UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                      Washington, DC 20549
                           FORM 10-K
     [X]  Annual Report Pursuant to Section 13 or 15(d) of the
                  Securities Exchange Act of 1934
            For the Fiscal Year Ended December 31, 1997
   [  ]  Transition Report Pursuant to Section 13 or 15(a) of the
                  Securities Exchange Act of 1934
                   Commission File Number 0-15756

                                  LIF
        (Exact name of registrants as specified in its charter)

                       California 94-2969720
             (State or other jurisdiction of (I.R.S. Employer
           incorporation or organization) Identification Number)

                 P. O. Box 130, Carbondale, Colorado 81623
                  (Address of principal executive offices)

                          (970) 963-8007
          (Partnership's telephone number, including area code)
      Securities registered pursuant to Section 12(b) of the Act:

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

                Units of Limited Partnership Interest
                         (Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.

                     Yes [ X ]     No [   ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (229.405 of this chapter) 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 [  ]

State the aggregate market value of the voting stock held by non-affiliates
of the registrant.  Inapplicable.

DOCUMENTS INCORPORATED BY REFERENCE:  None

<PAGE>

                                     LIF
                                  FORM 10-K
                     FOR THE YEAR ENDED DECEMBER 31, 1997

                               TABLE OF CONTENTS
Item No.      Name of Item

Part I
 Item 1.      Business
 Item 2.      Properties
 Item 3.      Legal Proceedings
 Item 4.      Submission of Matters to a Vote of Security Holders

Part II
 Item 5.      Market for Partnership's Common Equity and Related
              Shareholders Matters
 Item 6.      Selected Financial Data
 Item 7.      Management's Discussion and Analysis of Financial
              Condition and Results of Operations
 Item 8.      Financial Statements and Supplementary Data
 Item 9.      Change in and Disagreements with Accountants on
              Accounting and Financial Disclosure

Part III
 Item 10.      Directors and Executive Officers of the Registrant
 Item 11.      Executive Compensation
 Item 12.      Security Ownership of Certain Beneficial Owners
               and Management
 Item 13.      Certain Relationships and Related Transactions

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

Signatures

Index to Consolidated Financial Statements and Supplemental
Consolidated Financial Statement Schedule

<PAGE>

PART I

ITEM 1. BUSINESS

LIF (the "Partnership") is a limited partnership which was organized under
the California Revised Limited Partnership Act on June 29, 1984.  The
Partnership was organized to acquire real properties, including
commercial, residential and agricultural properties, located primarily
within the western portion of the United States, and to make short-term
loans and capital contributions to other limited partnerships formed to
acquire or develop and operate one or more income-producing real
properties.  The Partnership was formed with the following principal
investment objectives: (i) to provide the maximum possible cash
distributions from operations, a substantial portion of which may not be
taxable to the holders of units of limited partnership interest in the
Partnership (the "Holders"); (ii) to provide for capital growth through
appreciation in values; and (iii) to protect the Partnership's capital.  The
General Partner of LIF is Partners '85 (the "General Partner") a partnership
whose General Partner is Landsing Equities Corporation.

The Partnership's business consists of a single segment -- acquisition and
operation of one or more income-producing real properties and making
short-term loans and capital contributions to operating entities formed to
acquire or develop real properties.  For a schedule of the Partnership's
income and losses and assets, see Item 6, Selected Financial Data.  The
Partnership will not be engaged in the production of goods or the rendering
of services.  For a more specific discussion of the Partnership's operations
and financial condition, see Item 7, Management's Discussion and
Analysis of Financial Condition and Results of Operations.

The Partnership currently has an investment in Landsing Private Fund-21
("P-21") which owns one multi-family rental property, Alpine Center
Partners ("ACP") which owns 1.96% of a commercial rental property. The
partnership owns two retail rental properties, which in prior years were owned
by Cattle Creek Development Partners ("CCDP"). CCDP was liquidated into LIF in
1997. For financial reporting purposes the Partnership's investments
are presented on a consolidated basis.

Results of the Partnership's operations depend primarily upon the
successful operation of it's investment.  The yields (return on capital)
available on equity ownership of investments in income-producing and
other types of real estate investments depend to a large extent upon the
ability to lease or rent the property, the geographic location of the
property, competition and other factors, none of which can be predicted
with any certainty.

The Partnership has not engaged in research activities relating to the
development or improvement of products or services.  The Partnership has
not made, nor does it anticipate making, during the succeeding fiscal year,
any capital expenditures for environmental control facilities, nor does it
expect any material effects upon capital expenditures, earnings or
competitive position resulting from compliance with present federal, state
or local environmental control provisions.  The Partnership has no
employees.  All of the Partnership's operations are located in the United
States.

<PAGE>
<TABLE>

ITEM 2. PROPERTIES

A description of the income-producing properties which the Partnership
owned at December 31, 1997 is as follows:
<CAPTION>

                                              Financial
                                              Occupancy                 Average
                                   Net        For the      Physical    Effective
                                   Rentable   Year Ended   Occupancy    Rental
Name & Location       Type         Sq. Ft.    12/31/97     At 12/31/97   Rate
                                              <F1>         <F2>          <F3>
<S>                   <C>          <C>        <C>          <C>           <C>
Whistler Point Apt    Residential  140,230     93%          94%          $ 9
Boise, Idaho

Valley View
Business Center
Glenwood Springs, CO  Retail        20,750     81%          86%          $ 8

701 Cooper
Glenwood Springs, CO  Commercial     2,937     100%         100%         $10

Alpine Center Building <F4>
Carbondale, CO        Commercial    12,349     65%          79%          $ 8

</TABLE>
[FN]
<F1>
(1)  Expressed as a percentage, it compares the actual dollar amount of
rent received with the dollar amount of rent which would be received
if the property were fully leased.

