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

                   For the fiscal year ended December 31, 2002

                                       OR

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

                        For the transition period from to

                         Commission file number 0-22485

                           CNL INCOME FUND XVII, LTD.
             (Exact name of registrant as specified in its charter)

         Florida                                      59-3295393
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
incorporation or organization)

                             450 South Orange Avenue
                           Orlando, Florida 32801-3336
          (Address of principal executive offices, including zip code)

       Registrant's telephone number, including area code: (407) 540-2000

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

  Title of each class:                    Name of exchange on which registered:
       None                                             Not Applicable

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

              Units of limited partnership interest ($10 per Unit)
                                (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 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. No [x]

         Indicate by check mark whether the registrant is an  accelerated  filer
(as defined in Exchange Act Rule 12b-2): Yes___ No X

         Aggregate market value of the voting stock held by nonaffiliates of the
registrant:  The registrant registered an offering of 3,000,000 units of limited
partnership  interest  (the  "Units") on Form S-11 under the  Securities  Act of
1933, as amended. Since no established market for such Units exists, there is no
market value for such Units. Each Unit was originally sold at $10 per Unit.

                      DOCUMENTS INCORPORATED BY REFERENCE:
                                      None


<PAGE>

                                     PART I

Item 1.  Business

         CNL Income Fund XVII, Ltd. (the "Registrant" or the "Partnership") is a
limited  partnership  which was  organized  pursuant to the laws of the State of
Florida on February 10, 1995. The general partners of the Partnership are Robert
A.  Bourne,  James  M.  Seneff,  Jr.  and  CNL  Realty  Corporation,  a  Florida
corporation  (the  "General  Partners").  Beginning on  September  2, 1995,  the
Partnership offered for sale up to $30,000,000 of limited partnership  interests
(the  "Units")  (3,000,000  Units at $10 per Unit)  pursuant  to a  registration
statement on Form S-11 under the Securities  Act of 1933, as amended,  effective
August 11, 1995.  The offering  terminated  on September 19, 1996, at which date
the maximum  offering  proceeds of $30,000,000  had been received from investors
who  were  admitted  to  the  Partnership  as  limited  partners  (the  "Limited
Partners").

         The  Partnership  was organized to acquire both newly  constructed  and
existing  restaurant  properties,  as well as properties upon which  restaurants
were to be  constructed  (the  "Properties"),  which  are  leased  primarily  to
operators of national and regional  fast-food,  family-style  and casual  dining
restaurant  chains (the  "Restaurant  Chains").  Net proceeds to the Partnership
from its  offering of Units,  after  deduction  of  organizational  and offering
expenses, totalled $26,400,000 and were used as of December 31, 1998, to acquire
29 Properties,  pay  acquisition  fees  totalling  $1,350,000 and to establish a
working  capital reserve for Partnership  purposes.  The 29 Properties  included
four  Properties  owned  by  joint  ventures  in  which  the  Partnership  is  a
co-venturer and three  Properties  owned with affiliates of the General Partners
as tenants-in-common.

         As of December 31, 1999, the  Partnership  owned 29 Properties,  either
directly or indirectly through joint venture or tenancy in common  arrangements.
In January  2000,  the  Partnership  reinvested  the  majority  of the net sales
proceeds  received  from El Cajon  Joint  Venture  in a  Property  in  Wilmette,
Illinois.  In addition,  during 2000,  the  Partnership  sold its  Properties in
Warner  Robins,  Georgia  and Long  Beach,  California.  During  the year  ended
December 31, 2001,  the  Partnership  reinvested the net sales proceeds from the
2000 sale of the Property in Warner Robins,  Georgia, and Long Beach, California
along with a portion of the net sales  proceeds  received  from the 2001 sale of
the Property in Houston,  Texas,  and entered into a joint venture  arrangement,
CNL VII & XVII Lincoln Joint Venture,  with an affiliate of the General Partners
to purchase and hold one  property in Lincoln,  Nebraska,  indirectly  through a
joint venture in which the  Partnership  is a co-venturer.  In addition,  during
2001, the Partnership  sold its Properties in Kentwood,  Missouri and El Dorado,
California,  and  reinvested a portion of these net sales proceeds in a Property
in Austin, Texas, and in a Property in Waldorf,  Maryland, as tenants-in-common,
with affiliates of the General Partners, which are Florida limited partnerships.
In addition, during 2001, the Partnership distributed to the Limited Partners, a
portion  of the  net  sales  proceeds  received  from  the  sale  in  Inglewood,
California and a portion of the net sales proceeds received from the sale of the
Property in Houston,  Texas. During 2002, the Partnership sold its properties in
Mesquite, Nevada; Knoxville,  Tennessee; and Wilmette,  Illinois, and reinvested
the  majority  of the sales  proceeds in a Property  in Houston  Texas;  a joint
venture  arrangement,  Katy Joint  Venture,  with an  affiliate  of the  General
Partners and a Florida limited partnership, to purchase and hold one Property in
Katy, Texas; and in a Property in Kenosha, Wisconsin, as tenants-in-common, with
another  affiliate of the General  Partners and a Florida  limited  partnership.
Also during 2002, CNL Mansfield Joint Venture,  in which the Partnership  owns a
21% interest, sold its Property in Mansfield,  Texas and reinvested the proceeds
in a Property in Arlington, Texas.

         As of December 31, 2002, the  Partnership  owned 27 Properties.  The 27
Properties  include  five  Properties  owned by  joint  ventures  in  which  the
Partnership  is a  co-venturer  and six  Properties  owned  with  affiliates  as
tenants-in-common.   The  Partnership  generally  leases  the  Properties  on  a
triple-net  basis with the lessees  responsible for all repairs and maintenance,
property taxes, insurance and utilities.

         The  Partnership  holds  its  Properties  until  the  General  Partners
determine that the sale or other  disposition of the Properties is  advantageous
in view of the Partnership's investment objectives.  In deciding whether to sell
Properties,  the General  Partners  consider  factors such as potential  capital
appreciation,  net cash flow and  federal  income  tax  considerations.  Certain
lessees also have been granted options to purchase Properties,  generally at the
Property's  then fair market  value after a specified  portion of the lease term
has elapsed.  The  Partnership has no obligation to sell all or any portion of a
Property  at any  particular  time,  except as may be  required  under  property
purchase options granted to certain lessees.



<PAGE>


Leases

         Although there are variations in the specific terms of the leases,  the
following  is  a  summarized   description  of  the  general  structure  of  the
Partnership's  leases.  The leases of the  Properties  provide for initial terms
ranging from 10 to 20 years (the average being 18 years) and expire between 2011
and 2020. The majority of the leases are on a triple-net basis, with the lessees
responsible  for all repairs and  maintenance,  property  taxes,  insurance  and
utilities.  The leases of the Properties  provide for minimum base annual rental
payments (payable in monthly installments) ranging from approximately $63,000 to
$246,400. The majority of the leases provide for percentage rent, based on sales
in excess of a specified amount. In addition, the majority of the leases provide
that,  commencing in specified lease years (generally the sixth lease year), the
annual base rent required under the terms of the lease will increase.

         Generally,  the  leases  of the  Properties  provide  for  two to  five
five-year  renewal  options  subject  to the same  terms and  conditions  as the
initial lease.  Lessees of 22 of the  Partnership's 27 Properties also have been
granted options to purchase  Properties at the Property's then fair market value
after a specified portion of the lease term has elapsed.  Fair market value will
be determined  through an appraisal by an independent  appraisal firm. Under the
terms of certain leases,  the option purchase price may equal the  Partnership's
original cost to purchase the Property  (including  acquisition  costs),  plus a
specified percentage from the date of the lease or a specified percentage of the
Partnership's purchase price, if that amount is greater than the Property's fair
market value at the time the purchase option is exercised.

         The leases generally provide that, in the event the Partnership  wishes
to sell the Property  subject to the terms of the lease,  the Partnership  first
must offer the lessee the right to purchase  the  Property on the same terms and
conditions,  and for the same  price,  as any offer  which the  Partnership  has
received for the sale of the Property.

         During  2001,   Phoenix   Restaurant  Group,  Inc.  ("PRG")  filed  for
bankruptcy and neither rejected,  nor affirmed the lease held by the Partnership
with an affiliate of the general partners, as tenants-in-common. The Partnership
owns  approximately  a 27% interest in the tenancy in common.  During 2002,  the
bankruptcy  court assigned the lease relating to the property in Corpus Christi,
Texas to RAI,  LLC,  which is an  affiliate of the General  Partners.  All other
lease terms remained the same.

         Effective  May 2002,  the leases  relating to the Arby's  Properties in
Muncie and Plainfield,  Indiana were amended to eliminate  guaranteed  scheduled
rent  increases.  The General  Partners do not believe that the rent  reductions
will  have a  material  adverse  effect  on the  results  of  operations  of the
Partnership. All other lease terms remain unchanged.

         During  2002,  the  Partnership  reinvested  the net sales  proceeds it
received  from the  sales of the  Properties  in  Mesquite,  Nevada;  Knoxville,
Tennessee;  and  Wilmette,  Illinois,  in a Taco  Cabana  Property in located in
Houston,  Texas;  a joint  venture  arrangement,  Katy  Joint  Venture,  with an
affiliate of the General Partners and a Florida limited partnership, to purchase
and  hold a Taco  Cabana  Property  in  Katy,  Texas;  and in a Texas  Roadhouse
Property in Kenosha, Wisconsin, as tenants-in-common,  with another affiliate of
the General  Partners and a Florida limited  partnership.  Also during 2002, CNL
Mansfield Joint Venture, in which the Partnership owns a 21% interest,  sold its
Property in Mansfield,  Texas and  reinvested  the proceeds in a Jack in the Box
Property  in  Arlington,  Texas.  The  lease  terms  for  these  Properties  are
substantially the same as the Partnership's other leases.

         In December 2002, AmeriKing Corporation, the parent company to National
Restaurant  Enterprises,  Inc.  which is the tenant of the Properties in Chicago
Ridge and Harvey,  Illinois,  filed for bankruptcy  protection.  As of March 10,
2003, the Partnership has continued  receiving rental payments relating to these
leases. While the tenant has neither rejected nor affirmed the leases, there can
be no assurance that they will not be rejected in the future.  The lost revenues
that would result if the tenant rejects these leases will have an adverse effect
on the results of operations of the  Partnership if the Partnership is unable to
lease the Properties in a timely manner.

Major Tenants

         During  the  year  ended  December  31,  2002,  three  lessees  of  the
Partnership,  Golden Corral Corporation,  National Restaurant Enterprises, Inc.,
and RTM  Indianapolis,  Inc. and RTM Southwest Texas, Inc. (which are affiliated
entities  under common  control)  (hereinafter  referred as "RTM,  Inc."),  each
contributed more than 10% of the Partnership's  total rental revenues (including
rental  revenues from the  Partnership's  share of rental income from Properties
owned by joint  ventures and  Properties  owned with separate  affiliates of the
General Partners as  tenants-in-common).  As of December 31, 2002, Golden Corral
Corporation  was the lessee  under  leases  relating  to four  restaurants,  and
National Restaurant Enterprises,  Inc. and RTM, Inc., were each the lessee under
leases  relating  to three  restaurants.  It is  anticipated  that  based on the
minimum rental  payments  required by the leases,  these three lessees each will
continue to contribute  more than 10 percent of the  Partnership's  total rental
revenues in 2003. In addition,  three Restaurant Chains,  Golden Corral,  Burger
King, and Arby's,  each accounted for more than 10 percent of the  Partnership's
total rental revenues during the year ended December 31, 2002 (including  rental
revenues from the Partnership's  share of rental income from Properties owned by
joint  ventures and  Properties  owned with  separate  affiliates of the General
Partners as  tenants-in-common).  In 2003, it is anticipated  that each of these
three Restaurant  Chains will continue to contribute more than 10 percent of the
Partnership's  rental  revenues to which the  Partnership  is entitled under the
terms of the leases.  Any failure of these  lessees or  Restaurant  Chains could
have a material adverse affect on the Partnership's income if the Partnership is
not able to re-lease or sell the Properties in a timely  manner.  As of December
31, 2002, Golden Corral Corporation leased Properties with an aggregate carrying
value in excess of 20% of the total assets of the Partnership.

Joint Venture and Tenancy in Common Arrangements

         The  partnership  has  entered  into the  following  joint  venture and
tenancy in common arrangements as of December 31, 2002:
<TABLE>
<CAPTION>

         Entity Name             Year      Ownership               Partners                   Property

 <c>
CNL Income Fund XVI, Ltd and     1996       19.56%      CNL Income Fund XVI, Ltd.        Fayetteville, NC
     CNL Income Fund XVII,
     Ltd. Tenants in Common

CNL Income Fund XI, Ltd. and     1997       27.42%      CNL Income Fund XI, Ltd.         Corpus Christi, TX
     CNL Income Fund XVII,
     Ltd. Tenants in Common

CNL Income Fund XIII, Ltd.       1997       36.91%      CNL Income Fund XIII, Ltd.       Akron, OH
     and CNL Income Fund
     XVII, Ltd. Tenants in
     Common

CNL Mansfield Joint Venture      1997       21.00%      CNL Income Fund VII, Ltd.        Arlington, TX

Kingston Joint Venture           1997       60.06%      CNL Income Fund XIV, Ltd.        Kingston, TN

CNL Income Fund IV, Ltd. and     1999       24.00%      CNL Income Fund IV, Ltd.         Zephyrhills, FL
     CNL Income Fund XVII,
     Ltd. Tenants in Common

Ocean Shores Joint Venture       1999       30.94%      CNL Income Fund X, Ltd.          Ocean Shores, WA


CNL VII and XVII Lincoln         2001       86.00%      CNL Income Fund VII, Ltd.        Lincoln, NE
     Joint Venture

CNL Income Fund VI, Ltd., CNL    2001       25.00%      CNL Income Fund VI, Ltd.         Waldorf, MD
     Income Fund IX, Ltd. and                           CNL Income Fund IX, Ltd.
     CNL Income Fund XVII,
     Ltd. Tenants in Common

Katy  Joint Venture              2002       40.00%      CNL Income Fund IX, Ltd.         Katy, TX

CNL Income Fund VIII, Ltd.       2002       90.00%      CNL Income Fund VIII, Ltd.       Kenosha, WI
     and CNL Income Fund
     XVII, Ltd. Tenants in
     Common
</TABLE>

         Each  joint  venture  or  tenancy  in  common  was  formed  to hold one
Property.  Each CNL Income Fund is an affiliate of the General Partners and is a
limited partnership  organized pursuant to the laws of the state of Florida. The
Partnership shares management control equally with the affiliates of the General
Partners.

         The joint  venture and tenancy in common  arrangements  provide for the
Partnership and its joint venture and tenancy in common partners to share in all
costs and benefits in proportion to each  partner's  percentage  interest in the
business entity. The Partnership and its partners are also jointly and severally
liable for all debts,  obligations and other liabilities of the joint venture or
tenancy in common.  Net cash flow from  operations is  distributed to each joint
venture  or  tenancy  in  common  partner  in  accordance  with  its  respective
percentage interest in the business entity.

         CNL VII and XVII Lincoln Joint Venture and Katy Joint Venture, each has
an initial term of 30 years, and each of the other joint ventures has an initial
term of 20 years and,  after the  expiration  the  initial  term,  continues  in
existence  from year to year  unless  terminated  at the option of either  joint
venturer  or by an event of  dissolution.  Events  of  dissolution  include  the
bankruptcy,  insolvency  or  termination  of any  joint  venturer,  sale  of the
Property owned by the joint venture and mutual  agreement of the Partnership and
its joint  venture  partners  to dissolve  the joint  venture.  Any  liquidation
proceeds,  after paying joint venture debts and liabilities and funding reserves
for  contingent  liabilities,  will be  distributed  first to the joint  venture
partners with positive  capital account  balances in proportion to such balances
until such  balances  equal zero,  and  thereafter  in  proportion to each joint
venture partner's percentage interest in the joint venture.

         The joint  venture  and  tenancy  in common  agreements  restrict  each
party's  ability to sell,  transfer  or assign  its joint  venture or tenancy in
common interest without first offering it for sale to its partners,  either upon
such terms and conditions as to which the parties may agree or, in the event the
parties cannot agree, on the same terms and conditions as any offer from a third
party to purchase such joint venture or tenancy in common interest.

         In June 2002, the Partnership entered into a joint venture arrangement,
Katy Joint  Venture,  with CNL Income Fund IX, Ltd., an affiliate of the General
Partners and a Florida limited partnership to purchase and hold one property. In
addition,  in August 2002, the  Partnership  entered into an agreement to hold a
Property in Kenosha, Wisconsin, as tenants-in-common, with CNL Income Fund VIII,
Ltd., an affiliate of the General Partners and a Florida limited partnership.

         The use of joint venture and tenancy in common  arrangements allows the
Partnership  to fully invest its available  funds at times at which it would not
have  sufficient  funds to purchase an additional  property,  or at times when a
suitable  opportunity to purchase an additional  property is not available.  The
use of joint  venture  and  tenancy in common  arrangements  also  provides  the
Partnership  with  increased  diversification  of its portfolio  among a greater
number of properties. In addition,  tenancy in common arrangements may allow the
Partnership  to defer the gain for federal  income tax purposes upon the sale of
the property if the proceeds are reinvested in an additional property.

Certain Management Services

         RAI Restaurants,  Inc. (formerly known as CNL Restaurants XVIII, Inc.),
an affiliate of the General  Partners,  provides  certain  services  relating to
management  of the  Partnership  and its  Properties  pursuant  to a  management
agreement with the Partnership. CNL APF Partners, LP assigned its rights in, and
its  obligations  under,  the management  agreement with the  Partnership to RAI
Restaurants,  Inc.  ("Advisor")  effective January 1, 2002. All of the terms and
conditions of the management agreement,  including the payment of fees, remained
unchanged.  Under this  agreement,  the Advisor is  responsible  for  collecting
rental  payments,  inspecting the Properties and the tenants' books and records,
assisting the  Partnership  in responding to tenant  inquiries and notices,  and
providing  information to the Partnership about the status of the leases and the
Properties.  The Advisor also assists the General  Partners in  negotiating  the
leases.  For these  services,  the  Partnership had agreed to pay the Advisor an
annual fee of one percent of the sum of gross rental  revenues  from  Properties
wholly owned by the Partnership plus the Partnership's  allocable share of gross
revenues of joint ventures in which the Partnership is a co-venturer, but not in
excess of competitive fees for comparable services.

         The management agreement continues until the Partnership no longer owns
an interest in any Properties unless terminated at an earlier date upon 60 days'
prior notice by either party.

Competition

         The fast-food and family-style  restaurant business is characterized by
intense  competition.  The restaurants on the Partnership's  Properties  compete
with  independently  owned  restaurants,  restaurants which are part of local or
regional chains, and restaurants in other well-known national chains,  including
those offering different types of food and service.

Employees

         The  Partnership   has  no  employees.   The  officers  of  CNL  Realty
Corporation and the officers and employees of American  Properties  Fund,  Inc.,
the parent company of the Advisor, perform certain services for the Partnership.
In addition,  the General  Partners  have  available to them the  resources  and
expertise  of  the  officers  and  employees  of CNL  Financial  Group,  Inc.  a
diversified  real  estate  company,  and its  affiliates,  who may also  perform
certain services for the Partnership.


Item 2.  Properties

         As of December 31, 2002, the Partnership owned 27 Properties. Of the 27
Properties,  16 are  owned by the  Partnership  in fee  simple,  five are  owned
through joint venture  arrangements  and six are owned through tenancy in common
arrangements.  See Item 1.  Business  - Joint  Venture  and  Tenancy  in  Common
Arrangements.  The Partnership is not permitted to encumber its Properties under
the terms of its  partnership  agreement.  Reference  is made to the Schedule of
Real Estate and  Accumulated  Depreciation  for a listing of the  Properties and
their  respective  costs,  including  acquisition  fees and certain  acquisition
expenses.

Description of Properties

         Land. The Partnership's  Property sites, owned directly and indirectly,
range from  approximately  23,500 to 115,100 square feet depending upon building
size and local  demographic  factors.  Sites purchased by the Partnership are in
locations zoned for commercial use which have been reviewed for traffic patterns
and volume.


<PAGE>


         The  following  table lists the  Properties  owned by the  Partnership,
directly  and  indirectly,  as of  December  31,  2002 by state.  More  detailed
information  regarding  the  location  of the  Properties  is  contained  in the
Schedule of Real Estate and Accumulated Depreciation for the year ended December
31, 2002.

               State                                Number of Properties

               California                                     1
               Florida                                        3
               Georgia                                        1
               Illinois                                       3
               Indiana                                        2
               Maryland                                       1
               Nebraska                                       1
               North Carolina                                 1
               Ohio                                           1
               South Carolina                                 1
               Tennessee                                      2
               Texas                                          8
               Washington                                     1
               Wisconsin                                      1
                                                        --------------
               TOTAL PROPERTIES                              27
                                                        ==============

         Buildings.  Each of the Properties owned by the  Partnership,  directly
and indirectly, includes a building that is one of a Restaurant Chain's approved
designs.  The  buildings  generally are  rectangular  and are  constructed  from
various  combinations of stucco,  steel,  wood, brick and tile. The sizes of the
buildings owned by the  Partnership  ranged from  approximately  2,100 to 11,300
square  feet.  All  buildings  on  Properties  acquired by the  Partnership  are
freestanding  and surrounded by paved parking areas.  Buildings are suitable for
conversion to various uses, although  modifications may be required prior to use
for other than restaurant  operations.  As of December 31, 2002, the Partnership
had no plans for renovation of the Properties.  Depreciation expense is computed
for  buildings  and  improvements   using  the  straight  line  method  using  a
depreciable life of 40 years for federal income tax purposes.

         As of December 31, 2002, the aggregate cost of the Properties  owned by
the Partnership and joint ventures  (including  Properties owned through tenancy
in common  arrangements)  for federal  income tax purposes was  $17,341,796  and
$13,396,933, respectively.

         The  following  table lists the  Properties  owned by the  Partnership,
directly and indirectly, as of December 31, 2002 by Restaurant Chain.

                Restaurant Chain                       Number of Properties

                Arby's                                           4
                Bennigan's                                       1
                Black-eyed Pea                                   1
                Boston Market                                    1
                Burger King                                      5
                Denny's                                          1
                Fazoli's                                         1
                Golden Corral                                    4
                Jack in the Box                                  3
                Taco Bell                                        1
                Taco Cabana                                      3
                Texas Roadhouse                                  1
                Wendy's                                          1
                                                           --------------
                TOTAL PROPERTIES                                27
                                                           ==============



<PAGE>


         The General Partners consider the Properties to be well-maintained  and
sufficient for the Partnership's operations.

         The General Partners believe that the Properties are adequately covered
by  insurance.  In  addition,  the General  Partners  have  obtained  contingent
liability and property coverage for the Partnership.  This insurance is intended
to reduce the Partnership's  exposure in the unlikely event a tenant's insurance
policy lapses or is insufficient to cover a claim relating to the Property.

         Leases.  The Partnership leases the Properties to operators of selected
national and  regional  fast-food,  family-style  and casual  dining  restaurant
chains. The leases are generally on a long-term "triple net" basis, meaning that
the tenant is responsible for repairs,  maintenance,  property taxes,  utilities
and insurance.

