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:                 Commission File Number: 0-20707
September 30, 2002


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



         Delaware                                           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
                     September 30, 2002 and December 31, 2001               3

                     Consolidated Condensed Statements of Income for the
                     Three Months and Nine Months Ended
                     September 30, 2002 and 2001                            4

                     Consolidated Condensed Statements of Cash Flows
                     for the Nine Months Ended September 30, 2002 and 2001  5

                     Notes to Consolidated Condensed Financial Statements   6

                     Report of Independent Accountants                     13

         Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                      14

         Item 3.  Quantitative and Qualitative Disclosures about
                  Market Risk                                              22

         Item 4. Controls and Procedures                                   23

PART II:  OTHER INFORMATION


         Item 2.  Changes in Securities                                    24

         Item 6.  Exhibits and Reports on Form 8-K                         24

SIGNATURES                                                                 25

EXHIBITS                                                                   26



<PAGE>

<TABLE>
<CAPTION>

                       COLONIAL REALTY LIMITED PARTNERSHIP
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                 (in thousands)
                              --------------------


                                                           September 30,
                                                               2002        December 31,
                                                            (Unaudited)       2001
                                                            -----------   ------------
                    ASSETS

<S>                                                         <C>            <C>
Land, buildings, & equipment, net                           $ 1,907,207    $ 1,756,255
Undeveloped land and construction in progress                   135,983        152,084
Cash and equivalents                                              1,822         10,127
Restricted cash                                                   1,535          2,255
Accounts receivable, net                                         11,664         12,309
Prepaid expenses                                                  5,270          7,072
Notes receivable                                                  1,140         12,253
Deferred debt and lease costs, net                               21,418         18,568
Investment in unconsolidated subsidiaries                        34,864         31,594
Other assets                                                     15,135         11,866
                                                            -----------    -----------
                                                            $ 2,136,038    $ 2,014,383
                                                            ===========    ===========

      LIABILITIES AND PARTNERS' CAPITAL

Notes and mortgages payable                                 $ 1,260,791    $ 1,191,791
Accounts payable                                                 15,493         20,701
Accrued interest                                                 13,249         11,485
Accrued expenses                                                 20,309          4,520
Tenant deposits                                                   3,368          3,607
Unearned rent                                                     2,432          8,343
Other liabilities                                                 4,267          1,296
                                                            -----------    -----------
     Total liabilities                                        1,319,909      1,241,743
                                                            -----------    -----------

Redeemable units, at redemption value                           394,447        347,604
Preferred units:
     Series A Preferred Units                                   125,000        125,000
     Series B Preferred Units                                   100,000        100,000
     Series C Preferred Units                                    50,000         50,000
Partners' capital                                               149,802        151,439
Accumulated other comprehensive loss                             (3,120)        (1,403)
                                                            -----------    -----------
      Total partners' capital                                   421,682        425,036
                                                            -----------    -----------
                                                            $ 2,136,038    $ 2,014,383
                                                            ===========    ===========


<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>

<PAGE>

<TABLE>
<CAPTION>


                       COLONIAL REALTY LIMITED PARTNERSHIP
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                   (Unaudited)
                      (in thousands, except per unit data)
                              ---------------------



                                                   Three Months Ended        Nine Months Ended
                                                      September 30,             September 30,
                                                 ----------------------    ----------------------
                                                    2002        2001          2002         2001
                                                 ---------    ---------    ---------    ---------
Revenue:
<S>                                              <C>          <C>          <C>          <C>
  Minimum rent                                   $  64,780    $  62,065    $ 189,564    $ 186,517
  Percentage rent                                      584          837        1,725        1,480
  Tenant recoveries                                 10,359        9,421       30,789       27,597
  Other property related revenue                     4,845        5,239       13,779       13,653
  Other non-property related revenue                 1,555          909        5,125        1,282
                                                 ---------    ---------    ---------    ---------
Total revenue                                       82,123       78,471      240,982      230,529
                                                 ---------    ---------    ---------    ---------

Operating Expenses:
 Property operating expenses:
  General operating expenses                         5,908        5,591       16,464       15,903
  Salaries and benefits                              3,867        3,846       11,574       11,765
  Repairs and maintenance                            8,407        7,799       23,460       21,621
  Taxes, licenses, and insurance                     6,368        6,611       21,474       19,339
  General and administrative                         3,445        2,574       11,938        7,702
  Depreciation                                      18,460       16,438       53,568       48,014
  Amortization                                       2,186        2,018        6,298        5,621
                                                 ---------    ---------    ---------    ---------
Total operating expenses                            48,641       44,877      144,776      129,965
                                                 ---------    ---------    ---------    ---------
Income from operations                              33,482       33,594       96,206      100,564
                                                 ---------    ---------    ---------    ---------

Other income (expense):
  Interest expense                                 (16,820)     (17,438)     (47,805)     (55,881)
  Income from investments                              585          327          986          959
  Ineffectiveness of hedging activities                 (4)           9          (12)         (20)
  Gains from sales of property                         615        7,480       32,727        7,334
  Other                                               --           (115)        --           (115)
                                                 ---------    ---------    ---------    ---------
Total other expense                                (15,624)      (9,737)     (14,104)     (47,723)
                                                 ---------    ---------    ---------    ---------
Income from continuing operations                   17,858       23,857       82,102       52,841
                                                 ---------    ---------    ---------    ---------

Income from discontinued operations                     55          118          451          429
Gain on disposal of discontinued operations          6,069         --          6,069         --
                                                 ---------    ---------    ---------    ---------
Income from discontinued operations                  6,124          118        6,520          429
                                                 ---------    ---------    ---------    ---------
Net income                                          23,982       23,975       88,622       53,270
                                                 ---------    ---------    ---------    ---------
Dividends to preferred unitholders                  (6,109)      (6,109)     (18,329)     (16,157)
                                                 ---------    ---------    ---------    ---------
Net income available to common unitholders       $  17,873    $  17,866    $  70,293    $  37,113
                                                 ---------    ---------    ---------    ---------


Net income per common unit - Basic:
        Income from continuing operations        $    0.36    $    0.56    $    1.93    $    1.15
        Income from discontinued operations           0.18         0.00         0.20         0.01
                                                 ---------    ---------    ---------    ---------
        Net income per common unit - Basic       $    0.54    $    0.56    $    2.13    $    1.16
                                                 ---------    ---------    ---------    ---------

Net income per common unit - Diluted:
        Income from continuing operations        $    0.35    $    0.56    $    1.91    $    1.14
        Income from discontinued operations           0.18         0.00         0.20         0.01
                                                 ---------    ---------    ---------    ---------
        Net income per common unit - Diluted     $    0.53    $    0.56    $    2.11    $    1.15
                                                 ---------    ---------    ---------    ---------

Average units outstanding:
        Basic                                       33,426       31,994       33,043       31,983
        Diluted                                     33,709       32,139       33,312       32,085


<FN>
The accompanying notes are an integral part of these financial statements.
</FN>

</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                       COLONIAL REALTY LIMITED PARTNERSHIP
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)
                               -------------------

                                                                      Nine Months Ended
                                                                        September 30,
                                                                  -----------------------
                                                                     2002         2001
                                                                  ----------   ----------

