SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
                                    FORM 10-K

                 FORM 10-K.-ANNUAL REPORT PURSUANT TO SECTION 13
                 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

(Mark One)
[x] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 [Fee Required]
For the fiscal year ended December 31, 2004
                          ------------------------------------------------------
                                       or

[ ]Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 [No Fee Required] For the transition period from         to
                                                            ---------  ---------
Commission file Number: 0-8952
                      ---------------------------------- -----------------------

                                   SB Partners
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

               New York                                    13-6294787
--------------------------------------            ------------------------------
    (State of other Jurisdiction of                      (I.R.S. Employer
     incorporation or organization)                     Identification No.)


1251 Avenue of the Americas, N.Y., N.Y.                      10020
---------------------------------------           ------------------------------
(Address of principal executive offices)                   (Zip Code)


Registrant's telephone number, including area code   (212) 408-2900
                                                  ------------------------------

Securities registered pursuant to Section 12(b) of the Act:

Title of each Class                    Name of each exchange on which registered
       NONE
-------------------                    -----------------------------------------

           Securities registered pursuant to Section 12(g) of the Act:

                     Units of Limited Partnership Interests
--------------------------------------------------------------------------------
                                (Title of Class)






<PAGE>2

     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. [X] Yes [ ] No

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (sec.229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. (x) (Amended by Exch Act Rel
No. 28869,eff. 5/1/91.)

     Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes [ ] No [X]

     State the aggregate market value of the voting and non-voting common equity
held by non-affiliates computed by reference to the price at which the common
equity was last sold, or the average bid and ask price of such common equity, as
of the last business day of the registrant's most recently completed second
fiscal quarter.

     NOTE: If a determination as to whether a particular person or entity is an
affiliate cannot be made without involving unreasonable effort and expense, the
aggregate market value of the common stock held by non-affiliates may be
calculated on the basis of assumptions reasonable under the circumstances,
provided that the assumptions are set forth in this Form.

                                 Not Applicable
                                 --------------

              APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
     Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12,13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. [] Yes [] NO

                                 Not Applicable
                                 --------------

                   (APPLICABLE ONLY TO CORPORATE REGISTRANTS)

     Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
                                 Not Applicable
                                 --------------

                      DOCUMENTS INCORPORATED BY REFERENCE.
     List hereunder the following documents if incorporated by reference and the
Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is
incorporated: (1) Any annual report to security holders; (2) Any proxy or
information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or
(c) under the Securities Act of 1933. The listed documents should be clearly
described for identification purposes (e.g. annual report to security holders
for fiscal year ended December 24, 1980).

                                      None
                                      ----






<PAGE>3
                                     PART I
                                     ------
ITEM 1.  BUSINESS
         --------
Description of SB Partners (the "Registrant")
---------------------------------------------

The Registrant is a New York limited partnership engaged in acquiring, operating
and holding for investment a varying portfolio of real estate interests. The
Registrant's initial public offering was in 1971, the year it began operations.
As of December 31, 2004, the Registrant owned apartment communities in St.
Louis, Missouri; Greenville, South Carolina; and Holiday and Orlando, Florida;
as well as an industrial flex property in Maple Grove, Minnesota, 13.9 acres of
land in Holiday, Florida, and a 75% non-controlling interest in a partnership
that owns an apartment property in West Chester, Pennsylvania.

The principal objectives of the Registrant are, first, to obtain capital
appreciation through equity investments in real estate; second, to generate cash
available for distribution, a portion of which may not be currently taxable; and
third, to the extent still permitted under the Internal Revenue Code of 1986, as
amended, to generate tax losses which may offset the limited partners' income
from the Registrant and certain other sources.

The Registrant does not maintain a Website. However, the Registrant's filings
with the Securities and Exchange Commission (the "SEC") are available on the
SEC's Website.


Recent Developments and Real Estate Investment Factors
------------------------------------------------------

The multifamily rental market in the United States continues to be heavily
influenced by the capital markets as low interest rates on home mortgages have
made the purchase of single-family homes and condominiums an attractive
alternative for many who would otherwise rent. As a result, more concessions
were offered to tenants at each of the Registrant's apartment communities. On a
same-store basis, rent concessions increased by 21% to $803,000 in 2004 from
$662,000 in 2003. Average occupancy for the apartment portfolio increased on a
same-store basis in 2004 to 89.6% from 88.3%.

(Please refer to Item 7. - Management's Discussion and Analysis of Financial
 Condition and Results of Operations.)






<PAGE>4





General Real Estate Risks
-------------------------

This report on Form 10-K includes statements that constitute "forward looking
statements" within the meaning of Section 27(A) of the Securities Act of 1933
and Section 21(E) of the Securities Exchange Act of 1934 and that are intended
to come within the safe harbor protection provided by those sections. By their
nature, all forward looking statements involve risks and uncertainties. Actual
results may differ materially from those contemplated by the forward looking
statements for a number of reasons, including, but not limited to, those risks
described below:

General
-------

The Registrant's investments generally consist of investments in real property
and as such will be subject to varying degrees of risk generally incident to the
ownership of real estate assets. The underlying value of the Registrant's real
estate investments and the Registrant's financial condition will be dependent
upon its ability to operate its properties in a manner sufficient to maintain or
increase revenues and to generate sufficient income in excess of operating
expenses. Income from the properties may be adversely affected by changes in
national and local economic conditions such as oversupply of apartment units, or
a reduction in demand for apartment units or industrial flex space in the
Registrant's markets, the attractiveness of the properties to tenants, changes
in interest rates and in the availability, cost and terms of mortgage financing,
the ongoing need for capital improvements, particularly in older structures,
changes in real estate tax rates, adverse changes in governmental rules and
fiscal policies, adverse changes in zoning laws, civil unrest, acts of God,
including natural disasters (which may result in uninsured losses), and other
factors which are beyond the control of the Registrant. If the Registrant were
unable to promptly renew or relet the leases of a significant number of tenants,
or, if the rental rates upon such renewal or reletting were significantly lower
than expected rates, the Registrant's results of operations, financial condition
and ability to make distributions to Unitholders may be adversely affected.


Risks of Liability and Loss
---------------------------

The development and ownership of real estate may result in liability to third
parties due to conditions existing on a property which may result in injury. In
addition, real estate may suffer a loss in value due to casualties such as fire
or hurricane. Such liability or loss may be uninsurable in some circumstances,
such as loss caused by the presence of mold, or may exceed the limits of
insurance maintained at typical amounts for the type and condition of the
property. Real estate may also be taken, in whole or in part, by public
authorities for public purposes in eminent domain proceedings. Awards resulting
from such proceedings may not adequately compensate the Registrant for the value
lost.

Value and Non-liquidity of Real Estate
--------------------------------------

Real estate investments are relatively non-liquid. The Registrant's ability to
vary its portfolio in response to changes in economic and other conditions will
therefore be limited. If the Registrant must sell an investment, there can be no
assurance that it will be able to dispose of the investment in the time period
it desires or that the sales price of the investment will recoup or exceed the
amount of the Registrant's cost of the investment.







<PAGE>5

Potential Adverse Effect on Results of Operations Due to Operating Risks
------------------------------------------------------------------------

The Registrant's properties are subject to operating risks common to real estate
in general, any and all of which may adversely affect occupancy or rental rates.
The Registrant's properties are subject to increases in operating expenses such
as cleaning, electricity, heating, ventilation, air conditioning, and
maintenance; insurance and administrative costs; marketing and payroll costs;
and other general costs associated with security, landscaping, repairs and
maintenance. The Registrant must bear all such increased expenses of apartment
communities, except in those markets where passing the cost of certain utilities
to tenants is customary. If operating expenses increase, the local rental market
may limit the extent to which rents may be increased to meet such additional
expenses without lowering occupancy rates. While the Registrant implements
cost-saving incentive measures at each of its properties, should any of the
foregoing occur, the Registrant's results of operations, financial condition and
its ability to pay distributions to Unitholders could be adversely affected.
Furthermore, the inability of existing tenants to meet their obligations under
the terms of their leases may in turn adversely affect the performance and
financial condition of the Registrant.


