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 0-13559

                                 LDP-III
            (Exact name of registrant as specified in its charter)

          California                                        94-2911983
(State or other jurisdiction of                          (I.R.S. Employer
  incorporation or organization)                       Identification Number)

                    P. O. Box 130, Carbondale, CO 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>

LDP-III

FORM 10-K

FOR THE YEAR ENDED DECEMBER 31, 1997

TABLE OF CONTENTS

Form 10-K

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
                      Partnership 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.     Changes in and Disagreements With Accountants
                      on Accounting and Financial Disclosure

Part III
     Item 10.    Directors and Executive Officers of the Partnership
     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 Schedule and Reports
                      on Form 8-K

Signatures

Index to Financial Statements and Supplemental Financial Statement Schedules

<PAGE>

PART I

ITEM 1.    BUSINESS

LDP-III (the "Partnership") is a limited partnership which was organized under
the Uniform Limited Partnership Act of the State of California on August 30,
1983.  The Partnership was organized as a non-specified property limited
partnership to acquire a diversified portfolio of real properties, including
commercial, residential and agricultural properties, located primarily within
the western portion of the United States.  The General Partner of the
Partnership is Landsing Partners-III (the "General Partner") , a partnership
having two General Partners, Landsing Equities Corporation, a California
corporation which is the managing partner of the General Partner, and Partners
'84, a California limited partnership.

The Partnership's business consists of a single segment - equity investments
in leveraged income-producing real property.  For a schedule of the
Partnership's revenue, net loss and total assets for its last fiscal year, see
Item 6, Selected Financial Data, below.  The Partnership will not be engaged
in the production of goods or the rendering of services.

The Partnership had an investment in a wholly-owned subsidiary, LDP-III Realty
Service Corporation, which owned one property, the 391 Forbes Building in
South San Francisco, California, until it was sold in August, 1996.  For
financial reporting purposes, the Partnership's investment in LDP-III Realty
Service Corporation was presented on a consolidated basis.

The Partnership requires cash reserves to finance property operations.  Cash
reserves totaled $2,008,000 at December 31, 1997.  Funds not invested in real
property are placed in temporary high-grade investments which can be readily
liquidated.  The General Partner has declared a cash distribution of $45 per
unit to unit holders of record on February 28, 1998, to be paid in March, 1998.

Results of the Partnership's operations depend primarily upon the successful
operation of its existing investments.  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.  See Item 7, Management's Discussion and Analysis of Financial
Condition and Results of Operations, for a more specific discussion of the
impact of the foregoing factors on the Partnership's financial condition,
operations and liquidity.

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 remainder of its current
fiscal year or during its 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.

The Partnership is currently in the process of selling its properties.
One property was sold in 1997, the 1201 Cadillac property.  The remaining
property, Jefferson Place Office Building, will be placed on the market in
1998.

<PAGE>

ITEM 2.    PROPERTIES

A description of the income-producing properties which the Partnership owned
at December 31, 1997 is as follows:
                                              Financial
                                              Occupancy    Physical   Average
                                    Net       For the     Occupancy  Effective
                                  Rentable    Year Ended     At        Rental
Name/Location         Type        Sq. Feet    12/31/97     12/31/97     Rate
                                                 (1)         (2)        (3)

Jefferson Place  Office Building   54,344         95%         93%      $12.22

(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.

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

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

The remaining Partnership property is subject to an encumbrance. Reference is
made to Schedule XI to the Financial Statements filed as part of this annual
report for information regarding such encumbrances.

ITEM 3.    LEGAL PROCEEDINGS

           None.

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

No matter has been submitted to a vote of security holders, through
solicitation of proxies or otherwise, during fourth quarter 1997.

<PAGE>
<TABLE>

PART II

ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY
           AND RELATED PARTNERSHIP 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, as amended.

The approximate number of record holders of Units of the Partnership as of
January 1, 1998, is 4,057.

The limited partners of the Partnership (the "Limited Partners") are entitled
to certain distributions under the Amended and Restated Certificate and
Agreement of Limited Partnership of the Partnership.

