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, 1996
                          -----------------
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's
operations consist of investment in wrap-around mortgage loans and first
mortgage loans. The Registrant is also operating one property acquired through
foreclosure. All information included in this report relates to this industry
segment.

The Registrant originally funded thirty-four loans. A portion of mortgage
reductions generated by repayments was reinvested in five additional loans and
a second funding on an existing loan, and a portion was distributed to Limited
Partners. The remainder was added to working capital reserves. As a result of
the repayments, foreclosures and write-offs of thirty-four loans, the
Registrant has one loan in its portfolio as of December 31, 1996. Ten
properties were acquired through foreclosure and two loans were reclassified as
investment in joint ventures with affiliates. The Registrant sold seven of the
properties and one of the investments in joint ventures, and has one property
and one investment in joint ventures with affiliates in its portfolio as of
December 31, 1996. See "Item 2". Properties for additional information.

The Registrant's remaining investments face various levels of competition for
retention of tenants from similar types of properties in the vicinity in which
they are located. The Registrant has no plans to change the current use of or
to renovate its remaining investments.

Real estate values, especially for good quality, well located property,
increased significantly during 1996 due to a combination of readily available
capital, low interest rates, and decreased vacancy rates resulting from steady
demand and an acceptable level of new construction. While 1996 proved to be an
excellent year to sell real estate, projected yields by buyers on new
acquisitions have declined significantly due to competition and rising prices.
Although there will be variances by asset class and geographic area, the
investment climate is expected to remain strong for 1997. However, values could
begin to level off as they approach replacement cost triggering new
construction and an increase in capitalization rates.

The investment market for apartments was excellent during 1996 due to a number
of factors. Investor interest was strong, driven primarily by institutions, as
Real Estate Investment Trusts aggressively expanded their portfolios and
pension funds viewed apartments as an attractive asset class due to their
perceived low volatility and the emergence of large professional property
management companies.  Operationally, existing apartment properties registered
on a national basis occupancy in the mid 90's and rental rate increases of 3-4%
in 1996. While above the rate of inflation, the rate of rental growth in 1996
was below that of the previous two years suggesting that the apartment cycle
may have plateaued, especially as the impact of new construction in many areas
is being felt. While 1997 is projected to be another solid year, values should
begin to level off as capitalization rates move upward continuing a trend which
began during the second half of 1996.
<PAGE>
Currently, office properties are attracting the most interest from real estate
investors. While new apartment construction has been underway since 1995, the
office sector has just entered its development phase in most markets and new
construction is generally only proceeding with strong tenant pre-leasing.
Occupancy rates are at their highest level in years, reaching the 90s in a vast
number of markets. As a result, rents have finally begun to increase at rates
well in excess of inflation in many markets around the country. As a result of
these fundamentals, office properties have increasingly become in strong demand
by investors. Values increased significantly during 1996 and are expected to do
so again in 1997. Suburban properties are attracting attention as well. Still,
office properties remain a highly volatile sector where one new build-to-suit
office building for a major tenant could throw a market into relapse. In
addition, office space is highly vulnerable to corporate restructuring and the
growing "telecommuting" trend. The Registrant believes the combination of
strong price increases and future volatility make this an excellent time to
sell office assets.

During 1996 the Registrant sold the 45 West 45th Street Office Building in
which it held a minority joint venture interest, the Glades on Ulmerton,
Granada, Plantation, Huntington Meadows, Waldengreen and the Villa Medici
apartment complexes and the Union Tower office building.  The Registrant also
sold its remaining property, the Harbor Bay office building in January 1997.
The Registrant is actively marketing the property in which it holds a minority
joint venture interest for sale and seeking repayment of its remaining loan.
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
stemming from litigation involving the Registrant including, but not limited
to, the lawsuit discussed in "Item 3. Legal Proceedings".  In the absence of any
contingency, the reserves will be paid within twelve months of the last
property being sold.  In the event a contingency exists, reserves may be held
by the Registrant for a longer period of time.

The Registrant received notice of an unsolicited offer for the purchase of
Limited Partnership Interests ("tender offer") in March 1997.  The tender offer
was made by Madison Partnership Liquidity Investors XXI, LLC and stated that
their primary motive in making the offer is to make a profit from the purchase
of the interests.  Madison Partnership Liquidity Investors XXI, LLC is seeking
to acquire 4.9% of the total interests outstanding in the Registrant.  The
Registrant incurred administrative costs in responding to the tender offer and
may incur additional costs if additional tender offers are made in the future.
The General Partner cannot predict with any certainty what impact this tender
offer or any future tender offers will have on the operations or management of
the Registrant.  

During 1996, the Registrant received a repayment of the Seven Trails Apartments
loan receivable and sold the wrap-around mortgage loan relating to The Glen
Apartments and its interest in the Noland Fashion Square acquisition loan.  See
"Item 7. Liquidity and Capital Resources" for additional information.

During 1996, the Registrant sold seven properties in all cash sales totaling
$55,848,000. In addition, in 1996, the General Partner sold one property in
which the Registrant held a minority joint venture interest with affiliates in
an all cash sale for $10,300,000. During January 1997, the Registrant sold the
Harbor Bay Office Building for $6,900,000. See Item 7. "Liquidity and Capital
Resources" for additional information.
<PAGE>
The Registrant, by virtue of its ownership of real estate acquired through
foreclosure, is subject to Federal and state laws and regulations covering
various environmental issues. Management of the Registrant utilizes the
services of environmental consultants to assess a wide range of environmental
issues and to conduct tests for environmental contamination as appropriate. The
General Partner is not aware of any potential liability due to environmental
issues or conditions that would be material to 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.

Other Information
-----------------

The Glen Apartments
-------------------

In 1986, the Registrant funded a $2,130,233 loan collateralized by The Glen
Apartments, Fairfax County, Virginia and evidenced by a wrap-around mortgage
note in the principal amount of  $4,950,000 (the "Loan"). The principal amount
of the Loan included the principal amount of an underlying first mortgage loan
(the "Underlying Loan"). The Loan is payable in monthly interest only payments
through maturity in December 1997.

On December 23, 1996, the Registrant sold the Loan to Bank America Investment
Corporation, an Illinois corporation. The sale price was equal to 96.11% of the
total of the outstanding principal balance of the Loan and deferred interest
due under the terms of the Loan, less the outstanding principal balance of the
Underlying Loan at closing. The sale price was $2,674,362. Neither the General
Partner nor any affiliate will receive a brokerage commission in connection
with the sale of the property. The General Partner will be reimbursed by the
Registrant for actual expenses incurred in connection with the sale.

From the proceeds of the sale, the Registrant paid closing costs of $15,543 and
a total of $92,264 to two unaffiliated parties as a brokerage commission.  The
Partnership received the remaining proceeds of $2,566,555.

An affiliate of the Partnership simultaneously sold another loan to the
purchaser.

1420 Harbor Bay Parkway
-----------------------

As previously reported, in December 1996, the Registrant contracted to sell the
1420 Harbor Bay Parkway, Alameda, California, to an unaffiliated party, Lincoln
Property Company N.C., Inc., a Texas corporation. The purchaser assigned its
rights under the agreement of sale to one of its affiliates, Lincoln-DLJ Harbor
Bay Opco, LLC, and the sale closed on January 23, 1997. The sale price was
$6,900,000. From the proceeds of the sale, the Registrant paid a total of
$241,500 as a brokerage commission to two unaffiliated parties, one of which is
an affiliate of the third party providing property management services for the
property, and paid closing costs of $51,776. The Registrant received the
remaining proceeds of approximately $6,606,724.
<PAGE>
Item 2. Properties
------------------

As of December 31, 1996, the Registrant owned the property described below in
fee simple:

Location                     Description of Property
--------                     -----------------------

Alameda County, California * Harbor Bay: a two-story office building
containing approximately 120,000 square feet.

* This property was sold in January 1997.  See Note 17 of Notes to Financial
Statements for additional information.

The average occupancy rates and the effective average rent per square foot for
each of the last five years for the commercial property owned by the Registrant
at December 31, 1996, is described below.  

