upon
the occurrence of certain events, including the disposition of all interests in
real estate. The Registrant sold its final real estate investment in June 1997.
The Registrant has retained a portion of the cash from the sale of its real
estate investments to satisfy obligations of the Registrant as well as
establish a reserve for contingencies. The timing of the termination of the
Registrant and final distribution of cash will depend upon the nature and
extent of liabilities and contingencies which exist or may arise. Such
contingencies may include legal and other fees and costs stemming from
litigation involving the Registrant including, but not limited to, the lawsuit
discussed in "Item 3. Legal Proceedings". Due to this litigation, the
Registrant will not be dissolved and reserves will be held by the Registrant
until the conclusion of all contingencies. There can be no assurances as to the
time frame for conclusion of these contingencies.

See "Management's Discussion and Analysis of Financial Condition and Results of
Operations - Liquidity and Capital Resources" for information regarding the
Registrant's Year 2000 readiness.

The Registrant no longer has an ownership interest in any real estate
investments. The General Partner is not aware of any material potential
liability relating to environmental issues or conditions affecting real estate
formerly owned by the Registrant.

The officers and employees of Balcor Mortgage Advisors-V, the General Partner
of the Registrant, and its affiliates perform services for the Registrant. The
Registrant currently has no employees engaged in its operations.

Item 2. Properties
------------------

As of December 31, 1998, the Registrant did not own any properties.
<PAGE>
In the opinion of the General Partner, the Registrant has obtained adequate
insurance coverage for property liability and property damage matters.

See Notes to Financial Statements for other information regarding former real  
property investments.

Item 3.  Legal Proceedings
--------------------------

Dee vs. Walton Street Capital Acquisition II, LLC
-------------------------------------------------

On June 14, 1996, a proposed class and derivative action complaint was filed,
Dee vs. Walton Street Capital Acquisition II, LLC (Circuit Court of Cook
County, Illinois, County Department, Chancery Division ("Chancery Court"), Case
No. 96 CH 06283) (the "Dee Case"), naming the General Partner and the general
partners (the "Balcor Defendants") of nine other limited partnerships sponsored
by The Balcor Company (together with the Registrant, the "Affiliated
Partnerships"), as well as the Affiliated Partnerships, as defendants.
Additional defendants were Insignia Management Group ("Insignia") and Walton
Street Capital Acquisition II, LLC ("Walton") and certain of their affiliates
and principals (collectively, the "Walton and Insignia Defendants"). The
complaint alleged, among other things, that the tender offers for the purchase
of limited partnership interests in the Affiliated Partnerships made by a joint
venture consisting of affiliates of Insignia and Walton were coercive and
unfair.  

On July 1, 1996, another proposed class action complaint was filed in the
Chancery Court, Anderson vs. Balcor Mortgage Advisors (Case No. 96 CH 06884)
(the "Anderson Case"). An amended complaint consolidating the Dee and Anderson
Cases (the "Dee/Anderson Case") was filed on July 25, 1996.  

The complaint seeks to assert class and derivative claims against the Walton
and Insignia Defendants and alleges that, in connection with the tender offers,
the Walton and Insignia Defendants misused the Balcor Defendants' and
Insignia's fiduciary positions and knowledge in breach of the Walton and
Insignia Defendants' fiduciary duty and in violation of the Illinois Securities
and Consumer Fraud Acts. The plaintiffs amended their complaint on October 8,
1996, adding additional claims. The plaintiffs requested certification as a
class and derivative action, unspecified compensatory damages and rescission of
the tender offers. Each of the defendants filed motions to dismiss the
complaint for failure to state a cause of action. On January 7, 1997, the
Chancery Court denied the plaintiffs' motion for leave to amend the complaint
and dismissed the matter for failure to state a cause of action, with
prejudice.

On February 3, 1997, the plaintiffs filed a Notice of Appeal of the Chancery
Court's order to the Appellate Court of Illinois. Oral arguments before the
Appellate Court were held on March 18, 1998. On November 12, 1998, the
Appellate Court issued an opinion affirming the Chancery Court's dismissal of
the case. On December 3, 1998, the plaintiffs filed a notice of intent to
appeal the Appellate Court's ruling to the Illinois Supreme Court. 
<PAGE>
The Balcor Defendants intend to vigorously contest this action. No class has
been certified as of this date. The Registrant believes it has meritorious
defenses to contest the claims. It is not determinable at this time how the
outcome of this action will impact the remaining cash reserves of the
Registrant.

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

No matters were submitted to a vote of the Limited Partners of the Registrant
during 1998.
<PAGE>
                                    PART II

Item 5. Market for the Registrant's Common Equity and Related Stockholder
-------------------------------------------------------------------------
Matters
-------

There has not been an established public market for Limited Partnership
Interests and it is not anticipated that one will develop. For information
regarding previous distributions, see "Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operations - Liquidity and
Capital Resources".

As of December 31, 1998, the number of record holders of Limited Partnership
Interests of the Registrant was 37,609.

Item 6. Selected Financial Data
-------------------------------
                                     Year ended December 31,                  
                    -----------------------------------------------------------
                       1998        1997        1996        1995        1994   
                    ----------  ----------  ----------  ----------  -----------
Total income         $142,656   $4,786,726  $9,139,235  $9,205,295   $8,776,074
Recovery of          
  losses on loans, 
  real estate and 
  accrued inter-
  est receivable         None    2,102,000   3,672,819   1,600,000         None
Provision for 
  losses on loans, 
  real estate and 
  accrued inter-
  est receivable         None         None   1,499,518   1,117,110         None
(Loss) income before 
  gains on sales of 
  assets             (271,551)   3,798,337  10,373,926  12,145,083   10,835,098
Net (loss) income    (271,551)   3,798,337  20,049,845  12,145,083   10,835,098
Net (loss) income per
  Limited Partner-
  ship Interest -
  Basic and Diluted     (0.62)        8.34       32.10       24.88        22.20
Total assets        2,420,935    4,073,673  82,215,052  99,679,564  117,976,309
Distributions per
  Limited Partner-
  ship Interest (A)      2.83       182.20(B)    82.15       64.50        23.65

(A)  These amounts include distributions of Original Capital of $167.20,
$54.28, $27.50 and $2.65 per Limited Partnership Interest for the years 1997,
1996, 1995 and 1994, respectively. 

(B) In addition to these amounts, a special distribution of $0.38 per Interest
was paid to class members including certain current investors in the
Partnership pursuant to the settlement of a class action lawsuit.
<PAGE>
Item 7. Management's Discussion and Analysis of Financial Condition and
-----------------------------------------------------------------------
Results of Operations
---------------------

Operations
----------

Summary of Operations
---------------------

Balcor Pension Investors-V (the "Partnership") had higher administrative
expenses than interest income earned on short-term investments which resulted
in a net loss during 1998. The Partnership recognized gains in connection with
four of the seven properties sold in 1996 which was the primary reason net
income decreased in 1997 as compared to 1996. The Partnership's properties and
loans generated income prior to sale or repayment in 1996 which contributed to
the decrease in net income during 1997. Further discussion of the Partnership's
operations is summarized below. 

