SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM 10-Q
(Mark One)

  X  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
-----
     EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 1995
                               ------------------
                                      OR

     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
-----
     EXCHANGE ACT OF 1934.

For the transition period from              to             
                               ------------    ------------

Commission file number 0-17653
                       -------

                       BALCOR PREFERRED PENSION-12
                    A REAL ESTATE LIMITED PARTNERSHIP         
          -------------------------------------------------------
          (Exact name of registrant as specified in its charter)

          Illinois                                      36-3523598    
-------------------------------                     -------------------
(State or other jurisdiction of                      (I.R.S. Employer  
incorporation or organization)                      Identification No.)

2355 Waukegan Rd., 
Bannockburn, Illinois                                     60015
----------------------------------------            ------------------- 
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code (708) 267-1600
                                                   --------------
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>
                         BALCOR PREFERRED PENSION - 12
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                                BALANCE SHEETS
                   September 30, 1995 and December 31, 1994
                                  (Unaudited)

                                    ASSETS

                                                    1995          1994
                                                 -----------   -----------
Cash and cash equivalents                       $ 3,089,539   $ 4,256,384
Accounts and accrued interest receivable             81,445        60,777
                                                 -----------   -----------
                                                  3,170,984     4,317,161
                                                 -----------   -----------
Investment in loan receivable                     7,841,453     7,889,890
Less:
  Allowance for potential loan losses               545,000       545,000
                                                 -----------   -----------
Net investment in loan receivable                 7,296,453     7,344,890

Investment in joint ventures - affiliates         4,881,736     5,268,196
                                                 -----------   -----------
                                                 12,178,189    12,613,086
                                                 -----------   -----------
                                                $15,349,173   $16,930,247
                                                 ===========   ===========

                       LIABILITIES AND PARTNERS' CAPITAL

Accounts payable                                $    32,737   $    44,388
Due to affiliates                                    14,159        42,961
                                                 -----------   -----------
     Total liabilities                               46,896        87,349

Partners' capital (292,708 Limited Partnership
  Interests issued and outstanding)              15,302,277    16,842,898
                                                 -----------   -----------
                                                $15,349,173   $16,930,247
                                                 ===========   ===========

   The accompanying notes are an integral part of the financial statements.
<PAGE>
                         BALCOR PREFERRED PENSION - 12
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                       STATEMENTS OF INCOME AND EXPENSES
             for the nine months ended September 30, 1995 and 1994
                                  (Unaudited)

                                                    1995          1994
                                                 -----------   -----------
Income:
  Interest on loans                             $   617,432   $   918,295
  Interest on short - term investments              175,189       118,488
                                                 -----------   -----------
    Total income                                    792,621     1,036,783
                                                 -----------   -----------
Expenses:
  Administrative                                    244,113       256,875
                                                 -----------   -----------
    Total expenses                                  244,113       256,875
                                                 -----------   -----------
Income before participation in loss of joint
  ventures - affiliates and equity in loss
  from investment in acquisition loan               548,508       779,908
Participation in loss of joint ventures -
  affiliates                                       (489,264)     (508,942)
Equity in loss from investment in acquisition
  loan                                              (48,437)      (53,535)
                                                 -----------   -----------
Net income                                      $    10,807   $   217,431
                                                 ===========   ===========
Net income allocated to General Partner         $    32,273   $    20,265
                                                 ===========   ===========
Net (loss) income allocated to Limited Partners $   (21,466)  $   197,166
                                                 ===========   ===========
Net (loss) income per Limited Partnership
    Interest (292,708 issued and outstanding)   $     (0.07)  $      0.67
                                                 ===========   ===========
Distributions to General Partner                $    32,273   $    20,265
                                                 ===========   ===========
Distributions to Limited Partners               $ 1,519,155   $   790,311
                                                 ===========   ===========
Distributions per Limited Partnership Interest  $      5.19   $      2.70
                                                 ===========   ===========