Cash flows from operating activities:
<S>                                                               <C>          <C>
     Net  income                                                  $  88,622    $  53,270
     Adjustments to reconcile net income to net cash provided
        by operating activities:
        Depreciation and amortization                                60,198       54,032
        Income from unconsolidated subsidiaries                        (986)        (946)
        Gains from sales of property                                (38,796)      (7,334)
        Other                                                         1,043        1,495
     Decrease (increase) in:
        Restricted cash                                                 720         (265)
        Accounts receivable                                            (358)      (3,386)
        Prepaid expenses                                              2,203          439
        Other assets                                                 (8,698)      (4,207)
     Increase (decrease) in:
        Accounts payable                                             (5,208)       2,146
        Accrued interest                                              1,764       (1,410)
        Accrued expenses and other                                    7,750       13,045
                                                                  ---------    ---------
            Net cash provided by operating activities               108,254      106,879
                                                                  ---------    ---------

Cash flows from investing activities:
     Acquisition of properties                                     (150,808)         -0-
     Development expenditures                                       (39,908)    (106,242)
     Tenant improvements                                            (17,487)     (14,375)
     Capital expenditures                                           (10,158)     (10,209)
     Proceeds from notes receivable                                  11,113        9,818
     Proceeds from sales of property, net of selling costs          113,628       41,852
     Distributions from unconsolidated subsidiaries                   2,499        2,020
     Capital contributions to unconsolidated subsidiaries            (4,783)      (2,015)
                                                                  ---------    ---------
            Net cash used in investing activities                   (95,904)     (79,151)
                                                                  ---------    ---------

Cash flows from financing activities:
     Principal reductions of debt                                   (71,866)     (71,052)
     Proceeds from additional borrowings                            151,285       38,988
     Net change in revolving credit balances                        (55,773)      33,385
     Cash contributions from the issuance of preferred units            -0-       48,125
     Cash contributions                                              40,103          425
     Capital distributions                                          (83,519)     (76,598)
     Payment of mortgage financing cost                                (885)      (1,504)
     Other, net                                                         -0-         (344)
                                                                  ---------    ---------
            Net cash provided by (used in) financing activities     (20,655)     (28,575)
                                                                  ---------    ---------
            Increase (decrease) in cash and equivalents              (8,305)        (847)
Cash and equivalents, beginning of period                            10,127        4,275
                                                                  ---------    ---------
Cash and equivalents, end of period                               $   1,822    $   3,428
                                                                  =========    =========


<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>

<PAGE>

                       COLONIAL REALTY LIMITED PARTNERSHIP
                              NOTES TO CONSOLIDATED
                         CONDENSED FINANCIAL STATEMENTS
                               September 30, 2002
                                   (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.  Accordingly, they do not
include all of the  information  and  footnotes  required by generally  accepted
accounting  principles  for  complete  financial  statements.  In the opinion of
management,  all adjustments  considered  necessary for a fair presentation have
been  included.  The results of operations  for the three and nine month periods
ended September 30, 2002 are not necessarily  indicative of the results that may
be expected  for the full year.  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,  2001,  and with the  information  filed with the  Securities  and  Exchange
Commission on Form 10-Q for the quarters ended March 31, 2002 and June 30, 2002.
The  December  31, 2001  balance  sheet data  presented  herein was derived from
audited  financial  statements but does not include all disclosures  required by
generally  accepted  accounting  principles.  Certain  2001  amounts  have  been
reclassified to conform to the current year's financial statement presentation.

         Effective   January  1,  2002  CRLP  adopted   Statement  of  Financial
Accounting  Standard ("SFAS") No. 144, Accounting for the Impairment or Disposal
of Long-Lived Assets.  SFAS 144 provides  additional  guidance on the accounting
for  impairments  of long-lived  assets and updates the accounting and reporting
requirements for discontinued  operations.  In accordance with the provisions of
SFAS 144, CRLP records  individual  property sales as  discontinued  operations,
unless CRLP maintains  significant  continuing  involvement with properties that
have been sold.  During the third quarter of 2002, CRLP had three property sales
that were required to be classified as discontinued  operations.  See Note 3 for
further discussion.

         In April 2002, FASB issued SFAS 145,  Rescission of FASB Statements No.
4, 44, and 64,  Amendment of FASB  Statement No. 13, and Technical  Corrections.
SFAS  145   rescinds   SFAS  4,  which   required  all  gains  and  losses  from
extinguishment  of debt to be  aggregated  and, if  material,  classified  as an
extraordinary  item, net of related income tax effect. As a result, the criteria
in Accounting  Principles  Board Opinion 30, will now be used to classify  those
gains and losses.  SFAS 64 amended  SFAS 4, and is no longer  necessary  because
SFAS 4 has been rescinded.  SFAS 44 and the amended  sections of SFAS 13 are not
applicable to CRLP and therefore have no effect on CRLP's financial  statements.
SFAS 145 is effective for fiscal years  beginning  after May 15, 2002 with early
application encouraged. The adoption of SFAS 145 will likely not have a material
effect  on CRLP as the  gains  and  losses  on the  extinguishment  of debt  are
generally not material to CRLP's financial statements.




<PAGE>



Note 2 -- Capital Structure

         At September 30, 2002, the Company  controlled CRLP as the sole general
partner  and as the  holder of 67.4% of the  common  units of CRLP  ("Redeemable
Units") and 63.6% of the  preferred  units (the  "Series A Preferred  Units" and
"Series C Preferred  Units).  The limited  partners of CRLP who hold units,  are
those persons (including certain officers and directors) who, at the time of the
Initial Public  Offering,  elected to hold all or a portion of their interest in
the form of Units rather than  receiving  shares of common stock of the Company,
or individuals from whom the Company acquired certain properties, who elected to
receive Units in exchange for the  properties.  Each Unit may be redeemed by the
holder  thereof  for either one share of Common  Stock or cash equal to the fair
market  value  thereof  at the time of such  redemption,  at the option of CRLP.
Additionally,  in  1999,  CRLP  issued  $100  million  of  Series  B  Cumulative
Redeemable  Perpetual Preferred Units ("Series B Units") in a private placement,
that are  exchangeable  for Series B Preferred  Shares of the Company  after ten
years at the option of the holders of the Series B Units.

         The Board of Trustees  of the Company  manages  CRLP by  directing  the
affairs of the Company.  The Company's  interests in CRLP entitle it to share in
cash distributions from, and in the profits and losses of, CRLP in proportion to
the Company's percentage interest therein and entitle the Company to vote on all
matters requiring a vote of the limited partners.

Note 3 --Acquisitions and Dispositions

         Acquisitions

         Effective August 1, 2002, CRLP acquired Heathrow International Business
Center, a  seven-building  office park totaling 804,078 rentable square feet and
102  acres  of land  for  potential  future  development,  located  in the  Lake
Mary/Heathrow  submarket of Orlando,  Florida.  Current tenants include national
and regional  companies like Veritas,  Bank One,  FiServ,  and The United States
Government.  The total  purchase  price of the office  park was $122.0  million,
which was primarily funded through CRLP's recent sales of multifamily and retail
assets and the  assumption  of $44.0  million of existing  debt.  The  remaining
balance was funded through CRLP's unsecured line of credit.  Additionally,  CRLP
has agreed to acquire one new office building that contains 192,000 square feet.
The  closing  for this  acquisition  will  occur  upon the  earlier of the third
anniversary  of the  date of the  agreement  or at such  time  that  the  seller
achieves  certain leasing  targets for the property.  The purchase price will be
determined  based on the percentage of gross  leasable area actually  leased and
the net operating income generated by the leases at the time of acquisition.

