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

                                  FORM 10-Q

Quarterly  Report  Pursuant to Section 13 or 15(d) of the Securities  Exchange
Act of 1934


For the  Quarterly  Period  Ended:  June  30,  Commission File Number: 0-20707
1998


                     COLONIAL REALTY LIMITED PARTNERSHIP
            (Exact name of registrant as specified in its charter)



                Alabama                               63-1098468
        (State of organization)                      (IRS Employer
                                                Identification Number)

        2101 Sixth Avenue North                          35203
               Suite 750                              (Zip Code)
          Birmingham, Alabama
(Address of principal executive offices)

                                (205) 250-8700
             (Registrant's telephone number, including area code)



      Indicate by check mark  whether the  Registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant  was required to file such  reports) and (2) has been subject to such
filing requirements for the past 90 days. YES X NO ___







<PAGE>

                     COLONIAL REALTY LIMITED PARTNERSHIP
                              INDEX TO FORM 10-Q


                                                                            Page

PART I:  FINANCIAL INFORMATION

      Item 1.  Financial Statements (Unaudited)

               Consolidated Condensed Balance Sheets as of
               June 30, 1998 and December 31, 1997                         3

               Consolidated Condensed Statements of Income for the
               Three  Months and for the Six Months  Ended June 30, 1998   4
and 1997

               Consolidated Condensed Statements of Cash Flows
               for the Six Months Ended June 30, 1998 and 1997             5

               Notes to Consolidated Condensed Financial Statements        6

               Report of Independent Accountants                           10

      Item 2.  Management's Discussion and Analysis of Financial
            Condition and Results of Operations                            11

PART II:  OTHER INFORMATION


      Item 2.  Changes in Securities                                       14

      Item 6.  Exhibits and Reports on Form 8-K                            14

SIGNATURES                                                                 15

EXHIBITS                                                                   16




                                     Page 2
<PAGE>
<TABLE>
                       COLONIAL REALTY LIMITED PARTNERSHIP
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                 (in thousands)
                              ____________________
<CAPTION>

                                                 June 30, 1998
                                                  (Unaudited)  December 31, 1997
                                                  ----------      ----------
                                       ASSETS

<S>                                                <C>          <C>       
Land, buildings, and equipment, net ............   $1,483,364   $1,268,430
Undeveloped land and construction in progress ..       54,113       98,555
Cash and equivalents ...........................        2,568        4,534
Restricted cash ................................        2,697        2,665
Accounts receivable, net .......................        8,070        7,174
Prepaid expenses ...............................        2,940        3,038
Notes receivable ...............................          723          575
Deferred debt and lease costs, net .............        6,711        7,031
Other assets ...................................        5,753        4,658
                                                   ----------   ----------

                                                   $1,566,939   $1,396,660
                                                   ==========   ==========


             LIABILITIES AND PARTNERS' CAPITAL

Notes and mortgages payable ....................   $  743,441   $  702,044
Accounts payable ...............................        5,720       14,233
Accrued interest ...............................        6,812        6,526
Accrued expenses ...............................       10,439        2,700
Tenant deposits ................................        4,031        3,715
Unearned rent ..................................        2,331        2,253
                                                   ----------   ----------

     Total liabilities .........................      772,774      731,471
                                                   ----------   ----------

Redeemable units, at redemption value ..........      311,073      299,492
                                                   ----------   ----------

Partners' capital, excluding redeemable units ..      483,092      365,697
                                                   ----------   ----------

                                                   $1,566,939   $1,396,660
                                                   ==========   ==========
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>

                                     Page 3
<PAGE>
<TABLE>
                       COLONIAL REALTY LIMITED PARTNERSHIP
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                   (Unaudited)
                      (in thousands, except per unit data)
                              _____________________
<CAPTION>

                                                             Three Months Ended         Six Months Ended
                                                                 June 30,                   June 30,
                                                            ---------    ---------     ---------    ---------
                                                              1998         1997         1998         1997
                                                            ---------    ---------     ---------    ---------

Revenue:
<S>                                                         <C>          <C>          <C>          <C>      
     Minimum rent ........................................  $  48,822    $  36,100    $  96,005    $  69,760
     Percentage rent .....................................        664          370        1,442          692
     Tenant recoveries ...................................      6,958        3,785       14,239        7,205
     Other ...............................................      3,139        2,568        5,957        4,336
                                                            ---------    ---------    ---------    ---------