<F2>
(2)  Physical occupancy denotes the percentage of net rentable square
footage leased as of a certain date.

<F3>
(3)  Represents the average effective rental rates, per square foot, for the
year ended December 31, 1997.

<F4>
(4)  The Partnership (through ACP) owns 1.96% of the Alpine Center Building.

Each of the Partnership's properties are subject to encumbrances. Reference is
made to Note 5 in the financial statements filed as part of this annual report
for information regarding such encumbrances.


ITEM 3. LEGAL PROCEEDINGS

Continued from 1996, the Partnership, through CCDP, has had suit filed
Against it by two tenants alleging loss of business during the re-development
of CCDP's property. CCDP's defense is being paid by its insurance carrier. The
Partnership's insurance carrier has retained a reservation of rights against
the Partnership. An estimate of potential loss is up to $96,000. See Note 8 to
the financial Statements.

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

No matter has been submitted to a vote of the limited partners (the
"Limited Partners") through the solicitation of proxies or otherwise, during
the fourth quarter of 1997.

<PAGE>
<TABLE>
PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
AND RELATED SHAREHOLDERS MATTERS

There is no established public trading market for the units of Limited
Partnership interest of the Partnership and there are substantial restrictions
on the transferability of such Units imposed by federal and state securities
laws and by the Limited Partnership Agreement.

The approximate number of record holders of Units of the Partnership as
of January 1, 1998, is 927.

The Limited Partners of the Partnership are entitled to certain distributions
under the Amended and Restated Certificate and Agreement of Limited
Partnership of the Partnership.  No cash distributions were made during the
Year ended December 31, 1997. A cash distribution of $15 per unit, to unit
holders of record on February 28, 1998, will be paid in March 1998.

ITEM 6. SELECTED FINANCIAL DATA
       (In thousands, except Partnership units)
<CAPTION>

                                      . . . . . . .DECEMBER 31 . . . . . . .
                                       1997    1996    1995    1994     1993
<S>                                <C>       <C>     <C>     <C>      <C>
Total Revenues                     $ 1,781   $1,517  $1,567  $1,361   $1,216
Net Income (Loss)                     (127)    (136)    (52)     27       58
Net Income (Loss) Per Unit<F1>         (10)     (11)     (4)      2        5
Total Assets                        10,293    9,864   9,076   8,153    7,318
Long-term Obligations - Net          7,679    7,960   6,897   5,591    4,406
Cash Distributions-Limited Partners      0      192     385     385        0
Paid Per Unit<F1>                        0       15      30      30        0

<FN>
<F1>
Based on a weighted average of 12,820 limited partnership units
outstanding in 1997, 1996, 1995, 1994 and 1993.

</TABLE>
<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
        AND RESULTS OF OPERATIONS

INTRODUCTION

The Partnership was organized to acquire real properties, including
commercial, residential and agricultural properties, located primarily
within the western portion of the United States, and to make short-term
loans and capital contributions to other limited partnerships formed to
acquire or develop and operate one or more income-producing real properties.

The Partnership currently has a 99% investment in Landsing Private Fund-21
("P-21") which owns one multi-family rental property, and a 95% investment in
Alpine Center Partners ("ACP") which owns 1.96% of a commercial building under
construction. The Partnership also owns two retail rental properties, which
were formerly owned by CCDP. For financial reporting purposes the
Partnership's investments are presented on a consolidated basis.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31, 1997, the Partnership's consolidated cash balance
totaled $570,000.  Cash not required for current operations is placed in
federally insured financial instruments, certificates of deposit, and money
market funds which can be liquidated as needed.  It is the Partnership's
intention to maintain adequate cash reserves for its operations.

During 1997, the Partnership experienced a net increase in cash and cash
equivalents of $182,000 As of December 31, 1997, cash and cash equivalents
totaled $570,000, versus $388,000 at December 31, 1996 for a net increase of
$182,000.

The Short-Term Loan made to Cattle Creek Development Partners, a
Colorado limited partnership ("CCDP"), was partially repaid in December
1996.  The remaining loan balance, including accrued and unpaid interest,
as of December 31, 1996 was $550,000.  The loan was past due and was thus in
default as of December 31, 1997. In 1997, per the terms of the loan agreement
between LIF and CCDP, the properties securing the loan, Valley View Business
Park and 701 Cooper, because 100% owned by LIF.  These intercompany
transactions were eliminated in consolidation.

The balance of the short-term loan, and the related interest income and
expense, between LIF and CCDP was eliminated in the consolidation of the
Partnership's financial statements.

On June 3, 1996, the Partnership made a Short-Term Loan in the principal
amount of $585,000 to Alpine Center Partners, a Colorado limited
partnership ("ACP").  ACP was organized to acquire one commercial
property located in Carbondale, Colorado.  The Partnership also made a
capital contribution to ACP in the amount of $10,000 and became a Co-General
Partner of ACP.