         As of December 31, 2002, 2001, 2000, 1999, and 1998 the Properties were
100%,  96%,  92%,  93%,  and 100%  occupied,  respectively.  The  following is a
schedule of the average rent per Property for the years ended December 31:
<TABLE>
<CAPTION>

                                       2002              2001              2000             1999              1998
                                   --------------    -------------     -------------    -------------     --------------

 <c>
Rental Income(1)(2)                  $ 2,359,096      $ 2,357,917       $ 2,353,394      $ 2,667,611        $ 2,983,830
Properties(2)                                 27               26                26               29                 28
Average Rent per Property              $  87,374        $  90,689         $  90,515        $  91,987          $ 106,565
</TABLE>


(1)      Rental revenues include the Partnership's share of rental revenues from
         the  Properties  owned  through  joint  venture  and  tenancy in common
         arrangements.

(2)      Excludes  Properties  that were  vacant  at  December  31,  and did not
         generate rental revenues during the year ended December 31.

         The following is a schedule of lease expirations for leases in place as
of December 31, 2002 for each year for the next ten years and thereafter.
<TABLE>
<CAPTION>

                                                                              Percentage of
               Expiration           Number            Annual Rental             Gross Annual
                 Year               of Leases           Revenues               Rental Income
             -----------------    ----------------  -----------------    --------------------------

 <c>
              2003                    --                 $     --                      --
              2004                    --                       --                      --
              2005                    --                       --                      --
              2006                    --                       --                      --
              2007                    --                       --                      --
              2008                    --                       --                      --
              2009                    --                       --                      --
              2010                    --                       --                      --
              2011                     3                  438,398                  16.90%
              2012                     1                   44,602                   1.72%
              Thereafter              23                2,110,476                  81.38%
                                 --------        -----------------           -------------
              Total (1)               27             $  2,593,476                 100.00%
                                 ========        =================           =============
</TABLE>

         Leases  with Major  Tenants.  The terms of each of the leases  with the
Partnership's  major  tenants as of December  31,  2002 (see Item 1.  Business -
Major  Tenants),  are  substantially  the  same as  those  described  in Item 1.
Business - Leases.

         Golden Corral  Corporation leases four Golden Corral  restaurants.  The
initial  term of each lease is 15 years (three  leases  expiring in 2011 and one
lease in  2015)  and the  average  minimum  base  annual  rent is  approximately
$156,000 (ranging from approximately $107,600 to $190,000).

         National  Restaurant   Enterprises,   Inc.  leases  three  Burger  King
restaurants.  The initial term of each lease is 20 years (expiring  between 2016
and 2017) and the average  minimum  base annual rent is  approximately  $140,400
(ranging from approximately $123,200 to $153,600).

         RTM,  Inc.  leases three Arby's  Restaurants.  The initial term of each
lease is 20 years (expiring in 2016) and the average minimum base annual rent is
approximately $89,300 (ranging from approximately $86,100 to $91,900).


Item 3.  Legal Proceedings

         Neither the  Partnership,  nor its General Partners or any affiliate of
the General Partners,  nor any of their respective  Properties,  is party to, or
subject to, any material pending legal proceedings.


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

         Not applicable.

                                     PART II


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

(a)      As of March 10, 2003,  there were 1,633 holders of record of the Units.
There is no public trading market for the Units,  and it is not anticipated that
a public market for the Units will develop.  During 2002,  Limited  Partners who
wished to sell their Units may have  offered the Units for sale  pursuant to the
Partnership's  distribution reinvestment plan (the "Plan"), and Limited Partners
who wished to have their  distributions used to acquire additional Units (to the
extent Units were  available  for  purchase),  may have done so pursuant to such
Plan. The General Partners have the right to prohibit  transfers of Units.  From
inception  through  December 31, 2002,  the price paid for any Unit  transferred
pursuant to the Plan ranged from $9.14 to $9.50 per Unit. The price paid for any
Unit  transferred  other than pursuant to the Plan was subject to negotiation by
the purchaser and the selling Limited  Partner.  The Partnership will not redeem
or repurchase Units.

         The following table reflects,  for each calendar quarter, the high, low
and average sales prices for transfers of Units during 2002 and 2001, other than
pursuant to the Plan, net of commissions.
<TABLE>
<CAPTION>

                                                2002                                      2001
                                --------------------------------------    -------------------------------------
                                  High          Low          Average        High          Low         Average
                                ---------    ----------     ----------    ---------    ----------    ----------

 <c>
        First Quarter              $7.00        $ 6.00         $ 6.67       (2)           (2)           (2)
        Second Quarter              7.50          6.75           7.13        $6.70        $ 6.50        $ 6.57
        Third Quarter               7.35          6.57           7.12         6.61          6.42          6.50
        Fourth Quarter              9.30          6.84           8.07         9.57          6.10          7.84
</TABLE>

(1)      A total of 11,400 and 14,880 Units were transferred other than pursuant
         to  the  Plan  for  the  years  ended   December  31,  2002  and  2001,
         respectively.

(2)      No transfer of Units took place during the quarter  other than pursuant
         to the Plan.

         The  capital  contribution  per Unit was $10.  All cash  available  for
distribution  will be distributed to the partners  pursuant to the provisions of
the Partnership Agreement.

         For each of the years ended December 31, 2002 and 2001, the Partnership
declared cash distributions of $2,400,000 to the Limited Partners. Distributions
of $600,000  were  declared at the close of each of the  Partnership's  calendar
quarters  during 2002 and 2001 to the Limited  Partners.  These amounts  include
monthly  distributions  made in arrears  for the  Limited  Partners  electing to
receive such distributions on this basis. No amounts distributed to partners for
the years  ended  December  31, 2002 and 2001,  are  required to be or have been
treated by the  Partnership  as a return of capital for purposes of  calculating
the  Limited  Partners'  return  on their  adjusted  capital  contributions.  No
distributions have been made to the General Partners to date.

         The  Partnership  intends to  continue  to make  distributions  of cash
available  for  distribution  to the  Limited  Partners  on a  quarterly  basis,
although some Limited  Partners,  in  accordance  with their  election,  receive
monthly distributions for an annual fee.

(b)      Not applicable.


Item 6.  Selected Financial Data
<TABLE>
<CAPTION>

                                             2002            2001            2000            1999            1998
                                         --------------  --------------  --------------  -------------   -------------

 <c>
 Year ended December 31:
 Continuing Operations (2):
       Revenues (1)                        $ 1,813,187      $1,793,793     $ 1,954,295     $2,462,023      $2,633,953
       Equity in earnings of joint
          ventures                             543,978        (136,021 )       176,088        182,132         140,595
       Income from continuing
          operations (1)                     1,334,957       1,271,562         406,424      1,624,849       2,176,346

 Discontinued Operations (2):
       Revenues                                128,903         271,532         341,496        230,740         234,132
       Income (loss) from
          discontinued operations (3)          391,155        (302,366 )       266,714        214,420         217,812

 Net income                                  1,726,112         969,196         673,138      1,839,269       2,394,158

 Net income (loss) per Unit:
       Continuing operations                 $    0.45        $   0.42       $    0.13       $   0.54        $   0.73
       Discontinued operations                    0.13           (0.10 )          0.09           0.07            0.07
                                         --------------  --------------  --------------  -------------   -------------
       Total                                 $    0.58        $   0.32       $    0.22       $   0.61        $   0.80
                                         ==============  ==============  ==============  =============   =============

 Cash distributions declared               $ 2,400,000      $2,400,000     $ 2,400,000     $2,400,000     $ 2,400,000
 Cash distributions declared per
     Unit                                         0.80            0.80            0.80           0.80            0.80

 At December 31:
     Total assets                          $22,563,535     $23,194,348     $24,675,610    $26,561,963     $27,365,705
     Partners' capital                      21,838,076      22,511,964      23,942,768     25,669,630      26,230,361
</TABLE>

(1)      Income from continuing operation for the years ended December 31, 2002,
         2001, 2000 and 1999 includes $456,000, $39,576, $1,079,275 and $232,140
         from  provisions  for write-down of assets,  respectively,  and for the
         years ended  December  31,  2001 and 2000,  it  includes  $310,979  and
         $17,447  from  gain  on  sale  of  assets,  respectively.  Income  from
         continuing  operation  for the year ended  December  31, 1999  includes
         $82,914 from loss on dissolution of joint venture.

(2)      Certain  items in the  prior  year's  financial  statements  have  been
         reclassified to conform to 2002 presentation.  These  reclassifications
         had no effect on total net income.  The results of operations  relating
         to properties  that were either  disposed of or were classified as held
         for  sale  as  of  December  31,  2002  are  reported  as  discontinued
         operations.  The results of operations relating to properties that were
         identified for sale as of December 31, 2001 but sold  subsequently  are
         reported as continuing operations.

(3)      Income from  discontinued  operations  for the years ended December 31,
         2001 and  2000  includes  $465,915  and  $28,644  from  provisions  for
         write-down of assets, respectively, and for the year ended December 31,
         2002, it includes $285,677 from gain on sale of assets.

         The above selected  financial  data should be read in conjunction  with
the financial statements and related notes contained in Item 8 hereof.


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

         The  Partnership  was  organized on February  10, 1995,  to acquire for
cash,  either  directly  or  through  joint  venture  arrangements,  both  newly
constructed  and  existing  restaurant  Properties,  as well as land upon  which
restaurant  Properties  were to be  constructed,  which are leased  primarily to
operators of selected national and regional  fast-food,  family-style and casual
dining Restaurant Chains. The leases are generally  triple-net leases,  with the
lessees generally  responsible for all repairs and maintenance,  property taxes,
insurance  and  utilities.  The leases  provide for minimum  base annual  rental
amounts (payable in monthly  installments) ranging from approximately $63,000 to
$246,400. The majority of the leases provide for percentage rent, based on sales
in excess of a specified amount.  In addition,  some of the leases provide that,
commencing in specified lease years (generally the sixth lease year), the annual
base rent required under the terms of the lease will increase.

         As of December 31, 2000, 2001 and 2002, the  Partnership  owned 21, 18,
and 16 Properties  directly,  respectively.  In addition,  the Partnership owned
seven,  nine, and eleven Properties  indirectly through joint venture or tenancy
in common arrangements as of December 31, 2000, 2001 and 2002, respectively.

Capital Resources

         For the  years  ended  December  31,  2002,  2001 and  2000,  cash from
operating  activities was $2,259,664,  $1,784,443 and $1,846,222,  respectively.
The increase in cash from operating activities during 2002, as compared to 2001,
and the decrease in cash from operating  activities  during 2001, as compared to
2000, resulted from changes in the Partnership's  working capital and changes in
income and expenses.

         Other sources and uses of cash included the following  during the years
ended December 31, 2002, 2001, and 2000.

         In  January  2000,  the  Partnership  reinvested  the  majority  of the
proceeds from the  liquidating  distribution  received from the  dissolution  of
CNL/GC  El Cajon  Joint  Venture  in a  Baker's  Square  Property  in  Wilmette,
Illinois. The Partnership acquired the Property from an affiliate of the General
Partners. The affiliate had purchased and temporarily held title to the Property
in order to facilitate the acquisition of the Property by the  Partnership.  The
purchase  price paid by the  Partnership  represented  the costs incurred by the
affiliate to acquire the Property.

         In September 2000, the Partnership sold its Popeye's Property in Warner
Robins,  Georgia to a third party for a total of $609,861 and received net sales
proceeds of approximately $607,400, resulting in a gain of $17,447. In addition,
in October 2000, the Partnership  sold its Boston Market Property in Long Beach,
California, and received net sales proceeds of approximately $530,000. Since the
Partnership  recorded a provision for  write-down of assets of $353,622 for this
Property in 2000, no gain or loss was recognized on the sale.

         In January 2001, the Partnership sold its Property in Houston, Texas to
a third  party  and  received  net sales  proceeds  of  approximately  $782,700,
resulting in a gain of $4,284.  The  Partnership  used the net sales proceeds to
acquire an  interest  in CNL VII and XVII  Lincoln  Joint  Venture,  and to make
distributions to the Limited Partners.

         In April 2001, the  Partnership  reinvested the net sales proceeds from
the sales of the Properties in Warner Robins,  Georgia; Long Beach,  California,
and Houston Texas, in a joint venture arrangement,  CNL VII & XVII Lincoln Joint
Venture,  with CNL Income Fund VII, Ltd., a Florida  limited  partnership and an
affiliate of the General  Partners.  The joint venture  holds one Property.  The
joint venture  acquired  this  Property  from CNL BB Corp.,  an affiliate of the
General  Partners,  who had purchased and temporarily held title to the Property
in order to facilitate the acquisition of the Property by the joint venture. The
Partnership  contributed  approximately  $1,496,700 to the joint venture.  As of
December  31,  2002,  the  Partnership  owned an 86% interest in the profits and
losses of the joint venture.

         In June 2001, the Partnership sold the Property in Kentwood,  Michigan,
received  net sales  proceeds of  approximately  $681,200 and recorded a loss of
$38,877.  In July  2001,  the  Partnership  used a  portion  of these  net sales
proceeds  to  acquire  an  interest  in a  Property  in  Waldorf,  Maryland,  as
tenants-in-common  with CNL Income Fund VI, Ltd.  and CNL Income Fund IX,  Ltd.,
each of which is a Florida  limited  partnership and an affiliate of the General
Partners.  As of December 31, 2002, the  Partnership  contributed  approximately
$570,100 for a 25% interest in the profits and losses of the Property.

         In September  2001,  the  Partnership  sold the Property in  Inglewood,
California  to a third party for $300,000  and  received  net sales  proceeds of
approximately  $298,300.  Since the  Partnership  had  recorded a provision  for
write-down of this Property in 2001, no additional  gain or loss was  recognized
on the sale. The Partnership  used the majority of the net sales proceeds to pay
liabilities of the Partnership.

         In September 2001, the Partnership also sold its Property in El Dorado,
California  to a third party and  received net sales  proceeds of  approximately
$1,510,500,  resulting in a gain of $345,572.  In December 2001, the Partnership
reinvested the majority of net sales proceeds  received in a Property in Austin,
Texas.  The  Partnership  acquired the Property from an affiliate of the General
Partners. The affiliate had purchased and temporarily held title to the Property
in order to facilitate the acquisition of the Property by the  Partnership.  The
purchase price paid by the Partnership of approximately  $1,216,600  represented
the costs  incurred  by the  affiliate  to acquire  the  Property.  The  General
Partners  believe that the transaction,  or a portion  thereof,  relating to the
sale of the  Property  and  the  reinvestment  of the  proceeds  qualified  as a
like-kind exchange transaction for federal income tax purposes.  The Partnership
used the remaining net sales proceeds to pay liabilities of the Partnership.

         In February 2002, a tenant, Sybra, Inc., filed for bankruptcy. In 2002,
the Partnership continued to receive rental payments relating to the Property in
Zephyrhills,  Florida,  held  with an  affiliate  of the  General  Partners,  as
tenants-in-common.  In  December  2002,  Sybra,  Inc.  was  acquired  by  Triarc
Companies, Inc. and emerged from bankruptcy.  The lease relating to the Property
in Zephyrhills, Florida was affirmed.

         In March 2002, the Partnership  sold its Denny's  Property in Mesquite,
Nevada,  to a third  party and  received  net sales  proceeds  of  approximately
$771,800. Since the Partnership had recorded provisions for write-down of assets
in  prior  years  for this  Property,  no gain or loss  was  recognized  in 2002
relating to the sale.  The  provision  represented  the  difference  between the
carrying value of the Property and its estimated fair value.

         In May and June 2002, the Partnership sold its Properties in Knoxville,
Tennessee and Wilmette,  Illinois to third parties and received  total net sales
proceeds of approximately  $2,727,800 resulting in a total gain of approximately
$285,700.

         In June 2002, the Partnership  reinvested the majority of the net sales
proceeds,  it received from the sale of the  Properties in Mesquite,  Nevada and
Knoxville, Tennessee, in a Taco Cabana Property located in Houston, Texas, at an
approximate cost of approximately $1,364,200.

         In addition in June 2002, the  Partnership  reinvested a portion of the
net sales proceeds from the sale of the Property in Mesquite,  Nevada in a joint
venture  arrangement,  Katy Joint  Venture,  with CNL Income  Fund IX,  Ltd.,  a
Florida limited partnership and an affiliate of the General Partners.  The joint
venture acquired a Property in Katy,  Texas. The Partnership and CNL Income Fund
IX, Ltd.  entered into an agreement  whereby each  co-venturer will share in the
profits and losses of the Property in  proportion to its  applicable  percentage
interest. As of December 31, 2002, the Partnership had contributed approximately
$416,700 for a 40% interest in this joint venture.

         The  Partnership  and Katy Joint  Venture  acquired the  Properties  in
Houston  and  Katy,  Texas  from CNL  Funding  2001-A,  LP, a  Delaware  limited
partnership and an affiliate of the General Partners. CNL Funding 2001-A, LP had
purchased and  temporarily  held title to the  Properties in order to facilitate
the acquisition of the Properties by the Partnership and the joint venture.  The
purchase prices paid by the  Partnership  and the joint venture  represented the
costs incurred by CNL Funding  2001-A,  LP to acquire and carry the  Properties.
The  General  Partners  believe  that the  transactions,  or a portion  thereof,
relating to the sales of the  Properties  and the  reinvestment  of the proceeds
will qualify as like-kind exchange transactions for federal income tax purposes.

         In August 2002, the Partnership  reinvested the net sales proceeds from
the sale of the  Property  in  Wilmette,  Illinois  in a  Property  in  Kenosha,
Wisconsin as  tenants-in-common  with CNL Income Fund VIII, Ltd. ("CNL VIII"), a
Florida  limited  partnership  and an affiliate of the General  Partners,  at an
approximate  cost of $1,883,000.  The  Partnership  and CNL VIII entered into an
agreement  whereby  each  co-tenant  will share in the profits and losses of the
Property in proportion to its applicable percentage interest in the Property. As
of December 31, 2002, the Partnership contributed approximately $1,694,700 for a
90%  interest  in  this  Property.   The  General   Partners  believe  that  the
transactions,  or portion thereof,  relating to the sale of the Property and the
reinvestment of the net sales proceeds,  or a portion thereof, will qualify as a
like-kind exchange transaction for federal income tax purposes.

         In August 2002,  Mansfield Joint Venture, in which the Partnership owns
a 21% interest, sold its Property in Mansfield, Texas to the tenant and received
net  sales  proceeds  of  approximately   $1,011,500  resulting  in  a  gain  of
approximately $296,800. The joint venture used the proceeds from the sale of the
Property and additional  contributions  from the Partnership and CNL Income Fund
VII, Ltd., who are the general  partners of the joint venture,  of approximately
$17,000 and $63,900,  respectively,  to acquire a Property in  Arlington,  Texas
from  CNL  Net  Lease  Investors,  L.P.  ("NLI"),  at  an  approximate  cost  of
$1,089,900.  During 2002, and prior to the joint  venture's  acquisition of this
Property,  CNL Financial LP Holding, LP ("CFN"), a Delaware limited partnership,
and CNL Net Lease  Investors  GP Corp.  ("GP  Corp"),  a  Delaware  corporation,
purchased  the  limited  partner's  interest  and  general  partner's  interest,
respectively,   of  NLI.  Prior  to  this  transaction,   an  affiliate  of  the
Partnership's  General  Partners  owned a 0.1%  interest  in NLI and served as a
general partner of NLI. The original general partners of NLI waived their rights
to benefit  from this  transaction.  The  acquisition  price paid by CFN for the
limited  partner's  interest was based on the portfolio  acquisition  price. The
joint venture  acquired the Property in  Arlington,  Texas at CFN's cost and did
not pay any additional  compensation to CFN for the acquisition of the Property.
Each CNL entity is an  affiliate  of the  Partnership's  General  Partners.  The
General Partners believe that the transactions,  or portion thereof, relating to
the sale of the Property and the  reinvestment of the net sales  proceeds,  or a
portion thereof,  will qualify as a like-kind  exchange  transaction for federal
income tax purposes.

         None of the Properties owned by the Partnership,  or the joint ventures
or tenancy in common arrangements in which the Partnership owns an interest,  is
or may be encumbered. Subject to certain restrictions on borrowing, however, the
Partnership  may borrow  funds but will not encumber  any of the  Properties  in
connection  with any such  borrowing.  The  Partnership  will not borrow for the
purpose of returning capital to the Limited  Partners.  The Partnership will not
borrow  under  arrangements  that  would  make the  Limited  Partners  liable to
creditors of the Partnership. The General Partners further have represented that
they will use their  reasonable  efforts to structure  any  borrowing so that it
will not constitute  "acquisition  indebtedness" for federal income tax purposes
and also will limit the Partnership's  outstanding indebtedness to three percent
of the  aggregate  adjusted  tax  basis  of its  Properties.  In  addition,  the
Partnership  will not borrow  unless it first obtains an opinion of counsel that
such borrowing will not constitute acquisition  indebtedness.  Affiliates of the
General Partners from time to time incur certain operating expenses on behalf of
the  Partnership  for which the  Partnership  reimburses the affiliates  without
interest.

         Currently, rental income from the Partnership's Properties are invested
in  short-term  highly liquid  investments  such as demand  deposit  accounts at
commercial  banks,  money market accounts and  certificates of deposit with less
than a 90-day  maturity  date,  pending  use of such  funds  to pay  Partnership
expenses,  or to make  distributions  to partners.  At December  31,  2002,  the
Partnership had $829,739 invested in such short-term  investments as compared to
$673,924 at December 31,  2001.  The  increase in cash and cash  equivalents  at
December 31, 2002,  as compared to December 31, 2001,  was  primarily due to the
fact that approximately $297,300 in restricted cash remaining from the net sales
proceeds  relating  to the sale of its  Property in El Dorado,  California  were
released from restricted cash to cash and cash  equivalents.  As of December 31,
2002, the average  interest rate earned by the  Partnership on the rental income
deposited in demand deposit accounts at commercial banks was  approximately  one
percent  annually.  The funds  remaining at December 31, 2002,  after payment of
distributions  and other  liabilities,  will be used to invest in an  additional
Property, and to meet the Partnership's working capital needs.

Short-Term Liquidity

         The Partnership's  investment strategy of acquiring Properties for cash
and  leasing  them under  triple-net  leases to  operators  who  generally  meet
specified financial  standards  minimizes the Partnership's  operating expenses.
The General  Partners believe that the leases will continue to generate net cash
flow in excess of operating expenses.

         The Partnership's  short-term liquidity  requirements consist primarily
of the operating expenses of the Partnership.

         The General  Partners have the right,  but not the obligation,  to make
additional capital  contributions if they deem it appropriate in connection with
the operations of the Partnership.

         Due to low  operating  expenses  and  ongoing  cash flow,  the  General
Partners do not believe that  working  capital  reserves  are  necessary at this
time. In addition,  because generally all leases of the Partnership's Properties
are on a triple-net  basis, it is not anticipated  that a permanent  reserve for
maintenance and repairs is necessary at this time. To the extent,  however, that
the Partnership has insufficient  funds for such purposes,  the General Partners
will contribute to the  Partnership an aggregate  amount of up to one percent of
the offering proceeds for maintenance and repairs. The General Partners have the
right to cause the  Partnership  to maintain  reserves if, in their  discretion,
they  determine  such  reserves are required to meet the  Partnership's  working
capital needs.

         The Partnership  generally  distributes cash from operations  remaining
after the payment of the operating  expenses of the  Partnership,  to the extent
that  the  General  Partners   determine  that  such  funds  are  available  for
distribution.  Based on current and future cash from operating  activities,  the
Partnership  declared  distributions  to the Limited  Partners of $2,400,000 for
each of the years  ended  December  31,  2002,  2001 and 2000.  This  represents
distributions  of $0.80 per Unit for each of the years ended  December 31, 2002,
2001 and 2000. No distributions  were made to the General Partners for the years
ended  December 31, 2002,  2001 and 2000. No amounts  distributed to the Limited
Partners for the years ended December 31, 2002, 2001 and 2000 are required to be
or have been treated by the  Partnership  as a return of capital for purposes of
calculating   the   Limited   Partners'   return  on  their   adjusted   capital
contributions. The Partnership intends to continue to make distributions of cash
available for distribution to Limited Partners on a quarterly basis.