                                   1996      1995      1994     1993      1992
Harbor Bay Office Building
 Occupancy rate                    85%       88%       83%      58%       50%
 Effective rent                  $15.29    $18.71    $17.20   $18.52    $23.38

Information regarding tenants occupying 10% or more of the leasable square feet
of the above listed property is provided below.
                                                   Scheduled
                                                     Lease        Lease
                                Square  Base Rent  Expiration     Renewal
Property         Tenant          Feet   Per Annum     Date        Option
--------        --------       -------- ---------  ----------    ---------      
Harbor Bay    Thompkins & Co.
Office         (Insurance)      12,513   $170,400    10/2008        Yes
Building      Business Design   16,053   $240,795     4/1999        Yes
               Associates
               (Software)
              IDX Corporation   22,940   $324,830     3/2001        Yes
               (Consulting)

The Registrant also holds a minority joint venture interest in the Whispering
Hills Apartments located in Overland Park, Kansas. See Notes 3(g) and 11 of
Notes to Financial Statements for additional information.

Real estate taxes incurred in 1996 for the above commercial property was
$162,475.

The federal tax basis of the Registrant's property was $8,780,048 as of
December 31, 1996.  For Federal income tax purposes, the acquisition costs of
the property were depreciated over its useful life of 40 years, using the
straight-line method.

In the opinion of the General Partner, the Registrant has provided for adequate
insurance coverage for its real estate properties.
<PAGE>
See Notes to Financial Statements for other information regarding this
property.

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

Williams class action
---------------------

In February 1990, a proposed class-action complaint was filed, Paul Williams
and Beverly Kennedy, et al. vs. Balcor Pension Investors, et al., Case No.:
90-C-0726, U.S. District Court, Northern District of Illinois). The Registrant,
the General Partner, seven affiliated limited partnerships (together with the
Registrant, the "Related Partnerships") and other affiliates were the
defendants. The complaint alleged violations of Federal securities laws as to
the adequacy and accuracy of disclosure of information in the offering of
limited partnership interests in the Related Partnerships and alleged breach of
fiduciary duty, fraud, negligence and violations under the Racketeer Influenced
and Corrupt Organizations Act. The complaint sought compensatory and punitive
damages. 

A settlement of these proceedings was approved by the District Court on
November 20, 1996 on the terms previously described in the form of settlement
agreement attached as Exhibit 99 to the Registrant's Report on Form 10-Q for
the quarter ended June 30, 1996. Distributions to be paid pursuant to the
settlement were paid in February 1997. All proceedings relating to this matter
are now dismissed.

Proposed Class and Derivative Action Lawsuits
----------------------------------------------

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.
<PAGE>
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.  On January 7, 1997, the Chancery Court denied the plaintiffs'
motion for leave to amend the complaint and dismissed the matter 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.

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 whether or
not an unfavorable decision in this action would have a material adverse impact
on 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 1996.

                                    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, 1996, the number of record holders of Limited Partnership
Interests of the Registrant was 38,266.

Item 6. Selected Financial Data
-------------------------------
                                      Year ended December 31,                 
                    ----------------------------------------------------------
                       1996        1995        1994        1993        1992   
                    ----------  ----------  ----------  ----------  ----------

Total income       $13,299,467 $14,571,311 $12,182,999 $19,394,286  $13,794,232
<PAGE>
Recovery of          
  losses on loans, 
  real estate and 
  accrued inter-
  est receivable     3,672,819   1,600,000        None        None          None
Provision for 
  losses on loans, 
  real estate and 
  accrued inter-
  est receivable     1,499,518   1,117,110        None   6,755,000     4,000,000
Income before gains
  on sales of 
  assets            10,373,926 
Net income          20,049,845  12,145,083  10,835,098  10,335,746     7,982,124
Net income per
  Limited Partner-
  ship Interest          32.10       24.88       22.20       21.17         16.35
Total assets        82,215,052  99,679,564 117,976,309 120,700,542   144,257,526
Mortgage notes
  payable                 None        None        None   2,245,353     5,840,049
Distributions per
  Limited Partner-
  ship Interest (A)      82.15       64.50       23.65       65.25         32.50

(A)  These amounts include distributions of Original Capital of $54.28, 27.50,
$2.65, $23.25 and $2.50 per Limited Partnership Interest for the years 1996,
1995, 1994, 1993 and 1992, respectively.

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

Operations
----------

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

Net income increased during 1996 as compared to 1995 primarily due to gains
recognized on the sales of four properties owned by Balcor Pension Investors-V
(the "Partnership").  Net income increased in 1995 as compared to 1994
primarily as a result of improved operations at the Partnership's properties.
Further discussion of the Partnership's operations is summarized below. 

1996 Compared to 1995
---------------------

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,
the Villa Medici apartment complexes and the Union Tower office building in
1996.
<PAGE>
Net interest income on loans receivable decreased in 1996 as compared to 1995
due primarily to the 1995 repayments of the Club Wildwood, Four Seasons and
Point West mobile home parks and the Fairview Plaza I and II loans.
Additionally the Seven Trails loan receivable was repaid in 1996.

Income from operations of real estate held for sale represents net property
operations generated by the properties the Partnership has acquired through
foreclosure. At December 31, 1996, the Partnership was operating one property.
Original funds advanced by the Partnership were approximately $14,000,000 for
this property. Income from operations of real estate held for sale decreased in
1996 as compared to 1995 due to lower occupancy at the Harbor Bay Office
Building and increased tenant related expenditures at the Union Tower Office
Building.

Due to higher average cash balances in 1996 resulting from the property and
loan sales in 1996, interest on short-term investments increased during 1996 as
compared to 1995.

The Partnership's loans generally bear interest at contractually-fixed interest
rates. Some loans also provide for additional interest in the form of
participations, usually consisting 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 was recognized during 1995 in connection with the
prepayment of the Club Wildwood, Four Seasons and Point West mobile home parks
loans. Additionally, participation income was recognized on the Glen and Meadow
Run Apartments loans during 1996 and 1995.

Prepayment premiums totaling $315,000 were received in 1995 in connection with
the prepayments on the Club Wildwood, Four Seasons and Point West mobile home
park loans.

Participation in joint ventures with affiliates represents the Partnership's
share of the property operations at the Whispering Hills Apartments and the 45
West 45th Street Office Building. Primarily as a result of the recognition of a
gain in connection with the sale of the 45 West 45th Street Office Building in
1996 and a provision for losses related to a change in the estimate of the fair
value of the 45 West 45 Street Office Building in 1995, the Partnership
recognized participation in income of joint ventures with affiliates during
1996 as compared to participation in loss during 1995.

Provisions are charged to income when the General Partner believes an
impairment has 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 are made periodically on the basis of performance
under the terms of the loan agreement and assessments of property operations.
Determinations of fair value represent 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.
During 1996, the Partnership recognized a provision of $511,415 related to the
<PAGE>
Noland Fashion Square loan and provisions of $988,103 related to its real
estate held for sale to provide for changes in the estimate of the fair value
of certain properties in the Partnership's portfolio. The Partnership
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 Partnership recognized a
recovery of $1,600,000 and a provision of $817,110 in 1995 related to its real
estate held for sale and an additional provision of $300,000 related to the
Meadow Run loan. During 1995, allowances of $397,881 related to the Fairview I
and II loan receivable prepayment and $317,110 related to the Comerica Office
Building sale were written off.

As a result of the sale of the Comerica Office Building in 1995 and the
write-off of the unamortized deferred expenses, amortization expense decreased
during 1996 as compared to 1995.
 
The Partnership incurred higher legal, consulting, postage and printing costs
in connection with a response to a tender offer during 1996.  As a result,
administrative expenses increased during 1996 as compared to 1995. 

1995 Compared to 1994
---------------------

Interest income on loans receivable decreased in 1995 as compared to 1994 due
to the foreclosure of the Villa Medici Apartments in March 1995 and the final
interest income payments received on the Cinnamon Square Apartments loan in
1994.  This decrease was partially offset by the receipt of additional interest
income in connection with the Club Wildwood, Four Seasons and Pointe West
mobile home park loan prepayments during 1995. Interest expense on loans
payable decreased during 1995 as compared to 1994 due to the purchase of the
Seven Trails West Apartments underlying loan in March 1994. 

The Partnership had one non-accrual loan at December 31, 1995 which is
collateralized by Seven Trails West Apartments. For non-accrual loans, income
is recorded only as cash payments are received from the borrower. The funds
advanced by the Partnership for this loan were approximately $8,000,000,
representing approximately 4% of original funds advanced. During 1995 the
Partnership received cash payments of net interest income of approximately
$1,617,000. Under the terms of the original loan agreement the Partnership
would have received approximately $2,021,000 of net interest income during
1995.