On September 30, 1997, the Partnership's investment in ACP sold 40.20%
of the Alpine Center Building to Gary K. Barr (GKB).  GKB is the president of
the General Partner of LIF.  This sale resulted in cash to ACP of $370,000.
On September 30, 1997, ACP also sold 45.90% of the Alpine Center Building to
Open World Investors (OWI), of which Gary K. Barr is a General Partner.  This
sale generated cash to ACP of $420,000.  ACP deferred a gain on sale from
these two transactions of $69,000.  ACP provided seller financing to GKB and
OWI in the amounts of $864,300 and $986,850 respectively.  The partnership's
investment in ACP owned 1.96% of the Alpine Center Building on December 31,
1997.  ACP reduced its short-term note payable to LIF by $358,000.  The balance
of the note payable at December 31, 1997 was $227,000.  ACP's share of the
note payable was eliminated in the consolidation of the Partnership's financial
statements.

For financial reporting purposes, results of operations for P21, CCDP and ACP
have been shown on a consolidated basis.

<PAGE>

RESULTS OF OPERATIONS

Rental revenues were $1,729,000 in 1997, for an increase of $246,000 over 1996.
Rental revenues were $1,483,000 in 1996, a decrease of $59,000 or approximately
4% from 1995.  The decline in rental revenues in 1996 versus 1995 was the
result of the sale of four properties in 1996, which properties were operational
for the entire year in 1995.  The improvement in revenues in 1997 as compared
to 1996 was the result of the lease-up of the Alpine Center, improved occupancy
and rates at Whistler Point Apartments and an increase in rent payments at 701
Cooper.

Operating expenses were $666,000 in 1997, a increase of $71,000 or 12%
from 1996.  Operating expenses were $595,000 in 1996, a decrease of
$48,000 or 7% from 1995.  The increase of operating expenses in 1997 versus
1996 was the result of having more properties operating for the entire year
in 1997 as compared to 1996.  The decrease in operating expenses in 1996
was the result of property sales during the year.  Specifically, maintenance
and repairs decreased 14%, and general and administrative costs decreased
12%.  Other operating costs remained steady with 1995 levels.

Net operating income of properties (rental revenue less operating expenses)
was $1,063,000 in 1997, an increase of $175,000 or 19% from 1996.  Management
believes net operating income is the best indication of the Properties'
performance.

Interest income increased from $34,000 in 1996 to $52,000 in 1997.  The
increase was due to the increase in the Partnership's short-term investments
and cash equivalents, and better interest rates on these investments.

Interest expense increased 22% in 1997 from 1996 levels due to average
larger outstanding loan balances in 1997.  Interest expense increased in
1996 from 1995, due to the acquisition of the Alpine Center in 1996.

Interest income and interest expense on loans by and between LIF and its
investments, ACP and CCDP, was eliminated in the consolidation of the
company's financial statements.

Entity level general and administrative expenses, exclusive of that at the
property level, decreased $24,000 in 1997 compared to 1996.  Portfolio
management fees remained unchanged.

The net loss for 1997 was $127,000, an improvement of $9,000 from 1996's loss.
The net loss for the Partnership was $136,000 in 1996, an increase of $84,000
from a net loss of $52,000 in 1995.  The decrease in net loss in 1997 is a
result of improved property operations. Due to the lease up of the Alpine
Center and the improved operations of the Valley View and 701 Cooper
properties, the net losses for the properties are expected to continue, but
at reduced levels in the future.

<PAGE>

PROPERTY OPERATIONS

Residential Property - The remaining residential property, Whistler Point
Apartments in Boise, Idaho, continues to operate at a profit in spite of the
very competitive market in which it is located.  In 1997, the Partnership
continued to make capital improvements to the property to allow it to compete
effectively with new competition.  The Partnership is continuing this program
in 1998 with an expected cost of $150,000.  Specific capital expenditures are
for new washers and dryers in all units, new microwaves, new carpet and vinyl
flooring, carports, and exterior deck improvements.  The Partnership
anticipates that when this improvement program is completed, the property will
be placed on the market for sale in 1998.

Commercial Property - The 701 Cooper Building remained 100% occupied
during 1997.  The Valley View Business Center had stable occupancy during
1997.  However, at the end of the year, the sole tenant of 701 Cooper and
CCDP agreed to cancel the remaining term of the lease for a payment of
$61,000.  A short-term tenant has occupied the building in January 1998.
Both properties, Valley View Business Center and 701 Cooper are currently
listed for sale on the market.

Commercial Property - ACP has a l.96% investment in the Alpine Center
Building.  The building was remodeled in 1996 and available for occupancy
in 1997.  An additional phase of construction is scheduled for 1998.

OCCUPANCY

Occupancy at all of the Partnership's properties remain high in 1997.  As
of December 31, 1997, occupancy at Whistler Point Apartments was 94%.
This occupancy level is expected to be achieved through 1998.  Occupancy at
properties owned by CCDP averaged 90% as of December 31, 1997.  It is
expected that all Partnership properties will maintain stable to improved
occupancy during 1998.