ITEM 6.    SELECTED FINANCIAL DATA <F1>
           (In thousands, except per Unit amounts)

<CAPTION>
                                        For the years ended December 31
                                   1997     1996     1995     1994     1993
<S>                             <C>       <C>      <C>      <C>      <C>
Rental Revenue                  $ 1,275   $ 1,210  $ 1,339  $ 2,101  $ 2,934
Agricultural Revenue                  0         0        0        0      369
Net Income (Loss)                 2,838      (193)    (334)    (259)    (173)
Net Income (Loss) Per Unit<F2>       76        (5)      (9)      (7)      (5)
Total Assets                      5,304     6,954    8,636    9,286   17,451
Long-term Obligations             2,452     6,891    7,871    8,167   15,218
Cash Distributions Per Unit           0        15        0       14        0

<FN>
<F1>
(1)  Financial data of the Partnership for 1997 is not comparable to that of
1996, 1995 or prior periods because the Partnership did not own the same number
of properties throughout these periods.  For a more specific discussion of the
impact of the foregoing factor on the comparability of the Partnership's
financial information, see Item 7, Management's Discussion and Analysis of
Financial Condition and Results of Operations.

<F2>
(2)  Based on a weighted average of outstanding Units in 1997, 1996, 1995,
1994 and 1993.

</TABLE>
<PAGE>

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

INTRODUCTION

LDP-III is a California limited partnership formed in August 1983.  The
Partnership's business consists of a single segment  - equity investments in
leveraged income-producing real estate.

The Partnership's current portfolio consists of fee title ownership of one
property. The Partnership's property investment is: Jefferson Place Office
Building, Boise, Idaho.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31, 1997 the Partnership had cash and cash equivalents totaling
approximately $2,008,000.  Cash reserves not needed for current operations are
placed in temporary, high-grade investments which can be readily liquidated.

In August 1996, the Partnership sold its interest in the 391 Forbes Building
in South San Francisco, California.  Gross proceeds were $1,730,000, which
resulted in a gain of $223,000 and cash proceeds of $660,000.  Proceeds were
used to fund a Partnership distribution.

On December 9, 1997, the Partnership sold one of its real property investments
known as 1201 Cadillac Court, located in Milpitas, California.  The property
consisted of a 51,450 square feet commercial building.

The sale price received by the registrant was $6,800,000 which resulted in a
gain of $3,020,000 and cash proceeds of $1,796,000.

The Partnership has invested $1,882,000 in short-term federally insured
certificates of deposit which mature on a date less than 90 days or 3 months
from the date of purchase.  Due to this characteristic, these deposits are
classified as "cash and cash equivalents."

During 1997, the Partnership experienced a net increase in cash and cash
equivalents of $1,923,000.  Sources of cash during the year were from regular
Partnership Operations and the sale of 1201 Cadillac.  Cash uses during 1997
were:  $262,000 for property capital expenditures and lease commissions, and
$31,000 for principal payments on notes payable.  As of December 31, 1997,
cash and cash equivalents totaled $2,008,000 versus a balance of $383,000 at
December 31, 1996.

The Partnership's most significant current uses of cash reserves are for
principal payments on outstanding debt balance and capital expenditures needed
to maintain properties and current occupancy rates.

<PAGE>

In prior years, the Boise and San Francisco Bay Area marketplaces, where
certain of the Partnership's real estate assets are located experienced a
significant imbalance between supply and demand.  Historic high building
activity and declining economic conditions in these markets produced high
vacancies in industrial and commercial properties.  As a result, market rate
rents declined. Due to these conditions the Partnership suffered recurring
losses and negative cash flows from operations.  Market conditions have
improved in 1996 and 1997, and are expected to continue to improve in 1998.

