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

                                  FORM 10-K405

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

      For the fiscal year ended       December 31, 1996
                                ------------------------------------------------

                                       OR

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

     For the transition period from ______________ to_____________

     Commission file number  0-14267
                            --------


                       McNEIL REAL ESTATE FUND XXIV, L.P.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


         California                             74-2339537
--------------------------------------------------------------------------------
(State or other jurisdiction of                (I.R.S. Employer
incorporation or organization)                  Identification No.)


             13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240
--------------------------------------------------------------------------------
               (Address of principal executive offices) (Zip code)


Registrant's telephone number, including area code   (972) 448-5800
                                                   -----------------------------

Securities registered pursuant to Section 12(b) of the Act:  None
----------------------------------------------------------

Securities registered pursuant to Section 12(g) of the Act:  Limited partnership
                                                             units
----------------------------------------------------------

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,  and (2) has been subject to such filing  requirements
for the past 90 days. Yes X No
                         ---  ---

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]

All of the registrant's 40,000 outstanding limited partnership units are held by
non-affiliates.  The aggregate market value of units held by  non-affiliates  is
not determinable since there is no public trading market for limited partnership
units and transfers of units are subject to certain restrictions.


Documents Incorporated by Reference:   See Item 14, Page 39

                                TOTAL OF 40 PAGES
<PAGE>
                                     PART I

ITEM 1.      BUSINESS
-------      --------

ORGANIZATION
------------

McNeil  Real Estate  Fund XXIV,  L.P.  (the  "Partnership"),  formerly  known as
Southmark Equity Partners,  Ltd., was organized on October 19, 1984 as a limited
partnership under the provisions of the California  Revised Limited  Partnership
Act to acquire and operate  commercial and residential  properties.  The general
partner of the Partnership is McNeil Partners,  L.P. (the "General Partner"),  a
Delaware limited partnership,  an affiliate of Robert A. McNeil ("McNeil").  The
General Partner was elected at a meeting of limited  partners on March 30, 1992,
at which  time an amended  and  restated  partnership  agreement  (the  "Amended
Partnership  Agreement")  was  adopted.  Prior to March 30,  1992,  the  general
partner of the Partnership was Southmark  Investment  Group, Inc. (the "Original
General   Partner"),   a  wholly-owned   subsidiary  of  Southmark   Corporation
("Southmark").  The  principal  place of business  for the  Partnership  and the
General Partner is 13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240.

On January 8, 1985, the Partnership  registered with the Securities and Exchange
Commission  ("SEC")  under the  Securities  Act of 1933 (File No.  2-93979)  and
commenced a public offering for sale of $40,000,000 of limited partnership units
("Units").  The Units represent  equity interests in the Partnership and entitle
the holders thereof to participate in certain  allocations and  distributions of
the Partnership. The sale of Units closed on December 15, 1985 with 40,000 Units
sold at $1,000 each, or gross proceeds of $40,000,000  to the  Partnership.  The
Partnership  subsequently  filed a Form 8-A Registration  Statement with the SEC
and  registered  its Units under the  Securities  Exchange Act of 1934 (File No.
0-14267).

SOUTHMARK BANKRUPTCY AND CHANGE IN GENERAL PARTNER
--------------------------------------------------

On July 14, 1989,  Southmark filed a voluntary petition for reorganization under
Chapter 11 of the U.S.  Bankruptcy Code.  Neither the  Partnership,  the General
Partner  nor  the  Original   General  Partner  were  included  in  the  filing.
Southmark's  reorganization  plan became  effective  August 10, 1990.  Under the
plan, most of Southmark's assets,  which included  Southmark's  interests in the
Original General Partner, were sold or liquidated for the benefit of creditors.

In  accordance  with  Southmark's  reorganization  plan,  Southmark,  McNeil and
various of their affiliates  entered into an asset purchase agreement on October
12, 1990,  providing for, among other things,  the transfer of control to McNeil
or his affiliates of 34 limited partnerships  (including the Partnership) in the
Southmark portfolio.

On February 14,  1991,  pursuant to the asset  purchase  agreement as amended on
that date,  McNeil Real Estate  Management,  Inc.  ("McREMI"),  an  affiliate of
McNeil,  acquired the assets relating to the property management and partnership
administrative business of Southmark and its affiliates and commenced management
of the  Partnership's  properties  pursuant  to an  assignment  of the  existing
property management agreements from the Southmark affiliates.




<PAGE>
On March 30, 1992, the limited partners  approved a restructuring  proposal that
provided  for (i) the  replacement  of the Original  General  Partner with a new
general  partner,  McNeil  Partners,  L.P.;  (ii) the  adoption  of the  Amended
Partnership  Agreement which substantially alters the provisions of the original
partnership   agreement   relating   to,  among  other   things,   compensation,
reimbursement  of expenses and voting  rights;  (iii) the approval of an amended
property management  agreement with McREMI, the Partnership's  property manager;
and (iv) the  approval  to change the  Partnership's  name to McNeil Real Estate
Fund XXIV, L.P. Under the Amended Partnership  Agreement,  the Partnership began
accruing an asset  management  fee,  retroactive to February 14, 1991,  which is
payable  to  the  General  Partner.  For a  discussion  of the  methodology  for
calculating the asset  management fee, see Item 13 - Certain  Relationships  and
Related Transactions.  The proposals approved at the March 30, 1992 meeting were
implemented as of that date.

Concurrent with the approval of the restructuring,  the General Partner acquired
from Southmark and its affiliates,  for aggregate  consideration of $43,193, (i)
the right to receive  payment on the  advances  owing  from the  Partnership  to
Southmark  and its  affiliates  in the amount of $642,581,  and (ii) the general
partner interest of the Original General Partner. None of the Units are owned by
the General Partner or its affiliates.

CURRENT OPERATIONS
------------------

General:

The  Partnership  is engaged  in the  ownership,  operation  and  management  of
residential and retail real estate.  At December 31, 1996, the Partnership owned
seven  income-producing  properties as described in Item 2 - Properties.  Six of
the  Partnership's  seven  properties  were acquired in  transactions  involving
payment of all cash to the sellers. A large portion of the Partnership's  rental
revenue is  attributable  to one property,  Southpointe  Plaza Shopping  Center.
Southpointe  Plaza Shopping Center  contributed  approximately  27% of the total
Partnership rental revenue in 1996, and 30% in 1995 and 1994.

The  Partnership  does not directly  employ any personnel.  The General  Partner
conducts the business of the  Partnership  directly and through its  affiliates.
The Partnership  reimburses  affiliates of the General Partner for such services
rendered in accordance with the Amended Partnership Agreement. See Item 8 - Note
2 "Transactions With Affiliates."

The business of the Partnership to date has involved only one industry  segment.
See Item 8 - Financial Statements and Supplementary Data. The Partnership has no
foreign operations. The business of the Partnership is not seasonal.


<PAGE>
Business Plan:

The Partnership  determined to evaluate market and other economic  conditions to
establish  the  optimum  time  to  commence  an  orderly   liquidation   of  the
Partnership's  assets in  accordance  with the terms of the Amended  Partnership
Agreement.  Taking such conditions as well as other pertinent  information  into
account,  the Partnership has determined to begin orderly liquidation of all its
assets.  Although there can be no assurance as to the timing of the  liquidation
due to real estate  market  conditions,  the general  difficulty of disposing of
real estate,  and other general  economic  factors,  it is anticipated that such
liquidation  would result in the  dissolution of the  Partnership  followed by a
liquidating  distribution  to the limited  partners by  December  1998.  In this
regard,  the Partnerships  has placed Island Plaza and Southpointe  Plaza on the
market for sale effective April 1, 1996 and October 1, 1996, respectively. Until
such time as the Partnership's assets are liquidated,  the Partnership's plan of
operations  is to preserve or increase  the net  operating  income of its assets
whenever possible,  while at the same time making whatever capital  expenditures
are  reasonable  under the  circumstances  in order to preserve  and enhance the
value of the Partnership's assets.


Competitive Conditions:

Since the  principal  business of the  Partnership  is to own and  operate  real
estate,  the Partnership is subject to all of the risks  incidental to ownership
of real estate and interests therein, many of which relate to the illiquidity of
this type of  investment.  These  risks  include  changes  in  general  or local
economic conditions,  changes in supply or demand for competing properties in an
area,  changes in interest rates and  availability  of permanent  mortgage funds
which  may  render  the  sale  or  refinancing   of  a  property   difficult  or
unattractive, changes in real estate and zoning laws, increases in real property
tax rates and Federal or local  economic or rent  controls.  The  illiquidity of
real estate  investments  generally  impairs the ability of the  Partnership  to
respond  promptly  to  changed  circumstances.  The  Partnership  competes  with
numerous established companies, private investors (including foreign investors),
real estate investment trusts,  limited partnerships and other entities (many of
which have greater  resources than the Partnership) in connection with the sale,
financing  and  leasing  of  properties.  The  impact  of  these  risks  on  the
Partnership,   including   losses  from  operations  and   foreclosures  of  the
Partnership's  properties,  is described in Item 7 - Management's Discussion and
Analysis  of  Financial  Condition  and  Results  of  Operations.  See  Item 2 -
Properties  for a  discussion  of the  competitive  conditions  at  each  of the
Partnership's properties.

Forward-Looking Information:

Within this document,  certain  statements are made as to the expected occupancy
trends,  financial  condition,  results  of  operations,  and cash  flows of the
Partnership  for periods after  December 31, 1996.  All of these  statements are
forward-looking  statements  made pursuant to the safe harbor  provisions of the
Private  Securities  Litigation  Reform Act of 1995.  These  statements  are not
historical  and  involve  risks  and  uncertainties.  The  Partnership's  actual
occupancy trends, financial condition, results of operations, and cash flows for
future  periods may differ  materially  due to several  factors.  These  factors
include,  but are not limited to, the  Partnership's  ability to control  costs,
make necessary  capital  improvements,  negotiate  sales or  refinancings of its
properties and respond to changing economic and competitive factors.


<PAGE>
Other information:

The environmental  laws of the Federal government and of certain state and local
governments  impose  liability  on current  property  owners for the clean-up of
hazardous and toxic substances discharged on the property.  The liability may be
imposed  without  regard  to the  timing,  cause or person  responsible  for the
release of such substances onto the property.  The Partnership  could be subject
to such liability in the event that it owns properties having such environmental
problems.  The Partnership has no knowledge of any pending claims or proceedings
regarding such environmental problems.

In August 1995, High River Limited  Partnership,  a Delaware limited partnership
controlled by Carl C. Icahn ("High River") made an  unsolicited  tender offer to
purchase from holders of Units up to approximately  45% of the outstanding Units
of the  Partnership  for a purchase  price of $150 per Unit. In September  1996,
High River made another  unsolicited tender offer to purchase any and all of the
outstanding  Units of the  Partnership for a purchase price of $268.13 per unit.
In  addition  High River  made  unsolicited  tender  offers  for  certain  other
partnerships controlled by the General Partner. The Partnership recommended that
the  limited  partners  reject  the  tender  offers  made  with  respect  to the
Partnership and not tender their Units.  The General Partner believes that as of
January  31,  1997,  High  River  has  purchased   approximately  8.86%  of  the
outstanding  Units  pursuant to the tender offers.  In addition,  all litigation
filed by High River,  Mr. Icahn and his affiliates in connection with the tender
offers has been dismissed without prejudice.

ITEM 2.    PROPERTIES
-------    ----------

The  following  table sets forth the real  estate  investment  portfolio  of the
Partnership  at December 31, 1996.  All of the  buildings  and the land on which
they are located are owned by the  Partnership  in fee and are  unencumbered  by
mortgage indebtedness,  with the exception of Southpointe Plaza Shopping Center,
which is subject to a first lien deed of trust as set forth more fully in Item 8
- Note 5 -  "Mortgage  Note  Payable."  See also Item 8 - Note 4 - "Real  Estate
Investments"  and  Schedule  III  -  Real  Estate  Investments  and  Accumulated
Depreciation and Amortization.  In the opinion of management, the properties are
adequately covered by insurance.

<TABLE>
<CAPTION>
                                           Net Basis                              1996           Date
Property              Description         of Property           Debt        Property Taxes     Acquired
--------              -----------        ------------           ----        --------------     --------
<S>                   <C>                <C>                 <C>             <C>                   <C>  
Real Estate Investments:

Pine Hills            Apartments
Livingston, TX        128 units          $  2,584,155        $          -    $     37,657          10/85

Riverbay Plaza        Retail Center
Riverview, FL         73,065 sq. ft.         3,469,934                  -          58,994           4/85

Sleepy Hollow         Apartments
Cleveland, TX         112 units              2,707,700                  -          64,889           8/85

</TABLE>


<PAGE>

<TABLE>
<CAPTION>
                                           Net Basis                              1996           Date
Property              Description         of Property           Debt        Property Taxes     Acquired
--------              -----------        ------------           ----        --------------     --------
<S>                   <C>                <C>                 <C>             <C>                   <C>  
Springwood Plaza      Retail Center
Dellwood, MO          88,323 sq. ft.         2,759,372                  -          67,112           9/85

Towne Center          Retail Center
Derby, KS             94,320 sq. ft.          1,450,154                 -          40,591           7/85
                                           ------------       -----------     -----------
                                         $   12,971,315      $          -    $    269,243
                                           ============       ===========     ===========
Assets Held for Sale:

Island Plaza          Retail Center
Ft. Myers, FL         60,076 sq. ft.     $   2,016,188       $          -    $     51,468            4/85

Southpointe Plaza     Retail Center
Sacramento, CA        83,506 sq. ft.         6,392,484          5,421,763         102,564           11/85
                                          ------------        -----------     -----------
                                         $   8,408,672       $  5,421,763    $    154,032
                                          ============        ===========     ===========
</TABLE>
---------------------------------------
Total:    Apartments  -  240 units
          Retail Centers - 399,290 sq. ft.