Income from operations of real estate held for sale represents the net
operations of properties acquired by the Partnership through foreclosure. At
December 31, 1995, the Partnership was operating eight properties. Original
funds advanced by the Partnership totaled approximately $69,545,000 for these
properties. The Partnership foreclosed on the Villa Medici Apartments in March
1995. Additionally, occupancy rates at several of the Partnership's properties
increased while leasing costs decreased at the Harbor Bay Office Building in
1995. As a result, income from operations of real estate held for sale
increased in 1995 as compared to 1994. 

Due to higher Partnership cash balances and interest rates during 1995,
interest income on short-term investments increased in 1995 as compared to
1994.
<PAGE>
Participation in joint ventures with affiliates represents the Partnership's
share of the property operations at the Whispering Hills Apartments and the 45
West 45th Street Office Building. The Partnership recognized its share of the
decline in the fair value of the 45 West 45th Street Office Building during
1995 which was the primary reason the Partnership recognized participation in
loss of joint ventures during 1995 as compared to participation in income of
joint ventures in 1994.

The Partnership did not recognize any provisions during 1994 related to its
loans receivable or real estate held for sale. 

As a result of the sale of the Comerica Office Building and the full
amortization of the related deferred expenses, amortization expense increased
during 1995 as compared to 1994. 

Decreases in legal fees related to the 1994 foreclosures and mortgage servicing
fees resulted in a decrease in administrative expenses during 1995 as compared
to 1994.

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

The cash position of the Partnership increased by approximately $49,976,000 as
of December 31, 1996 when compared to December 31, 1995 primarily as a result
of the Partnership's share of the net proceeds received in connection with the
sale of seven properties and two loans and the repayment of one loan. The
Partnership's cash flow provided by operating activities of approximately
$7,663,000 was generated primarily by net interest income from the
Partnership's loans receivable, net interest income on short-term investments
and cash flow from the operation of the Partnership's properties held for sale
which was partially offset by the payment of administrative expenses. The
Partnership's investing activities generated cash flow of approximately
$79,804,000 primarily from the sale proceeds from the seven properties, the
Seven Trails Apartments loan repayment and the Noland Fashion Square
acquisition loan sale proceeds. Cash of approximately $37,491,000 was used in
financing activities consisting primarily of distributions to partners. In
addition, in January 1997 the Partnership received net proceeds of $6,606,724
from the sale of the Harbor Bay office building and made a special distribution
of $55,352,430 to Limited Partners.

The Partnership classifies the cash flow performance of its properties as
either positive, a marginal deficit or a significant deficit. A deficit is
considered to be significant if it exceeds $250,000 annually or 20% of the
property's rental and service income. The Partnership defines cash flow
generated from its properties as an amount equal to the property's revenue
receipts less property related expenditures. None of the properties have any
underlying debt. During 1996 and 1995 the Partnership's remaining property, the
Harbor Bay office building, generated positive cash flow. All of the properties
which were sold in 1996 generated positive cash flow prior to their sales in
1996 and in 1995. The property in which the Partnership holds a minority joint
venture interest with affiliate, the Whispering Hills Apartments, generated
positive cash flow during 1996 and 1995. The property in which the Partnership
held a joint venture interest with affiliates, the 45 West 45th Street Office
Building, generated positive cash flow prior to its sale in 1996 and in 1995.
<PAGE>
However, significant leasing costs were incurred at the 45 West 45th Street
Office Building in 1995.  These costs were not included in classifying the cash
flow performance of the property in 1995 since they were nonrecurring
expenditures.  Had these costs been included, the 45 West 45th Street Office
Building would have generated a significant cash flow deficit in 1995.  As of
December 31, 1996, the occupancy rate at the Harbor Bay Office Building was
84%. 

During November 1996, the General Partner sold the 45 West 45th Street Office
Building in which it held a minority joint venture interest.  During December
1996, the Partnership sold the Glades on Ulmerton, Granada, Plantation,
Huntington Meadows, Villa Medici, and the Waldengreen apartments complexes and
the Union Tower office building for sales prices of $6,500,000, $2,300,000,
$3,000,000, $9,300,000, $12,808,000, $6,590,000 and $15,350,000 respectively.
During January 1997 the Partnership sold the Harbor Bay office building.  The
Partnership is actively marketing the property in which it holds a minority
joint venture interest for sale and seeking repayment of its remaining loan.
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
stemming from litigation involving the Partnership including, but not limited
to, the lawsuit discussed in "Item 3. Legal Proceedings".  In the absence of
any contingency, the reserves will be paid within twelve months of the last
property being sold. In the event a contingency exists, reserves may be held by
the Partnership for a longer period of time.

The 45 West 45th Street Office Building was owned by a joint venture consisting
of the Partnership and three affiliates.  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 net proceeds
of the sale were $9,720,925, of which $2,113,329 was the Partnership's share.
Pursuant to the terms of the sale, $500,000 of the proceeds will be retained by
the joint venture until April 1997. The remaining proceeds were distributed to
the Limited Partners in January 1997. See Note 11 of Notes to Financial
Statements for additional information.
 
The Partnership funded a $14,700,000 loan collateralized by a wrap-around
mortgage on the Seven Trails Apartments. This loan wrapped around an underlying
first mortgage loan of $6,714,692, resulting in funds advanced by the
Partnership of $7,985,308. In March 1994, the underlying first mortgage loan
was purchased by the Partnership at face value for $4,689,871 which increased
the funds advanced to $12,675,179. The wrap-around mortgage loan matured in
February 1996. The Partnership extended the loan until April 1, 1996 to allow
the borrower additional time to secure alternate financing. The loan was repaid
in full in April 1996. The Partnership received proceeds of $16,473,402
consisting of funds advanced of $12,675,179, equity buildup related to
principal payments of $2,024,821 made by the Partnership on the underlying loan
and additional interest income of $1,773,402. The proceeds were distributed to
the Limited Partners in July 1996.  See Note 5 of Notes to Financial Statements
for additional information. 

The Meadow Run Apartments first mortgage loan matured in July 1996. The
Partnership negotiated an extension of the loan until December 1996 to allow
the borrower additional time to secure alternate financing.  The loan came due
in December 1996 and the borrower is currently pursuing alternate financing and
<PAGE>
continues to make monthly interest payments to the Partnership. See Note 5 of
Notes to Financial Statements for additional information.

In August 1996, the Noland Fashion Square acquisition loan, in which the
Partnership held a 40.77% participating interest, was sold.  The Partnership's
share of the sale price was $7,226,945.  From the proceeds of the sale, the
Partnership paid $100,810 as its share of selling costs.  Pursuant to the terms
of the sale, $101,932 of the proceeds were held in an escrow account until
November 1996 at which time the escrow was released to the Partnership.  The
proceeds were distributed as special distributions to the Limited Partners in
October 1996 and January 1997.  See Note 7 of Notes to Financial Statements for
additional information.

The Noland Fashion Square Shopping Center loan was recorded by the Partnership
as an investment in an acquisition loan. The Partnership has recorded its share
of the property's operations as equity in loss from investment in acquisition
loan. The Partnership's share of operations has no effect on the cash flow of
the Partnership. Amounts representing contractually required debt service are
recorded as interest income.  

In December 1996, the Partnership sold The Glen Apartments first mortgage loan
in an all cash sale for $2,674,362.  From the proceeds of the sale the
Partnership paid $107,806 in selling costs.  The net proceeds were distributed
to the Limited Partners in January 1997.  See Note 6 of Notes to Financial
Statements for additional information.

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 net proceeds were distributed as a special
distribution to the Limited Partners in January 1997.  See Note 14 of Notes to
Financial Statements for additional information.

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 net proceeds were distributed as a special
distribution to the Limited Partners in January 1997.  See Note 14 of Notes to
Financial Statements for additional information.

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 net proceeds were distributed as a special
distribution to the Limited Partners in January 1997.  See Note 14 of Notes to
Financial Statements for additional information.

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.
Pursuant to the terms of the sale, $200,000 of the proceeds were be retained by
the Partnership until February 1997.  The full amount of the holdback was
released in February 1997. The remainder of the proceeds were distributed as a
special distribution to the Limited Partners in January 1997.  See Note 14 of
Notes to Financial Statements for additional information.
<PAGE>
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 net proceeds were distributed as a special
distribution to the Limited Partners in January 1997.  See Note 14 of Notes to
Financial Statements for additional information.

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 net proceeds were distributed as a special
distribution to the Limited Partners in January 1997.  See Note 14 of Notes to
Financial Statements for additional information.

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 net proceeds were distributed as a special
distribution to the Limited Partners in January 1997.  See Note 14 of Notes to
Financial Statements for additional information.