The Partnership made a cash distribution to its limited partners of $15.00 per
unit during 1996.  There were no distributions in 1997.  All future sale
proceeds will be used to increase reserves, reduce indebtedness and/or make
distributions to investors.  Because of the sale of the 1201 Cadillac property
in December 1997, the Partnership had significant cash reserves as of December
31, 1997.  The General Partner has declared a cash distribution of $45 per
unit to unit holders of record on February 28, 1998.  This distribution will
be paid in March, 1998.

The Partnership is currently in the process of selling its properties.  One
property was sold in 1997, the 1201 Cadillac property.  The other property,
the Jefferson Place Office Building, will be placed on the market in 1998.

Management believes that the cash reserves plus proceeds from operations and
property sales will be sufficient to meet the viable operating costs of the
partnership as it continues through this liquidation phase.

<PAGE>

RESULTS OF OPERATIONS

Overall, rental income increased 5% in 1997 versus 1996.  1996's revenue
decreased 9% from the 1995 level.  The 1996 decrease was due to the sale of
391 Forbes in August 1996.  The 1997 increase was due to the increase in lease
amounts from the sole tenant of the 1201 Cadillac property during the 5 months
prior to the sale of the property in December, 1997.

Interest income in 1997 decreased 10% from that in 1996.  This was the result of
lower average cash balances held by the Partnership.

Revenues for the two properties owned continuously for the three year period
increased 18% from 1996 to 1997, and decreased 1% from 1995 to 1996.

Overall, operating expenses on rental properties decreased 21% in 1997 versus
1996, or $100,000.  In 1996, operating expenses increased 19% versus 1995.
The 1997 decrease was a result of lower property tax expense and management
fees.

Interest expense decreased 11% in 1997 versus 1996.  The decrease was caused
by the reduced amount of property indebtedness due to the disposition of
properties in 1997.  Interest expense in 1996 decreased 6% versus 1995.  This
decrease was also the result of disposition of properties.  The partnership
indebtedness is currently all at fixed rates.  Thus, the partnership will not
be impacted by the current changes in the interest rate environment.

Depreciation and amortization expense decreased 2% and 17% from 1996 to 1997,
and 1995 to 1996 respectively.  The decrease in depreciation expense was due
to the disposition of properties during these periods.

General and administrative expenses increased 5% in 1997 versus 1996.  1996's
general and administrative expenses decreased 7% from 1995.  The increase from
1996 was a result of increased costs of outside professional and transfer
agent fees.

Net loss of the Partnership before gain from sale of real estate decreased 56%
in 1997 versus 1996.  This decrease is primarily the result of decreased
operating expenses, and higher rents.    Net loss of the Partnership in 1996
increased 24% versus 1995.  This increase resulted from higher operating costs
in 1996 versus 1995.

<PAGE>
<TABLE>

A comparison of the operations of the two properties operated continuously
through 1997, 1996 and 1995 is provided below:

<CAPTION>

                                             1997         1996         1995
<S>                                        <C>          <C>          <C>
Rental Revenue                             $ 1,275      $ 1,076      $ 1,095
Rental Operating Expense                       372          436          344
Net Operating Income                       $   903      $   640      $   751

Interest Expense                           $   596      $   608      $   611

Rental revenues decreased 1% for 1996 compared to 1995.  Rental revenues
increased 18% from 1996 to 1997 due to the lease renewal with the sole tenant
of the 1201 Cadillac property.

Operating expense decreased 17% from 1996 to 1997.  This decrease is the
result of a decrease in general and administrative expenses on continuously
owned properties.  Rental operating expense on continuously owned properties
increased 26% from 1995 to 1996 due to higher maintenance and upkeep at
Jefferson Place and higher property taxes at 1201 Cadillac.

INFLATION

The Partnership's rental revenues in the overbuilt real estate markets of
Boise and San Francisco, have not followed the overall inflationary trends of
the economy.  In the future, the General Partner believes market rate rents in
those areas will more closely follow or exceed inflation.  Operating costs for
properties in most  of the Partnership's markets have continued to follow
inflationary trends.  It is not expected that the Partnership will be
materially impacted by inflationary forces in the near term.

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.