         During 2000, the General  Partners waived their right to receive future
distributions  from the Partnership,  including both  distributions of operating
cash flow and  distributions  of  liquidation  proceeds,  to the extent that the
cumulative amount of such distributions  would exceed the balance in the General
Partners'  capital  account as of December  31, 1999.  Accordingly,  the General
Partners were not allocated any net income and did not receive any distributions
during the years ended December 31, 2002, 2001 and 2000.

         As of December  31, 2002 and 2001,  the  Partnership  owed  $26,600 and
$11,582,  respectively,  to affiliates  for operating  expenses,  accounting and
administrative  services,  and  management  fees.  As of  March  15,  2003,  the
Partnership had reimbursed the affiliates for these amounts.  Other liabilities,
including  distributions  payable,  increased  to $698,859 at December 31, 2002,
from  $670,802 at December  31,  2001.  The general  partners  believe  that the
Partnership  has  sufficient  cash on hand to meet its current  working  capital
needs.

Long-Term Liquidity

         The  Partnership  has no long-term  debt or other  long-term  liquidity
requirements.

Critical Accounting Policies

         The  Partnership's  leases are  accounted  for under the  provisions of
Statement of Accounting Standard No. 13, "Accounting for Leases" ("FAS 13"), and
have been  accounted  for using  either the direct  financing  or the  operating
method.  FAS 13 requires  management to estimate the economic life of the leased
property,  the residual  value of the leased  property and the present  value of
minimum lease payments to be received from the tenant.  In addition,  management
assumes  that all  payments  to be  received  under its leases are  collectible.
Changes in management's  estimates or assumptions  regarding  collectibility  of
lease  payments  could  result  in a change in  accounting  for the lease at the
inception of the lease.

         The Partnership  accounts for its  unconsolidated  joint ventures using
the equity method of accounting. Under generally accepted accounting principles,
the equity method of accounting is  appropriate  for entities that are partially
owned by the  Partnership,  but for which  operations of the investee are shared
with other partners.  The  Partnership's  joint venture  agreements  require the
consent of all partners on all key  decisions  affecting  the  operations of the
underlying Property.

         Management  reviews the  Partnership's  Properties  and  investments in
unconsolidated  entities  periodically  for  impairment  at least once a year or
whenever events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable.  The assessment is based on the carrying amount
of the  Property  or  investment  at the date it is  tested  for  recoverability
compared to the sum of the estimated  future cash flows  expected to result from
its operation and sale through the expected holding period.  If an impairment is
indicated,  the  asset  is  adjusted  to its  estimated  fair  value.

         When the Partnership makes the decision to sell or commits to a plan to
sell a Property, its operating results are reported as discontinued operations.

Results of Operations

Comparison of the year ended December 31, 2002 to the year ended December 31,
2001

         Total rental  revenues were  $1,794,199 for the year ended December 31,
2002 as  compared to  $1,736,074  in the same  period in 2001.  The  increase in
rental  revenues during 2002, as compared to the same period in 2001, was due to
the fact the Partnership  reinvested the majority of the net sales proceeds from
the 2001 and 2002 sale of the  Properties  in El Dorado,  California;  Mesquite,
Nevada and Wilmette,  Illinois, in Properties in Austin and Houston,  Texas. The
increase in rental revenues during 2002, as compared to the same period in 2001,
was partially  offset by the fact that the  Partnership  sold the Property in El
Dorado, California in 2001.

         In December 2002, AmeriKing Corporation, the parent company to National
Restaurant Enterprises, Inc. which is the tenant of the Properties in Harvey and
Chicago Ridge, Illinois, filed for bankruptcy protection.  As of March 10, 2003,
the  Partnership  has  continued  receiving  rental  payments  relating to these
leases. While the tenant has neither rejected nor affirmed the leases, there can
be no assurance that they will not be rejected in the future.  The lost revenues
that would result if the tenant  rejects this lease will have an adverse  effect
on the results of operations of the  Partnership if the Partnership is unable to
lease the Property in a timely manner.

         During the years  ended  December  31, 2002 and 2001,  the  Partnership
recognized income of $543,978 and a loss of $136,021, respectively, attributable
to the net operating  results reported by joint ventures.  Net operating results
reported  by joint  ventures  were lower  during  2001,  as compared to the same
period in 2002,  because  PRG,  the tenant of the  Property  in Corpus  Christi,
Texas,  experienced financial  difficulties and ceased paying rent in 2001. As a
result,   the  Partnership  and  an  affiliate  of  the  General  Partners,   as
tenants-in-common,  in which the  Partnership  owns an approximate 27% interest,
stopped  recording rental revenues The tenancy in common also incurred  Property
related  expenses such as, legal fees,  insurance and real estate taxes relating
to  this  Property.  In  addition,   the  Partnership  and  the  affiliate,   as
tenants-in-common  of  this  Property,  recorded  during  2001 a  provision  for
write-down of assets of approximately  $356,700  relating to this Property.  The
provision  represented the difference between the carrying value of the Property
and its estimated fair value. In addition, the Partnership and the affiliate, as
tenants-in-common  of  this  Property,  recorded  during  2001 a  provision  for
write-down of assets of approximately  $327,300  relating to this Property.  The
provision  represented the difference between the carrying value of the Property
and its  estimated  fair  value.  In  October  2001,  PRG filed for  Chapter  11
bankruptcy  protection.  Since the bankruptcy  filing, the tenant resumed paying
rent. The Partnership and the affiliate, as tenants-in-common, received from PRG
the rent payments  relating to this Property  from the  bankruptcy  date through
April 2002.  During April 2002, the bankruptcy court assigned its lease to a new
tenant,  an affiliate of the General  Partners  which has  continued to pay rent
pursuant  to the  lease.  All  other  lease  terms  remained  unchanged  and are
substantially  the same as the  Partnership's  other leases.  As a result of the
assignment  relating to this Property,  the  Partnership  collected from the new
tenant $309,700 in rents not collected in 2001 from the previous tenant.

         In addition,  the  operating  results  reported by joint  ventures were
lower during 2001, as compared to the same period in 2002,  because Ocean Shores
Joint  Venture,  in which the  Partnership  owns an  approximate  31%  interest,
recorded a provision for write down of assets of approximately $781,700 in 2001.
The  provision  represented  the  difference  between the carrying  value of the
Property and its estimated fair value.  The tenant of the Property owned by this
joint venture  experienced  financial  difficulties  and vacated the Property in
April 2001.  During 2002,  the joint  venture has not recorded  rental  revenues
relating to this Property.  The joint venture will continue to pursue collection
of these past due rents and is seeking a new tenant for the Property.

         The increase in net operating results reported by joint ventures during
2002,  as  compared  to the same  period  in 2001,  was also the  result  of the
Partnership investing during 2001 and 2002 the majority of the net proceeds from
the sales of Warner Robins, Georgia; Long Beach, California; Kentwood, Michigan;
Mesquite,  Nevada;  and  Wilmette,  Illinois;  in two  joint  ventures  and  two
additional  Properties,  each as a separate tenancy in common with affiliates of
the General Partners.

         In August 2002,  Mansfield Joint Venture, in which the Partnership owns
a 21% interest,  sold the Property in Mansfield,  Texas,  and reinvested the net
sales proceeds in a Property in Arlington, Texas.

         During  the  year  ended  December  31,  2002,  three  lessees  of  the
Partnership,  Golden Corral Corporation,  National Restaurant Enterprises, Inc.,
and RTM  Indianapolis,  Inc. and RTM Southwest Texas, Inc. (which are affiliated
entities  under common  control)  (hereinafter  referred as "RTM,  Inc."),  each
contributed  more than ten percent of the  Partnership's  total rental  revenues
(including  rental revenues from the  Partnership's  share of rental income from
Properties owned by joint ventures and Properties owned with separate affiliates
of the General Partners as  tenants-in-common).  As of December 31, 2002, Golden
Corral Corporation was the lessee under leases relating to four restaurants, and
National Restaurant Enterprises,  Inc. and RTM, Inc., were each the lessee under
leases  relating  to three  restaurants.  It is  anticipated  that  based on the
minimum rental  payments  required by the leases,  these three lessees each will
continue to contribute more than ten percent of the  Partnership's  total rental
revenues in 2003. In addition,  three Restaurant Chains,  Golden Corral,  Burger
King, and Arby's,  each accounted for more than ten percent of the Partnership's
total rental revenues during the year ended December 31, 2002 (including  rental
revenues from the Partnership's  share of rental income from Properties owned by
joint  ventures and  Properties  owned with  separate  affiliates of the General
Partners as  tenants-in-common).  In 2003, it is anticipated  that each of these
three Restaurant Chains will continue to contribute more than ten percent of the
Partnership's  rental  revenues to which the  Partnership  is entitled under the
terms of the leases.  Any failure of these  lessees or  Restaurant  Chains could
have a material adverse affect on the Partnership's income if the Partnership is
not able to re-lease or sell the Properties in a timely manner.

         During the years ended December 31, 2002 and 2001, the Partnership also
earned $18,988 and $57,719,  respectively,  in interest and other income. During
2001,  interest  and other  income were higher as compared to the same period in
2002 due to the Partnership  recognizing as income the remainder of the security
deposit from a former tenant of a Property in Houston, Texas, in accordance with
the lease agreement. The tenant had rejected the lease, and the Partnership sold
the Property in January 2001. In addition, interest and other income were higher
during  2001,  as compared to the same period in 2002,  primarily  due to higher
average cash balances during 2001 pending  reinvestment in an additional  income
producing Property and payment of the liabilities of the Partnership.

         Operating expenses, including depreciation and amortization expense and
provision for write-down of assets,  were  $1,022,208 and $697,189 for the years
ended  December  31, 2002 and 2001,  respectively.  The  increase  in  operating
expenses  during  2002,  as compared to the same period in 2001,  was due to the
recording  of  provisions  for  write-down  of assets in the amount of  $456,000
relating to the Properties in Harvey and Chicago Ridge, Illinois, as a result of
AmeriKing  Corporation,  the parent company to National Restaurant  Enterprises,
Inc. which is the tenant of these Properties,  filing for bankruptcy protection,
as  described  above.  The  provision  represented  the  difference  between the
carrying value of the Properties and their estimated fair value.

         The increase in operating  expenses  during 2002 was also partially due
to an increase in depreciation expense as a result of Property  acquisitions and
the  reclassification  of the lease relating to the Property in Muncie,  Indiana
from direct  financial  leases to  operating  leases due to an  amendment to the
lease.

         The increase in operating expenses during 2002, as compared to the same
period in 2001,  was  partially  offset by a decrease in the costs  incurred for
administrative  expenses for servicing the  Partnership  and its  Properties,  a
decrease in Property  expenses such as legal fees and real estate taxes relating
to several  Properties with tenants that experienced  financial  difficulties in
2001,  and a decrease in state taxes.  The higher state taxes in 2001,  were the
result  of  changes  in tax laws of a state in which  the  Partnership  conducts
business.

         During 2001,  the  Partnership  recorded  provisions  for write-down of
assets  in the  amount  of  $39,576  relating  to  the  Property  in  Inglewood,
California. The tenant of this Property was experiencing financial difficulties.
The  provision  represented  the  difference  between the carrying  value of the
Property and its estimated fair value. In September  2001, the Partnership  sold
the Property in Inglewood,  California to a third party.  Since the  Partnership
had  previously  recorded a  provision  for  write-down  for this  Property,  no
additional  gain or loss was recognized  during 2001 relating to the sale of the
Property.

         During  2001,  the  Partnership  sold  a  Property  in  Houston,  Texas
resulting in a gain of $4,284, a Property in El Dorado,  California resulting in
a gain of $345,572 and a Property in Kentwood,  Michigan  resulting in a loss of
$38,877.

         Effective  January  1,  2002,  the  Partnership  adopted  Statement  of
Financial  Accounting Standards No. 144 (FAS 144) "Accounting for the Impairment
or Disposal of  Long-Lived  Assets." This  statement  requires that a long-lived
asset be tested for  recoverability  whenever events or changes in circumstances
indicate that its carrying amount may not be recoverable. The carrying amount of
a long-lived  asset is not recoverable if it exceeds the sum of the undiscounted
cash flows  expected  to result  from the use and  eventual  disposition  of the
asset.  The assessment is based on the carrying  amount of the asset at the date
it is tested for  recoverability.  An  impairment  loss is  recognized  when the
carrying  amount of a long-lived  asset exceeds its estimated fair value.  If an
impairment is recognized,  the adjusted carrying amount of a long-lived asset is
its new cost basis.  The statement  also requires that the results of operations
of a component of an entity that either has been disposed of or is classified as
held for sale be reported as a discontinued  operation if the disposal  activity
was initiated subsequent to the adoption of the Standard.

         During 2002, the Partnership identified and sold the Properties located
in Mesquite, Nevada; Knoxville,  Tennessee; and Wilmette, Illinois, all of which
met the criteria of this standard.  In October 2001,  Phoenix  Restaurant Group,
Inc. and its  subsidiaries,  a tenant of the  Partnership,  filed for bankruptcy
protection and rejected the lease relating to the property in Mesquite,  Nevada.
In March 2002,  the  Partnership  sold the Property to a third party.  Since the
Partnership  had recorded  provisions  for  write-down of assets of $465,915 and
$28,644  during  the  years  2001 and  2000,  respectively.  No gain or loss was
recognized in 2002 relating to the sale. In May and June 2002,  the  Partnership
sold its  properties  in Knoxville,  Tennessee  and Wilmette,  Illinois to third
parties  resulting  in a total gain of  approximately  $285,700.  The  financial
results of these  Properties were  classified as Discontinued  Operations in the
accompanying  financial statements.  The majority of the net sales proceeds from
the sales of these  Properties  were reinvested in three  Properties,  one owned
directly by the Partnership and the other two owned indirectly through a tenancy
in common and a joint venture.

         During 2002, CNL Mansfield Joint Venture, in which the Partnership owns
a 21%  interest,  identified  and sold a Property  that met the criteria of this
standard.  In August 2002,  the joint  venture  sold the property in  Mansfield,
Texas to the tenant resulting in a gain of approximately $269,800. The financial
results of this  Property  were  classified  as  Discontinued  Operations in the
condensed  financial  information for the unconsolidated  joint ventures and the
properties held as tenants-in-common  with affiliates presented in the footnotes
to the accompanying  financial statements.  The joint venture reinvested the net
sales proceeds from the sale of this Property in an additional  income producing
Property.

Comparison of the year ended December 31, 2001 to the year ended December 31,
2000

         Total rental  revenues were  $1,736,074 for the year ended December 31,
2001 as  compared to  $1,893,111  in the same  period in 2000.  The  decrease in
rental revenues during 2001, as compared to 2000, was primarily  attributable to
the sale of two  Properties  in 2001 and one  Property in 2000.  During 2001 and
2000,  the  Partnership  reinvested  in a  Property  in  Austin,  Texas and in a
Property in Wilmette, Illinois,  respectively, and recognized rental revenues of
approximately  $24,100,  which partially  offset the decrease in revenues during
2001.

         In addition,  during 2000, the  Partnership  stopped  recording  rental
revenues  relating to a Denny's  Property in Mesquite,  Nevada and a Mr. Fable's
Property in Kentwood,  Michigan  because the tenant was  experiencing  financial
difficulties.  In June 2001,  the  Partnership  sold the  Property in  Kentwood,
Michigan.   On  October  31,  2001,  Phoenix  Restaurant  Group,  Inc.  and  its
Subsidiaries  (collectively  referred to as "PRG"),  the tenant of the remaining
lease  relating  to the  Property  in  Mesquite,  Nevada,  filed for  Chapter 11
bankruptcy  protection.  As a result of the bankruptcy filing, PRG rejected this
lease. The Partnership sold the Property in Mesquite, Nevada in March 2002.

         During the years  ended  December  31, 2001 and 2000,  the  Partnership
recognized a loss of $136,021 and income of $176,088, respectively, attributable
to the net operating  results reported by joint ventures.  Net operating results
from joint  ventures  decreased  during 2001,  as compared to 2000,  because the
Partnership and an affiliate of the General Partners,  as  tenants-in-common  of
the Property in Corpus Christi,  Texas, stopped recording rental revenues due to
PRG's financial  difficulties,  as described above. In addition,  the tenancy in
common recorded a provision for write-down of assets of $356,719.  The provision
represented the difference  between the carrying value of the property,  and its
estimated fair value. The tenancy in common also incurred  approximately $58,400
in real estate taxes during 2001 relating to this Property. The Partnership owns
an  approximate  27% interest on this  Property.  In October 2001, PRG filed for
Chapter 11 bankruptcy protection, and resumed paying rent.

         Net income  earned by joint  ventures  also  decreased  during 2001, as
compared to 2000 because Ocean Shores Joint  Venture,  in which the  Partnership
owns an approximate 31%,  stopped  recording rental revenues during 2001, due to
financial  difficulties  of the tenant.  The tenant of the Property owned by the
joint  venture  ceased  operations  and vacated the  Property in April 2001.  In
addition,  during 2001, the joint venture recorded a provision for write-down of
assets of $781,741, as described above. The provision represented the difference
between the carrying value of the Property and its estimated fair value.

         The  decrease  in net  income  earned  by joint  ventures  in 2001,  as
compared to 2000, was partially offset by an increase of approximately  $123,800
during 2001 as a result of the Partnership  investing during 2001 in CNL VII and
XVII  Lincoln  Joint  Venture,  and  in a  Property  in  Waldorf,  Maryland,  as
tenants-in-common  with CNL Income  Fund VI,  Ltd.  and CNL Income Fund IX, Ltd,
each an affiliate of the General Partners.

         During the years ended December 31, 2001 and 2000, the Partnership also
earned $57,719 and $61,184, respectively, in interest and other income.

         Operating expenses, including depreciation and amortization expense and
provision for  write-down of assets,  were $697,189 and $1,741,406 for the years
ended December 31, 2001 and 2000,  respectively.  Operating expenses were higher
in 2000 because the Partnership recorded approximately  $1,079,000 in provisions
for  write-down of assets,  as described  below.  The  provisions for write-down
recorded   represented  the  difference  between  the  carrying  values  of  the
properties and their estimated fair values.

         During 2000,  the  Partnership  recorded a provision for  write-down of
assets in the amount of $35,127 relating to the Properties in Houston, Texas. In
October 1998, the tenant of this Property filed for bankruptcy, and in July 2000
rejected the lease. The Partnership sold this Property in January 2001.

         As of December  31,  2000,  the  Partnership  recorded a provision  for
write-down  of assets of $28,644  relating to the Property in Mesquite,  Nevada.
The tenant of this Property was experiencing financial difficulties. As a result
of the PRG  bankruptcy,  as of  October  2001,  the  Partnership  increased  the
provision  for  write-down  of assets by $201,002 to $229,646.  During  December
2001,  the  Partnership  increased  the  provision  for  write-down of assets by
$264,914 to $464,560.  The increase in the provision  represented the difference
between the carrying value of the Property, and the estimated net sales proceeds
from the anticipated sale of the Property. The Property sold in March 2002.

         During 2000, the Partnership also recorded provisions for write-down of
assets of $193,464 and $19,091 relating to the properties in Kentwood,  Michigan
and  Pensacola,  Florida.  The  tenant  of  these  Properties  was  experiencing
financial  difficulties.  In 2001, the Partnership sold the Property in Kentwood
Michigan,  and the  tenant  assigned  its  lease  relating  to the  Property  in
Pensacola, Florida to Denny's, Inc.

         In addition,  in 2000,  the  Partnership  increased  the  provision for
write-down of assets for the Properties in Long Beach and Inglewood,  California
by  $353,622  to  $388,573  and  by  $477,971  to  $502,664,  respectively.  The
Partnership had recorded  provisions for these  Properties  amounting to $34,951
and $24,693, respectively, during 1999 because the tenant of both Properties had
filed for  bankruptcy  in 1998 and rejected the leases in 1999.  The  additional
provisions  represented the differences  between each Properties  carrying value
and their estimated fair value. The Partnership sold the Property in Long Beach,
California in October 2000. During 2001, the Partnership increased the provision
for  write-down  of assets  for the  Property  in  Inglewood,  California  by an
additional $39,575 based on a pending sales contract.  The Partnership sold this
Property in September 2001.

         During 2000, the Partnership  incurred certain expenses,  such as legal
fees, real estate taxes,  insurance,  and maintenance relating to the Properties
in Houston,  Texas and Long Beach and Inglewood,  California,  whose leases were
rejected  by the tenant,  and the  Properties  in  Mesquite,  Nevada,  Kentwood,
Michigan and Pensacola, Florida, whose tenant was having financial difficulties.
In 2001, the lease  relating to the Property in Pensacola,  Florida was assigned
to a new tenant, and in 2002, 2001 and 2000, the Partnership sold the other five
Properties,  as described above. Therefore, the Partnership will not continue to
incur these expenses for these Properties.

         The decrease in operating  expenses  during 2001,  as compared to 2000,
was also  partially  due to a decrease in  depreciation  expense due to the fact
that the Partnership sold five Properties between 2000 and 2001. The decrease in
operating  expenses during 2001 was partially  offset by higher state taxes in a
state in which the Partnership  conducts  business and due to an increase in the
costs incurred for administrative expenses for servicing the Partnership and its
Properties, as permitted by the Partnership agreement.

         During  2000,  the  Partnership  incurred   approximately   $18,700  in
transaction costs related to the General Partners retaining  financial and legal
advisors to assist them in evaluating and  negotiating  the proposed merger with
CNL American  Properties Fund, Inc. ("APF").  In June 1999, the General Partners
and APF mutually agreed to terminate the merger.

         During 2001, the Partnership sold the Properties in Houston,  Texas and
El  Dorado,   California,   and  recorded  gains  of  $4,284  and  of  $345,572,
respectively.  The Partnership also sold the Property in Kentwood,  Michigan and
recorded a loss of $38,877. In addition,  during September 2000, the Partnership
sold the Property in Warner Robins, Georgia resulting in a gain of $17,447.

         The financial results reported as discontinued operations relate to the
Properties  located in Mesquite,  Nevada;  Knoxville,  Tennessee  and  Wilmette,
Illinois, which were sold during 2002 and met the reporting criteria of FAS 144.
During 2000,  the  Partnership  recorded a provision for write-down of assets of
$28,644 for the Property in Mesquite, Nevada because the tenant was experiencing
financial  difficulties.  During 2001, the Partnership recorded $465,915 because
the tenant  filed for  bankruptcy  and  rejected  the  lease.  The  increase  in
provisions for write-down  represented the difference between the carrying value
of the Property and its estimated fair value based on a pending sales contract.

         The  restaurant  industry  has been  relatively  resilient  during this
volatile time with steady performance during 2002. However, the industry remains
in a state of cautious optimism.  Restaurant  operators expect their business to
be better in 2003,  according to a nationwide  survey  conducted by the National
Restaurant  Association,   but  are  concerned  by  the  budget  deficits  being
experienced  by many states and the  potential  of new taxes on the  industry to
alleviate the situation.