The  following  table sets  forth the  properties'  occupancy  rate and rent per
square foot for the last five years:

<TABLE>
<CAPTION>
                                      1996             1995            1994           1993          1992
                                 --------------  ---------------  --------------  -------------  -------
<S>                                 <C>            <C>            <C>            <C>             <C>
Real Estate Investments:

Pine Hills

   Occupancy Rate............             94%             99%            99%            98%             99%
   Rent Per Square Foot......       $    6.93      $     6.76     $     6.44      $    6.06       $    5.57

Riverbay Plaza
   Occupancy Rate............             94%             94%            92%            88%             89%
   Rent Per Square Foot......       $    7.15      $     6.85     $     8.55      $    7.03       $    6.85

</TABLE>


<PAGE>

<TABLE>
<CAPTION>

                                      1996             1995            1994           1993          1992
                                 --------------  ---------------  --------------  -------------  -------
<S>                                       <C>            <C>             <C>            <C>             <C>
Sleepy Hollow
   Occupancy Rate............             92%            100%            99%            95%             98%
   Rent Per Square Foot......       $    7.14      $     7.32     $     6.91      $    6.76       $    6.58


Springwood Plaza
   Occupancy Rate............             96%             80%            72%            80%             82%
   Rent Per Square Foot......       $    6.03      $     4.49     $     4.59      $    4.96       $    6.52

Towne Center
   Occupancy Rate............            100%            100%           100%            53%             51%
   Rent Per Square Foot......       $    3.21      $     3.59     $     3.21      $    2.93       $    2.73

Assets Held for Sale:

Island Plaza
   Occupancy Rate............             86%             79%            80%            84%             79%
   Rent Per Square Foot......       $    6.45      $     6.20      $    7.09      $    7.56       $    7.42

Southpointe Plaza
   Occupancy Rate............             83%             97%            90%            86%             98%
   Rent Per Square Foot......       $   13.46      $    14.18      $   14.35      $   13.41       $   16.24
</TABLE>

Occupancy rate  represents all units leased divided by the total number of units
for  residential  properties  and square  footage leased divided by total square
footage for other  properties  as of  December  31 of the given  year.  Rent per
square foot represents all revenue, except interest, derived from the property's
operations divided by the leasable square footage of the property.

Competitive conditions:
-----------------------

Island Plaza
------------

Island Plaza is a 60,076 square foot,  single-story retail strip shopping center
located near a major  intersection of a suburban  market in Ft. Myers,  Florida.
The  property is set back from its frontage  road behind three out parcels.  The
center is anchored by a grocery chain which occupies 30,800 square feet. Two new
grocery-anchored  shopping  centers  were  developed  within  the  area and have
brought strong  competition to Island Plaza.  The  competitors'  grocery anchors
occupy  approximately  65,000 square  feet-more than twice the square footage of
Island Plaza's  anchor.  As a result,  the grocery anchor tenant at Island Plaza
filed for  reorganization  under the U.S.  bankruptcy laws. In order to keep the
anchor open and maintain  the  viability of Island  Plaza,  it was  necessary to






<PAGE>
negotiate a modification  of the lease during 1995,  resulting in a reduction in
rent.  Additionally,  road construction  completed during 1995 moved the flow of
traffic away from Island Plaza  toward the two new shopping  centers  previously
described.  The Partnership  expects to maintain occupancy in the high 80% range
in 1997. The Partnership  has determined to begin an orderly  liquidation of all
the Partnership's assets. In this regard, the Partnership placed Island Plaza on
the market for sale  effective  April 1, 1996 and has  received  an offer from a
non-affiliate to purchase the center for $2.1 million.

Pine Hills
----------

Pine Hills is a two-story  class "A"  apartment  community  located in the small
town of Livingston,  approximately 60 miles north of Houston, Texas. There is no
class "A" competition within the area at present.  Occupancy declined in 1996 as
a result of the  availability of affordable  alternative  housing such as mobile
homes and rental houses.  The Partnership  expects to maintain  occupancy in the
mid 90% range in 1997.

Riverbay Plaza
--------------

Riverbay Plaza is a single-story  retail  shopping center located at the busiest
intersection  of a rural  area near  Riverview,  Florida.  It is  anchored  by a
grocery  store and a  drugstore  and there are two out  parcels  in front of the
center that draw customers to the center. Currently, there is only one competing
shopping  center in the area which is not as well  maintained as Riverbay Plaza.
The Partnership plans to spend  approximately $1.6 million in 1997 to expand the
anchor tenant's space by 5,311 square feet. The Partnership  expects to maintain
occupancy in the low to mid 90% range in 1997.

Sleepy Hollow
-------------

Sleepy Hollow is a two-story class "A" apartment  community located in the small
town of Cleveland,  approximately 30 miles north of Houston,  Texas. There is no
class "A"  competition  within the area at present.  Two  neighboring  apartment
communities  completed  renovations  early in 1996 which  allowed them to become
more  competitive  than Sleepy Hollow.  In addition,  low interest rates and the
availability of affordable  alternative  housing such as mobile homes and rental
houses have  softened the local real estate  market.  As a result,  the property
experienced a decline in occupancy in 1996.  Although two  additional  apartment
communities are scheduled for  construction in 1997, the Partnership  expects to
maintain occupancy in the low 90% range in 1997.















<PAGE>
Southpointe Plaza
-----------------

Southpointe  Plaza is a retail  strip  shopping  center  located in the southern
quadrant of Sacramento, California. The property is easily accessible and highly
visible from the highway.  The  declining  economic  conditions  in the adjacent
neighborhood have resulted in increased criminal activity. The center has strong
anchor tenants which, while doing well, seem to be destination stores and do not
generate a lot of foot traffic for the center.  New  shopping  centers are being
constructed  to the  south of the  property,  and one of the  property's  anchor
tenants opened a store in a new center  located five miles to the south.  Should
the tenant decide to vacate  Southpointe  Plaza, it could have a severe negative
impact on the future marketing of the smaller lease space at the center. Another
user of a pad site at the center has also decided to relocate their store to one
of the newer  centers,  which  could  result in a sublease  to a less  desirable
tenant.  Although occupancy at the center is projected to increase to the low to
mid 90% range by the end of 1997, management expects to reduce rents for tenants
who are currently  paying rents above market.  The Partnership has determined to
begin an orderly  liquidation of all the  Partnership's  assets. In this regard,
the  Partnership  placed  Southpointe  Plaza on the  market  for sale  effective
October 1, 1996. The Partnership  has received an offer from a non-affiliate  to
purchase  the center for $6.8  million.  Based on this  offer,  the  Partnership
recorded a $700,000 write-down for impairment of value during the fourth quarter
of 1996 to record the shopping center at its fair value less costs to sell.

Springwood Plaza
----------------

Springwood Plaza is a multi-leveled strip shopping center located in a suburb of
St. Louis, Missouri. The center is anchored by a popular local grocery chain and
contains fifteen other retail spaces. The area surrounding the property has been
in a slow state of decline for the past few years. Occupancy, which had declined
in 1994,  increased in 1995 and 1996 due to capital improvements made to improve
the appearance of the center. Most of the comparable  properties in the area are
superior  to  Springwood  Plaza.   However,  with  continued  attention  to  the
appearance  of the property and rental rates lower than the newer centers in the
area, management expects to maintain occupancy in mid 90% range in 1997.

Towne Center
------------

Towne  Center is a retail  strip  shopping  center  located in a suburb 10 miles
south of Wichita,  Kansas.  The property is one of five strip  shopping  centers
located in Derby, and it is by far the largest.  In 1994, the center became 100%
occupied  due to the  leasing of a large  space that had been vacant for several
years.  The  lease  on this  space  expires  in 1997 as does the  lease  for the
center's  grocery store anchor tenant. A total of 80% of the leased space at the
center expires during 1997,  with 48% of the space expected to vacate.  Although
demand for retail space in Derby is limited, space available is also limited and
the  smaller  spaces  should  not be  difficult  to lease.  However,  management
estimates that it could take up to a year to release the expected vacancy of the
tenant that occupies 42% of the space.  Management has concluded that,  based on
the projected future cash flows of the property, no impairment of value exists.


<PAGE>
The following  schedule shows lease  expirations  for each of the  Partnership's
commercial properties for 1997 through 2006:

<TABLE>
<CAPTION>
                                 Number of                               Annual             % of Gross
                                Expirations           Square Feet         Rent              Annual Rent
                                -----------           -----------       -------             -----------         

Real Estate Investments:
------------------------

Riverbay Plaza
--------------

<C>                                    <C>               <C>          <C>                           <C>
1997                                   4                 4,959        $   36,012                    8%
1998                                   2                 1,950            17,556                    4%
1999                                   2                 2,555            24,204                    5%
2000                                   2                 6,593            45,120                   10%
2001                                   -                     -                 -                    -
2002                                   -                     -                 -                    -
2003                                   -                     -                 -                    -
2004                                   1                40,297           236,256                   51%
2005 - 2006                            -                     -                 -                    -

Springwood Plaza
----------------
1997                                   5                 8,529        $   67,668                   15%
1998                                   1                 2,000            12,000                    3%
1999                                   4                54,335           273,540                   61%
2000                                   2                 4,316            24,444                    5%
2001                                   2                 7,092            46,308                   10%
2002                                   1                 7,100            26,628                    6%
2003 - 2006                             -                    -                 -                    -

Towne Center
------------
1997                                   8                75,986        $  196,992                   68%
1998                                   3                 7,087            21,792                    8%
1999                                   4                 7,831            54,096                   19%
2000                                   -                     -                 -                    -
2001                                   1                 2,768            15,588                    5%
2002 - 2006                            -                     -                 -                    -
</TABLE>


<PAGE>

<TABLE>
<CAPTION>
                                 Number of                               Annual               % of Gross
                                Expirations           Square Feet         Rent                Annual Rent
                                -----------           -----------       -------               -----------         
Assets Held for Sale:
---------------------

Island Plaza
------------
<C>                                    <C>               <C>          <C>                          <C>
1997                                   4                 6,384        $   44,016                   14%
1998                                   5                 7,719            71,076                   23%
1999                                   2                 3,415            27,588                    9%
2000                                   2                 2,508            16,752                    5%
2001                                   -                     -                 -                    -
2002                                   -                     -                 -                    -
2003                                   -                     -                 -                    -
2004                                   1                30,800           153,996                   49%
2005 - 2006                            -                     -                 -                    -

Southpointe Plaza
-----------------

1997                                   7                12,520        $  187,260                   22%
1998                                   2                 5,843            81,912                   10%
1999                                   1                 1,588            22,872                    3%
2000                                   2                 3,872            45,960                    5%
2001                                   4                 8,627            81,948                   10%
2002                                   2                14,003           158,304                   18%
2003                                   2                19,848           182,484                   21%
2004 - 2006                            -                     -                 -                    -
</TABLE>

No  residential  tenant  leases 10% or more of the available  rental space.  The
following  schedule reflects  information on commercial tenants occupying 10% or
more of the leasable square feet for each property:

Nature of
Business                     Square Footage                             Lease
   Use                           Leased           Annual Rent         Expiration
---------                    --------------       -----------         ----------
Real Estate Investments:
------------------------
Riverbay Plaza

Grocery Store                   40,297            $  236,256              2004
Drugstore                       13,500               101,256              2042

Springwood Plaza

Grocery Store                   46,558            $   217,680             1999

Towne Center

Home Furnishings                40,034            $    48,036             1997
Grocery Store                   22,660                 61,620             1997

<PAGE>
Nature of
Business                     Square Footage                             Lease
   Use                           Leased           Annual Rent         Expiration
--------                     --------------       -----------         ----------
Assets Held for Sale:
---------------------

Island Plaza

Grocery Store                   30,800            $   153,996             2004

Southpointe Plaza

Sporting Goods                  10,000            $    50,004             2002
Toy Store                       14,850                 95,100             2003


ITEM 3.      LEGAL PROCEEDINGS
-------      -----------------

The Partnership is not party to, nor are any of the Partnership's properties the
subject of, any material pending legal proceedings, other than ordinary, routine
litigation incidental to the Partnership's business, except for the following:

1)   Martha Hess, et al. v. Southmark Equity Partners II, Ltd., Southmark Income
     Investors, Ltd., Southmark Equity Partners, Ltd. (presently known as McNeil
     Real Estate Fund XXIV,  L.P.),  Southmark  Realty  Partners III,  Ltd., and
     Southmark Realty Partners II, Ltd., et al. ("Hess");  Kotowski v. Southmark
     Equity Partners, Ltd. and Donald Arceri v. Southmark Income Investors, Ltd.
     The Hess case was filed on May 20, 1988, by Martha Hess,  individually  and
     on behalf of a putative class of those  similarly  situated.  The original,
     first,  second and third  amended  complaints  in Hess  sought  rescission,
     pursuant to the Illinois  Securities Act, of over $2.7 million of principal
     invested in five  Southmark  (now  McNeil)  partnerships,  and other relief
     including  damages  for  breach  of  fiduciary  duty and  violation  of the
     Illinois Consumer Fraud and Deceptive Business Practices Act. The original,
     first,  second and third amended  complaints in Hess were dismissed against
     the defendant-group because the Appellate Court held that they were not the
     proper subject of a class action complaint. Hess was, thereafter, amended a
     fourth  time to  state  causes  of  action  against  unrelated  partnership
     entities. Hess went to judgment against that entity and the judgment, along
     with the prior  dismissals  of the class action,  was appealed.  The claims
     against the Partnership were dismissed by the Appellate Court.