Debt Servicing and Financing
----------------------------

If the Registrant does not have funds sufficient to repay its indebtedness at
maturity, the Registrant may need to refinance such indebtedness with new debt
financing or through equity offerings. The Registrant may be restricted from
obtaining a loan which will be sufficient to retire the existing loan based on
lower debt service coverage, or if it is unable to refinance this indebtedness
on acceptable terms, the Registrant may be forced to dispose of properties upon
disadvantageous terms, which could result in losses to the Registrant and
adversely affect the amount of cash available for distribution to Unitholders.
If prevailing interest rates or general economic conditions result in higher
interest rates at a time when the Registrant must refinance its indebtedness,
the Registrant's interest expense could increase, which would adversely affect
the Registrant's results of operations, financial condition and its ability to
pay expected distributions to Unitholders. Further, if any of the Registrant's
properties are mortgaged to secure payment of indebtedness and the Registrant is
unable to meet mortgage payments, the mortgagee could foreclose or otherwise
transfer the property, with a consequent loss of income and asset value to the
Registrant.

Environmental Issues
--------------------

Under various Federal, state and local environmental laws, ordinances and
regulations, an owner or operator of real estate may be liable for the costs of
removal or remediation of certain hazardous or toxic substances on such
property. These laws often impose environmental liability without regard to
whether the owner or operator knew of, or was responsible for, the presence of
such hazardous or toxic substances. The presence of such substances, or the
failure to properly remediate their presence, may adversely affect the owner's
or operator's ability to sell or rent the property or to borrow using the
property as collateral. Persons who arrange for the disposal or treatment of
hazardous or toxic substances may also be liable for the costs of removal or
remediation of such substances at a disposal or treatment facility, whether or
not such facility is owned or operated by such person. Certain third parties may
seek recovery from owners or operators of such properties or persons who
arranged for the disposal or treatment of hazardous or toxic substances and,
therefore, are potentially liable for removal or remediation costs, as well as
certain other related costs, including governmental fines and injuries to
persons and property.







<PAGE>6

Competition
-----------

The Registrant competes for tenants with many other real estate owners. The
success of the Registrant in attracting tenants for its properties will depend
upon its ability to maintain its properties and their attractiveness to tenants,
neighborhood conditions, changing demographic trends, et cetera. All of the
Registrant's properties are located in developed areas that include other,
similar properties. The number of competitive properties in a particular area
could have a material effect on the Registrant's ability to lease apartment
units or industrial flex space at its properties and on the rents charged at
such properties. In addition, other forms of housing, including manufactured
housing community properties and single-family housing, provide alternatives to
potential residents of multi-family residential properties.

Tax Matters
-----------

There were no changes in the tax laws or the extent to which such legislation
impacts the Registrant or the partners during the year ended December 31, 2004.
Unitholders are urged to consult their own tax advisors with respect to the tax
consequences arising under the federal law and the laws of any state,
municipality or other taxing jurisdiction, including tax consequences arising
from such Unitholder's own tax characteristics.

General
-------
Efforts required in complying with Federal, state and local environmental
regulations may have and may continue to have an adverse effect on the
Registrant's operations in the future, although such costs have not historically
been significant in amount.

There are approximately 44 full and part-time on-site project personnel employed
at the Registrant's properties.

The Registrant's real estate investments are not generally subject to seasonal
fluctuations, although net income (loss) may vary somewhat from quarter to
quarter based upon changes in utility consumption and seasonal maintenance
expenditures at each property.

The Registrant considers itself to be engaged in only one industry segment, real
estate investment, and therefore information regarding industry segments is not
applicable and has not been provided.







<PAGE>7

ITEM 2.PROPERTIES
       ----------

The properties owned by the Registrant as of December 31, 2004 are as follows:

<TABLE>
                                                          SB PARTNERS
                                                     Summary of Properties
                                                    As of December 31, 2004
<CAPTION>
                                                                                                       Occupancy
                                                          Description         Acquisition    Percent      at        Mortgage
           Property                  Location        Sq. Ft.   Units   Acres      Date      Ownership  12/31/04      Payable
<S>                            <C>                 <C>        <C>     <C>    <S>           <C>        <C>        <C>
Apartments:

Holiday Park Apts.             Holiday, FL             220,000     244   21.5   Jan 1991      100%       90.2%       $ 3,468,112
Cypress Key Apts. (e)          Orlando, FL             323,000     360   22.7   Aug 1998      100%       95.8%       $15,904,543
Halton Place Apts.             Greenville, SC          233,000     246   20.6   Dec 1998      100%       91.9%       $ 3,900,000
Le Coeur du Monde Apts.        St. Louis, MO           177,000     192   12.3   Sep 1999      100%       96.9%       $ 9,755,977
Waterview Apartments           West Chester, PA        168,000     203   19.7   Apr 2002       75%       74.9%       $         0
                                                     ---------  ------  -----
                                                     1,121,000   1,245   96.8
                                                     =========   =====  =====
Industrial Flex:

Eagle Lake Business Center IV  Maple Grove, MN          60,000     n/a   5.15   Jun 2002      100%       100%        $         0

Land:

Unimproved land (a)            Holiday, FL                 n/a     n/a   13.9   Jul 1978      100%        n/a        $         0

Additional information regarding properties owned by the Registrant:
<CAPTION>
                                                   2004     2003     2002     2001    2000
                                                   ----     ----     ----     ----    ----
<S>                                             <C>       <C>      <C>      <C>     <C>
Average Occupancy (b)
-----------------
Meadowwood Apts.                                    n/a      n/a      n/a     96.3%   93.5%
Holiday Park Apts.                                 94.5%    94.5%    90.9%    91.6%   91.5%
Cypress Key Apts. (e)                              91.7%    89.7%    90.4%    92.1%   94.0%
Halton Place Apts.                                 90.3%    84.5%    87.2%    88.5%   91.6%
Le Coeur du Monde Apts.                            93.9%    86.7%    93.0%    93.0%   89.0%
Eagle Lake Business Center IV                     100.0%   100.0%   100.0%     n/a     n/a

Effective Annual Rent
--------------------
Meadowwood Apts. (c)                               n/a       n/a    $7,013   $6,962  $6,454
Holiday Park Apts. (c)                           $5,522    $5,261   $5,056   $5,038  $4,861
Cypress Key Apts. (c) (e)                        $7,656    $7,469   $7,706   $8,016  $7,866
Halton Place Apts. (c)                           $5,886    $5,685   $6,095   $6,477  $6,610
Le Coeur du Monde Apts. (c)                      $8,799    $8,358   $9,164   $8,963  $8,513
Eagle Lake Business Center IV (d)                $   14    $   14   $   12     n/a     n/a


</FN>
</TABLE>
(a) Land is adjacent to Holiday Park Apartments.
(b) For period of ownership.
(c) Per apartment unit. Gross potential rent, less concessions and vacancies,
    divided by the total number of units at the property. Annualized for
    periods of ownership of less than one year.
(d) Per square foot. Gross potential rent plus escalations, divided by the
    total number of square feet at the property. Annualized for periods of
    ownership of less than one year.
(e) Property is held for sale.






<PAGE>8

ITEM 3.LEGAL PROCEEDINGS
       -----------------

The Registrant is a party to certain actions arising directly from its normal
business operations. While the ultimate outcome is not presently determinable
with certainty, the Registrant believes that the resolution of these matters
will not have a material effect on its financial position or results of
operations.

ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF UNITHOLDERS
       ----------------------------------------------
NONE.

                                    PART II
                                    -------

ITEM 5.MARKET FOR REGISTRANT'S UNITS OF PARTNERSHIP
       INTEREST AND RELATED UNITHOLDER MATTERS
       --------------------------------------------

The transfer of Units or Participations (equivalent to one-half Unit) is subject
to certain limitations, including the consent of the General Partner. There is
no public market for the Units and it is not anticipated that any such public
market will develop. The number of Unitholders as of December 31, 2004 was
3,318.

At various times, the Registrant has generated and distributed cash to the
Unitholders. With the repositioning of the portfolio, the Registrant was able to
resume distributions to the limited partners in 1999. A distribution of $40 per
unit totaling $310,140 was paid on March 8, 2004 to Unitholders of record on
December 31, 2003. In addition, a distribution of $40 per unit, totaling
$310,140 was paid on March 1, 2005 to Unitholders of record as of December 31,
2004. Including the latest distribution, cumulative distributions since
inception have totaled $105,467,615, however, there is no requirement to make
such distributions nor can there be any assurance that future operations will
generate cash available for distribution.







<PAGE>9

ITEM 6.SELECTED FINANCIAL DATA
       -----------------------
<TABLE>
SELECTED FINANCIAL DATA

The following table sets forth selected financial data regarding the
Registrant's financial condition and results of operations determined in
accordance with accounting principles generally accepted in the United States of
America. This data should be read in conjunction with the Audited Consolidated
Financial Statements and Notes thereto, and Management's Discussion and Analysis
of Financial Condition and Results of Operations, included elsewhere in this
annual report on Form 10-K.  Certain prior year amounts have been reclassified
to make them comparable to the current year presentation.

<CAPTION>
                                                                                 For the Years Ended December 31,
                                                           2004            2003             2002            2001            2000
                                                         --------        --------         --------        --------         -------
                                                                            (In Thousands, Except Unit Data)
<S>                                                     <C>             <C>              <C>             <C>              <C>
Income Statement Data:
Rental, Interest and Other Revenues                      $ 5,624         $ 5,386          $ 6,956          $9,786          $ 9,452
Operating Expenses, less
  Depreciation and Amortization                           (5,188)         (5,088)          (7,507)         (8,396)          (8,281)
Depreciation and Amortization                               (994)         (1,054)          (1,069)         (1,551)          (1,827)
                                                         -------         -------         --------        --------         --------
Loss from Continuing Operations                             (558)           (756)          (1,620)           (161)            (656)

Gain on Sale of Investments in Real Estate                     0               0           17,481               0                0
Equity in Net Loss of Joint Venture                         (317)           (239)             (93)              0                0
Loss from Discontinued Operations                           (455)           (533)            (450)           (148)            (310)
                                                         -------         -------         --------        --------         --------
Net Income (Loss)                                        $(1,330)        $(1,528)         $15,318          $ (309)          $ (966)
                                                         =======         =======         ========        ========         ========

Net Income (Loss) per Unit of Partnership Interest:        $(171)          $(197)          $1,976           $ (40)          $ (125)
                                                         =======         =======         ========        ========         ========

Distributions paid per Unit of Partnership Interest         $ 40           $ 500            $ 100           $ 100            $ 115
                                                         =======         =======         ========        ========         ========
Weighted Average Number of
  Partnership Units Outstanding                            7,754           7,754            7,754           7,754            7,754

Balance Sheet Data at Year End:

Real Estate, net                                         $32,114         $32,490          $32,960         $31,798          $29,225
Real Estate Assets Held for Sale                         $20,221         $20,747          $21,211         $32,370          $36,120
Total Assets                                             $56,310         $57,811          $60,508         $67,005          $67,791
Mortgage Notes Payable                                   $17,124         $16,607          $13,826         $34,502          $34,054
Other liabilities in discontinued operations             $15,958         $16,587          $16,510         $16,778          $16,977

</TABLE>






<PAGE>10

ITEM 7.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
       CONDITION AND RESULTS OF OPERATIONS
       -------------------------------------------------

COMPANY OVERVIEW
----------------

The Registrant is a New York limited partnership engaged in acquiring, operating
and holding for investment a varying portfolio of real estate interests. The
Registrant's initial public offering was in 1971, the year it began operations.
As of December 31, 2004, the Registrant owned apartment communities in St.
Louis, Missouri; Greenville, South Carolina; and Holiday and Orlando, Florida;
as well as an industrial flex property in Maple Grove, Minnesota, 13.9 acres of
land in Holiday, Florida, and a 75% non-controlling interest in a partnership
that owns an apartment property in West Chester, Pennsylvania.

The principal objectives of the Registrant are, first, to obtain capital
appreciation through equity investments in real estate; second, to generate cash
available for distribution, a portion of which may not be currently taxable; and
third, to the extent still permitted under the Internal Revenue Code of 1986, as
amended, to generate tax losses which may offset the limited partners' income
from the Registrant and certain other sources.


CRITICAL ACCOUNTING ESTIMATES
-----------------------------

In preparing the consolidated financial statements, management has made
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting periods. Actual results could differ
from those estimates.

Set forth below is a summary of the accounting policies that management believes
are critical to the preparation of the consolidated financial statements. The
summary should be read in conjunction with the more complete discussion of
significant accounting policies included in Note 1 to the consolidated financial
statements for the year ended December 31, 2004.


Real Estate
-----------

Real estate is carried at cost, net of accumulated depreciation and
amortization. Maintenance and repairs are charged to operations as incurred.
Depreciation requires an estimate by management of the useful life of each
property as well as an allocation of the costs associated with a property to its
various components. If the Partnership does not allocate these costs
appropriately or incorrectly estimates the useful lives of its real estate,
depreciation expense may be misstated.

The Partnership's properties are regularly evaluated on a property-by-property
basis for impairment. Impairment is determined by calculating the sum of the
estimated undiscounted future cash flows including the projected undiscounted
future net proceeds from the sale of the property. In the event such sum is less
than the net carrying value of the property, the property will be written down
to estimated fair value. If the Partnership incorrectly estimates the value of
the asset or the undiscounted cash flows, the impairment charges may be
different from those, if any, in the consolidated financial statements.


Joint Venture
--------------

The Partnership has a non-controlling interest in a joint venture that is
accounted for under the equity method of accounting because the other venture
partner has substantive participative rights regarding the venture's operations.
Were the Partnership deemed to control this entity, it would have to be
consolidated and therefore would impact the balance sheet, statement of
operations and related ratios. The ultimate realization of the investment in the
joint venture is dependent on a number of factors, including the performance of
the investee and market conditions. If the venture determines that the real
estate held by its investee is other than temporarily impaired, then an
impairment charge would be recorded by the venture and the Partnership would
record its share of loss. The joint venture has experienced recurring losses
from operations and current operating cash flow is insufficient to fund property
operations and contractual debt service payments on the mortgage note.
Management believes that such cash flow shortfalls are temporary as a result of
poor local market conditions and is currently evaluating alternative funding
plans to bridge the shortfall period.







<PAGE>11

Revenue Recognition
-------------------

Rental income is recognized when earned pursuant to the terms of the leases.
Base rents and reimbursement of the tenants' share of certain operating expenses
are generally recognized when due from tenants. Before the Partnership can
recognize revenue, it is required to assess, among other things, its
collectibility. The Partnership continually analyzes the collectibility of its
revenue and will reserve against its revenue if conditions warrant such action.


Off-Balance Sheet Arrangements
------------------------------

None.


Recently Issued Accounting Pronouncements
-----------------------------------------
There are no new accounting prononcements or interpretations that have been
issued but not yet adopted that will have a material impact on the financial
statements.