1998 Compared to 1997
---------------------

Interest income on loan receivable ceased during 1997 due to the repayment of
the Meadow Run Apartments loan receivable in May 1997.

Due to higher average cash balances in 1997 as a result of the investment of
proceeds received in connection with the December 1996 and the 1997 property
sales and the May 1997 loan repayment prior to distribution to partners in
1997, interest income on short-term investments decreased during 1998 as
compared to 1997.

Provisions for losses on loans, real estate and accrued interest receivable
were charged to income when the General Partner believed an impairment had
occurred to the value of its properties or in a borrower's ability to repay a
loan or in the value of the collateral property. Determinations of fair value
were made periodically on the basis of performance under the terms of the loan
agreement, assessments of property operations and the property's estimated
sales price less closing costs. Determinations of fair value represented
estimations based on many variables which affect the value of real estate,
including economic and demographic conditions. See Note 3(d) of Notes to
Financial Statements for further information regarding the Partnership's
accounting policies related to the determination of the fair value of its loans
and real estate held for sale. The Partnership recognized a recovery of
$2,102,000 related to the Meadow Run Apartments loan in 1997. In addition, an
allowance of $2,711,056 related to the Harbor Bay office building was written-
off in connection with the sale of the property during 1997.

During 1997, participation in income of joint ventures-affiliates represented
the Partnership's share of the property operations and gain on sale from the
Whispering Hills Apartments. Due to the sale in 1997, participation in income
of joint ventures with affiliates ceased during 1997.
<PAGE>
The Partnership recognized other income of $342,000 during 1997 from insurance
proceeds received in connection with fire damage incurred at the Huntington
Meadows Apartments during February 1996. Additionally, the Partnership
recognized other income of $172,053 relating to a prior year's real estate tax
refund received in 1997 for the Harbor Bay office building, which was sold in
1997.

Income or loss from operations of real estate held for sale represents net
property operations generated by the properties the Partnership had acquired
through foreclosure. Due to the payment of expenses related to properties sold
during 1996, a loss from operations of real estate held for sale was incurred
during 1997. During 1998, the Partnership paid additional expenditures related
to the Harbor Bay office building, which was sold in 1997, and recognized a
loss from operations of real estate held for sale during 1998. 

In connection with the sale of the Harbor Bay office building in 1997, the
Partnership wrote-off the remaining unamortized leasing commissions related to
the property. As a result, amortization expense ceased during 1997.
 
During February 1997, the General Partner made a payment relating to the
settlement of certain litigation to original investors who previously sold
their Interests in the Partnership, which was accounted for as an
administrative expense. In addition, the Partnership incurred lower accounting
and professional fees, bank charges and postage costs during 1998. As a result,
administrative expenses decreased during 1998 as compared to 1997.

1997 Compared to 1996
---------------------

Net interest income on loans receivable decreased in 1997 as compared to 1996
due to the repayments of the Meadow Run Apartments loan receivable in May 1997
and the Seven Trails Apartments wrap-around loan receivable in April 1996, and
the sales of the Noland Fashion Square acquisition loan and The Glen Apartments
loan receivable in August and December 1996, respectively. 

The Partnership had higher average cash balances in 1996 as compared to 1997 as
a result of the proceeds received in connection with the 1996 property sales,
loan repayment and loan sales which were invested prior to being distributed to
Limited Partners in 1997. This resulted in a decrease in interest income on
short-term investments during 1997 as compared to 1996. 

The Partnership's loans generally bore interest at contractually-fixed interest
rates. Some loans also provided for additional interest in the form of
participations, which usually consisted of either a share in the capital
appreciation of the property collateralizing the Partnership's loan and/or a
share in the increase of the gross income of the property above a certain
level. Participation income totaling $40,146 was recognized during 1996 in
connection with The Glen Apartments and Meadow Run Apartments loan receivables.

The Whispering Hills Apartments loan was owned by a joint venture consisting of
the Partnership and an affiliate. The loan collateralized by Whispering Hills
Apartments was accounted for as real estate held for sale. The 45th West 45th
Street Office Building was owned by a joint venture consisting of the
<PAGE>
Partnership and affiliates. The joint venture that owned the Whispering Hills
Apartments loan sold the loan in June 1997 and recognized a gain of $1,793,261.
The Partnership's share was $1,130,640 which includes a recovery for losses of
$631,500. The joint venture that owned the 45th West 45th Street Office
Building sold the property in November 1996 and recognized a gain of $2,934,185
of which $637,892 was the Partnership's share. Primarily as a result of the
higher gain on sale recognized in 1997 in connection with the Whispering Hills
Apartments sale, the Partnership recognized higher participation in income of
joint ventures with affiliates during 1997 as compared to 1996.

The Partnership recognized a provision of $511,415 related to the Noland
Fashion Square acquisition loan and a provision of $988,103 related to its real
estate held for sale to provide for a change in the estimate of the fair value
of certain properties during 1996. The Partnership also recognized recoveries
in 1996 of $2,478,000 and $341,382 related to the Seven Trails Apartments loan
and the Glen Apartments loan, respectively, and $853,437 related to its real
estate held for sale.

The seven properties sold in 1996 and the Harbor Bay office building, which was
sold in January 1997, all generated income resulting in income from operations
of real estate held for sale in 1996. The Partnership recognized a loss from
operations of real estate held for sale in 1997 due to the payment of expenses
related to properties sold in 1996.

In connection with the sale of the Harbor Bay office building in January 1997,
the Partnership wrote-off the remaining unamortized leasing commissions related
to the property, which resulted in an increase in amortization expense during
1997 as compared to 1996. 

The Partnership incurred higher consulting, legal, postage and printing costs
in connection with a response to a tender offer in 1996. In addition, portfolio
management fees decreased in 1997 due to the 1996 property sales. As a result,
administrative expenses decreased during 1997 as compared to 1996.   

The Partnership recognized equity in loss from investment in acquisition loan
during 1996 in connection with the Noland Fashion Square acquisition loan,
which was sold in August 1996.

The Partnership recognized gains on sales of real estate of $9,675,919 in
connection with the sales of the Huntington Meadows, The Glades on Ulmerton and
the Villa Medici apartment complexes and the Union Tower office building in
1996.

Liquidity and Capital Resources
-------------------------------

The cash position of the Partnership decreased by approximately $1,621,000 as
of December 31, 1998 when compared to December 31, 1997 primarily due to a
distribution made to Partners in January 1998 from available Cash Flow
reserves. The Partnership used cash of approximately $239,000 in its operating
activities to pay administrative and property operating expenses relating to a
sold property, which were partially offset by interest income earned on
short-term investments. Cash of approximately $1,381,000 was used in financing
activities to pay a distribution to the Partners. 
<PAGE>
The Partnership Agreement provides for the dissolution of the Partnership upon
the occurrence of certain events, including the disposition of all interests in
real estate. The Partnership sold its final investment in June 1997. The
Partnership has retained a portion of the cash from the sale of its real estate
investments to satisfy obligations of the Partnership as well as establish a
reserve for contingencies. The timing of the termination of the Partnership and
final distribution of cash will depend upon the nature and extent of
liabilities and contingencies which exist or may arise. Such contingencies may
include legal and other fees and costs stemming from litigation involving the
Partnership including, but not limited to, the lawsuit discussed in "Item 3.
Legal Proceedings". Due to this litigation, the Partnership will not be
dissolved and reserves will be held by the Partnership until the conclusion of
all contingencies. There can be no assurances as to the time frame for
conclusion of these contingencies.