2)   James F. Schofield, Gerald C. Gillett, Donna S. Gillett, Jeffrey Homburger,
     Elizabeth Jung,  Robert Lewis,  and Warren Heller et al. v. McNeil Partners
     L.P., McNeil Investors,  Inc., McNeil Real Estate Management,  Inc., Robert
     A. McNeil,  Carole J. McNeil,  McNeil Pacific  Investors  Fund 1972,  Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XII, Ltd.,  McNeil Real
     Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd., McNeil Real Estate
     Fund XX, L.P.,  McNeil Real Estate Fund XXI, L.P.,  McNeil Real Estate Fund
     XXII,  L.P.,  McNeil Real Estate Fund XXIV,  L.P.,  McNeil Real Estate Fund
     XXV, L.P.,  McNeil Real Estate Fund XXVI, L.P., and McNeil Real Estate Fund
     XXVII,  L.P., et al. - Superior  Court of the State of  California  for the
     County of Los  Angeles,  Case No.  BC133799  (Class and  Derivative  Action
     Complaint).


<PAGE>
     The action  involves  purported  class and  derivative  actions  brought by
     limited  partners of each of the fourteen  limited  partnerships  that were
     named as nominal  defendants as listed above (as defined in this Section 2,
     the  "Partnerships").  Plaintiffs allege that McNeil  Investors,  Inc., its
     affiliate  McNeil Real Estate  Management,  Inc.  and three of their senior
     officers and/or directors (as defined in this Section 2, collectively,  the
     "Defendants") breached their fiduciary duties and certain obligations under
     the  respective  amended  partnership  agreements.  Plaintiffs  allege that
     Defendants  have  rendered  such Units  highly  illiquid  and  artificially
     depressed  the prices that are  available  for Units on the resale  market.
     Plaintiffs  also allege that  Defendants  engaged in a course of conduct to
     prevent  the  acquisition  of  Units  by an  affiliate  of  Carl  Icahn  by
     disseminating  purportedly  false,  misleading and inadequate  information.
     Plaintiffs  further  allege  that  Defendants  acted to  advance  their own
     personal interests at the expense of the Partnerships'  public unit holders
     by failing to sell Partnership properties and failing to make distributions
     to unitholders.

     On December 16,  1996,  the  plaintiffs  filed a  consolidated  and amended
     complaint.  Plaintiffs  are suing for breach of fiduciary  duty,  breach of
     contract  and  an  accounting,  alleging,  among  other  things,  that  the
     management  fees paid to the McNeil  affiliates over the last six years are
     excessive,  that these fees  should be reduced  retroactively  and that the
     respective amended  partnership  agreements  governing the Partnerships are
     invalid.  On January 7, 1997,  the Court ordered  consolidation  with three
     other similar actions listed below.

     The  Partnerships  filed a demurrer to the complaint and a motion to strike
     on February 14, 1997, seeking to dismiss the complaint in all respects. The
     demurrer is pending.  The Partnerships  deny that there is any merit to the
     plaintiffs' allegations and intend to vigorously defend this action.

3)   Alfred Napoletano v. McNeil Partners, L.P., McNeil Investors,  Inc., Robert
     A. McNeil,  Carole J. McNeil,  McNeil Pacific  Investors  Fund 1972,  Ltd.,
     McNeil Real Estate Fund V, Ltd.,  McNeil Real Estate Fund IX, Ltd.,  McNeil
     Real Estate Fund X, Ltd.,  McNeil  Real Estate Fund XI,  Ltd.,  McNeil Real
     Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd., McNeil Real Estate
     Fund XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund
     XXV,  L.P.  -  Superior  Court of the  State of  California,  County of Los
     Angeles,  Case No. BC133849 (Class Action  Complaint).  On January 7, 1997,
     this  action  was  consolidated  by court  order with  Scholfield,  et al.,
     referenced above.

4)   Warren Heller v. McNeil Partners,  L.P., McNeil Investors,  Inc., Robert A.
     McNeil,  Carole J. McNeil, McNeil Pacific Investors Fund 1972, Ltd., McNeil
     Real Estate Fund V, Ltd.,  McNeil  Real Estate Fund IX,  Ltd.,  McNeil Real
     Estate Fund X, Ltd.,  McNeil Real Estate Fund XI, Ltd.,  McNeil Real Estate
     Fund XIV, Ltd.,  McNeil Real Estate Fund XV, Ltd.,  McNeil Real Estate Fund
     XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund XXV,
     L.P. - Superior  Court of the State of  California,  County of Los Angeles,
     Case No. BC133957 (Class Action Complaint). On January 7, 1997, this action
     was consolidated by court order with Scholfield, et al., referenced above.

5)   Robert Lewis v. McNeil  Partners,  L.P.,  McNeil  Investors,  Inc.,  Robert
     A. McNeil et al. - In the District  Court of Dallas County,  Texas,  A-14th
     Judicial  District,  Cause No. 95-08535 (Class Action) - Plaintiff,  Robert
     Lewis, is a limited partner with McNeil Pacific  Investors Fund 1972, Ltd.,
     McNeil Real Estate Fund X, Ltd. and McNeil Real Estate Fund XV, Ltd.

<PAGE>
     On  April  11,  1996,  the  action  was  dismissed   without  prejudice  in
     anticipation  of  consolidation  with other  class  action  complaints.  On
     January  7,  1997,  this  action  was  consolidated  by  court  order  with
     Schofield, et al., referenced above.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
-------  ---------------------------------------------------

None.

                                     PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S UNITS OF LIMITED PARTNERSHIP AND
-------  ------------------------------------------------------------
         RELATED SECURITY HOLDER MATTERS
         -------------------------------

(A)     There is no established  public  trading market for limited  partnership
        units, nor is one expected to develop.

(B)     Title of Class                        Number of Record Unit Holders
        --------------                        -----------------------------

        Limited partnership units             3,287 as of January 31, 1997

(C)     Distributions  paid to limited  partners  totaled  $750,016 in 1996.  No
        distributions   were  paid  to  the  General  Partner  in  1996  and  no
        distributions  were paid to the limited  partners or General  Partner in
        1995.  See Item 7 -  Management's  Discussion  and Analysis of Financial
        Condition and Results of Operations, and Item 8 - Note 1 - "Organization
        and Summary of Significant Accounting Policies Distributions."



<PAGE>
ITEM 6.  SELECTED FINANCIAL DATA
-------  -----------------------

The  following  table sets forth a summary  of  certain  financial  data for the
Partnership.  This summary should be read in conjunction with the  Partnership's
financial  statements  and  notes  thereto  appearing  in  Item  8  -  Financial
Statements and Supplementary Data.

<TABLE>
<CAPTION>
Statements of                                             Years Ended December 31,
Operations                              1996           1995            1994           1993           1992
------------------                  -------------  -------------  --------------  -------------  -------------
<S>                                 <C>            <C>            <C>             <C>            <C>     
Rental revenue...............       $   4,136,447  $   4,058,503  $    4,127,396  $   3,903,950  $   4,174,958
Write-down for impairment
 of real estate..............            (700,000)    (1,500,085)              -              -              -
Loss before extraordinary
 items.......................            (608,182)    (1,694,787)        (65,511)       (30,846)      (260,259)
Extraordinary items..........                   -              -               -              -         51,510
Net loss.....................            (608,182)    (1,694,787)        (65,511)       (30,846)      (208,749)

Net loss per limited
 partnership unit:
Loss before extraordinary
 items.......................       $      (15.05)  $     (41.95) $        (1.62) $        (.76) $       (6.44)
Extraordinary items..........                   -              -               -              -           1.27
                                     ------------    -----------   -------------   ------------   ------------  

Net income (loss)............       $      (15.05)  $     (41.95) $        (1.62) $        (.76) $       (5.17)     
                                     ============    ===========   =============   ============   ============


Distributions per limited
 partnership unit............       $       18.75   $          -  $            -  $           -  $           - 
                                     ============    ===========   =============   ============   ============    

                                                              As of December 31,
Balance Sheets                          1996           1995            1994            1993           1992
--------------                      -------------  -------------  --------------  -------------  -------------

Real estate investments, net.       $   12,971,315  $ 22,816,356  $   25,251,693  $  25,836,338  $  26,303,508
Assets held for sale.........            8,408,672             -               -              -              -
Total assets.................           23,771,150    25,912,389      27,674,971     28,067,428     28,453,312
Mortgage note payable........            5,421,763     5,538,527       5,660,558      5,874,740      6,126,404
Partners' equity.............           17,981,105    19,339,303      21,034,090     21,099,601     21,130,447

</TABLE>


<PAGE>
ITEM 7.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-------      -----------------------------------------------------------
             AND RESULTS OF OPERATIONS
             -------------------------

FINANCIAL CONDITION
-------------------

The  Partnership was formed to engage in the business of acquiring and operating
income-producing  real  properties and holding the  properties  for  investment.
Since  completion of its capital  formation and property  acquisition  phases in
1985,  when it completed the purchase of seven  properties,  the Partnership has
operated its properties for production of income.

Southpointe  Plaza is an 83,506 square foot retail strip shopping center located
in the  southern  quadrant of  Sacramento,  California.  The  property is easily
accessible  and  highly  visible  from  the  highway.   The  declining  economic
conditions  in the adjacent  neighborhood  have  resulted in increased  criminal
activity.  The center has strong anchor tenants which, while doing well, seem to
be destination  stores and do not generate a lot of foot traffic for the center.
New shopping centers are being constructed to the south of the property, and one
of the  property's  anchor  tenants  opened a store in a new center located five
miles to the south.  Should the tenant decide to vacate  Southpointe  Plaza,  it
could have a severe negative impact on the future marketing of the smaller lease
space at the center.  Another  user of a pad site at the center has also decided
to relocate  their store to one of the newer  centers,  which could  result in a
sublease  to a less  desirable  tenant.  Although  occupancy  at the  center  is
projected to increase to the low to mid 90% range by the end of 1997, management
expects to reduce rents for tenants who are currently paying rents above market.
The  Partnership  has  determined  to begin an  orderly  liquidation  of all the
Partnership's  assets. In this regard,  the Partnership placed Southpointe Plaza
on the market for sale effective  October 1, 1996 and has received an offer from
a  non-affiliate  to purchase the center for $6.8 million.  Based on this offer,
the  Partnership  recorded a $700,000  write-down for impairment of value during
the fourth  quarter of 1996 to record the shopping  center at its estimated fair
value less costs to sell.  The shopping  center was  classified as an asset held
for sale by the Partnership at December 31, 1996.

Island Plaza,  a 60,076  square foot  single-story  strip  shopping  center,  is
located in Fort Myers, Florida. It is anchored by a grocery chain which occupies
30,800 square feet. Two new grocery-anchored shopping centers have recently been
developed within the area which have brought strong competition to Island Plaza.
The competitors'  grocery anchors occupy  approximately 65,000 square feet--more
than twice the square footage of Island Plaza's anchor. As a result, the grocery
anchor  tenant at Island  Plaza  has  filed  for  reorganization  under the U.S.
bankruptcy  laws. In order to keep the anchor open and maintain the viability of
Island Plaza,  it was necessary to negotiate a modification  of the lease during
1995,  resulting  in  a  reduction  in  rent.  Additionally,  road  construction
completed  during  1995 has moved the flow of  traffic  away from  Island  Plaza
toward the two new shopping centers previously described.  These events caused a
decline  in  anticipated  future  cash  flows  that  were  considered  to  be an
impairment; accordingly, the Partnership recorded a write-down for impairment of
real estate of $1,500,085 during the fourth quarter of 1995. The Partnership has
determined to begin an orderly  liquidation of all the Partnership's  assets. In
this  regard,  the  Partnership  placed  Island  Plaza  on the  market  for sale
effective  April 1,  1996 and has  received  an offer  from a  non-affiliate  to
purchase the center for $2.1 million.  The shopping  center was classified as an
asset held for sale by the Partnership at December 31, 1996.

<PAGE>
RESULTS OF OPERATIONS
---------------------

1996 compared to 1995

Revenue:

Total revenue increased by $90,253 in 1996 as compared to 1995. The increase was
due to an  increase  in rental  revenue  and a gain on  involuntary  conversion,
partially  offset by decreases in interest  income and property tax refunds,  as
discussed below.

Rental revenue for 1996  increased  slightly by $77,944 in relation to 1995. The
increase was mainly due to an approximately  $136,000 increase in rental revenue
at Springwood  Plaza due to an increase in occupancy in 1996.  This increase was
partially offset by a decrease of approximately $60,000 at Southpointe Plaza due
to a decrease in occupancy in 1996.  See Item 2 - Properties for a more detailed
analysis of occupancy and rents per square foot.

Interest  income  decreased by $18,116 in 1996 as compared to 1995. The decrease
was due to a lower  amount of cash  available  for  short-term  investment  as a
result of cash distributions paid to the limited partners in 1996.

A gain on involuntary  conversion of $45,134 was recognized in the first quarter
of 1996 relating to wind and hail damage suffered at Pine Hills  Apartments.  No
such gain was recognized in 1995.

In 1996, the  Partnership  received  $20,433 in refunds of prior years' property
taxes for Towne  Center  Shopping  Center.  In 1995,  the  Partnership  received
$35,142  in  refunds  of  prior  years'   property  taxes  for  Riverbay  Plaza,
Southpointe Plaza and Springwood Plaza shopping centers.

Expenses:

Total  expenses  decreased by $996,352 in 1996 as compared to 1995. The decrease
was mainly due to a greater  write-down  for  impairment  of real  estate  being
recorded  in 1995.  In  addition,  there  was a  decrease  in  depreciation  and
amortization and general and administrative - affiliates, partially offset by an
increase in other property operating expenses, as discussed below.