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 net proceeds will be distributed to the Limited
Partners in 1997.  See Note 17 of Notes to Financial Statements for additional
information.
 
The Partnership made four distributions totaling $82.15, $64.50, and 23.65 per
Interest in 1996, 1995 and 1994, respectively.  See Statement of Partners'
Capital for additional information.  Distributions were comprised of $27.87 of
Cash Flow and $54.28 of Mortgage Reductions in 1996, $37.00 of Cash Flow and
$27.50 of Mortgage Reductions in 1995 and $21.00 of Cash Flow and $2.65 of
Mortgage Reductions in 1994.  Cash Flow distributions decreased in 1996 as
compared to 1995 and increased in 1995 as compared to 1994 primarily due to the
1995 loan repayments.  Distributions from Mortgage Reductions were made from
property sales and loan repayments. 

In January 1997, the Partnership paid a distribution of $55,352,430 ($126.00
per Interest) to the holders of Limited Partnership Interests representing the
regular quarterly distribution of Cash Flow of $5.00 per Interest for the
fourth quarter of 1996 and a special distribution of $121.00 per Interest
primarily from proceeds received from the seven property sales in 1996. The
level of the regular quarterly Cash Flow distribution was consistent with the
prior quarter. Including the January 1997 distribution, Limited Partners have
received cash distributions totaling $725.90 per $500 Interest. Of this amount,
$415.12 has been Cash Flow from operations and $310.78 represents a return of
Original Capital. In January 1997, the Partnership also paid $183,044 to the
General Partner as its distributive share of Cash Flow for the fourth quarter
of 1996 and made a contribution to the Early Investment Incentive Fund of
$61,015.

In February 1997, the General Partner made a settlement payment of
$164,739($.38 per Interest) to members of the class pursuant to the settlement
approved by the court in November 1996 in the Paul Williams and Beverly Kennedy
et. at. v. Balcor Pension Investors-V, et. al. class action lawsuit.
<PAGE>
During 1996 the General Partner used amounts placed in the Early Investment
Incentive Fund to repurchase 5,319 Interests from Limited Partners at a total
cost of $1,187,603.  In February 1997, the Partnership discontinued the
repurchase of Interests from Limited Partners.

Future distributions will be made from available proceeds from the sale of the
Partnership's remaining properties and the repayment of its remaining loan. The
General Partner, on behalf of the Partnership, has retained what it believes is
an appropriate amount of working capital to meet current cash or liquidity
requirements which may occur.

Changing interest rates can impact real estate values in several ways.
Generally, declining interest rates may lower the cost of capital allowing
buyers to pay more for a property whereas rising interest rates may increase
the cost of capital and lower the price of real estate. Lower interest rates
may increase the probability that borrowers' may seek prepayment of the
Partnership's loan whereas rising interest rates decrease the yields on the
loans and make prepayment less likely.

Inflation has several types of potentially conflicting impacts on real estate
investments. Short-term inflation can increase real estate operating costs
which may or may not be recovered through increased rents and/or sales prices,
depending on general or local economic conditions. In the long-term, inflation
can be expected to increase operating costs and replacement costs and may lead
to increased rental revenues and real estate values.

Certain statements in this Form 10-K 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 projections of revenues, income or losses, capital
expenditures, plans for future operations, financing plans or requirements, and
plans relating to properties of the Partnership, 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 materially
from any future results, performance or achievements expressed or implied by
the forward-looking statements.

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
--------------------
<PAGE>
On September 14, 1995 the Partnership approved the engagement of Coopers &
Lybrand LLP as its independent auditors for the fiscal year ending December 31,
1995 to replace the firm of Ernst & Young LLP, who were dismissed as auditors
of the Partnership effective September 14, 1995. The General Partner of the
Partnership approved the change in auditors.

The reports of Ernst & Young LLP on the Partnership's financial statements for
each of the two fiscal years ended December 31, 1994 did not contain an adverse
opinion or a disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope, or accounting principles.

In connection with the audits of the Partnership's financial statements for
each of the two fiscal years ended December 31, 1994, and in the subsequent
interim period, there were no disagreements with Ernst & Young LLP on any
matters of accounting principles or practices, financial statement disclosure,
or auditing scope and procedures which, if not resolved to the satisfaction of
Ernst & Young LLP would have caused Ernst & Young LLP to make reference to the
matter in their report.

                                   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 Vice President                   James E. Mendelson
     Senior Vice President                   John K. Powell, Jr.
     Managing Director, Chief                Jayne A. Kosik
          Financial Officer, Treasurer
          and Assistant Secretary                      

Thomas E. Meador (age 49) 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 Director of The Balcor Company. He is also 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.
<PAGE>
Alexander J. Darragh (age 42) joined Balcor in September 1988 and is
responsible for due diligence analysis and real estate advisory services for
Balcor and American Express Company. He also has supervisory responsibility for
Balcor's environmental matters. Mr. Darragh received masters' degrees in Urban
Geography from Queen's University and in Urban Planning from Northwestern
University.

James E. Mendelson (age 34) joined Balcor in July 1984 and is responsible for
Balcor's property sales activities. He also has supervisory responsibility for
Balcor's accounting, financial, treasury, investor services and investment
administration functions. From 1989 to 1995, Mr. Mendelson was Vice President -
Transaction Management and Vice President - Senior Transaction Manager and had
responsibility for various asset management matters relating to real estate
investments made by Balcor, including negotiations for the restructuring of
mortgage loan investments. Mr. Mendelson received his M.B.A. degree from the
University of Chicago. 

John K. Powell, Jr. (age 46) joined Balcor in September 1985 and is responsible
for portfolio and asset management matters relating to Balcor's partnerships.
Mr. Powell also has supervisory responsibility for Balcor's risk management
function. He received a Master of Planning degree from the University of
Virginia. Mr. Powell has been designated a Certified Real Estate Financier by
the National Society for Real Estate Finance and is a full member of the Urban
Land Institute.

Jayne A. Kosik (age 39) joined Balcor in August 1982 and, as Chief Financial
Officer, is responsible for Balcor's financial, human resources and treasury
functions. 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 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.

(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 1996.

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

The Registrant paid $8,955 in 1996 with respect to one of the executive
officers and directors of the General Partner. The Registrant has not paid and
does not propose to pay any remuneration to the remaining executive officers
and directors of the General Partner. Certain of the remaining 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 12 of Notes to Financial Statements for
information relating to transactions with affiliates.

Item 12. Security Ownership of Certain Beneficial Owners and Management
-----------------------------------------------------------------------
<PAGE>
(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 and its officers and partners own as a group
through the Early Investment Incentive Fund and otherwise 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 and affiliates of the officers and partners of the General Partner do
not own any additional Interests.

(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
-------------------------------------------------------

(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 12 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.

                                    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.
<PAGE>
(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)(a)(i)  Agreement of Sale and attachments thereto relating to the sale of
the Granada Apartments, Tampa, Florida previously filed as Exhibit (2)(a)(i) to
the Registrants Current Report on Form 8-K dated September 17, 1996 is
incorporated herein by reference.

(ii)  First Amendment to Agreement of Sale relating to the sale of the Granada
Apartments, Tampa, Florida previously filed as Exhibit (2)(a)(ii) to the
Registrant's Current Report on Form 8-K dated September 17, 1996 is
incorporated herein by reference.

(iii)  Letter Agreement dated October 7, 1996, relating to the sale of the
Granada Apartments, Tampa, Florida previously filed as Exhibit (99)(b) to the
Registrant's Current Report on Form 8-K dated October 3, 1996 is incorporated
herein by reference.

(iv) Second Amendment to Agreement of Sale relating to the sale of Granada 
Apartments, Tampa, Florida previously filed as Exhibit (10)(a)(iv) to the
Registrant's Current Report on Form 10-Q for the quarter ended September 30,
1996, is incorporated herein by reference.

(b)(i)  Agreement of Sale and attachments thereto relating to the sale of the
Plantation Apartments, Tampa, Florida previously filed as Exhibit (2)(b)(i) to
the Registrant's Current Report on Form 8-K dated September 17, 1996 is
incorporated herein by reference.

(ii)  First Amendment to Agreement of Sale relating to the sale of the
Plantation Apartments, Tampa, Florida previously filed as Exhibit (2)(b)(ii) to
the Registrant's Current Report on Form 8-K dated September 17, 1996 is
incorporated herein by reference.

(iii)  Letter Agreement dated October 7, 1996, relating to the sale of the
Plantation Apartments, Tampa, Florida previously filed as Exhibit (99)(c) to
the Registrant's Current Report on Form 8-K dated October 3, 1996 is
incorporated herein by reference.

