SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C.  20549


                               FORM 10-Q


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



For the quarter ended 
September 30, 1998                    Commission file number 0-10494  



             CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI
        (Exact name of registrant as specified in its charter)




                Illinois                    36-3102608                
      (State of organization)      (IRS Employer Identification No.)  




  900 N. Michigan Ave., Chicago, IL           60611                   
(Address of principal executive office)      (Zip Code)               




Registrant's telephone number, including area code 312/915-1987




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>


                           TABLE OF CONTENTS




PART I     FINANCIAL INFORMATION


Item 1.    Financial Statements . . . . . . . . . . . . . .      3

Item 2.    Management's Discussion and 
           Analysis of Financial Condition and 
           Results of Operations. . . . . . . . . . . . . .     13



PART II    OTHER INFORMATION


Item 3.    Defaults upon Senior Securities. . . . . . . . .     16

Item 5.    Other Information. . . . . . . . . . . . . . . .     17

Item 6.    Exhibits and Reports on Form 8-K . . . . . . . .     18






<PAGE>


<TABLE>
PART I.  FINANCIAL INFORMATION
     ITEM 1.  FINANCIAL STATEMENTS
                               CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES

                                        CONSOLIDATED BALANCE SHEETS
                                 SEPTEMBER 30, 1998 AND DECEMBER 31, 1997
                                                (UNAUDITED)

                                                  ASSETS
                                                  ------
<CAPTION>
                                                                          SEPTEMBER 30,    DECEMBER 31,
                                                                              1998            1997     
                                                                          -------------    ----------- 
<S>                                                                      <C>              <C>          
Current assets:
  Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . .      $  3,339,981     13,840,535 
  Rents and other receivables (net of allowance for 
    doubtful accounts of $193,048 and $281,456 at 
    September 30, 1998 and December 31, 1997, respectively) . . . . .           210,735        561,151 
  Escrow deposits and restricted funds. . . . . . . . . . . . . . . .         5,219,265      3,055,577 
  Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . .           196,957        139,508 
                                                                           ------------    ----------- 
          Total current assets. . . . . . . . . . . . . . . . . . . .         8,966,938     17,596,771 
                                                                           ------------    ----------- 
Mortgage notes receivable (net of reserve for 
 uncollectibility of $327,774). . . . . . . . . . . . . . . . . . . .         1,867,695      1,867,695 
                                                                           ------------    ----------- 
    Properties held for sale or disposition . . . . . . . . . . . . .        53,394,344     52,350,885 
                                                                           ------------    ----------- 
        Total investment properties . . . . . . . . . . . . . . . . .        53,394,344     52,350,885 
                                                                           ------------    ----------- 
Investment in unconsolidated venture, at equity . . . . . . . . . . .            38,194      4,018,588 
Deferred expenses . . . . . . . . . . . . . . . . . . . . . . . . . .         1,962,185      1,859,513 
Accrued rents receivable. . . . . . . . . . . . . . . . . . . . . . .           157,545        227,374 
Venture partner's deficit in venture. . . . . . . . . . . . . . . . .         1,204,947      1,000,714 
                                                                           ------------    ----------- 
                                                                           $ 67,591,848     78,921,540 
                                                                           ============    =========== 


<PAGE>


                               CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES
                                        CONSOLIDATED BALANCE SHEETS
                           LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
                           -----------------------------------------------------
                                                                          SEPTEMBER 30,    DECEMBER 31,
                                                                              1998            1997     
                                                                          -------------    ----------- 
Current liabilities:
  Current portion of long-term debt . . . . . . . . . . . . . . . . .      $ 44,676,002     44,676,002 
  Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . .         1,883,183      1,883,723 
  Unearned rents. . . . . . . . . . . . . . . . . . . . . . . . . . .           351,612        433,712 
  Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . .         3,301,311      1,174,074 
  Accrued real estate taxes . . . . . . . . . . . . . . . . . . . . .           634,348        712,576 
                                                                           ------------    ----------- 
        Total current liabilities . . . . . . . . . . . . . . . . . .        50,846,456     48,880,087 
Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . .           131,890        180,488 
Long-term debt, less current portion. . . . . . . . . . . . . . . . .        48,281,927     46,713,811 
Deferred revenue. . . . . . . . . . . . . . . . . . . . . . . . . . .           140,470        167,466 
                                                                           ------------    ----------- 
Commitments and contingencies