Depreciation and amortization expense for 1996 decreased by $176,093 in relation
to 1995.  The  decrease  was due to Island  Plaza and  Southpointe  Plaza  being
classified as assets held for sale by the  Partnership  effective  April 1, 1996
and October 1, 1996,  respectively.  In accordance with the Financial Accounting
Standards  Board's  Statement  of  Financial   Accounting   Standards  No.  121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed Of," the Partnership  ceased recording  depreciation on these assets
at the time they were placed on the market for sale.

Other property  operating  expenses increased by $110,678 in 1996 as compared to
1995.  The  increase  was  partially  due to an increase in bad debts due to the
bankruptcy  filing by a tenant at Southpointe  Plaza. In addition,  there was an
increase  in  amortization  of  leasing  commissions  in 1996.  Two  tenants  at
Southpointe  Plaza  and one  tenant at  Springwood  Plaza  vacated  prior to the
expiration  of their leases,  resulting in the balance of their prepaid  leasing
commissions being fully amortized in 1996.



<PAGE>
General  and  administrative  -  affiliates  for 1996  decreased  by $101,615 in
relation to 1995. The decrease was mainly due to a decrease in overhead expenses
allocated to the  Partnership  by McREMI.  In addition,  there was a decrease in
asset  management fees as a result of a decrease in the  Partnership's  tangible
asset value, on which the fees are based.

In 1996,  the  Partnership  recorded a $700,000  write-down  for  impairment  of
Southpointe  Plaza  Shopping  Center.  In  1995,  the  Partnership   recorded  a
$1,500,085 write-down for impairment of Island Plaza Shopping Center.

1995 compared to 1994

Revenue:

Total Partnership revenues increased by $18,582 in 1995 as compared to 1994. The
increase  was  primarily  due to a refund of  property  taxes and an increase in
interest income,  partially offset by a decrease in rental revenue, as discussed
below.

Rental revenue  decreased by $68,893 in 1995 in relation to 1994. Rental revenue
decreased by approximately $81,000 at Riverbay Plaza Shopping Center, mainly due
to the property receiving approximately $58,000 for land condemned by the county
in 1994. In addition,  there was a decrease in property  taxes billed to tenants
in 1995 due to a decrease  in the  assessed  taxable  value of the  property  by
taxing  authorities.  Rental revenue also decreased by approximately  $53,000 at
Island Plaza  Shopping  Center as a result of a reduction in rent charged to the
center's main anchor  tenant due to financial  difficulties  experienced  by the
tenant.  These decreases were partially offset by increases in rental revenue of
approximately  $31,000 and $33,000 at Pine Hills and Sleepy  Hollow  apartments,
respectively,  due  to an  increase  in  rental  rates  in  1995.  See  Item 2 -
Properties for a more detailed analysis of occupancy and rents per square foot.

Interest income increased by $52,333 in 1995 as compared to 1994,  primarily due
to a greater amount of cash available for short-term investment. The Partnership
held  approximately  $2.4 million of cash and cash  equivalents  at December 31,
1995, as compared to $1.7 million at December 31, 1994.  In addition,  there was
an increase in interest rates earned on invested cash in 1995.

In 1995, the  Partnership  received  $35,142 in refunds of prior years' property
taxes for  Riverbay  Plaza,  Southpointe  Plaza and  Springwood  Plaza  shopping
centers. No such refunds were received in 1994.

Expenses:

Total Partnership  expenses in 1995 increased by $1,647,858 as compared to 1994,
primarily due to a write-down  for  impairment of real estate and an increase in
general and administrative expenses, as discussed below.

Interest expense increased $52,901 in 1995 in relation to 1994. The increase was
primarily due to an increase in the adjustable  interest rate on the Southpointe
Plaza mortgage note payable.

Depreciation  and  amortization  expense  increased  by $76,508 in 1995 compared
to 1994 due to the  addition of depreciable capital improvements.





<PAGE>
Property  taxes  decreased by $72,242 in 1995 as compared to the prior year. The
decrease was primarily  attributable to a decrease in the assessed taxable value
of Riverbay Plaza,  Southpointe  Plaza and Springwood  Plaza shopping centers by
taxing  authorities as a result of an appeal filed by the  Partnership on behalf
of the properties.

Other  property  expenses  decreased by $64,217 in 1995 as compared to 1994. The
decrease was mainly due to a decrease in bad debt expense at  Southpointe  Plaza
and  Springwood  Plaza in 1995. In addition,  there was a higher amount of legal
fees  incurred at  Riverbay  Plaza in 1994  concerning  their  sewage  treatment
system.  Leasing  commissions  recognized  in  1995  were  less  than in 1994 at
Southpointe Plaza, due to a tenant vacating their space early in 1994.

General and administrative expenses increased by $142,903 in 1995 in relation to
1994.  The  increase was mainly due to  approximately  $122,000 in legal fees in
1995  relating to  evaluation  and  dissemination  of  information  regarding an
unsolicited  tender  offer as  discussed in Item 1 - Business and Item 3 - Legal
Proceedings.  In  addition,  the  Partnership  paid  $22,500 to settle a lawsuit
involving a former tenant's  lease.  Five  individuals  brought suit against the
Partnership  based on a purported  claim that the  Partnership and McREMI orally
promised to agree to extend their lease and approve an  assignment of lease from
three of the plaintiffs to two of the other plaintiffs for a restaurant and bar.
In April 1995, a settlement was reached such that the Partnership  agreed to pay
three of the plaintiffs  $42,500, of which $20,000 was paid by the Partnership's
insurance carrier.

In 1995,  the  Partnership  recorded a $1,500,085  write-down  for impairment of
Island Plaza Shopping Center. No such write-down was recorded in 1994.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

The  Partnership's  primary  source of cash flows is from  operating  activities
which  generated  $1,153,592  of cash  through  operating  activities  in  1996,
$1,215,207 in 1995 and $1,205,005 in 1994.

In 1996, the Partnership received $75,000 of net insurance proceeds for wind and
hail damage suffered at Pine Hills  Apartments.  The Partnership spent $484,810,
$432,154 and $706,253 on capital  additions  to its real estate  investments  in
1996,  1995 and 1994,  respectively.  The  increase in  expenditures  in 1994 in
relation to 1996 and 1995 was  primarily due to the  modification  of the sewage
treatment system at Riverbay Plaza in 1994.

The  Partnership  made a total of  $116,764,  $122,031 and $214,182 in principal
payments  on the  Southpointe  Plaza  mortgage  loan in  1996,  1995  and  1994,
respectively.  The  interest  rate on this loan  varies  monthly  as more  fully
discussed in Item 8 - Note 5 - "Mortgage Note  Payable."  Under the terms of the
mortgage  note  agreement,  the total  payment on the loan was  adjusted  by the
lender in 1994 and  again in 1995,  resulting  in a  decrease  in the  amount of
principal payments made on the loan in 1996 and 1995.

In 1996,  the  Partnership  repaid  $642,581 of advances  from  affiliates.  The
Partnership also distributed $750,016 to the limited partners in 1996.

Short-term liquidity:

At  December  31,  1996,  the  Partnership  held  cash and cash  equivalents  of
$1,615,604.  This balance provides a reasonable level of working capital for the
Partnership's immediate needs in operating its properties.
<PAGE>
For the  Partnership  as a whole,  management  projects  positive cash flow from
operations in 1997. The  Partnership has budgeted  approximately  $2 million for
necessary capital improvements for all properties in 1997, which are expected to
be funded from available cash reserves or from operations of the properties. The
present  cash  balance is believed to provide an adequate  reserve for  property
operations.

Additional efforts to maintain and improve  partnership  liquidity have included
continued attention to property management activities. The objective has been to
obtain maximum  occupancy  rates while holding  expenses to levels  necessary to
maximize  cash flows.  The  Partnership  has made  capital  expenditures  on its
properties where improvements were expected to increase the  competitiveness and
marketability of the properties.

Only one  property,  Southpointe  Plaza  Shopping  Center,  is  encumbered  with
mortgage debt. The  Partnership has placed  Southpointe  Plaza on the market for
sale and has received an offer from a  non-affiliate  to purchase the center for
$6.8  million.  When the mortgage  note matures in 1997,  the  Partnership  will
attempt to obtain  refinancing  or  extension  of the note until the property is
sold.

Long-term liquidity:

While the outlook for  maintenance of adequate levels of liquidity is favorable,
should operations  deteriorate and present cash resources become insufficient to
fund current  needs,  the  Partnership  would  require  other sources of working
capital.  No  such  sources  have  been  identified.   The  Partnership  has  no
established  lines of credit from outside  sources.  Other  possible  actions to
resolve cash deficiencies include refinancings, deferral of capital expenditures
on Partnership properties except where improvements are expected to increase the
competitiveness  and marketability of the properties,  arranging  financing from
affiliates or the ultimate sale of the properties.  Sales and  refinancings  are
possibilities only.

The Partnership  determined to evaluate market and other economic  conditions to
establish  the  optimum  time  to  commence  an  orderly   liquidation   of  the
Partnership's  assets in  accordance  with the terms of the Amended  Partnership
Agreement.  Taking such conditions as well as other pertinent  information  into
account,  the Partnership has determined to begin orderly liquidation of all its
assets.  Although there can be no assurance as to the timing of the  liquidation
due to real estate  market  conditions,  the general  difficulty of disposing of
real estate,  and other general  economic  factors,  it is anticipated that such
liquidation  would result in the  dissolution of the  Partnership  followed by a
liquidating  distribution  to the limited  partners by  December  1998.  In this
regard,  the Partnerships  has placed Island Plaza and Southpointe  Plaza on the
market for sale effective April 1, 1996 and October 1, 1996, respectively.

<PAGE>


ITEM 8.      FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
-------      -------------------------------------------
<TABLE>
<CAPTION>

                                                                                                       Page
                                                                                                      Number
                                                                                                      ------

INDEX TO FINANCIAL STATEMENTS
-----------------------------

Financial Statements:

<S>                                                                                                      <C>
   Report of Independent Public Accountants.......................................                       19

   Balance Sheets at December 31, 1996 and 1995...................................                       20

   Statements of Operations for each of the three years in the period
      ended December 31, 1996.....................................................                       21

   Statements of Partners' Equity (Deficit) for each of the three years
      in the period ended December 31, 1996.......................................                       22

   Statements of Cash Flows for each of the three years in the period
      ended December 31, 1996.....................................................                       23

   Notes to Financial Statements..................................................                       25

   Financial Statement Schedule -

      Schedule III - Real Estate Investments and Accumulated
         Depreciation and Amortization ...........................................                       34


</TABLE>



All other  schedules are omitted because they are not applicable or the required
information is shown in the financial statements or notes thereto.


<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Partners of McNeil Real Estate Fund XXIV, L.P.:

We have audited the accompanying balance sheets of McNeil Real Estate Fund XXIV,
L.P. (a California  limited  partnership)  as of December 31, 1996 and 1995, and
the related statements of operations,  partners' equity (deficit) and cash flows
for each of the  three  years in the  period  ended  December  31,  1996.  These
financial  statements and the schedule referred to below are the  responsibility
of the Partnership's management.  Our responsibility is to express an opinion on
these financial statements and the schedule based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial position of McNeil Real Estate Fund XXIV,
L.P. as of December 31, 1996 and 1995, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 1996, in
conformity with generally accepted accounting principles.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial  statements  taken as a whole.  The  schedule  listed  in the index to
financial  statements is presented for purposes of complying with the Securities
and  Exchange  Commission's  rules  and  is not  part  of  the  basic  financial
statements.  This schedule has been subjected to the auditing procedures applied
in our audits of the basic  financial  statements  and, in our  opinion,  fairly
states in all material  respects  the  financial  data  required to be set forth
therein in relation to the basic financial statements taken as a whole.


/s/  Arthur Andersen LLP


Dallas, Texas
   March 17, 1997



<PAGE>


                       McNEIL REAL ESTATE FUND XXIV, L.P.

                                 BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                   December 31,
                                                                       -----------------------------------
                                                                           1996                   1995
                                                                       ---------------        ------------
<S>                                                                    <C>                    <C>         
ASSETS
------

Real estate investments:

   Land.....................................................           $     2,409,114      $    6,781,836
   Buildings and improvements...............................                19,449,373          28,462,935
                                                                        --------------       -------------
                                                                            21,858,487          35,244,771
   Less:  Accumulated depreciation and amortization.........                (8,887,172)        (12,428,415)
                                                                        --------------       -------------
                                                                            12,971,315          22,816,356

Assets held for sale........................................                 8,408,672                   -

Cash and cash equivalents...................................                 1,615,604           2,381,183
Cash segregated for security deposits.......................                    82,466              94,780
Accounts receivable, net of allowance for doubtful
   accounts of $41,151 and $0 at December 31, 1996
   and 1995 respectively....................................                   550,752             433,580
Prepaid expenses and other assets, net......................                   142,341             186,490
                                                                        --------------       -------------
                                                                       $    23,771,150      $   25,912,389
                                                                        ==============       =============

LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
------------------------------------------

Mortgage note payable.......................................           $     5,421,763      $    5,538,527
Accounts payable and accrued expenses.......................                   202,045             229,628
Payable to affiliates - General Partner.....................                    74,343              59,527
Advances from affiliates....................................                         -             642,581
Security deposits and deferred rental revenue...............                    91,894             102,823
                                                                        --------------       -------------
                                                                             5,790,045           6,573,086
                                                                        --------------       -------------

Partners' equity (deficit):
   Limited partners - 40,000 limited partnership
     units authorized and outstanding at
     December 31, 1996 and 1995.............................                18,009,967          19,362,083
   General Partner..........................................                   (28,862)            (22,780)
                                                                        --------------       -------------
                                                                            17,981,105          19,339,303
                                                                        --------------       -------------
                                                                       $    23,771,150      $   25,912,389
                                                                        ==============       =============
</TABLE>

                 See accompanying notes to financial statements.
<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.