(iv) Second Amendment to Agreement of Sale relating to the sale of Plantation 
Apartments, Tampa, Florida  previously filed as Exhibit (10)(b)(iv) to the
Registrant's Current Report on Form 10-Q for the quarter ended September 30,
1996, is incorporated herein by reference.

(c)(i)  Agreement of Sale and attachments thereto relating to the sale of the
The Glades on Ulmerton Apartments, Largo, Florida previously filed as Exhibit
(2)(c)(i) to the Registrant's Current Report on Form 8-K dated September 17,
1996 is incorporated herein by reference.

(ii)  First Amendment to Agreement of Sale relating to the sale of the The
Glades on Ulmerton Apartments, Largo, Florida previously filed as Exhibit
(2)(c)(ii) to the Registrant's Current Report on Form 8-K dated September 17,
1996 is incorporated herein by reference.
<PAGE>
(iii)  Letter Agreement dated October 7, 1996, relating to the sale of the The
Glades on Ulmerton Apartments, Largo, Florida previously filed as Exhibit
(99)(d) to the Registrant's Current Report on Form 8-K dated October 3, 1996 is
incorporated herein by reference.

(d)(i) Agreement of Sale and attachments thereto relating to the sale of the
Union Tower office building, Lakewood, Colorado previously filed as Exhibit (2)
to the Registrant's Current Report on Form 8-K dated October 10, 1996 is
incorporated herein by reference.

(ii)  First Amendment to Agreement of Sale relating to the sale of the Union
Tower office building, Lakewood, Colorado previously filed as Exhibit
(10)(d)(ii) to the Registrant's Current Report on Form 10-Q for the quarter
ended September 30, 1996, is incorporated herein by reference.

(e) Purchase and Sale Agreement relating to the sale of first mortgage loan
secured by The Glen Apartments, Fairfax County, Virginia is attached hereto.

(f)(i) Agreement of Sale and attachments thereto relating to the sale of the
1420 Harbor Bay Parkway, Alameda, California previously filed as Exhibit (2)(a)
to the Registrant's Current Report on Form 8-K dated December 6, 1996 is
incorporated herein by reference.

(ii) First Amendment to Agreement of Sale relating to the sale of the 1420
Harbor Bay Parkway, Alameda, California previously filed as Exhibit (2)(b) to
the Registrant's Current Report on Form 8-K dated December 6, 1996 is
incorporated herein by reference.

(iii) Second Amendment to Agreement of Sale relating to the sale of the 1420
Harbor Bay Parkway, Alameda, California is attached hereto.

(iv) Third Amendment to Agreement of Sale relating to the sale of the 1420
Harbor Bay Parkway, Alameda, California is attached hereto.

(16)  Letter from Ernst & Young LLP dated September 19, 1995 regarding the
change in the Registrant's certifying accountant previously filed as Exhibit 16
to the Registrant's Report on Form 8-K/A dated October 27, 1995 (Commission
File No. 0-13233) is hereby incorporated herein by reference.

(27) Financial Data Schedule of the Registrant for 1996 is attached hereto.

(99) Form of Notice of Proposed Class Action Settlement and Hearing relating to
Paul Williams and Beverly Kennedy, et al. vs. Balcor Pension Investors-V, et
al. previously filed as Exhibit (99)(c) to the Registrant's Report on Form 10-Q
for the quarter ended June 30, 1996 is incorporated herein by reference.

(b) Reports on Form 8-K: 

1) A Current Report on Form 8-K dated October 3, 1996, was filed relating to
the Agreement of Sale for Huntington Meadows Apartments, Arlington, Texas, and
to Letter Agreements for the sales of the Granada Apartments, Tampa, Florida,
the Plantation Apartments, Tampa, Florida and The Glades on Ulmerton
Apartments, Largo, Florida.
<PAGE>
2) A Current Report on Form 8-K dated October 10, 1996, was filed relating to
the Agreement of Sale for the Union Tower office building, Lakewood, Colorado.

3) A Current Report on Form 8-K dated December 6, 1996, was filed relating to
the Agreement of Sale and First Amendment to the Agreement of Sale for the 1420
Harbor Bay Parkway, Alameda, California, the closing of the sales of Villa
Medici Apartments, Overland Park, Kansas, The Glades on Ulmerton Apartments,
Largo, Florida, Plantation Apartments, Tampa, Florida, Granada Apartments,
Tampa, Florida, Union Tower office building, Lakewood, Colorado, Waldengreen
Apartments, Orlando, Florida, and Huntington Meadows Apartments, Arlington,
Texas.

(c) Exhibits: See Item 14(a)(3) above.

(d) Financial Statement Schedules: None
<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
                             Managing Director and Chief
                             Financial Officer (Principal Accounting
                             and Financial Officer) of Balcor Mortgage 
                             Advisors-V, the General Partner

Date:  March 28,1997             
      --------------

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
/s/Thomas E Meador       Advisors-V, the General Partner      March 28,1997   
--------------------                                        --------------
  Thomas E. Meador
                         Managing Director and Chief
                         Financial Officer (Principal 
                         Accounting and Financial
                         Officer) of Balcor Mortgage
 /s/Jayne A. Kosik       Advisors-V, the General Partner     March 28, 1997    
--------------------                                        --------------
   Jayne A. Kosik
<PAGE>


                         INDEX TO FINANCIAL STATEMENTS

Report of Independent Accountants

Report of Independent Auditors

Financial Statements:

Balance Sheets, December 31, 1996 and 1995

Statements of Partners' Capital, for the years ended December 31, 1996, 1995
and 1994

Statements of Income and Expenses, for the years ended December 31, 1996, 1995
and 1994

Statements of Cash Flows, for the years ended December 31, 1996, 1995 and 1994

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

We have audited the accompanying balance sheets of Balcor Pension Investors-V
(An Illinois Limited Partnership) as of December 31, 1996 and 1995 and the
related statements of partners' capital, income and expenses and cash flows for
each of the two years in the period ended December 31, 1996. 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 in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Balcor Pension Investors-V at
December 31, 1996 and 1995, and the results of its operations and its cash
flows for each of the two years in the period ended December 31, 1996, in
conformity with generally accepted accounting principles.

As described in Note 2 to the financial statements, the Partnership Agreement
provides for the dissolution of the Partnership upon disposition of all its
interests in real estate. The Partnership is presently marketing for sale its
remaining real estate asset and is seeking repayment of its remaining mortgage
loan receivable. Upon disposition of its remaining real estate asset, repayment
of the remaining mortgage loan receivable and resolution of the litigation
described in Note 15 to the financial statements, the Partnership intends to
cease operations and dissolve.


                                             /s/Coopers & Lybrand L.L.P.
                                             COOPERS & LYBRAND L.L.P.


Chicago, Illinois
March 26, 1997
<PAGE>
                        REPORT OF INDEPENDENT AUDITORS

To the Partners of
Balcor Pension Investors-V:

We have audited the accompanying statements of partners' capital, income and
expenses and cash flows of Balcor Pension Investors-V (An Illinois Limited
Partnership) for the year ended December 31, 1994.  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 audit.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the results of operations and cash flows of Balcor
Pension Investors-V for the year ended December 31, 1994, in conformity with
generally accepted accounting principles. 