         The  Partnership's  leases  as of  December  31,  2002,  are  generally
triple-net  leases and  contain  provisions  that the General  Partners  believe
mitigate  the adverse  effect of  inflation.  Such  provisions  include  clauses
requiring the payment of percentage rent based on certain restaurant sales above
a specified  level and/or  automatic  increases in base rent at specified  times
during the term of the lease.  Inflation,  overall,  has had a minimal effect on
results of operations of the Partnership.  Continued inflation may cause capital
appreciation of the  Partnership's  Properties.  Inflation and changing  prices,
however,  also may have an adverse impact on the sales of the restaurants and on
potential capital appreciation of the Properties.

         In January  2003,  FASB issued FASB  Interpretation  No. 46 ("FIN 46"),
"Consolidation  of Variable  Interest  Entities"  to expand upon and  strengthen
existing  accounting  guidance that  addresses when a company should include the
assets,   liabilities   and  activities  of  another  entity  in  its  financial
statements.  To improve financial  reporting by companies involved with variable
interest  entities (more  commonly  referred to as  special-purpose  entities or
off-balance sheet  structures),  FIN 46 requires that a variable interest entity
be considered by a company if that company is subject to a majority risk of loss
from the variable interest entity's activities or entitled to receive a majority
of the entity's  residual returns or both. Prior to FIN 46, a company  generally
included  another entity in its  consolidated  financial  statements  only if it
controlled  the entity  through  voting  interests.  Consolidation  of  variable
interests  entities will provide more complete  information about the resources,
obligations,   risks  and  opportunities  of  the  consolidated   company.   The
consolidation  requirements  of FIN 46 apply  immediately  to variable  interest
entities  created  after  January 31, 2003,  and to older  entities in the first
fiscal year or interim period beginning after June 15, 2003. Management believes
adoption  of this  standard  may result in either  consolidation  or  additional
disclosure  requirements with respect to the Partnership's  unconsolidated joint
ventures  or  Properties  held  with  affiliates  of  the  General  Partners  as
tenants-in-common,  which are currently  accounted for under the equity  method.
However,  such  consolidation  is  not  expected  to  significantly  impact  the
Partnership's results of operations.


<PAGE>


Item 7A. Quantitative and Qualitative Disclosures About Market Risk

         Not applicable.


Item 8.  Financial Statements and Supplementary Data


<PAGE>




                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                                    CONTENTS








                                                                      Page

Report of Independent Certified Public Accountants                     21

Financial Statements:

     Balance Sheets                                                    22

     Statements of Income                                              23

     Statements of Partners' Capital                                   24

     Statements of Cash Flows                                       25-26

     Notes to Financial Statements                                  27-42








<PAGE>









               Report of Independent Certified Public Accountants




To the Partners
CNL Income Fund XVII, Ltd.


In our opinion,  the accompanying  balance sheets and the related  statements of
income,  of partners'  capital and of cash flows present fairly, in all material
respects,  the  financial  position  of CNL Income  Fund XVII,  Ltd.  (a Florida
limited  partnership)  at  December  31,  2002 and 2001,  and the results of its
operations  and its cash flows for each of the three  years in the period  ended
December 31, 2002 in conformity with accounting principles generally accepted in
the United  States of  America.  In  addition,  in our  opinion,  the  financial
statement  schedules  listed in the index appearing under item 15(a)(2)  present
fairly, in all material respects, the information set forth therein when read in
conjunction with the related financial  statements.  These financial  statements
and  the  financial   statement   schedules  are  the   responsibility   of  the
Partnership's  management;  our responsibility is to express an opinion on these
financial  statements and the financial statement schedules based on our audits.
We  conducted  our  audits  of these  statements  in  accordance  with  auditing
standards generally accepted in the United States of America, which require that
we plan and perform the audit to obtain  reasonable  assurance about whether the
financial  statements  are free of  material  misstatement.  An  audit  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial   statements,   assessing  the  accounting  principles  used  and
significant  estimates made by management,  and evaluating the overall financial
statement  presentation.  We believe that our audits provide a reasonable  basis
for our opinion.

As  described in Note 1 to the  financial  statements,  on January 1, 2002,  the
Partnership   adopted  Statement  of  Financial   Accounting  Standard  No.  144
"Accounting for the Impairment or Disposal of Long-Lived Assets."




/s/ PricewaterhouseCoopers LLP

Orlando, Florida
January 31, 2003


<PAGE>

                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                                 BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                                          December 31,
                                                                                  2002                   2001
                                                                            -----------------      ------------------

 <c>
                          ASSETS

Real estate properties with operating leases, net                               $ 15,022,053           $  13,864,015
Net investment in direct financing leases                                            410,120                 988,429
Real estate held for sale                                                                 --               3,218,833
Investment in joint ventures                                                       5,749,285               3,658,974
Cash and cash equivalents                                                            829,739                 673,924
Restricted cash                                                                           --                 297,288
Receivables, less allowance for doubtful
     accounts of $286,567 in 2001                                                     36,516                   2,709
Due from related parties                                                                 490                  19,289
Accrued rental income                                                                502,962                 465,033
Other assets                                                                          12,370                   5,854
                                                                            -----------------      ------------------

                                                                                $ 22,563,535           $  23,194,348
                                                                            =================      ==================



            LIABILITIES AND PARTNERS' CAPITAL

Accounts payable and accrued expenses                                             $    3,494             $     8,974
Real estate taxes payable                                                             13,457                      --
Distributions payable                                                                600,000                 600,000
Due to related parties                                                                26,600                  11,582
Rents paid in advance                                                                 31,910                   8,350
Deferred rental income                                                                49,998                  53,478
                                                                            -----------------      ------------------
         Total liabilities                                                           725,459                 682,384

Partners' capital                                                                 21,838,076              22,511,964
                                                                            -----------------      ------------------

                                                                                $ 22,563,535           $  23,194,348
                                                                            =================      ==================
</TABLE>
                See accompanying notes to financial statements.

<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                              STATEMENTS OF INCOME
<TABLE>
<CAPTION>

                                                                               Year Ended December 31,
                                                                      2002               2001              2000
                                                                 ----------------   ---------------   ----------------

 <c>
 Revenues:
      Rental income from operating leases                        $     1,732,028      $  1,637,035       $  1,791,426
      Earned income from direct financing leases                          62,171            99,039            101,685
      Interest and other income                                           18,988            57,719             61,184
                                                                 ----------------   ---------------   ----------------
                                                                       1,813,187         1,793,793          1,954,295
                                                                 ----------------   ---------------   ----------------
 Expenses:
      General operating and administrative                               207,363           245,622            140,179
      Property expenses                                                    6,544            59,765            117,054
      Management fee to related party                                     24,452            21,315             22,591
      State and other taxes                                                9,258            34,733             12,064
      Depreciation and amortization                                      318,591           296,178            351,548
      Provision for write-down of assets                                 456,000            39,576          1,079,275
      Transaction costs                                                       --                --             18,695
                                                                 ----------------   ---------------   ----------------
                                                                       1,022,208           697,189          1,741,406
                                                                 ----------------   ---------------   ----------------
 Income Before Gain on Sale of Assets and Equity in
      Earnings (Loss) of Joint Ventures                                  790,979         1,096,604            212,889

 Gain on Sale of Assets                                                       --           310,979             17,447

 Equity in Earnings (Loss) of Joint Ventures                             543,978          (136,021  )         176,088
                                                                 ----------------   ---------------   ----------------

 Income from Continuing Operations                                     1,334,957         1,271,562            406,424
                                                                 ----------------   ---------------   ----------------

 Discontinued Operations (Note 5):

      Income (loss) from discontinued operations                         105,478          (302,366  )         266,714
      Gain (loss) on disposal of discontinued operations                 285,677                --                 --
                                                                 ----------------   ---------------   ----------------
                                                                         391,155          (302,366  )         266,714
                                                                 ----------------   ---------------   ----------------


 Net income                                                          $ 1,726,112       $   969,196        $   673,138
                                                                 ================   ===============   ================


 Income (Loss) Per Limited Partner Unit
      Continuing Operations                                           $     0.45        $     0.42         $     0.13
      Discontinued Operations                                               0.13             (0.10  )            0.09
                                                                 ----------------   ---------------   ----------------

      Total                                                           $     0.58        $     0.32          $    0.22
                                                                 ================   ===============   ================


 Weighted Average Number of Limited Partner Units
      Outstanding                                                      3,000,000         3,000,000          3,000,000
                                                                 ================   ===============   ================
</TABLE>
                See accompanying notes to financial statements.

<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                         STATEMENTS OF PARTNERS' CAPITAL

                  Years Ended December 31, 2002, 2001, and 2000
<TABLE>
<CAPTION>


                                                General Partners                              Limited Partners
                                        ----------------------------   -----------------------------------------------------------
                                                         Accumulated                                    Accumulated    Syndication
                                        Contributions      Earnings     Contributions   Distributions   Earnings         Costs
                                        -------------   ------------   --------------   -------------   ------------   -----------

 <c>
Balance, December 31, 1999              $     1,000     $    (5,460 )  $  30,000,000   $ (8,282,464 )   $  7,546,554   $ (3,590,000)

    Distributions to limited partners
       ($0.80 per limited partner unit)          --              --               --     (2,400,000 )             --             --
    Net income                                   --              --               --             --          673,138             --
                                        ------------   -------------   -------------- --------------   --------------  -------------

Balance, December 31, 2000                    1,000          (5,460 )     30,000,000    (10,682,464 )      8,219,692     (3,590,000)

    Distributions to limited partners
       ($0.80 per limited partner unit)          --              --               --     (2,400,000 )             --             --
    Net income                                   --              --               --             --          969,196             --
                                        ------------   -------------   -------------- --------------   --------------  -------------

Balance, December 31, 2001                    1,000          (5,460 )     30,000,000    (13,082,464 )      9,188,888     (3,590,000)

    Distributions to limited partners
       ($0.80 per limited partner unit)          --              --               --     (2,400,000 )             --             --
    Net income                                   --              --               --             --        1,726,112             --
                                        ------------   -------------   -------------- --------------   --------------  -------------

Balance, December 31, 2002              $     1,000     $    (5,460 )  $  30,000,000  $ (15,482,464 )  $  10,915,000   $ (3,590,000)
                                        ============   =============   ============== ==============   ==============  =============








     Total
--------------

    $25,669,630


     (2,400,000 )
        673,138
  --------------

     23,942,768


     (2,400,000 )
        969,196
  --------------

     22,511,964


     (2,400,000 )
      1,726,112
  --------------

    $21,838,076
  ==============
</TABLE>

                See accompanying notes to financial statements.
<page>

                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>


                                                                                      Year Ended December 31,
                                                                            2002               2001                2000
                                                                       ---------------    ----------------    ----------------

 <c>
Increase (Decrease) in Cash and Cash Equivalents:
      Cash Flows from Operating Activities:

      Net income                                                       $    1,726,112          $  969,196          $  673,138
                                                                       ---------------    ----------------    ----------------
      Adjustments to reconcile net income to net cash provided
         by operating activities:
             Depreciation                                                     330,474             342,690             391,244
             Amortization                                                       4,212               4,212               4,212
             Provision for write-down of assets                               456,000             505,491             918,692
             Equity in earnings of unconsolidated joint
                ventures, net of distributions                                 42,015             382,447             (15,970 )
             Gain on sale of assets                                          (285,677 )          (310,979 )           (17,447 )
             Decrease (increase) in receivables                               (36,626 )            26,719              13,632
             Decrease (increase) in due from related parties                   18,799             (14,396 )              (954 )
             Amortization of investment in direct financing
                leases                                                         14,085              35,649              35,011
             Decrease (increase) in accrued rental income                     (46,289 )          (118,167 )            18,396
             Decrease (increase) in other assets                               (6,516 )            12,039             (14,241 )
             Increase (decrease) in accounts payable and real
                estate taxes payable                                            7,977             (17,688 )           (62,522 )
             Increase (decrease) in due to related parties                     15,018              (2,237 )            (9,778 )
             Increase (decrease) in rents paid in advance
                and deposits                                                   23,560             (27,053 )           (83,710 )
             Decrease in deferred rental income                                (3,480 )            (3,480 )            (3,481 )
                                                                       ---------------    ----------------    ----------------
                   Total adjustments                                          533,552             815,247           1,173,084
                                                                       ---------------    ----------------    ----------------

Net Cash Provided by Operating Activities                                   2,259,664           1,784,443           1,846,222
                                                                       ---------------    ----------------    ----------------

      Cash Flows from Investing Activities:
         Additions to real estate properties with operating
             leases                                                        (1,364,194 )        (1,216,598 )        (1,630,164 )
         Proceeds from sale of real estate properties                       3,499,595           3,272,711           1,136,991
         Investment in joint ventures                                      (2,136,538 )        (2,066,846 )               (12 )
         (Increase) decrease in restricted cash                               297,288            (297,288 )                --
                                                                       ---------------    ----------------    ----------------

                Net cash provided by (used in) investing
                  activities                                                  296,151            (308,021 )          (493,185 )
                                                                       ---------------    ----------------    ----------------

      Cash Flows from Financing Activities:
         Distributions to limited partners                                 (2,400,000 )        (2,400,000 )        (2,400,000 )
                                                                       ---------------    ----------------    ----------------
                Net cash used in financing activities                      (2,400,000 )        (2,400,000 )        (2,400,000 )
                                                                       ---------------    ----------------    ----------------

Net Increase (Decrease) in Cash and Cash Equivalents                          155,815            (923,578 )        (1,046,963 )

Cash and Cash Equivalents at Beginning of Year                                673,924           1,597,502           2,644,465
                                                                       ---------------    ----------------    ----------------

Cash and Cash Equivalents at End of Year                                  $   829,739         $   673,924        $  1,597,502
                                                                       ===============    ================    ================

</TABLE>
                See accompanying notes to financial statements.
<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                      STATEMENTS OF CASH FLOWS - CONTINUED

<TABLE>
<CAPTION>

                                                                                      Year Ended December 31,
                                                                            2002               2001                2000
                                                                       ---------------    ----------------    ----------------

 <c>
Supplemental Schedule of Non-Cash Investing and
    Financing Activities:

      Distributions declared and unpaid at December 31                 $      600,000         $  600,000          $  600,000
                                                                       ===============    ================    ================


</TABLE>
                See accompanying notes to financial statements.
<PAGE>

                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2002, 2001, and 2000


1.       Significant Accounting Policies:
         -------------------------------

         Organization  and Nature of Business - CNL Income Fund XVII,  Ltd. (the
         "Partnership") is a Florida limited  partnership that was organized for
         the purpose of acquiring both newly constructed and existing restaurant
         properties,  as well as properties  upon which  restaurants  were to be
         constructed,  which are leased  primarily  to operators of national and
         regional fast-food, family-style and casual dining restaurant chains.

         The general partners of the Partnership are CNL Realty Corporation (the
         "Corporate  General  Partner"),  James M.  Seneff,  Jr.  and  Robert A.
         Bourne.  Mr.  Seneff and Mr.  Bourne are also 50%  shareholders  of the
         Corporate General Partner. The general partners have responsibility for
         managing the day-to-day operations of the Partnership.

         Real Estate and Lease  Accounting  - The  Partnership  records the real
         estate  property  acquisitions  at cost.  The  properties are leased to
         third parties  generally on a triple-net  basis,  whereby the tenant is
         generally  responsible  for  all  operating  expenses  relating  to the
         property, including property taxes, insurance, maintenance and repairs.
         During the years ended  December 31, 2002,  2001 and 2000,  the tenants
         paid directly to real estate taxing authorities $312,800, $321,200, and
         $302,500,  respectively,  in real estate taxes in  accordance  with the
         terms of their triple net leases with the Partnership.

         The leases of the  Partnership  provide for base minimum  annual rental
         payments payable in monthly installments.  In addition,  certain leases
         provide for  contingent  rental  revenues  based on the tenants'  gross
         sales in  excess  of a  specified  threshold.  The  Partnership  defers
         recognition  of  the  contingent  rental  revenues  until  the  defined
         thresholds  are met.  The leases  are  accounted  for using  either the
         direct  financing or the operating  method.  Such methods are described
         below:

                  Direct  financing  method - Leases  accounted  for  using  the
                  direct  financing  method are recorded at their net investment
                  (which at the inception of the lease generally  represents the
                  cost of the asset).  Unearned income is deferred and amortized
                  to income  over the lease  terms so as to  produce a  constant
                  periodic rate of return on the Partnership's investment in the
                  leases.  For property  leases  classified as direct  financing
                  leases,  the  building  portions  of the  majority of property
                  leases are accounted for as direct  financing leases while the
                  land  portions of these leases are  accounted for as operating
                  leases.

                  Operating  method - Real estate property leases  accounted for
                  using the  operating  method are recorded at cost,  revenue is
                  recognized as rentals are earned and  depreciation  is charged
                  to operations as incurred.  Buildings are  depreciated  on the
                  straight-line  method over their estimated  useful lives of 30
                  years.  When  scheduled  rentals  vary  during the lease term,
                  income is recognized on a straight-line basis so as to produce
                  a constant periodic rent over the lease term commencing on the
                  date the property is placed in service.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


1.       Significant Accounting Policies - Continued:
         -------------------------------------------

                  Accrued  rental  income  represents  the  aggregate  amount of
                  income  recognized  on a  straight-line  basis  in  excess  of
                  scheduled  rental  payments  to date.  In  contrast,  deferred
                  rental income  represents  the  aggregate  amount of scheduled
                  rental payments to date (including  rental payments due during
                  construction  and  prior  to  the  property  being  placed  in
                  service)  in excess of income  recognized  on a  straight-line
                  basis over the lease term  commencing on the date the property
                  is placed in service.

         Leases are  generally  for 15 to 20 years and  provide  for minimum and
         contingent rentals.  The lease options generally allow tenants to renew
         the leases for two to four successive  five-year periods subject to the
         same terms and conditions of the initial lease.  Most leases also allow
         the tenant to  purchase  the  property  at fair  market  value  after a
         specified portion of the lease has elapsed.

         When  the  properties  are  sold,  the  related  cost  and  accumulated
         depreciation  for operating  leases and the net  investment  for direct
         financing  leases,  plus any accrued rental income,  or deferred rental
         income,  are removed  from the  accounts and gains or losses from sales
         are reflected in income. The general partners of the Partnership review
         properties for impairment  whenever events or changes in  circumstances
         indicate that the carrying  amount of the assets may not be recoverable
         through   operations.   The  general  partners   determine  whether  an
         impairment  in value has occurred by  comparing  the  estimated  future
         undiscounted cash flows,  including the residual value of the property,
         with the carrying cost of the individual property.

         When the  collection  of amounts  recorded as rental or other income is
         considered  to be  doubtful,  a provision  is recorded to increase  the
         allowance for doubtful accounts. If amounts are subsequently determined
         to be  uncollectible,  the  corresponding  receivable and allowance for
         doubtful accounts are decreased accordingly.

         Investment  in  Joint  Ventures  - The  Partnership  accounts  for  its
         interests in CNL Kingston Joint Venture;  CNL Mansfield  Joint Venture;
         Ocean Shores Joint Venture;  CNL VII & XVII Lincoln Joint Venture;  and
         Katy Joint Venture; and the properties in Corpus Christi, Texas; Akron,
         Ohio;  Fayetteville,  North Carolina;  Zephyrhills,  Florida;  Waldorf,
         Maryland;  and Kenosha,  Wisconsin,  for which each property is held as
         tenants-in-common, are accounted for using the equity method since each
         joint venture agreement requires the consent of all partners on all key
         decisions affecting the operations of the underlying property.

         Cash and Cash Equivalents - The Partnership considers all highly liquid
         investments  with a maturity of three months or less when  purchased to
         be cash  equivalents.  Cash  and cash  equivalents  consist  of  demand
         deposits at commercial banks,  certificates of deposit and money market
         funds  (some  of which  are  backed  by  government  securities).  Cash
         equivalents   are  stated  at  cost  plus   accrued   interest,   which
         approximates market value.

         Cash  accounts  maintained  on  behalf  of the  Partnership  in  demand
         deposits at commercial banks,  certificates of deposit and money market
         funds may exceed federally insured levels; however, the Partnership has
         not experienced any losses in such accounts.

         Income Taxes - Under  Section 701 of the  Internal  Revenue  Code,  all
         income,  expenses and tax credit items flow through to the partners for
         tax  purposes.  Therefore,  no  provision  for federal  income taxes is
         provided in the accompanying  financial statements.  The Partnership is
         subject to certain state taxes on its income and property.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


1.       Significant Accounting Policies - Continued:
         -------------------------------------------

         Additionally,  for tax  purposes,  syndication  costs are  included  in
         Partnership equity and in the basis of each partner's  investment.  For
         financial reporting  purposes,  syndication costs represent a reduction
         of  Partnership  equity and a reduction in the basis of each  partner's
         investment.

         Use of Estimates - The general  partners of the Partnership have made a
         number of estimates and assumptions relating to the reporting of assets
         and liabilities and the disclosure of contingent assets and liabilities
         to prepare these  financial  statements in  conformity  with  generally
         accepted  accounting  principles.  The more significant areas requiring
         the use of  management  estimates  relate to the allowance for doubtful
         accounts  and future  cash flows  associated  with  long-lived  assets.
         Actual results could differ from those estimates.

         Reclassification   -  Certain  items  in  the  prior  year's  financial
         statements  have been  reclassified  to conform  to 2002  presentation,
         including a change in  presentation of the statement of cash flows from
         the  direct to the  indirect  method.  These  reclassifications  had no
         effect on partner's capital, net income or cash flows.

         Statement  of  Financial  Accounting  Standards  No. 144 ("FAS  144") -
         Effective  January  1,  2002,  the  Partnership  adopted  Statement  of
         Financial  Accounting  Standards No. 144 "Accounting for the Impairment
         or Disposal of  Long-Lived  Assets."  This  statement  requires  that a
         long-lived  asset be  tested  for  recoverability  whenever  events  or
         changes in  circumstances  indicate that its carrying amount may not be
         recoverable.   The  carrying  amount  of  a  long-lived  asset  is  not
         recoverable  if it  exceeds  the  sum of the  undiscounted  cash  flows
         expected to result from the use and eventual  disposition of the asset.
         The assessment is based on the carrying amount of the asset at the date
         it is tested for recoverability.  An impairment loss is recognized when
         the carrying  amount of a long-lived  asset exceeds its estimated  fair
         value. If an impairment is recognized,  the adjusted carrying amount of
         a long-lived  asset is its new cost basis.  The statement also requires
         that the results of  operations of a component of an entity that either
         has been disposed of or is classified as held for sale be reported as a
         discontinued   operation  if  the  disposal   activity  was   initiated
         subsequent to the adoption of the Standard.