                            STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                              For the Years Ended December 31,
                                                   ----------------------------------------------------
                                                       1996                1995               1994
                                                   --------------     --------------    ---------------
Revenue:
<S>                                                <C>                <C>               <C>            
   Rental revenue..........................        $    4,136,447     $    4,058,503    $     4,127,396
   Interest................................               105,722            123,838             71,505
   Gain on involuntary conversion..........                45,134                  -                  -
   Property tax refund.....................                20,433             35,142                  -
                                                    -------------      -------------     --------------
     Total revenue.........................             4,307,736          4,217,483          4,198,901
                                                    -------------      -------------     --------------

Expenses:
   Interest................................               427,365            433,768            380,867
   Depreciation and amortization...........             1,191,313          1,367,406          1,290,898
   Property taxes..........................               423,275            402,569            474,811
   Personnel costs.........................               273,780            284,238            274,229
   Repairs and maintenance.................               399,778            421,102            451,727
   Property management fees -
     affiliates............................               226,592            232,136            235,662
   Utilities...............................               213,048            201,597            207,398
   Other property operating expenses.......               316,234            205,556            269,773
   General and administrative..............               195,970            213,635             70,732
   General and administrative -
     affiliates............................               548,563            650,178            608,315
   Write-down for impairment
     of real estate........................               700,000          1,500,085                  -
                                                    -------------      -------------     --------------
     Total expenses........................             4,915,918          5,912,270          4,264,412
                                                    -------------      -------------     --------------

Net loss...................................        $     (608,182)    $   (1,694,787)   $       (65,511)
                                                    =============      =============     ==============

Net loss allocable to limited partners.....        $     (602,100)    $   (1,677,839)   $       (64,856)
Net loss allocable to General Partner......                (6,082)           (16,948)              (655)
                                                    -------------      -------------     --------------
Net loss...................................        $     (608,182)    $   (1,694,787)   $       (65,511)
                                                    =============      =============     ==============


Net loss per limited partnership unit......        $       (15.05)    $       (41.95)   $         (1.62)
                                                    =============      =============     ==============

Distributions per limited partnership
   unit....................................        $        18.75     $            -    $             -
                                                    =============      =============     ==============
</TABLE>
                 See accompanying notes to financial statements.

<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.

                    STATEMENTS OF PARTNERS' EQUITY (DEFICIT)

              For the Years Ended December 31, 1996, 1995 and 1994

<TABLE>
<CAPTION>
                                                                                                    Total
                                                    General                 Limited               Partners'
                                                    Partner                 Partners               Equity
                                                 ---------------         ---------------       ---------------
<S>                                              <C>                     <C>                   <C>           
Balance at December 31, 1993..............       $       (5,177)         $   21,104,778        $   21,099,601

Net loss..................................                 (655)                (64,856)              (65,511)
                                                  -------------           -------------         -------------

Balance at December 31, 1994..............               (5,832)             21,039,922            21,034,090

Net loss..................................              (16,948)             (1,677,839)           (1,694,787)
                                                  --------------          -------------         -------------

Balance at December 31, 1995..............              (22,780)             19,362,083            19,339,303

Net loss..................................               (6,082)               (602,100)             (608,182)

Distributions.............................                    -                (750,016)             (750,016)
                                                  -------------           -------------         -------------

Balance at December 31, 1996..............       $      (28,862)         $   18,009,967        $   17,981,105
                                                  =============           =============         =============
</TABLE>


                 See accompanying notes to financial statements.
<PAGE>

                       McNEIL REAL ESTATE FUND XXIV, L.P.

                            STATEMENTS OF CASH FLOWS

                Increase (Decrease) in Cash and Cash Equivalents



<TABLE>
<CAPTION>
                                                            For the Years Ended December 31,
                                                   -----------------------------------------------------
                                                        1996                1995              1994
                                                   ---------------    ---------------   ----------------
Cash flows from operating activities:
<S>                                                <C>                <C>               <C>            
   Cash received from tenants..............        $    3,977,657     $    4,050,223    $     4,140,189
   Cash paid to suppliers..................            (1,370,950)        (1,323,776)        (1,258,002)
   Cash paid to affiliates.................              (760,339)          (861,503)          (838,624)
   Interest received.......................               105,722            123,838             71,505
   Interest paid...........................              (398,254)          (399,056)          (349,155)
   Property taxes paid.....................              (420,677)          (409,661)          (560,908)
   Property tax refund.....................                20,433             35,142                  -
                                                    -------------      -------------     --------------
Net cash provided by operating
   activities..............................             1,153,592          1,215,207          1,205,005
                                                    -------------      -------------     --------------

Cash flows from investing activities:
   Net proceeds received from
     insurance company.....................                75,000                  -                  -
   Additions to real estate
     investments...........................              (484,810)          (432,154)          (706,253)
                                                    -------------      -------------     --------------
Net cash used in investing activities......              (409,810)          (432,154)          (706,253)
                                                    -------------      -------------     --------------

Cash flows from financing activities:
   Principal payments on mortgage
     note payable..........................              (116,764)          (122,031)          (214,182)
   Repayment of advances from
     affiliates............................              (642,581)                 -                  -
   Distributions paid......................              (750,016)                 -                  -
                                                    -------------      -------------     --------------
Net cash used in financing activities......            (1,509,361)          (122,031)          (214,182)
                                                    -------------      -------------     --------------

Net increase (decrease) in cash
   and cash equivalents....................              (765,579)           661,022            284,570

Cash and cash equivalents at
   beginning of year.......................             2,381,183          1,720,161          1,435,591
                                                    -------------      -------------     --------------

Cash and cash equivalents at end
   of year.................................        $    1,615,604     $    2,381,183    $     1,720,161
                                                    =============      =============     ==============
</TABLE>


See discussion of noncash  investing and financing  activities in Note 4 - "Real
Estate Investments."



                 See accompanying notes to financial statements.
<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.

                            STATEMENTS OF CASH FLOWS


               Reconciliation of Net Loss to Net Cash Provided by
                              Operating Activities


<TABLE>
<CAPTION>
                                                             For the Years Ended December 31,
                                                   -----------------------------------------------------
                                                       1996                 1995               1994
                                                   ---------------    ---------------   ----------------
<S>                                                <C>                <C>               <C>             
Net loss...................................        $     (608,182)    $   (1,694,787)   $       (65,511)
                                                    -------------      -------------     --------------

Adjustments to reconcile net loss
   to net cash provided by operating
   activities:
   Depreciation and amortization...........             1,191,313          1,367,406          1,290,898
   Allowance for doubtful accounts.........                41,151            (77,044)            (7,956)
   Amortization of deferred borrowing
     costs.................................                31,079             31,079             31,079
   Amortization of deferred gain...........                     -            (17,000)           (20,400)
   Gain on involuntary conversion..........               (45,134)                 -                  -
   Write-down for impairment
     of real estate........................               700,000          1,500,085                  -
   Changes in assets and liabilities:
     Cash segregated for security deposits.                12,314             (8,929)            (2,083)
     Accounts receivable...................              (158,323)            44,989             49,399
     Prepaid expenses and other
       assets, net.........................                13,070             (1,828)            21,943
     Accounts payable and accrued
       expenses............................               (27,583)            35,015            (93,507)
     Payable to affiliates - General
       Partner.............................                14,816             20,811              5,353
     Security deposits and deferred
       rental revenue......................               (10,929)            15,410             (4,210)
                                                    -------------      -------------     --------------

         Total adjustments.................             1,761,774          2,909,994          1,270,516
                                                    -------------      -------------     --------------

Net cash provided by operating
   activities..............................        $    1,153,592     $    1,215,207    $     1,205,005
                                                    =============      =============     ==============
</TABLE>

                 See accompanying notes to financial statements.
<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 1996

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------

Organization
------------

McNeil  Real Estate  Fund XXIV,  L.P.  (the  "Partnership"),  formerly  known as
Southmark Equity Partners, Ltd., was organized on October 19, 1984, as a limited
partnership under the provisions of the California  Revised Limited  Partnership
Act to acquire and operate  commercial and residential  properties.  The general
partner of the Partnership is McNeil Partners,  L.P. ( the "General Partner"), a
Delaware  limited  partnership,  an affiliate  of Robert A. McNeil.  The General
Partner was elected at a meeting of limited partners on March 30, 1992, at which
time an amended and restated  partnership  agreement  (the "Amended  Partnership
Agreement") was adopted. The principal place of business for the Partnership and
the General Partner is 13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240.

The Partnership is engaged in diversified real estate activities,  including the
ownership,  operation and management of residential  and commercial  properties.
The Partnership  determined to evaluate market and other economic  conditions to
establish  the  optimum  time  to  commence  an  orderly   liquidation   of  the
Partnership's  assets in  accordance  with the terms of the Amended  Partnership
Agreement.  At December 31, 1996, the Partnership  owned seven  income-producing
properties  as  described  in Note 4 -  "Real  Estate  Investments."  Six of the
Partnership's  seven properties were acquired in transactions  involving payment
of all cash to the sellers. A large portion of the Partnership's  rental revenue
is attributable to one property,  Southpointe Plaza Shopping Center. Southpointe
Plaza Shopping Center  contributed  approximately  27% of the total  Partnership
rental revenue in 1996 and 30% in 1995 and 1994.

Basis of Presentation
---------------------

The  accompanying  financial  statements  have been prepared in conformity  with
generally accepted accounting principles ("GAAP").  The preparation of financial
statements in conformity  with GAAP  requires  management to make  estimates and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

Real Estate Investments
-----------------------

Real estate investments are generally stated at the lower of depreciated cost or
fair value. Real estate investments are reviewed for impairment  whenever events
or changes in  circumstances  indicate  that their  carrying  amounts may not be
recoverable.  When the  carrying  value  of a  property  exceeds  the sum of all
estimated  future cash flows, an impairment loss is recognized.  At such time, a
write-down  is  recorded to reduce the basis of the  property  to its  estimated
recoverable amount.


<PAGE>
The  Partnership's  method  of  accounting  for real  estate  investments  is in
accordance with Statement of Financial Accounting Standards No. 121, "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of" ("SFAS 121"),  which the Partnership  adopted effective January 1, 1996. The
adoption  of  SFAS  121 did  not  have a  material  impact  on the  accompanying
financial statements.

Improvements and betterments are capitalized and expensed  through  depreciation
charges. Repairs and maintenance are charged to operations as incurred.

Assets Held for Sale
--------------------

Assets held for sale are stated at the lower of  depreciated  cost or fair value
less costs to sell.  Depreciation  on these  assets  ceases at the time they are
placed on the market for sale.

Depreciation and Amortization
-----------------------------

Buildings and improvements are depreciated using the  straight-line  method over
the  estimated  useful lives of the assets,  ranging from 5 to 25 years.  Tenant
improvements  are  capitalized  and are amortized  over the terms of the related
tenant lease, using the straight-line method.

Cash and Cash Equivalents
-------------------------

Cash and cash equivalents  include cash on hand and cash on deposit in financial
institutions with original  maturities of three months or less. Carrying amounts
for cash and cash equivalents approximate fair value.

Deferred Borrowing Costs
------------------------

Loan fees and other related costs incurred to obtain long-term financing on real
property are capitalized  and are included in prepaid  expenses and other assets
on the Balance Sheets. Amortization is recorded using a method that approximates
the  effective  interest  method  over the  term of the  related  mortgage  note
payable.  Amortization  of  deferred  borrowing  costs is  included  in interest
expense on the Statements of Operations.

Rental Revenue
--------------

The Partnership  leases its residential  properties under  short-term  operating
leases. Lease terms generally are less than one year in duration. Rental revenue
is recognized as earned.

The Partnership leases its commercial properties under non-cancelable  operating
leases.  Certain leases provide concessions and/or periods of escalating or free
rent. Rental revenue is recognized on a straight-line basis over the life of the
related leases. The excess of the rental revenue recognized over the contractual
rental  payments  is  recorded  as accrued  rent  receivable  and is included in
accounts receivable on the Balance Sheets.




<PAGE>
Income Taxes
------------

No provision for Federal  income taxes is necessary in the financial  statements
of the  Partnership  because,  as a  partnership,  it is not  subject to Federal
income tax and the tax effect of its activities accrues to the partners.

Allocation of Net Income and Net Loss
-------------------------------------

The Amended  Partnership  Agreement  generally  provides that net income and net
loss  (other  than  net  income  arising  from  sales or  refinancing)  shall be
allocated 1% to the General Partner and 99% to the limited partners.

For financial statement  purposes,  net income arising from sales or refinancing
shall be allocated 1% to the General Partner and 99% to the limited partners.

For tax reporting  purposes,  net income arising from sales or refinancing shall
be  allocated  as  follows:  (a)  first,  amounts  of such net  income  shall be
allocated among the General  Partner and limited  partners in proportion to, and
to the extent of, the  portion of such  partners'  share of the net  decrease in
Partnership Minimum Gain determined under Treasury  Regulations,  (b) second, to
the General Partner and limited partners in proportion to, and to the extent of,
the amount by which their  respective  capital account  balances are negative by
more than their respective  remaining shares of the  Partnership's  Minimum Gain
attributable  to properties  still owned by the Partnership and (c) third, 1% of
such net income shall be  allocated  to the General  Partner and 99% of such net
income shall be allocated to the limited partners.

Federal  income tax law provides  that the  allocation of loss to a partner will
not be  recognized  unless the  allocation  is in  accordance  with a  partner's
interest in the partnership or the allocation has substantial  economic  effect.
Internal  Revenue  Code Section  704(b) and  accompanying  Treasury  Regulations
establish  criteria for allocation of  Partnership  deductions  attributable  to
debt. The  Partnership's tax allocations for 1996, 1995, and 1994 have been made
in accordance with these provisions.