   The accompanying notes are an integral part of the financial statements.
<PAGE>
                         BALCOR PREFERRED PENSION - 12
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                       STATEMENTS OF INCOME AND EXPENSES
              for the quarters ended September 30, 1995 and 1994
                                  (Unaudited)

                                                    1995          1994
                                                 -----------   -----------
Income:
  Interest on loans                             $   205,811   $   205,991
  Interest on short - term investments               45,580        91,992
                                                 -----------   -----------
    Total income                                    251,391       297,983
                                                 -----------   -----------
Expenses:
  Administrative                                     67,632        80,931
                                                 -----------   -----------
    Total expenses                                   67,632        80,931
                                                 -----------   -----------
Income before participation in loss of joint 
  ventures - affiliates and equity in loss 
  from investment in acquisition loan               183,759       217,052
Participation in loss of joint ventures - 
  affiliates                                       (517,393)     (670,531)
Equity in loss from investment in acquisition 
  loan                                              (16,146)      (17,845)
                                                 -----------   -----------
Net loss                                        $  (349,780)  $  (471,324)
                                                 ===========   ===========
Net income allocated to General Partner         $    23,267   $     6,755
                                                 ===========   ===========
Net loss allocated to Limited Partners          $  (373,047)  $  (478,079)
                                                 ===========   ===========
Net loss per Limited Partnership Interest
    (292,708 issued and outstanding)            $     (1.27)  $     (1.64)
                                                 ===========   ===========
Distribution to General Partner                 $    23,267   $     6,755
                                                 ===========   ===========
Distribution to Limited Partners                $ 1,167,905   $   263,437
                                                 ===========   ===========
Distribution per Limited Partnership Interest   $      3.99   $      0.90
                                                 ===========   ===========

   The accompanying notes are an integral part of the financial statements.
<PAGE>
                         BALCOR PREFERRED PENSION - 12
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                           STATEMENTS OF CASH FLOWS
             for the nine months ended September 30, 1995 and 1994
                                  (Unaudited)

                                                     1995          1994
                                                 -----------   -----------
Operating activities:
  Net income                                    $    10,807   $   217,431
  Adjustments to reconcile net income to net
    cash provided by operating activities:
      Equity in loss from investment in 
        acquisition loan                             48,437        53,535
      Participation in loss of joint ventures - 
        affiliates                                  489,264       508,942
      Accrued interest income due at maturity of
        loan                                                       (7,196)
      Collection of accrued interest income due
        at maturity                                               132,966
      Net change in:                              
        Escrow deposits - restricted                               11,168
        Accounts and accrued interest receivable    (20,668)       43,286
        Accounts payable                            (11,651)      (29,272)
        Due to affiliates                           (28,802)       32,131
        Escrow liabilities                                        (22,273)
                                                 -----------   -----------
  Net cash provided by operating activities         487,387       940,718
                                                 -----------   -----------
Investing activities:
  Distributions from joint ventures - affiliates    195,221       148,151
  Contributions to joint ventures - affiliates     (298,025)
  Collection of principal on investment in 
    acquisition loan                                            5,250,000
                                                 -----------   -----------
  Net cash used in or provided by investing 
    activities                                     (102,804)    5,398,151
                                                 -----------   -----------
Financing activities:
  Distributions to Limited Partners              (1,519,155)     (790,311)
  Distributions to General Partner                  (32,273)      (20,265)
                                                 -----------   -----------
  Cash used in financing activities              (1,551,428)     (810,576)
                                                 -----------   -----------
Net change in cash and cash equivalents          (1,166,845)    5,528,293
Cash and cash equivalents at beginning of period  4,256,384     1,644,086
                                                 -----------   -----------
Cash and cash equivalents at end of period      $ 3,089,539   $ 7,172,379
                                                 ===========   ===========

   The accompanying notes are an integral part of the financial statements.
<PAGE>
                          BALCOR PREFERRED PENSION-12
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                         NOTES TO FINANCIAL STATEMENTS


1. Accounting Policy:

Mortgage servicing fees have been reclassified and are included in
administrative expenses during 1995. This reclassification has also been made
to the previously reported 1994 financial statements to conform with the
classification used in 1995. This reclassification has not changed the 1994
results. In the opinion of management, all adjustments necessary for a fair
presentation have been made to the accompanying statements for the nine months
and quarter ended September 30, 1995 and all such adjustments are of a normal
and recurring nature.