         Total revenue ...................................     59,583       42,823      117,643       81,993
                                                            ---------    ---------    ---------    ---------

Property operating expenses:
     General operating expenses ..........................      4,396        2,949        8,706        5,617
     Salaries and benefits ...............................      3,004        2,413        5,873        4,687
     Repairs and maintenance .............................      5,598        4,444       11,094        8,024
     Taxes, licenses, and insurance ......................      5,082        3,816        9,936        7,434
General and administrative ...............................      1,363        1,551        3,917        2,764
Depreciation .............................................     10,794        7,385       20,955       14,054
Amortization .............................................        343          371          680          725
                                                            ---------    ---------    ---------    ---------

         Total operating expenses ........................     30,580       22,929       61,161       43,305
                                                            ---------    ---------    ---------    ---------

         Income from operations ..........................     29,003       19,894       56,482       38,688
                                                            ---------    ---------    ---------    ---------

Other income (expense):
     Interest expense ....................................    (11,612)      (9,374)     (24,191)     (17,862)
     Income from unconsolidated subsidiaries .............         28          170           37          360
     Gains (losses) from sales of property ...............         65          -0-           33           (1)
     Minority interest in consolidated operating property.        -0-          (58)         -0-         (114)
                                                            ---------    ---------    ---------    ---------

         Total other expense .............................    (11,519)      (9,262)     (24,121)     (17,617)
                                                            ---------    ---------    ---------    ---------

         Income before extraordinary item ................     17,484       10,632       32,361       21,071
Extraordinary loss from early extinguishment of debt .....         (5)         (97)        (400)        (481)
                                                            ---------    ---------    ---------    ---------

         Net income ......................................  $  17,479    $  10,535    $  31,961    $  20,590
Distributions to preferred unitholders ...................     (2,735)         -0-       (5,469)         -0-
                                                            ---------    ---------    ---------    ---------

     Net income available to common unitholders ..........  $  14,744    $  10,535    $  26,492    $  20,590
                                                            =========    =========    =========    =========

Net income per unit - basic and diluted ..................  $    0.42    $    0.38    $    0.80    $    0.75
                                                            =========    =========    =========    =========

Weighted average units outstanding .......................     35,021       27,724       33,240       27,420
                                                            =========    =========    =========    =========
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>

                                     Page 4
<PAGE>
<TABLE>
                       COLONIAL REALTY LIMITED PARTNERSHIP
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)
                               ___________________
<CAPTION>
                                                                        Six Months Ended
                                                                            June 30,
                                                                           ---------
                                                                        1998         1997
                                                                      ---------    ---------

Cash flows from operating activities:
<S>                                                                   <C>          <C>      
     Net  income .................................................... $  31,961    $  20,590
     Adjustments to reconcile net income to net cash provided
         by operating activities:
         Depreciation and amortization ..............................    21,635       14,779
         Income from unconsolidated subsidiaries ....................       (37)        (360)
         Minority interest in income of property partnership ........       -0-          114
         Other ......................................................       690          787
     Decrease (increase) in:
         Restricted cash ............................................       (32)        (143)
         Accounts and notes receivable ..............................    (1,396)         106
         Prepaid expenses ...........................................       101          698
         Other assets ...............................................    (1,404)        (468)
     Increase (decrease) in:
         Accounts payable ...........................................    (8,513)      (3,769)
         Accrued interest ...........................................       286        1,063
         Accrued expenses and other .................................     6,779        2,589
                                                                      ---------    ---------
             Net cash provided by operating activities ..............    50,070       35,986
                                                                      ---------    ---------

Cash flows from investing activities:
     Acquisition of properties ......................................  (143,202)     (83,412)
     Development expenditures .......................................   (33,946)     (52,466)
     Tenant improvements ............................................    (1,420)        (784)
     Capital expenditures ...........................................    (4,714)      (4,609)
     Proceeds from sales of property, net of selling costs ..........       908          -0-
     Distributions from unconsolidated subsidiaries .................        39          392
     Capital contributions to unconsolidated subsidiaries ...........       (21)        (197)
                                                                      ---------    ---------
             Net cash used in investing activities ..................  (182,356)    (141,076)
                                                                      ---------    ---------