</TABLE>
<PAGE>

PART III

ITEM 10.    DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The General Partner of the Partnership is Landsing Partners-III (LP-III),
which has sole responsibility for all aspects of the Partnership's operations.
LP-III is a General Partnership having two General Partners, Landsing Equities
Corporation, a California corporation, which is the managing General Partner
of the General Partner, and Partners '84, a California limited partnership.
The organizers or promoters of the Partnership are Landsing Equities
Corporation and Gary K. Barr.  Landsing Equities Corporation and Mr. Barr are
the General Partners of Partners '84.  Mr. Barr holds the position with
Landsing Equities Corporation indicated below.

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 has 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
thebook J.K. Lasser's "Real Estate Investment Guide" published by Prentice
Hall.

ITEM 11.    EXECUTIVE COMPENSATION

The General Partner, Landsing Partners-III, and its General Partners, receive
no compensation from the Partnership.  The General Partner has contracted with
The Landsing Corporation, an affiliate, for the provision of certain asset and
property management and administrative services.  The Landsing Corporation has
subcontracted these management and administrative services to its affiliate,
Pacific Coast Capital.  During 1997, Pacific Coast Capital received management
fees of $143,000, which were determined based on expenses incurred in order to
operate the Partnership.  In addition, Pacific Coast Capital was paid $30,000
for property management services and $68,000 for leasing commissions.  These
property management fees were based on monthly property revenues received and
leasing commissions were based on % of the base rent.  See Item 13, "Certain
Relationships and Related Transactions" for further information.

<PAGE>

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

No person or group is known by the Partnership to hold more than 5% of the
Units of Limited Partnership.  The General Partner is not a direct or
beneficial owner of any Units of the limited partnership.  The General Partner
knows of no arrangements, 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 Landsing Corporation
is a closely-held corporation.

The Partnership has entered into a property management agreement with Pacific
Coast Capital for the management of the Partnership's properties.  During 1997,
Pacific Coast Capital received $30,000 for property management.

The Partnership has retained The Landsing Corporation to serve as advisor and
to manage the day-to-day operations of the Partnership.  These services are
provided under a subcontract with Pacific Coast Capital, an affiliate of The
Landsing Corporation.  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, Pacific Coast Capital received expense reimbursements
of $143,000.

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 at page F-1.

                   2.     Financial Statements Schedules
                          See the Index at page F-1.

                   3.     Exhibits

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

           (b)     The Partnership filed one report on Form 8-K during the
                   quarter ended December 31, 1997, to report the "Disposition
                   of an Asset".

<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.

                                  LDP-III

                          By:     Landsing Partners-III, General Partner

                             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
Pursuantto 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 sent, Partnership shall furnish copies of such material to the
Commission.

<PAGE>

LDP-III

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

Report of Independent Accountants

Financial Statements:

Balance Sheets, December 31, 1997 and 1996
Statements of Operations for the Years Ended
  December 31, 1997, 1996 and 1995
Statements of Changes in Partners' Equity (Deficit)
  for the   Years Ended December 31, 1997, 1996 and 1995
Statements of Cash Flows for the Years Ended
  December 31, 1997, 1996 and 1995
Notes to Financial Statements

Supplemental Financial Statement Schedule:

Schedule III - Real Estate and Accumulated Depreciation
  at December 31, 1997


<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the General Partner of LDP-III:

We have audited the accompanying consolidated financial statements and
financial statement schedule of LDP-III and subsidiary listed in the index on
page F-1 of this Form 10-K as of December 31, 1997 and 1996, and the related
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
schedules 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 LDP-III as of December 31,
1997 and 1996, and the 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 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>

LDP-III
BALANCE SHEETS, DECEMBER 31, 1997 and 1996
(In thousands except unit amounts)

<CAPTION>

                                                      1997          1996
<S>                                                   <C>           <C>
ASSETS

INVESTMENTS IN REAL ESTATE:
Rental properties (including property held for sale)  $  5,985      $ 10,510
Accumulated depreciation                                (2,817)       (4,086)
                                                         3,168         6,424