2. Transactions with Affiliates:

Fees and expenses paid and payable by the Partnership to affiliates during the
nine months and quarter ended September 30, 1995 are:
                                        
                                                  Paid                         
                                        -----------------------      
                                        Nine Months    Quarter     Payable
                                        -----------   ---------   --------- 
   Mortgage servicing fees                $17,952     $ 5,277     $ 1,759   
   Reimbursement of expenses to                
     the General Partner, at cost          86,010       7,513      12,400     
                                               
For the nine months ended September 30, 1995, the General Partner subordinated
receipt of one-half of its share of distributed Cash Flow, totaling $32,273.
This amount will be paid to the General Partner only after required
distribution levels to investors have been met and such amounts, if any, will
be allocated to the Repurchase Fund.

3. Investments in Joint Ventures - Affiliates:

The following information has been summarized from the financial statements of
the 45 West 45th Street Office Building and Sun Lake Apartments joint ventures:

                              September 30, 1995      September 30, 1994
                              ------------------      ------------------
Net investment in real
 estate as of September 30      $29,536,071             $31,427,997
Total liabilities as
 of September 30                 16,207,626              16,159,962        
Total income                      4,385,711               4,900,820  
Net loss                         (2,417,694)             (1,138,664)           
        
 
The Partnership and three affiliates previously funded a $23,000,000 loan on
the 45 West 45th Street Office Building. In February 1995, the participants
received title to the property through foreclosure. The Partnership owns a
21.74% joint venture interest in the property.  The net loss at September 30,
1995 includes a provision of $2,473,000 related to the decline in the fair
<PAGE>
value of 45 West 45th Street Office Building and the net loss at September 30,
1994 includes a provision of $1,800,000 related to the decline in the fair
value of Sun Lake Apartments.

4. Subsequent Event:

In October 1995, the Partnership paid $175,625 ($.60 per Interest) to Limited
Partners, representing a distribution for the third quarter of 1995 from Cash
Flow.
<PAGE>
                          BALCOR PREFERRED PENSION-12
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                     MANAGEMENT'S DISCUSSION AND ANALYSIS

Balcor Preferred Pension - 12 A Real Estate Limited Partnership (the
"Partnership") was formed in 1987 to invest in first mortgage loans,
wrap-around mortgage loans and other junior mortgage loans. The Partnership
raised $29,270,800 through the sale of Limited Partnership Interests and
utilized these proceeds to invest in four loans. The Partnership subsequently
reclassified its investment in two of these loans in which it held minority
participations to investment in joint ventures with affiliates. In addition,
one of the loans was repaid in 1994. As of September 30, 1995, the Partnership
had an investment in one loan and two joint ventures owning real estate in its
portfolio.

Inasmuch as the management's discussion and analysis below relates primarily to
the time period since the end of the last fiscal year, investors are encouraged
to review the financial statements and the management's discussion and analysis
contained in the annual report for 1994 for a more complete understanding of
the Partnership's financial position.

Summary of Operations
---------------------

The Partnership recognized its share of the declines in fair values of the 45
West 45th Street Office Building and the Sun Lake Apartments during the
quarters ended September 30, 1995 and 1994, respectively.  In addition, the
Skyline Village Mobile Home Park loan was repaid in June 1994. The combined
effect and the timing of these events resulted in a decrease in the net income
during the nine months ended September 30, 1995 and a decrease in the net loss
during the quarter ended September 30, 1995 when compared to the same periods
in 1994.  Further discussion of the Partnership's operations is summarized
below.