Distributions
-------------

At the discretion of the General  Partner,  distributable  cash (other than cash
from sales or  refinancing)  shall be distributed to the limited  partners until
the limited partners have received distributions of cash flow equal to a 10% per
annum cumulative on their Adjusted Invested Capital,  as defined,  and then 100%
to the limited  partners as a class.  At the discretion of the General  Partner,
cash from sales or refinancing shall be distributed to limited partners: (first)
in an amount  which when added to prior  distributions  from all sources to such
limited partners is equal to a cumulative preferred return of 10% per annum; and
(second)  to  limited   partners  in  an  amount   which  when  added  to  prior
distributions  of cash from sales and  refinancing  to such limited  partners is
equal to such limited  partners'  Original  Invested  Capital,  as defined;  and
(third) to the  limited  partners  on a per limited  partnership  unit  ("Unit")
basis.

In connection  with a  Terminating  Disposition  as defined,  cash from sales or
refinancing and any remaining reserves shall be allocated among, and distributed
to, the General Partner and limited partners in proportion to, and to the extent
of,  their  positive  capital  account  balances  after the net  income has been
allocated pursuant to the above.
<PAGE>
The  Partnership  distributed  $750,016  to the  limited  partners  in 1996.  No
distributions were made to the partners in 1995 or 1994.

Net Loss Per Limited Partnership Unit
-------------------------------------

Net loss per limited partnership unit is computed by dividing net loss allocated
to the limited partners by the weighted average number of Units outstanding. Per
Unit  information  has been computed based on 40,000 Units  outstanding in 1996,
1995 and 1994.

Reclassifications
-----------------

Certain  reclassifications  have been made to prior year amounts to conform with
the current year presentation.

NOTE 2 - TRANSACTIONS WITH AFFILIATES
-------------------------------------

The  Partnership  pays property  management fees equal to 5% of the gross rental
receipts for its residential  properties and 6% of gross rental receipts for its
commercial  properties to McNeil Real Estate  Management,  Inc.  ("McREMI"),  an
affiliate of the General Partner, for providing property management services for
the Partnership's residential and commercial properties and leasing services for
its residential  properties.  McREMI may also choose to provide leasing services
for the Partnership's  commercial properties,  in which case McREMI will receive
property  management  fees from such  commercial  properties  equal to 3% of the
property's  gross  rental  receipts  plus  leasing   commissions  based  on  the
prevailing market rate for such services where the property is located.

The  Partnership  reimburses  McREMI  for  its  costs,  including  overhead,  of
administering the Partnership's affairs.


Under the terms of the Amended Partnership Agreement,  the Partnership is paying
an  asset  management  fee to the  General  Partner.  Through  1999,  the  asset
management  fee is calculated as 1% of the  Partnership's  tangible asset value.
Tangible  asset  value is  determined  by using  the  greater  of (i) an  amount
calculated by applying a capitalization  rate of 9 percent to the annualized net
operating  income of each property or (ii) a value of $10,000 per apartment unit
for  residential  properties  and $50  per  gross  square  foot  for  commercial
properties to arrive at the property tangible asset value. The property tangible
asset  value is then  added to the book  value  of all  other  assets  excluding
intangible items. The fee percentage decreases subsequent to 1999.


<PAGE>
Compensation  and  reimbursements  paid to or  accrued  for the  benefit  of the
General Partner or its affiliates are as follows:

<TABLE>
<CAPTION>
                                                          For the Years Ended December 31,
                                                   ----------------------------------------------------
                                                       1996                1995               1994
                                                   --------------     --------------    ---------------
<S>                                                <C>                <C>               <C>            
Property management fees...................        $      226,592     $      232,136    $       235,662
Charged to general and administrative -
   affiliates:
   Partnership administration..............               233,066            310,258            291,507
   Asset management fee....................               315,497            339,920            316,808
                                                    -------------      -------------     --------------
                                                   $      775,155     $      882,314    $       843,977
                                                    =============      =============     ==============
</TABLE>

In 1996, the Partnership  repaid $642,581 of  noninterest-bearing  advances from
affiliates.

Payable to affiliates - General  Partner at December 31, 1996 and 1995 consisted
primarily  of  unpaid  property   management  fees,   Partnership   general  and
administrative  expenses and asset  management fees and are due and payable from
current operations.

NOTE 3 - TAXABLE INCOME (LOSS)
------------------------------

McNeil  Real  Estate  Fund XXIV,  L.P.  is a  partnership  and is not subject to
Federal and state income taxes.  Accordingly,  no recognition  has been given to
income taxes in the accompanying  financial  statements of the Partnership since
the income or loss of the  Partnership  is to be  included in the tax returns of
the  individual  partners.  The tax  returns of the  Partnership  are subject to
examination by Federal and state taxing authorities. If such examinations result
in  adjustments  to  distributive  shares of  taxable  income  or loss,  the tax
liability of the partners could be adjusted accordingly.

The  Partnership's  net assets and liabilities for tax purposes exceeded the net
assets and liabilities for financial  reporting  purposes by $6,081,071 in 1996,
$5,490,840 in 1995 and $4,043,975 in 1994.


<PAGE>
NOTE 4 - REAL ESTATE INVESTMENTS
--------------------------------

The  basis  and  accumulated  depreciation  of  the  Partnership's  real  estate
investments at December 31, 1996 and 1995 are set forth in the following tables:

<TABLE>
<CAPTION>
                                                                       Accumulated
                                                   Buildings and       Depreciation          Net Book
       1996                         Land           Improvements      and Amortization          Value
       ----                    --------------      ------------      ----------------     ---------------
<S>                            <C>                 <C>                 <C>                 <C>           
Pine Hills Apartments
   Livingston, TX              $      605,145      $    3,735,664      $   (1,756,654)     $    2,584,155
Riverbay Plaza
   Riverview, FL                      294,546           5,670,698          (2,495,310)          3,469,934
Sleepy Hollow Apartments
   Cleveland, TX                      363,051           4,297,494          (1,952,845)          2,707,700
Springwood Plaza
   Dellwood, MO                       784,767           3,579,942          (1,605,337)          2,759,372
Towne Center
   Derby, KS                          361,605           2,165,575          (1,077,026)          1,450,154
                                -------------       -------------       -------------       -------------

                               $    2,409,114      $   19,449,373      $   (8,887,172)     $   12,971,315
                                =============       =============       =============       =============


                                                                       Accumulated
                                                   Buildings and       Depreciation          Net Book
       1995                         Land           Improvements      and Amortization          Value
       ----                    --------------      ------------      ----------------     ---------------

Island Plaza                   $      832,191     $     3,100,907      $   (1,897,524)     $    2,035,574
Pine Hills Apartments                 605,145           3,698,238          (1,584,751)          2,718,632
Riverbay Plaza                        294,546           5,666,314          (2,246,406)          3,714,454
Sleepy Hollow Apartments              363,051           4,240,757          (1,747,160)          2,856,648
Southpointe Plaza                   3,540,531           6,320,334          (2,535,506)          7,325,359
Springwood Plaza                      784,767           3,282,809          (1,433,389)          2,634,187
Towne Center                          361,605           2,153,576            (983,679)          1,531,502
                                -------------       -------------       -------------       -------------

                               $    6,781,836     $    28,462,935      $  (12,428,415)     $   22,816,356
                                =============      ==============       =============       =============
</TABLE>


Island Plaza, a 60,076 square foot  single-story  strip  shopping  center in Ft.
Myers,  Florida,  is anchored by a grocery  chain which  occupies  30,800 square
feet.  Two new  grocery-anchored  shopping  centers have recently been developed
within the area which have  brought  strong  competition  to Island  Plaza.  The
competitors'  grocery anchors occupy approximately 65,000 square feet--more than
twice the square  footage of Island  Plaza's  anchor.  As a result,  the grocery
anchor  tenant at Island  Plaza  has  filed  for  reorganization  under the U.S.
bankruptcy  laws. In order to keep the anchor open and maintain the viability of
Island Plaza, it was necessary to negotiate a modification of the lease in 1995,
resulting  in a reduction in rent.  Additionally,  road  construction  completed

<PAGE>
during 1995 has moved the flow of traffic  away from Island Plaza toward the two
new shopping  centers  previously  described.  These events  caused a decline in
future cash flows that was  considered  to be an  impairment;  accordingly,  the
Partnership  recorded a write-down  for  impairment  of the asset of  $1,500,085
during the fourth  quarter of 1995. The  Partnership  has determined to begin an
orderly  liquidation  of all  the  Partnership's  assets.  In this  regard,  the
Partnership  placed Island Plaza on the market for sale effective  April 1, 1996
and has received an offer from a  non-affiliate  to purchase the center for $2.1
million.  Accordingly,  the shopping  center was classified as an asset held for
sale by the Partnership at December 31, 1996. The net book value of Island Plaza
was $2,016,188 at December 31, 1996.

Southpointe  Plaza is an 83,506 square foot retail strip shopping center located
in the  southern  quadrant of  Sacramento,  California.  The  property is easily
accessible  and  highly  visible  from  the  highway.   The  declining  economic
conditions  in the adjacent  neighborhood  have  resulted in increased  criminal
activity.  The center has strong anchor tenants which, while doing well, seem to
be destination  stores and do not generate a lot of foot traffic for the center.
New shopping centers are being constructed to the south of the property, and one
of the  property's  anchor  tenants  opened a store in a new center located five
miles to the south.  Should the tenant decide to vacate  Southpointe  Plaza,  it
could have a severe negative impact on the future marketing of the smaller lease
space at the center.  Another  user of a pad site at the center has also decided
to relocate  their store to one of the newer  centers,  which could  result in a
sublease  to a less  desirable  tenant.  Although  occupancy  at the  center  is
projected to increase to the low to mid 90% range by the end of 1997, management
expects to reduce rents for tenants who are currently paying rents above market.
The  Partnership  has  determined  to begin an  orderly  liquidation  of all the
Partnership's  assets. In this regard,  the Partnership placed Southpointe Plaza
on the market for sale effective  October 1, 1996 and has received an offer from
a  non-affiliate  to purchase the center for $6.8 million.  Based on this offer,
the  Partnership  recorded a $700,000  write-down for impairment of value during
the fourth  quarter of 1996 to record the shopping  center at its estimated fair
value less costs to sell.  The shopping  center was  classified as an asset held
for  sale by the  Partnership  at  December  31,  1996.  The net  book  value of
Southpointe Plaza was $6,392,484 at December 31, 1996.

The results of operations for the assets held for sale at December 31, 1996 were
$167,511,  $118,740 and $154,310 for 1996, 1995 and 1994, respectively.  Results
of  operations  are  operating   revenues  less  operating   expenses  including
depreciation and interest expense.

In December 1995, wind and hail damage occurred at Pine Hills Apartments. During
1996,  reimbursements totaling $75,000 were received from the insurance carrier,
and repairs to the property were completed.  In 1996, the Partnership recognized
a  $45,134  gain on  involuntary  conversion,  which  represents  the  amount of
insurance  reimbursements  received  in  excess  of the  basis  of the  property
damaged.

In February  1997,  a fire  occurred  at Riverbay  Plaza  Shopping  Center.  One
tenant's space (less than 3% of the total leasable square footage of the center)
was completely destroyed. In addition,  there was damage to the roof and several
tenant spaces incurred water and smoke damage.  The total cost of repairs cannot
be  determined  at this time.  Management  expects the  majority of the repairs,
excluding  a $25,000  deductible,  will be covered by the  property's  insurance
carrier.



<PAGE>
The Partnership leases its commercial properties under non-cancelable  operating
leases.  Future  minimum  rents to be received  as of  December  31, 1996 are as
follows:

                                       Real Estate            Assets Held
                                       Investments              For Sale
                                     --------------         ---------------

    1997.....................        $    1,047,000         $     1,072,000
    1998.....................               858,000                 870,000
    1999.....................               706,000                 837,000
    2000.....................               443,000                 807,000
    2001.....................               390,000                 729,000
    Thereafter...............             2,260,000               1,500,000
                                      -------------          --------------
      Total                          $    5,704,000         $     5,815,000
                                      =============          ==============

Future minimum rents do not include  contingent rentals based on sales volume of
tenants.  Contingent rents amounted to $32,518,  $8,426 and $7,809 for the years
ended December 31, 1996, 1995 and 1994, respectively.  Future minimum rents also
do not include  expense  reimbursements  for common area  maintenance,  property
taxes and other  expenses.  These expense  reimbursements  amounted to $548,716,
$444,862  and $487,347  for the years ended  December  31, 1996,  1995 and 1994,
respectively.  These contingent rents and expense reimbursements,  which include
amounts  related to the assets held for sale,  are included in rental revenue on
the Statements of Operations.

NOTE 5 - MORTGAGE NOTE PAYABLE
------------------------------

The following sets forth the mortgage note payable of the  Partnership,  related
to  Southpointe  Plaza  Shopping  Center,  at December  31,  1996 and 1995.  The
mortgage note payable is secured by the related real estate investment.

<TABLE>
<CAPTION>
                         Mortgage         Annual          Monthly
                         Lien             Interest        Payments/                   December 31,
Property                 Position (a)Rate %(b)            Maturity                1996               1995
--------                 ---------------------         -----------------     ---------------   ------------
<S>                      <C>              <C>          <C>     <C>           <C>               <C>         
Southpointe Plaza        First            7.089        $42,703 4/97          $   5,421,763     $  5,538,527
                                                                              ============      ===========
</TABLE>

(a)    The debt is non-recourse to the Partnership.

(b)    The interest rate varies  monthly based on the monthly  weighted  average
       cost of savings, borrowings and advances by the Federal Home Loan Bank of
       San Francisco,  with a minimum rate of 5% and a maximum  interest rate of
       13%. The rate listed  above  represents  the  interest  rate in effect at
       December 31, 1996.