                                     
                                        /s/Ernst & Young LLP 
                                        ERNST & YOUNG LLP


Chicago, Illinois
March 27, 1995
<PAGE>
                              BALCOR PENSION INVESTORS-V
                        (An Illinois Limited Partnership)

                                BALANCE SHEETS
                    December 31, 1996 and December 31, 1995

                                   ASSETS

                                              1996               1995
                                        ---------------    ---------------
Cash and cash equivalents               $   67,655,936     $   17,680,262
Escrow deposits - restricted                    95,243             42,103
Accounts and accrued interest receivable       665,695            576,378
Prepaid expenses                                38,651            145,027
Deferred expenses, net of accumulated
  amortization of $133,699 in 1996 and
  $261,244 in 1995                             196,549            149,904
                                        ---------------    ---------------
                                            68,652,074         18,593,674
                                        ---------------    ---------------
Investment in loans receivable:
  Loans receivable - wrap-around
    and first mortgages                      6,015,968         26,421,997
  Investment in acquisition loan                                8,439,304

Less:
  Loans payable - underlying mortgages                          2,539,832
  Allowance for potential loan losses        2,102,000          5,859,733
                                        ---------------    ---------------
Net investment in loans receivable           3,913,968         26,461,736

Real estate held for sale (net of 
  allowance of $2,711,056 in 1996
  and $4,955,000 in 1995)                    6,606,724         50,018,118
Investment in joint ventures-affiliates      3,042,286          4,606,036
                                        ---------------    ---------------
                                            13,562,978         81,085,890
                                        ---------------    ---------------
                                        $   82,215,052     $   99,679,564
                                        ===============    ===============


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

                                  BALANCE SHEETS
                    December 31, 1996 and December 31, 1995
                                  (Continued)


                      LIABILITIES AND PARTNERS' CAPITAL


Accounts and accrued interest payable   $      978,110     $      265,469
Due to affiliates                              150,580             49,849
Other liabilities, principally escrow 
  deposits and accrued real estate taxes       145,394            611,875
Security deposits                               81,774            493,733
                                        ---------------    ---------------
     Total liabilities                       1,355,858          1,420,926
                                        ---------------    ---------------

Commitments and contingencies

Limited Partners' capital
  (439,305 Interests issued
  and outstanding)                          80,322,266        102,310,790
General Partner's capital (deficit)            536,928         (4,052,152)
                                        ---------------    ---------------
     Total Partners' capital                80,859,194         98,258,638
                                        ---------------    ---------------
                                        $   82,215,052     $   99,679,564
                                        ===============    ===============




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, 1996, 1995 and 1994

                               Partners' Capital (Deficit) Accounts
                               -------------------------------------------
                                                  General       Limited
                                     Total        Partner       Partners
                               ---------------- ------------- ------------

Balance at December 31, 1993   $  116,834,271 $  (3,519,091)$ 120,353,362

Cash distributions (A)            (11,414,609)   (1,025,046)  (10,389,563)
Net income for the year
  ended December 31, 1994          10,835,098     1,083,510     9,751,588
                               ---------------- ------------- ------------
Balance at December 31, 1994      116,254,760    (3,460,627)  119,715,387

Cash distributions (A)            (30,141,205)   (1,806,033)  (28,335,172)
Net income for the year
  ended December 31, 1995          12,145,083     1,214,508    10,930,575
                               ---------------- ------------- ------------
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
                               ================ ============= ============


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

                                     1996           1995          1994
                               ---------------- ------------- ------------

             First quarter     $         5.00 $        4.00 $        9.00
             Second quarter             14.78          5.00          6.65
             Third quarter              41.72         31.82          4.00
             Fourth quarter             20.65         23.68          4.00




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, 1996, 1995 and 1994


                                      1996           1995          1994
                               ---------------- ------------- ------------
Income:
  Interest on loans receivable,
    and from investment in
    acquisition loan           $    3,575,255 $   5,834,417 $   8,035,744
  Less interest on loans
    payable - underlying
    mortgages                         185,693       273,184       472,303
                               ---------------- ------------- ------------
  Net interest income on 
    loans receivable                3,389,562     5,561,233     7,563,441

  Income from operations of
    real estate held for sale       4,160,232     5,366,016     3,406,925
  Interest on short-term
    investments                     1,141,900     1,007,008       714,328
  Participation income                 40,146       926,139        75,506
  Prepayment premiums                               315,000
  Recovery of losses on loans,
    real estate and accrued
    interest receivable             3,672,819     1,600,000
  Participation of income 
    (loss) of joint ventures-
    affiliates                        894,808      (204,085)      422,799
                               ---------------- ------------- ------------
    Total income                   13,299,467    14,571,311    12,182,999
                               ---------------- ------------- ------------
Expenses:
  Provision for potential 
    losses on loans, real 
    estate and accrued 
    interest receivable             1,499,518     1,117,110
  Amortization of deferred
    expenses                           55,455       199,150       129,874
  Administrative                    1,318,547     1,031,937     1,148,320
                               ---------------- ------------- ------------
    Total expenses                  2,873,520     2,348,197     1,278,194
                               ---------------- ------------- ------------
Income before equity in
  loss from investment
  in acquisition loan              10,425,947    12,223,114    10,904,805

Equity in loss from investment 
  in acquisition loan                 (52,021)      (78,031)      (69,707)
                               ---------------- ------------- ------------
<PAGE>
                          BALCOR PENSION INVESTORS-V
                       (An Illinois Limited Partnership)

                       STATEMENTS OF INCOME AND EXPENSES
             for the years ended December 31, 1996, 1995 and 1994
                                  (Continued)



Income before gain on sales of
  real estate                      10,373,926    12,145,083    10,835,098

Gain on sales of real estate        9,675,919
                               ---------------- ------------- ------------
Net income                     $   20,049,845 $  12,145,083 $  10,835,098
                               ================ ============= ============
Net income allocated to
  General Partner              $    5,949,464 $   1,214,508 $   1,083,510
                               ================ ============= ============
Net income allocated to
  Limited Partners             $   14,100,381 $  10,930,575 $   9,751,588
                               ================ ============= ============
Net income per Limited
   Partnership Interest
   (439,305 issued and
   outstanding)                $        32.10 $       24.88 $       22.20
                               ================ ============= ============


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, 1996, 1995 and 1994


                                     1996           1995          1994
                               ---------------  ------------  ------------
Operating activities:
  Net income                   $   20,049,845 $  12,145,083 $  10,835,098
  Adjustments to reconcile net 
    income to net cash provided
    by operating activities:
    Gain on sales of real estate   (9,675,919)
    Equity in loss from invest- 
      ment in acquisition loan         52,021        78,031        69,707
    Participation in (income)
      loss of joint
      ventures - affiliates          (894,808)      204,085      (422,799)
    Recovery of losses on loans,
      real estate and accrued
      interest receivable          (3,672,819)   (1,600,000)
    Provision for potential 
      losses on loans, real 
      estate and accrued 
      interest receivable           1,499,518     1,117,110
    Amortization of deferred
      expenses                         55,455       199,150       129,874
    Payment of leasing 
      commissions                    (102,100)                   (221,925)
    Accrued interest income 
      due at maturity                              (610,927)     (906,566)
    Collection of interest 
      income due at maturity          452,768     2,591,071        98,055
    Net change in:
      Escrow deposits
       - restricted                   (53,140)      342,522        (4,940)
      Accounts and accrued 
        interest receivable           (89,317)     (111,371)      681,297
      Prepaid expenses                106,376      (145,027)
      Accounts and accrued
        interest payable              712,641        35,805       (37,023)
      Due to affiliates               100,731       (86,694)         (178)
      Other liabilities              (466,481)     (386,838)      326,774
      Security deposits              (411,959)      137,104        66,460
                               ---------------  ------------  ------------
  Net cash provided by 
    operating activities            7,662,812    13,909,104    10,613,834
                               ---------------  ------------  ------------


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, 1996, 1995 and 1994
                                  (Continued)

                                     1996           1995          1994
                               ---------------  ------------  ------------

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)     (204,116)
  Distributions from joint 
    ventures - affiliates           2,481,317       398,620       590,827
  Collection of principal 
    payments on loans receivable   14,700,000    16,060,889       415,659
  Improvements to real estate        (628,831)     (439,382)     (377,081)
  Proceeds from sales
    of real estate                 55,506,000     2,570,208
  Costs incurred in 
    connection  with the
    sales of real estate           (1,924,522)     (175,495)
                               ---------------  ------------  ------------
  Net cash provided by
    investing activities       $   79,803,896 $  18,210,724 $     629,405
                               ---------------  ------------  ------------


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, 1996, 1995 and 1994
                                 (Continued)


                                     1996           1995          1994
                               ---------------  ------------  ------------
Financing activities:
  Distributions to Limited
    Partners                   $  (36,088,905)$ (28,335,172)$ (10,389,563)
  Distributions to General
    Partner                        (1,360,384)   (1,806,033)   (1,025,046)
  Principal payments on loans
     payable - underlying
     mortgages                        (41,745)     (343,945)     (471,728)
  Repayment of loans payable - 
    underlying mortgages                                       (4,689,871)
  Principal payments on mortgage 
    notes payable                                                  (4,004)
  Repayment of mortgage
    note payable                                               (2,241,349)
                               ---------------  ------------  ------------
  Net cash used in financing
    activities                    (37,491,034)  (30,485,150)  (18,821,561)
                               ---------------  ------------  ------------
Net change in cash and 
    cash equivalents               49,975,674     1,634,678    (7,578,322)
Cash and cash equivalents at 
    beginning of period            17,680,262    16,045,584    23,623,906
                               ---------------  ------------  ------------
Cash and cash equivalents
  at end of period             $   67,655,936 $  17,680,262 $  16,045,584
                               ================ ============= ============


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") is engaged in the operation of
residential and commercial real estate located in Overland Park, Kansas and
Alameda, California. Additionally, the Partnership has an investment in a first
mortgage loan.