CONTRACTUAL OBLIGATIONS
-----------------------

As of December 31, 2004, the Registrant's contractual obligations consisted of
mortgage notes payable. Principal payments under the mortgage notes payable are
due as follows:

For the year ending December 31, 2005                    4,377,325
                                 2006                      511,732
                                 2007                      548,635
                                 2008                    3,746,722
                                 2009                   23,844,218
                                                       -----------
                                 Total                 $33,028,632
                                                       ===========








<PAGE>12

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

As of December 31, 2004, the Registrant had cash and cash equivalents of
approximately $126,000, in addition to approximately $571,000 of deposits held
in escrow by certain lenders for the payment of insurance, real estate taxes and
certain capital and maintenance costs, of which approximately $272,000 is
included in other assets in discontinued operations. These balances are
approximately $157,000 less then the cash, cash equivalents and deposits held in
escrow as of December 31, 2003. Lower cash balances are due primarily to capital
additions to the real estate properties and mortgage note principal reductions,
offset by cash flow from operating activities. Operations provided approximately
$678,000 of cash after a $97,000 decrease in deposits held in escrow by lenders,
of which approximately $199,000 was provided by discontinued operations. Uses of
cash during the year included distributions amounting to approximately $310,000
that were paid to Unitholders of record as of December 31, 2003. Capital
additions to existing real estate properties totaled approximately $653,000
during the year, of which $51,000 were for real estate held for sale, and
principal reductions of approximately $445,000 were made on mortgage notes
payable, of which $263,000 was applied to other liabilities in discontinued
operations. Contributions to joint venture totaled approximately $30,000.

In March 2001, the Registrant entered into a revolving credit facility with a
bank in the amount of $7,500,000, which is secured by Halton Place Apartments.
At December 31, 2004, $3,900,000 was outstanding under the credit facility, and
is included in continuing operations. The term of the credit facility has been
extended to September 1, 2005. Borrowings bear interest at LIBOR plus 1.95%.

Total outstanding debt at December 31, 2004 consisted of approximately
$29,129,000 of long-term nonrecourse first mortgage notes, of which
approximately $15,900,000 is included in other liabilities in discontinuing
operations, and approximately $3,900,000 under the revolving credit facility,
all secured by real estate owned by the Registrant. Scheduled maturities through
regularly scheduled monthly payments will be approximately $4,377,000 in 2005.
The terms of certain mortgage notes require escrow of estimated annual real
estate tax, insurance and reserves for repairs, maintenance and improvements to
the secured property, in addition to the payment of principal and interest. The
Registrant generally has no other debt except normal trade accounts payable and
accrued interest on mortgage notes payable.

Inflation and changing prices during the current period did not significantly
affect the markets in which the Registrant conducts its business, or the
Registrant's business overall.

In March 2004, the Registrant made a distribution of $40 per Unit to Unitholders
of record as of December 31, 2003. However, there is no requirement to make such
distributions, nor can there be any assurance that future operations will
generate cash available for distribution.

The Registrant's properties are expected to generate sufficient cash flow to
cover operating, financing, and capital improvement costs, and other working
capital requirements of the Registrant, for the foreseeable future.






<PAGE>13

MANAGEMENT'S DISCUSSION OF RESULTS OF OPERATIONS
------------------------------------------------
2004 VS. 2003
-------------

Total revenues from continuing operations increased $239,000 to approximately
$5,624,000 in 2004 from approximately $5,386,000 in 2003. The Registrant
generated a net loss from continuing operations of approximately $875,000 in
2004, a decrease of $121,000, as compared with a net loss of approximately
$995,000 in 2003. Total expenses from continuing operations for 2004 increased
approximately $41,000 to $6,182,000 from $6,141,000 in 2003. Such increase was
primarily the result of an increase in real estate operating expenses of
$184,000 and interest expense of $32,000 offset by decreases in real
estate taxes and depreciation and amortization of $106,000 and $60,000,
respectively. Total revenues from discontinued operations increased $88,000 to
approximately $2,890,000 in 2004 from approximately $2,802,000 in 2003. The
Registrant generated a net loss from discontinued operations of approximately
$456,000 in 2004, a decrease of $77,000, as compared with a net loss of
approximately $533,000 in 2003. Total expenses from discontinuing operations for
2004 increased approximately $10,000 to $3,345,000 from $3,335,000 in 2003. In
addition, equity in net loss from joint venture increased by approximately
$78,000 to approximately $317,000 in 2004 as compared to approximately $239,000
in 2003.

Interest expense from continuing operations was approximately $32,000 higher for
the year ended December 31, 2004 than 2003. This is primarily due to additional
interest that accrued as a result of additional borrowings under the secured
revolving credit agreement, which is included as continuing operations. Interest
expense from discontinued operations was approximately $17,000 lower for the
year ended December 31, 2004 than 2003.

For additional analysis, please refer to the discussions of the individual
properties below.

Holiday Park Apartments (Holiday, Florida)
-----------------------

Total revenues increased $96,000, to approximately $1,495,000 in 2004 from
approximately $1,399,000 in 2003. Net income, which includes deductions for
depreciation and mortgage interest expense, increased $27,000, to approximately
$183,000 in 2004 from approximately $156,000 in 2003.

The increase in total revenues was due to a 6% increase in rental rates
implemented at the property on new and renewing leases. Occupancy averaged 94.5%
for both 2004 and 2003. Operating expenses rose $75,000 over 2003 due to
approximate increases of $51,000, $17,000 and $15,000 in repairs and
maintenance, trustee fees and utilities. These increases were offset by a
decrease in real estate taxes of approximately $10,000.

Holiday Park Apartments is located in Holiday, Florida, a city that is included
in the Tampa-St. Petersburg, Florida Metropolitan Statistical Area ("MSA"). The
MSA continued to see robust job growth in 2004 as employment increased by
approximately 26,300 jobs or 2.1% of its employment base. Vacancy rate for the
MSA decreased to 8% by the end of 2004 which is the result of lower unit
deliveries to market, condominium conversions taking rental units off-line and
the aforementioned job growth.







<PAGE>14

Cypress Key Apartments (Orlando, Florida)
----------------------

Cypress Key Apartments has been designated as real estate property held for
sale as of October 19, 2004. As such, this investment is reflected as real
estate property held for sale on the accompanying consolidated balance sheets.
Other assets and the liabilities of this property are reflected as other assets
and liabilities in discontinued operations on the accompanying consolidated
balance sheets. The results of operations from the property are reflected as
loss from discontinued operations in the accompanying consolidated statement of
operations.

Total revenues increased $88,000 to approximately $2,890,000 in 2004 from
approximately $2,802,000 in 2003. Net loss, which includes deductions for
depreciation and mortgage interest expense, decreased $77,000 to approximately
$456,000 in 2004 from approximately $533,000 in 2003.

The increase in total revenues was primarily due to a 1% increase in rental
rates implemented at the property on new and renewing leases, which resulted in
a $22,000 increase in revenues. In addition, a 14% decrease in vacancy loss
resulted in a $51,000 increase in revenues. Property occupancy increased 2% from
an average of 89.7% in 2003 to 91.7% in 2004. Net loss decreased as a result of
higher revenues in the current year offset by an increase in expenses of $10,000
due to approximate increases of $22,000, $11,000, $11,000, and $9,000 in
advertising, administration, payroll and repairs and maintenance, respectively,
offset by decreases of approximately $20,000 and $10,000 in depreciation and
real estate tax, respectively .