         Additionally, during July 2002, CRLP acquired three single family homes
located in Montgomery,  Alabama for a total purchase price of approximately $0.5
million,  which will be operated as rental property. The homes were purchased as
part of a "corporate  rental  program" for an  automobile  manufacturer  that is
building a manufacturing  plant near  Montgomery,  Alabama.  Under the corporate
rental program,  executives of the automobile  manufacturer  will rent the homes
from CRLP for an  initial  term of three  years,  with the  option to extend the
lease,  and have agreed to have other  employees  lease  additional  multifamily
units at Colonial Grand at Promenade located in Montgomery,  Alabama.  The homes
were  purchased  from Lowder New Homes,  Inc.,  a related  party and were funded
through CRLP's unsecured line of credit.




<PAGE>
         Dispositions

         On July 11, 2002, CRLP sold University Park Plaza, an office asset, and
Colonial  Promenade  University Park, Phase II, a retail asset,  both located in
Orlando,  Florida.  University  Park Plaza  consists of three  office  buildings
totaling 72,500 square feet and Colonial  Promenade  University  Park,  Phase II
contains  183,450  square feet. The total sales price for these assets was $16.7
million,  resulting  in a net  gain of  $5.7  million,  which  was  recorded  as
discontinued  operations,  in  accordance  with  SFAS  144.  Additionally,  CRLP
recorded  the  operations  of these  properties  for all  periods  presented  as
discontinued  operations,  in  accordance  with SFAS 144. The proceeds  from the
sales were used to acquire  Heathrow  International  Business Center in Orlando,
Florida, as noted above.

         On September 9, 2002,  CRLP sold two office  buildings  totaling 32,000
square feet located in Birmingham, Alabama, within the Colonnade office complex.
The total sales price for these  buildings was $3.7 million,  resulting in a net
gain  of $0.4  million,  which  was  recorded  as  discontinued  operations,  in
accordance  with SFAS 144.  Additionally,  CRLP recorded the operations of these
buildings for all periods  presented as discontinued  operations,  in accordance
with SFAS 144.  The  proceeds  from the sale were used to repay a portion of the
borrowings under CRLP's unsecured line of credit.

Note 4 -- Debt Financing

         On July 31, 2002,  CRLP completed a $100.0 million public debt offering
of unsecured senior notes.  The notes,  which mature in July 2012, bear a coupon
rate of 6.88%,  and were  priced to yield an  effective  rate of 6.99%  over the
ten-year  term.  CRLP used the net  proceeds  of the  offering  to repay a $57.5
million medium-term note that matured on August 9, 2002 and the remaining amount
was used to pay down a portion of the outstanding  balance on its unsecured line
of credit.

Note 5 -- Orlando Fashion Square

         In October 1998, CRLP sold a 50% interest in our Orlando Fashion Square
retail property located in Orlando, Florida to a third party. Subsequently,  the
Company  entered into a joint venture  agreement  with the third party,  and the
joint  venture  entered  into an  agreement  with the  Company  relating  to the
management of the property.  The joint venture  agreement  gives the third party
the right, which became effective December 28, 2001, to convert its 50% interest
in the property to the Company's common shares if specified terms and conditions
are met. The conversion value of the interest would be determined at the time of
conversion  in  accordance  with the  procedures  set forth in the joint venture
agreement,  and  would  be  net of the  third  party's  pro  rata  share  of any
indebtedness  secured by the property.  The terms and conditions also include an
"accretion  threshold",  as  defined,  which  must  be met.  At the  time of the
original  transaction,  CRLP  considered  the  terms of the  agreement  in their
entirety  (including  the conversion  right,  the accretion  threshold,  and the
conversion value determination  procedures) and assessed whether the third party
could compel CRLP to repurchase the 50% interest  sold.  CRLP concluded that the
likelihood of a compelled  repurchase was remote, and accordingly  accounted for
the transaction as a sale.

         On May 31, 2002, the 50% joint venture  partner elected to exercise its
option to convert its 50%  interest  in the  property  to the  Company's  common
shares.  In  accordance  with  the  terms of the  joint  venture  agreement,  we
negotiated with our joint venture partner and were unable to reach an agreement.
Therefore,  on September 11, 2002, the joint venture partner elected to withdraw
its conversion election.




<PAGE>



Note 6 -- Net Income Per Unit
         The following table sets forth the computation of basic and diluted
earnings per unit:
<TABLE>
<CAPTION>

(amounts in thousands, except
per unit data)
                                                                Three        Three         Nine         Nine
                                                                Months       Months       Months       Months
                                                                Ended        Ended        Ended        Ended
                                                               Sept. 30,    Sept. 30,    Sept. 30,    Sept. 30,
                                                                 2002         2001         2002         2001
                                                              -----------  -----------  -----------  -----------
       Numerator:
<S>                                                         <C>          <C>          <C>          <C>
            Net Income                                      $     23,982 $     23,975 $     88,622 $     53,270
         Less: Preferred stock dividends                          (6,109)      (6,109)     (18,329)     (16,157)
                                                              -----------  -----------  -----------  -----------
            Income available to common unitholders          $     17,873 $     17,866 $     70,293 $     37,113
                                                              -----------  -----------  -----------  -----------

       Denominator:
         Denominator  for  basic net  income  per unit -
         weighted average common units                            33,426       31,994       33,043       31,983
         Effect of dilutive securities:
         Trustee and employee  stock  options,  treasury
         method                                                      283          145          269          102
                                                              -----------  -----------  -----------  -----------
         Denominator  for  diluted net income per unit -
         adjusted weighted average common units                   33,709       32,139       33,312       32,085
                                                              -----------  -----------  -----------  -----------

         Basic net income per unit                          $       0.54 $       0.56 $       2.13 $       1.16
         Diluted net income per unit                        $       0.53 $       0.56 $       2.11 $       1.15
                                                              -----------  -----------  -----------  -----------
</TABLE>

         Options to purchase 40,000 common shares at a weighted average exercise
price of $35.57 per share were outstanding during 2002, but were not included in
the  computation  of diluted net income per share because the options'  exercise
price was  greater  than the  average  market  price of the common  shares  and,
therefore, the effect would be antidilutive.

Note 7 -- Segment Information

         CRLP  is  organized  into,  and  manages  its  business  based  on  the
performance of three  separate and distinct  operating  divisions:  Multifamily,
Retail,  and  Office.  Each  division  has a  separate  management  team that is
responsible for acquiring,  developing,  managing, and leasing properties within
each  division.   The  applicable   accounting  policies  of  the  segments  are
substantially  the  same as  those  described  in the  "Summary  of  Significant
Accounting Policies" in CRLP's 2001 Annual Report. However, the pro rata portion
of the revenues, net operating income ("NOI"), and assets of the partially owned
entities  and joint  ventures  that CRLP has  entered  into are  included in the
applicable  segment  information.  Subsequently,  in the reconciliation to total
revenues,  total NOI,  and total  assets,  the  amounts are  eliminated,  as the
investment in the partially  owned  entities and joint ventures are reflected in
the  consolidated  financial  statements as investments  accounted for under the
equity method.

