Item 2.  Acquisition or Disposition of Assets

                             SUMMER TREE APARTMENTS
                               North Dallas, Texas

         On June 2, 1998,  Apple REIT  Limited  Partnership  (together  with its
parent companies,  Apple Residential Income Trust, Inc., Apple General, Inc. and
Apple Limited, Inc., the "Company") purchased the Summer Tree Apartments located
at 13250 Emily Road in North Dallas, Texas (the "Property").

         The  Property comprises 232 apartment units. The purchase price for the
Property  was  $5,700,000.  The seller was Sunrise  Enterprises,  Inc.,  a Texas
corporation  which  was not  affiliated  with  the  Company,  Apple  Residential
Advisors, Inc. (the "Advisor") or their affiliates.  The purchase price was paid
entirely in cash using proceeds from the sale of Shares of the Company. Title to
the Property was conveyed to the Company by limited warranty deed.

         LOCATION.  The  Property  is located on Emily Road on the north side of
Interstate  635  (L.B.J.  Freeway),  and just west of U.S.  Highway 75  (Central
Expressway) in North Dallas,  Texas.  The Property is located within the greater
Dallas/Fort  Worth  metropolitan  statistical  area, or as it is called locally,
"The Metroplex."

         The following information is based in part upon information provided by
the Dallas  Chamber of  Commerce.  The  Dallas/Fort  Worth  Metroplex  is in the
north-central  part  of  Texas  and is  composed  of  nine  counties.  The  1996
population of The Metroplex was approximately 4,400,000. The Dallas metropolitan
area is the second largest in the state, behind Houston.

         The economy of the Dallas/Fort  Worth area is complex and  diversified.
Key economic factors include a large  manufacturing  base (including as products
military hardware,  electronics,  automobiles,  industrial equipment,  oil-field
parts,   food   products   and   chemicals),    banking,   insurance   services,
communications,  oil and gas production and air transportation.  Major employers
in the area include Texas Instruments,  Southwestern Bell, General Motors,  J.C.
Penney, NationsBank and Vought Aircraft Company.

         The  Metroplex  is also an  established  transportation  center for the
nation.  The Dallas/Fort  Worth  International  Airport  occupies  approximately
17,600 acres of land between the two cities. It is the second largest commercial
airport in the United  States in terms of land area,  and is the second  busiest
airport in the world, with more than 2,500 daily arrivals and departures.



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         The area also has a well-established  system of interstate highways and
supporting  secondary routes. The Metroplex is located at the hub of Interstates
35, 45, 20 and 30. Two outer loops,  Interstate 635 in Dallas and Interstate 820
in Fort Worth, surround the respective cities.

         The many  institutions of higher learning in the area include  Southern
Methodist University, the University of Texas at Dallas, the University of Texas
at Arlington, the University of North Texas, and Texas Christian University.

         The immediate  neighborhood  surrounding the Property consists of other
multi-family and  single-family  housing and commercial and retail  development.
The   Property   is   located    approximately    one-quarter    mile   from   a
multi-billion-dollar  Texas Instruments  facility.  The Property is proximate to
other businesses,  restaurants,  schools and churches and is readily  accessible
from Interstate 635 and Highway 75. The Property is an  approximately  20-minute
drive  from  Dallas/Fort  Worth  International   Airport  and  an  approximately
15-minute drive from downtown Dallas.

         DESCRIPTION OF THE PROPERTY.  The Property consists of 232 garden-style
apartment units in 11 two and three story buildings on  approximately  six acres
of land. The Property was constructed in 1980.

         The Property  offers four different unit types.  The unit mix and rents
being charged new tenants as of June 1998 are as follows:

                                         APPROXIMATE INTERIOR
 QUANTITY             TYPE                  SQUARE FOOTAGE       MONTHLY RENTAL
 --------            ----                   --------------       --------------
    96       One bedroom, one bathroom            481                 $439
    48       One bedroom, one bathroom            575                  464
    72       One bedroom, one bathroom            622                  484
    16       Two bedrooms, two bathrooms          933                  659


         The apartments provide a total of approximately  133,500 square feet of
net rentable area.

         The  Company  believes  that  the  Property  has  generally  been  well
maintained  and  is  in  good  condition.  However,  the  Company  has  budgeted
approximately  $348,000 for repairs and  improvements to the Property to include
clubhouse renovations, exterior painting, pool renovations, sign replacement and
interior upgrades.