         FASB  Interpretation  No. 46 ("FIN 46") - In January 2003,  FASB issued
         FASB  Interpretation  No. 46 ("FIN  46"),  "Consolidation  of  Variable
         Interest  Entities" to expand upon and strengthen  existing  accounting
         guidance  that  addresses  when a company  should  include  the assets,
         liabilities   and   activities  of  another  entity  in  its  financial
         statements.  To improve financial  reporting by companies involved with
         variable    interest   entities   (more   commonly   referred   to   as
         special-purpose  entities  or  off-balance  sheet  structures),  FIN 46
         requires that a variable  interest entity be considered by a company if
         that  company is subject to a majority  risk of loss from the  variable
         interest  entity's  activities or entitled to receive a majority of the
         entity's residual returns or both. Prior to FIN 46, a company generally
         included another entity in its consolidated  financial  statements only
         if it controlled the entity through voting interests.  Consolidation of
         variable  interests  entities  will provide more  complete  information
         about  the  resources,  obligations,  risks  and  opportunities  of the
         consolidated  company.  The consolidation  requirements of FIN 46 apply
         immediately  to variable  interest  entities  created after January 31,
         2003,  and to older entities in the first fiscal year or interim period
         beginning  after June 15, 2003.  Management  believes  adoption of this
         standard may result in either  consolidation  or additional  disclosure
         requirements  with respect to the  Partnership's  unconsolidated  joint
         ventures or properties held with affiliates of the general  partners as
         tenants-in-common,  which are currently  accounted for under the equity
         method.  However,  such  consolidation is not expected to significantly
         impact the Partnership's results of operations.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


2.       Real Estate Properties with Operating Leases:
         --------------------------------------------

         Real estate properties with operating leases consisted of the following
         at December 31:
<TABLE>
<CAPTION>

                                                                     2002                   2001
                                                              -------------------    -------------------

 <c>
                 Land                                              $   7,131,340          $   6,675,235
                 Buildings                                             9,647,810              8,631,497
                                                              -------------------    -------------------
                                                                      16,779,150             15,306,732
                 Less accumulated depreciation                        (1,757,097 )           (1,442,717 )
                                                              -------------------    -------------------
                                                                  $   15,022,053          $  13,864,015
                                                              ===================    ===================
</TABLE>

         During 1999,  the  Partnership  recorded a provision for  write-down of
         assets of $24,693  relating to the property in  Inglewood,  California.
         The tenant of this Property  filed for  bankruptcy in October 1998, and
         during 1999, rejected the lease relating to this Property. During 2000,
         the  Partnership  increased the provision by $477,971 to $502,664.  The
         provisions represented the difference between the carrying value of the
         Property,  at December 31, 1999 and 2000 and its estimated  fair value.
         At June 30, 2001, the Partnership increased the provision by $39,575 to
         $542,239. The adjusted provision represented the difference between the
         carrying  value  of the  property  at June 30,  2001 and the net  sales
         proceeds  anticipated to be received from the sale of the property.  In
         September 2001, the Partnership sold this property to a third party and
         received net sales proceeds of approximately  $298,300. Due to the fact
         that during second  quarter,  the  Partnership had recorded a provision
         for  write-down  of this  property,  no  additional  gain  or loss  was
         recognized in September 2001 relating to the sale of the property.

         In addition,  during 2000,  the  Partnership  recorded a provision  for
         write-down  of assets of $35,127  relating to the  property  located in
         Houston,  Texas because the tenant rejected the lease and ceased making
         rental  payments.  The tenant of this Boston Market  Property filed for
         bankruptcy in 1998. The provision  represented  the difference  between
         the carrying  value of the property and its  estimated  fair value.  In
         January 2001, the  Partnership  sold this property to a third party and
         received net sales proceeds of approximately  $782,700,  resulting in a
         gain of $4,284.

         In 2000, the Partnership  recorded a provision for write-down of assets
         in the amount of $193,464, for its Property in Kentwood,  Michigan. The
         tenant  of this  Property  defaulted  under  the terms of its lease and
         ceased restaurant operations.  The provision represented the difference
         between the carrying value of the Property at December 31, 2000 and its
         estimated fair value. In June 2001, the Partnership sold this property,
         received net sales  proceeds of  approximately  $681,200 and recorded a
         loss of $38,877.

         In September 2001, the Partnership also sold its property in El Dorado,
         California  to a  third  party  and  received  net  sales  proceeds  of
         approximately  $1,510,500 resulting in a gain of $345,572.  In December
         2001, the Partnership  reinvested  approximately  $1,216,600 of the net
         sales proceeds in a Property in Austin, Texas. The Partnership acquired
         this Property from 2001-A, LP, an affiliate of the general partners.

         In June 2002, the Partnership  reinvested the majority of the net sales
         proceeds  it  received  from the sale of the  properties  in  Mesquite,
         Nevada and Knoxville,  Tennessee,  in a Taco Cabana property located in
         Houston, Texas, at an approximate cost of approximately $1,364,200 from
         CNL Funding 2001-A, LP, an affiliate of the general partners.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


2.       Real Estate Properties with Operating Leases - Continued:
         --------------------------------------------------------

         In 2002, the Partnership  recorded  provisions for write-down of assets
         in the amount of  $456,000  relating  to the  Properties  in Harvey and
         Chicago Ridge, Illinois. In December 2002, AmeriKing  Corporation,  the
         parent company of National Restaurant Enterprises,  Inc., the tenant of
         these  Properties,  filed  for  bankruptcy  protection.  The  provision
         represented the difference between the carrying value of the Properties
         and their estimated fair value at December 31, 2002.

         The following is a schedule of the future  minimum lease payments to be
         received on noncancellable operating leases at December 31, 2002:

                     2003                              $  1,754,318
                     2004                                 1,786,254
                     2005                                 1,800,314
                     2006                                 1,821,153
                     2007                                 1,847,337
                     Thereafter                          14,537,648
                                                   -----------------

                                                       $ 23,547,024
                                                   =================

3.       Net Investment in Direct Financing Leases:
         -----------------------------------------

         The  following  lists the  components  of the net  investment in direct
         financing leases at December 31:
<TABLE>
<CAPTION>

                                                           2002             2001
                                                       -------------    --------------

 <c>
                   Minimum lease payments
                        receivable                      $   720,639      $  1,733,118
                   Estimated residual values                113,894           271,355
                   Less unearned income                    (424,413 )      (1,016,044 )
                                                       -------------
                                                                        --------------
                   Net investment in direct
                        financing leases                $   410,120       $   988,429
                                                       =============    ==============
</TABLE>

         During 2001, the Partnership  established a provision for write-down of
         assets of $111,042 for its property in Mesquite, Nevada due to the fact
         that the on October 31, 2001,  Phoenix  Restaurant  Group, Inc. and its
         Subsidiaries  (collectively  referred  to as  "PRG"),  a tenant  of the
         Partnership,  filed for Chapter 11 bankruptcy  protection  and rejected
         the lease  relating to this  property.  The provision  represented  the
         difference  between the  carrying  value of the net  investment  in the
         direct  financing  lease and its  estimated  fair value at December 31,
         2001.  The  Partnership  reclassified  the  rejected  lease from direct
         financing leases to real estate  properties with operating  leases.  No
         losses on the termination of direct financing leases were recorded.

         During 2002, one of the Partnership's  leases was amended. As a result,
         the Partnership reclassified the building portion of the property which
         was classified as a direct  financing  lease to real estate  properties
         with operating  leases. No loss on the  reclassification  of the direct
         financing lease was recorded.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


3.       Net Investment in Direct Financing Leases - Continued:
         -----------------------------------------------------

         The  following  is a schedule of future  minimum  lease  payments to be
         received on direct financing leases at December 31, 2002:

                     2003                                $   53,666
                     2004                                    53,666
                     2005                                    53,666
                     2006                                    53,666
                     2007                                    53,666
                     Thereafter                             452,309
                                                   -----------------

                                                         $  720,639
                                                   =================

4.       Investment in Joint Ventures:
         ----------------------------

         The  Partnership has interests of 21%, 60.06% and 30.94% in the profits
         and losses of CNL Mansfield  Joint Venture,  CNL Kingston Joint Venture
         and Ocean Shores Joint Venture,  respectively.  The remaining interests
         in these joint ventures are held by affiliates of the Partnership which
         have the same general partners.

         The Partnership owns properties in Fayetteville, North Carolina; Corpus
         Christi,   Texas;   Akron,   Ohio;   and   Zephyrhills,   Florida,   as
         tenants-in-common  with  affiliates  of  the  general  partners.  As of
         December 31, 2002, the Partnership  owned interests in these properties
         of 19.56%, 27.42%, 36.91% and 24%, respectively.

         In  April  2001,   the   Partnership   entered  into  a  joint  venture
         arrangement, CNL VII & XVII Lincoln Joint Venture, with CNL Income Fund
         VII,  Ltd.,  a Florida  limited  partnership  and an  affiliate  of the
         general partners,  to hold one restaurant  property.  The joint venture
         acquired this  property from CNL BB Corp.,  an affiliate of the general
         partners. The Partnership contributed  approximately  $1,496,700 to the
         joint venture to acquire the  restaurant  property.  As of December 31,
         2002, the Partnership owns an 86% interest in the profits and losses of
         the joint venture.

         In July  2001,  the  Partnership  invested  in a property  in  Waldorf,
         Maryland as  tenants-in-common  with CNL Income  Fund VI, Ltd.  and CNL
         Income Fund IX, Ltd.,  each of which are Florida  limited  partnerships
         and  affiliates of the general  partners.  As of December 31, 2002, the
         Partnership  contributed  approximately  $570,100 for a 25% interest in
         the property.

         In June 2002,  the  Partnership  reinvested  a portion of the net sales
         proceeds from the sale of the property in Mesquite,  Nevada, in a joint
         venture arrangement, Katy Joint Venture, with CNL Income Fund IX, Ltd.,
         a Florida limited partnership and an affiliate of the general partners.
         The joint venture  acquired a property in Katy,  Texas from CNL Funding
         2001-A,  LP, an affiliate of the general partners.  The Partnership and
         CNL  Income  Fund IX,  Ltd.  entered  into an  agreement  whereby  each
         co-venturer  will share in the  profits  and losses of the  property in
         proportion to its applicable  percentage  interest.  As of December 31,
         2002, the Partnership had contributed  approximately $416,700 for a 40%
         interest in this joint venture.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


4.       Investment in Joint Ventures - Continued:
         ----------------------------------------

         In August 2002, the Partnership  reinvested the net sales proceeds from
         the  sale of the  Property  in  Wilmette,  Illinois  in a  Property  in
         Kenosha, Wisconsin as tenants-in-common with CNL Income Fund VIII, Ltd.
         ("CNL VIII"),  a Florida  limited  partnership  and an affiliate of the
         general partners, at an approximate cost of $1,883,000. The Partnership
         and CNL VIII  entered into an agreement  whereby  each  co-tenant  will
         share in the profits and losses of each  property in  proportion to its
         applicable   percentage   interest.   As  of  December  31,  2002,  the
         Partnership contributed  approximately $1,694,700 for a 90% interest in
         this property.

         In August 2002,  Mansfield Joint Venture, in which the Partnership owns
         a 21% interest, sold the property in Mansfield, Texas to the tenant and
         received net sales proceeds of approximately  $1,011,500 resulting in a
         gain of  approximately  $269,800.  The joint  venture used the proceeds
         from the sale of the property  and  additional  contributions  from the
         Partnership and CNL Income Fund VII, Ltd., who are the general partners
         of  the  joint   venture,   of   approximately   $17,000  and  $63,900,
         respectively,  to acquire a property in  Arlington,  Texas from CNL Net
         Lease Investors, L.P., at an approximate cost of $1,089,900. CNL Income
         Fund VII, Ltd. and CNL Net Lease Investors,  L.P. are affiliates of the
         general partners.  The financial results for the property in Mansfield,
         Texas  are  reflected  as  Discontinued  Operations  in  the  condensed
         financial information presented below.

         CNL Mansfield Joint Venture,  CNL Kingston Joint Venture,  Ocean Shores
         Joint Venture, CNL VII & XVII Lincoln Joint Venture, Katy Joint Venture
         and  the  Partnership  and  affiliates,  as  tenants-in-common  in  six
         separate  tenancy-in-common   arrangements,  each  own  and  lease  one
         property  to  an  operator  of  national   fast-food  or   family-style
         restaurants.

         The following presents the combined,  condensed  financial  information
         for the joint  ventures and the  properties  held as  tenants-in-common
         with affiliates at:
<TABLE>
<CAPTION>

                                                                                 December 31,
                                                                            2002              2001
                                                                       ---------------   ---------------

 <c>
                  Real estate properties with operating leases, net      $ 12,026,820       $ 8,220,336
                  Real estate held for sale                                        --           745,619
                  Cash                                                         37,123           107,183
                  Receivables, less allowance for doubtful
                      accounts                                                  6,468             2,119
                  Accrued rental income                                       237,749           165,314
                  Other assets                                                    267             1,252
                  Liabilities                                                  20,858            54,184
                  Partners' capital                                        12,287,569         9,187,639


</TABLE>

<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


4.       Investment in Joint Ventures - Continued:
         ----------------------------------------
<TABLE>
<CAPTION>

                                                           2002               2001                 2000
                                                       -------------     ----------------     ---------------

 <c>
          Rental revenues                               $ 1,482,473          $   533,554          $  611,339
          Expenses                                         (263,462  )          (292,591  )          (99,787  )
          Provision for write-down of assets                     --             (980,739  )               --
                                                       -------------     ----------------     ---------------

               Income (loss) from continuing
                   operations                             1,219,011             (739,776  )          511,552
                                                       -------------     ----------------     ---------------

          Discontinued operations:
               Income from discontinued
                   operations                                55,954               71,660              71,814
               Gain on disposal of assets                   269,791                   --                  --
                                                       -------------     ----------------     ---------------
                                                            325,745               71,660              71,814
                                                       -------------     ----------------     ---------------

          Net Income (Loss)                             $ 1,544,756          $  (668,116  )       $  583,366
                                                       =============     ================     ===============
</TABLE>

         The Partnership  recognized  income totaling  $543,978 and $176,088 for
         the  years  ended  December  31,  2002 and  2000,  and a loss  totaling
         $136,021  for the year  ended  December  31,  2001,  from  these  joint
         ventures and the properties held as tenants-in-common with affiliates.

5.       Discontinued Operations:
         -----------------------

         In October 2001, Phoenix Restaurant Group, Inc. and its subsidiaries, a
         tenant of the Partnership, filed for bankruptcy protection and rejected
         the lease relating to the property in Mesquite,  Nevada. In March 2002,
         the  Partnership  sold the  property to a third party and  received net
         sales proceeds of approximately  $771,800. The Partnership had recorded
         provisions  for write-down of assets of $465,915 and $28,644 during the
         years 2001 and 2000,  respectively.  No gain or loss was  recognized in
         2002 relating to the sale.

         In May and June 2002, the Partnership sold its properties in Knoxville,
         Tennessee  and Wilmette,  Illinois to third parties and received  total
         net sales  proceeds of  approximately  $2,727,800  resulting in a total
         gain of approximately $285,700.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


5.       Discontinued Operations - Continued:
         -----------------------------------

         The   financial   results  for  these   properties   are  reflected  as
         Discontinued  Operations in the accompanying financial statements.  The
         operating results of discontinued operations are as follows:
<TABLE>
<CAPTION>

                                                                      Year Ended December 31,
                                                              2002              2001              2000
                                                          --------------    -------------     -------------

 <c>
        Rental revenues                                        $ 128,903        $ 271,352         $ 339,725
        Other income                                                  --               --             1,771
        Expenses                                                 (23,425 )       (107,803 )         (46,138 )
        Provision for write-down of assets                            --         (465,915 )         (28,644 )
        Gain on disposal of assets                               285,677               --                --
                                                          --------------    -------------     -------------

        Income (loss) from discontinued operations             $ 391,155        $(302,366 )       $ 266,714
                                                          ==============    =============     =============

</TABLE>

6.       Allocations and Distributions:
         -----------------------------

         From inception  through  December 31, 1999,  distributions  of net cash
         flow,  as  defined  in  the  limited   partnership   agreement  of  the
         Partnership,  were made 95 percent  to the  limited  partners  and five
         percent  to the  general  partners;  provided,  however,  that  for any
         particular year, the five percent of net cash flow to be distributed to
         the  general  partners  was  subordinated  to  receipt  by the  limited
         partners in that year of an eight percent noncumulative,  noncompounded
         return on their aggregate invested capital  contributions (the "Limited
         Partners" 8% Return").

         From  inception  through  December  31,  1999,  generally,  net  income
         (determined   without  regard  to  any  depreciation  and  amortization
         deductions  and  gains  and  losses  from the sale of  properties)  was
         allocated  between the limited partners and the general partners first,
         in an  amount  not to  exceed  the net  cash  flow  distributed  to the
         partners  attributable to such year in the same proportions as such net
         cash flow is  distributed;  and  thereafter,  99 percent to the limited
         partners and one percent to the general  partners.  All  deductions for
         depreciation and amortization  were allocated 99 percent to the limited
         partners and one percent to the general partners.

         From inception  through  December 31, 1999, net sales proceeds from the
         sale of a property not in liquidation of the Partnership generally were
         distributed  first to the limited  partners in an amount  sufficient to
         provide them with the return of their invested  capital  contributions,
         plus their cumulative Limited Partners' 8% Return. The general partners
         then  received  a return of their  capital  contributions  and,  to the
         extent  previously  subordinated and unpaid, a five percent interest in
         all net cash flow distributions.  Any remaining net sales proceeds were
         distributed 95 percent to the limited  partners and five percent to the
         general partners.

         Any  gain  from  the  sale of a  property,  not in  liquidation  of the
         Partnership,  was in general, allocated in the same manner as net sales
         proceeds are distributable.  Any loss was, in general, allocated first,
         on a pro rata basis to the  partners  with  positive  balances in their
         capital  accounts;  and thereafter,  95 percent to the limited partners
         and five percent to the general partners.



<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


6.       Allocations and Distributions - Continued:
         -----------------------------------------

         Generally,  net sales  proceeds from a liquidating  sale of properties,
         will be used in the following order: (i) first to pay and discharge all
         of  the  Partnership's   liabilities  to  creditors,  (ii)  second,  to
         establish  reserves that may be deemed necessary for any anticipated or
         unforeseen liabilities or obligations of the Partnership,  (iii) third,
         to pay all of the Partnership's liabilities, if any, to the general and
         limited partners,  (iv) fourth,  after allocations of net income, gains
         and/or  losses,  to distribute  to the partners  with positive  capital
         accounts  balances,  in  proportion  to such  balances,  up to  amounts
         sufficient  to  reduce  such  positive   balances  to  zero,   and  (v)
         thereafter, any funds remaining shall then be distributed 95 percent to
         the limited partners and five percent to the general partners.

         Effective  January 1, 2000, the general  partners waived their right to
         receive  future  distributions  from the  Partnership,  including  both
         distributions  of operating cash flow and  distributions of liquidation
         proceeds,   to  the  extent   that  the   cumulative   amount  of  such
         distributions would exceed the balance in the general partners' capital
         account as of December  31,  1999.  Accordingly,  for years  commencing
         January  1,  2000 and  after,  the  Partnership's  net  income  will be
         allocated entirely among the limited partners.  However,  if losses are
         allocated to the general  partners in a year, an amount of income equal
         to the sum of such losses may be allocated  to the general  partners in
         succeeding years. Accordingly,  the general partners were not allocated
         any net income and did not receive any  distributions  during the years
         ended December 31, 2002, 2001 and 2000.

         During each of the years ended  December 31, 2002,  2001, and 2000, the
         Partnership   declared   distributions   to  the  limited  partners  of
         $2,400,000.  No distributions have been made to the general partners to
         date.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


7.       Income Taxes:
         ------------

         The following is a reconciliation of net income for financial reporting
         purposes to net income for federal  income tax  purposes  for the years
         ended December 31:
<TABLE>
<CAPTION>

                                                                       2002            2001            2000
                                                                  ---------------  --------------  --------------

 <C>
          Net income for financial reporting purposes                $ 1,726,112      $  969,196      $  673,138

          Effect of timing differences relating to
             depreciation                                                 60,987          37,122          50,099

          Effect of timing differences relating to amortization               --            (848 )        (5,087 )

          Direct financing leases recorded as operating
             leases for tax reporting purposes                            14,085          35,649          35,010


          Effect of timing differences relating to equity in
             earnings of unconsolidated joint ventures                   (88,917 )       426,474            (747 )

          Deduction of transaction costs for tax reporting
             purposes                                                         --              --         (84,765 )

          Accrued rental income                                          (37,857 )      (105,700 )      (162,072 )

          Rents paid in advance                                           23,560         (14,806 )       (11,437 )

          Deferred rental income                                         (11,912 )       (15,948 )       (12,239 )

          Effect of timing differences relating to allowance
             for  doubtful accounts                                     (286,567 )        31,981         206,448

          Effect of timing differences relating to gains on
             real estate property sales                                 (618,059 )      (725,184 )      (327,494 )

          Provision for write-down of assets                             456,000         505,491       1,107,919
                                                                  ---------------  --------------  --------------

          Net income for federal income tax purposes                 $ 1,237,432     $ 1,143,427     $ 1,468,773
                                                                  ===============  ==============  ==============
</TABLE>


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


8.       Related Party Transactions:
         --------------------------

         One of the individual general partners, James M. Seneff, Jr., is one of
         the principal  shareholders of CNL Holdings,  Inc. The other individual
         general partner, Robert A. Bourne, serves as President and Treasurer of
         CNL Financial  Group,  Inc., a wholly owned subsidiary of CNL Holdings,
         Inc. CNL APF  Partners,  LP, a wholly owned  subsidiary of CNL American
         Properties Fund, Inc. ("APF") served as the Partnership's advisor until
         January 1, 2002,  when it assigned its rights and  obligations  under a
         management  agreement to RAI Restaurants,  Inc.  (formerly known as CNL
         Restaurants  XVIII,  Inc.). RAI Restaurants,  Inc. ("the Advisor") is a
         wholly owned  subsidiary of APF. The  individual  general  partners are
         stockholders and directors of APF.

         The Advisor provides services  pursuant to a management  agreement with
         the partnership. In connection therewith, the Partnership agreed to pay
         certain  Advisor  management  fees of one  percent  of the sum of gross
         revenues  from  properties  wholly  owned  by the  Partnership  and the
         Partnership's  allocable  share of gross revenues from joint  ventures.
         Any  portion  of the  Management  fee  not  paid  is  deferred  without
         interest. The Partnership incurred management fees of $24,452, $21,315,
         and $22,591,  for the years ended  December 31, 2002,  2001,  and 2000,
         respectively.

         The Advisor is also entitled to receive a deferred,  subordinated  real
         estate disposition fee, payable upon the sale of one or more properties
         based on the lesser of one-half of a competitive real estate commission
         or  three  percent  of the  sales  price  if  the  Advisor  provides  a
         substantial amount of services in connection with the sale. However, if
         the sales  proceeds are reinvested in a replacement  property,  no such
         real estate  disposition  fees will be incurred until such  replacement
         property  is sold  and the net  sales  proceeds  are  distributed.  The
         payment  of the real  estate  disposition  fee is  subordinated  to the
         receipt by the limited partners of their aggregate 8% Preferred Return,
         plus their adjusted capital  contributions.  No deferred,  subordinated
         real estate disposition fees have been incurred since inception.

         During 2001, the  Partnership  and CNL Income Fund VII, Ltd.  through a
         joint  venture  arrangement,  CNL  VII & XVII  Lincoln  Joint  Venture,
         acquired a Golden Corral  property  from CNL BB Corp.,  an affiliate of
         the general partners,  for a total cost of $1,740,374.  CNL Income Fund
         VII,  Ltd. is an affiliate of the general  partners.  CNL BB Corp.  had
         purchased  and  temporarily  held  title to this  property  in order to
         facilitate the  acquisition  of the property by the joint venture.  The
         purchase price paid by the joint venture  represents the costs incurred
         by CNL BB Corp. to acquire and carry the property.

         In  December  2001,  the  Partnership  acquired a  property  located in
         Austin,   Texas  from  CNL  Funding  2001-A,   LP,  for   approximately
         $1,216,600.  CNL  Funding  2001-A,  LP is an  affiliate  of the General
         Partners.  CNL Funding 2001-A,  LP had purchased and  temporarily  held
         title to this property in order to facilitate  the  acquisition  of the
         property by the Partnership. The purchase price paid by the Partnership
         represented the costs incurred by CNL Funding 2001-A, LP to acquire and
         carry the property.