        Total liabilities . . . . . . . . . . . . . . . . . . . . . .        99,400,743     95,941,852 
                                                                           ------------    ----------- 
Deferred gain on sale of investment property. . . . . . . . . . . . .         1,867,695      1,867,695 
                                                                           ------------    ----------- 
Partners' capital accounts (deficits):
  General partners:
    Capital contributions . . . . . . . . . . . . . . . . . . . . . .             1,000          1,000 
    Cumulative net earnings (losses). . . . . . . . . . . . . . . . .       (13,422,402)   (13,408,309)
    Cumulative cash distributions . . . . . . . . . . . . . . . . . .        (1,123,608)    (1,116,446)
                                                                           ------------    ----------- 
                                                                            (14,545,010)   (14,523,755)
                                                                           ------------    ----------- 
  Limited partners:
    Capital contributions, net of offering costs. . . . . . . . . . .       121,935,233    121,935,233 
    Cumulative net earnings (losses). . . . . . . . . . . . . . . . .       (81,569,738)   (81,231,510)
    Cumulative cash distributions . . . . . . . . . . . . . . . . . .       (59,497,075)   (45,067,975)
                                                                           ------------    ----------- 
                                                                            (19,131,580)    (4,364,252)
                                                                           ------------    ----------- 
        Total partners' capital accounts (deficits) . . . . . . . . .       (33,676,590)   (18,888,007)
                                                                           ------------    ----------- 
                                                                           $ 67,591,848     78,921,540 
                                                                           ============    =========== 


<FN>
                       See accompanying notes to consolidated financial statements.
</TABLE>


<PAGE>


<TABLE>
                               CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES

                                   CONSOLIDATED STATEMENTS OF OPERATIONS

                          THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
                                                (UNAUDITED)

<CAPTION>
                                                     THREE MONTHS ENDED           NINE MONTHS ENDED     
                                                       SEPTEMBER 30                 SEPTEMBER 30        
                                                 --------------------------  -------------------------- 
                                                      1998          1997          1998          1997    
                                                  -----------    ----------   -----------    ---------- 
<S>                                              <C>            <C>          <C>            <C>         
Income:
  Rental income . . . . . . . . . . . . . . . .  $  4,495,417     6,233,896    13,679,335    20,175,954 
  Interest income . . . . . . . . . . . . . . .        72,431        74,172       339,680       446,345 
                                                 ------------   -----------   -----------   ----------- 
                                                    4,567,848     6,308,068    14,019,015    20,622,299 
                                                 ------------   -----------   -----------   ----------- 
Expenses:
  Mortgage and other interest . . . . . . . . .     2,277,345     3,309,606     6,832,515     9,839,106 
  Depreciation. . . . . . . . . . . . . . . . .         --            --            --        1,009,322 
  Property operating expenses . . . . . . . . .     2,081,717     3,969,973     6,812,438    11,445,025 
  Professional services . . . . . . . . . . . .        27,571         3,936       270,355       176,385 
  Amortization of deferred expenses . . . . . .       123,197       256,614       363,601       749,897 
  General and administrative. . . . . . . . . .        69,778        89,295       296,660       335,783 
  Provision for value impairment. . . . . . . .         --            --            --       13,143,000 
                                                 ------------   -----------   -----------   ----------- 
                                                    4,579,608     7,629,424    14,575,569    36,698,518 
                                                 ------------   -----------   -----------   ----------- 
                                                      (11,760)   (1,321,356)     (556,554)  (16,076,219)
Partnership's share of operations of 
  unconsolidated venture  . . . . . . . . . . .          (663)      117,154        37,543       413,589 
Venture partner's share of ventures' 
  operations. . . . . . . . . . . . . . . . . .        27,327       152,345       204,233       381,166 
                                                 ------------   -----------   -----------   ----------- 
        Net earnings (loss) . . . . . . . . . .  $     14,904    (1,051,857)     (314,778)  (15,281,464)
                                                 ============   ===========   ===========   =========== 
        Net earnings (loss) per limited 
          partnership interest. . . . . . . . .  $        .10         (7.34)        (2.20)      (106.75)
                                                 ============   ===========   ===========   =========== 
        Cash distributions per limited 
          partnership interest. . . . . . . . .  $      --            --           105.00         --    
                                                 ============   ===========   ===========   =========== 
<FN>
                       See accompanying notes to consolidated financial statements.
</TABLE>


<PAGE>


<TABLE>
                               CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES

                                   CONSOLIDATED STATEMENTS OF CASH FLOWS

                               NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997

                                                (UNAUDITED)