         Management  evaluates  the  performance  of its segments and  allocates
resources  to them based on NOI.  NOI  consists of revenues in excess of general
operating  expenses,  salaries  and  wages,  repairs  and  maintenance,   taxes,
licenses, and insurance. Segment information for the three and nine months ended
September 30, 2002 and 2001, and total  divisional  assets to total assets as of
September 30, 2002 and December 31, 2001 is as follows:
<TABLE>
<CAPTION>

                                                           Three Months Ended                   Nine Months Ended
                                                              September 30,                       September 30,
                                                  ------------------------------------    ----------------------------
       (in thousands)                                  2002                2001               2002           2001
                                                  ----------------    ----------------    -------------   ------------
Revenues:
       Divisional Revenues
<S>                                                      <C>                 <C>              <C>            <C>
           Multifamily                                   $ 24,876            $ 30,337         $ 79,685       $ 90,140
           Office                                          21,140              14,738           52,975         42,610
           Retail                                          37,354              36,428          112,500        107,176
                                                  ----------------    ----------------    -------------   ------------
                Total Divisional Revenues:                 83,370              81,503          245,160        239,926

       Partially-owned subsidiaries                        (3,539)             (3,149)          (9,695)        (9,712)
       Unallocated corporate revenues                       2,470                 564            6,779          1,728
       Discontinued operations revenues                      (178)               (447)          (1,262)        (1,413)
                                                  ----------------    ----------------    -------------   ------------
                Total Consolidated Revenues:             $ 82,123            $ 78,471        $ 240,982       $230,529
                                                  ----------------    ----------------    -------------   ------------

NOI:
       Divisional NOI
           Multifamily                                   $ 16,349            $ 19,976         $ 52,287       $ 60,494
           Office                                          15,433              10,564           37,591         30,400
           Retail                                          25,586              25,588           77,538         75,832
                                                  ----------------    ----------------    -------------   ------------
                Total Divisional NOI:                      57,368              56,128          167,416        166,726

       Partially-owned subsidiaries                        (2,140)             (1,886)          (5,543)        (5,741)
       Unallocated corporate revenues                       2,470                 564            6,779          1,728
       Discontinued operations NOI                            (55)               (118)            (451)          (429)
       General and administrative expenses                 (3,445)             (2,574)         (11,938)        (7,702)
       Depreciation                                       (18,514)            (16,561)         (53,879)       (48,385)
       Amortization                                        (2,189)             (2,026)          (6,319)        (5,647)
       Other                                                  (13)                 67              141             14
                                                  ----------------    ----------------    -------------   ------------
           Income from operations                          33,482              33,594           96,206        100,564
                                                  ----------------    ----------------    -------------   ------------
       Total other expense                                (15,624)             (9,737)         (14,104)       (47,723)
                                                  ----------------    ----------------    -------------   ------------
           Income from continuing operations             $ 17,858            $ 23,857         $ 82,102       $ 52,841
                                                  ----------------    ----------------    -------------   ------------
</TABLE>


<TABLE>
<CAPTION>

       (in thousands)                              September 30,        December 31,
Assets:                                                2002                2001
                                                  ----------------    ----------------
       Divisional Assets
<S>                                                     <C>                 <C>
           Multifamily                                  $ 650,347           $ 723,447
           Office                                         593,296             377,255
           Retail                                         913,120             905,964
                                                  ----------------    ----------------
                Total Divisional Assets:                2,156,763           2,006,666

       Partially-owned subsidiaries                      (118,010)           (106,191)
       Unallocated corporate assets (1)                    97,285             113,908
                                                  ----------------    ----------------
                                                      $ 2,136,038         $ 2,014,383
                                                  ----------------    ----------------

<FN>
(1)      Includes the CRLP's investment in  partially-owned  entities of $34,864
         as of September 30, 2002, and $31,594 as of December 31, 2001.
</FN>
</TABLE>



Note 8 -- Derivative Instruments

         In the  normal  course of  business,  CRLP is  exposed to the effect of
interest rate  changes.  CRLP limits these risks by following  established  risk
management  policies  and  procedures  including  the  use of  derivatives.  For
interest rate exposures,  derivatives are used primarily to align rate movements
between interest rates associated with CRLP's leasing income and other financial
assets with  interest  rates on related  debt,  and manage the cost of borrowing
obligations.

         CRLP does not use  derivatives  for  trading or  speculative  purposes.
Further,  CRLP has a policy of only entering into contracts with major financial
institutions  based upon their credit ratings and other factors.  When viewed in
conjunction with the underlying and offsetting exposure that the derivatives are
designed to hedge, CRLP has not sustained a material loss from those instruments
nor  does it  anticipate  any  material  adverse  effect  on its net  income  or
financial position in the future from the use of derivatives.

         CRLP has entered  into several  different  hedging  transactions  in an
effort to manage  exposure to changes in interest  rates.  The  following  table
summarizes the notional values, fair values and other  characteristics of CRLP's
derivative  financial  instruments  at September 30, 2002. The notional value at
September 30, 2002 provides an indication of the extent of CRLP's involvement in
these instruments at that time, but does not represent total exposure to credit,
interest rate, or market risk.
<TABLE>
<CAPTION>

                                                                   Interest                       Fair Value
Product Type                               Notional Value          Rate          Maturity       (in thousands)
------------------------------------------ ----------------------- ------------- ------------ -------------------
<S>                                        <C>                    <C>           <C>                  <C>
1) Interest Rate SWAP, Cash Flow           $30.2-$27.7 million     5.932%        1/01/06              $  (3,096)
2) Interest Rate SWAP, Cash Flow           $75.0 million           2.130%        12/10/02                   (71)
3) Interest Rate SWAP, Cash Flow           $50.0 million           2.319%        1/01/03                    (98)
4) Interest Rate SWAP, Cash Flow           $25.0 million           2.430%        1/01/03                    (58)
5) Interest Rate SWAP, Fair Value          $50.0 million           5.015%        7/26/04                   3,111
6) Interest Rate CAP, Cash Flow            $21.1 million           6.850%        6/29/04                       5
7) Interest Rate CAP, Cash Flow            $17.9 million           6.850%        7/06/04                       5
8) Interest Rate CAP, Cash Flow            $30.4 million           11.200%       6/30/03                       0
9) Interest Rate CAPS, Cash Flow           $53.0 million           4.840%        4/01/04                      20
</TABLE>

         On September  30, 2002,  the  derivative  instruments  were reported at
their fair value as Other Assets of $3.1 million and Other  Liabilities  of $3.3
million.  For the quarter and the year-to-date,  adjustments of $0.9 million and
$1.7 million were recorded,  respectively,  as unrealized  losses in accumulated
other  comprehensive  income  (loss),  and there was an adjustment to fixed rate
debt of $0.9 million during the third quarter 2002. Additionally,  CRLP recorded
a $4,000 loss in earnings due to some ineffectiveness on the caps and one of the
swaps.  The  ineffectiveness  resulted from a timing  difference  regarding rate
reset  dates  on the swap  and  minor  differences  in the cap and  hedged  debt
notional amounts.