CASH AND CASH EQUIVALENTS (including interest bearing
    deposits of $1,947 in 1997 and $85 in 1996)          2,008            85

OTHER ASSETS:
Short-term investments                                       0           298
Accounts receivable                                         37            17
Prepaid expenses and deposits                                1             4
Loan costs and leasing commissions (net of accumulated
     amortization of $359 in 1997 and $474 in 1996)         90           126
Total other assets                                         128           445

TOTAL                                                 $  5,304      $  6,954

LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

LIABILITIES:
Notes payable                                         $  2,452      $  6,891
Accounts payable                                             0             0
Other liabilities                                           84           133
Total liabilities                                        2,536         7,024

PARTNERS' EQUITY (DEFICIT)
General Partners Equity                                      0             0
Limited Partners Equity (Deficit)                        2,768           (70)

TOTAL                                                 $  5,304      $  6,954

Equity Units Authorized   - Limited Partners            37,156        37,156
                          - General Partners                 0             0

Equity Units Outstanding  - Limited Partners            37,136        37,136
                          - General Partners                 0             0

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

</TABLE>
<PAGE>
<TABLE>

LDP-III

STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(In thousands except unit amounts)

<CAPTION>
                                                1997      1996       1995
<S>                                         <C>        <C>        <C>
REVENUE:
Rental                                      $  1,275   $ 1,210    $  1,339
Interest                                          20        22          28
Total revenue                                  1,295     1,232       1,367

EXPENSE:
Interest                                         596        67         717
Operating                                        372       472         394
Depreciation and amortization                    319       325         396
General and administrative                       190       180         194
Total expense                                  1,477     1,648       1,701

LOSS BEFORE GAIN FROM SALE OF
     REAL ESTATE                                (182)     (416)       (334)
GAIN FROM SALE OF REAL ESTATE                  3,020       223           0
NET INCOME (LOSS)                           $  2,838   $  (193)    $  (334)
NET INCOME (LOSS)-LIMITED PARTNERS          $  2,838   $  (193)    $  (334)
NET INCOME (LOSS)-GENERAL PARTNERS                 0         0           0

TOTAL                                       $  2,838   $  (193)    $  (334)
NET INCOME (LOSS) PER PARTNERSHIP UNIT:
      LIMITED PARTNERS                      $     76   $    (5)    $    (9)
      GENERAL PARTNERS                             0         0           0

TOTAL                                       $     76   $    (5)    $    (9)

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

</TABLE>
<PAGE>
<TABLE>

LDP-III

STATEMENTS OF CHANGES IN PARTNERS' EQUITY (DEFICIT)
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(In thousands except unit amounts)

<CAPTION>
                         LIMITED PARTNERS                         TOTAL
                            NUMBER OF               GENERAL     PARTNERS'
                           PARTNERSHIP              PARTNER      EQUITY
                             UNITS       AMOUNT     AMOUNT      (DEFICIT)

<S>                          <C>        <C>         <C>         <C>
BALANCE, JANUARY 1, 1995     37,141     $ 1,013     $  0        $ 1,013
Abandonments                     (5)
Net loss - 1995                            (334)                   (334)

BALANCE, DECEMBER 31, 1995   37,136         679        0            679
Distribution-1996                          (556)       0           (556)
Net loss - 1996                            (193)       0           (193)

BALANCE, DECEMBER 31, 1996   37,136         (70)       0            (70)
Net Income - 1997                         2,838        0          2,838

BALANCE, DECEMBER 31, 1997   37,136     $ 2,768    $   0        $ 2,768


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

</TABLE>
<PAGE>
<TABLE>

LDP-III

STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(In thousands except unit amounts)

<CAPTION>
                                                   1997       1996       1995
<S>                                             <C>        <C>        <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                               $ 2,838    $  (193)   $  (334)
Adjustments to reconcile net loss to net cash
   used in operating activities:
Gain from sale of real estate                    (3,020)      (223)         0
Depreciation                                        319        325        342
   Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable          (20)         7         13
Decrease in prepaid expenses and deposits             3          4          1
Decrease in accounts payable                          0         (5)       (27)
Increase in accrued interest payable                 19          0          0
Increase (decrease) in other liabilities            (68)        29          6
NET CASH PROVIDED BY (USED IN)
   OPERATING ACTIVITIES                              71        (56)         1