Cash flows from financing activities:
     Principal reductions of debt ...................................   (11,869)     (32,397)
     Proceeds from additional borrowings ............................       -0-       50,000
     Net change in revolving credit balances ........................    47,524       72,943
     Cash contributions .............................................   137,185       44,450
     Capital distributions ..........................................   (42,088)     (28,813)
     Payment of mortgage financing cost .............................       (32)      (1,021)
     Other, net .....................................................      (400)        (481)
                                                                      ---------    ---------
             Net cash provided by financing activities ..............   130,320      104,681
                                                                      ---------    ---------
             Increase (decrease) in cash and equivalents ............    (1,966)        (409)
Cash and equivalents, beginning of period ...........................     4,534        3,340
                                                                      ---------    ---------
Cash and equivalents, end of period ................................. $   2,568    $   2,931
                                                                      =========    =========
<FN>
 The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>

                                     Page 5
<PAGE>
                     COLONIAL REALTY LIMITED PARTNERSHIP
                            NOTES TO CONSOLIDATED
                        CONDENSED FINANCIAL STATEMENTS
                                June 30, 1998
                                 (Unaudited)

Note 1 -- Basis of Presentation
      Colonial Realty Limited Partnership ("CRLP") is the operating  partnership
of Colonial Properties Trust (the "Company"),  an Alabama real estate investment
trust whose shares are traded on the New York Stock Exchange.  The  accompanying
unaudited consolidated condensed financial statements of CRLP have been prepared
by management in accordance with generally  accepted  accounting  principles for
interim financial reporting and in conjunction with the rules and regulations of
the  Securities  and  Exchange  Commission.  In the opinion of  management,  all
adjustments  considered  necessary for a fair  presentation  have been included.
These financial  statements  should be read in conjunction  with the information
included  in CRLP's  Annual  Report as filed with the  Securities  and  Exchange
Commission  on Form 10-K for the year  ended  December  31,  1997,  and with the
information  filed with the Securities and Exchange  Commission on Form 10-Q for
the quarter  ended March 31, 1998.  The  December  31, 1997  balance  sheet data
presented  herein was derived from  audited  financial  statements  but does not
include all disclosures required by generally accepted accounting principles.

      In June 1997, the Financial Accounting Standards Board issued Statement of
Financial  Accounting  Standards  No.  131,  Disclosures  about  Segments  of an
Enterprise  and Related  Information  (SFAS 131),  which is effective  for years
beginning after December 15, 1997.  SFAS 131  establishes  standards for the way
that public  enterprises  report  information about operating segments in annual
financial  statements  and  requires  that  those  enterprises  report  selected
information  about  operating  segments in interim  financial  reports.  It also
establishes  standards  for related  disclosures  about  products and  services,
geographic  areas,  and major  customers.  SFAS 131 is effective  for  financial
statements  for fiscal years  beginning  after  December 15, 1997, and therefore
CRLP will  adopt  the new  requirements  retroactively  in 1998.  Management  is
currently considering the disclosure impact of the adoption of SFAS 131.

Note 2 -- Acquisitions
      Ashley  Plantation--On  May 1, 1998,  CRLP acquired Ashley  Plantation,  a
200-unit  apartment  complex developed in 1997 on approximately 21 acres of land
in Bluffton, South Carolina. The average unit size is 1,026 square feet, and the
average unit market rent is $768 per month.  The purchase price of $13.7 million
was financed through an advance on CRLP's unsecured line of credit.

      Orlando  Fashion  Square--On May 29, 1998,  CRLP acquired  Orlando Fashion
Square,  a 1.1 million square foot regional mall (including  361,000 square feet
of tenant-owned space) in Orlando,  Florida,  for a total purchase price of $104
million.  The mall anchors  include  Burdine's,  Sears,  Gayfers,  JC Penney and
General  Cinemas.  The entire  purchase  price was funded  through an advance on
CRLP's unsecured line of credit.

Note 3 -- Increase in Revolving Credit Agreement
      On July  10,  1998,  CRLP  increased  the  borrowing  capacity  under  its
unsecured line of credit from $200 million to $250 million. The credit facility,
which is used by CRLP  primarily  to finance  additional  property  investments,
bears  interest at a rate  ranging  between 80 and 135 basis points above LIBOR.
The credit  facility  is  renewable  in July 2000 with  approval  of all parties
involved and provides for a two-year amortization in the event of non-renewal.