         During  2001,   Phoenix   Restaurant  Group,  Inc.  ("PRG")  filed  for
         bankruptcy  and  rejected  one of  the  two  leases  it  had  with  the
         Partnership.  The other lease was held with an affiliate of the general
         partners, as tenants-in-common.  The Partnership owns a 27% interest in
         the tenancy in common.  In May 2002, the bankruptcy court assigned this
         lease,  relating to the property in Corpus Christi,  Texas to RAI, LLC,
         an affiliate of the general  partners.  All other lease terms  remained
         the  same.  In  connection  with  this  lease,  the  tenancy  in common
         recognized  rental revenues of  approximately  $127,800 during the year
         ended December 31, 2002. The Partnership  recognized its pro-rata share
         of  this  amount  in  equity  in  earnings  of  joint  ventures  in the
         accompanying financial statements.


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


8.       Related Party Transactions - Continued:
         --------------------------------------

         In June 2002, the  Partnership  acquired a property in Houston,  Texas,
         from CNL Funding 2001-A, LP, for approximately $1,364,200. In addition,
         in June 2002,  Katy Joint  Venture  acquired a property in Katy,  Texas
         from CNL Funding 2001-A,  LP. CNL Funding 2001-A, LP is an affiliate of
         the  general  partners.  CNL  Funding  2001-A,  LP  had  purchased  and
         temporarily  held title to the  properties in order to  facilitate  the
         acquisition of the properties by the Partnership and the Joint Venture.
         The  purchase  price  paid by the  Partnership  and the  Joint  Venture
         represented the costs incurred by CNL Funding 2001-A, LP to acquire and
         carry the properties.

         In September 2002, CNL Mansfield  Joint Venture  acquired a property in
         Arlington,  Texas from CNL Net Lease  Investors,  L.P.  ("NLI"),  at an
         approximate  cost of  $1,089,900.  During 2002,  and prior to the joint
         venture's  acquisition of this property,  CNL Financial LP Holding,  LP
         ("CFN") and CNL Net Lease Investors GP Corp. ("GP Corp")  purchased the
         limited   partner's   interest   and   general   partner's    interest,
         respectively,  of NLI. Prior to this  transaction,  an affiliate of the
         Partnership's  general partners owned a 0.1% interest in NLI and served
         as a general  partner of NLI.  The  original  general  partners  of NLI
         waived their rights to benefit from this  transaction.  The acquisition
         price paid by CFN for the limited  partner's  interest was based on the
         portfolio acquisition price. The joint venture acquired the property in
         Arlington,  Texas  at  CFN's  cost  and  did  not  pay  any  additional
         compensation  to CFN for the  acquisition  of the  property.  Each  CNL
         entity is an affiliate of the Partnership's general partners.

         During the years ended  December 31, 2002,  2001, and 2000, the Advisor
         and its affiliates provided accounting and administrative services. The
         Partnership  incurred $149,801,  $189,320,  and $77,769,  for the years
         ended  December  31,  2002,  2001,  and  2000,  respectively,  for such
         services.

         The amount due related  parties at December  31, 2002 and 2001  totaled
         $26,600 and $11,582, respectively.

9.       Concentration of Credit Risk:
         ----------------------------

         The following  schedule  presents total rental revenues from individual
         lessees,  each  representing  more than ten percent of rental  revenues
         (including the  Partnership's  share of rental  revenues from the joint
         ventures and the properties held as  tenants-in-common  with affiliates
         of the General Partners), for each of the years ended December 31:
<TABLE>
<CAPTION>

                                                                 2002               2001              2000
                                                             --------------    ---------------    -------------

 <c>
         Golden Corral Corporation                               $ 598,592          $ 555,303        $ 438,299
         National Restaurant Enterprises, Inc.                     424,696            424,696          424,696
         RTM Indianapolis and RTM Southwest
              Texas, Inc.                                          262,169            264,878              N/A
         Jack in the Box Inc. (formerly
              known as Foodmaker, Inc.) and
              Jack in the Box Eastern Division, L.P.                   N/A            324,397          349,491
</TABLE>



<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


9.       Concentration of Credit Risk - Continued:
         ----------------------------------------

         In addition, the following schedule presents total rental revenues from
         individual  restaurant chains,  each representing more than ten percent
         of  rental  revenues  (including  the  Partnership's  share  of  rental
         revenues  from  the  joint   ventures  and  the   properties   held  as
         tenants-in-common with affiliates of the General Partners), for each of
         the years ended December 31:
<TABLE>
<CAPTION>

                                                            2002               2001                2000
                                                       ---------------    ---------------     ---------------

 <c>
          Golden Corral Family Steakhouse
               Restaurants                                  $ 598,592         $  555,303          $  438,299
          Burger King                                         463,478            472,109             498,959
          Arby's                                              279,905            282,266             282,551
          Jack in the Box                                         N/A            324,397             349,491
</TABLE>

         The  information   denoted  by  N/A  indicates  that  for  each  period
         presented, the tenant or group of affiliated tenants, and the chain did
         not represent more than ten percent of the  Partnership's  total rental
         revenues.

         Although  the  Partnership's   properties  are  geographically  diverse
         throughout the United States and the  Partnership's  lessees  operate a
         variety of  restaurant  concepts,  default  by any of these  lessees or
         restaurant chains could significantly  impact the results of operations
         of the  Partnership  if the  Partnership  is not able to  re-lease  the
         properties in a timely manner.




<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


10.      Selected Quarterly Financial Data:
         ---------------------------------

         The following table presents  selected  unaudited  quarterly  financial
         data for each full quarter during the years ended December 31, 2002 and
         2001:
<TABLE>
<CAPTION>

                     2002 Quarter                    First         Second        Third         Fourth           Year
         --------------------------------------    -----------    ----------   ----------     ----------    -------------

 <c>
         Continuing Operations (1):
              Revenues                              $ 442,010      $445,408     $484,197       $441,572       $1,813,187
              Equity in earnings of joint
                  ventures                             76,861       163,822      172,098        131,197          543,978
              Income from continuing
                  operations (2)                      373,876       466,460      524,045        (29,424  )     1,334,957

         Discontinued Operations (1)
              Revenues                                 67,838        61,065           --             --          128,903
              Income from discontinued
                  operations                           52,727       338,428           --             --          391,155

         Net income (loss)                            426,603       804,888      524,045        (29,424  )     1,726,112

         Net income per limited partner unit:
              Continuing Operations                   $  0.12        $ 0.16      $  0.17          $  --         $   0.45
              Discontinued Operations                    0.02          0.11           --             --             0.13
                                                   -----------    ----------   ----------     ----------    -------------
              Total                                   $  0.14        $ 0.27      $  0.17          $  --         $   0.58
                                                   ===========    ==========   ==========     ==========    =============

           2001 Quarter                              First         Second        Third         Fourth           Year
         --------------------------------------    -----------    ----------   ----------     ----------    -------------

         Continuing Operations (1):
              Revenues                              $ 473,385      $441,692     $427,398       $451,318       $1,793,793
              Equity in earnings (loss) of
                  joint ventures                       23,148        22,512     (247,938  )      66,257         (136,021  )
              Income from continuing                  242,970       219,017      435,944        373,631        1,271,562
                  operations

         Discontinued Operations (1):
              Revenues                                 68,539        76,155       99,826         26,832          271,352
              Income (loss) from discontinued
                  operations                           57,562       (20,267  )  (121,198  )    (218,463  )      (302,366  )

         Net income                                   300,532       198,750      314,746        155,168          969,196

         Net income (loss) per limited partner unit:
             Continuing Operations:                   $  0.08       $  0.08      $  0.14        $  0.12          $  0.42
             Discontinued Operations                     0.02         (0.01  )     (0.04  )       (0.07  )         (0.10  )
                                                   -----------    ----------   ----------     ----------    -------------
                                                      $  0.10       $  0.07      $  0.10        $  0.05          $  0.32
                                                   ===========    ==========   ==========     ==========    =============
</TABLE>

         (1)      Certain  items  in the  quarterly  financial  data  have  been
                  reclassified  to  conform  to  the  2002  presentation.  These
                  reclassifications  had no  effect  on total  net  income.  The
                  results of operations  relating to properties that were either
                  disposed of or were classified as held for sale as of December
                  31,  2002 are  reported  as  discontinued  operations  for all
                  periods presented. The results



<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2002, 2001, and 2000


10.      Selected Quarterly Financial Data - Continued:
         ---------------------------------------------

                  operations  relating to properties  that were  identified  for
                  sale  as of  December  31,  2001  but  sold  subsequently  are
                  reported as continuing operations.

         (2)      In December  2002,  the  Partnership  recorded  provisions for
                  write-down of assets in the amount of $456,000 relating to the
                  Properties in Harvey and Chicago Ridge,  Illinois, as a result
                  of  AmeriKing  Corporation,  the parent  company  to  National
                  Restaurant Enterprises,  Inc., the tenant of these Properties,
                  filing for bankruptcy  protection.  The provision  represented
                  the  difference  between the carrying  value of the Properties
                  and their estimated fair value.


<PAGE>


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

         None.


                                    PART III


Item 10.  Directors and Executive Officers of the Registrant

         The General Partners of the Registrant are James M. Seneff, Jr., Robert
A.  Bourne  and CNL  Realty  Corporation,  a Florida  corporation.  The  General
Partners  manage  and  control  the  Partnership's   affairs  and  have  general
responsibility   and  the  ultimate  authority  in  all  matters  affecting  the
Partnership's  business.  The  Partnership  has  available  to it the  services,
personnel and experience of CNL American Properties Fund, Inc. ("APF"), CNL Fund
Advisors, Inc., CNL Financial Group, Inc. and their affiliates, all of which are
affiliates of the General Partners.

         James M. Seneff, Jr., age 56. Since 1971, Mr. Seneff has been active in
the  acquisition,  development,  and  management  of real estate  projects  and,
directly or through an  affiliated  entity,  has served as a general  partner or
co-venturer in over 100 real estate  ventures.  These ventures have involved the
financing,  acquisition,   construction,  and  leasing  of  restaurants,  office
buildings,  apartment  complexes,  hotels, and other real estate. Mr. Seneff has
served as Director  and  Chairman of the Board of APF, a public,  unlisted  real
estate  investment  trust,  since 1994.  Mr.  Seneff  served as Chief  Executive
Officer  of APF from 1994  through  August  1999,  and has  served  as  co-Chief
Executive  Officer of APF since  December 2000. Mr. Seneff served as Chairman of
the Board and Chief Executive Officer of CNL Fund Advisors,  Inc.,  formerly the
Partnership's advisor, until it merged with a wholly-owned  subsidiary of APF in
September  1999, and in June 2000, was re-elected to those positions of CNL Fund
Advisors, Inc. Mr. Seneff is a principal stockholder of CNL Holdings,  Inc., the
parent  company of CNL  Financial  Group,  Inc.  (formerly CNL Group,  Inc.),  a
diversified real estate company,  and has served as a Director,  Chairman of the
Board and  Chief  Executive  Officer  of CNL  Financial  Group,  Inc.  since its
formation in 1980.  CNL  Financial  Group,  Inc. is the parent  company,  either
directly or indirectly through subsidiaries,  of CNL Real Estate Services, Inc.,
CNL Capital Markets,  Inc., CNL Investment Company and CNL Securities Corp., all
of which are engaged in the  business of real estate  finance.  Mr.  Seneff also
serves as a Director,  Chairman of the Board and Chief Executive  Officer of CNL
Hospitality  Properties,  Inc., a public, unlisted real estate investment trust,
as well as, CNL  Hospitality  Corp.,  its advisor.  In addition,  he serves as a
Director,  Chairman of the Board and Chief  Executive  Officer of CNL Retirement
Properties,  Inc.,  a public,  unlisted  real  estate  investment  trust and its
advisor,  CNL  Retirement  Corp.  Since  1992,  Mr.  Seneff has also served as a
Director,  Chairman of the Board and Chief  Executive  Officer of Commercial Net
Lease Realty,  Inc., a public real estate investment trust that is listed on the
New York Stock Exchange.  Mr. Seneff has also served as a Director,  Chairman of
the Board and Chief Executive  Officer of CNL Securities  Corp.  since 1979; CNL
Investment  Company  since  1990;  and  CNL  Institutional  Advisors,   Inc.,  a
registered investment advisor for pension plans, since 1990. Mr. Seneff formerly
served  as a  Director  of First  Union  National  Bank of  Florida,  N.A.,  and
currently  serves as the  Chairman  of the Board of CNL  Bank,  an  independent,
state-chartered  commercial  bank. Mr. Seneff  previously  served on the Florida
State Commission on Ethics and is a former member and past Chairman of the State
of Florida Investment Advisory Council, which recommends to the Florida Board of
Administration  investments for various Florida employee  retirement  funds. The
Florida Board of Administration,  Florida's  principal  investment  advisory and
money  management  agency,  oversees the  investment of more than $60 billion of
retirement funds. Mr. Seneff received his degree in Business Administration from
Florida State University in 1968.

         Robert A.  Bourne,  age 55. Mr.  Bourne has  participated  as a general
partner  or  co-venturer  in over  100  real  estate  ventures  involved  in the
financing,  acquisition,   construction,  and  leasing  of  restaurants,  office
buildings,  apartment complexes,  hotels, and other real estate. Mr. Bourne is a
Director  of APF.  Mr.  Bourne  served as  President  of APF from  1994  through
February  1999. He also served as Treasurer  from  February 1999 through  August
1999  and from May  1994  through  December  1994.  He also  served  in  various
executive  positions  with CNL Fund  Advisors,  Inc.  prior to its merger with a
wholly-owned subsidiary of APF including,  President from 1994 through September
1997, and Director from 1994 through August 1999. Mr. Bourne serves as President
and  Treasurer of CNL  Financial  Group,  Inc.;  Director,  Vice Chairman of the
Board, and Treasurer , and from 1997 until June 2002 served as President, of CNL
Hospitality  Properties,  Inc., a public, unlisted real estate investment trust;
as well as, Director,  Vice Chairman of the Board, and Treasurer,  and from 1997
until June 2002 served as President,  of CNL Hospitality Corp., its advisor.  In
addition,  Mr.  Bourne  serves as  Director,  Vice  Chairman  of the Board,  and
Treasurer,  and from 1997 until June 2002 served as President, of CNL Retirement
Properties, Inc., a public, unlisted real estate investment trust; as well as, a
Director,  Vice Chairman of the Board,  and Treasurer,  and from 1997 until June
2002 served as President,  of its advisor,  CNL Retirement Corp. Mr. Bourne also
serves as a Director of CNL Bank. He has served as a Director  since 1992,  Vice
Chairman of the Board since February 1996, Secretary and Treasurer from February
1996 through  1997,  and  President  from July 1992 through  February  1996,  of
Commercial Net Lease Realty,  Inc., a public real estate investment trust listed
on the New York Stock  Exchange.  Mr. Bourne also serves as Director,  President
and Treasurer for various affiliates of CNL Financial Group, Inc. including, CNL
Investment Company, CNL Securities Corp. and CNL Institutional Advisors, Inc., a
registered  investment advisor for pension plans. Mr. Bourne began his career as
a certified public  accountant  employed by Coopers & Lybrand,  Certified Public
Accountants,  from 1971  through  1978,  where he attained  the  position of Tax
Manager in 1975.  Mr. Bourne  graduated  from Florida  State  University in 1970
where he received a B.A. in Accounting, with honors.

         Curtis B.  McWilliams,  age 47. Mr.  McWilliams  has served as Co-Chief
Executive  Officer of APF since  December  2000 and  previously  served as Chief
Executive  Officer from  September  1999  through  December  2000.  Prior to the
acquisition of CNL Fund Advisors,  Inc., Mr.  McWilliams  served as President of
APF from  February  1999 until  September  1999.  From February 1998 to February
1999, he served as Executive  Vice President of APF. Mr.  McWilliams  joined CNL
Financial  Group,  Inc. in April 1997 and served as an Executive  Vice President
from October 1997 until September 1999. In addition,  Mr.  McWilliams  served as
President  of CNL Fund  Advisors,  Inc.  and CNL  Financial  Services,  Inc.,  a
corporation  engaged in the business of real estate  financing,  from April 1997
until the  acquisition of such entities by  wholly-owned  subsidiaries of APF in
September  1999.  From  September  1983 through March 1997,  Mr.  McWilliams was
employed by Merrill  Lynch & Co. The  majority of his career at Merrill  Lynch &
Co.  was in the  Investment  Banking  division  where he  served  as a  Managing
Director.  Mr.  McWilliams  received  a  B.S.E.  in  Chemical  Engineering  from
Princeton University in 1977 and a Master of Business Administration degree with
a concentration in finance from the University of Chicago in 1983.

         Steven  D.  Shackelford,  age  39.  Mr.  Shackelford  was  promoted  to
Executive Vice President of APF in June 2000. He served as Senior Vice President
from September 1999 until his promotion in June 2000. Mr. Shackelford has served
as Chief  Financial  Officer  since January 1997 and has served as Secretary and
Treasurer of APF since September 1999. He also served as Chief Financial Officer
of CNL Fund Advisors,  Inc. from September  1996 to September  1999.  From March
1995 to July 1996, Mr.  Shackelford  was a senior manager in the national office
of Price  Waterhouse LLP where he was responsible  for advising  foreign clients
seeking to raise capital and a public listing in the United States.  From August
1992 to March  1995,  he was a  manager  in the  Paris,  France  office of Price
Waterhouse, serving several multi-national clients. Mr. Shackelford was an audit
staff and  senior  from  1986 to 1992 in the  Orlando,  Florida  office of Price
Waterhouse.  Mr.  Shackelford  received a Bachelor of Arts degree in Accounting,
with honors, and a Master of Business  Administration  degree from Florida State
University and is a certified public accountant.

Section 16(a) Beneficial Ownership Reporting Compliance

         Section  16(a) of the Exchange Act requires the General  Partners,  the
officers of the  corporate  General  Partner,  and persons who own more than ten
percent  of  a  registered  class  of  the   Partnership's   equity   securities
(collectively,  the  "Reporting  Persons"),  to file  reports of  ownership  and
changes in  ownership  on Forms 3, 4 and 5 with the SEC.  Reporting  Persons are
required by SEC regulation to furnish the  Partnership  with copies of all Forms
3, 4 and 5 that they file.

         Based  solely on the  General  Partners'  review of the  copies of such
forms the  Partnership  has  received and written  representations  from certain
Reporting  Persons  that they  were not  required  to file  Forms 5 for the last
fiscal year, the General  Partners  believe that all Reporting  Persons complied
with all filing  requirements  applicable  to them with respect to  transactions
during fiscal 2002.



<PAGE>


Item 11.  Executive Compensation

         Other than as  described in Item 13, the  Partnership  has not paid and
does not intend to pay any executive compensation to the General Partners or any
of their affiliates.  There are no compensatory plans or arrangements  regarding
termination of employment or change of control.


Item 12.  Security Ownership of Certain Beneficial Owners and Management

         As of March 10,  2003,  no person was known to the  Registrant  to be a
beneficial owner of more than five percent of the Units.

         The following table sets forth, as of March 10, 2003, the beneficial
ownership interests of the General Partners in the Registrant.
<TABLE>
<CAPTION>

                    Title of Class                           Name of Partner                 Percent of Class

 <c>
           General Partnership Interests                James M. Seneff, Jr.                           45%
                                                        Robert A. Bourne                               45%
                                                        CNL Realty Corporation                         10%
                                                                                                   --------
                                                                                                      100%
                                                                                                   ========
</TABLE>

         Neither the General  Partners,  nor any of their  affiliates,  owns any
interest in the Registrant, except as noted above.

         The Partnership does not have any equity compensation plans.




<PAGE>


Item 13.  Certain Relationships and Related Transactions

         The  table  below   summarizes  the  types,   recipients,   methods  of
computation and amounts of compensation,  fees and distributions paid or payable
by the  Partnership  to the General  Partners and their  affiliates for the year
ended  December 31, 2002,  exclusive of any  distributions  to which the General
Partners or their  affiliates  may be entitled by reason of their  purchase  and
ownership of Units.
<TABLE>
<CAPTION>

                                                                                          Amount Incurred
      Type of Compensation                                                                 For the Year
         and Recipient                         Method of Computation                  Ended December 31, 2002
---------------------------------      --------------------------------------      ------------------------------

 <c>
Reimbursement  to affiliates for       Operating  expenses are reimbursed at       Accounting    and
operating expenses                     the  lower  of  cost  or  90%  of the       admin-istrative     services:
                                       prevailing  rate at which  comparable       $149,801
                                       services  could have been obtained in
                                       the     same     geographic     area.
                                       Affiliates  of the  General  Partners
                                       from  time  to  time  incur   certain
                                       operating  expenses  on behalf of the
                                       Partnership     for     which     the
                                       Partnership       reimburses      the
                                       affiliates without interest.

Annual    management    fee   to       One  percent  of  the  sum  of  gross       $24,452
affiliates                             revenues   (excluding   noncash   and
                                       lease accounting adjustments) from
                                       Properties wholly owned by the
                                       Partnership plus the Partnership's
                                       allocable share of gross revenues of
                                       joint ventures in which the Partnership
                                       is a co-venturer. The management fee,
                                       which will not exceed competitive fees
                                       for comparable services in the same
                                       geographic area, may or may not be taken,
                                       in whole or in part as to any year, in
                                       the sole discretion of the affiliates.
                                       All of any portion of the management fee
                                       not taken as to any fiscal year shall be
                                       deferred without interest and may be
                                       taken in such other fiscal year as the
                                       affiliates shall determine.

</TABLE>



<PAGE>
<TABLE>
<CAPTION>



                                                                                          Amount Incurred
      Type of Compensation                                                                 For the Year
         and Recipient                         Method of Computation                  Ended December 31, 2002
---------------------------------      --------------------------------------      ------------------------------

 <c>
Deferred,    subordinated   real       A deferred,  subordinated real estate       $-0-
estate  disposition  fee payable       disposition  fee,  payable  upon sale
to affiliates.                         of  one  or  more  Properties,  in an
                                       amount equal to the lesser of (i)
                                       one-half of a competitive real estate
                                       commission, or (ii) three percent of the
                                       sales price of such Property or
                                       Properties. Payment of such fee shall be
                                       made only if affiliates of the General
                                       Partners provide a substantial amount of
                                       services in connection with the sale of a
                                       Property or Properties and shall be
                                       subordinated to certain minimum returns
                                       to the Limited Partners. However, if the
                                       net sales proceeds are reinvested in a
                                       replacement Property, no such real estate
                                       disposition fee will be incurred until
                                       such replacement Property is sold and the
                                       net sales proceeds are distributed.

General   Partners'    deferred,       A deferred,  subordinated share equal       $-0-
subordinated       share      of       to  five   percent   of   Partnership
Part-nership net cash flow             distributions   of  net  cash   flow,
                                       subordinated   to   certain   minimum
                                       returns to the Limited Partners.

General   Partners'    deferred,       A deferred,  subordinated share equal       $-0-
subordinated       share      of       to  five   percent   of   Partnership
Part-nership  net sales proceeds       distributions   of  such  net   sales
from  a  sale  or  sales  not in       proceeds,   subordinated  to  certain
liquidation of the Partnership         minimum   returns   to  the   Limited
                                       Partners

</TABLE>

<PAGE>

<TABLE>
<CAPTION>


                                                                                          Amount Incurred
      Type of Compensation                                                                 For the Year
         and Recipient                         Method of Computation                  Ended December 31, 2002
---------------------------------      --------------------------------------      ------------------------------

 <c>
General   Partners'   share   of       Distributions  of net sales  proceeds       $-0-
Partnership  net sales pro-ceeds       from   a    sale    or    sales    of
from  a   sale   or   sales   in       substantially      all     of     the
liquidation of the Partnership         Partnership's    assets    will    be
                                       distributed in the following order or
                                       priority: (i) first, to pay all debts and
                                       liabilities of the Partnership and to
                                       establish reserves; (ii) second, to
                                       Partners with positive capital account
                                       balances, determined after the allocation
                                       of net income, net loss, gain and loss,
                                       in proportion to such balances, up to
                                       amounts sufficient to reduce such
                                       balances to zero; and (iii) thereafter,
                                       95% to the Limited Partners and 5% to the
                                       General Partners.