CASH FLOWS FROM INVESTING ACTIVITIES:
Short-term investments                              298       (100)       397
Capital expenditures and construction              (247)       (51)      (134)
Deferred expenses                                    36         21        (21)
Net proceeds from sale of rental properties       1,796        660          0
NET CASH PROVIDED BY INVESTING ACTIVITIES         1,883        530        242

CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable                           (31)       (45)      (295)
Distribution to unit holders                          0       (556)         0
NET CASH USED IN FINANCING ACTIVITIES               (31)      (601)      (295)

INCREASE (DECREASE) IN CASH
   AND CASH EQUIVALENTS                           1,923       (127)       (52)
CASH AND CASH EQUIVALENTS
   AT BEGINNING OF YEAR                              85        212        264
CASH AND CASH EQUIVALENTS AT END OF YEAR        $ 2,008    $    85    $   212

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

</TABLE>
<PAGE>

LDP-III

NOTES TO FINANCIAL STATEMENTS
(In thousands except unit amounts)

1.   ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization - LDP-III (the "Partnership") is a limited partnership organized
under the laws of the state of California for the purpose of acquiring,
operating, holding for investment, and ultimately selling income producing real
estate.  Landsing Partners-III (the "General Partner") is a California General
Partnership whose partners are Landsing Equities Corporation and Partners '84.
LDP-III was formed on August 30, 1983, and shall continue until December 31,
2033, unless sooner terminated.  The Partnership commenced operations on
December 9, 1983, with the acquisition of the first property.

The Partnership owns one building located in Idaho, which is a commercial
office building with numerous tenants.

Investment in Subsidiary - On December 3, 1992 the Partnership transferred two
of its properties, the 533 Cabot Building and the 391 Forbes Building to its
wholly owned subsidiary, LDP-III Realty Service Corporation, which filed
bankruptcy under Chapter 11 of the Federal Bankruptcy Code.  During 1993, the
U.S. Bankruptcy case was dismissed and the 533 Cabot Building was disposed of.
In 1996, 391 Forbes Building was sold and the subsidiary dissolved.  For
financial reporting purposes the Partnership consolidated the operation of the
subsidiary with that of the Partnership.  All significant intercompany
transactions and balances have been eliminated.

Rental Properties - Rental properties are stated at the lower of cost or
recoverable value.  Depreciation is computed by the straight-line method over
estimated useful lives ranging from five to forty years. Tenant improvements
are amortized over the lives of the related tenant leases which range from
one to ten years.  Major additions 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.

Loan Costs and Leasing Commissions - Amounts paid to obtain loans are deferred
and amortized over the lives of the related notes payable, which range from
four to ten years.  Leasing commissions are amortized over the lives of the
tenant leases which range from one to ten years.

<PAGE>

Cash and Cash Equivalents - The Partnership considers all highly liquid
investments with a maturity of three months or less from the date 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 financial statements because these taxes are the obligation of the partners.

Net Loss Per Partnership Unit - Net loss per Partnership unit is based on
weighted average units outstanding after giving effect to net income (loss)
allocated to the General Partner.

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
maintained in various accounts in FDIC insured institutions. This investment
policy limits the Partnership's exposure to concentrations of credit risks.

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 and
bereviewed 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.  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 financial statements.  The impact of the delayed provisions is
also not expected to be material.

<PAGE>

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 SFAS in 1998 but does not
expect an impact on its 1998 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.

Adequate Capital Resources - The General Partner believes that despite the
fact the Partnership has continued to operate at a net loss before gain from
the sale of properties, the Partnership has adequate capital resources to
continue operations.  Operating results at Jefferson Place in Idaho, the only
remaining property, indicate the property is operating at a positive cash
flow position.  The California property, 1201 Cadillac, was sold for profit
in December 1997.Proceeds of the sale increased cash reserves and will allow
the Partnership to make a cash distribution to limited partners in 1998.