<CAPTION>
                                                                                1998            1997    
                                                                            ------------    ----------- 
<S>                                                                        <C>             <C>          
Cash flows from operating activities:
  Net earnings (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . .  $  (314,778)   (15,281,464)
  Items not requiring (providing) cash or cash equivalents:
    Depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        --         1,009,322 
    Amortization of deferred expenses . . . . . . . . . . . . . . . . . . .      363,601        749,897 
    Long-term debt - deferred accrued interest. . . . . . . . . . . . . . .    1,568,116      1,686,680 
    Partnership's share of operations of unconsolidated venture . . . . . .      (37,543)      (413,589)
    Venture partner's share of venture's operations . . . . . . . . . . . .     (204,233)      (381,166)
    Provision for value impairment. . . . . . . . . . . . . . . . . . . . .        --        13,143,000 
  Changes in:
    Rents and other receivables . . . . . . . . . . . . . . . . . . . . . .      350,416        162,124 
    Escrow deposits and restricted funds. . . . . . . . . . . . . . . . . .   (2,163,688)      (991,513)
    Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . .      (57,449)       398,132 
    Accrued rents receivable. . . . . . . . . . . . . . . . . . . . . . . .       69,829        878,282 
    Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . .         (540)       221,468 
    Unearned rents. . . . . . . . . . . . . . . . . . . . . . . . . . . . .      (82,100)         3,300 
    Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . .    2,127,237      1,388,780 
    Accrued real estate taxes . . . . . . . . . . . . . . . . . . . . . . .      (78,228)       (42,791)
    Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . . .      (48,598)       (27,189)
    Deferred revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . .      (26,996)       (24,680)
                                                                            ------------    ----------- 
        Net cash provided by (used in) operating activities . . . . . . . .    1,465,046      2,478,593 
                                                                            ------------    ----------- 
Cash flows from investing activities:
  Additions to investment properties. . . . . . . . . . . . . . . . . . . .   (1,043,459)    (1,385,716)
  Payment of deferred expenses. . . . . . . . . . . . . . . . . . . . . . .     (466,273)      (782,152)
  Proceeds from sale of investment property . . . . . . . . . . . . . . . .    3,980,394          --    
                                                                            ------------    ----------- 
        Net cash provided by (used in) investing activities . . . . . . . .    2,470,662     (2,167,868)
                                                                            ------------    ----------- 



<PAGE>


                               CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI
                                          (A LIMITED PARTNERSHIP)
                                         AND CONSOLIDATED VENTURES


                             CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)



                                                                                1998            1997    
                                                                            ------------    ----------- 
Cash flows from financing activities:
  Principal payments on long-term debt. . . . . . . . . . . . . . . . . . .        --          (295,406)
  Distributions to limited partners . . . . . . . . . . . . . . . . . . . .  (14,429,100)         --    
  Distributions to general partners . . . . . . . . . . . . . . . . . . . .       (7,162)         --    
                                                                            ------------    ----------- 
          Net cash provided by (used in) financing activities . . . . . . .  (14,436,262)      (295,406)
                                                                            ------------    ----------- 
          Net increase (decrease) in cash and
            cash equivalents. . . . . . . . . . . . . . . . . . . . . . . .  (10,500,554)        15,319 

          Cash and cash equivalents, beginning of year. . . . . . . . . . .   13,840,535      3,697,163 
                                                                            ------------    ----------- 

          Cash and cash equivalents, end of period. . . . . . . . . . . . . $  3,339,981      3,712,482 
                                                                            ============    =========== 

Supplemental disclosure of cash flow information:
  Cash paid for mortgage and other interest . . . . . . . . . . . . . . . . $  3,137,162      6,763,646 
                                                                            ============    =========== 
  Non-cash investing and financing activities . . . . . . . . . . . . . . . $      --             --    
                                                                            ============    =========== 
















<FN>
                       See accompanying notes to consolidated financial statements.
</TABLE>


<PAGE>


             CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI
                        (A LIMITED PARTNERSHIP)
                       AND CONSOLIDATED VENTURES

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                      SEPTEMBER 30, 1998 AND 1997

                              (UNAUDITED)

GENERAL

     Readers of this quarterly report should refer to the Partnership's
audited financial statements for the year ended December 31, 1997, which
are included in the Partnership's 1997 Annual Report, as certain footnote
disclosures which would substantially duplicate those contained in such
audited financial statements have been omitted from this report.

     The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those
estimates.

     The Partnership adopted Statement of Financial Accounting Standards
No. 121 ("SFAS 121") "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of" as required in the first
quarter of 1996.  The Partnership's policy is to consider a property to be
held for sale or disposition when the Partnership has committed to a plan
to sell or dispose of such property and active marketing activity has
commenced or is expected to commence in the near term or the Partnership
has concluded that it may dispose of the property by no longer funding
operating deficits or debt service requirements of the property thus
allowing the lender to realize upon its security.  In accordance with SFAS
121, any properties identified as "held for sale or disposition" are no
longer depreciated.  As of September 30, 1998, the Partnership and its
consolidated ventures have or have previously committed to plans to sell or
dispose of all their remaining investment properties.  Accordingly, all
consolidated properties have been classified as held for sale or
disposition in the accompanying consolidated financial statements as of the
respective date of such plan's adoption.  The results of operations, net of
venture partner's share, for the nine months ended September 30, 1998 and
1997 for these properties and for properties sold or disposed of in the
past two years were $253,500 and ($18,392,903), respectively.  In addition,
the accompanying consolidated financial statements include $37,543 and
$413,589, respectively, of the Partnership's share of total property
operations of $273,527 and $3,013,278 for its unconsolidated property for
the nine months ended September 30, 1998 and 1997, respectively, which was
sold in December 1997.