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. During 1996 the Registrant sold the 45 West 45th Street Office
Building in which it held a minority joint venture interest, the Glades on
Ulmerton, Granada, Plantation, Huntington Meadows, Waldengreen and the Villa
Medici apartment complexes and the Union Tower office building.  The Registrant
sold the Harbor Bay office building in January 1997. The Registrant is actively
marketing the property in which it holds a minority joint venture interest for
sale and seeking repayment of its remaining loan. 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 stemming from litigation
involving the Partnership including but not limited to, the lawsuit discussed
in Note 15 of Notes to Financial Statements.  In the absence of any
contingency, the reserves will be paid within twelve months of the last
property being sold.  In the event a contingency exists, reserves may be
held by the Partnership for alonger period of time.

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 records wrap-around mortgage loans at the face amount of
the mortgage instrument which includes the outstanding indebtedness of the
borrower under the terms of the underlying mortgage obligations. The underlying
mortgage obligations were recorded as a reduction of the wrap-around mortgage
loan and the resulting balance represented the Partnership's net advance to the
borrower. 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 agreement were received by the Partnership from the
borrower.
<PAGE>
(c) Income on loans is recorded as earned in accordance with the terms of the
related loan agreements. The accrual of interest is discontinued when a loan
becomes ninety days contractually delinquent or sooner when, in the opinion of
the General Partner, an impairment has occurred in the value of the collateral
property securing the loan. Income on nonaccrual loans or loans which are
otherwise not performing in accordance with their terms is recorded on a cash
basis.

Various loan agreements provide for participation by the Partnership in
increases in value of the collateral property when the loan is repaid or
refinanced. In addition, certain loan agreements allow the Partnership to
receive a percentage of rental income exceeding a base amount. Participation
income is 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) Loan losses on mortgage notes receivable are charged to income and an
allowance account is established when the General Partner believes the loan
balance will not be recovered.  The General Partner assesses the collectibility
of each loan on a periodic basis through a review of the collateral property
operations, the property value and the borrower's ability to repay the loan.
Upon foreclosure, the loan net of the allowance is transferred to real estate
held for sale after the fair value of the property, less costs of disposal is
assessed.  Upon the transfer to real estate held for sale, a new basis in the
property is established.

Effective January 1, 1995 the Partnership adopted Statement of Financial
Accounting Standards, No. 121 (SFAS 121), "Accounting for the Impairment of
Long-Lived Assets and Long-Lived Assets to be Disposed Of".  Under SFAS 121,
the Partnership records its investments in real estate at the lower of cost or
fair value, and periodically assesses, but not less than on an annual basis,
fair value of its real estate properties held for sale.  The General Partner
estimates the fair value of its properties based on the current sales price
less estimated closing costs. Changes in the property's fair value are recorded
by an adjustment to the property allowance account and are 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 is determined. The
General Partner considers 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 indicate otherwise.

(e) Under certain circumstances, the Partnership may accept promissory notes in
satisfaction of a borrower's obligations for certain fees upon prepayment of a
loan as required by the loan agreement. These fees include, among other things,
prepayment penalties and participations in the borrower's appreciation in the
collateral property. The Partnership's policy is to record such income on a
cash basis as payments required under the terms of the promissory notes are
received.
<PAGE>
(f) Investment in the acquisition loan represented a first mortgage loan which,
because the loan agreement included certain specified terms, must be accounted
for as an investment in a real estate venture. The investment was therefore
reflected in the accompanying financial statements using the equity method of
accounting. Under this method, the Partnership recorded its investment at cost
(representing total loan funding) and subsequently adjusted its investment for
its share of property income or loss.

Amounts representing contractually required debt service are 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.

(g) Investment in joint venture - affiliate represents the Partnership's 25%
interest, under the equity method of accounting, in a joint venture with an
affiliate. Under the equity method of accounting, the Partnership records its
initial investment at cost and adjusts its investment account for additional
capital contributions, distributions and its share of joint venture income or
loss.

(h) Deferred expenses consist of loan application and processing fees and
mortgage brokerage fees which were amortized over the terms of the respective
agreements, and leasing commissions which are amortized over the life of each
respective lease. These fees are fully amortized when a property is sold.

(i)  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 is recognized on a straight line
basis over the respective lease term. Service income includes reimbursements
from operating costs such as real estate taxes maintenance and insurance and is
recognized as revenue in the period the applicable costs are incurred.

(j) The Financial Accounting Standard Board's Statement No. 107, "Disclosures
About Fair Value of Financial Instruments", requires disclosure of fair value
information about financial instruments for which it is practicable to estimate
that value. Since quoted market prices are not available for the Partnership's
financial instruments, fair values have been based on estimates using present
value techniques. These techniques are significantly affected by the
assumptions used, including the discount rate and estimates of future cash
flows. In that regard, the derived fair value estimates cannot be substantiated
by comparison to independent markets and, in many cases, may not be realized in
immediate settlement of the instrument. Statement No. 107 does not apply to all
balance sheet items and excludes certain financial instruments and all
non-financial instruments such as real estate and investment in joint ventures
from its disclosure requirements.

(k) 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.
<PAGE>
(l) 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.

(m) For financial statement purposes, in previous years partners were allocated
income and loss in accordance with the profit and loss percentages in the
Partnership Agreement. In order for the capital accounts of the General Partner
and Limited Partners to appropriately reflect their respective remaining
economic interests as provided for in the Partnership Agreement, the General
Partner was allocated additional income in 1996 for financial statement
purposes.

(n) Several reclassifications have been made to the previously reported 1994
financial statements to conform with the classification used in 1995 and 1996.
Mortgage servicing fees have been reclassified and are included in
administrative expenses during 1995 and 1996. This reclassification has also
been made to the previously reported 1994 financial statements to conform with
the classification used in 1995 and 1996. These reclassifications have not
changed the 1994 results.

4. Partnership Agreement:

The Partnership was organized in October 1983. The Partnership Agreement
provides for Balcor Mortgage Advisors-V to be the General Partner and 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.

Pursuant to the Partnership Agreement, all income of the Partnership will be
allocated 90% to the Limited Partners and 10% to the General Partner and all
losses will be allocated 99% to the Limited Partners and 1% to the General
Partner.

To the extent that Cash Flow is generated, distributions will be made as
follows: (i) 90% of such Cash Flow will be distributed to the Limited Partners,
(ii) 7.5% of such Cash Flow will be distributed to the General Partner, and
(iii) an additional 2.5% of such Cash Flow will be distributed to the General
Partner and shall constitute the Early Investment Incentive Fund (the "Fund").
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, if necessary for Early Investors to receive a
return of their Original Capital plus a specified Cumulative Return based on
the date of investment.

At the sole discretion of the General Partner and subject to certain
limitations as set forth in the Partnership Agreement, amounts placed in the
Fund were available to repurchase Interests from existing Limited Partners.
During 1996, the Fund repurchased 5,319 Interests at a total cost of
$1,187,603. All repurchases of Interests have been made at 90% of the then
current valuation of such Limited Partnership Interests at the previous quarter
<PAGE>
end less any distributions made after the previous quarter end. Distributions
of Cash Flow and Mortgage Reductions pertaining to such repurchased Interests
will be paid to the Fund. In February 1997, the Partnership discontinued the
repurchase of Interests from Limited Partners.

5. Investment in Loan Receivable:

The Meadow Run Apartments first mortgage loan receivable, which was funded in
1984, had a balance of $6,015,968 at December 31, 1996 and 1995. This balance
includes an additional amount of interest that accrued and will be payable to
the Partnership upon repayment of the loan, or upon sale of the property.
Current monthly payments of $43,063 are due at an interest rate of 13.25% per
annum. The 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 not able to obtain financing by December 1996 but
continues to make monthly interest payments to the Partnership. The General
Partner is monitoring the borrower's efforts to seek alternate financing.  The
Partnership may receive additional payments from the borrower representing
participation in the operating results of the collateral property which exceeds
specified levels and a share of appreciation in the collateral property upon
repayment or refinancing. 
                                    
(B) In March 1994, the Seven Trails West Apartments loan matured and was
extended for two years on the same terms as the previously modified loan,
except for an increase in the interest rate from 10% to 11% per annum. In
addition, in March 1994 the $4,689,871 underlying first mortgage loan on the
property was purchased by the Partnership at face value. The Seven Trails West
Apartments loan matured in February 1996. The Partnership extended the loan
until April 1, 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. 