</TABLE>

During  2001,  the  Partnership  and CNL Income Fund VII,  Ltd.  through a joint
venture  arrangement,  CNL VII & XVII Lincoln Joint  Venture,  acquired a Golden
Corral Property from CNL BB Corp., an affiliate of the General  Partners,  for a
total  cost of  $1,740,374.  CNL  Income  Fund VII,  Ltd.  is a Florida  limited
partnership and an affiliate of the General Partners. CNL BB Corp. had purchased
and  temporarily  held  title  to this  Property  in  order  to  facilitate  the
acquisition of the Property by the joint venture. The purchase price paid by the
joint venture represents the costs incurred by CNL BB Corp. to acquire and carry
the Property.

In December 2001, the Partnership  acquired a Property located in Austin,  Texas
from CNL Funding 2001-A, LP, for approximately  $1,216,600.  CNL Funding 2001-A,
LP is a Delaware limited  partnership and an affiliate of the General  Partners.
CNL Funding 2001-A, LP had purchased and temporarily held title to this Property
in order to facilitate the acquisition of the Property by the  Partnership.  The
purchase  price paid by the  Partnership  represented  the costs incurred by CNL
Funding 2001-A, LP to acquire and carry the Property.

During 2001,  PRG filed for bankruptcy and rejected one of the two leases it had
with the Partnership.  The other lease was held with an affiliate of the General
Partners,  as  tenants-in-common.  The  Partnership  owns a 27%  interest in the
tenancy in common.  In May 2002,  the  bankruptcy  court  assigned  this  lease,
relating to the property in Corpus  Christi,  Texas to RAI, LLC, an affiliate of
the General  Partners.  All other lease terms  remained the same.  In connection
with  this  lease,  the  tenancy  in  common   recognized   rental  revenues  of
approximately  $127,800 during the year ended December 31, 2002. The Partnership
recognized  its  pro-rata  share of this  amount in equity in  earnings of joint
ventures in the accompanying financial statements.

In June 2002, the Partnership  acquired a Property in Houston,  Texas,  from CNL
Funding 2001-A,  LP, for approximately  $1,364,200.  In addition,  in June 2002,
Katy Joint Venture  acquired a Property in Katy,  Texas from CNL Funding 2001-A,
LP. CNL Funding 2001-A, LP is an affiliate of the General Partners.  CNL Funding
2001-A,  LP had purchased and temporarily  held title to the Properties in order
to facilitate the acquisition of the Properties by the Partnership and the joint
venture.  The  purchase  price  paid by the  Partnership  and the joint  venture
represented  the costs incurred by CNL Funding  2001-A,  LP to acquire and carry
the Properties.



<PAGE>


In September 2002, CNL Mansfield Joint Venture acquired a Property in Arlington,
Texas from CNL Net Lease  Investors,  L.P.  ("NLI"),  at an approximate  cost of
$1,089,900.  During 2002, and prior to the joint  venture's  acquisition of this
Property,  CNL Financial LP Holding,  LP ("CFN") and CNL Net Lease  Investors GP
Corp. ("GP Corp") purchased the limited partner's interest and general partner's
interest,  respectively,  of NLI. Prior to this transaction, an affiliate of the
Partnership's  General  Partners  owned a 0.1%  interest  in NLI and served as a
general partner of NLI. The original general partners of NLI waived their rights
to benefit  from this  transaction.  The  acquisition  price paid by CFN for the
limited  partner's  interest was based on the portfolio  acquisition  price. The
joint venture  acquired the Property in  Arlington,  Texas at CFN's cost and did
not pay any additional  compensation to CFN for the acquisition of the Property.
Each CNL entity is an affiliate of the Partnership's General Partners.


Item 14.  Controls and Procedures

         The  General  Partners  maintain  a  set  of  disclosure  controls  and
procedures  designed to ensure that information  required to be disclosed in the
Partnership's  filings  under the  Securities  Exchange Act of 1934 is recorded,
processed,  summarized  and reported  within the time  periods  specified in the
Securities and Exchange  Commission's  rules and forms. The principal  executive
and  financial  officers of the  corporate  General  Partner have  evaluated the
Partnership's  disclosure  controls and  procedures  within 90 days prior to the
filing  of this  Annual  Report  on Form  10-K and  have  determined  that  such
disclosure controls and procedures are effective.

         Subsequent to the above evaluation,  there were no significant  changes
in internal  controls or other  factors  that could  significantly  affect these
controls,   including  any   corrective   actions  with  regard  to  significant
deficiencies and material weaknesses.

                                     PART IV


Item 15.  Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)      The following documents are filed as part of this report.

         1.  Financial Statements
<TABLE>
<CAPTION>

 <C>
                  Report of Independent Certified Public Accountants

                  Balance Sheets at December 31, 2002 and 2001

                  Statements of Income for the year ended December 31, 2002, 2001, and 2000

                  Statements of Partners' Capital for the year ended December 31, 2002, 2001 and 2000

                  Statements of Cash Flows for the year ended December 31, 2002, 2001, and 2000

                  Notes to Financial Statements

         2.  Financial Statement Schedules

                  Schedule II - Valuation and Qualifying Accounts for the years
                  ended December 31, 2002, 2001, and 2000

                  Schedule III - Real Estate and Accumulated Depreciation at December 31, 2002

                  Notes to Schedule III - Real Estate and Accumulated Depreciation at December 31, 2002

                  All other Schedules are omitted as the required information is
                  inapplicable or is presented in the financial statements or
                  notes thereto.
</TABLE>

         3.  Exhibits

                **3.1      Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund XVII,  Ltd.  (Filed as Exhibit 3.2 to
                           the Registrant's Registration Statement on Form S-11,
                           No. 33-90998, incorporated herein by reference.)

                **3.2      Amended and Restated Agreement of Limited Partnership
                           of CNL Income Fund XVII,  Ltd.  (Included  as Exhibit
                           4.2 to  Form  10-K  filed  with  the  Securities  and
                           Exchange   Commission   on  March   21,   1996,   and
                           incorporated herein by reference.)

                **4.1      Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund XVII,  Ltd.  (Included as Exhibit 3.2
                           to  Registration  Statement No.  33-90998-01  on Form
                           S-11 and incorporated herein by reference.)

                **4.2      Amended and Restated Agreement of Limited Partnership
                           of CNL Income Fund XVII,  Ltd.  (Included  as Exhibit
                           4.2 to  Form  10-K  filed  with  the  Securities  and
                           Exchange   Commission   on  March   21,   1996,   and
                           incorporated herein by reference.)

                **4.3      Form of Agreement  between CNL Income Fund XVII, Ltd.
                           and MMS Escrow and Transfer Agency,  Inc. and between
                           CNL  Income  Fund  XVIII,  Ltd.  and MMS  Escrow  and
                           Transfer  Agency,  Inc.  relating to the Distribution
                           Reinvestment  Plans  (Filed  as  Exhibit  4.4  to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **8.3      Opinion  of  Baker  &  Hostetler   regarding  certain
                           material   issues   relating   to  the   Distribution
                           Reinvestment  Plan  of CNL  Income  Fund  XVII,  Ltd.
                           (Filed as Exhibit 8.3 to  Amendment  No. Three to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **10.1     Management  Agreement  between  CNL Income Fund XVII,
                           Ltd. and CNL Fund Advisors, Inc. (Included as Exhibit
                           10.1 to Form  10-K  filed  with  the  Securities  and
                           Exchange   Commission   on  March   20,   1997,   and
                           incorporated herein by reference.)

                **10.2     Form of Joint Venture  Agreement  for Joint  Ventures
                           with Unaffiliated  Entities (Filed as Exhibit 10.2 to
                           the Registrant's Registration Statement on Form S-11,
                           No. 33-90998, incorporated herein by reference.)

                **10.3     Assignment  of  Management  Agreement  from  CNL Fund
                           Advisors, Inc. to CNL APF Partners, LP. (Including as
                           Exhibit  10.2 to Form 10-Q filed with the  Securities
                           and  Exchange  Commission  on August  13,  2001,  and
                           incorporated herein by reference.)

                **10.4     Form of Joint Venture  Agreement  for Joint  Ventures
                           with  Affiliated  Programs  (Filed as Exhibit 10.3 to
                           the Registrant's Registration Statement on Form S-11,
                           No. 33-90998, incorporated herein by reference.)

                **10.5     Form of Development  Agreement (Filed as Exhibit 10.5
                           to the  Registrant's  Registration  Statement on Form
                           S-11,   No.   33-90998,    incorporated   herein   by
                           reference.)

                **10.6     Form of  Indemnification  and Put Agreement (Filed as
                           Exhibit   10.6  to  the   Registrant's   Registration
                           Statement on Form S-11,  No.  33-90998,  incorporated
                           herein by reference.)

                **10.7     Form  of  Unconditional   Guarantee  of  Payment  and
                           Performance   (Filed   as   Exhibit   10.7   to   the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **10.8     Form  of  Lease  Agreement  for  Existing  Restaurant
                           (Filed   as   Exhibit   10.8   to  the   Registrant's
                           Registration  Statement on Form S-11,  No.  33-90998,
                           incorporated herein by reference.)

                **10.9     Form  of  Lease   Agreement  for   Restaurant  to  be
                           Constructed   (Filed   as   Exhibit   10.9   to   the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **10.10    Form of Premises  Lease for Golden Corral  Restaurant
                           (Filed   as   Exhibit   10.10  to  the   Registrant's
                           Registration  Statement on Form S-11,  No.  33-90998,
                           incorporated herein by reference.)

                **10.11    Form of Agreement  between CNL Income Fund XVII, Ltd.
                           and MMS Escrow and Transfer Agency,  Inc. and between
                           CNL  Income  Fund  XVIII,  Ltd.  and MMS  Escrow  and
                           Transfer  Agency,  Inc.  relating to the Distribution
                           Reinvestment  Plans  (Filed  as  Exhibit  4.4  to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **10.12    Form of Cotenancy  Agreement with Unaffiliated Entity
                           (Filed as Exhibit  10.12 to Amendment  No. One to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **10.13    Form of Cotenancy  Agreement with  Affiliated  Entity
                           (Filed as Exhibit  10.13 to Amendment  No. One to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **10.14    Form of Registered  Investor Advisor Agreement (Filed
                           as  Exhibit   10.14  to  Amendment  No.  One  to  the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

                **10.15    Assignment  of  Management  Agreement  from  CNL  APF
                           Partners, LP to CNL Restaurants XVIII, Inc. (Included
                           as  Exhibit   10.15  to  Form  10-Q  filed  with  the
                           Securities  and  Exchange  Commission  on August  14,
                           2002, and incorporated herein be reference.)

                  99.1     Certification of Chief Executive Officer of Corporate
                           General Partner Pursuant to 18 U.S.C. Section 1350 as
                           Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                           Act of 2002. (Filed herewith.)

                  99.2     Certification of Chief Financial Officer of Corporate
                           General Partner Pursuant to 18 U.S.C. Section 1350 as
                           Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                           Act of 2002. (Filed herewith.)

         (b)      The Registrant  filed no reports on Form 8-K during the period
                  October 1, 2002 through December 31, 2002.

         (c)      Not applicable.

         (d)      Other Financial Information.

                  The   Partnership  is  required  to  file  audited   financial
                  information of one of its tenants (Golden Corral  Corporation)
                  as a result of this tenant leasing more than 20 percent of the
                  Partnership's  total  assets for the year ended  December  31,
                  2002. Golden Corral  Corporation is a privately-held  company,
                  and  its  financial   information  is  not  available  to  the
                  Partnership to include in this filing.  The  Partnership  will
                  file this financial  information  under cover of a Form 10-K/A
                  as soon as it is available.

         **previously filed


<PAGE>






                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the  undersigned,  thereunto duly  authorized,  on the 25th day of
March, 2003.

                                             CNL INCOME FUND XVII, LTD.

                                             By:CNL REALTY CORPORATION
                                                General Partner

                                                /s/ Robert A. Bourne
                                                ---------------------------
                                                ROBERT A. BOURNE, President


                                             By:ROBERT A. BOURNE
                                                General Partner

                                                /s/ Robert A. Bourne
                                                ---------------------------
                                                ROBERT A. BOURNE


                                             By:JAMES M. SENEFF, JR.
                                                General Partner

                                                /s/ James M. Seneff, Jr.
                                                ---------------------------
                                                JAMES M. SENEFF, JR.



<PAGE>





         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.
<TABLE>
<CAPTION>

               Signature                                  Title                                  Date


 <c>

/s/ Robert A. Bourne                     President,   Treasurer   and   Director            March 25, 2003
------------------------------------     (Principal   Financial  and  Accounting
Robert A. Bourne                         Officer)


/s/ James M. Seneff, Jr.                 Chief  Executive  Officer and  Director            March 25, 2003
------------------------------------     (Principal Executive Officer)
James M. Seneff, Jr.


</TABLE>


<PAGE>



                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                          OF CORPORATE GENERAL PARTNER

                 PURSUANT TO RULE 13a-14 AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


         I, James M.  Seneff,  Jr.,  the Chief  Executive  Officer of CNL Realty
Corporation,  the corporate  general  partner of CNL Income Fund XVII, Ltd. (the
"registrant"), certify that:

         1. I have reviewed this annual report on Form 10-K of the registrant;

         2. Based on my  knowledge,  this  annual  report  does not  contain any
            untrue statement of a material fact or omit to state a material fact
            necessary to make the statements made, in light of the circumstances
            under which such  statements  were made, not misleading with respect
            to the period covered by this annual report;

         3. Based on my knowledge, the financial statements, and other financial
            information  included in this annual  report,  fairly present in all
            material respects the financial condition, results of operations and
            cash flows of the  registrant as of, and for, the periods  presented
            in this annual report;

         4. The registrant's  other certifying officer and I are responsible for
            establishing and maintaining  disclosure controls and procedures (as
            defined in Exchange Act Rules 13a-14 and 15d-14) for the  registrant
            and have:

                a.  designed such  disclosure  controls and procedures to ensure
                    that  material   information  relating  to  the  registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others  within those  entities,  particularly  during the
                    period in which this annual report is being prepared;

                b.  evaluated the  effectiveness of the registrant's  disclosure
                    controls and procedures as of a date within 90 days prior to
                    the  filing  date of this  annual  report  (the  "Evaluation
                    Date"); and

                c.  presented in this annual  report our  conclusions  about the
                    effectiveness  of the  disclosure  controls  and  procedures
                    based on our evaluation as of the Evaluation Date;

         5. The  registrant's  other  certifying  officer and I have  disclosed,
            based on our most recent  evaluation,  to the registrant's  auditors
            and the audit  committee  of  registrant's  board of  directors  (or
            persons  performing the equivalent  functions):

                a.  all  significant  deficiencies in the design or operation of
                    internal   controls   which  could   adversely   affect  the
                    registrant's  ability  to  record,  process,  summarize  and
                    report   financial   data  and  have   identified   for  the
                    registrant's  auditors any material  weaknesses  in internal
                    controls; and

                b.  any fraud, whether or not material, that involves management
                    or  other  employees  who  have a  significant  role  in the
                    registrant's internal controls; and

         6. The registrant's  other  certifying  officer and I have indicated in
            this annual report whether or not there were significant  changes in
            internal  controls  or in other  factors  that  could  significantly
            affect internal  controls  subsequent to the date of our most recent
            evaluation,   including  any  corrective   actions  with  regard  to
            significant deficiencies and material weaknesses.

Date:  March 25, 2003


/s/ James M. Seneff, Jr.
---------------------------
 James M. Seneff, Jr.
Chief Executive Officer


<PAGE>


                    CERTIFICATION OF CHIEF FINANCIAL OFFICER
                          OF CORPORATE GENERAL PARTNER

                 PURSUANT TO RULE 13a-14 AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

         I, Robert A. Bourne, President and Treasurer of CNL Realty Corporation,
the corporate  general partner of CNL Income Fund XVII, Ltd. (the  "registrant")
certify that:

         1. I have reviewed this annual report on Form 10-K of the registrant;

         2. Based on my  knowledge,  this  annual  report  does not  contain any
            untrue statement of a material fact or omit to state a material fact
            necessary to make the statements made, in light of the circumstances
            under which such  statements  were made, not misleading with respect
            to the period covered by this annual report;

         3. Based on my knowledge, the financial statements, and other financial
            information  included in this annual  report,  fairly present in all
            material respects the financial condition, results of operations and
            cash flows of the  registrant as of, and for, the periods  presented
            in this annual report;

         4. The registrant's  other certifying officer and I are responsible for
            establishing and maintaining  disclosure controls and procedures (as
            defined in Exchange Act Rules 13a-14 and 15d-14) for the  registrant
            and have:

                a.  designed such  disclosure  controls and procedures to ensure
                    that  material   information  relating  to  the  registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others  within those  entities,  particularly  during the
                    period in which this annual report is being prepared;

                b.  evaluated the  effectiveness of the registrant's  disclosure
                    controls and procedures as of a date within 90 days prior to
                    the  filing  date of this  annual  report  (the  "Evaluation
                    Date"); and

                c.  presented in this annual  report our  conclusions  about the
                    effectiveness  of the  disclosure  controls  and  procedures
                    based on our evaluation as of the Evaluation Date;

         5. The  registrant's  other  certifying  officer and I have  disclosed,
            based on our most recent  evaluation,  to the registrant's  auditors
            and the audit  committee  of  registrant's  board of  directors  (or
            persons performing the equivalent functions):

                a.  all  significant  deficiencies in the design or operation of
                    internal   controls   which  could   adversely   affect  the
                    registrant's  ability  to  record,  process,  summarize  and
                    report   financial   data  and  have   identified   for  the
                    registrant's  auditors any material  weaknesses  in internal
                    controls; and

                b.  any fraud, whether or not material, that involves management
                    or  other  employees  who  have a  significant  role  in the
                    registrant's internal controls; and

         6. The registrant's  other  certifying  officer and I have indicated in
            this annual report whether or not there were significant  changes in
            internal  controls  or in other  factors  that  could  significantly
            affect internal  controls  subsequent to the date of our most recent
            evaluation,   including  any  corrective   actions  with  regard  to
            significant deficiencies and material weaknesses.


Date:  March 25, 2003


/s/ Robert A. Bourne
---------------------------
Robert A. Bourne
President and Treasurer


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                  Years Ended December 31, 2002, 2001, and 2000

<TABLE>
<CAPTION>

                                                      Additions                           Deductions
                                          ----------------------------------      ----------------------------
                                                                                                          Collected
                                                                                                          or Deter-
                                   Balance at       Charged to       Charged to          Deemed           mined to       Balance
                                    Beginning       Costs and           Other           Uncollec-          be Col-       at End
  Year          Description          of Year         Expenses         Accounts            tible           lectible       of Year
----------    -----------------   --------------  ---------------  ----------------    ------------      ------------  ------------

 <C>
  2000        Allowance for
                  doubtful
                  accounts (a)        $  48,138       $   35,807        $  249,776 (b)    $  3,966 (c)      $ 27,434     $ 302,321
                                  ==============  ===============  ================    ============      ============  ============

  2001        Allowance for
                  doubtful
                  accounts (a)        $ 302,321       $   24,589        $  209,629 (b)   $ 249,972 (c)        $   --     $ 286,567
                                  ==============  ===============  ================    ============      ============  ============

  2002        Allowance for
                  doubtful
                  accounts (a)        $ 286,567          $    --           $    --       $(286,567 )(c)       $   --        $   --
                                  ==============  ===============  ================    ============      ============  ============

</TABLE>

        (a)    Deducted from receivables and accrued rental income.

        (b)    Reduction of rental, earned and other income.

        (c)    Amounts written off as uncollectible.