         Most of CRLP's  hedges are  designated  as cash flow hedges.  Cash flow
hedges  protect  against the  variability  in future cash outflows of current or
forecasted  debt.  Interest rate swaps that convert  variable  payments to fixed
payments are cash flow hedges. The changes in the fair value of these hedges are
reported  on  the  balance  sheet  with a  corresponding  adjustment  to  either
accumulated other comprehensive income (loss) or in  earnings--depending  on the
type of hedging relationship. Over time, the unrealized gains and losses held in
accumulated other comprehensive  income (loss) will be reclassified to earnings.
This reclassification  occurs in the same period or periods that the hedged cash
flows affect earnings. Within the next twelve months, CRLP expects to reclassify
to  earnings   approximately  $1.5  million  of  the  current  balance  held  in
accumulated other comprehensive income (loss) to earnings as interest expense.

         CRLP hedges its  exposure to the  variability  in future cash flows for
forecasted  transactions  over  a  maximum  period  of  12  months.  During  the
forecasted period, unrealized gains and losses in the hedging instrument will be
reported in  accumulated  other  comprehensive  income  (loss).  Once the hedged
transaction takes place, the hedge gains and losses will be reported in earnings
during the same period in which the hedged item is recognized in earnings.

Note 9 -- Comprehensive Income (Loss)

         Comprehensive income (loss) consisted of the following:
<TABLE>
<CAPTION>

  (in thousands)                                                   Three Months ended          Nine Months ended
                                                                   September 30, 2002         September 30, 2002
                                                                -------------------------- --------------------------

<S>                                                                     <C>                        <C>
  Net income                                                            $ 23,982                   $ 88,622
  Other comprehensive income (loss)
       Unrealized income (loss) on cash flow
              hedging activities                                            (939)                    (1,717)
                                                                -------------------------- --------------------------
  Comprehensive income                                                  $ 23,043                   $ 86,905
                                                                -------------------------- --------------------------
</TABLE>

         Accumulated other comprehensive income (loss) consisted of the
following:
<TABLE>
<CAPTION>

          (in thousands)                                                 Accumulated Other
                                                                    Comprehensive Income (Loss)
                                                                -------------------------------------

<S>                           <C> <C>                                        <C>
          Balance at December 31, 2001                                       $ (1,403)
          Current period change in fair value of
                  derivative instruments                                       (1,717)
                                                                -------------------------------------
          Balance at September 30, 2002                                      $ (3,120)
                                                                -------------------------------------
</TABLE>

Note 10 -- Subsequent Events

         Derivative Instruments

         During  October  2002,  CRLP  entered  into  three  interest  rate swap
agreements,  one with  Wells  Fargo  Bank and two with PNC Bank,  in which  CRLP
effectively fixed $150.0 million of its floating rate debt at an average rate of
1.79% plus the spread on the  LIBOR-indexed  floating  rate debt.  The swaps are
effective January 2, 2003 and will mature on January 2, 2004.

         Distribution

         On October 24,  2002, a cash  distribution  was declared to partners of
CRLP in the amount of $0.66 per unit,  totaling $22.1 million.  The distribution
was  declared to  partners  of record as of  November  4, 2002,  and was paid on
November 11, 2002.



<PAGE>


REPORT OF INDEPENDENT ACCOUNTANTS



To the Board of Trustees of
Colonial Properties Trust:

         We have reviewed the accompanying  consolidated condensed balance sheet
of Colonial Realty Limited  Partnership (the  "Partnership") as of September 30,
2002,  and the  related  consolidated  condensed  statements  of income  for the
three-month  and nine-month  periods ended  September 30, 2002 and 2001, and the
consolidated condensed statements of cash flows for the nine-month periods ended
September 30, 2002 and 2001. 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 auditing  standards  generally  accepted in the United States of
America,  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  consolidated  condensed  financial
statements for them to be in conformity  with  accounting  principles  generally
accepted in the United States of America.

         We have  previously  audited,  in accordance  with  auditing  standards
generally  accepted in the United States of America,  the  consolidated  balance
sheet as of December  31,  2001,  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 18, 2002, except for Note 16,
as to which the date is February 25, 2002, 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,  2001,  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
October 24, 2002

<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,   office
buildings, retail malls and shopping centers. The Company is organized as a real
estate  investment trust (REIT) and owns and operates  properties in nine states
in the Sunbelt  region of the United  States.  As of September 30, 2002,  CRLP's
real  estate  portfolio  consisted  of 41  multifamily  communities,  21  office
properties, and 44 retail properties.

         CRLP is one of the  largest  diversified  REITs in the  United  States.
Consistent with its  diversified  strategy,  Colonial  manages its business with
three  separate and  distinct  operating  divisions:  Multifamily,  Office,  and
Retail.  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.
Constant  communication  among the Executive  Vice  Presidents  and  centralized
functions   of   accounting,   information   technology,   due   diligence   and
administrative  services  provide CRLP with unique synergy allowing CRLP to take
advantage of a variety of investment opportunities. Decisions for investments in
acquisitions and developments and for dispositions are also centralized.

         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 2001 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.



<PAGE>



Results of Operations -- Three Months Ended September 30, 2002 and 2001

         Revenue -- Total revenue  increased by $3.7 million,  or 4.7%,  for the
third quarter of 2002 when  compared to the third quarter of 2001.  The majority
of this  increase,  $3.6 million  represents  revenues  generated by  properties
acquired or developed  during 2002 and the second half of 2001,  net of revenues
from properties  disposed of in 2002 and 2001. The remaining  increase primarily
relates to  increases in rental rates at existing  properties,  other  ancillary
income, and third party management fee income.

         Same-property revenue decreased by $1.1 million, or 1.6%, for the third
quarter of 2002 when  compared to the third  quarter of 2001.  This  decrease is
primarily  related to an  increase  in move-in  concessions  in our  multifamily
properties  during the third  quarter  of 2002 as a result of a slowdown  in the
U.S.  economy  during  the  last  year,  and a  decrease  in  overall  occupancy
percentages  within all of our divisions,  offset by lease buyouts that occurred
in our office division in the third quarter of 2002.

         Operating  Expenses  --  Total  operating  expenses  increased  by $3.8
million,  or 8.4%,  for the third  quarter  of 2002 when  compared  to the third
quarter of 2001.  Of this  increase,  $1.9  million is related to the  operating
expenses of properties  acquired or developed during 2002 and the second half of
2001,  net of expenses from  properties  disposed of in 2002 and 2001,  and $1.1
million is related to the consolidation of CPSI effective September 1, 2001. The
remaining  increase is associated with increases in general  operating  expenses
and repairs and maintenance expenses.

         Same-property  operating expenses  increased by $0.5 million,  or 2.4%,
for the third quarter of 2002 when  compared to the third  quarter of 2001.  The
increase is primarily  associated with increases in general operating  expenses,
utilities expenses, and repairs and maintenance expenses.

         Other Income and Expense -- Interest expense decreased by $0.6 million,
or 3.5%,  for the third  quarter of 2002 when  compared to the third  quarter of
2001. The decrease in interest expense is primarily attributable to the decrease
in the interest  rate  environment  in the third quarter 2002 as compared to the
third quarter 2001.  Overall,  CRLP's weighted  average  interest rate decreased
from 6.56% at September 30, 2001 to 6.02% at September  30, 2002,  and notes and
mortgages  payable  increased to $1.26  billion at September 30, 2002 from $1.18
billion at September 30, 2001. Additionally, gains (losses) on sales of property
decreased  $6.9 million in the third  quarter of 2002 when compared to the third
quarter of 2001. See Liquidity and Capital Resources for further discussion.