DISTRIBUTIONS

No cash distributions were paid in 1997.  The General Partner has declared a
cash distribution of $15 per unit to unit holders of record on February 28,
1998, to be paid in March 1998.

INFLATION

The effect of inflation on the Partnership's operations have been no greater
than the effect on the economy as a whole.  Because of competitive
conditions, market rate rents may increase or decrease disproportionately
with inflation while property operating costs continue to follow
inflationary trends.  Inflationary conditions are not expected to have a
major impact on the Partnership during 1998.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by this Item is contained at page F-1 following in
this report.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
         AND FINANCIAL DISCLOSURE
None.

<PAGE>

PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The General Partner of the Partnership is Partners '85, which has sole
responsibility for all aspects of the Partnership's operations.  Partners '85
is a limited partnership, whose General Partner is Landsing Equities
Corporation, a California corporation.

Landsing Equities Corporation was incorporated in California in 1983.  It
is a wholly-owned subsidiary of The Landsing Corporation which has
acted as a sponsor of real estate investment programs, providing property
acquisition and management services.

Gary K. Barr is the Director and President of Landsing Equities
Corporation.  His principal occupation during the last five years or more,
and certain other affiliations are set forth below:

Gary K. Barr.  Mr. Barr serves as Chairman and Chief Executive Officer
of Pacific Coast Capital and served as President and Director of
Landsing Pacific Fund from its inception in November, 1988 to July, 1992.
Mr. Barr received a Bachelor of Science degree in Mechanical Engineering
from Oklahoma State University in 1967 and a Master of Business
Administration degree from the Stanford University Graduate School of
Business in 1972.  Mr. Barr serves on the Board of Governors of the
National Association of Real Estate Investment Trusts and on its Editorial
Board.  Mr. Barr has served as President of the California Chapter of the
Real Estate Securities and Syndication Institute of the National Association
of Realtors ("RESSI"), which has awarded him the designation of
Specialist in Real Estate Securities.  Since 1983, he has served on the
Board of Directors of Silicon Valley Bancshares.  In 1989 he authored the
book J.K. Lasser's "Real Estate Investment Guide" published by Prentice
Hall.

ITEM 11. EXECUTIVE COMPENSATION

The Director and President of Landsing Equities Corporation does not
receive compensation from the Partnership.  However, the General Partner,
Partners '85, has contracted with Pacific Coast Capital, an affiliate, for
the provision of certain asset management and administrative services.  During
1997, Pacific Coast Capital received management fees of $103,000, which
were determined based on expenses incurred in order to operate the
Partnership. In addition, Pacific Coast Capital was paid $36,000 for
property management services.  These property management fees were
based on 2% of the monthly property revenues received from Whistler
Point Apartments.  See Item 13, Certain Relationships and Related
Transactions for further information.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

No persons or groups are known by the Partnership to hold more than 5%
of the Units of limited partnership of the Partnership.  The General Partner
is not a direct or beneficial owner of Units of limited partnership.  The
General Partner knows of no arrangement, including any pledge by any
person of securities of the Partnership, the operation of which may at a
subsequent date result in a change in control of the Partnership.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Partnership has agreements with The Landsing Corporation and one of
its affiliates, Pacific Coast Capital, pursuant to which the Partnership has
paid various fees and compensation to these companies.

The Partnership has entered into a property management agreement with
Pacific Coast Capital for the management of the Partnership's property.
During 1997, the Partnership paid Pacific Coast Capital $36,000 for
property management and leasing services.

The Partnership has retained Pacific Coast Capital to serve as advisor and
to manage the day-to-day operations of the Partnership.  Pacific Coast
Capital is to perform these services based on reimbursement of costs
incurred but in no case are these to exceed those which the Partnership
would have to pay independent parties for comparable services.  During
1997, the Partnership paid Pacific Coast Capital expense reimbursements
of $103,000.

For information concerning the agreements between the Partnership and
the affiliates of The Landsing Corporation, see Note 2 of Notes to
Financial Statements filed as part of this Annual Report.

<PAGE>

PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

 (a)   1. Financial Statements
          See the Index on page F-1.

       2. Financial Statement Schedules
          See the Index on page F-1.

       3. Exhibits
          See the Exhibit Index which immediately precedes the
          Exhibits filed with this Report.

 (b)   No reports were filed by the Partnership on Form 8-K during
       the fourth quarter ended December 31, 1997.

<PAGE>

                               SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Partnership has duly caused this Report to be
signed on its behalf by the undersigned, thereunto duly authorized.

                               LIF

                               By: Partners '85

                               By: Landsing Equities Corporation,
                                   General Partner

March 28, 1998                     By:  /s/ Gary K. Barr
                                       GARY K. BARR, President and Director

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
Partnership and in the capacities and on the dates indicated.


March 28, 1998                         /s/ Gary K. Barr
                                      GARY K. BARR, President and Director
                                      Landsing Equities Corporation
                                      (Principal Executive Officer)

Supplemental Information to be Furnished With Reports Filed Pursuant to
Section 15(d) of the Act by Registrants Which Have Not Registered
Securities Pursuant to Section 12 of the Act.

No Annual Report or Proxy material has been sent to Partnership's security
holders.  An Annual Report will be furnished to such security holders
subsequent to the filing of Partnership's Annual Report on Form 10-K, and,
when so sent, Partnership shall furnish copies of such material to the
Commission.