Expanding employment in the educational/health care and leisure/hospitality
sectors lead to continued strong job growth in the Orlando MSA in 2004. Overall
employment grew by 2.4% or approximately 23,000 jobs over 2003 levels. The
unemployment rate improved to 4.1% at the end of 2004 from approximately 5% at
the end of 2003. The robust economy also lead to an improvement in the MSA
apartment vacancy rate to 7% at year end 2004 from 9% at the end of 2003. Rental
increases slowed slightly to 1.2% in 2004 as a result of higher demand for home
ownership in the continued low interest rate environment.


Halton Place Apartments (Greenville, South Carolina)
-----------------------

Total revenues increased $69,000, to approximately $1,499,000 in 2004 from
approximately $1,430,000 in 2003. Net income, which includes deductions for
depreciation and mortgage interest expense, increased $53,000, to approximately
$158,000 in 2004 from approximately $105,000 in 2003.

The increase in total revenues was primarily due to a $109,000 decrease in
vacancy loss resulting from a 5.8% increase in average occupancy to 90.3% in
2004 from 84.5% in 2003. The decrease in vacancy loss was off set by a $62,000
increase in tenant concessions. The increase in net income was due primarily to
the increase in revenues offset by a $16,000 increase in expenses. Interest
expense and administrative costs increased approximately $47,000 and $12,000,
respectively. These were offset by decreases of $21,000, $9,000 and $6,000 in
amortization, depreciation and real estate taxes.

Halton Place Apartments is located within the Greenville-Spartanburg-Anderson,
South Carolina MSA. Greenville-Spartenburg-Anderson employment expanded by
approximately 14,500 jobs for the twelve months ended November 2004 although the
unemployment rate grew from 5.8% to 6.0% over the same period. The market
vacancy rate improved slightly to 12.1% in November 2004 from the year earlier
12.5%.  Rental rates declined by approximately 3% year over year as absorption
lagged
new supply.







<PAGE>15


Le Coeur du Monde Apartments (St. Louis, Missouri)
----------------------------

Total revenues increased $72,000, to approximately $1,754,000 in 2004 from
approximately $1,682,000 in 2003. Net loss, which includes deductions for
depreciation and mortgage interest expense, decreased $96,000, to approximately
$200,000 in 2004 from approximately $296,000 in 2003.

The increase in total revenues was primarily due to a $129,000 decrease in
vacancy loss resulting from a 7.2% increase in average occupancy to 93.9% in
2004 from 86.7% in 2003. This decrease in vacancy loss was off set by a $50,000
increase in tenant concessions. The increase in net income was due primarily to
the increase in revenues in addition to a decrease in expenses of approximately
$23,000. Real estate taxes, depreciation and interest decreased $78,000, $10,000
and $13,000 respectively. These were offset by payroll, repairs & maintenance,
administrative and advertising costs which increased approximately $27,000,
$27,000, $13,000 and $12,000, respectively.

During 2004, St. Louis reversed three years of job losses with 38,000 new jobs
or 3.0% over its employment base of approximately 1,361,000. Research reports
indicate this is one of the fastest growing metropolitan areas in the United
States. Despite an improved employment picture, apartment vacancy rates held
steady during 2004 due to higher levels of new construction and affordable
single family homes. Market rate rents declined by 0.8% in 2004 over year
earlier levels.


Eagle Lake Business Center IV (Maple Grove, Minnesota)
-----------------------------

Total revenues increased $7,000, to approximately $868,000 in 2004 from
approximately $861,000 in 2003. Net income, which includes deductions for
depreciation, increased $40,000, to approximately $480,000 in 2004 from
approximately $440,000 in 2003.

The increase in total revenues was primarily due to a $30,000 increase in rental
income, offset by a $23,000 decrease in operating recoveries as compared to the
prior years. Occupancy for both years was 100%. The increase in net income was
primarily due to a decrease in expenses of $32,000 in addition to the increase
in revenues. The decrease in expenses was primarily due to $14,000 and $10,000
reductions in repairs & maintenance and real estate taxes, respectively.

The Minneapolis-St Paul industrial market continued its modest recovery during
2004.  Net absorption of the industrial space in the MSA totaled approximately
2,300,000 square feet in 2004 and vacany rates improved to 7.0% at the end of
the year.  Lease rates increased slightly to 4.27 per square foot for all
industrial and $5.20 per square foor for office showroom space.  The
Minneapolis-St. Paul labor market remains strong as the unemployment rate of
4.0% is lower than the national average of 5.1%.

Investment in Joint Venture
---------------------------

Equity in net loss of joint venture for 2004 was approximately $317,000 as
compared with $239,000 for 2003. Equity in net loss of joint venture is net of
the Registrant's portion of deductions for depreciation of approximately
$371,000 and $364,000, for the years ended December 31, 2004 and 2003,
respectively. The joint venture has experienced recurring losses from operations
and current operating cash flow is insufficient to fund property operations and
contractual debt service payments on the mortgage note. Management believes that
such cash flow shortfalls are temporary as a result of soft local market
conditions and is currently evaluating alternatives to generate additional funds
required to cover the shortfall.







<PAGE>16


MANAGEMENT'S DISCUSSION OF RESULTS OF OPERATIONS
------------------------------------------------
2003 VS. 2002
-------------

Total revenues from continuing operations decreased $1,570,000 to approximately
$5,386,000 in 2003 from approximately $6,956,000 in 2002. Continuing operations
generated a net loss of approximately $995,000 in 2003 as compared with
approximately $1,712,000 in 2002, a decrease of $717,000. Total revenues from
discontinued operations decreased $113,000 to approximately $2,802,000 in 2003
from approximately $2,915,000 in 2002. Discontinued operations generated a net
loss of approximately $533,000 in 2003 as compared with approximately $450,000
in 2002, an increase of $83,000. Net income for 2002 also includes a net gain on
the sale of Meadowwood Apartments of approximately $17,481,000.

The changes in continuing and discontinuing operations total revenues and net
income are the result of the changes in the composition of the portfolio that
were made in 2002, as well as decreases in revenues and net income for the
properties owned for the entire years of 2003 and 2002. On April 30, 2002, the
Registrant purchased a 75% non-controlling interest in a partnership that owns
Waterview Apartments, a 203-unit apartment community in West Chester,
Pennsylvania. On May 9, 2002, the Registrant sold Meadowwood Apartments, a
704-unit apartment community in Reno, Nevada, for $31,350,000 in an all cash
transaction, and retired the mortgage note payable that had been secured by the
property. In addition, on June 12, 2002, the Registrant purchased Eagle Lake
Business Center IV, a 60,345 square foot industrial flex property in Maple
Grove, Minnesota, for $4,700,000, in an all cash transaction.

There were no revenues from Meadowwood Apartments in 2003, however, revenues
from Meadowwood Apartments totaled approximately $1,783,000 for the period the
property was owned during 2002. The decrease in revenues from Meadowwood
Apartments was partially offset by additional revenues from Eagle Lake Business
Center IV, which was purchased in June 2002. Revenues from the industrial flex
property were approximately $466,000 higher in 2003, as the property was owned
for a full year, whereas it was only owned for six and one-half months in the
prior year.

Interest expense from continuing operations was approximately $1,725,000 lower
for the year ended December 31, 2003 than 2002. In 2002, the Registrant made a
yield maintenance payment of approximately $1,056,000 when the mortgage note
that had been secured by Meadowwood Apartments was retired at the time the
property was sold. This yield maintenance payment was included in interest
expense for the year ended December 31,2002. The reduction in periodic interest
payments resulting from the retirement of the loan were partially offset by
additional interest that accrued as a result of additional borrowings under the
secured revolving credit agreement.

For additional analysis, please refer to the discussions of the individual
properties below.


Holiday Park Apartments (Holiday, Florida)
-----------------------

Total revenues increased $44,000, to approximately $1,399,000 in 2003 from
approximately $1,355,000 in 2002. Net income, which includes deductions for
depreciation and mortgage interest expense, increased $20,000, to approximately
$156,000 in 2003 from approximately $136,000 in 2002.