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         The following information is provided by the seller. Physical occupancy
at the Property  averaged  approximately  94% in 1993, 94% in 1994, 96% in 1995,
96% in 1996 and 97% in 1997.  Leases at the Property are  generally for terms of
one year or less.  Average  rental rates for the past five years have  generally
increased.  As an example,  a  one-bedroom,  one-bathroom  apartment (622 square
feet) rented for $390 in 1993, $424 in 1994, $444 in 1995, $454 in 1996 and $484
in 1997. The average effective annual rental per square foot at the Property for
1993,  1994,  1995, 1996 and 1997 was $7.97,  $8.67,  $9.07,  $9.28,  and $9.89,
respectively.

         The Property has an outdoor  swimming pool, a fitness center, a laundry
facility and card- accessed  entrance  gates.  The Property also has a clubhouse
with a kitchen,  entertainment  area and  leasing  office.  There is ample paved
parking for tenants.

         The buildings are wood  frame  construction with a combination of brick
veneer,  stucco  and wood lap siding on  concrete  slab  foundations.  Roofs are
pitched and covered with asphalt shingles on plywood sheathing.

         Each apartment unit has wall-to-wall  carpeting in the living areas and
vinyl floors in the kitchen and bath. Each apartment unit has a cable television
hook-up and  individually  controlled  heating and  air-conditioning  unit. Each
kitchen  has  a  refrigerator/freezer,  electric  range  and  oven,  dishwasher,
microwave oven and garbage disposal. All units have washer/dryer connections and
all units except the smallest  one-bedroom units have a wood-burning  fireplace.
The owner of the  Property  pays for cold  water,  sewer  charges,  gas (for hot
water) and trash removal. The tenants pay for their electricity  service,  which
includes cooking, lighting, heating and air-conditioning.

         There are at least eight  apartment  properties  that  compete with the
Property.  All  offer  similar  amenities  and  generally  have  rents  that are
comparable to those of the Property.  Based on a recent  telephone  survey,  the
Advisor  estimates  that  occupancy  at  nearby  competing  properties  averaged
approximately 97% on May 31, 1998.

         As of May 31, 1998, the Property was  approximately  98% occupied.  The
tenants are primarily a mix of white-collar and blue-collar workers.


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         The following  table sets forth the 1997 real estate tax information on
the Property:


         JURISDICTION           ASSESSED VALUE        RATE            TAX
         ------------           --------------        ----            ---
County of Dallas . . . .  . . .  $4,423,510         $0.44307       $19,599.25
City of Dallas  . . . . . . . .   4,423,510          0.65160        28,823.59
Richardson I.S.D. . . . . . . .   4,423,510          1.60000        70,776.16
                                                                    ----------
     Total  . . . . . . . . . .                                   $119,199.00


         The basis of the depreciable  residential  real property portion of the
Property (currently estimated at about $2,738,537) will be depreciated over 27.5
years on a straight-line  basis. The basis of the personal property portion will
be depreciated in accordance with the modified  accelerated cost recovery system
of the Code. Amounts to be spent by the Company on repairs and improvements will
be treated for tax  purposes as permitted by the Code based on the nature of the
expenditures.

         The  Advisor  and the  Company  believe  that the  property is and will
continue to be adequately covered by property and liability insurance.

         MATERIAL  FACTORS  CONSIDERED IN ASSESSING  THE  PROPERTY.  The factors
considered  by the Advisor and the  Company to be  relevant  in  evaluating  the
Property for acquisition by the Company included the following:

         1. The Dallas/Fort  Worth area generally and the specific area in which
the Property is located  were  perceived  as being  characterized  by a diverse,
stable and steadily  growing  economy.  Accordingly,  it was believed  that such
economy  and  its  anticipated  growth  and  development  would  support  stable
occupancy rates and reasonable increases in rents at the Property.

         2.  Based  upon an  engineering  report  and its own  inspections,  the
Advisor  believes that the Property has been well maintained and is generally in
good  condition,  although  the Advisor  believes  that the planned  repairs and
improvements will allow an increase in rents at the Property.

         3. The  Property  has an  advantageous  location  -  convenient  to the
Dallas/Fort Worth International  Airport and downtown Dallas - and is located in
a   rapidly-growing   area   proximate  to  centers  of  employment  and  retail
development.

         ACQUISITION  AND  MANAGEMENT  SERVICES AND FEES.  In  consideration  of
services   rendered  to  the  Company  in  connection  with  the  selection  and
acquisition of the Property,  the Company paid Cornerstone  Realty Income Trust,
Inc. a property acquisition fee equal to 2% of the purchase price


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of the property,  or $114,000.  Cornerstone Realty Income Trust, Inc. will serve
as property  manager for the Property  and for its services  will be paid by the
Company  a monthly  management  fee  equal to 5% of the  gross  revenues  of the
Property plus reimbursement of certain expenses.

         The Company is not aware of any material  adverse  factors  relating to
the  Property  not set forth in this  report  that  would  cause  the  financial
information contained in this report not to be necessarily  indicative of future
operating results.


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