     Certain amounts in the 1997 Consolidated Financial Statements have
been reclassified in order to conform with the 1998 presentation.

TRANSACTIONS WITH AFFILIATES

     The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Corporate General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investments.  Fees, commissions and other
expenses required to be paid by the Partnership to the General Partners and
their affiliates as of September 30, 1998 and for the nine months ended
September 30, 1998 and 1997 were as follows:


<PAGE>



                                                         Unpaid at   
                                                       September 30, 
                                   1998        1997        1998      
                                 --------    -------    -------------
Property management 
 and leasing fees . . . . . .    $170,350    204,085         --      
Insurance commissions . . . .      32,674     24,915         --      
Reimbursement (at cost)
 for out-of-pocket salary 
 and salary-related expenses
 related to the on-site
 and other costs for the 
 Partnership and its
 investment properties. . . .      49,415     38,187        21,017   
                                 --------    -------        ------   
                                 $252,439    267,187        21,017   
                                 ========    =======        ======   

     The Corporate General Partner had deferred payment of partnership
management fees of $11,936.  In addition, distributions to the General
Partners of the first quarter 1991 net cash flow of the Partnership
aggregating $7,161 had been deferred.  The General Partners and their
affiliates had also deferred payment of the Partnership's share of property
management and leasing fees of approximately $171,000 for the Partnership's
unconsolidated venture.  These amounts, which did not bear interest, were
paid during the quarter ended March 31, 1998.

RIVERFRONT OFFICE BUILDING

     The Cambridge, Massachusetts market, in which the property operates,
has been improving and as a result, the Partnership has recently been
successful in attracting new tenants to the property.  At September 30,
1998, the property was 97% occupied.  As of the date of this report, the
property is 100% leased.  However, if future operating shortfalls are
greater than expected and funding of deficits becomes necessary, the
Partnership would make a decision whether or not to commit additional funds
to this investment property based on, among other things, the likelihood of
the return of such additional investment plus a reasonable profit thereon. 
The amount of liquidity this investment property can provide to the
Partnership is dependent on the property's value and the satisfaction of
certain preference levels to the unaffiliated venture partner pursuant to
the joint venture agreement.

     The restructured loan secured by the building and improvements
provides for participating interest whereby the lender is entitled to earn
a minimum internal rate of return ranging from 9% to 10.5% per annum
calculated over the restructured loan term and a Residual Amount (as
defined) of approximately 50% of the proceeds from a sale of the property
in excess of such minimum internal rate of return.  During the quarter, the
Partnership has continued its discussions with the lender and other
stakeholders in the property concerning, in essence, a possible reduction
of the lender's residual amount, a restructuring of the joint venture
agreement, and purchase of the ground lease to which the property is
subject.  There is no assurance that any such provisions will be agreed to.

     The restructured loan requires that net cash flow after debt service
and capital be paid into an escrow account controlled by the lender to be
used for future operating shortfalls, principal payments and costs
associated with additional leasing as approved by the lender.  In this
regard, in July 1997, $451,409 of escrowed funds was applied by the lender
against the outstanding mortgage loan balance and, in October 1997,
$615,271 of escrowed funds was released by the lender to cover leasing
costs and other capital projects at the property.  The agreement further
prohibits the venture owning the property from distributing excess cash
flow after full funding of the escrow accounts.  Such excess funds are to
be retained and utilized for operating shortfalls, principal payments and
costs associated with additional leasing as approved by the lender prior to
withdrawing escrow deposits.


<PAGE>


     In addition, as a condition of the loan restructure discussed above,
the ground lease was amended and provides for the deferral of any and all
ground lease payments from February 1993 until the earlier of any future
mortgage loan prepayment date (resulting from a sale or refinancing of the
property) or December 31, 2007.  However, if the property produces certain
levels of gross receipts (as defined by the restructured loan) for the
years 1998 through 2003, the restructured loan allows for partial payments
of ground rent to be reinstated beginning in 1998.  Based on current
projections, the venture does not expect ground rent payments to resume in
1998.  The ground lessor is a general partner of the venture partner.  At
September 30, 1998, the total amount of deferred and accrued ground lease
expense is approximately $973,000.