The increase in total revenues was due to a 3% increase in rental rates
implemented at the property on new and renewing leases and a 21% improvement in
vacancy loss, partially offset by increased concessions offered to new and
renewing tenants totaling $28,000. Occupancy averaged 94.5% for 2003, which was
an improvement of 3.6% over average occupancy of 90.9% in 2002. Operating
expenses excluding interest expense and depreciation rose $24,000 over 2002 due
to higher real estate taxes, insurance costs and professional fee expenses,
partially offset by lower payroll and repair costs.

Holiday Park Apartments is located in Holiday, Florida, a city that is included
in the Tampa-St. Petersburg, Florida Metropolitan Statistical Area ("MSA"). The
MSA was one of the few areas in the nation that exhibited job growth during 2003
and its unemployment rate of less than 5% was below the national average
estimated to be approximately 6% for 2003. Lower construction of multifamily
apartment communities than levels in the previous three years and the
aforementioned job growth helped keep the overall apartment vacancy rate in the
MSA somewhat stable at approximately 8.5% for 2003.









<PAGE>17
Cypress Key Apartments (Orlando, Florida)
----------------------

Cypress Key Apartments has been designated as real estate property held for
sale as of October 19, 2004. As such, this investment is reflected as real
estate property held for sale on the accompanying consolidated balance sheets.
Other assets and the liabilities of this property are reflected as other assets
and liabilities in discontinued operations on the accompanying consolidated
balance sheets. The results of operations from the property are reflected as
loss from discontinued operations in the accompanying consolidated statement of
operations.

Total revenues decreased $113,000 to approximately $2,802,000 in 2003 from
approximately $2,915,000 in 2002. Net loss, which includes deductions for
depreciation and mortgage interest expense, increased $83,000 to approximately
$533,000 in 2003 from approximately $450,000 in 2002.

The decrease in total revenues is due primarily to increased tenant concessions
at the property of $120,000. A new apartment community built directly across
from Cypress Key Apartments in 2002 continues to be very aggressive in its
leasing efforts, which necessitated greater concessions on new and renewing
leases. Rental rates increased a nominal 1.2% over the prior year on new and
renewing leases, and average property vacancy increased slightly to 10.3% from
the rate a year earlier of 9.6%. Net loss increased as a result of lower
revenues in the current year offset by a decrease in expenses of $29,000.
Payroll expense decreased $26,000 during the current year, reflecting longer
downtime between restaffing positions and repairs and maintenance costs
decreased $22,000.
Insurance expense increased again in 2003 by $23,000 due to higher premiums.

The Orlando economy was estimated to have generated 14,000 new jobs in 2003
while it's unemployment rate stabilized at approximately 5% during the year.
Multifamily construction in the market produced 4,700 new units, which is nearly
60% below 2000's total of nearly 12,000 units constructed and delivered. Rent
increases during 2003 were estimated to have increased market wide by
approximately 1.5%. Market vacancy rates were up for the third consecutive year
to approximately 9% despite lower new unit deliveries reflecting increasing
single-family home purchases from the low interest rate environment.


Halton Place Apartments (Greenville, South Carolina)
-----------------------

Total revenues decreased $108,000, to approximately $1,430,000 in 2003 from
approximately $1,538,000 in 2002. Net income, which includes deductions for
depreciation and mortgage interest expense, decreased $202,000, to approximately
$105,000 in 2003 from approximately $307,000 in 2002.

The decrease in total revenues is due primarily to an increase in tenant
concessions at the property of $59,000. Average occupancy decreased 2.7%, to
84.5% in 2003 from 87.2% in 2002, which reduced rental revenue $57,000. The
decrease in net income was due primarily to a decrease in revenues and an
increase in expenses. Payroll expense increased $19,000, due to higher staffing
costs. Insurance expense increased $18,000 after the policies were renewed,
reflecting an overall increase in insurance premiums. Utility expenses increased
by $15,000 due to higher utility rates. Interest expense increased by $42,000
due to increased borrowings under the secured revolving credit agreement.

Halton Place Apartments is located within the Greenville-Spartanburg-Anderson,
South Carolina MSA. The MSA employment base contracted at an average annual rate
of 0.9% for the one-year period ended October 31, 2003 or an overall loss of
4,400 jobs. The manufacturing sector, which has been historically strong in this
market, lost the most jobs due to the continued relocation trend of textile
labor to overseas markets. The average occupancy rate in the market was 87.5% at
the end of November 2003 reflecting a decrease of 1.8% from the prior year
occupancy rate of 89.3%. The decrease reflects the continuing trend of
single-family home buying and newly constructed apartment communities entering
the market.








<PAGE>18
Le Coeur du Monde Apartments (St. Louis, Missouri)
----------------------------

Total revenues decreased $155,000, to approximately $1,682,000 in 2003 from
approximately $1,837,000 in 2002. Net loss, which includes deductions for
depreciation and mortgage interest expense, increased $175,000, to approximately
$296,000 in 2003 from approximately $121,000 in 2002.

Average occupancy for the current year decreased 6.3% from 93.0% to 86.7%,
although base rents were approximately 1.5% or $30,000 higher than the previous
year. In addition, tenant concessions were significantly higher in 2003, which
reduced revenues $60,000. The increase in net loss is due to the aforementioned
decrease in revenues, increases in real estate taxes of $23,000 and insurance
expense of $17,000, and partially offset by savings in repairs and maintenance
and property management fees.

While some research reports indicate that the St. Louis MSA has weathered the
nationwide economic slowdown better than most Midwestern markets, the area is
still experiencing job losses. Through the end of 2003, job losses were reported
to be 1%, or 11,300 jobs, primarily from the decline of airline activity from
the sale of TWA to American Airlines in 2001 and continuing manufacturing sector
job losses. This is the third consecutive year of reported job losses in the
MSA. As with many markets across the nation, single-family home buying activity
continues to negatively impact occupancy and rent levels in St. Louis. Reported
market vacancy at December 31, 2003 was 5.2% as compared with 5.6% for the year
earlier.


Eagle Lake Business Center IV (Maple Grove, Minnesota)
-----------------------------

On June 12, 2002, the Registrant purchased Eagle Lake Business Center IV, a
60,345 square foot industrial flex property located in Maple Grove, Minnesota,
for $4,700,000, in an all cash transaction. (Refer also to Footnotes 3 and 4 of
the Consolidated Financial Statements.)

Total revenues for 2003 were approximately $861,000 as compared with $395,000
for the period of ownership during 2002. Net income, which includes deductions
for depreciation expense, was approximately $440,000 for 2003 as compared with
$212,000 for the period of ownership in 2002. Total revenue for 2003 and 2002
respectively was comprised of rental income of approximately $547,000 and
$302,000, respectively, and escalation income of approximately $313,000 and
$93,000, respectively. Expenses for 2003 and 2002 related primarily to real
estate taxes of approximately $177,000 and $53,000, respectively, depreciation
expense of approximately $110,000 and $64,000, respectively, and other property
operating expenses of $133,000 and $65,000 respectively.

Eagle Lake Business Center IV is an office/showroom industrial property located
in the northwest Minneapolis, Minnesota suburb of Maple Grove. The Twin Cities
economy, which includes St. Paul, showed no change in the unemployment rate as
of December 31, 2003 from year-earlier levels of 4.1%, which was well below the
national average of approximately 6%. Leasing activity for office/showroom space
in the Northwest Minneapolis submarket has shown signs of improvement during
2003 as seen by an improvement in the market vacancy rate from 13.5% in June
2003 to 11.5% in December 2003. New construction has also slowed as only 375,000
square feet of industrial space was in development during the first half of 2003
as compared with the construction of 19 million square feet of industrial space
in the previous six years.