Results of Operations -- Nine Months Ended September 30, 2002 and 2001

         Revenue -- Total revenue  increased by $10.5 million,  or 4.5%, for the
nine months  ended  September  30, 2002 when  compared to the nine months  ended
September 30, 2001. Of this increase, $4.0 million represents revenues generated
by properties acquired or developed during 2002 and the second half of 2001, net
of  properties  disposed of in 2002 and 2001,  and $1.8  million  relates to the
consolidation  of CPSI  effective  September  1, 2001.  The  remaining  increase
primarily  relates to increases in rental  rates at existing  properties,  other
ancillary  income,  lease buyouts  within our office  division,  and third party
management fee income.

         Same-property  revenue increased by $1.9 million, or 0.9%, for the nine
months ended September 30, 2002 when compared to the nine months ended September
30, 2001. This increase is primarily related to the increase in rental rates and
specialty  leasing  income  in our  retail  operating  properties,  offset by an
increase in move-in concessions and vacancy losses in our multifamily properties
during the nine months ended September 30, 2002 as a result of a slowdown in the
U.S. economy during the last year.

         Operating  Expenses  -- Total  operating  expenses  increased  by $14.8
million, or 11.4%, for the nine months ended September 30, 2002 when compared to
the nine months ended  September  30, 2001.  Of this  increase,  $2.1 million is
related to increases in real estate taxes, licenses, and insurance, $3.4 million
is related to the  consolidation  of CPSI effective  September 1, 2001, and $2.7
million is related to depreciation and  amortization  expense on newly developed
or acquired  properties,  net of  properties  disposed of in 2002 and 2001.  The
remaining  increase primarily relates to increases in general operating expenses
and repairs and maintenance at existing properties.

         Same-property  operating expenses  increased by $4.3 million,  or 7.2%,
for the nine months ended  September  30, 2002 when  compared to the nine months
ended  September  30,  2001.  Of the  increase,  $2.6  million is related to the
increase  in real  estate  taxes  and  insurance  in our  current  markets.  The
remaining  increase is associated with increases in general operating  expenses,
utilities expenses, and repairs and maintenance expenses.

         Other Income and Expense -- Interest expense decreased by $8.1 million,
or 14.5%, for the nine months ended September 30, 2002 when compared to the nine
months ended  September 30, 2001. The decrease in interest  expense is primarily
attributable to the decrease in the interest rate  environment in the first nine
months of 2002 as  compared to the first nine  months of 2001.  Overall,  CRLP's
weighted  average  interest rate  decreased  from 6.56% at September 30, 2001 to
6.02% at September 30, 2002, and notes and mortgages  payable increased to $1.26
billion at September 30, 2002 from $1.18  billion at September  30, 2001.  Gains
(losses) on sales of property  increased $25.4 million for the nine months ended
September  30, 2002 when  compared to the nine months ended  September 30, 2001,
which is  attributable  to the sales of  approximately  $114.9 million of assets
during the nine months ended  September  30, 2002,  as compared to $40.6 million
during the nine months ended  September  30,  2001.  See  Liquidity  and Capital
Resources for further discussion.

Summary of Critical Accounting Policies

         Management of CRLP considers the following accounting policies to be
critical to the reported operating results of CRLP:

         Real Estate Development
         CRLP capitalizes all costs, including interest,  real estate taxes that
are associated with the development, construction, expansion, or leasing of real
estate investments as a cost of the property.  All other expenditures  necessary
to maintain a property in ordinary operating condition are expensed as incurred.

         CRLP evaluates its properties, at least annually or upon the occurrence
of  significant  changes in the  operations,  to assess  whether any  impairment
indications are present,  including  recurring  operating losses and significant
adverse  changes  in legal  factors  or  business  environment  that  affect the
recovery of the recorded value. If any property is considered  impaired,  a loss
will be provided to reduce the carrying  value of the property to its  estimated
fair value.  The valuation of real estate  investments  involves many subjective
assumptions dependent upon future economic events that affect the ultimate value
of the property.

         Valuation of Receivables
         CRLP is subject to tenant  defaults and  bankruptcies at our Office and
Retail  properties that could affect the collection of outstanding  receivables.
In order to mitigate  these risks,  CRLP performs  credit review and analysis on
all commercial  tenants and  significant  leases before they are executed.  CRLP
evaluates the  collectibility of outstanding  receivables and records allowances
as appropriate.

Other Arrangements

         In September 2001,  CRLP entered into an agreement to provide  services
to an unrelated third party in connection with the third party's  development of
a $30.0 million multi-family property in North Carolina. Colonial was engaged to
serve as  development  consultant  and  leasing  and  management  agent for this
property.  In  addition,  for a fee,  CRLP is serving as a guarantor  for a $3.3
million working capital loan obtained by the three principals of the third party
entity,  which loan is  primarily  collateralized  jointly and  severally by the
personal  assets of the borrowers,  and matures in August 2003. CRLP has a right
of first refusal to purchase the property  should the third party elect to sell.
Over  the  term of the  agreement,  CRLP  expects  to earn  market  fees for its
services.

         During  January 2000,  CRLP  initiated and completed an Executive  Unit
Purchase  Program (Unit  Purchase  Program),  in which the Board of Trustees and
certain members of the Company's management were able to purchase 425,925 Units.
Under the Unit  Purchase  Program,  the Board of  Trustees  and the  members  of
management  obtained  full-recourse  personal loans from an unrelated  financial
institution, in order to purchase the Units. The Units are pledged as collateral
against the loans.  In addition,  CRLP has provided a guarantee to the unrelated
financial  institution for the personal loans, which mature in January 2005. The
value of the Units purchased under the Unit Purchase  Program was  approximately
$10.0 million.

Liquidity and Capital Resources

         During the third quarter of 2002,  CRLP invested  $140.4 million in the
acquisition  and  development of  properties.  CRLP financed this growth through
advances on its bank line of credit, cash from operations,  proceeds from CRLP's
dividend  reinvestment  plan,  disposition  of assets,  and financing of certain
properties.  As of September 30, 2002, CRLP had an unsecured bank line of credit
providing for total borrowings of $300 million.  The line, which is used by CRLP
primarily to finance property  acquisitions  and development,  bears interest at
LIBOR plus 115 basis  points,  which  matures in April 2003,  and provides for a
two-year  amortization in the case of non-renewal.  The line of credit agreement
includes a  competitive  bid feature  that will allow CRLP to convert up to $150
million under the line of credit to a fixed rate, for a fixed term not to exceed
90 days. The balance  outstanding on this line at September 30, 2002, was $205.5
million.

         At September 30, 2002,  CRLP's total outstanding debt balance was $1.26
billion.  The outstanding  balance includes fixed-rate debt of $1.01 billion, or
80.6% of the total debt balance,  and floating-rate  debt of $244.9 million,  or
19.4% of the total  debt  balance.  CRLP's  total  market  capitalization  as of
September   30,  2002  was  $2.7  billion  and  its  ratio  of  debt  to  market
capitalization  was 45.9%.  Certain loan agreements of CRLP contain  restrictive
covenants,  which among other things require  maintenance  of various  financial
ratios. At September 30, 2002, CRLP was in compliance with these covenants.