1995 Compared to 1994
---------------------

The June 1994 repayment of the Skyline Village loan resulted in a decrease in
interest income on loans for the nine months ended September 30, 1995 when
compared to the same period in 1994.

Higher interest rates and higher average cash balances due to proceeds received
from the Skyline Village loan repayment in June 1994 resulted in an increase in
interest income on short-term investments for the nine months ended September
30, 1995 as compared to the same period in 1994.  The special distribution to
Limited Partners in July 1995 resulted in a decrease in average cash balances
and interest income on short-term investments for the quarter ended September
30, 1995 as compared to the same period in 1994.  

As a result of higher legal fees in 1994 due to the default on the 45 West 45th
Street loan, administrative expenses were lower during the quarter ended
September 30, 1995 as compared to the same period in 1994.
<PAGE>
Allowances are charged to income when the General Partner believes an
impairment has occurred, either in a borrower's ability to repay the loan or in
the value of the collateral property. Determinations of fair value are made
periodically on the basis of performance under the terms of the loan agreements
and assessments of property operations. Determinations of fair value represent
estimations based on many variables which affect the value of real estate,
including economic and demographic conditions. The Partnership recognized no
provisions during the nine months ended September 30, 1995 and 1994 related to
its loans.

Participation in joint ventures with affiliates represents the Partnership's
share of the income or loss for the Sun Lake Apartments and the 45 West 45th
Street Office Building.  The Partnership recognized its share of the decline in
the fair value of the 45 West 45th Street Office Building and Sun Lake
Apartments during the quarters ended September 30, 1995 and 1994, respectively,
which resulted in participation in loss of joint ventures during the nine
months and quarters ended September 30, 1995 and 1994.
 
Liquidity and Capital Resources
--------------------------------

The cash position of the Partnership decreased as of September 30, 1995 as
compared to December 31, 1994.  The primary reason for the decrease was a
special distribution made to Limited Partners in July 1995 from Cash Flow
reserves and Mortgage Reductions received in connection with the Skyline
Village Mobile Home Park mortgage loan repayment.   

The Partnership classifies the cash flow performance of the properties in which
it has a joint venture interest as either positive, a marginal deficit or a
significant deficit.  A deficit is considered to be significant if it exceeds
$250,000 annually or 20% of the property's rental and service income.  The
Partnership defines cash flow generated from the properties as an amount equal
to the property's revenue receipts less property related expenditures, which
include any debt service payments.  The 45 West 45th Street Office Building,
which does not have any underlying debt, generated positive cash flow during
the nine months ended September 30, 1995 and 1994.  In addition, significant
leasing costs were incurred in 1995 at the property.  These items were not
included in classifying the cash flow performance of the property since they
are nonrecurring expenditures.  Had these costs been included, the property
would have generated a significant cash flow deficit for the nine months ended
September 30, 1995.  The occupancy rate of this property was 86% at September
30, 1995.  The Sun Lake Apartments, which has an underlying first mortgage
loan, generated positive cash flow during the nine months ended September 30,
1995 and 1994.  The occupancy rate of the property was 98% at September 30,
1995.  Rental markets continue to remain extremely competitive, therefore, the
General Partner's goals are to maintain high occupancy levels, while increasing
rents where possible, and to monitor and control operating expenses and capital
improvement requirements at the properties.  

In October 1995, the underlying revenue bonds, which financed the Sun Lake
Apartments $15,700,000 mortgage note payable, were refunded.  The proceeds from
the new bonds were used to repay the prior bonds.  The interest rate increased
from 4.5% to 5.375%.  The prior bonds were secured by a letter of credit for a
fee of 1.7% annually.  The new bonds require payment of guarantee and servicing
fees totaling .975% annually.  The monthly payment due on the new bonds is
$99,080.  The maturity date of the bonds is November 2025 with the next
mandatory remarketing date being November 2005.  In connection with the
refunding, the $700,000 debt service reserve was released, and the Sun Lake
<PAGE>
joint venture paid approximately $720,000 in financing and closing fees.  The
Partnership's share of these fees was approximately $274,000.