Investment in Joint Venture
---------------------------

On April 30, 2002, the Registrant purchased a 75% non-controlling interest in a
partnership that owns Waterview Apartments in West Chester, Pennsylvania.
Waterview Apartments comprises 203 apartment units and 6,000 square feet of
commercial space. (Refer also to Footnotes 4 and 5 of the Consolidated Financial
Statements.)

Equity in net loss of joint venture for 2003 was approximately $239,000 as
compared with $93,000 for the period of ownership in 2002. Equity in net loss of
joint venture is net of the Registrant's portion of deductions for depreciation
of approximately $364,000 and $236,000, for the year ended December 31, 2003 and
the period of ownership ended December 31, 2002, respectively.








<PAGE>19



ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
        ----------------------------------------------------------

On March 1, 2001, the Registrant entered into a revolving credit facility
agreement with a bank under which borrowings bear interest at rates that
fluctuate with LIBOR. As such, the Registrant has market risk to the extent
interest rates fluctuate during the term and funds are advanced by the bank
under the agreement. Based on the weighted average outstanding balance under the
credit facility for the year ended December 31, 2004, a 1% change in LIBOR would
impact the Registrant's annual net income and cash flows by approximately
$38,000.

ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
       -------------------------------------------

The Financial Statements required by this item, together with the report of
Independent Registered Public Accounting Firm thereon, are contained herein on
pages 27 through 41 of this annual report on Form 10-K. Supplementary financial
information required by this item is contained herein on pages 42 through 43 of
this report.


ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
        ------------------------------------------------
        ACCOUNTING AND FINANCIAL DISCLOSURE
        -----------------------------------

None.


ITEM 9A. CONTROLS AND PROCEDURES
           -----------------------

(a)   The President and the Chief Financial Officer of the general partner of SB
      Partners have evaluated the disclosure controls and procedures relating to
      the Registrant's Annual Report on Form 10-K for the year ended December
      31, 2004 as filed with the Securities and Exchange Commission and have
      judged such controls and procedures to be effective.

(b)   There have been no changes in the Registrant's internal controls during
      the year ended December 31, 2004 that could significantly affect those
      controls subsequent to the date of evaluation.





<PAGE>20
                                   PART III
                                   --------
ITEM 10.DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
        --------------------------------------------------

The Registrant has no executive officers or directors. All of its business
affairs are handled by its General Partner, SB Partners Real Estate Corporation
(the "General Partner").

The directors and executive officers of the General Partner are elected by
Sentinel Holdings Corporation ("SHC") as its sole shareholder to serve until
their successors are duly elected and qualified. The limited partners of the
Registrant are not entitled to vote in their election.

The directors and executive officers of the General Partner who are active in
the Registrant's operations are:

         Name                     Age       Position
         ----                     ---       --------

         John H. Streicker         62       President & Director

         Millie C. Cassidy         59       Vice President & Director

         David Weiner              69       Chief Executive Officer

         Anita Breslin             48       First Vice President

         Robert Leniart            48       Vice President

         Martin Cawley             48       Vice President

         George N. Tietjen         44       Principal Financial &
                                            Accounting Officer


Mr. Streicker joined the General Partner in May 1976.  He has been a Director
since April 1984.  He is Chairman of SHC and its parent company, The Sentinel
Corporation.

Ms. Cassidy joined the General Partner in August 1982.  She has been a Director
of the General Partner since March 1988.  She is President of SHC and its
parent company, The Sentinel Corporation.

Mr. Weiner joined the General Partner in April 1984.  He has been a Director of
the General Partner since March 1988.  He is Vice Chairman of SHC and its
parent company, The Sentinel Corporation.

Ms. Breslin joined the General Partner in 1978.  She is the regional manager
responsible for residential property transactions and management for the
Northeastern region.

Mr. Leniart joined the General Partner in 1983.  He is the regional manager
responsible for residential property transactions and management for the
Southeastern region.

Mr. Cawley joined the General Partner in 1994.  He is the regional manager
responsible for commercial property transactions and management for the
Northern region.

Mr. Tietjen joined the General Partner in 1990 and serves as its principal
financial & accounting officer. He is a certified public accountant with over
23 years of real estate related financial, accounting and reporting experience.







<PAGE>21

ITEM 11.EXECUTIVE COMPENSATION
        ----------------------
The Registrant has no executive officers or directors.

ITEM 12.SECURITY OWNERSHIP OF CERTAIN
        -----------------------------
        BENEFICIAL OWNERS AND MANAGEMENT
        --------------------------------

(a)  At December 31, 2004, an institutional investor of record owned 7.13% of
     the outstanding Units of Limited Partnership Interests. On January 13,
     1993, a group of Unitholders of record, including the institutional
     investor referred to above, entered into a collective agreement with
     respect to their ownership interest in the Registrant. The aggregate number
     of Units beneficially owned by the group is 676 Units, representing 8.7% of
     the total number of outstanding Units of Limited Partnership Interest on
     that date. Each Unitholder has disclaimed beneficial ownership of all Units
     owned by the other Unitholders in this group. The foregoing information is
     based upon a 13-D filing made by the respective Unitholders.

(b)  As of December 31, 2004, none of the Directors of the General Partner owned
     any outstanding Units of Limited Partnership Interest. However, an
     Assistant Secretary of the General Partner owned four Units of Limited
     Partnership Interest. No Officers or Directors of SHC owned any outstanding
     Units of Limited Partnership Interest. SRE Clearing Services, Inc., an
     affiliate of the General Partner, owned 1,682.75 Units of Limited
     Partnership Interest, representing 21.70% of the outstanding number of
     Units on December 31, 2004. In accordance with SEC regulations, SRE
     Clearing Services filed Form 13-D/A on August 28, 2003, when the total
     number of Units held reached 19% of the outstanding number of Units.

(c)  During the year ended December 31, 2004, there were no changes in control
     of the Registrant or the General Partner.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
         ----------------------------------------------

The General Partner, among other things, furnishes services and advice to the
Registrant and is paid a variable annual fee for such services based on
calculations prescribed in the Registrant's Partnership Agreement. For these
services, the General Partner receives a management fee equal to 2% of the
average amount of capital invested in real estate plus cumulative mortgage
amortization payments, and 0.5% of capital not invested in real estate, as
defined in the partnership agreement. The management fee amounted to $712,845,
$711,984, and $794,498 for the years ended December 31, 2004, 2003, and 2002,
respectively. In addition, the General Partner is entitled to 25% of cash
distributions in excess of the annual distribution preference, as defined in the
partnership agreement. No such amounts were due for the years ended December 31,
2004, 2003 or 2002.

Certain affiliates of the General Partner oversee the management and operations
of various real estate properties, including those owned by the Registrant.
Services performed by these affiliates applicable to the Registrant's properties
are billed at actual or allocated cost, or percentage of revenues. The costs of
such services are believed to be competitive with charges for similar services
provided by unrelated management companies. Fees charged by these affiliates
totaled $617,279, $600,677, and $689,131 in 2004, 2003, and 2002, respectively.

In connection with the mortgage financing of certain properties, the respective
lenders required the Registrant to place the assets and liabilities of these
properties into single asset limited partnerships or land trusts which hold
title to these properties. A trust company affiliated with the General Partner
holds the general partner interest in each single asset limited partnership as
trustee for the Registrant. An affiliate of the General Partner is also the
trustee of the land trust. For its services, the affiliate is paid an annual
fee, which aggregated $42,800, $25,824, and $47,580 in 2004, 2003, 2002,
respectively, and is based upon the trust company's standard rate schedule.

Reference is made to Items 10 and 11, and Notes 2 and 9 in the consolidated
financial statements.