         CRLP continued its asset recycling  program,  which allows CRLP to sell
mature,  slower growing assets and reinvest the proceeds into opportunities with
more growth  potential.  During the third quarter of 2002,  CRLP sold University
Park Plaza, an office asset, and Colonial Promenade University Park, Phase II, a
retail asset, both located in Orlando,  Florida.  University Park Plaza consists
of three office  buildings  totaling  72,500 square feet and Colonial  Promenade
University  Park,  Phase II contains  183,450 square feet. The total sales price
for these assets was $16.7 million. Additionally, CRLP sold two office buildings
totaling 32,000 square feet located in Birmingham, Alabama, within the Colonnade
office complex. The total sales price for these buildings was $3.7 million.

         The proceeds from the sales were used to acquire Heathrow International
Business  Center in Orlando,  Florida,  a  seven-building  office park  totaling
804,078  rentable  square  feet  and 102  acres  of land  for  potential  future
development,  located in the Lake Mary/Heathrow  submarket of Orlando,  Florida.
Current tenants include national and regional companies like Veritas,  Bank One,
FiServ, and The United States Government. The total purchase price of the office
park was $122.0 million,  which was primarily funded through CRLP's recent sales
of multifamily and retail assets and the assumption of $44.0 million of existing
debt. The remaining  balance was funded through CRLP's unsecured line of credit.
Additionally,  CRLP has agreed to acquire one new office  building that contains
192,000  square  feet.  The  closing  for this  acquisition  will occur upon the
earlier of the third  anniversary  of the date of the  agreement or at such time
that the seller achieves certain leasing targets for the property.  The purchase
price will be determined based on the percentage of gross leasable area actually
leased  and the net  operating  income  generated  by the  leases at the time of
acquisition.

         Through its taxable REIT  subsidiary,  CPSI,  CRLP provides  management
services  for  properties  owned by third  parties,  and  provides  construction
management and development services for third parties, for which CRLP recognizes
management and development fees. Additionally, CRLP makes the following types of
investments  through CPSI; (a) purchases  undeveloped  land and sells parcels of
land to third parties,  (b) develops a property,  and upon completion  sells the
property to a third party, or (c) purchases an operating  property to be sold to
a third party within a short period of time.

         CRLP expects to meet its short-term  liquidity  requirements  generally
through  its net cash  provided by  operations,  proceeds  from CRLP's  dividend
reinvestment plan, and borrowings under credit  arrangements and expects to meet
certain  of  its  long-term  liquidity  requirements,  such  as  scheduled  debt
maturities,  repayment of financing of construction and development  activities,
and possible  property  acquisitions,  through  long-term  secured and unsecured
borrowings and the issuance of debt securities or additional  equity  securities
of CRLP,  sales of properties,  joint ventures,  or, possibly in connection with
acquisitions  of land or improved  properties,  issuance of limited  partnership
units.  CRLP believes that its net cash provided by operations  will be adequate
and  anticipates  that it will  continue to be  adequate to meet both  operating
requirements and payment of dividends by CRLP both the short and the long term.

Financial Instruments: Derivatives and Hedging

         In the  normal  course of  business,  CRLP is  exposed to the effect of
interest rate  changes.  CRLP limits these risks by following  established  risk
management  policies  and  procedures  including  the  use of  derivatives.  For
interest rate exposures,  derivatives are used primarily to align rate movements
between interest rates associated with CRLP's leasing income and other financial
assets with  interest  rates on related  debt,  and manage the cost of borrowing
obligations.

         CRLP does not use  derivatives  for  trading or  speculative  purposes.
Further,  CRLP has a policy of only entering into contracts with major financial
institutions  based upon their credit ratings and other factors.  When viewed in
conjunction with the underlying and offsetting exposure that the derivatives are
designed to hedge, CRLP has not sustained a material loss from those instruments
nor  does it  anticipate  any  material  adverse  effect  on its net  income  or
financial position in the future from the use of derivatives.

         CRLP has entered  into several  different  hedging  transactions  in an
effort to manage  exposure to changes in interest  rates.  The  following  table
summarizes the notional values, fair values and other  characteristics of CRLP's
derivative  financial  instruments  at September 30, 2002. The notional value at
September 30, 2002 provides an indication of the extent of CRLP's involvement in
these  instruments  at that time,  but does not  represent  exposure  to credit,
interest rate, or market risk.
<TABLE>
<CAPTION>

                                                                   Interest                       Fair Value
Product Type                               Notional Value          Rate          Maturity       (in thousands)
------------------------------------------ ----------------------- ------------- ------------ -------------------
<S>                                        <C>                    <C>           <C>                  <C>
1) Interest Rate SWAP, Cash Flow           $30.2-$27.7 million     5.932%        1/01/06              $  (3,096)
2) Interest Rate SWAP, Cash Flow           $75.0 million           2.130%        12/10/02                   (71)
3) Interest Rate SWAP, Cash Flow           $50.0 million           2.319%        1/01/03                    (98)
4) Interest Rate SWAP, Cash Flow           $25.0 million           2.430%        1/01/03                    (58)
5) Interest Rate SWAP, Fair Value          $50.0 million           5.015%        7/26/04                   3,111
6) Interest Rate CAP, Cash Flow            $21.1 million           6.850%        6/29/04                       5
7) Interest Rate CAP, Cash Flow            $17.9 million           6.850%        7/06/04                       5
8) Interest Rate CAP, Cash Flow            $30.4 million           11.200%       6/30/03                       0
9) Interest Rate CAPS, Cash Flow           $53.0 million           4.840%        4/01/04                      20
</TABLE>

         On September  30, 2002,  the  derivative  instruments  were reported at
their fair value as Other Assets of $3.1 million and Other  Liabilities  of $3.3
million.  For the quarter and the year-to-date,  adjustments of $0.9 million and
$1.7 million were recorded,  respectively,  as unrealized  losses in accumulated
other  comprehensive  income  (loss),  and there was an adjustment to fixed rate
debt of $0.9 million during the third quarter 2002. Additionally,  CRLP recorded
a $4,000 loss in earnings due to some ineffectiveness on the caps and one of the
swaps.  The  ineffectiveness  resulted from a timing  difference  regarding rate
reset  dates  on the swap  and  minor  differences  in the cap and  hedged  debt
notional amounts.

         Most of CRLP's  hedges are  designated  as cash flow hedges.  Cash flow
hedges  protect  against the  variability  in future cash outflows of current or
forecasted  debt.  Interest rate swaps that convert  variable  payments to fixed
payments are cash flow hedges. The changes in the fair value of these hedges are
reported  on  the  balance  sheet  with a  corresponding  adjustment  to  either
accumulated other comprehensive income (loss) or in  earnings--depending  on the
type of hedging relationship. Over time, the unrealized gains and losses held in
accumulated other comprehensive  income (loss) will be reclassified to earnings.
This reclassification  occurs in the same period or periods that the hedged cash
flows affect earnings. Within the next twelve months, CRLP expects to reclassify
to  earnings   approximately  $1.5  million  of  the  current  balance  held  in
accumulated other comprehensive income (loss) to earnings as interest expense.