                                     Page 6
<PAGE>
Note 4 --Cash Contributions
      On April 27, 1998, the Company closed an  underwritten  public offering of
3,046,400  shares of the  Company's  common  shares at  $30.125  per  share.  In
connection with this offering,  CRLP issued a like amount of common units to the
Company (through Colonial Properties Holding Company,  Inc.) in exchange for the
Company's   proceeds  from  this  offering.   The  net  proceeds  to  CRLP  were
approximately $86.8 million. CRLP used the net proceeds of the offering to repay
a portion of the outstanding balance on its unsecured line of credit.

Note 5 -- Net Income Per Unit
      The  following  table  sets  forth the  computation  of basic and  diluted
earnings per unit:

                                         (Amounts in thousands,
                                         except per unit data)
                                -----------------------------------------
                                  Three     Three        Six       Six
                                  Months    Months
                                   Ended     Ended     Months    Months
                                  June      June        Ended     Ended
                                    30,       30,      June      June
                                                         30,       30,
                                   1998      1997       1998      1997
                                  --------  --------   --------  --------
       Numerator:
      Numerator  for  basic and
      diluted  net  income  per
      unit    -   net    income $  14,744 $  10,535  $  26,492 $  20,590
      available    to    common
      unitholders
                                  ========  ========   ========  ========

     Denominator:
      Denominator   for   basic
      net  income  per  unit  -    35,021    27,724     33,240    27,420
      weighted  average  common
      units
      Effect    of     dilutive
      securities:
      Trustee   and    employee        53        46         53        46
      stock options
                                  --------  -------    --------  --------
          Denominator  for  diluted
      net  income  per  unit  -
      adjusted         weighted    35,074    27,770     33,293    27,466
      average common units
                                  ========  ========   ========  ========

      Basic  and   diluted  net $     .42 $     .38  $     .80 $     .75
      income per unit
                                  ========  ========   ========  ========

Options to purchase 15,000 common shares at a weighted average exercise price of
$30.69 per share  were  outstanding  during  1998 but were not  included  in the
computation  of diluted net income per unit because the options'  exercise price
was greater than the average  market price of the common shares and,  therefore,
the effect would be antidilutive.


                                     Page 7
<PAGE>
Note 6 -- Pro Forma Information (Unaudited)
      The  following  unaudited pro forma  operating  results for CRLP have been
presented  as if the 1997 and 1998  equity and debt  offerings  and the 1997 and
1998 property  acquisitions  and  dispositions  had occurred on January 1, 1997.
Unaudited  pro  forma  financial  information  is  presented  for  informational
purposes only and may not be indicative of what the actual results of operations
of CRLP would have been had the events  occurred as of January 1, 1997, nor does
it purport to represent the results of operations for future periods.

                                               (Amounts in
                                                thousands,
                                             except per unit
                                                  data)
                                           ---------------------
                                              Six Months Ended
                                                  June 30,
                                              1998       1997
                                             --------  ---------

      Revenues                             $ 130,914 $  113,998
                                             ========  =========

      Income       before        preferred $  34,878 $   35,528
      distributions
                                             ========  =========

      Net  income   available   to  common $  29,409 $   30,059
      unitholders
                                             ========  =========

      Net  income  per  unit -  basic  and $     .81 $      .82
      diluted
                                             ========  =========

The pro forma information includes the operations of the properties acquired and
disposed in 1997, as discussed in CRLP's 1997 Form 10-K, the properties acquired
in 1998 through June 30, as discussed in CRLP's Form 10-Q for the quarter  ended
March 31, 1998, and Note 2 above, and the properties acquired subsequent to June
30, 1998, as discussed in Note 7 below.

Note 7 -- Subsequent Events
      Acquisitions
      River Hills I--On July 1, 1998,  CRLP  acquired  River Hills I, a 248-unit
phase of the River Hills apartment  complex on approximately 30 acres of land in
Tampa,  Florida.  The  multifamily  community  was developed in 1985 and was 90%
leased at the time of acquisition. The purchase price of $8.5 million was funded
through an advance on CRLP's unsecured line of credit.  The average unit size is
907 square feet with average unit market rent of $549 per month.

      Haverhill  Apartments--On  July 1, 1998, CRLP acquired a 79.8% interest in
Haverhill Apartments,  a 322-unit apartment complex on approximately 19 acres of
land in San Antonio,  Texas. The multifamily community was developed in 1998 and
was 90% leased at the time of  acquisition.  The purchase price of $17.2 million
was funded through an advance on CRLP's  unsecured  line of credit.  The average
unit size is 1,019  square feet with average unit market rent of $857 per month.
The  remaining  20.2%  ownership in this property will be reflected as "minority
interest  in  consolidated  operating  property"  in  CRLP's  balance  sheet and
statement  of income,  and will be included  in  "minority  interest"  on CRLP's
statement of cash flows.