     The joint venture is currently marketing the property for sale.  There
can be no assurance that the property will be sold in 1998 or that a sale
will be finalized.

MALL OF MEMPHIS

     Occupancy at the property was 79% at September 30, 1998.  The mall has
experienced a number of store closings, many prior to lease expiration,
primarily as a result of tenants filing for bankruptcy and liquidating.  In
addition, the property has been subjected to increased competition for
shoppers and tenants from strip centers and large discount stores in its
market area.  Although certain tenants continue to perform well, overall
tenant sales at the property have continued to decline.  Due to poor sales
performances, many tenants are electing not to renew their leases or are
renewing at lower rates.  Several other tenants whose leases are not due to
expire in the near term have approached the Partnership seeking rent
relief.  The Partnership has granted rent relief to certain tenants that
could demonstrate that without a reduction in their rent, they would no
longer be able to remain in business at the mall.  As a result of these
market and property conditions, the property's cash flow has been
decreasing and is expected to decline further in the future.  As of the
date of this report, property occupancy has decreased to 75%.

     The Partnership initiated discussions with the underlying lender
regarding a loan modification and, in connection with these discussions,
advanced approximately $604,000 to cover the property's required debt
service payments through December 31, 1997.  However, the lender was
unwilling to grant an acceptable loan modification to cover future
operating deficits.  The Partnership has therefore decided not to commit
any additional amounts to the property and, effective January 1, 1998,
suspended the payment of required debt service on its first, second and
third mortgage notes secured by the property.  At September 30, 1998, these
notes had an aggregate principal balance of $39,676,002 and accrued but
unpaid interest of approximately $2,339,000.  As a result, the Partnership
is in default and these mortgage notes have been classified as current in
the accompanying consolidated financial statements.  The lender agreed to
allow the Partnership to recoup its 1997 advance from 1998 operating cash
flow before proceeding to realize on its security in the property.  As of
the date of this report, the Partnership has recouped its 1997 advance and
has remitted $1,072,378 to the lender representing property cash flow for
the six months ended June 30, 1998.  Such cash flow payment was net of
repayment of the Partnership's 1997 advance and estimated future property
operating deficits related to real estate tax obligations.  Accordingly, as
of June 30, 1998, the Partnership has classified all property cash as
restricted.  The Partnership expects the lender to proceed to realize on
its security during the fourth quarter of 1998 or the first quarter of
1999.  This will result in the Partnership no longer having an ownership
interest in the property and will result in a gain for financial reporting
and Federal income tax purposes with no corresponding distributable
proceeds in 1998 or 1999.



<PAGE>


     Pursuant to the terms of a note payable by the Partnership to the
former venture partner, the Partnership guaranteed a portion of the debt
service payment payable on June 1, 1997 in the amount of $300,000 on a
recourse basis.  As of the date of this report, the Partnership has not
made the debt service payment, including such guaranteed amount.  As a
result, the Partnership is in default and the $5,000,000 note payable has
been classified as current in the accompanying consolidated financial
statements.  Due to provisions of the associated underlying agreements, the
former venture partner may generally only realize upon its security (its
former partnership interest in the joint venture) in the event of default
by the Partnership.  However, concerning such June 1997 payment, it is
possible that the former venture partner may attempt to exercise its
remedies against the Partnership's other assets respecting the guaranteed
amount.

     The current and anticipated market conditions outlined above caused
uncertainty regarding the Partnership's ability to recover the net carrying
value of the Mall of Memphis investment property through future operations
and sale.  Therefore, as of June 30, 1997, the Partnership recorded, as a
matter of prudent accounting practice, a provision for value impairment of
such investment of $13,143,000.  Such provision was recorded to reflect the
then estimated fair value of the property, less costs to sell.

NATIONAL CITY CENTER

     On December 18, 1997, the venture sold the National City Center Office
Building.  As the Partnership had committed to a plan to sell the property,
the property was classified as held for sale or disposition as of
December 31, 1996 and therefore was no longer subject to continued
depreciation.  The sale price of the land and improvements was $82,150,000.

Cash proceeds, after selling costs and the $54,277,977 mortgage assumed by
the purchaser, were $26,371,722 of which the Partnership's share was
$3,619,652.  As a result of the sale, the Partnership recognized a gain of
$2,960,265 for financial reporting purposes and a gain of $7,764,780 for
Federal income tax purposes in 1997.  In connection with the sale of this
property and as is customary in such transactions, the venture agreed to
certain representations, warranties and covenants with a stipulated
survival period which expires December 17, 1998.  Although it is not
expected, the venture and the Partnership may ultimately have some
liability under such representations, warranties and covenants which are
limited to actual damages and shall in no event exceed $2,000,000 in
aggregate of which the Partnership's share is approximately $275,000.