         CRLP hedges its  exposure to the  variability  in future cash flows for
forecasted  transactions  over  a  maximum  period  of  12  months.  During  the
forecasted period, unrealized gains and losses in the hedging instrument will be
reported in  accumulated  other  comprehensive  income  (loss).  Once the hedged
transaction takes place, the hedge gains and losses will be reported in earnings
during the same period in which the hedged item is recognized in earnings.

Outlook
         Management  intends  to  maintain  CRLP's  strength  through  continued
diversification,   while  pursuing   acquisitions  and  developments  that  meet
Colonial's  criteria for  property  quality,  market  strength,  and  investment
return. Management will continue to use its line of credit to provide short-term
financing for acquisition,  development,  and expansion  activities and plans to
continue to replace  significant  borrowings  under the bank line of credit with
funds generated from the sale of additional  equity  securities of CRLP, sale of
assets,  and  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, developments, and expansions.

         In  addition  to  the  issuance  of  equity  and  debt,  management  is
investigating  alternate  financing methods and sources to raise future capital.
Private  placements,   joint  ventures,  and  non-traditional  equity  and  debt
offerings are some of the alternatives CRLP is contemplating.

         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,  and dividends to shareholders in
accordance  with Internal  Revenue Code  requirements  applicable to real estate
investment trusts.

Inflation

         Leases at the multifamily  properties  generally provide for an initial
term of six  months to one year and allow  for rent  adjustments  at the time of
renewal.  Leases at the office properties typically provide for rent adjustments
and the pass-through of certain operating expenses during the term of the lease.
Substantially  all of the  leases  at the  retail  properties  provide  for  the
pass-through to tenants of certain operating costs, including real estate taxes,
common area maintenance expenses, and insurance.  All of these provisions permit
CRLP to increase  rental rates or other charges to tenants in response to rising
prices and, therefore,  serve to minimize CRLP's exposure to the adverse effects
of inflation.

         An  increase  in general  price  levels  may  immediately  precede,  or
accompany, an increase in interest rates. At September 30, 2002, CRLP's exposure
to rising  interest  rates was  mitigated by the existing debt level of 45.9% of
CRLP's  total  market  capitalization,  the high  percentage  of fixed rate debt
(80.6%), and the use of interest rate swaps to effectively fix the interest rate
on $75.0 million  through  December 2002,  $75.0 million  through  January 2003,
$100.0 million through  December 2003, and  approximately  $30.0 million through
January 2006. As a result,  for the  short-term,  increases in interest  expense
resulting  from  increasing  inflation  is  anticipated  to be less than  future
increases in income before interest.




Item 3.  Quantitative and Qualitative Disclosures about Market Risk

         CRLP is exposed to interest  rate changes  primarily as a result of its
line of credit and  long-term  debt used to maintain  liquidity and fund capital
expenditures  and  expansion  of CRLP's real  estate  investment  portfolio  and
operations.  CRLP's  interest  rate risk  management  objective  is to limit the
impact of  interest  rate  changes on  earnings  and cash flows and to lower its
overall  borrowing costs. To achieve its objectives,  CRLP borrows  primarily at
fixed rates and may enter into derivative financial instruments such as interest
rate swaps,  caps and treasury locks in order to mitigate its interest rate risk
on a  related  financial  instrument.  CRLP does not enter  into  derivative  or
interest rate transactions for speculative purposes.

         The table  below  presents  the  principal  amounts,  weighted  average
interest  rates,  fair  values  and other  terms  required  by year of  expected
maturity to evaluate the expected  cash flows and  sensitivity  to interest rate
changes.  Also  included is a summary of CRLP's swap  contracts and rate caps at
September 30, 2002.

<TABLE>
<CAPTION>

                                                                                                                     Estimated
                                                                                                                        Fair
(amounts in thousands)          2002        2003         2004        2005         2006     Thereafter     Total        Value
---------------------------------------------------------------------------------------------------------------------------------

<S>                                  <C>     <C>           <C>        <C>           <C>        <C>        <C>          <C>
Fixed Rate Debt                      $ -     252,951       65,866     109,384       75,000     512,737    1,015,938    1,027,146
Average interest rate
     at September 30, 2002             -       4.79%        7.70%       7.55%        7.97%       7.26%        6.76%            -

Variable Debt                        $ -      55,974       50,000           -            -     138,879      244,853      244,853
Average interest rate
     at September 30, 2002             -       2.97%        3.82%           -            -       2.73%        3.01%            -

Interest Rate SWAPs

     Variable to fixed               $ -     150,000            -           -       29,447           -      179,447       (3,323)
     Average pay rate                  -       2.24%            -           -        6.59%           -        2.95%            -

     Fixed to variable               $ -           -       50,000           -            -           -       50,000        3,111
     Average pay rate                  -           -        5.02%           -            -           -        5.02%            -

Interest Rate Cap                    $ -      30,379       90,819           -            -           -      121,198           31
    Interest Rate                      -      11.20%        5.69%           -            -           -        7.07%            -

</TABLE>



         The table  incorporates only those exposures that exist as of September
30, 2002 and it does not consider those  exposures or positions that could arise
after that date.  Moreover,  because firm  commitments  are not presented in the
table above, the information  presented therein has limited predictive value. As
a result,  CRLP's  ultimate  realized gain or loss with respect to interest rate
fluctuations  will depend on the exposures that arise during the period,  CRLP's
hedging strategies at that time, and interest rates.

Item 4.  Controls and Procedures.

         Within 90 days prior to the date of filing of this report, CRLP carried
out an evaluation,  under the supervision and with the  participation  of CRLP's
management and support from the Company's external auditors, including the Chief
Executive Officer and the Chief Financial  Officer,  of the design and operation
of CRLP's disclosure controls and procedures.  Based on this evaluation,  CRLP's
Chief  Executive  Officer  and Chief  Financial  Officer  concluded  that CRLP's
disclosure  controls and procedures  are effective for gathering,  analyzing and
disclosing the information  CRLP is required to disclose in the reports it files
under the Securities  Exchange Act of 1934, within the time periods specified in
the Securities  and Exchange  Commission's  rules and forms.  There have been no
significant  changes in CRLP's internal  controls or in other factors that could
significantly   affect  internal  controls   subsequent  to  the  date  of  this
evaluation.


<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 Third Amended and Restated Agreement of Limited
Partnership,  each  time  the  Company  issues  Common  Shares  pursuant  to the
foregoing plans, CRLP issues to Colonial  Properties Trust, 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  September  30,  2002,  CRLP
issued 144,360 Units in such transactions for an aggregate of approximately $4.8
million.

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


        (b)   Reports on Form 8-K

              On July 31, 2002, a Form 8-K was filed, which reported a $100.0
              million public debt offering of unsecured senior notes, under Item
              5, "Other Events".


<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 Trust,
                                           its general partner




Date:  November 14, 2002             By:    /s/ Howard B. Nelson, Jr.
                                            ---------------------------
                                                Howard B. Nelson, Jr.
                                                Chief Financial Officer
                                               (Duly Authorized Officer
                                                and Principal Financial Officer)



Date:  November 14, 2002                    /s/ Kenneth E. Howell
                                            ---------------------------
                                                Kenneth E. Howell
                                                Senior Vice President and
                                                Chief Accounting Officer
                                               (Principal Accounting Officer)