                                     Page 8
<PAGE>
      Mansell  Overlook  200 and  Shoppes  at  Mansell--On  July 1,  1998,  CRLP
completed  the final  phase of its merger  with  certain  affiliates  of Johnson
Development  Company,  LLC. The final phase  included  Mansell  Overlook  200, a
six-story  office  building  containing  163,000  square feet of space,  and the
Shoppes at Mansell, a 21,000 square foot community shopping center.

      Mansell  Overlook  200 was  developed  in 1997 and was 95% occupied at the
time of the merger. This part of the merger, valued at $27.7 million, was funded
through  the  issuance  of 396,365  limited  partnership  units  valued at $11.7
million, and an advance on CRLP's unsecured line of credit.

      The Shoppes at Mansell was also  developed in 1997 and was 95% occupied at
the time of the  merger.  The  merger  of  Shoppes  at  Mansell,  valued at $3.7
million,  was funded  through the issuance of 76,809 limited  partnership  units
valued at $2.3 million, and an advance on CRLP's unsecured line of credit.

      Shades Brook  Building--On  July 13, 1998,  CRLP acquired the Shades Brook
Building,  a three-story office building  containing 35,000 square feet of space
in Birmingham,  Alabama. Shades Brook was acquired for a total purchase price of
$3.1  million,  which was  financed  through  the  issuance  of  28,492  limited
partnership units valued at $871,000, and an advance on CRLP's unsecured line of
credit.  Shades  Brook  was  built in 1979 and was 93%  occupied  at the time of
acquisition.

      Concourse  Center--On July 23, 1998, CRLP acquired  Concourse  Center,  an
office park comprised of four multi-tenant  buildings in Tampa, Florida totaling
290,000  square feet of leasable  area.  The purchase price of $30.1 million was
financed through an advance on CRLP's unsecured line of credit. Concourse Center
was built between 1981 and 1985 and was 99% occupied at the time of acquisition.

      In The Pines  Apartments--On  July 30, 1998, CRLP acquired In The Pines, a
256-unit  multifamily  apartment  community on approximately 22 acres of land in
Augusta,  Georgia.  The community  was  developed in 1970 and 1988,  and was 98%
leased at the time of acquisition. The purchase price of $8.8 million was funded
through an advance on CRLP's unsecured line of credit.  The average unit size is
993 square feet with average unit market rent of $671 per month.

      Debt Offering
On July 14, 1998,  CRLP  completed a $175 million  public  offering of unsecured
senior notes.  The securities,  which mature in July 2007, bear a coupon rate of
7.0%,  and were priced to yield an  effective  rate of 7.09% over the  nine-year
term.  CRLP used the net  proceeds  of the  offering  to repay a portion  of the
outstanding balance on its unsecured line of credit.

      Quarterly Distributions
On July 23,  1998, a cash  distribution  was declared to partners of CRLP in the
amount of $0.55 per unit, totaling $19.8 million.  The distribution was declared
to partners of record as of August 3, 1998, and was paid on August 10, 1998.






                                     Page 9
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS



To the Board of Directors
Colonial Properties Holding Company, Inc.:

      We have reviewed the accompanying  consolidated condensed balance sheet of
Colonial Realty Limited Partnership (the "Partnership") as of June 30, 1998, and
the related consolidated  condensed statements of income for the three-month and
six-month  periods ended June 30, 1998 and 1997, and the consolidated  condensed
statements of cash flows for the six-month periods ended June 30, 1998 and 1997.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.

      We conducted our review in accordance  with  standards  established by the
American  Institute  of  Certified  Public  Accountants.  A  review  of  interim
financial  information consists principally of applying analytical procedures to
financial  data and making  inquiries of persons  responsible  for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the  expression  of an opinion  regarding the  financial  statements  taken as a
whole. Accordingly, we do not express such an opinion.

      Based on our review, we are not aware of any material  modifications  that
should be made to the accompanying  condensed  consolidated financial statements
for them to be in conformity with generally accepted accounting principles.