The Partnership made distributions totaling $2.83, $182.20 and $82.15 per
Interest in 1998, 1997 and 1996, respectively. See Statement of Partners'
Capital for additional information. Distributions were comprised of $2.83 of
Cash Flow in 1998, $15.00 of Cash Flow and $167.20 of Mortgage Reductions in
1997 and $27.87 of Cash Flow and $54.28 of Mortgage Reductions in 1996.  

Limited Partners have received cash distributions totaling $784.93 per $500
Interest. Of this amount, $427.95 has been Cash Flow from operations and
$356.98 represents a return of Original Capital. No additional distributions
are anticipated to be made prior to the termination of the Partnership.
However, after paying final partnership expenses, any remaining cash reserves
will be distributed. Amounts allocated to the Early Investment Incentive Fund
will also be distributed at that time. 

In February 1997, the Partnership discontinued the repurchase of Interests from
Limited Partners. As of December 31, 1998, there were 28,466 Interests and cash
of $5,222,246 in the Early Investment Incentive Fund. 

The Partnership sold all of its remaining real property investments and
distributed a majority of the proceeds from these sales to Limited Partners in
1996 and 1997. Since the Partnership no longer has any operating assets, the
number of computer systems and programs necessary to operate the Partnership
has been significantly reduced. The Partnership relies on third party vendors
to perform most of its functions and has implemented a plan to determine the
Year 2000 compliance status of these key vendors. The Partnership is within its
timeline for having these plans completed prior to the year 2000.

The Partnership's plan to determine the Year 2000 compliance status of its key
vendors involves the solicitation of information from these vendors through the
use of surveys, follow-up discussions and review of data where needed. The  
Partnership has sent out surveys to these vendors and received back a majority
of these surveys. While the Partnership cannot guarantee Year 2000 compliance
by its key vendors, and in many cases will be relying on statements from these
vendors without independent verification, preliminary surveys indicate that the
key vendors performing services for the Partnership are aware of the issues and
are working on a solution to achieve compliance before the year 2000. The
<PAGE>
Partnership is in the process of developing a contingency plan in the event any
of its key vendors are not Year 2000 compliant prior to the year 2000. As part
of its contingency plan, the Partnership will identify replacement vendors in
the event that current vendors are not substantially Year 2000 compliant by
June 30, 1999. The Partnership does not believe that failure by any of its key
vendors to be Year 2000 compliant by the year 2000 would have a material effect
on the business, financial position or results of operations of the
Partnership.

Certain statements in this report constitute "forward looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. These
statements may include statements regarding income or losses as well as
assumptions relating to the foregoing.

The forward-looking statements made by the Partnership are subject to known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Partnership to differ from any
future results, performance or achievements expressed or implied by the
forward-looking statements. 

Item 7a. Quantitative and Qualitative Disclosures About Market Risk
-------------------------------------------------------------------

The supplemental financial information specified by Item 305 of Regulation S-K
is not applicable.

Item 8. Financial Statements and Supplementary Data
---------------------------------------------------

See Index to Financial Statements in this Form 10-K.

The supplemental financial information specified by Item 302 of Regulation S-K
is not applicable.

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

There have been no changes in or disagreements with accountants on any matters
of accounting principles, practices or financial statement disclosures.
<PAGE>
                                   PART III

Item 10. Directors and Executive Officers of the Registrant
-----------------------------------------------------------

(a) Neither the Registrant nor Balcor Mortgage Advisors-V, its General Partner,
has a Board of Directors.

(b, c & e) The names, ages and business experience of the executive officers
and significant employees of the General Partner of the Registrant are as
follows:

           TITLE                                  OFFICERS

Chairman, President and Chief                  Thomas E. Meador
   Executive Officer
Senior Vice President                          Alexander J. Darragh
Senior Managing Director, Chief                Jayne A. Kosik
   Financial Officer, Treasurer
   and Assistant Secretary                           

Thomas E. Meador (age 51) joined Balcor in July 1979. He is Chairman,
President and Chief Executive Officer and has responsibility for all ongoing
day-to-day activities at Balcor. He is a member of the board of directors of
The Balcor Company. He is also a Senior Vice President of American Express
Company and is responsible for its real estate operations worldwide. Prior to
joining Balcor, Mr. Meador was employed at the Harris Trust and Savings Bank in
the commercial real estate division where he was involved in various lending
activities. Mr. Meador received his M.B.A. degree from the Indiana University
Graduate School of Business. 

Mr. Meador is on the Board of Directors of Grubb & Ellis Company, a publicly
traded commercial real estate firm. Mr. Meador was elected to the Board of
Grubb & Ellis Company in May 1998. Mr. Meador is also a director of AMLI
Commercial Properties Trust, a private real estate investment trust that owns
office and industrial buildings in the Chicago, Illinois area. Mr. Meador was
elected to the Board of AMLI Commercial Properties Trust in August 1998.

Alexander J. Darragh (age 44) joined Balcor in September 1988 and is
responsible for real estate advisory services for Balcor and American Express
Company. Mr. Darragh received masters' degrees in Urban Geography from Queen's
University and in Urban Planning from Northwestern University.

Jayne A. Kosik (age 41) joined Balcor in August 1982 and, as Chief Financial
Officer, is responsible for Balcor's financial, human resources and treasury
functions. Ms. Kosik is also a member of the board of directors of The Balcor
Company. From June 1989 until October 1996, Ms. Kosik had supervisory
responsibility for accounting functions relating to Balcor's public and private
partnerships. She is also Treasurer and a Senior Managing Director of The
Balcor Company. Ms. Kosik is a Certified Public Accountant.

(d) There is no family relationship between any of the foregoing officers.
<PAGE>
(f) None of the foregoing officers or employees are currently involved in any
material legal proceedings nor were any such proceedings terminated during the
fourth quarter of 1998.

Item 11. Executive Compensation
-------------------------------

The Registrant has not paid and does not propose to pay any remuneration to the
executive officers and directors of the General Partner. The executive officers
receive compensation from The Balcor Company (but not from the Registrant) for
services performed for various affiliated entities, which may include services
performed for the Registrant. However, the General Partner believes that any
such compensation attributable to services performed for the Registrant is
immaterial to the Registrant. See Note 11 of Notes to Financial Statements for
information relating to transactions with affiliates.

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

(a) No person owns of record or is known by the Registrant to own beneficially
more than 5% of the outstanding Limited Partnership Interests of the
Registrant.

(b) Balcor Mortgage Advisors-V (principally through the Early Investment
Incentive Fund) and its officers and partners own as a group the following
Limited Partnership Interests of the Registrant:

                                  Amount
                               Beneficially
         Title of Class           Owned        Percent of Class
         --------------      ----------------  ----------------
         Limited Partnership              
         Interests                28,476             6.5%

Relatives of the officers and affiliates of the partners of the General Partner
do not own any additional Interests.