YERBA BUENA OFFICE BUILDING

     Due to the default of the joint venture that owned the Yerba Buena
Office Building (a partnership comprised of the Partnership, two other
partnerships sponsored by the Partnership's Corporate General Partner, and
four unaffiliated limited partners) in the payment of required debt
service, the former lender to such joint venture realized on its security
by taking title to the property in June 1992.  In return for a smooth
transition of title and management of the property (relative to which the
existing property manager that was affiliated with the Partnership's
Corporate General Partner agreed to continue to manage the property), the
joint venture was able to negotiate, among other things, a right of first
opportunity to purchase the property during the time frame from June 1995
through May 1998 should the lender wish to market the property for sale. 
The lender sold the property in 1996.  However, the joint venture was not
given an opportunity to purchase the property as required by the previous
settlement with the lender.  As previously reported, such joint venture
filed a lawsuit against the lender for breach of its obligations.  In June
1998, the court granted the lender's motion for summary judgement and
dismissed the lawsuit. In dismissing the action, the court apparently
relied upon a release given by the management company (an affiliate of the
Partnership's Corporate General Partner) relative to the settlement of its


<PAGE>


claims against the lender and the termination of its management contract
for the property.  Such settlement was the result of claims made by the
management company in a separate lawsuit, due to the non-payment of
management fees.  Though the intent of the management company in providing
the release was confined to matters relative to management only, the court
apparently ruled that it covered the earlier transaction with the joint
venture as well.  The joint venture has appealed such dismissal, which
appeal is likely to extend the lawsuit beyond year-end.  In addition, the
former lender has filed an action against the joint venture for fees
expended in the litigation.  The Partnership and its affiliated partners in
the joint venture are also exploring the possibility of transferring their
rights in the litigation to the unaffiliated venture partners for a modest
sum.  Any such transfer would require that the Partnership and its
affiliates be released and adequately indemnified from further liability
relative to matters surrounding this litigation, including, but not limited
to, a release from any claims that the unaffiliated venture partners may
have against them relative thereto.  There can be no assurance that any
such transfer will be effected, that the litigation will ultimately be
successful, or that the Partnership will ultimately realize any amounts (or
avoid any further payments) with respect thereto.

ADJUSTMENTS

     In the opinion of the Corporate General Partner, all adjustments
(consisting solely of normal recurring adjustments) necessary for a fair
presentation have been made to the accompanying figures as of September 30,
1998 and for the three and nine months ended September 30, 1998 and 1997.



<PAGE>


PART I.  FINANCIAL INFORMATION

     ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     Reference is made to the notes to the accompanying financial
statements for additional information concerning certain of the
Partnership's investments.

     The board of directors of JMB Realty Corporation ("JMB") the corporate
general partner of the Partnership, has established a special committee
(the "Special Committee") consisting of certain directors of JMB to deal
with all matters relating to tender offers for Interests in the
Partnership, including any and all responses to such tender offers.  The
Special Committee has retained independent counsel to advise it in
connection with any potential tender offers for Interests and has retained
Lehman Brothers Inc. as financial advisor to assist the Special Committee
in evaluating and responding to any additional potential tender offers for
Interests.

     During 1997, some of the Holders of Interests in the Partnership
received from an unaffiliated third party unsolicited tender offers, each
to purchase up to 4.5% of the Interests in the Partnership at between $50
and $75 per Interest.  The Partnership recommended against acceptance of
these offers on the basis that, among other things, the offer prices were
inadequate.  All of such offers have expired.

     The Partnership is also aware that, in January 1998, an unaffiliated
third party made an unsolicited tender offer to some of the Holders of
Interests.  This offer sought to purchase up to 4.5% of the Interests in
the Partnership at $110 per Interest.  This offer expired in February 1998.

The Special Committee recommended against acceptance of the offer on the
basis that, among other things, the offer price was inadequate.

     As of the date of this report, the Partnership is aware that 4.38% of
the Interests have been purchased by all such unaffiliated third parties
either pursuant to such tender offers or through negotiated purchases.  It
is possible that other offers for Interests may be made by unaffiliated
third parties in the future, although there is no assurance that any other
third party will commence an offer for Interests, the terms of any such
offer or whether any such offer, if made, will be consummated, amended or
withdrawn.

     At September 30, 1998, the Partnership had cash and cash equivalents
of approximately $3,340,000.  Such funds are available for working capital
requirements.  Based upon current market conditions, the Partnership has
decided not to commit any additional amounts to the Mall of Memphis which
is incurring operating deficits.  This will result in the Partnership no
longer having an ownership interest in such property.  Such decision will
result in a gain to the Partnership for financial reporting and Federal
income tax purposes, with no corresponding distributable proceeds, in 1998
or 1999.