      We have previously audited, in accordance with generally accepted auditing
standards,  the  consolidated  balance  sheet as of December 31,  1997,  and the
related consolidated statements of operations, partners' capital, and cash flows
for the year then ended (not presented herein);  and in our report dated January
19,  1998,  except for Note 13, as to which the date is February  17,  1998,  we
expressed an unqualified opinion on those consolidated financial statements.  In
our  opinion,  the  information  set  forth  in  the  accompanying  consolidated
condensed  balance  sheet as of  December  31,  1997,  is  fairly  stated in all
material  respects in relation to the  consolidated  balance sheet from which it
has been derived.



                                                /s/ PricewaterhouseCoopers LLP
                                             PRICEWATERHOUSECOOPERS LLP

Birmingham, Alabama
July 17, 1998



                                    Page 10
<PAGE>
                     COLONIAL REALTY LIMITED PARTNERSHIP


Item 2.     Management's  Discussion  and Analysis of Financial  Condition and
            Results of Operations

General
      Colonial  Realty  Limited   Partnership   ("CRLP"),   a  Delaware  limited
partnership,  is the operating  partnership  of Colonial  Properties  Trust,  an
Alabama real estate  investment trust (the "Company") whose shares are listed on
the  New  York  Stock  Exchange.  The  Company  is  engaged  in  the  ownership,
development,  management,  and leasing of multifamily communities,  retail malls
and shopping centers,  and office buildings.  The Company is organized as a real
estate investment trust (REIT) and owns and operates  properties in eight states
in the Sunbelt  region of the United  States.  As of June 30, 1998,  CRLP's real
estate portfolio consisted of 44 multifamily communities,  38 retail properties,
and 15 office properties.

      CRLP manages its  business  with three  separate  and  distinct  operating
divisions:  Multifamily, Retail, and Office. Each division has an Executive Vice
President that oversees growth and operations and has a separate management team
that is responsible for acquiring,  developing,  and leasing  properties  within
each division.  This  structure  allows CRLP to utilize  specialized  management
personnel  for  each  operating  division.   Although  these  divisions  operate
independently from one another,  constant communication among the Executive Vice
Presidents provides CRLP with synergy allowing it to take advantage of a variety
of investment opportunities.

      The following  discussion  should be read in conjunction with management's
discussion and analysis of financial condition and results of operations and all
of the other information  appearing in CRLP's 1997 Financial Statements as filed
with the Securities and Exchange  Commission on Form 10-K and with the financial
statements included therein and the notes thereto.

      Any statement  contained in this report which is not a historical fact, or
which might be otherwise considered an opinion or projection  concerning CRLP or
its business, whether express or implied, is meant as, and should be considered,
a  forward-looking  statement as that term is defined in the Private  Securities
Litigation  Reform  Act of  1996.  Forward-looking  statements  are  based  upon
assumptions  and  opinions  concerning  a variety  of known and  unknown  risks,
including but not limited to changes in market conditions, the supply and demand
for leasable real estate,  interest  rates,  increased  competition,  changes in
governmental regulations,  and national and local economic conditions generally,
as well as other risks more  completely  described  in CRLP's  prospectuses  and
annual  reports filed with the  Securities  and Exchange  Commission.  If any of
these assumptions or opinions prove incorrect,  any  forward-looking  statements
made on the basis of such  assumptions  or  opinions  may also prove  materially
incorrect in one or more respects.

Results of  Operations  -- Three  Months Ended June 30, 1998 and 1997 Revenue --
      Total revenue increased by $16.8 million, or 39.1%, for the
second quarter of 1998 when compared to the second quarter of 1997. The majority
of this increase,  $15.4 million,  represents  revenues  generated by properties
acquired or developed  during 1998 and the second half of 1997,  net of revenues
from properties disposed of in 1997. The remaining increase primarily relates to
increases in rental rates at existing properties.

      Operating  Expenses -- Total operating expenses increased by $7.7 million,
or 33.4%,  for the second quarter of 1998 when compared to the second quarter of
1997.  The  majority  of this  increase,  $7.2  million,  relates to  additional
operating  expenses  associated  with properties that were acquired or developed
during 1998 and the second half of 1997,  net of operating  expenses  associated
with properties disposed of in 1997. The remaining increase primarily relates to
increases in operating expenses at existing properties.

                                    Page 11
<PAGE>
      Other Income and Expense -- Interest expense increased by $2.2 million, or
23.9%,  for the second  quarter of 1998 when  compared to the second  quarter of
1997.  The  increase  in  interest  expense  is  primarily  attributable  to the
assumption  of  acquisition-related  debt,  and the  increased  usage of  CRLP's
revolving credit agreement in conjunction with the financing of acquisitions and
developments.