In addition, Balcor LP Corp., an affiliate of the General Partner, holds title
to 362 Limited Partnership Interests in the Partnership due exclusively to
instances in which Limited Partners abandoned title to their Limited
Partnership Interests. Balcor LP Corp. is a nominee holder only of such
Interests and has disclaimed any economic or beneficial ownership in said
Interests. All distributions of cash payable with respect to such Interests
held by Balcor LP Corp. are returned to the Partnership for distribution to
other Limited Partners in accordance with the Partnership Agreement.

(c) The Registrant is not aware of any arrangements, the operation of which may
result in a change of control of the Registrant.

Item 13. Certain Relationships and Related Transactions
-------------------------------------------------------
<PAGE>
(a & b) See Note 4 of Notes to Financial Statements for information relating to
the Partnership Agreement and the allocation of distributions and profits and
losses.

See Note 11 of Notes to Financial Statements for information relating to
transactions with affiliates.

(c) No management person is indebted to the Registrant.

(d) The Registrant has no outstanding agreements with any promoters.
<PAGE>
                                    PART IV

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

(a)
(1 & 2) See Index to Financial Statements in this Form 10-K.

(3) Exhibits:

(3) The Amended and Restated Agreement of Limited Partnership and Amended and
Restated Certificate of Limited Partnership of Balcor Pension Investors-V
previously filed as Exhibit 3 and 4.1, respectively, to Amendment No. 1 dated
January 16, 1984 to the Registrant's Registration Statement on Form S-11
(Registration No. 2-87662) are incorporated herein by reference.

(4) Form of Confirmation regarding Interests in the Registrant set forth as
Exhibit 4.2 to the Registrant's Report on Form 10-Q for the quarter ended
June 30, 1992 is incorporated herein by reference.

(10) Material Contracts:

(i) Agreement to Purchase Loan Documents relating to the sale of the first
mortgage loan secured by the Whispering Hills Apartments, Overland Park, Kansas
previously filed as Exhibit (10)(g)(i) to the Registrant's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1997, is incorporated herein by
reference.

(ii) First Amendment to Agreement to Purchase Loan Documents related to the
sale of the first mortgage loan secured by the Whispering Hills Apartments,
Overland Park, Kansas previously filed as Exhibit (10)(g)(ii) to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 1997,
is incorporated herein by reference.

(27) Financial Data Schedule of the Registrant for 1998 is attached hereto.

(b) Reports on Form 8-K:  No reports were filed on Form 8-K during the quarter
ended December 31, 1998.

(c) Exhibits: See Item 14(a)(3) above.
<PAGE>
SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of l934, the Registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                         BALCOR PENSION INVESTORS-V


                         By: /s/ Jayne A. Kosik
                             -----------------------
                             Jayne A. Kosik
                             Senior Managing Director and Chief
                             Financial Officer (Principal Accounting
                             and Financial Officer) of Balcor Mortgage 
                             Advisors-V, the General Partner

Date: March 19, 1999             
      --------------

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

       Signature                     Title                       Date    
----------------------   --------------------------------------------------
                         President and Chief Executive
                         Officer (Principal Executive
                         Officer) of Balcor Mortgage
                         Advisors-V, the General Partner
/s/ Thomas E. Meador                                        March 19, 1999
--------------------                                        --------------
    Thomas E. Meador
                         Senior Managing Director and Chief
                         Financial Officer (Principal 
                         Accounting and Financial
                         Officer) of Balcor Mortgage
                         Advisors-V, the General Partner
/s/ Jayne A. Kosik                                          March 19, 1999
--------------------                                        --------------
    Jayne A. Kosik
<PAGE>
                         INDEX TO FINANCIAL STATEMENTS

Report of Independent Accountants

Financial Statements:

Balance Sheets, December 31, 1998 and 1997

Statements of Partners' Capital, for the years ended December 31, 1998, 1997
and 1996

Statements of Income and Expenses, for the years ended December 31, 1998, 1997
and 1996

Statements of Cash Flows, for the years ended December 31, 1998, 1997 and 1996

Notes to Financial Statements

Financial Statement Schedules are omitted for the reason that they are
inapplicable or equivalent information has been included elsewhere herein.
<PAGE>
                       REPORT OF INDEPENDENT ACCOUNTANTS

To the Partners of
Balcor Pension Investors-V

In our opinion, the accompanying balance sheets and the related statements of
partners' capital, of income and expenses and of cash flows present fairly, in 
all material respects, the financial position of Balcor Pension Investors-V An
Illinois Limited Partnership (the "Partnership") at December 31, 1998 and 1997,
and the results of its operations and its cash flows for each of the three
years in the period ended December 31, 1998, in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Partnership's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with generally accepted
auditing standards which 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, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for the opinion expressed above.

As described in Note 2 to the financial statements, the partnership agreement
provides for the dissolution of the Partnership upon the disposition of all its
real estate interests. As of December 31, 1998, the Partnership no longer has
an ownership interest in any real estate investment. Upon resolution of the
litigation described in Note 15 to the financial statements, the Partnership
intends to cease operations and dissolve.

PricewaterhouseCoopers LLP

Chicago, Illinois
March 17, 1999
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                                BALANCE SHEETS
                          December 31, 1998 and 1997

                                    ASSETS


                                               1998             1997
                                          ---------------  ---------------
Cash and cash equivalents                 $    2,413,870   $    4,034,425
Accounts and accrued interest receivable           7,065           39,248
                                          ---------------  ---------------
                                          $    2,420,935   $    4,073,673
                                          ===============  ===============


                        LIABILITIES AND PARTNERS' CAPITAL 


Accounts payable                          $       35,254   $       43,862
Due to affiliates                                 71,108           62,317
                                          ---------------  ---------------
     Total liabilities                           106,362          106,179
                                          ---------------  ---------------
Commitments and contingencies

Limited Partners' capital
  (439,305 Interests issued
  and outstanding)                             2,329,708        3,844,492
General Partner's (deficit) capital              (15,135)         123,002
                                          ---------------  ---------------
     Total Partners' capital                   2,314,573        3,967,494
                                          ---------------  ---------------
                                          $    2,420,935   $    4,073,673
                                          ===============  ===============

The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                        STATEMENTS OF PARTNERS' CAPITAL
             for the years ended December 31, 1998, 1997 and 1996


                                    Partners' Capital (Deficit) Accounts
                                 ------------- ------------- -------------
                                                  General       Limited
                                     Total        Partner       Partners
                                 ------------- ------------- -------------
Balance at December 31, 1995     $ 98,258,638  $ (4,052,152) $102,310,790

Cash distributions (A)            (37,449,289)   (1,360,384)  (36,088,905)
Net income for the year
  ended December 31, 1996          20,049,845     5,949,464    14,100,381
                                 ------------- ------------- -------------
Balance at December 31, 1996       80,859,194       536,928    80,322,266