The Partnership and three affiliates funded a $23,000,000 mortgage loan
collateralized by the 45 West 45th Street Office Building. The Partnership
funded $5,000,000 of the loan amount for a participating percentage of 21.74%.
In February 1995, the participants received title to the property through
foreclosure.

In October 1995, the Partnership paid $175,625 ($.60 per Interest) to Limited
Partners, representing the regular quarterly distribution for the third quarter
of 1995 from Cash Flow. The level of the regular quarterly distribution is
consistent with that of the prior quarter. The Partnership also paid $4,503 to
the General Partner as its unsubordinated distributive share of Cash Flow for
the third quarter of 1995. To date, including the October 1995 distribution,
the Partnership has distributed $49.89 per $100 Limited Partnership Interest,
of which $36.52 represents Cash Flow from operations and $13.37 represents
Original Capital.

The Noland Fashion Square loan has been recorded by the Partnership as an
investment in acquisition loan. The Partnership has recorded its share of the
collateral property's operations as equity in loss from investment in
acquisition loan. The Partnership's share of operations has no effect on the
cash flow of the Partnership. Amounts representing contractually required debt
service are recorded as interest income on loans. 

The Partnership expects to continue making quarterly cash distributions from
available Cash Flow. In accordance with the Partnership Agreement, ninety-five
 percent  of such  Cash Flow  will be  distributed  to  Limited Partners, and
five percent will be distributed to the General Partner as its share from
Partnership operations, subject to certain subordinations. Cash available for
distribution will be determined by the General Partner after it creates any
reserves or makes expenditures appropriate for the operation of the
Partnership. There is no assurance that the Partnership will generate Cash Flow
or that, if generated, it will be available for distribution or be sufficient
to provide a return of Original Capital, the Warranty Distribution or the
Cumulative Return.

Inflation has several types of potentially conflicting impacts on real estate
investments. Short-term inflation can increase real estate operating costs
which may or may not be recovered through increased rents and/or sales prices,
depending on general or local economic conditions. In the long-term, inflation
can be expected to increase operating costs and replacement costs and may lead
to increased rental revenues and real estate values. 
<PAGE>
                          BALCOR PREFERRED PENSION-12
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                          PART II - OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K
-----------------------------------------
(a) Exhibits:

(4) Form of Subscription Agreement previously filed as Exhibit 4.1 in Amendment
No. 1 to the Registrant's Registration Statement on Form S-11 dated December 9,
1987 (Registration No. 33-16145) and Form of Confirmation regarding Interests
in the Registrant set forth as Exhibit 4.2 to the Registrant's Report on Form
10-Q for the quarter ended June 30, 1992 (Commission File No. 0-17653) are
incorporated herein by reference.

(27) Financial Data Schedule of the Registrant for the nine month period ending
September 30, 1995 is attached hereto. 

(b) Reports on Form 8-K:  A Current Report on Form 8-K dated September 14,
1995, as amended by Form 8-K/A dated October 27, 1995, was filed reporting a
change in the Registrant's certifying public accountants.
<PAGE>
SIGNATURES

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

                              BALCOR PREFERRED PENSION-12
                              A REAL ESTATE LIMITED PARTNERSHIP

                              By: /s/Thomas E. Meador
                                  -----------------------------               
                                  Thomas E. Meador
                                  President and Chief Executive Officer
                                  (Principal Executive Officer) of Balcor
                                  Mortgage Advisors-VIII, the General Partner


                              By: /s/Brian D. Parker
                                  ------------------------------
                                  Brian D. Parker
                                  Senior Vice President, and Chief Financial
                                  Officer (Principal Accounting and Financial
                                  Officer) of Balcor Mortgage Advisors-VIII,
                                  the General Partner


Date:  November 14, 1995
       ---------------------------
<PAGE>