Results of  Operations  -- Six Months  Ended June 30,  1998 and 1997  Revenue --
      Total revenue increased by $35.7 million, or 43.5%, for the
six months  ended June 30, 1998 when  compared to the six months  ended June 30,
1997.  This  majority  of this  increase,  $31.6  million,  represents  revenues
generated by properties acquired or developed during 1998 and the second half of
1997,  net of  revenues  from  properties  disposed  of in 1997.  The  remaining
increase primarily relates to increases in rental rates at existing properties.

      Operating Expenses -- Total operating expenses increased by $17.9 million,
or 41.2%, for the six months ended June 30, 1998 when compared to the six months
ended June 30, 1997.  The majority of this increase,  $14.6 million,  relates to
additional  operating expenses  associated with properties that were acquired or
developed  during 1998 and the second half of 1997,  net of  operating  expenses
associated with properties disposed of in 1997. The remaining increase primarily
relates to increases in operating  expenses at existing  properties  and overall
increases  in corporate  overhead and  personnel  costs  associated  with CRLP's
continued growth.

      Other Income and Expense -- Interest expense increased by $6.3 million, or
35.4%,  for the six months  ended June 30, 1998 when  compared to the six months
ended June 30, 1997. The increase in interest expense is primarily  attributable
to the assumption of acquisition-related debt, and the increased usage of CRLP's
revolving credit agreement in conjunction with the financing of acquisitions and
developments.

Liquidity and Capital Resources
      During the second  quarter of 1998,  CRLP invested  $142.7  million in the
acquisition and development of properties. CRLP financed this growth through the
issuance of limited partnership units,  advances on its bank line of credit, and
cash from operations. As of June 30, 1998, CRLP had one bank line of credit with
a balance  outstanding of $164.6  million.  On July 10, 1998, CRLP increased its
line of credit  to  provide  for total  borrowings  of up to $250  million.  The
increased line, which is used by CRLP primarily to finance property acquisitions
and development, bears interest at a rate ranging between LIBOR plus 80 to LIBOR
plus 135 basis  points,  expires  in July  2000,  and  provides  for a  two-year
amortization in the event of non-renewal.

                                    Page 12
<PAGE>

      On July 14,  1998,  CRLP  completed  a $175  million  public  offering  of
unsecured senior notes. The securities, which mature in July 2007, bear a coupon
rate of 7.0%,  and were  priced  to yield an  effective  rate of 7.09%  over the
nine-year term. CRLP used the net proceeds of the offering to repay a portion of
the outstanding balance on its unsecured line of credit.

      Management intends to replace  significant  borrowings that may accumulate
under the bank line of credit with funds  generated  from the sale of additional
limited partnership units to Colonial Properties Trust in connection with public
offerings of securities by the Company,  and/or permanent  financing,  as market
conditions  permit.  Management  believes that these potential sources of funds,
along with the possibility of issuing limited  partnership units in exchange for
properties, will provide CRLP with the means to finance additional acquisitions.
Management anticipates that its net cash provided by operations and its existing
cash balances will provide the necessary  funds on a short- and long-term  basis
to cover its operating expenses,  interest expense on outstanding  indebtedness,
recurring capital expenditures,  distributions to unitholders,  and dividends to
shareholders in accordance with Internal Revenue Code requirements applicable to
real estate investment trusts.

      CRLP is aware of the potential issues  associated with the data conversion
and  system  upgrades  necessary  for  its  computer  systems  to be  year  2000
compliant. CRLP currently believes that, with modifications to existing software
at the corporate level and upgrading  operational systems at the property level,
the year 2000 issue will not have a material  impact on the  operations of CRLP.
At the current time,  CRLP has not determined  the cost that will  ultimately be
incurred to be year 2000 compliant.







                                    Page 13
<PAGE>
                     COLONIAL REALTY LIMITED PARTNERSHIP
                         PART II -- OTHER INFORMATION



Item 2.     Changes in Securities.