Cash distributions (A)            (80,873,080)     (732,174)  (80,140,906)
Cash contribution                     183,043       183,043
Net income for the year
  ended December 31, 1997           3,798,337       135,205     3,663,132
                                 ------------- ------------- -------------
Balance at December 31, 1997        3,967,494       123,002     3,844,492

Cash distributions (A)             (1,381,370)     (138,137)   (1,243,233)
Net loss for the year
  ended December 31, 1998            (271,551)                   (271,551)
                                 ------------- ------------- -------------
Balance at December 31, 1998     $  2,314,573  $    (15,135) $  2,329,708
                                 ============= ============= =============

(A)  Summary of cash distributions paid per Limited Partnership Interest:

                                     1998          1997          1996
                                 ------------- ------------- -------------

               First quarter     $       2.83  $ 126.00 (B)  $   5.00    
               Second quarter            None     32.95         14.78    
               Third quarter             None     14.10         41.72    
               Fourth quarter            None      9.15         20.65    

(B) In addition to this distribution, a special distribution of $0.38 per
Interest was paid to class members including certain current investors in
the Partnership pursuant to the settlement of a class action lawsuit.

The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                       STATEMENTS OF INCOME AND EXPENSES
             for the years ended December 31, 1998, 1997 and 1996


                                      1998          1997          1996
                                 ------------- ------------- -------------
Income:
  Interest on loans receivable,
    and from investment in
    acquisition loan                           $    236,661  $  3,575,255
  Less interest on loans
    payable - underlying
    mortgages                                                     185,693
                                               ------------- -------------
  Net interest income on 
    loans receivable                                236,661     3,389,562

  Interest on short-term
    investments                  $    142,656       642,720     1,141,900
  Participation income                                             40,146
  Recovery of losses on loans,
    real estate and accrued
    interest receivable                           2,102,000     3,672,819
  Participation in income 
    of joint ventures-affiliates                  1,291,292       894,808
  Other income                                      514,053
                                 ------------- ------------- -------------
    Total income                      142,656     4,786,726     9,139,235
                                 ------------- ------------- -------------
Expenses:
  Loss (income) from 
    operations of real estate
    held for sale                      16,603       168,214    (4,160,232)
  Provision for potential 
    losses on loans, real 
    estate and accrued 
    interest receivable                                         1,499,518
  Amortization of deferred
    expenses                                        196,549        55,455
  Administrative                      397,604       623,626     1,318,547
                                 ------------- ------------- -------------
    Total expenses                    414,207       988,389    (1,286,712)
                                 ------------- ------------- -------------

The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                       STATEMENTS OF INCOME AND EXPENSES
             for the years ended December 31, 1998, 1997 and 1996
                                  (Continued)


                                      1998          1997          1996
                                 ------------- ------------- -------------
(Loss) income before equity in
  loss from investment
  in acquisition loan            $   (271,551) $  3,798,337  $ 10,425,947

Equity in loss from investment 
  in acquisition loan                                             (52,021)
                                 ------------- ------------- -------------
(Loss) income before gains on
  sales of real estate               (271,551)    3,798,337    10,373,926

Gains on sales of real estate                                   9,675,919
                                 ------------- ------------- -------------
Net (loss) income                $   (271,551) $  3,798,337  $ 20,049,845
                                 ============= ============= =============
Net income allocated to
  General Partner                       None   $    135,205  $  5,949,464
                                 ============= ============= =============
Net (loss)income allocated to
  Limited Partners               $   (271,551) $  3,663,132  $ 14,100,381
                                 ============= ============= =============
Net (loss) income per Limited
  Partnership Interest
  (439,305 issued and
  outstanding) - Basic
  and Diluted                    $      (0.62) $       8.34  $      32.10
                                 ============= ============= =============

The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                           STATEMENTS OF CASH FLOWS
             for the years ended December 31, 1998, 1997 and 1996


                                       1998          1997          1996
                                 -------------  ------------  ------------
Operating activities:
  Net (loss) income              $   (271,551) $  3,798,337  $ 20,049,845
  Adjustments to reconcile net 
    (loss) income to net cash
    (used in) or provided by
    operating activities:
    Gains on sales
      of real estate                                           (9,675,919)
    Equity in loss from invest- 
      ment in acquisition loan                                     52,021
    Participation in income 
      of joint vebtures -
      affiliates                                 (1,291,292)     (894,808)
    Recovery of losses on loans,
      real estate and accrued
      interest receivable                        (2,102,000)   (3,672,819)
    Provision for potential 
      losses on loans, real 
      estate and accrued 
      interest receivable                                       1,499,518
    Amortization of deferred
      expenses                                      196,549        55,455
    Payment of leasing 
      commissions                                                (102,100)
    Collection of interest 
      income due at maturity                      2,115,968       452,768
    Net change in:
      Escrow deposits
       - restricted                                  95,243       (53,140)
      Accounts and accrued 
        interest receivable            32,183       626,447       (89,317)
      Prepaid expenses                               38,651       106,376
      Accounts and accrued
        interest payable               (8,608)     (934,248)      712,641
      Due to affiliates                 8,791       (88,263)      100,731
      Other liabilities                            (145,394)     (466,481)
      Security deposits                             (81,774)     (411,959)
                                 -------------  ------------  ------------
  Net cash (used in) or provided
    by operating activities          (239,185)    2,228,224     7,662,812
                                 -------------  ------------  ------------

The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                           STATEMENTS OF CASH FLOWS
             for the years ended December 31, 1998, 1997 and 1996
                                  (Continued)


                                       1998          1997          1996
                                 -------------  ------------  ------------
Investing activities:
  Proceeds from sale of 
    acquisition loan                                          $ 7,226,945
  Costs incurred in connection
    with the sale of 
    acquisition loan                                             (100,810)
  Procceeds from sale of loan
    receivable                                                  2,674,362
  Costs incurred in connection
    with sale of loan receivable                                 (107,806)
  Capital contributions to joint 
    ventures - affiliates                                         (22,759)
  Distributions from joint 
    ventures - affiliates                       $ 4,333,578     2,481,317
  Collection of principal 
    payments on loans receivable                  3,900,000    14,700,000
  Improvements to real estate                                    (628,831)
  Proceeds from sales
    of real estate                                6,900,000    55,506,000
  Costs incurred in 
    connection with the
    sales of real estate                           (293,276)   (1,924,522)
                                                ------------  ------------
  Net cash provided by
    investing activities                         14,840,302    79,803,896
                                                ------------  ------------
Financing activities:
  Distributions to Limited
    Partners                     $ (1,243,233)  (80,140,906)  (36,088,905)
  Distributions to General
    Partner                          (138,137)     (732,174)   (1,360,384)
  Contribution from General 
    Partner                                         183,043
  Principal payments on loans
     payable - underlying
     mortgages                                                    (41,745)
                                 -------------  ------------  ------------

The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                           STATEMENTS OF CASH FLOWS
             for the years ended December 31, 1998, 1997 and 1996
                                  (Continued)


                                      1998          1997          1996
                                 -------------  ------------  ------------
  Net cash used in financing
    activities                     (1,381,370)  (80,690,037)  (37,491,034)
                                 -------------  ------------  ------------
Net change in cash and 
    cash equivalents               (1,620,555)  (63,621,511)   49,975,674
Cash and cash equivalents at 
    beginning of period             4,034,425    67,655,936    17,680,262
                                 -------------  ------------  ------------
Cash and cash equivalents
  at end of period               $  2,413,870  $  4,034,425  $ 67,655,936
                                 ============= ============= =============

The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                         NOTES TO FINANCIAL STATEMENTS

1. Nature of Partnership's Business:

Balcor Pension Investors-V (the "Partnership") has retained cash reserves from
the sale of its real estate investments for contingencies which exist or may
arise. The Partnership's operations currently consist of interest income earned
on short-term investments and the payment of administrative expenses.