<PAGE>

LIF

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTAL
CONSOLIDATED FINANCIAL STATEMENT SCHEDULES INCLUDED IN THE FORM 10-K

Report of Independent Accountants

Financial Statements:

Consolidated Balance Sheets, December 31, 1997 and 1996

Consolidated Statements of Operations for the Years Ended
  December 31, 1997, 1996 and 1995

Consolidated Statements of Changes in Partners' Equity for the Years
  Ended December 31, 1997, 1996 and 1995

Consolidated Statements of Cash Flows for the Years Ended
  December 31, 1997, 1996 and 1995

Notes to Consolidated Financial Statements

Supplemental Consolidated Financial Statement Schedule:

Schedule III - Real Estate and Accumulated Depreciation
  for the Year Ended December 31, 1997

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Partners of LIF:

We have audited the accompanying consolidated financial statements and
consolidated financial statement schedule of LIF and subsidiaries listed in
the index on page F-1 of this Form 10-K as of December 31, 1997 and
1996, and the related consolidated statements of operations, partners'
equity and cash flows for each of the three years in the period ended
December 31, 1997.  These financial statements are the responsibility of
the Partnership's management.  Our responsibility is to express an opinion
on these financial statements and financial statement schedule based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards required 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 consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of LIF and subsidiaries as of December 31, 1997 and 1996, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1997, in conformity with
generally accepted accounting principles.  In addition, in our opinion, the
consolidated financial statement schedule referred to above, when
considered in relation to the basic financial statements taken as a whole,
present fairly, in all material respects, the information required to be
included therein.

DALBY, WENDLAND & CO., P.C.
Glenwood Springs, Colorado
March 9, 1998

<PAGE>
<TABLE>

LIF

CONSOLIDATED BALANCE SHEETS, DECEMBER 31, 1997 AND 1996
(In thousands except for Partnership units)
<CAPTION>
                                                      1997           1996
<S>                                                <C>            <C>
ASSETS

INVESTMENT IN REAL ESTATE:
Rental property                                    $10,327        $11,523
Accumulated depreciation                            (2,607)        (2,282)
Rental property - net                                7,720          9,241

CASH AND CASH EQUIVALENTS (including interest
 bearing deposits of $434 in 1997 and $282 in 1996)    570            388

OTHER ASSETS:
Accounts receivable                                     49              9
Deferred loan costs, net of accumulated
 amortization of $212 in 1997 and $174 in 1996          84            122
Prepaid expenses                                        19             29
Notes receivables                                    1,851              0
Total other assets                                   2,003            160

TOTAL                                              $10,293        $ 9,789

LIABILITIES AND PARTNERS' EQUITY

LIABILITIES:
Notes payable                                      $ 7,679        $ 7,960
Accounts payable                                        21             29
Liability for future improvements                      828              0
Other liabilities                                      217            194
Deferred gain on real estate                            69              0
Total liabilities                                    8,814          8,183

PARTNERS' EQUITY
  Limited Partners                                   1,632          1,759
  General Partners                                    (153)          (153)

TOTAL                                              $10,293        $ 9,789

Equity Units Authorized  - Limited Partners         12,820         12,820
                         - General Partners              0              0

Equity Units Outstanding - Limited Partners         12,820         12,820
                         - General Partners              0              0

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

</TABLE>
<PAGE>
<TABLE>
LIF

CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(In thousands except for Partnership units)
<CAPTION>

                                           1997       1996       1995
<S>                                      <C>        <C>        <C>
REVENUES:
Rental                                   $1,729     $1,483     $1,542
Interest                                     52         34         25
Total revenues                           $1,781      1,517      1,567

EXPENSES:
Interest                                    662        533        482
Operating                                   666        595        643
Depreciation and amortization               386        343        307
General and administrative                  194        218        187
Total expenses                            1,908      1,689      1,619

Gain from sale of real estate                 0         36          0
NET INCOME (LOSS) FROM OPERATIONS        $ (127)    $ (136)     $ (52)

Net income (loss) - Limited Partners     $ (127)    $ (136)     $ (52)
Net income (loss) - General Partners          0          0          0

NET INCOME (LOSS) PER PARTNERSHIP UNIT
    Limited Partners                        (10)       (11)        (4)
    General Partners                          0          0          0

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

</TABLE>
<PAGE>
<TABLE>
LIF

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(In thousands except for Partnership units)
<CAPTION>
                                LIMITED PARTNERS
                                   NUMBER OF              GENERAL   TOTAL
                                  PARTNERSHIP             PARTNER   PARTNERS'
                                     UNITS      AMOUNT    AMOUNT    EQUITY
<S>                                  <C>        <C>       <C>       <C>
BALANCE, JANUARY 1, 1995             12,820     $2,524    $(122)    $2,402
Net loss - 1995                                    (52)       0        (52)
Distribution - 1995                               (385)     (41)      (426)
Contributions - 1995                                 0        5          5

BALANCE, DECEMBER 31, 1995           12,820      2,087     (158)     1,929
Net loss - 1996                                   (136)       0       (136)
Distribution - 1996                               (192)     (22)      (214)
Contributions - 1996                                 0       27         27