      The Company from time to time issues common shares of beneficial  interest
("Common Shares") pursuant to its Dividend Reinvestment and Share Purchase Plan,
its Non-Employee Trustee Share Option Plan, its Non-Employee Trustee Share Plan,
and its Employee Share Option and Restricted  Share Plan, in  transactions  that
are  registered  under the  Securities  Act of 1933,  as  amended  (the  "Act").
Pursuant to CRLP's Second Amended and Restated Agreement of Limited Partnership,
each time the Company issues Common Shares pursuant to the foregoing plans, CRLP
issues to Colonial  Properties  Holding Company,  Inc., its general partner,  an
equal  number of Units for the same price at which the Common  Shares were sold,
in  transactions  that are not  registered  under the Act in reliance on Section
4(2) of the Act.  During the quarter  ended June 30,  1998,  CRLP issued  84,122
Units in such transactions for an aggregate of $2.4 million.

      On May 1,  1998,  CRLP  redeemed a total of 7,222  Units from two  limited
partners,  in  exchange  for an equal  amount  of common  shares  of  beneficial
interest of Colonial Properties Trust.

Item 6.     Exhibits and Reports on Form 8-K.

      (a)  Exhibits

              12.  Ratio of Earnings to Fixed Charges

              15.  Letter re: Unaudited Interim Financial Information

              27.  Financial Data Schedule (EDGAR Version Only)

      (b)  Reports on Form 8-K

            Form 8-K dated June 11, 1998, reported certain property acquisitions
            during 1998 up to June 11, 1998, under Item 5, "Other Events."

            Subsequent  to quarter  end,  Form 8-K dated July 8, 1998,  reported
            certain property  acquisitions during 1998 up to July 8, 1998, under
            Item 5,  "Other  Events,"  and Form 8-K dated July 20,  1998,  filed
            certain  documents  related to CRLP's  debt  offering  under Item 5,
            "Other Events."











                                    Page 14
<PAGE>

                                  SIGNATURES


      Pursuant to the  requirements of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  amendment  to be signed on its behalf by the
undersigned hereunto duly authorized.


                                    COLONIAL REALTY LIMITED PARTNERSHIP,
                                           a Delaware limited partnership

                                 By: Colonial Properties Holding Company, Inc.,
                                             its general partner




Date:  August 12, 1998              By:  /s/ Howard B. Nelson, Jr.
                                         -------------------------
                                         Howard B. Nelson, Jr.
                                         Chief Financial Officer
                                         (Duly Authorized Officer
                                         and Principal Financial Officer)



Date:  August 12, 1998                   /s/ Kenneth E. Howell
                                         ---------------------
                                         Kenneth E. Howell
                                         Vice President and Controller of
                                         Colonial Properties Holding Company,
                                         Inc.
                                         (Principal Accounting Officer)

















                                    Page 15
<PAGE>
                     COLONIAL REALTY LIMITED PARTNERSHIP
               EXHIBIT 12 - Ratio of Earnings to Fixed Charges



      CRLP's ratio of earnings to fixed  charges for the three months ended June
30, 1998 and 1997, was 2.16 and 1.99, respectively.  CRLP's ratio of earnings to
fixed  charges  for the six months  ended June 30,  1998 and 1997,  was 2.06 and
2.01, respectively.

      The ratios of earnings to fixed charges were computed by dividing earnings
by fixed  charges.  For this purpose,  earnings  consist of income (loss) before
gains from sales of property and extraordinary  items plus fixed charges.  Fixed
charges  consist of interest  expense  (including  interest costs  capitalized),
distributions  to preferred  unitholders,  and the amortization of debt issuance
costs.





















                                    Page 16
<PAGE>




Securities and Exchange Commission
450 Fifth Street, N. W.
Washington, D. C. 20549



                                         Re: Colonial Realty Limited Partnership
                                            (File No. 0-20707)
                                             Registration on Form S-3


We are aware  that our  report  dated  July 17,  1998 on our  review of  interim
financial information of Colonial Realty Limited Partnership for the three-month
and  six-month  periods  ended  June  30,  1998 and  1997  and  included  in the
Partnership's  quarterly  report on Form 10-Q for the  periods  then  ended,  is
incorporated by reference in the  registration  statement on Form S-3 related to
the Shelf Registration filed on December 11, 1997 (File No. 333-42049). Pursuant
to Rule 436(c)  under the  Securities  Act of 1933,  this  report  should not be
considered  a part of the  registration  statement  prepared or  certified by us
within the meaning of Sections 7 and 11 of that Act.




                                                /s/ PricewaterhouseCoopers LLP
                                             PRICEWATERHOUSECOOPERS LLP

Birmingham, Alabama
August 12, 1998
















                                    Page 17