2. Partnership Termination:

The Partnership Agreement provides for the dissolution of the Partnership upon
the occurrence of certain events, including the disposition of all interests in
real estate. The Partnership sold its final investment in June 1997. The
Partnership has retained a portion of the cash from the sale of its real estate
investments to satisfy obligations of the Partnership as well as establish a
reserve for contingencies. The timing of the termination of the Partnership and
final distribution of cash will depend upon the nature and extent of
liabilities and contingencies which exist or may arise. Such contingencies may
include legal and other fees and costs stemming from litigation involving the
Partnership including, but not limited to, the lawsuit discussed in Note 15 of
Notes to Financial Statements. Due to this litigation, the Partnership will not
be dissolved and reserves will be held by the Partnership until the conclusion
of all contingencies. There can be no assurances as to the time frame for
conclusion of these contingencies.

3. Accounting Policies:

(a) The preparation of the financial statements in conformity with generally
accepted accounting principles requires the General Partner to make estimates
and assumptions that affect the reported amounts 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 vary from those estimates.

(b) The Partnership recorded wrap-around mortgage loans at the face amount of
the mortgage instruments which included the outstanding indebtedness of the
borrowers under the terms of the underlying mortgage obligations. The
underlying mortgage obligations were recorded as a reduction of the wrap-around
mortgage loans and the resulting balance represented the Partnership's net
advance to the borrowers. The Partnership was responsible for making periodic
payments to the underlying mortgage lenders only to the extent that payments as
required by the wrap-around mortgage agreements were received by the
Partnership from the borrowers.

(c) Income on loans was recorded as earned in accordance with the terms of the
related loan agreements. The accrual of interest was discontinued when a loan
became ninety days contractually delinquent or sooner when, in the opinion of
<PAGE>
the General Partner, an impairment had occurred in the value of the collateral
property securing the loan. Income on nonaccrual loans or loans which were
otherwise not performing in accordance with their terms was recorded on a cash
basis.

Various loan agreements provided for participation by the Partnership in
increases in value of the collateral property when the loan was repaid or
refinanced. In addition, certain loan agreements allowed the Partnership to
receive a percentage of rental income exceeding a base amount. Participation
income was reflected in the accompanying Statements of Income and Expenses when
received.

Income from operations of real estate held for sale is reflected in the
accompanying Statements of Income and Expenses net of related direct operating
expenses.

(d) Losses on loans receivable were charged to income and an allowance account
was established when the General Partner believed the loan balance would not be
recovered. The General Partner assessed the collectibility of each loan on a
periodic basis through a review of the collateral property's operations, the
property's value and the borrower's ability to repay the loan.  Upon
foreclosure, the loan net of the allowance was transferred to real estate held
for sale after the fair value of the property, less costs of disposal was
assessed. Upon the transfer to real estate held for sale, a new basis in the
property was established.

The Partnership recorded its investments in real estate at the lower of cost or
fair value, and periodically assessed, but not less than on an annual basis,
fair value of its real estate properties held for sale. The General Partner
estimated the fair value of its properties based on the current sales price
less estimated closing costs. Changes in the property's fair value were
recorded by an adjustment to the property allowance account and were recognized
in the income statement as an increase or decrease through recovery income or a
provision for loss in the period the change in fair value was determined. The
General Partner considered the methods referred to above to result in a
reasonable measurement of a property's fair value, unless other factors
affecting the property's value indicated otherwise.

(e) Investment in the acquisition loan represented a first mortgage loan which,
because the loan agreement included certain specified terms, was accounted for
as an investment in a real estate venture. Amounts which represented
contractually required debt service were recorded in the accompanying
statements of income and expenses as interest income and participation income.
Equity from investment in acquisition loan represented the Partnership's share
of the collateral properties' operations, including depreciation and interest
expense. The Partnership's share of operations had no effect on cash flow of
the Partnership.

(f) Investment in joint ventures-affiliates represented the Partnership's
interest in joint ventures which were recorded under the equity method of
accounting. Under the equity method of accounting, the Partnership recorded its
initial investment at cost and adjusted its investment account for additional
capital contributions, distributions and its share of joint venture income or
loss.
<PAGE>
(g) Deferred expenses consisted of loan application and processing fees and
mortgage brokerage fees which were amortized over the terms of the respective
agreements, and leasing commissions which were amortized over the life of each
respective lease. Upon sale, any unamortized balance was written off to
amortization expense.

(h)  Revenue is recognized on an accrual basis in accordance with generally
accepted accounting principles. Income from operating leases with significant
abatements and/or scheduled rent increases was recognized on a straight line
basis over the respective lease term. Service income included reimbursements
from operating costs such as real estate taxes, maintenance and insurance and
was recognized as revenue in the period the applicable costs were incurred.

(i) The Partnership calculates the fair value of its financial instruments
based on estimates using present value techniques. The Partnership includes
this additional information in the notes to the financial statements when the
fair value is different than the carrying value of those financial instruments.
When the fair value reasonably approximates the carrying value, no additional
disclosure is made.

(j) Cash and cash equivalents include all unrestricted, highly liquid
investments with an original maturity of three months or less. Cash or cash
equivalents are held or invested in one financial institution.

(k) The Partnership is not liable for Federal income taxes and each partner
recognizes his proportionate share of the Partnership income or loss in his tax
return; therefore, no provision for income taxes is made in the financial
statements of the Partnership.

(l) For financial statement purposes, prior to 1996, the partners were
allocated income and loss in accordance with the provisions in the Partnership
Agreement. In order for the capital account balances to more accurately reflect
the partners' remaining economic interests in the Partnership, the income
(loss) allocations have been adjusted. 

(m) Statement of Financial Accounting Standards, No. 128, "Earnings Per Share"
was adopted by the Partnership effective for the year-ended December 31, 1997
and has been applied to the prior earnings period presented in the financial
statements. Since the Partnership has no dilutive securities, there is no
difference between basic and diluted net income (loss) per Limited Partnership
Interest.

(n) Certain reclassifications of prior years information were made to conform
to the 1998 presentation.
 