BALANCE, DECEMBER 31, 1996           12,820      1,759     (153)     1,606
Net loss - 1997                                   (127)       0       (127)

BALANCE, DECEMBER 31, 1997           12,820     $1,632    $(153)    $1,479

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

</TABLE>
<PAGE>
<TABLE>

LIF

CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(In thousands except for Partnership units)
<CAPTION>

                                                 1997        1996      1995
<S>                                           <C>         <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                             $  (127)    $  (136)    $   (52)
(Gain) loss on sale of property                               (36)
Adjustments to reconcile net income (loss) to
  net cash provided by operating activities:
Depreciation and amortization                     389         343         267
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable        (40)          6         (15)
Decrease (increase) in prepaid expenses
  and deposits                                     10         (12)         (2)
(Decrease) increase in accounts payable            28         (51)         64
(Decrease) increase in other liabilities          (13)         24         (50)
Net cash provided by operating activities         247         138         212

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures                             (584)       (825)       (868)
Sale of investment property                       800         208           0
Investment in short-term investments                0          99          99
Net cash provided (used in) investing activities  216        (518)       (769)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from financing                             0         563       5,707
(Distributions) contributions net                   0        (187)       (421)
Payments on notes payable                        (281)       (164)     (4,401)
Net cash provided by (used in)
  financing activities                           (281)        212         885

Increase (decrease) in cash and
  cash equivalents                                182        (168)        328
Cash and cash equivalents at beginning of year    388         556         228

Cash and cash equivalents at end of year      $   570     $   388     $   556

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

</TABLE>
<PAGE>

LIF

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands except for Partnership units)

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization - LIF (the "Partnership") is a limited partnership
organized under the laws of the state of California for the purpose
of investing in income properties and making short-term loan and
capital contributions to operating entities formed to acquire or
develop and operate one or more income producing real
properties.  The General Partner is Partners '85 (the "General
Partner"), a California limited partnership, whose General Partner
is Landsing Equities Corporation.  LIF was formed in June 1984,
and shall continue until December 31, 2034, unless sooner
terminated.

Investment In Real Estate Partnership - At December 31, 1997
and 1996, the Partnership was invested in Landsing Private Fund
("P-21"), a 99% owned real estate partnership. In 1997, Cattle Creek
Development Partners (CCDP) was liquidated into the Partnership. For a portion
of 1996, the Partnership was invested in Prince Creek Partners
("PCP") and Thompson Creek Partners ("TCP").  In 1996, the properties
owned by these partnerships were sold and the partnerships terminated.
During 1996, the Partnership invested into a new entity - Alpine Center
Partners ("ACP").  The Partnership acquired rental real estate in Colorado
in 1996.

Consolidation of Investment in Real Estate Partnerships - For financial
reporting purposes, the Partnership consolidates the operations of it's
investment in real estate partnerships with that of the Partnership.  All
significant intercompany transactions and balances have been eliminated.
Minority interest was insignificant at December 31, 1997 and 1996.

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

<PAGE>

Deferred Loan Costs - Loan fees are deferred and amortized over
the life of the related note payable.

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

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

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

Net Income (Loss) Per Partnership Unit - Per Partnership Unit" amounts are
based on weighted average units outstanding of 12,820 in 1997, 1996 and 1995,
after giving effect to net income (loss) allocated to the General Partner
of $0 in 1997, $0 in 1996, and $0 in 1995.  Cash distributions of
$15 per unit were paid to holders in 1996.  No cash distributions were
paid in 1997.  The General Partner has declared a cash distribution of
$15 per unit to holders of record as of February 28, 1998, to be paid
in March 1998.

Concentrations of Credit Risk - The Partnership's financial
instruments that are exposed to concentrations of credit risk
consist primarily of its cash and cash equivalents.  The
Partnership's cash and cash equivalents are in high-quality
institutions with high credit ratings.  This investment policy limits
the Partnership's exposure to concentrations of credit risk.

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

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

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

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

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

Reclassifications - certain amounts in the 1996 financial statements have been
reclassified to conform to the 1997 presentation.

<PAGE>

2. RELATED PARTY TRANSACTIONS

The Partnership has entered into agreements with Pacific Coast
Capital.  Advisory services for investment management, general
and administrative and property management are provided by
Pacific Coast Capital.  The General Partner is an affiliate of
Pacific Coast Capital.  The related party transactions delineated in
the Partnership Agreement with affiliates of the General Partner
are as follows:

                                                1997      1996      1995

General and Administrative Support Fees        $ 103     $ 103     $ 103

Property Management                            $  36     $  25     $  28

Accounts Receivable                            $  17     $   0     $   0

During 1997 the Partnership had a sale transaction with the President of the
General Partner and another entity. (See Note 3)

3. NOTES RECEIVABLE

At September 30, 1997, Alpine Center Partnership (ACP) sold 40.2% and 45.9%,
respectively, of the Alpine Center Building to Gary K. Barr, president of the
general partner of LIF, and to Open World Investors, Ltd., whose general
partner is Gary K. Barr.  Open World Investors, Ltd. is also managed by PCC.
These sales were made for cash and notes receivable.  In 1996, ACP sold
11.94% of the Alpine Center Building to an unrelated third party for cash.