<page>



                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

             SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

                                December 31, 2002
<TABLE>
<CAPTION>

 <c>
                                                                           Costs Capitalized
                                                                           Subsequent to
                                                   Initial Cost            Acquisition
                                        ------------------------  ------------------
                           Encum-                    Buildings andImprove-   Carrying
                           brances         Land       Improvements ments     Costs
                                        -----------  ----------------------  -------
Properties the Partnership
  has Invested in Under
  Under Operating Leases:

    Arby's Restaurants:
      Muncie, Indiana (m)     -           $242,759     $564,223          -        -
      Schertz, Texas          -            348,245      470,577          -        -
      Plainfield, Indiana     -            296,025      557,809          -        -

    Burger King Restaurants:
      Harvey, Illinois (n)    -            489,341      734,010          -
      Chicago Ridge, Illinois -o)          771,965            -    699,556        -
      Lyons, Illinois         -            887,767            -    597,381        -

    Denny's Restaurants:
      Pensacola, Florida      -            305,509      670,990          -        -

    Fazoli's Restaurant:
      Warner Robins, Georgia  -            300,482            -    421,898        -

    Golden Corral Family
      Steakhouse Restaurants:
          Orange Park, Florida-            711,838    1,162,406          -        -
          Aiken, South Carolin- (g)        508,790            -    862,571        -
          Weatherford, Texas (-)           345,926            -    691,222        -

    Jack in the Box Restaurants:
      Dinuba, California      -            324,970            -    509,982        -
      LaPorte, Texas          -            355,929            -    560,485        -

    Taco Cabana Restaurants:
      Austin, Texas           -            523,988      692,611          -        -
      Houston, Texas (p)      -            700,105      664,089          -        -

    Wendy's Old Fashioned
      Hamburgers Restaurants:
          Livingston, Tennesse-            261,701            -          -        -
                                        -----------  -----------  ---------  -------

                                        $7,375,340   $5,516,715   $4,343,095      -
                                        ===========  ===========  =========  =======



Property in Which the Partner-
    ship has a 19.56% Interest
    as Tenants-in-Common and
    has Invested in Under an
    Operating Lease:

        Boston Market Restaurant:
            Fayetteville, Nort- Carolina  $377,800     $587,700          -        -
                                        ===========  ===========  =========  =======

Property in Which the Partner-
    ship has a 27.42% Interest
    as Tenants-in-Common and
    has Invested in Under an
    Operating Lease:

        Black-eyed Pea Restaurant:
            Corpus Christi, Te-as (f) (h) $715,052     $726,004          -        -
                                        ===========  ===========  =========  =======

Property in Which the Partner-
    ship has a 36.91% Interest
    as Tenants-in-Common and
    has Invested in Under an
    Operating Lease:

      Burger King Restaurant:
          Akron, Ohio (f)     -           $355,594     $517,030          -        -
                                        ===========  ===========  =========  =======


Property of Joint Venture in
    Which the Partnership has
    a 21% Interest and
    has Invested in Under an
    Operating Lease:

        Jack in the Box Restaurant:
            Arlington, Texas (-)          $409,795     $680,085          -        -
                                        ===========  ===========  =========  =======

Property of Joint Venture in
    Which the Partnership has
    a 60.06% Interest and
    has Invested in Under an
    Operating Lease:

        Taco Bell Restaurant:
            Kingston, Tennesse-           $189,452     $328,444          -        -
                                        ===========  ===========  =========  =======

Property of Joint Venture in
    Which the Partnership has
    a 30.94% Interest and
    has Invested in Under an
    Operating Lease:

      Burger KinghRestaurantaurant:
            Ocean Shores, WA (-)          $351,015     $789,560          -        -
                                        ===========  ===========  =========  =======

Property in which the Partnership
      has a 24% Interest as
    Tenants-in-Common and
    has invested in Under an
    Operating Lease:

        Arby's Restaurant:
            Zephyrhills, FL   -           $260,146     $441,434          -        -
                                        ===========  ===========  =========  =======

Property of Joint Venture in
    Which the Partnership has
    a 86% Interest and
    has Invested in Under an
    Operating Lease:

       Golden Corral Restaurant:
            Lincoln, Nebraska -           $485,390   $1,254,984     $9,431        -
                                        ===========  ===========  =========  =======

Property in which the Partnership
      has a 25% Interest as
    Tenants-in-Common and
    has invested in Under an
    Operating Lease:

        Bennigan's Restaurant:
            Waldorf, Maryland -           $968,984   $1,311,515          -        -
                                        ===========  ===========  =========  =======

Property of Joint Venture in
    Which the Partnership has
    a 40% Interest and
    has Invested in Under an
    Operating Lease:

      Taco Cabana Restaurants:
        Katy,iTexas,(k)braska -           $623,066     $418,676          -        -
                                        ===========  ===========  =========  =======

Property in which the Partnership
      has a 90% Interest as
    Tenants-in-Common and
    has invested in Under an
    Operating Lease:

        Texas Roadhouse Restaurant:
       Kenosha,dWisconsinland -           $645,886   $1,237,163          -        -
                                        ===========  ===========  =========  =======

Properties the Partnership has
    Invested in Under Direct
    Financing Leases:

      Wendy's Old Fashioned
      Hamburgers Restaurant:
          Livingston, Tennesse-                  -            -   $455,575        -
                                        ===========  ===========  =========  =======










                                                                       Life on Which
              Net Cost Basis at Which                                  Depreciation in
              Carried at Close of Period (b)       Date                Latest Income
-------------------------------------
              Buildings and            Accumulated of Con-  Date       Statement is
   Land       Improvements   Total     DepreciationstructioAcquired      Computed
------------  -----------------------  ----------  ----------------    ------------





   $242,759     $564,223    $806,982     $14,513   1995     03/96          (m)
    348,245      470,577     818,822     102,474   1996     06/96          (c)
    296,025      557,809     853,834     115,026   1996     10/96          (c)


    403,341      634,010   1,037,351     166,537   1996     03/96          (c)
    613,965      587,556   1,201,521     154,392   1996     03/96          (c)
    887,767      597,381   1,485,148     112,489   1997     11/96          (c)


    305,509      670,990     976,499     143,221   1996     08/96          (c)


    300,482      421,898     722,380      86,614   1996     08/96          (c)



    711,838    1,162,406   1,874,244     264,408   1996     03/96          (c)
    508,790      862,571   1,371,361     188,488   1996     04/96          (c)
    345,926      691,222   1,037,148     145,859   1996     03/96          (c)


    324,970      509,982     834,952     107,923   1996     05/96          (c)
    355,929      560,485     916,414     117,230   1996     07/96          (c)


    523,988      692,611   1,216,599      25,011   1990     12/01          (c)
    700,105      664,089   1,364,194      12,912   1990     06/02          (c)



    261,701           (d)    261,701          (e)  1996     06/96          (e)
------------  -----------  ----------  ----------

 $7,131,340   $9,647,810   $16,779,150 $1,757,097
============  ===========  ==========  ==========










   $377,800     $587,700    $965,500    $122,308   1996     10/96          (c)
============  ===========  ==========  ==========








   $584,525     $614,141   $1,198,666   $138,650   1992     01/97          (c)
============  ===========  ==========  ==========








   $355,594     $517,030    $872,624    $102,158   1970     01/97          (c)
============  ===========  ==========  ==========









   $409,795     $680,085   $1,089,880    $10,075   1995     9/02           (c)
============  ===========  ==========  ==========








   $189,452     $328,444    $517,896     $55,715   1997     09/97          (c)
============  ===========  ==========  ==========








   $120,916     $281,310    $402,226     $24,923   1998     01/99          (c)
============  ===========  ==========  ==========








   $260,146     $441,434    $701,580     $58,161   1990     01/99          (c)
============  ===========  ==========  ==========








   $485,390   $1,264,415   $1,749,805    $73,758   2000     04/01          (c)
============  ===========  ==========  ==========








   $968,984   $1,311,515   $2,280,499    $65,575   2001     07/01          (c)
============  ===========  ==========  ==========








   $623,066     $418,676   $1,041,742     $8,141   1994     06/02          (c)
============  ===========  ==========  ==========








   $645,886   $1,237,163   $1,883,049    $17,183   2002     08/02          (c)
============  ===========  ==========  ==========







          -           (d)         (d)         (e)  1996     06/96          (e)
============

</TABLE>



<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

        NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

                                December 31, 2002


(a)      Transactions in real estate and accumulated depreciation are summarized
         below.  The  balances  in 1999,  2000,  and 2001 have been  adjusted to
         reflect  the   reclassification   of   properties   accounted   for  as
         discontinued operations.

<TABLE>
<CAPTION>
                                                                                              Accumulated
                                                                              Cost            Depreciation
                                                                         ----------------   -----------------

 <c>
            Properties the Partnership has Invested
              in Under Operating Leases:

                 Balance, December 31, 1999                                 $ 17,658,534        $  1,194,416
                 Acquisitions                                                  1,695,927                  --
                 Dispositions                                                 (1,470,189 )           (69,579 )
                 Provision for write-down of assets                             (565,070 )                --
                 Depreciation expense                                                 --             347,336
                                                                         ----------------   -----------------

                 Balance, December 31, 2000                                   17,319,202           1,472,173
                 Acquisitions                                                  1,216,598                  --
                 Dispositions                                                 (3,189,492 )          (321,421 )
                 Provision for write-down of assets                              (39,575 )                --
                 Depreciation expense                                                 --             291,966
                                                                         ----------------   -----------------

                 Balance, December 31, 2001                                   15,306,733           1,442,718
                 Acquisitions (p)                                              1,364,194                  --
                 Reclassification from direct financing lease (m)                564,223                  --
                 Provision for write-down of assets (n) (o)                     (456,000 )                --
                 Depreciation expense                                                 --             314,379
                                                                         ----------------   -----------------

                 Balance, December 31, 2002                              $    16,779,150        $  1,757,097
                                                                         ================   =================

            Property in Which the Partnership has a 19.56% Interest as
              Tenants-in-Common and has Invested in Under an Operating Lease:

                 Balance, December 31, 1999                                  $   965,500         $    63,538
                 Depreciation expense                                                 --              19,590
                                                                         ----------------   -----------------

                 Balance, December 31, 2000                                      965,500              83,128
                 Depreciation expense                                                 --              19,590
                                                                         ----------------   -----------------

                 Balance, December 31, 2001                                      965,500             102,718
                 Depreciation expense                                                 --              19,590
                                                                         ----------------   -----------------

                 Balance, December 31, 2002                                  $   965,500         $   122,308
                                                                         ================   =================


</TABLE>

<PAGE>
                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2002
<TABLE>
<CAPTION>

                                                                                                Accumulated
                                                                               Cost            Depreciation
                                                                          ----------------    ------------------

 <c>
            Property in Which the Partnership has a 27.42% Interest as
              Tenants-in-Common and has Invested in Under an Operating Lease:

                 Balance, December 31, 1999                                  $  1,441,056          $   70,848
                 Depreciation expense                                                  --              24,201
                                                                          ----------------    ----------------

                 Balance, December 31, 2000                                     1,441,056              95,049
                 Provision for write-down of assets (h)                          (242,390 )                --
                 Depreciation expense                                                  --              19,770
                                                                          ----------------    ----------------

                 Balance, December 31, 2001                                     1,198,666             114,819
                 Depreciation expense                                                  --              23,831
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                  $  1,198,666     $       138,650
                                                                          ================    ================

            Property in Which the Partnership has a 36.91% Interest as
              Tenants-in-Common and has Invested in Under an Operating Lease:

                 Balance, December 31, 1999                                   $   872,624          $   50,456
                 Depreciation expense                                                  --              17,234
                                                                          ----------------    ----------------

                 Balance, December 31, 2000                                       872,624              67,690
                 Depreciation expense                                                  --              17,234
                                                                          ----------------    ----------------

                 Balance, December 31, 2001                                       872,624              84,924
                 Depreciation expense                                                  --              17,234
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                   $   872,624     $       102,158
                                                                          ================    ================
</TABLE>


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2002

<TABLE>
<CAPTION>

                                                                                                Accumulated
                                                                               Cost            Depreciation
                                                                          ----------------    ----------------

 <c>
            Property of Joint Venture in Which the Partnership has a 21%
              Interest and has Invested in Under an Operating Lease:

                 Balance, December 31, 2001 (j)                              $         --         $        --
                 Acquisition (l)                                                1,089,880                  --
                 Depreciation expense                                                  --              10,075
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                               $     1,089,880         $    10,075
                                                                          ================    ================

            Property of Joint Venture in which the Partnership has a 60.06%
              Interest and has Invested in under an Operating Lease:

                 Balance, December 31, 1999                                   $   517,896         $    22,868
                 Depreciation expense                                                  --              10,949
                                                                          ----------------    ----------------

                 Balance, December 31, 2000                                       517,896              33,817
                 Depreciation expense                                                  --              10,949
                                                                          ----------------    ----------------

                 Balance, December 31, 2001                                       517,896              44,766
                 Depreciation expense                                                  --              10,949
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                   $   517,896         $    55,715
                                                                          ================    ================
</TABLE>


<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2002

<TABLE>
<CAPTION>

                                                                                                Accumulated
                                                                               Cost            Depreciation
                                                                          ----------------    ----------------

 <c>
            Property of Joint Venture in which the Partnership has a 30.94%
              Interest and has Invested in Under an Operating Lease:

                 Balance, December 31, 1999                                   $   351,015            $     --
                 Depreciation expense (e)                                              --                  --
                                                                          ----------------    ----------------

                 Balance, December 31, 2000                                       351,015                  --
                 Reclassification from direct financing lease                     789,560                  --
                 Provision for write-down of assets                              (738,349 )                --
                 Depreciation expense                                                  --              15,122
                                                                          ----------------    ----------------

                 Balance, December 31, 2001                                       402,226              15,122
                 Depreciation expense                                                  --               9,801
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                   $   402,226          $   24,923
                                                                          ================    ================

            Property in which the Partnership has a 24% Interest as
              Tenants-in-Common and has Invested in Under an Operating Lease:

                 Balance, December 31, 1999                                   $   701,580         $    13,532
                 Depreciation expense                                                  --              15,201
                                                                          ----------------    ----------------

                 Balance, December 31, 2000                                       701,580              28,733
                 Depreciation expense                                                  --              14,714
                                                                          ----------------    ----------------

                 Balance, December 31, 2001                                       701,580              43,447
                 Depreciation expense                                                  --              14,714
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                   $   701,580         $    58,161
                                                                          ================    ================

</TABLE>

<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2002

<TABLE>
<CAPTION>

                                                                                                Accumulated
                                                                               Cost            Depreciation
                                                                          ----------------    ----------------

 <c>
            Property of Joint Venture in which the Partnership has a 86%
              Interest and has Invested in Under an Operating Lease:

                 Balance, December 31, 2000                                      $     --            $     --
                 Acquisition                                                    1,740,374                  --
                 Depreciation expense                                                  --              31,375
                                                                          ----------------    ----------------

                 Balance, December 31, 2001                                     1,740,374              31,375
                Capitalization of additional construction costs                     9,431                  --
                 Depreciation expense                                                  --              42,383
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                  $  1,749,805     $        73,758
                                                                          ================    ================

            Property in which the Partnership has a 25% Interest as
              Tenants-in-Common and has Invested in Under an Operating Lease:

                 Balance, December 31, 2000                                      $     --            $     --
                 Acquisitions                                                   2,280,499                  --
                 Depreciation expense                                                  --              21,858
                                                                          ----------------    ----------------

                 Balance, December 31, 2001                                  $  2,280,499         $    21,858
                 Depreciation expense                                                  --              43,717
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                  $  2,280,499         $    65,575
                                                                          ================    ================

            Property of Joint Venture in Which the Partnership has a
               40% Interest and has Invested in Under an
              Operating Lease:

                 Balance, December 31, 2001                                      $     --            $     --
                 Acquisitions (k)                                               1,041,742                  --
                 Depreciation expense                                                  --               8,141
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                  $  1,041,742          $    8,141
                                                                          ================    ================

</TABLE>

<PAGE>


                           CNL INCOME FUND XVII, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2002

<TABLE>
<CAPTION>
                                                                                                Accumulated
                                                                               Cost            Depreciation
                                                                          ----------------    ----------------

 <c>
            Property in which the Partnership has a 90% Interest as
              Tenants-in-Common and has Invested in Under an Operating Lease:

                 Balance, December 31, 2001                                      $     --            $     --
                 Acquisitions                                                   1,883,049                  --
                 Depreciation expense                                                  --              17,183
                                                                          ----------------    ----------------

                 Balance, December 31, 2002                                  $  1,883,049         $    17,183
                                                                             ============         ===========
</TABLE>

(b)      As of December 31, 2002, the aggregate cost of the Properties  owned by
         the  Partnership  and the joint venture for federal income tax purposes
         was $17,341,796 and  $13,396,933,  respectively.  All of the leases are
         treated as operating leases for federal income tax purposes.

(c)      Depreciation  expense is computed for buildings and improvements  based
         upon estimated lives of 30 years.

(d)      Certain components of the lease relating to land and building have been
         recorded as a direct  financing lease.  Accordingly,  costs relating to
         these components of this lease are not shown.

(e)      The portion of the lease  relating to the building has been recorded as
         a direct financing lease. The cost of the building has been included in
         net investment in direct financing leases;  therefore,  depreciation is
         not applicable.

(f)      During the years  ended  December  31, 1997 and 1996,  the  Partnership
         purchased land and buildings  from  affiliates of the  Partnership  for
         aggregate costs of approximately $718,932 and $1,667,100, respectively.

(g)      During the year ended  December  31,  1998,  the  Partnership  received
         reimbursements   from  the   developer  of  the  property   upon  final
         reconciliation of total  construction  costs. In connection  therewith,
         the land and building value was adjusted accordingly.

(h)      The  undepreciated  cost of the Property in Corpus  Christi,  Texas, in
         which the Partnership owns an interest,  as  tenants-in-common  with an
         affiliate of the General  Partners,  was written down to its  estimated
         fair value due to an impairment in value.  The  Partnership  recognized
         the impairment by recording a provision for write-down of assets in the
         amount of $242,390 at December 31, 2001. The provision  represented the
         difference between the Property's carrying value and its estimated fair
         value at December 31, 2001. The cost of the Property  presented on this
         schedule  is the net  amount  at which  the  Property  was  carried  at
         December 31, 2001, including the provision for write-down of assets.

(i)      The  undepreciated  cost of the Property in Ocean  Shores,  Washington,
         owned by Ocean Shores Joint Venture, was written down to net realizable
         value due to an impairment in value.  The  Partnership  recognized  the
         impairment  by recording a provision  for  write-down  of assets in the
         amount of $738,349 at December 31, 2001. The impairment represented the
         difference between the Property's  carrying value and the estimated net
         realizable  value of the Property at December 31, 2001. The cost of the
         Property  presented  on this  schedule  is the net  amount at which the
         Property was carried at December 31, 2001,  including the provision for
         write-down of assets.


<PAGE>



(j)      In August 2002, Mansfield Joint Venture sold the property in Mansfield,
         Texas. As a result, the joint venture  reclassified the assets relating
         to this property from real estate with operating  leases to real estate
         held for sale.

(k)      During 2002, Katy Joint Venture,  in which the  Partnership  owns a 40%
         interest,  purchased a real  estate  property  from CNL 2001-A,  LP, an
         affiliate  of  the  General   Partners,   for  an  aggregate   cost  of
         approximately $1,041,700.

(l)      During 2002,  Mansfield Joint Venture,  in which the Partnership owns a
         21%  interest,  purchased  a real  estate  property  from CNL Net Lease
         Investors,  LP, an affiliate of the General Partners,  for an aggregate
         cost of approximately $1,089,900.

(m)      Effective  April  2002,  the  lease  for  this  property  was  amended,
         resulting in the  reclassification of the building portion of the lease
         to an operating lease. The building was recorded at net book value, and
         will be depreciated over its remaining  estimated life of approximately
         26 years.

(n)      The undepreciated cost of the Property in Harvey, Illinois, was written
         down to it  estimated  fair value due to an  impairment  in value.  The
         Partnership  recognized  the  impairment  by recording a provision  for
         write-down  of assets in the amount of $186,000 at December  31,  2002.
         The  provision   represented  the  difference  between  the  Property's
         carrying  value and the estimated  fair value at December 31, 2002. The
         cost of the Property  presented  on this  schedule is the net amount at
         which the  Property was carried at December  31,  2002,  including  the
         provision for write-down of assets.

(o)      The  undepreciated  cost of the  Property  in  Chicago,  Illinois,  was
         written down to its estimated fair value due to an impairment in value.
         The Partnership  recognized the impairment by recording a provision for
         write-down  of assets in the amount of $270,000 at December  31,  2002.
         The  provision   represented  the  difference  between  the  Property's
         carrying  value and the estimated  fair value at December 31, 2002. The
         cost of the Property  presented  on this  schedule is the net amount at
         which the  Property was carried at December  31,  2002,  including  the
         provision for write-down of assets.

(p)      During 2002, the Partnership  purchased a real estate property from CNL
         2001-A, LP, an affiliate of the General Partners, for an aggregate cost
         of approximately $ 1,364,200.




<PAGE>



                                  EXHIBIT INDEX


Exhibit Number

(a)      Exhibits

              **3.1        Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund XVII,  Ltd.  (Filed as Exhibit 3.1 to
                           the Registrant's Registration Statement on Form S-11,
                           No. 33-90998, incorporated herein by reference.)

              **3.2        Amended and Restated Agreement of Limited Partnership
                           of CNL Income Fund XVII,  Ltd.  (Included  as Exhibit
                           4.2 to  Form  10-K  filed  with  the  Securities  and
                           Exchange   Commission   on  March   21,   1996,   and
                           incorporated herein by reference.)

              **4.1        Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund XVII,  Ltd.  (Filed as Exhibit 3.1 to
                           Registration  Statement No. 33-90998 on Form S-11 and
                           incorporated herein by reference.)

              **4.2        Amended and Restated Agreement of Limited Partnership
                           of CNL Income Fund XVII,  Ltd.  (Included  as Exhibit
                           4.2 to  Form  10-K  filed  with  the  Securities  and
                           Exchange   Commission   on  March   21,   1996,   and
                           incorporated herein by reference.)

              **4.3        Form of Agreement  between CNL Income Fund XVII, Ltd.
                           and MMS Escrow and Transfer Agency,  Inc. and between
                           CNL  Income  Fund  XVIII,  Ltd.  and MMS  Escrow  and
                           Transfer  Agency,  Inc.  relating to the Distribution
                           Reinvestment  Plans  (Filed  as  Exhibit  4.4  to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **8.3        Opinion  of  Baker  &  Hostetler   regarding  certain
                           material   issues   relating   to  the   Distribution
                           Reinvestment  Plan  of CNL  Income  Fund  XVII,  Ltd.
                           (Filed as Exhibit 8.3 to  Amendment  No. Three to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **10.1       Management  Agreement  between  CNL Income Fund XVII,
                           Ltd. and CNL Fund Advisors, Inc. (Included as Exhibit
                           10.1 to Form  10-K  filed  with  the  Securities  and
                           Exchange   Commission   on  March   21,   1996,   and
                           incorporated herein by reference.)

              **10.2       Assignment  of  Management  Agreement  from  CNL Fund
                           Advisors,  Inc. to CNL APF Partners, LP. (Included as
                           Exhibit  10.2 to Form 10-Q filed with the  Securities
                           and  Exchange  Commission  on August  13,  2001,  and
                           incorporated herein by reference.)

              **10.3       Form of Joint Venture  Agreement  for Joint  Ventures
                           with Unaffiliated  Entities (Filed as Exhibit 10.2 to
                           the Registrant's Registration Statement on Form S-11,
                           No. 33-90998, incorporated herein by reference.)

              **10.4       Form of Joint Venture  Agreement  for Joint  Ventures
                           with  Affiliated  Programs  (Filed as Exhibit 10.3 to
                           the Registrant's Registration Statement on Form S-11,
                           No. 33-90998, incorporated herein by reference.)

              **10.5       Form of Development  Agreement (Filed as Exhibit 10.5
                           to the  Registrant's  Registration  Statement on Form
                           S-11,   No.   33-90998,    incorporated   herein   by
                           reference.)

              **10.6       Form of  Indemnification  and Put Agreement (Filed as
                           Exhibit   10.6  to  the   Registrant's   Registration
                           Statement on Form S-11,  No.  33-90998,  incorporated
                           herein by reference.)

              **10.7       Form  of  Unconditional   Guarantee  of  Payment  and
                           Performance   (Filed   as   Exhibit   10.7   to   the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **10.8       Form  of  Lease  Agreement  for  Existing  Restaurant
                           (Filed   as   Exhibit   10.8   to  the   Registrant's
                           Registration  Statement on Form S-11,  No.  33-90998,
                           incorporated herein by reference.)

              **10.9       Form  of  Lease   Agreement  for   Restaurant  to  be
                           Constructed   (Filed   as   Exhibit   10.9   to   the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **10.10      Form of Premises  Lease for Golden Corral  Restaurant
                           (Filed   as   Exhibit   10.10  to  the   Registrant's
                           Registration  Statement on Form S-11,  No.  33-90998,
                           incorporated herein by reference.)

              **10.11      Form of Agreement  between CNL Income Fund XVII, Ltd.
                           and MMS Escrow and Transfer Agency,  Inc. and between
                           CNL  Income  Fund  XVIII,  Ltd.  and MMS  Escrow  and
                           Transfer  Agency,  Inc.  relating to the Distribution
                           Reinvestment  Plans  (Filed  as  Exhibit  4.4  to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **10.12      Form of Cotenancy  Agreement with Unaffiliated Entity
                           (Filed as Exhibit  10.12 to Amendment  No. One to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **10.13      Form of Cotenancy  Agreement with  Affiliated  Entity
                           (Filed as Exhibit  10.13 to Amendment  No. One to the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **10.14      Form of Registered  Investor Advisor Agreement (Filed
                           as  Exhibit   10.14  to  Amendment  No.  One  to  the
                           Registrant's Registration Statement on Form S-11, No.
                           33-90998, incorporated herein by reference.)

              **10.15      Assignment  of  Management  Agreement  from  CNL  APF
                           Partners, LP to CNL Restaurants XVIII, Inc. (Included
                           as  Exhibit   10.15  to  Form  10-Q  filed  with  the
                           Securities  and  Exchange  Commission  on August  14,
                           2002, and incorporated herein be reference.)

                99.1       Certification of Chief Executive Officer of Corporate
                           General Partner Pursuant to 18 U.S.C. Section 1350 as
                           Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                           Act of 2002. (Filed herewith.)

                99.2       Certification of Chief Financial Officer of Corporate
                           General Partner Pursuant to 18 U.S.C. Section 1350 as
                           Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                           Act of 2002. (Filed herewith.)

**previously filed


<PAGE>



                                  EXHIBIT 99.1




<PAGE>

                                  EXHIBIT 99.2