4. Partnership Agreement:

The Partnership was organized in October 1983. The Partnership Agreement
provided for the admission of Limited Partners through the sale of Limited
Partnership Interests at $500 per Interest, 439,305 of which were sold on or
prior to August 31, 1984, the termination date of the offering.
<PAGE>
Pursuant to the Partnership Agreement, all income of the Partnership was
allocated 90% to the Limited Partners and 10% to the General Partner and all
losses were allocated 99% to the Limited Partners and 1% to the General
Partner. For financial statement purposes, prior to 1996, the partners were 
allocated income and loss in accordance with the provisions in the Partnership 
Agreement. In order for the capital account balances to more accurately 
reflect the partners' remaining economic interests in the Partnership, the 
income (loss) allocations have been adjusted. 

Mortgage Reductions were distributed entirely to Limited Partners. To the
extent that Cash Flow was generated, distributions were made as follows: (i)
90% of such Cash Flow was distributed to the Limited Partners, (ii) 7.5% of
such Cash Flow was distributed to the General Partner, and (iii) an additional
2.5% of such Cash Flow was distributed to the General Partner and constituted
the Early Investment Incentive Fund (the "Fund"). Amounts placed in the Fund
were, at the sole discretion of the General Partner and subject to certain
limitations as set forth in the Partnership Agreement, used to repurchase
Interests from existing Limited Partners. Distributions of Cash Flow and
Mortgage Reductions pertaining to such repurchased Interests were paid to the
Fund and were available to repurchase additional Interests. In February 1997,
the Partnership discontinued the repurchase of Interests from Limited Partners.
Upon the liquidation of the Partnership, the General Partner will return to the
Partnership for distribution to Early Investors an amount not to exceed the
2.5% share originally allocated. As of December 31, 1998, there were 28,466
Interests and cash of $5,222,246 in the Early Investment Incentive Fund. All
Limited Partners are Early Investors.

5. Investment in Loans Receivable:

(a) The Meadow Run Apartments $3,900,000 first mortgage loan matured in July
1996. The Partnership extended the loan until December 1996 to allow the
borrower additional time to secure alternate financing. The borrower was unable
to obtain alternate financing by December 1996 but continued to make monthly
interest payments through May 1997. The loan was repaid in May 1997 and the
Partnership received $6,015,968 including accrued interest of $2,115,968 which
was included in the loan balance. The Partnership recognized a recovery of
$2,102,000 upon repayment of the loan.
                                    
(b) The Seven Trails West Apartments loan matured in February 1996. The
Partnership extended the loan until April 1996 to allow the borrower additional
time to secure alternate financing. The loan was repaid in April 1996. The
Partnership recognized a recovery of $2,478,000 upon the repayment of the loan.
Nonaccrual loans and loans which have been restructured are referred to as
impaired loans. There were no impaired loans at December 31, 1996. The average
recorded investment in impaired loans during the year ended December 31, 1996
was approximately $7,576,384. 

6. Sale of Loan Receivable:

In December 1996, the Partnership sold The Glen Apartments which was a
wrap-around mortgage loan for a sale price of $2,674,362. Prior to the sale,
<PAGE>
the note receivable balance was $5,253,261 which included $303,261 of accrued
interest. The underlying mortgage loan was $2,498,088. From the proceeds of the
sale the Partnership paid $107,806 in selling costs. The carrying value of the
loan was $2,755,173.  The Partnership did not recognize a gain or loss in
connection with the sale of this loan.  During 1996, the Partnership recognized
a recovery of $341,382 and wrote off the previously established allowance for
losses of $530,000.   

7. Sale of Acquisition Loan Receivable:

The Partnership and two affiliates entered into a participation agreement to
fund a $23,300,000 first mortgage loan collateralized by the Noland Fashion
Square Shopping Center. The Partnership participated ratably in approximately
41% of the loan amount, interest income and participation income. The balance
of the loan included the Partnership's share of the cumulative net loss of the
property after the loan was funded.  The loan was sold in August 1996 in an all
cash sale for $17,725,000 of which $7,226,945 was the Partnership's share. From
the proceeds of the sale the Partnership paid $100,810 as its share of selling
costs.  The carrying value of the loan was $8,387,283. The Partnership did not
recognize a gain or loss in connection with the sale of this loan. During
1996, the Partnership recognized an additional provision for losses of $511,415
and wrote off $749,733 against the previously established loss allowance
related to this loan.

8. Allowances for Losses on Loans and Real Estate Held for Sale:

Activity recorded in the allowances for losses on loans and real estate held
for sale during the three years ended December 31, 1998 is described in the
table below:

                                1998        1997           1996
                             ---------  -----------   -----------
  Loans:
   Balance at beginning 
    of year                      None    $2,102,000   $5,859,733
   Provision charged to
    income                       None          None      511,415
   Recovery of provision
    previously charged
    to income                    None   (2,102,000)   (2,819,382)
   Direct write-off           
    of loans against
    allowance                    None          None   (1,449,766)
                             ---------  -----------    ----------
    Balance at the end of
     the year                    None          None   $2,102,000 
                             =========  ===========   ===========
<PAGE>
  Real Estate Held for Sale:
   Balance at beginning of
     year                        None   $2,711,056    $4,955,000 
   Provision charged to
     income                      None         None       988,103 
   Recovery of provision
    previously charged to
    income                       None         None      (853,437)
   Direct write-off           
    of real estate
    held for sale
    against allowance            None   (2,711,056)   (2,378,610)
                             ---------  -----------   -----------
   Balance at the end of   
     the year                    None         None    $2,711,056 
                             =========  ===========   ===========    

9. Management Agreement:

The Partnership's properties were managed by a third party management company
prior to the sale of the properties. These management agreements provided for
annual fees of 3% to 6% of gross operating receipts. 

10. Investment in Joint Ventures - Affiliates:

(a) The Partnership had classified the Whispering Hills Apartments first
mortgage loan investment as an investment in joint venture - affiliate.  This
investment represented a joint venture between the Partnership and an
affiliate. Profits and losses were allocated 25% to the Partnership and 75% to
the affiliate. During June 1997, the joint venture sold the loan for
$17,200,000. From the proceeds of the sale, the joint venture paid $750,000 to
the borrower in accordance with an amendment to the modified loan agreement and
$393,305 in selling costs. For financial statement purposes, the joint venture
recognized a gain of $1,793,261. The Partnership's share was $1,130,640 which
includes a recovery for losses of $631,500. This amount was included in the
Partnership's participation in income of joint ventures with affiliates. 

The following information has been summarized from the financial statements of
the joint venture for the year ended December 31, 1997:

   Total income                                            $1,237,046
   Net income before gain on sale                             642,612       
   Gain on sale                                             1,793,261
   Net income                                               2,435,873

(b) The Partnership and three affiliates (together, the "Participants"),
previously funded a $23,000,000 loan on the 45 West 45th Street Office
Building. In February 1995, the Participants received title to the property
through foreclosure, and the Partnership owned a 21.74% joint venture interest
in the property. In November 1996, the joint venture sold the property in an
all cash sale for $10,300,000. From the proceeds of the sale, the joint venture
paid $579,075 in selling costs. The basis of the property was $6,786,740. For
<PAGE>
financial statement purposes, the joint venture recognized a gain of
$2,934,185, of which $637,892 represented the Partnership's share. This amount
was included in the Partnership's participation in income of joint ventures
with affiliates. Pursuant to the sale agreement, $500,000 of the sale proceeds
was retained by the joint venture and was unavailable for distribution until
April 1997, at which time the funds were released in full. The Partnership's
share of the funds was $108,701.