     Although the Partnership is hopeful it will be able to distribute sale
proceeds from the disposition of the Riverfront Office Building, the
Limited Partners are expected to receive less than their full original
investment from all sources.  After reviewing the remaining properties and


<PAGE>


the marketplace in which they operate, the General Partners of the
Partnership expect to be able to conduct an orderly liquidation of the
remaining investment portfolio as quickly as practicable.  If during 1998
the Partnership is successful in selling the Riverfront Office Building and
the underlying lender realizes upon its security in the Mall of Memphis and
all legal actions against the lender of the Yerba Buena Office Building are
resolved, the Partnership intends to wind up its affairs and liquidate by
year end 1998.  Because it appears unlikely that all of these events will
occur in 1998, the affairs of the Partnership would be wound up no later
than December 31, 1999, barring unforeseen economic developments.

RESULTS OF OPERATIONS

     The decrease in cash and cash equivalents at September 30, 1998 as
compared to December 31, 1997 is primarily due to the Partnership's
February 1998 distribution of $14,429,100 ($105 per Interest) to the
Holders of Interests of proceeds from the 1997 sales of the National City
Center Office Building and the Partnership's interest in the 767 Third
Avenue Office Building, partially offset by the Partnership's receipt in
February 1998 of approximate $3,980,000 in proceeds from the 1997 sale of
the National City Center Office Building.

     The decrease in rents and other receivables at September 30, 1998 as
compared to December 31, 1997 is primarily due to the timing of receipts of
rental income at Mall of Memphis.

     The increase in escrow deposits and restricted funds at September 30,
1998 as compared to December 31, 1997 is primarily due to (i) the
Partnership's classification in 1998 of all property cash at the Mall of
Memphis as restricted and (ii) the timing of payment of real estate taxes
at the Riverfront Office Building and deposits of 1998 net cash flow
generated by the Riverfront Office Building into escrow as required by the
underlying lender, partially offset by the May 1998 withdrawal by the
Partnership of interest earned to date on a $1,000,000 escrow account that
was established in March 1993 as security for any undiscovered
environmental issues as required by the lender for the Mall of Memphis.

     The increase in prepaid expenses at September 30, 1998 as compared to
December 31, 1997 is primarily due to the timing of payment of property
insurance premiums at the Mall of Memphis.

     The increases in properties held for sale or disposition and deferred
expenses at September 30, 1998 as compared to December 31, 1997 is
primarily due to tenant improvements and commissions paid related to
leasing activity at the Riverfront Office Building during 1998.

     The decrease in investment in unconsolidated venture, at equity, at
September 30, 1998 as compared to December 31, 1997 is due to the receipt
in February 1998 of approximately $3,980,000 in proceeds from the 1997 sale
of the National City Center Office Building.

     The increase in venture partner's deficit in venture at September 30,
1998 as compared to December 31, 1997 is due to the allocation of 1998
operating losses to the Partnership's venture partner in the Riverfront
Office Building.

     The decrease in unearned rents at September 30, 1998 as compared to
December 31, 1997 is primarily due to the timing of receipts of rental
income at the Mall of Memphis.

     The increase in accrued interest at September 30, 1998 as compared to
December 31, 1997 is primarily due to the Partnership's suspension of
scheduled debt service payments on the first, second and third mortgage
notes secured by the Mall of Memphis effective January 1, 1998 (as
discussed in the Notes).



<PAGE>


     The increase in long-term debt, less current portion at September 30,
1998 as compared to December 31, 1997 is due to the recording of interest
accruals pursuant to the terms of the restructured mortgage loan secured by
the Riverfront Office Building.

     The decreases in rental income, mortgage and other interest, property
operating expenses, and amortization of deferred expenses for the three and
nine months ended September 30, 1998 as compared to the three and nine
months ended September 30, 1997 is primarily due to the sale of the
Partnership's interest in the 767 Third Avenue Office Building on
October 31, 1997.  The decrease in property operating expenses for the
three and nine months ended September 30, 1998 as compared to the three and
nine months ended September 30, 1997 is also due to a decrease in real
estate taxes at the Mall of Memphis in 1998 resulting from a decrease in
the assessed value and the tax rate.

     The decrease in interest income for the nine months ended
September 30, 1998 as compared to the nine months ended September 30, 1997
is primarily due to interest received in June 1997 as part of a settlement
of past due rental obligations with a former tenant at the 767 Third Avenue
Office Building, partially offset by the temporary investment of the
approximately $11,000,000 in proceeds from the 1997 sale of the
Partnership's interest in the 767 Third Avenue Office Building until the
February 28, 1998 distribution of such proceeds to the Holders of
Interests.