The  Partnership  has  placed  Southpointe  Plaza on the market for sale and has
received an offer from a non-affiliate  to purchase the center for $6.8 million.
When the mortgage note matures in 1997, the  Partnership  will attempt to obtain
refinancing or extension of the note until the property is sold.

<PAGE>
Based on borrowing rates  currently  available to the Partnership for a mortgage
loan with similar terms and average  maturities,  the fair value of the mortgage
note payable was approximately $5,081,000 at December 31, 1996 and $5,170,000 at
December 31, 1995.

NOTE 6 - LEGAL PROCEEDINGS
--------------------------

The Partnership is not party to, nor are any of the Partnership's properties the
subject of, any material pending legal proceedings, other than ordinary, routine
litigation incidental to the Partnership's business, except for the following:

1)   Martha Hess, et al. v. Southmark Equity Partners II, Ltd., Southmark Income
     Investors, Ltd., Southmark Equity Partners, Ltd. (presently known as McNeil
     Real Estate Fund XXIV,  L.P.),  Southmark  Realty  Partners III,  Ltd., and
     Southmark Realty Partners II, Ltd., et al. ("Hess");  Kotowski v. Southmark
     Equity Partners, Ltd. and Donald Arceri v. Southmark Income Investors, Ltd.
     The Hess case was filed on May 20, 1988, by Martha Hess,  individually  and
     on behalf of a putative class of those  similarly  situated.  The original,
     first,  second and third  amended  complaints  in Hess  sought  rescission,
     pursuant to the Illinois  Securities Act, of over $2.7 million of principal
     invested in five  Southmark  (now  McNeil)  partnerships,  and other relief
     including  damages  for  breach  of  fiduciary  duty and  violation  of the
     Illinois Consumer Fraud and Deceptive Business Practices Act. The original,
     first,  second and third amended  complaints in Hess were dismissed against
     the defendant-group because the Appellate Court held that they were not the
     proper subject of a class action complaint. Hess was, thereafter, amended a
     fourth  time to  state  causes  of  action  against  unrelated  partnership
     entities. Hess went to judgment against that entity and the judgment, along
     with the prior  dismissals  of the class action,  was appealed.  The claims
     against the Partnership were dismissed by the Appellate Court.

2)   James F. Schofield, Gerald C. Gillett, Donna S. Gillett, Jeffrey Homburger,
     Elizabeth Jung,  Robert Lewis,  and Warren Heller et al. v. McNeil Partners
     L.P., McNeil Investors,  Inc., McNeil Real Estate Management,  Inc., Robert
     A. McNeil,  Carole J. McNeil,  McNeil Pacific  Investors  Fund 1972,  Ltd.,
     McNeil Real Estate Fund IX, Ltd.,  McNeil Real Estate Fund X, Ltd.,  McNeil
     Real Estate Fund XI, Ltd.,  McNeil Real Estate Fund XII, Ltd.,  McNeil Real
     Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd., McNeil Real Estate
     Fund XX, L.P.,  McNeil Real Estate Fund XXI, L.P.,  McNeil Real Estate Fund
     XXII,  L.P.,  McNeil Real Estate Fund XXIV,  L.P.,  McNeil Real Estate Fund
     XXV, L.P.,  McNeil Real Estate Fund XXVI, L.P., and McNeil Real Estate Fund
     XXVII,  L.P., et al. - Superior  Court of the State of  California  for the
     County of Los  Angeles,  Case No.  BC133799  (Class and  Derivative  Action
     Complaint).

     The action  involves  purported  class and  derivative  actions  brought by
     limited  partners of each of the fourteen  limited  partnerships  that were
     named as nominal  defendants as listed above (as defined in this Section 2,
     the  "Partnerships").  Plaintiffs allege that McNeil  Investors,  Inc., its
     affiliate  McNeil Real Estate  Management,  Inc.  and three of their senior
     officers and/or directors (as defined in this Section 2, collectively,  the
     "Defendants") breached their fiduciary duties and certain obligations under
     the  respective  amended  partnership  agreements.  Plaintiffs  allege that
     Defendants  have  rendered  such Units  highly  illiquid  and  artificially




<PAGE>
     depressed  the prices that are  available  for Units on the resale  market.
     Plaintiffs  also allege that  Defendants  engaged in a course of conduct to
     prevent  the  acquisition  of  Units  by an  affiliate  of  Carl  Icahn  by
     disseminating  purportedly  false,  misleading and inadequate  information.
     Plaintiffs  further  allege  that  Defendants  acted to  advance  their own
     personal interests at the expense of the Partnerships'  public unit holders
     by failing to sell Partnership properties and failing to make distributions
     to unitholders.

     On December 16,  1996,  the  plaintiffs  filed a  consolidated  and amended
     complaint.  Plaintiffs  are suing for breach of fiduciary  duty,  breach of
     contract  and  an  accounting,  alleging,  among  other  things,  that  the
     management  fees paid to the McNeil  affiliates over the last six years are
     excessive,  that these fees  should be reduced  retroactively  and that the
     respective amended  partnership  agreements  governing the Partnerships are
     invalid.  On January 7, 1997,  the Court ordered  consolidation  with three
     other similar actions listed below.

     The  Partnerships  filed a demurrer to the complaint and a motion to strike
     on February 14, 1997, seeking to dismiss the complaint in all respects. The
     demurrer is pending.  The Partnerships  deny that there is any merit to the
     plaintiffs' allegations and intend to vigorously defend this action.

3)   Alfred Napoletano v. McNeil Partners, L.P., McNeil Investors,  Inc., Robert
     A. McNeil,  Carole J. McNeil,  McNeil Pacific  Investors  Fund 1972,  Ltd.,
     McNeil Real Estate Fund V, Ltd.,  McNeil Real Estate Fund IX, Ltd.,  McNeil
     Real Estate Fund X, Ltd.,  McNeil  Real Estate Fund XI,  Ltd.,  McNeil Real
     Estate Fund XIV, Ltd., McNeil Real Estate Fund XV, Ltd., McNeil Real Estate
     Fund XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund
     XXV,  L.P.  -  Superior  Court of the  State of  California,  County of Los
     Angeles,  Case No. BC133849 (Class Action  Complaint).  On January 7, 1997,
     this  action  was  consolidated  by court  order with  Scholfield,  et al.,
     referenced above.

4)   Warren Heller v. McNeil Partners,  L.P., McNeil Investors,  Inc., Robert A.
     McNeil,  Carole J. McNeil, McNeil Pacific Investors Fund 1972, Ltd., McNeil
     Real Estate Fund V, Ltd.,  McNeil  Real Estate Fund IX,  Ltd.,  McNeil Real
     Estate Fund X, Ltd.,  McNeil Real Estate Fund XI, Ltd.,  McNeil Real Estate
     Fund XIV, Ltd.,  McNeil Real Estate Fund XV, Ltd.,  McNeil Real Estate Fund
     XX, L.P.,  McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund XXV,
     L.P. - Superior  Court of the State of  California,  County of Los Angeles,
     Case No. BC133957 (Class Action Complaint). On January 7, 1997, this action
     was consolidated by court order with Scholfield, et al., referenced above.

5)   Robert Lewis v. McNeil Partners,  L.P.,  McNeil   Investors,  Inc.,  Robert
     A. McNeil et al. - In the District  Court of Dallas County,  Texas,  A-14th
     Judicial  District,  Cause No. 95-08535 (Class Action) - Plaintiff,  Robert
     Lewis, is a limited partner with McNeil Pacific  Investors Fund 1972, Ltd.,
     McNeil Real Estate Fund X, Ltd. and McNeil Real Estate Fund XV, Ltd.

     On  April  11,  1996,  the  action  was  dismissed   without  prejudice  in
     anticipation  of  consolidation  with other  class  action  complaints.  On
     January  7,  1997,  this  action  was  consolidated  by  court  order  with
     Schofield, et al., referenced above.





<PAGE>
6)   McNeil  Pacific  Investors  Fund   1972,  Ltd.,  McNeil Real Estate Fund V,
     Ltd.,  McNeil Real Estate Fund IX,  Ltd.,  McNeil Real Estate Fund X, Ltd.,
     McNeil Real Estate Fund XI, Ltd., McNeil Real Estate Fund XIV, Ltd., McNeil
     Real Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX,  L.P.,  McNeil Real
     Estate Fund XXIV, L.P., and McNeil Real Estate Fund XXV, L.P. v. High River
     Limited Partnership,  Riverdale Investors Corp., Carl C. Icahn, and Unicorn
     Associates  Corporation  - United  States  District  Court for the  Central
     District of California, Case No. 96-5680SVW.

     On August 12, 1996,  High River Limited  Partnership (as defined in Section
     6, "High River"), a partnership  controlled by Carl C. Icahn, sent a letter
     to the partnerships  referenced above demanding lists of the names, current
     residences or business  addresses and certain other information  concerning
     the  unitholders  of  such   partnerships.   On  August  19,  1996,   these
     partnerships  commenced the above action  seeking,  among other things,  to
     declare that such  partnerships are not required to provide High River with
     a current list of unitholders on the grounds that the defendants  commenced
     a tender  offer in  violation  of the  federal  securities  laws by  filing
     certain Schedule 13D Amendments on August 5, 1996.

     On October 16, 1996, the presiding judge denied the partnerships'  requests
     for a permanent and  preliminary  injunction to enjoin High River's  tender
     offers and  granted the  defendants'  request  for an order  directing  the
     partnerships  to turn  over  current  lists of  unitholders  to High  River
     forthwith.  On October 24, 1996, the partnerships  delivered the unitholder
     lists to High River.  The judge's  decision  resolved all the issues in the
     action.

<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.
                                  SCHEDULE III
              REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
                                December 31, 1996

<TABLE>
<CAPTION>
                                                                                  Cumulative           Costs
                                                       Initial Cost                Write-down       Capitalized
                          Related                             Buildings and     and Permanent       Subsequent
Description               Encumbrances         Land           Improvements        Impairment (b)    To Acquisition
-----------               -------------        ----           --------------    ----------------    --------------
<S>                        <C>               <C>               <C>               <C>               <C>          
APARTMENTS:

Pine Hills
   Livingston, TX          $            -    $      605,145    $    3,917,607    $    (692,000)    $     510,057

Sleepy Hollow
   Cleveland, TX                        -           363,051         4,010,076                -           287,418

RETAIL CENTERS:

Riverbay Plaza
   Riverview, FL                        -           294,546         4,736,097                -           934,601

Springwood Plaza
   Dellwood, MO                         -           784,767         2,574,183                -         1,005,760

Towne Center
   Derby, KS                            -           361,605         2,359,900         (500,000)          305,675
                            -------------     -------------     -------------     ------------      ------------
                           $            -    $    2,409,114    $   17,597,863    $  (1,192,000)    $   3,043,510
                            =============     =============     =============     ============      ============

ASSETS HELD FOR SALE:

Island Plaza
   Fort Myers, FL          $            -

Southpointe Plaza
   Sacramento, CA               5,421,763
                            -------------
                           $    5,421,763
                            =============
</TABLE>



(b)  The carrying  values of Pine Hills  Apartments  and Towne  Center  Shopping
     Center were reduced by $692,000 and $500,000,  respectively,  in 1991.  The
     carrying value of Island Plaza Shopping Center was reduced by $1,500,085 in
     1995.

(c)  Assets held for sale are stated at lower of cost or fair value less cost to
     sell.  Historical  cost net of  accumulated  depreciation  and  write-downs
     becomes the new cost basis when the asset is classified as "Held for Sale."
     Depreciation  ceases at the time the  assets  are  placed on the market for
     sale.


                     See accompanying notes to Schedule III.
<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.
                                  SCHEDULE III
              REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
                                December 31, 1996

<TABLE>
<CAPTION>
                                            Gross Amount at
                                     Which Carried at Close of Period                 Accumulated
                                                 Buildings and                        Depreciation
Description                      Land            Improvements          Total (a)      and Amortization
-----------                      ----            --------------        ---------      ----------------
<S>                           <C>                <C>              <C>                 <C>            
APARTMENTS:

Pine Hills
   Livingston, TX             $      605,145     $    3,735,664   $      4,340,809    $   (1,756,654)

Sleepy Hollow
   Cleveland, TX                     363,051          4,297,494          4,660,545        (1,952,845)

RETAIL CENTERS:

Riverbay Plaza
   Riverview, FL                     294,546          5,670,698          5,965,244        (2,495,310)

Springwood Plaza
   Dellwood, MO                      784,767          3,579,942          4,364,709        (1,605,337)

Towne Center
   Derby, KS                         361,605          2,165,575          2,527,180        (1,077,026)
                               -------------      -------------    ---------------     -------------

                              $    2,409,114     $   19,449,373   $     21,858,487    $   (8,887,172)
                               =============      =============    ===============     =============

ASSETS HELD FOR SALE (c):

Island Plaza
   Fort Myers, FL                                                 $      2,016,188

Southpointe Plaza
   Sacramento, CA                                                        6,392,000
                                                                   ---------------
                                                                  $      8,408,188
                                                                   ===============
</TABLE>


(a)  For Federal income tax purposes,  the properties are depreciated over lives
     ranging from 7-39 years using ACRS or MACRS methods.  The aggregate cost of
     real estate investments for Federal income tax purposes was $38,562,094 and
     accumulated depreciation was $16,205,687 at December 31, 1996.

(c)  Assets held for sale are stated at lower of cost or fair value less cost to
     sell.  Historical  cost net of  accumulated  depreciation  and  write-downs
     becomes the new cost basis when the asset is classified as "Held for Sale."
     Depreciation  ceases at the time the  assets  are  placed on the market for
     sale.