During 1997 and 1996 the Partnership received distributions from these joint
ventures totaling $4,333,578 and $2,481,317, respectively, and made
contributions of $22,759 in 1996. 

11. Transactions with Affiliates:
Fees and expenses paid and payable by the Partnership to affiliates are:

                            Year Ended       Year Ended       Year Ended
                             12/31/98         12/31/97         12/31/96   
                          ---------------   --------------   --------------
                           Paid  Payable    Paid  Payable    Paid  Payable
                          ---------------   --------------   --------------
Mortgage servicing fees      None    None  $10,927    None  $54,285  $1,959
Reimbursement of expenses
  to the General Partner,
  at cost:
    Accounting            $30,029 $19,379   47,251 $18,395   27,291  23,720
    Data processing         2,328     872    3,665   1,456    4,600    None
    Legal                  14,115   9,415   20,946  18,383   15,436  13,416
    Portfolio management   63,020  41,442   97,936  24,083  107,448  93,390
    Other                    None    None   18,095    None   20,819  18,095

Prior to May 1995, the Partnership participated in an insurance deductible
program with other affiliated partnerships in which the program paid claims up
to the amount of the deductible under the master insurance policy for its
properties. The program was administered by an affiliate of the General Partner
(the Balcor Company) which received no fee for administering the program.
However, the General Partner was reimbursed for program expenses. The
Partnership paid premiums to the deductible insurance program relating to
claims for periods prior to May 1, 1995 of $17,633 for 1996.

The General Partner made a contribution to the Partnership in 1997 of $183,043
in connection with the settlement of certain litigation as further discussed in
Note 14 of Notes to Financial Statements.

12. Disposition of Properties Acquired Through Foreclosure:

(a) In January 1997, the Partnership sold the Harbor Bay office building in an
all cash sale for $6,900,000. From the proceeds of the sale, the Partnership
paid $293,276 in selling costs. The basis of the property was $9,317,780. For
financial statement purposes, the Partnership did not recognize a gain or loss
on the sale of this property.  The Partnership wrote off $2,711,056 against the
previously established allowance.
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(b) In December 1996, the Partnership sold The Glades on Ulmerton Apartments in
an all cash sale for $6,500,000. From the proceeds of the sale, the Partnership
paid $275,210 in selling costs. The basis of the property was $5,643,466. For
financial statement purposes the Partnership recognized a gain of $581,324 from
the sale of this property and a recovery of a previously established allowance
of $600,000. 

(c) In December 1996, the Partnership sold the Granada Apartments in an all
cash sale for $2,300,000. From the proceeds of the sale, the Partnership paid
$139,738 in selling costs. The basis of the property was $3,348,979. For
financial statement purposes the Partnership did not recognize a gain or loss
on the sale of this property. The Partnership recognized an additional
provision of $488,717 and wrote off $700,000 against the previously established
allowance.

(d) In December 1996, the Partnership sold the Plantation Apartments in an all
cash sale for $3,000,000. From the proceeds of the sale, the Partnership paid
$173,592 in selling costs. The basis of the property was $3,769,738. For
financial statement purposes the Partnership did not recognize a gain or loss
on the sale of this property. The Partnership recognized an additional
provision of $488,330 and wrote off $455,000 against the previously established
allowance.

(e) In December 1996, the Partnership sold the Huntington Meadows Apartments in
an all cash sale for $9,300,000. From the proceeds of the sale, the Partnership
paid $341,832 in selling costs. In addition, the purchaser received a $342,000
credit against the purchase price for certain repairs required at the property.
The basis of the property was $7,228,111. For financial statement purposes the
Partnership recognized a gain of $1,388,057 from the sale of this property. 

(f) In December 1996, the Partnership sold the Villa Medici Apartments in an
all cash sale for $12,808,000. From the proceeds of the sale, the Partnership
paid $362,595 in selling costs. The basis of the property was $9,487,780. For
financial statement purposes the Partnership recognized a gain of $2,957,625
from the sale of this property.

(g) In December 1996, the Partnership sold the Waldengreen Apartments in an all
cash sale for $6,590,000. From the proceeds of the sale, the Partnership paid
$270,325 in selling costs. The basis of the property was $6,566,238. For
financial statement purposes the Partnership did not recognize a gain or loss
on the sale of this property. The Partnership recognized a recovery of $253,437
and wrote off $500,000 against the previously established allowance.

(h) In December 1996, the Partnership sold the Union Tower office building in
an all cash sale for $15,350,000. From the proceeds of the sale, the
Partnership paid $361,230 in selling costs. The basis of the property was
$10,239,857. For financial statement purposes the Partnership recognized a gain
of $4,748,913 from the sale of this property.

13. Other Income:
The Partnership recognized other income during 1997 primarily from insurance
proceeds of $342,000 received in connection with fire damage incurred at the
Huntington Meadows Apartments during February 1996 and a prior year's real
estate tax refund of $172,053 for the Harbor Bay office building, which was
sold in 1997.
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14. Settlement of Litigation:

A settlement received final approval by the court in November 1996 in the class
action, Paul Williams and Beverly Kennedy, et al. vs. Balcor Pension
Investors-V, et al. upon the terms described in the notice to class members in
September 1996. The General Partner made a contribution of $183,043 to the
Partnership from which the plaintiffs' counsel received $18,304 pursuant to the
settlement agreement.  In February 1997, the General Partner made a settlement
payment of $164,739 ($0.38 per $500 Interest) to members of the class pursuant
to the settlement. Of the settlement amount, $99,534 was paid to original
investors who held their Limited Partnership Interests at the date of the
settlement and was recorded as a distribution to Limited Partners in the
Financial Statements. The remaining portion of the settlement of $65,205 was
paid to original investors who previously sold their Interests in the
Partnership. This amount was recorded as an administrative expense in the
Financial Statements. Similar contributions and payments were made on the seven
other partnerships included in the lawsuit in addition to those payments
described above. The Balcor Company paid an additional $635,000 to the
plaintiffs' class counsel and The Balcor Company received approximately
$946,000 from the eight partnerships as a reimbursement of its legal expenses,
of which $173,217 was the Partnership's share. The settlement had no material
impact on the Partnership.

15. Contingency:

The Partnership is currently involved in a lawsuit, Dee vs. Walton Street
Capital Acquisition II, LLC, whereby the Partnership, the General Partner and
certain third parties have been named as defendants seeking damages relating to
tender offers to purchase interests in the Partnership and nine affiliated
partnerships initiated by the third party defendants in 1996. The defendants
continue to vigorously contest this action. The action has been dismissed with
prejudice which dismissal was affirmed by the Illinois Appellate Court.
Plaintiffs have filed a further appeal to the Illinois Supreme Court. It is not
determinable at this time how the outcome of this action will impact the
remaining cash reserves of the Partnership. The Partnership believes that it
has meritorious defenses to contest the claims.
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