The notes receivable generated from the sale to Barr and Open World Investors,
Ltd., were $864 and $987, respectively.  The terms of the notes receivable are
the same as the financing terms ACP has with the bank and LIF on loans secured
by the Alpine Center Building.  ACP received no payments on these notes
receivable as of December 31, 1997.

The sales agreements stipulate that each buyer assume debt that ACP has
related to the Alpine Center Building up to their respective percentage
ownership except for the sale to the unrelated third party, whose debt
assumption was capped at $256.

At the dates of the sales, the Alpine Center Building consisted of land, one
existing commercial building and one commercial building (Phase II) planned for
construction after 1997.  The liability for future improvements at December 31,
1997 if $828 represents the estimated future costs of constructing Phase II.
Also, the gain on the sale of the Alpine Center Building is deferred at
December 31, 1997.

<PAGE>
<TABLE>

4. RENTAL PROPERTY

 Rental property consists of the following:
<CAPTION>
                                                1997      1996
<S>                                          <C>       <C>
Land                                         $ 1,520   $ 1,922
Building and improvements                      8,807     9,676
Total                                        $10,327   $11,598
Accumulated depreciation                      (2,607)   (2,282)
                                             $ 7,720   $ 9,241

</TABLE>
Depreciation expense was $325 and $304 for the years ended December 31, 1997
and 1996, respectively.

The residential leases are generally for a term of one year or less or are on a
month-to-month basis.  Retail leases range from one to five years in length.

<TABLE>

5. NOTES PAYABLE
<CAPTION>
                                                             1997      1996
<S>                                                        <C>      <C>
First note payable bears interest at 8%, matures
  September 1, 2000, and is collateralized by
  Whistler Point Apartments. The note requires monthly
  payments of principal and interest of $42 per month.
  In addition the note is guaranteed by the Landsing
  Corporation.                                             $5,301   $5,373

First note payable collateralized by the Valley View
  Business Park, with an interest rate of 9.00%, and
  monthly payments of $11, matures on December 10, 1998.    1,035    1,068

Second note payable collateralized by the Valley View
  Business Park, with an interest rate of 8.5% and monthly
  payments of $2, matures on August 28, 2004.                 162      199

First note payable collateralized by 701 Cooper commercial
  building, with an interest rate of 9.99% and monthly
  payments of $3, matures on October 7, 2001.                 319      324

First note payable collateralized by Alpine Center, with
  an interest rate of 8.75% and monthly payments of $9,
  matures on June 3, 1998.                                    862      996

TOTAL                                                      $7,679   $7,960

</TABLE>
<PAGE>

The Partnership paid interest of $658 in 1997, $533 in 1996 and $482 in 1995.

Principal payments required in future years are as follows:

            1998         $ 2,463
            1999             104
            2000           5,091
            2001              10
            2002              11
            Total        $ 7,679


6. RENTAL PROPERTIES UNDER OPERATING LEASES

Minimum future rents from rental properties under operating
leases having initial or remaining noncancelable lease terms in
excess of one year at December 31, 1997, are as follows:

           1998            $ 253
           1999              208
           2000              197
           2001              166
           2002               25
          Total            $ 849

Annual rents at Whistler Point Apartments are not included since the leases are
generally less than one year.  Whistler Point Apartments average annual rents
collected from 1995 to 1997 were $1,305 per year.

<PAGE>
<TABLE>

7. RECONCILIATION TO INCOME TAX BASIS OF ACCOUNTING

The difference at December 31, 1997, 1996 and 1995, between
the basis of accounting used in the accompanying consolidated
financial statements and the income tax basis used to file the
Partnership's federal income tax return are as follows:

<CAPTION>
                                               1997        1996        1995
<S>                                          <C>         <C>         <C>
Net income (loss)                            $  (127)    $ (136)     $  (52)
Remove book (income) loss from partnership
  investments                                     93         96         (43)
Difference in book vs. tax loss from
  partnerships                                    26       (175)        (86)
Net income (loss) - tax basis                     (8)      (215)       (181)

Partners' equity                               1,479      1,606       1,929
Remove equity in partnership investments                   (383)       (453)
Restatement of cumulative elimination           (383)         0           0
Syndication costs                              1,906      1,906       1,906
Liquation of Cattle Creek Partners               (17)         0           0
Investment in partnerships                      (842)      (978)       (803)
Partners' equity - tax basis                   2,143      2,151       2,579

</TABLE>

8. CONTINGENCIES

In 1996, two tenants of the Valley View property initiated legal filings
against the Partnership alleging disruption of business during the property's
remodel.  The case is currently scheduled for a jury trial.  The Partnership's
defense is being handled by their insurance carrier, who has retained a
reservation of rights against the Partnership.  While it is not feasible to
predict the final outcome of this proceeding, an estimate of potential loss
is up to $96. Management does not believe the outcome will result in a
materially adverse effect on the Partnership's financial position, results of
operations or liquidity.

9. FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value is the amount at which a financial instrument could be exchanged in
a current transaction between willing parties, other than in a forced sale or
liquidation, and is best evidenced by a quoted market price, if one exists.