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,
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
<PAGE>
cash sale for $17,725,000 of which $7,226,945 is 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.

Loans are classified as non-accrual as a result of delinquency or other
noncompliance with terms of loan agreements; such loans aggregated $15,152,768
at December 31, 1995 and none at December 31, 1996.

Non-accrual loans and loans which have been restructured are hereinafter
referred to as impaired loans. Net interest income relating to impaired loans
would have been $3,040,000 in 1995 and $2,906,000 in 1994. Net interest income
received from impaired loans included in the accompanying Statements of Income
and Expenses amounted to $2,227,000 (cash basis and accrual basis) in 1995,
$1,826,000 (cash basis and accrual basis) in 1994.  

Impaired loans totaled $15,152,768 at December 31, 1995 and none at December
31, 1996. The impaired loan had a related allowance for losses of $2,478,000 in
1995. The average recorded investments in impaired loans during the year ended
December 31, 1995 was approximately $18,689,610 and $7,576,384 at December 31,
1996.  

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, 1996 is described in the
table below:

                             1996          1995           1994
                          -----------   -----------   -----------
  Loans:
   Balance at beginning 
    of year               $5,859,733    $5,957,614     $5,957,614
   Provision charged to
    income                   511,415       300,000           None
   Recovery of provision
    previously charged
    to income             (2,819,382)
   Direct write-off           
    of loans against
    allowance             (1,449,766)     (397,881)          None
                          -----------   -----------    ----------
    Balance at the end of
     the year             $2,102,000    $5,859,733    $ 5,957,614
                          ===========   ===========   ===========
<PAGE>
  Real Estate Held for Sale:
   Balance at beginning of
     year                 $4,955,000    $6,055,000    $6,055,000 
   Provision charged to
     income                  988,103       817,110           None
   Recovery of provision
    previously charged to
    income                  (853,437)   (1,600,000)          None
   Direct write-off           
    of real estate
    held for sale
    against allowance     (2,378,610)     (317,110)          None
                          -----------   -----------   ------------
   Balance at the end of   
     the year             $2,711,056    $4,955,000    $ 6,055,000
                          ===========   ===========   ===========  

9. Mortgage Notes Payable:

During February 1994 the Partnership prepaid the underlying first mortgage on
The Glades on Ulmerton Apartments of $2,241,349. During the year ended December
31, 1994 the Partnership incurred and paid interest expense on mortgage notes
payable for properties held during the year of $34,585.  

10. Management Agreement:

As of December 31, 1996, the property owned by the Partnership is under a
management agreement with a third-party company.  This management agreement
provides for annual fees of 3% to 6% of gross operating receipts.

11. Investment in Joint Ventures - Affiliates:

The Partnership has classified the Whispering Hills Apartments first mortgage
loan investment as an investment in joint venture - affiliate. This investment
represents a joint venture between the Partnership and an affiliate. Profits
and losses are allocated 25% to the Partnership and 75% to the affiliate.

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 owns a 21.74% joint venture interest in the
property. During 1995, the Partnership recognized $537,630 as its share of the
provision related to the change in the estimate of the fair value of 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
financial statement purposes, the joint venture recognized a gain of
$2,934,185, of which $637,892 represents the Partnership's share.

These amounts are included in the Partnership's participation in income (loss)
of joint ventures with affiliates. During 1996, 1995, and 1994 the Partnership
received distributions from these joint ventures totaling $2,481,317, $398,620,
and $590,827, respectively, and made contributions of $22,759 and $204,116 in
1996 and 1995, respectively.
<PAGE>
12. Transactions with Affiliates:

Fees and expenses paid and payable by the Partnership to affiliates are:

                            Year Ended       Year Ended       Year Ended
                             12/31/96         12/31/95         12/31/94   
                          --------------   --------------   --------------
                           Paid  Payable    Paid  Payable    Paid  Payable
                          ------ -------   ------ -------   ------ -------

Mortgage servicing fees  $ 54,285 $ 1,959  $91,569 $ 5,481 $131,305 $10,930
Property management fees     None    None     None    None  460,824    None
Reimbursement of expenses
  to the General Partner,
  at cost:
    Accounting             27,291  23,720   82,348   9,881   84,961  38,028
    Data processing         8,406   3,308   49,177   4,775   87,782  20,653
    Investor communica-
      tions                  None    None   11,014       0   36,782  10,098
    Legal                  15,436  13,416   24,592   3,681    9,688   8,403
    Portfolio management  103,642  90,082  154,618  25,969  100,599  42,147
    Other                  20,819  18,095    6,028      62   27,070   6,284

The Partnership participates in an insurance deductible program with other
affiliated partnerships in which the program pays claims up to the amount of
the deductible under the master insurance policies for its properties. The
program is administered by an affiliate of the General Partner who receives no
fee for administering the program; however, the General Partner is reimbursed
for program expenses. The Partnership paid premiums to the deductible insurance
program of $17,633, $63,806 and $126,944 for 1996, 1995 and 1994, respectively.

Allegiance Realty Group, Inc., an affiliate of the General Partner, managed all
of the Partnership's properties until the affiliate was sold to a third party
in November 1994.

13. Real Estate Held for Sale:

The Partnership acquired the Villa Medici Apartments through foreclosure in
March 1995 and classified it as real estate held for sale at December 31, 1994.
This acquisition represents a noncash transaction to the Partnership.
Accordingly, the noncash aspect of this acquisition is not presented in the
Partnership's Statements of Cash Flow.  The Partnership recorded the cost of
the property at $9,382,780.  This amount represents the outstanding loan
balance plus accrued interest receivable.  In addition, the Partnership reduced
the basis of the property by $115,493 for certain receivables, liabilities,
escrows and costs recognized or incurred in connection with the foreclosure.
At the date of foreclosure, the property was transferred to real estate held
for sale at its fair value.

14. Disposition of Properties Acquired Through Foreclosure:
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(a) 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. 

(b) 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.

(c) 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.

(d) 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. 

(e) 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.

(f) 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.

(g) 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.

15. Contingency and Settlement of Litigation:
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The Partnership is currently involved in a lawsuit whereby the Partnership the
General Partner and certain third parties have been named as defendants seeking
damages relating to tender offers to purchase interest in the Partnership and
nine affiliated partnerships initiated by the third party defendants in 1996.
The defendants continue to vigorously contest this action. This action has been
dismissed with prejudice and plaintiffs have filed an appeal. It is not
determinable at this time whether or not an unfavorable decision in this action
would have a material adverse impact on the financial position, operations and
liquidity of the Partnership. The Partnership believes it has meritorious
defenses to contest the claims.

A settlement has received final approval by the court in November 1996 in the
class action, Paul Williams and Beverly Kennedy, et.al. v. Balcor Pension
Investors, et. al. upon the terms described in the notice to class members in
September 1996. The settlement had no material impact on the Partnership.

16. Fair Value of Financial Instruments:

The carrying amounts and fair values of the Partnership's financial instruments
at December 31, 1996 and 1995 are as follows:

The carrying value of cash and cash equivalents, accounts and accrued interest
receivable and accounts and accrued interest payable approximates fair value.

Loans receivable: The fair value of the Partnership's investment in the loans
receivable approximates the carrying value of $6,015,968.

The fair value for the Partnership's investments in loans receivable was
estimated using discounted cash flow analyses. The discount rates were based
upon rates at the end of 1996 and 1995 comparable to those the Partnership
could receive or charge in the commercial real estate lending market with terms
and maturities comparable to the Partnership's loans receivable and mortgage
note it presently holds.

17. Subsequent Events:

(a) In January 1997, the Partnership made a distribution of $55,352,430
($126.00 per Interest) to the holders of Limited Partnership Interests
representing a regular quarterly distribution of Cash Flow of $5.00 per
Interest for the fourth quarter of 1996 and a special distribution of $121.00
per Interest primarily from proceeds received form the seven property sales in
1996.

(b) 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.  For financial statement purposes, the
Partnership recognized an additional provision of $11,056 in 1996 and will
recognize no gain or loss in 1997. 
 
(c) In February 1997, the General Partners made a settlement payment of
$164,739 ($.38 per $500 Interest) to members of the class pursuant to the
settlement approved by the court in November 1996 in the Paul Williams and
Beverly Kennedy et. al. vs. Balcor Pension Investors-V, et. al. class action
lawsuit.
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