The General Partner believes that due to the disposition of certain properties
and the stability of the remaining property in the portfolio, that operations
will generate positive cash flow.  Net loss before gains from sales of real
estate decreased to $182 in 1997, compared with $416 in 1996 and $334 in 1995.
The Partnership expects this positive trend to continue.

In the event the Partnership must liquidate its assets, management believes
the costs of the assets will be recovered and excess funds would be available
after satisfaction of all liabilities.

Restricted Cash - At December 31, 1997 and 1996, there was restricted cash of
$0 and $37, respectively.  The cash balance was related to an escrow
agreement for tenant security deposits.

<PAGE>
<TABLE>

2.   RELATED PARTY TRANSACTIONS

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

<CAPTION>
                                              1997        1996        1995
<S>                                         <C>         <C>          <C>
     General and Administrative Support     $  143      $  132       $  194
     Property Management                        30          32           38
     Leasing Commissions                        68           0            0

</TABLE>
<TABLE>

3.   RENTAL PROPERTIES

Rental properties at December 31 consist of the following:

<CAPTION>
                                             1997        1996
<S>                                       <C>         <C>
     Land                                 $   213     $  1,384
     Building and improvements              5,772        9,126
                                            5,985       10,510
     Accumulated depreciation              (2,817)      (4,086)
                                            3,168        6,424

</TABLE>

Depreciation expense for the years ended December 31, 1997 and 1996 was $319
and $325, respectively.

4.	REAL ESTATE

On August 16, 1996, the Partnership's wholly owned subsidiary, LDP-III Realty
Services Corporation, sold its remaining property 391 Forbes.  The sale
resulted in a gain for financial reporting purposes of $223, and cash
proceeds of $660.

On December 9, 1997, the Partnership sold the 1201 Cadillac property.  The
sale resulted in a gain for financial reporting purposes of $3,020 and cash
proceeds of $1,796.

<PAGE>
<TABLE>

5.   NOTES PAYABLE

     Notes Payable at December 31 consist of:
<CAPTION>
                                                              1997        1996
<S>                                                        <C>         <C>
First note payable collateralized by the Jefferson
   Place Building bears interest at a rate of 9.25%
   and requires payments of $23 per month.  This note
   matures August 8, 2001.                                 $ 2,452     $ 2,483

First note payable collateralized by the 1201 Cadillac
Building                                                         0       4,408

Total                                                      $ 2,452     $ 6,891

</TABLE>

During 1994, the General Partner re-negotiated the terms and conditions of the
first mortgage loan on the Jefferson Place Office Building.  In return for a
principal paydown of $50 the existing loan was reduced by $334 to an
outstanding balance of $2,814.  This new loan accrues interest at the rate of
9.25% per annum, and requires monthly principal and interest payments of $23.
The loan is all due and payable on August 8, 2001.  This reduction in the
outstanding principal balance in excess of the principal payments made
resulted in income to the partnership from forgiveness of debt of $334 in 1994.
During 1995, the Partnership made an additional principal paydown on this loan
of $243.

The loans on the 1201 Cadillac building had a principal balance of $4,408,
accrued interest at the rate of 8.5% per annum, and required interest only
payments.  The entire outstanding balance of the loan was paid on December 9,
1997 from proceeds from the sale of the property.