Fair value estimates are made as of a specific point in time based on the
characteristics of the financial instruments and relevant market information.
Where available, quoted market prices are used. In other cases, fair values
are based on estimates using present value or other valuation techniques.
These techniques involve uncertainties and are significantly affected by the
assumptions used and judgments made regarding risk characteristics of various
financial instruments, discount rates, estimates of future cash flows, future
expected loss experience and other factors. Changes in assumptions could
significantly affect these estimates and the resulting fair values. Derived
fair value estimates cannot be substantiated by comparison to independent
markets and, in many cases, could not be realized in an immediate sale of the
instrument. Also, because of differences in methodologies and assumptions used
to estimate fair values, the Partnership's fair values should not be compared
to those of other partnerships.

Fair value estimates are based on existing financial instruments without
attempting to estimate the value of anticipated future business and the value
of assets and liabilities that are not considered financial instruments.
Accordingly, the aggregate fair value amounts presented do not purport to
represent the underlying market of the Partnership.

Assets for Which Fair Value Approximates Carrying Value - The fair value of
certain financial assets carried at cost, including cash and cash equivalents
and accounts receivable are considered to approximate their respective
carrying values due to their short-term nature and negligible credit losses.

Liabilities for Which Fair Value Approximates Carrying Value - The fair value
of accounts payable, accrued liabilities and accrued interest payable is
considered to approximate their respective book values due to their
short term nature.

Notes Payable - The valuation of notes payable with floating rates is
estimated to be the same as carrying value.  Fair value of notes payable with
fixed rates is estimated based on quoted market prices for similar issues.
At December 31, 1997 and 1996, fair value of notes payable approximates
carrying value.

10.  SUBSEQUENT EVENTS

The Partnership has declared a cash dividend of $15 per unit to unit holders
as of February 28, 1998 for distribution in March, 1998.

<PAGE>
<TABLE>

SCHEDULE III

LIF
(A California limited partnership)

REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1997
(In thousands)


<CAPTION>
                                                                                  LIFE ON
                                                   RESERVE                        WHICH
                                  COST OF          FOR       DATE OF              DEPRECIA-
DESCRIP-         ENCUM-   INITIAL IMPROVE-         DEPRECIA- CONSTRUCT- DATE      TION IS
TION             BRANCES  COST    MENTS    TOTAL   TION      TION       ACQUIRED  COMPUTED
<S>              <C>      <C>     <C>      <C>     <C>       <C>        <C>       <C>
Whistler Point
Apartments
Boise, Idaho     $5,301   $7,298  $  902   $ 8,200 $2,453    N/A        12/23/85  40 years

Valley View
Business Park
Glenwood Springs,
Colorado          1,197      938     809     1,747    130    N/A        08/28/94  40 years

701 Cooper-Commercial
Glenwood Springs,
Colorado            319      320       1       321     23    N/A        06/30/94  40 years

Alpine Center Bldg.
Carbondale,
Colorado          1,094       43      16        59      1    N/A        06/03/96  40 years

                 $7,911   $8,599  $1,728   $10,327 $2,607
</TABLE>
<PAGE>

SCHEDULE III
LIF

REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1997
(In thousands)

NOTES:

(1)   The Partnership's policy is to invest in income producing real
      properties and make short-term loans and capital contributions to
      operating entities formed to acquire or develop and operate one or
      more income producing real properties.  Costs incurred before
      completion of the development are included in building basis.
      Costs incurred after completion of the development projects and
      costs incurred subsequent to the purchase of completed projects
      are included as improvements.

(2)   Depreciation is computed by the straight-line method on lives of
      five to forty years.

(3) ACP has sold 98.04% of the Alpine Center Building. Approximately $1,083
    of Debt will be assumed by the new owners of the building.

<PAGE>

E X H I B I T   I N D E X

Exhibit Number
in Accordance with
    601 of
 Regulation S-K                      Exhibit Description

     3.1              Amended and Restated Certificate and Agreement of
                      Limited Partnership of LIF, a California limited
                      partnership, filed as Exhibit 3 to Partnership's
                      Registration Statement No. 2-94509 on Form S-11, as
                      amended, is incorporated herein by reference.

     3.2              Assignment Agreement, filed as Exhibit 10.1 to
                      Partnership's Registration Statement No. 2-94509 on
                      Form S-11, as amended, is incorporated herein by
                      reference.

    10.1              Agreement of Limited Partnership for Cattle Creek
                      Development Partners, Ltd. (Incorporated by reference
                      to Form 8-K dated August 31, 1994)

    10.2              Promissory Note to LIF. (Incorporated by reference to
                      Form 8-K dated August 31, 1994)

    10.3              Bill of Sale, along with the Closing and Settlement
                      Agreement for the acquisition of Valley View Business
                      Park. (Incorporation by reference to Form 8-K dated
                      August 31, 1994)

    10.4              Promissory Note to Alpine Bank, along with related Deed
                      of Trust. (Incorporated by reference to Form 8-K dated
                      August 31, 1994)

    10.5              Promissory Note to Norman Overacker and Elaine
                      Overacker, along with related Deed of Trust.
                      (Incorporated by reference to Form 8-K dated
                      August 31, 1994)

    10.6              Closing and Settlement Agreement for acquisition of 701
                      Cooper Avenue Building. (Incorporated by reference to
                      Form 8-K dated August 31, 1994)

    10.7              Promissory Note to Alpine Bank, along with related Deed
                      of Trust. (Incorporated by reference to Form 8-K dated
                      August 31, 1994)