     The decrease in depreciation expense for the three and nine months
ended September 30, 1998 as compared to the three and nine months ended
September 30, 1997 is due to the Mall of Memphis being classified as of
July 1, 1997 as held for sale or disposition and is therefore no longer
subject to continued depreciation as of the date of such classification.

     The increase in professional services for the three and nine months
ended September 30, 1998 as compared to the three and nine months ended
September 30, 1997 is primarily due to fees incurred in the suit against
the lender of the Yerba Buena Office Building for breach of its
obligations, as more fully discussed above, as well as legal costs
associated with collection of amounts due from certain tenants at the 767
Third Avenue Office Building.

     The $13,143,000 provision for value impairment for the nine months
ended September 30, 1997 is due to the Partnership's recording, as of June
1997, a provision for value impairment of the Mall of Memphis investment
property.

     The decrease in Partnership's share of operations of unconsolidated
venture for the three and nine months ended September 30, 1998 as compared
to the three and nine months ended September 30, 1997 is due to the sale of
the National City Center Office Building in December 1997.  The
Partnership's share of operations of unconsolidated venture for the three
and nine months ended September 30, 1998 is primarily the Partnership's
share of interest income earned by the venture on the sale proceeds prior
to the venture's distribution to the Partnership of its share of such
proceeds in February 1998.

     The decrease in venture partner's share of ventures' operations for
the three and nine months ended September 30, 1998 as compared to the three
and nine months ended September 30, 1997 is primarily due to a decrease in
operating losses at the Riverfront Office Building in 1998 due to an
increase in property occupancy and rental income.  The decrease in venture
partner's share of ventures' operations for the nine months ended
September 30, 1998 as compared to the nine months ended September 30, 1997
is partially offset by a decrease in operating income at the 767 Third
Avenue office building due to the receipt of interest income in June 1997
as part of a settlement of past due rental obligations with a former
tenant.


<PAGE>


PART II.  OTHER INFORMATION

     ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     Reference is made to the Notes to Consolidated Financial Statements
filed with this report for discussions of defaults under the note payable
secured by the Partnership's former venture partner's interest in the Mall
of Memphis and the mortgage notes secured by the Mall of Memphis investment
property, which discussions are hereby incorporated herein by reference.




<PAGE>


<TABLE>

     ITEM 5.  OTHER INFORMATION

                                                 OCCUPANCY

     The following is a listing of approximate occupancy levels by quarter for the Partnership's investment
properties owned during 1998.

<CAPTION>
                                                1997                                1998               
                                 -------------------------------------   ------------------------------
                                    At         At        At        At       At      At      At      At 
                                   3/31       6/30      9/30     12/31     3/31    6/30    9/30   12/31
                                   ----       ----      ----     -----     ----    ----   -----   -----
<S>                              <C>        <C>       <C>       <C>       <C>     <C>     <C>    <C>   
1.  Mall of Memphis
     Memphis, Tennessee (A) . .     82%        81%       85%       89%      86%     86%     79%

2.  Riverfront Office Building
     Cambridge, Massachusetts .     90%        90%       98%      100%      96%    100%     97%


<FN>

     (A)   Occupancy levels include temporary tenants.


</TABLE>


<PAGE>


ITEM 6.  EXHIBIT AND REPORTS ON FORM 8-K

   Response:

   (a)    Exhibits:

      3-A.     The Prospectus of the Partnership dated May 8, 1981, as
supplemented on July 27, 1981, October 9, 1981, November 5, 1981, December
10, 1981, February 19, 1982 and April 23, 1982, as filed with the
Commission pursuant to Rules 424(b) and 424(c), is hereby incorporated
herein by reference to Exhibit 3-A to the Partnership's Report for December
31, 1992 on Form 10-K (File No. 0-10494) filed on March 19, 1993.

      3-B.     Amended and Restated Agreement of Limited Partnership set
forth as Exhibit A to the Prospectus, which agreement is hereby
incorporated by reference to Exhibit 3-B to the Partnership's Report for
December 31, 1992 on Form 10-K (File No. 0-10494) filed on March 19, 1993.

      27.      Financial Data Schedule


   (b)    No reports on Form 8-K have been filed during the last quarter
of the period covered by this report.



<PAGE>


                              SIGNATURES



     Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XI

                BY:   JMB Realty Corporation
                      (Corporate General Partner)




                      By:   GAILEN J. HULL
                            Gailen J. Hull, Senior Vice President
                      Date: November 11, 1998


     Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person in the capacity
and on the date indicated.




                            GAILEN J. HULL
                            Gailen J. Hull, Principal Accounting Officer
                      Date: November 11, 1998