Rental properties are pledged as collateral for notes payable which mature
over periods ending through 2001.  Principal payments required in future years
are as follows:

                     1998     $    55
                     1999          60
                     2000          66
                     2001       2,271
                     Total    $ 2,452

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     $   566
                     1999         476
                     2000         343
                     2001         245
                     2002         191
                     Total    $ 1,821

<PAGE>
<TABLE>

7.   RECONCILIATION TO INCOME TAX BASIS OF ACCOUNTING

The differences at December 31, 1997, 1996 and 1995, between the basis of
accounting used in the accompanying financial statements and the income tax
basis used to file the Partnership's federal income tax return are as follows
(in thousands except for per unit amounts):

<CAPTION>
                                                   1997        1996       1995
<S>                                             <C>         <C>        <C>
Net income (loss)                               $ 2,838     $  (193)   $ (334)
Loss on liquidation eliminated for
   financial statement purposes                       -        (147)        -
(Increase) decrease resulted from:
   Basis difference and accelerated depreciation   (233)       (233)     (182)
Capitalize for tax purposes-special tax assessment    -          23        23
Basis difference and accelerated depreciation
   on property sold                                 252           -         -
Prepayment penalty on property sold                (265)          -         -
Investment - LDP-III Realty Service Corporation       -        (226)       12
Other                                               (20)         35         -
Net income (loss) - tax basis                   $ 2,572     $  (741)   $ (481)

Taxable income (loss) per Partnership unit      $    69     $   (20)   $  (13)

Partners' equity                                $ 2,768     $   (70)   $  679
Increase (decrease) resulted from:
   Basis of assets                                  698       1,504     1,481
   Accumulated depreciation                      (2,182)     (2,756)   (2,523)
   Syndication costs                              4,615       4,615     4,615
   Other                                              5          39         4
   Remove consolidated equity in LDP-III
     Realty Service Corp.                             -           -      (344)
   Tax investment in LDP-III Realty Service Corp.     -           -       717

PARTNER'S EQUITY - TAX BASIS                    $ 5,904     $ 3,332    $4,629

</TABLE>
<PAGE>

8.   SUPPLEMENTAL DISCLOSURE ABOUT NON-CASH INVESTING AND FINANCING ACTIVITIES

In 1997, proceeds from the sale of property were used to retire debt of $4,408.

In 1996, proceeds from the sale of building were used to retire debt of $935.
A note payable to a bank with a principal balance of $932 was refinanced.  The
new loan balance was initially $950; the increase in principal of $18 was used
for deferred loan fees and other closing costs.

9.   SUPPLEMENTAL CASH FLOW INFORMATION

The Partnership paid interest of $578 in 1997, $671 in 1996, and $717 in 1995.

10.   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.

11.  SUBSEQUENT EVENTS

The Partnership has declared a cash dividend of $45 per unit to unit holders
as of  February 28, 1998 for distribution in March, 1998.

<PAGE>
<TABLE>

SCHEDULE XI
LDP-III

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>
Jefferson Place  $2,452   $5,393  $ 592    $5,985  $2,817    N/A        12/09/83  40 years
Boise, Idaho

</TABLE>
<TABLE>

RECONCILIATION
<S>                                       <C>
Balance at beginning of period            $ 10,510

Additions during period:
   Improvements                                247

Deductions during period:
   Cost of real estate sold                 (4,772)

Balance at close of period                $  5,985

</TABLE>

NOTES:

(1)   The Partnership's policy is to purchase development and completed
projects.  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 ranging
from five to forty years.

<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 & 4                      The Partnership Agreement included as Exhibit B to
                           the Prospectus dated March 1, 1984 (Incorporated by
                           reference to Exhibit 3.4 of Form 10-K for the year
                           ended December 31, 1985)

10.1                       Commercial Contract to Buy and Sell Real Estate
                           dated December 11, 1989 between Highland Hall and
                           Landsing Diversified Properties-III

10.2                       Bill of Sale and General Warranty Deed related to
                           the sale of Silverado Apartments. (Incorporated by
                           reference to Exhibit 10.1 and 10.2 of Form 8-K
                           dated July 7, 1994)

99                         ADDITIONAL EXHIBITS

99.1                       The Prospectus dated March 1, 1984 (Incorporated by
                           reference to Exhibit 28.1 of Form 10-K for the year
                           ended December 31, 1985)

99.2                       Supplement No. 12 to Prospectus (Incorporated by
                           reference to Exhibit 28.2 of Form 10-K for the year
                           ended December 31, 1985)

<PAGE>