                     See accompanying notes to Schedule III.

<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.
                                  SCHEDULE III
              REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
                                December 31, 1996


<TABLE>
<CAPTION>

                                 Date of                    Date                Depreciable
Description                   Construction                Acquired              lives (years)
-----------                   ------------                --------              -------------
<S>                             <C>                         <C>                     <C> 
APARTMENTS:

Pine Hills
   Livingston, TX               1984                        10/85                   5-25

Sleepy Hollow
   Cleveland, TX                1983                        08/85                   5-25

RETAIL CENTERS:

Riverbay Plaza
   Riverview, FL                1983                        04/85                   5-25

Springwood Plaza
   Dellwood, MO                 1974                        09/85                   5-25

Towne Center
   Derby, KS                    1976                        07/85                   5-25

ASSETS HELD FOR SALE (c):

Island Plaza
   Fort Myers, FL               1985                        04/85                   

Southpointe Plaza
   Sacramento, CA               1982-84                     11/85                   


</TABLE>



                     See accompanying notes to Schedule III.
<PAGE>
                       McNEIL REAL ESTATE FUND XXIV, L.P.

                              Notes to Schedule III
      Real Estate Investments and Accumulated Depreciation and Amortization


A  summary  of  activity  for the  Partnership's  real  estate  investments  and
accumulated depreciation and amortization is as follows:

<TABLE>
<CAPTION>
                                                            For the Years Ended December 31,
                                                   ----------------------------------------------------
                                                       1996               1995               1994
                                                   --------------    ---------------    ---------------
<S>                                                <C>               <C>                <C>            
Real estate investments:

Balance at beginning of year...............        $   35,244,771    $    36,312,702    $    35,606,449

Improvements...............................               458,752            432,154            706,253

Reclassification to assets held for sale...           (13,794,699)                 -                  -

Write-off of damaged basis.................               (50,337)                 -                  -

Write-down for impairment
   of real estate..........................                     -         (1,500,085)                 -
                                                    -------------      -------------     --------------

Balance at end of year.....................        $   21,858,487     $   35,244,771    $    36,312,702
                                                    =============      =============     ==============


Accumulated depreciation and amortization:

Balance at beginning of year...............        $   12,428,415      $  11,061,009    $     9,770,111

Depreciation...............................             1,191,313          1,367,406          1,290,898

Reclassification to assets held for sale...            (4,712,085)                 -                  -

Write-off of damaged basis.................               (20,471)                 -                  -
                                                    -------------      -------------     --------------

Balance at end of year.....................        $    8,887,172     $   12,428,415    $    11,061,009
                                                    =============      =============     ==============


Assets Held for Sale:

Balance of beginning of year...............        $            -     $            -    $             -

Reclassification to assets held for sale...             9,082,614                  -                  -

Improvements...............................                26,058                  -                  -

Write-down for impairment
   of real estate..........................              (700,000)                 -                  -
                                                    -------------      -------------     --------------

Balance at end of year.....................        $    8,408,672     $            -    $             -
                                                    =============      =============     ==============

</TABLE>

<PAGE>
                                    PART III

ITEM 9.       CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
-------       ---------------------------------------------------------------
              FINANCIAL DISCLOSURES
              ---------------------

None.


ITEM 10.      DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
--------      --------------------------------------------------

Neither the  Partnership  nor the General Partner has any directors or executive
officers.  The names and ages of, as well as the positions held by, the officers
and  directors of McNeil  Investors,  Inc.,  the general  partner of the General
Partner, are as follows:

                                       Other Principal Occupations and Other
Name and Position             Age      Directorships During the Past 5 Years
-----------------             ---      -------------------------------------

Robert A. McNeil,              76       Mr.  McNeil  is also  Chairman  of   the
Chairman of the                         Board and Director of McNeil Real Estate
Board and Director                      Management,  Inc. ("McREMI") which is an
                                        affiliate of the General Partner. He has
                                        held the foregoing  positions  since the
                                        formation  of such  entity in 1990.  Mr.
                                        McNeil  received  his B.A.  degree  from
                                        Stanford  University  in  1942  and  his
                                        L.L.B.  degree from  Stanford Law School
                                        in 1948. He is a member of the State Bar
                                        of  California  and has been involved in
                                        real  estate  financing  since  the late
                                        1940's and in real estate  acquisitions,
                                        syndications  and   dispositions   since
                                        1960. From 1986 until active  operations
                                        of  McREMI  and  McNeil  Partners,  L.P.
                                        began in February 1991, Mr. McNeil was a
                                        private investor. Mr. McNeil is a member
                                        of the International  Board of Directors
                                        of the Salk  Institute,  which  promotes
                                        research in improvements in health care.

Carole J. McNeil               53       Mrs.  McNeil    is  Co-Chairman,    with
Co-Chairman of the                      husband  Robert  A.  McNeil,  of  McNeil
Board                                   Investors,  Inc. Mrs.  McNeil has twenty
                                        years of real  estate  experience,  most
                                        recently as a private investor from 1986
                                        to 1993.  In 1982,  she founded  Ivory &
                                        Associates,  a  commercial  real  estate
                                        brokerage  firm  in San  Francisco,  CA.
                                        Prior to that, she was a commercial real
                                        estate   associate   with  the   Madison
                                        Company  and,   earlier,   a  commercial
                                        sales/associate  and analyst with Marcus
                                        and Millichap in San Francisco. In 1978,
                                        Mrs. McNeil  established Escrow Training
                                        Centers,  California's  first accredited
                                        commercial  training  program  for title
                                        company escrow  officers and real estate
                                        agents   needing   college   credits  to
                                        qualify  for  brokerage  licenses.   She
                                        began  in real  estate  as  Manager  and
                                        Marketing  Director  of Title  Insurance
                                        and  Trust in  Marin  County,  CA.  Mrs.
                                        McNeil serves on the International Board
                                        of Directors of the Salk Institute.

<PAGE>
                                        Other Principal Occupations and Other
Name and Position              Age      Directorships During the Past 5 Years
-----------------              ---      -------------------------------------

Ron K. Taylor                  39       Mr.  Taylor is the  President  and Chief
President and Chief                     Executive  Officer of McNeil Real Estate
Executive Officer                       Management  which is an affiliate of the
                                        General Partner.  Mr. Taylor has been in
                                        this capacity  since the  resignation of
                                        Donald K. Reed on March 4,  1997.  Prior
                                        to       assuming       his      current
                                        responsibilities, Mr. Taylor served as a
                                        Senior  Vice  President  of McREMI.  Mr.
                                        Taylor has been in this  capacity  since
                                        McREMI  commenced  operations  in  1991.
                                        Prior  to  joining  McREMI,  Mr.  Taylor
                                        served as an  Executive  Vice  President
                                        for  a   national   syndication/property
                                        management  firm. In this capacity,  Mr.
                                        Taylor  had the  responsibility  for the
                                        management  and leasing of a  21,000,000
                                        square  foot   portfolio  of  commercial
                                        properties. Mr. Taylor has been actively
                                        involved  in the  real  estate  industry
                                        since 1983.

Each director  shall serve until his successor  shall have been duly elected and
qualified.

ITEM 11.     EXECUTIVE COMPENSATION
--------     ----------------------

No direct  compensation  was paid or payable by the  Partnership to directors or
officers  (since it does not have any  directors or officers) for the year ended
December  31,  1996,  nor was any  direct  compensation  paid or  payable by the
Partnership  to  directors  or officers  of the  general  partner of the General
Partner for the year ended  December 31, 1996. The  Partnership  has no plans to
pay any such remuneration to any directors or officers of the general partner of
the General Partner in the future.

See Item 13 - Certain  Relationships  and  Related  Transactions  for amounts of
compensation and  reimbursements  paid by the Partnership to the General Partner
and its affiliates.

ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------     --------------------------------------------------------------

(A) Security ownership of certain beneficial owners.

      No individual or group,  as defined by Section  13(d)(3) of the Securities
      Exchange Act of 1934, was known by the  Partnership to own more than 5% of
      the  Units,  other than High River  Limited  Partnership  which owns 3,545
      Units at January 31, 1997 (approximately  8.86% of the outstanding Units).
      The  business  address  for High River  Limited  Partnership  is 100 South
      Bedford Road, Mount Kisco, New York 10549.



<PAGE>

(B) Security ownership of management.

       Neither the General  Partner nor any of the  officers or directors of its
       general partner own any limited partnership units.

(C)    Change in control.

       None.

ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------     ----------------------------------------------

The amendments to the Partnership compensation structure included in the Amended
Partnership  Agreement  provide for an asset management fee to replace all other
forms of general partner  compensation  other than property  management fees and
reimbursements  of certain  costs.  Through 1999,  the asset  management  fee is
calculated as 1% of the Partnership's tangible asset value. Tangible asset value
is  determined  by using the greater of (i) an amount  calculated  by applying a
capitalization  rate of 9 percent to the annualized net operating income of each
property  or  (ii) a  value  of  $10,000  per  apartment  unit  for  residential
properties and $50 per gross square foot for commercial  properties to arrive at
the property  tangible  asset value.  The property  tangible asset value is then
added to the book value of all other assets excluding  intangible items. The fee
percentage  decreases  subsequent to 1999. For the year ended December 31, 1996,
the Partnership paid or accrued $315,497 of such asset management fees.

The  Partnership  pays property  management fees equal to 5% of the gross rental
receipts of residential  properties and 6% for commercial  properties to McREMI,
an affiliate of the General Partner, for providing property management services.
Additionally,  the  Partnership  reimburses  McREMI  for  its  costs,  including
overhead,  of  administering  the  Partnership's  affairs.  For the  year  ended
December 31, 1996,  the  Partnership  paid or accrued  $459,658 of such property
management fees and reimbursements. See Item 1 - Business, Item 7 - Management's
Discussion  and Analysis of Financial  Condition and Results of  Operations  and
Item 8 - Note 2 - "Transactions With Affiliates."

In 1996, the Partnership repaid $642,581 of advances from affiliates.


<PAGE>
ITEM 14.     EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K
--------     -----------------------------------------------------------------

See accompanying Index to Financial Statements at Item 8.

(A)     Exhibits


        Exhibit
        Number                     Description
        -------                    -----------
        4.                         Amended and   Restated  Limited   Partnership
                                   Agreement  of McNeil  Real  Estate Fund XXIV,
                                   L.P.  dated March 30, 1992  (incorporated  by
                                   reference  to  the  Current   Report  of  the
                                   registrant  on Form 8-K dated March 30, 1992,
                                   as filed on April 10, 1992).

        4.1                        Amendment  No. 1 to the  Amended and Restated
                                   Limited Partnership  Agreement of McNeil Real
                                   Estate  Fund  XXIV,   L.P.  dated  June  1995
                                   (incorporated  by reference to the  Quarterly
                                   Report of the  registrant  on Form 10-Q dated
                                   June 30, 1995, as filed on August 14, 1995).

        10.1                       Revolving  Credit  Agreement  dated August 6,
                                   1991,  between  McNeil  Partners,   L.P.  and
                                   various selected partnerships,  including the
                                   registrant  (incorporated by reference to the
                                   Annual Report of the  registrant on Form 10-K
                                   dated  December 31,  1993,  as filed on March
                                   30, 1994).

        10.2                       Portfolio  Services  Agreement dated February
                                   14, 1991,  between Southmark Equity Partners,
                                   Ltd. and McNeil Real Estate Management,  Inc.
                                   (1)

        10.3                       Promissory Note dated March 23, 1987, between
                                   Southmark  Equity  Partners,  Ltd.  and Great
                                   Western Savings relating to Southpointe Plaza
                                   Shopping Center. (1)

        10.4                       Property  Management  Agreement   dated March
                                   30,  1992,  between  McNeil  Real Estate Fund
                                   XXIV, L.P. and McNeil Real Estate Management,
                                   Inc. (2)

        10.5                       Amendment of  Property  Management  Agreement
                                   dated  March 5, 1993,  by McNeil  Real Estate
                                   Fund  XXIV,   L.P.  and  McNeil  Real  Estate
                                   Management, Inc. (2)


<PAGE>

        11.                        Statement regarding computation of Net Income
                                   per  Limited  Partnership  Unit (see Item 8 -
                                   "Organization   and  Summary  of  Significant
                                   Accounting Policies").


              (1)                  Incorporated  by reference  to the  Quarterly
                                   Report of the registrant on Form 10-Q for the
                                   period ended March 31, 1991,  as filed on May
                                   14, 1991.

              (2)                  Incorporated  by reference to   the    Annual
                                   Report of the registrant on form 10-K for the
                                   period ended  December 31, 1992,  as filed on
                                   March 30, 1993.


(B)    Reports on Form 8-K:  There were no reports on Form 8-K filed  during the
       quarter ended December 31, 1996.


<PAGE>



                       McNEIL REAL ESTATE FUND XXIV, L.P.
                              A Limited Partnership

                                 SIGNATURE PAGE


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.


                             McNEIL REAL ESTATE FUND XXIV, L.P.

                             By:  McNeil Partners, L.P., General Partner

                                  By: McNeil Investors, Inc., General Partner



March 28, 1997                     By:   /s/  Robert A. McNeil
--------------                          ----------------------------------------
Date                                    Robert A. McNeil
                                        Chairman of the Board and Director
                                        Principal Executive Officer


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.



March 28, 1997                     By:  /s/  Ron K. Taylor
--------------                         -----------------------------------------
Date                                   Ron K. Taylor
                                       President and Director of McNeil 
                                       Investors, Inc.
                                       (Principal Financial Officer)



March 28, 1997                      By:  /s/  Carol A. Fahs
--------------                          ----------------------------------------
Date                                    Carol A. Fahs
                                        Vice President of McNeil Investors, Inc.
                                        (Principal Accounting Officer)