<PAGE>22
                                    PART IV
                                    -------

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
         --------------------------------------

1.   Audit Fees. The aggregate fees billed for professional services rendered by
     the principal accountant for the audit of the Partnership's annual
     financial statements and review of financial statements included in the
     Partnership's Form 10-Q or services that are normally provided by the
     accountant in connection with statutory and regulatory filings or
     engagements for those fiscal years were approximately $165,000 and $150,000
     for the years ended December 31, 2004 and 2003, respectively.

2.   Audit-Related Fees. No fees were billed by the principal accountant during
     the years ended December 31, 2004 and 2003 for assurance and related
     services that are reasonably related to the performance of the audit or
     review of the Partnership's financial statements that are not reported
     under subparagraph (1) of this section.

3.   Tax Fees. The aggregate fees billed for professional services rendered by
     the principal accountant for tax compliance, tax advice, and tax planning
     were $20,000 and $20,000 for the years ended December 31, 2004 and 2003,
     respectively. This work included reviewing year-end tax projections as well
     as the Registrant's tax returns prepared by the Registrant for the
     respective years.

4.   All Other Fees. No other fees were billed in either of the last two fiscal
     years for products and services provided by the principal accountant, other
     than the services reported in subparagraphs (1) through (3) of this
     section.

5.   (i)The selection of the independent auditors to audit the annual financial
     statements and perform review procedures on the quarterly reports filed
     with the SEC by the Registrant is made by the general partner of the
     partnership. Fees quoted by the independent auditors are approved by the
     general partner prior to their acceptance by the Registrant.
     (ii) Not Applicable.

6.       Not Applicable.




ITEM 15. EXHIBITS, FINANCIAL STATEMENT
         -----------------------------
         SCHEDULES AND REPORTS ON FORM 8-K
         ---------------------------------

(a)  (1) Financial statements - The Registrant's 2004 Annual Audited
         Consolidated Financial Statements are included in this annual
         report on Form 10-K.

     (2) Financial statement schedules - See Index to Consolidated Financial
         Statement Schedules on page 27. All other financial statement schedules
         are inapplicable or the required subject matter is contained in the
         consolidated financial statements or notes thereto.


 (b) Exhibits Incorporated by Reference -

                                   Incorporated by
Description                        Reference to
-----------                        ---------------
Agreement of                       Exhibit A to Registration Statement on Form
Limited Partnership                S-11 as filed with the Securities and
                                   Exchange Commission on May 16, 1985






<PAGE>23


SIGNATURES
----------

Pursuant to the requirements of Section 13 or 15 (d) 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.


                                         SB PARTNERS
                                         -----------

                                   By:   SB PARTNERS REAL ESTATE CORPORATION
                                         -----------------------------------
                                         GENERAL PARTNERS


                                         Chief Executive Officer

March 31, 2005                           /s/ David Weiner
                                         ---------------------
                                   By:   David Weiner
                                         Vice Chairman


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.



Signature                          Position                          Date
---------                          --------                          ----

/s/ David Weiner
---------------------              Chief Executive Officer        March 31, 2005
David Weiner                      (Vice Chairman)



/s/ George N. Tietjen III          Principal Financial &
-------------------------          Accounting Officer             March 31, 2005
George N. Tietjen III             (Chief Financial Officer &
                                   Treasurer)







<PAGE>24

     Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


I, David Weiner, certify that:

      (1) I have reviewed this annual report on Form 10-K of SB Partners;

      (2) Based on my knowledge, this annual report does not contain any untrue
          statement of material fact or omit to state a material fact necessary
          to make the statements made, in light of the circumstances under which
          such statements were made, not misleading with respect to the year
          covered by this annual report;

      (3) Based on my knowledge, the financial statements, and other financial
          information included in this annual report, fairly present in all
          material respects the financial condition, results of operations and
          cash flows of the registrant as of, and for, the periods presented in
          this annual report;

      (4) The registrant's other certifying officer and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rule 13a-15(e)(4) and 15d-15(e)(4)) for the
          registrant and have:

          (a)  designed such disclosure controls and procedures, or cause such
               disclosure controls and procedures to be designed under our
               supervision, to ensure that material information relating to the
               registrant, including its consolidated subsidiaries, is made
               known to us by others within those entities, particularly during
               the period in which this annual report is being prepared;

          (b)  evaluated the effectiveness of the registrant's disclosure
               controls and procedures and presented in this report our
               conclusions about the effectiveness of the disclosure controls
               and procedures, as of the end of the period covered by this
               annual report based on such evaluation; and

          (c)  disclosed in this report any change in the registrant's internal
               control over financial reporting that occurred during the
               registrant's most recent fiscal quarter (the registrant's fourth
               fiscal quarter in the case of an annual report) that has
               materially affected, or is reasonably likely to materially
               affect, the registrant's internal control over financing
               reporting; and

      (5) The registrant's other certifying officer and I have disclosed, based
          on our most recent evaluation of internal control over financial
          reporting, to the registrant's auditors and the audit committee of the
          Registrant's board of directors (or persons performing the equivalent
          functions):

          (a)  all significant deficiencies and material weaknesses in the
               design or operation of internal control over financial reporting
               which are reasonably likely to adversely affect the registrant's
               ability to record, process, summarize and report financial
               information ; and

          (b)  any fraud, whether or not material, that involves management or
               other employees who have a significant role in the registrant's
               internal control over financial reporting.


                                        Chief Executive Officer

Date: March 31, 2005                    /s/ David Weiner
                                        ---------------------
                                        David Weiner
                                        Vice Chairman





<PAGE>25

     Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, George N. Tietjen III, certify that:

      (1) I have reviewed this annual report on Form 10-K of SB Partners;

      (2) Based on my knowledge, this annual report does not contain any untrue
          statement of material fact or omit to state a material fact necessary
          to make the statements made, in light of the circumstances under which
          such statements were made, not misleading with respect to the year
          covered by this annual report;

      (3) Based on my knowledge, the financial statements, and other financial
          information included in this annual report, fairly present in all
          material respects the financial condition, results of operations and
          cash flows of the registrant as of, and for, the periods presented in
          this annual report;

      (4) The registrant's other certifying officer and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rule 13a-15(e)(4) and 15d-15(e)(4)) for the
          registrant and have:

          (a)  designed such disclosure controls and procedures, or cause such
               disclosure controls and procedures to be designed under our
               supervision, to ensure that material information relating to the
               registrant, including its consolidated subsidiaries, is made
               known to us by others within those entities, particularly during
               the period in which this annual report is being prepared;

          (b)  evaluated the effectiveness of the registrant's disclosure
               controls and procedures as of a date within 90 days prior to the
               filing date of this annual report (the "Evaluation Date"); and

          (c)  disclosed in this report any change in the registrant's internal
               control over financial reporting that occurred during the
               registrant's most recent fiscal quarter (the registrant's fourth
               fiscal quarter in the case of an annual report) that has
               materially affected, or is reasonably likely to materially
               affect, the registrant's internal control over financing
               reporting;

      (5) The registrant's other certifying officer and I have disclosed, based
          on our most recent evaluation of internal control over financial
          reporting, to the Registrant's auditors and the audit committee of the
          Registrant's board of directors (or persons performing the equivalent
          functions):

          (a)  all significant deficiencies and material weaknesses in the
               design or operation of internal control over financial reporting
               which are reasonably likely to adversely affect the Registrant's
               ability to record, process, summarize and report financial
               information; and

          (b)  any fraud, whether or not material, that involves management or
               other employees who have a significant role in the registrant's
               internal control over financial reporting.


                                        Principal Financial & Accounting Officer


Date: March 31, 2005                    /s/ George N. Tietjen III
                                        ----------------------
                                        George N. Tietjen III
                                        Chief Financial Officer & Treasurer








<PAGE>26

     Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, David Weiner, certify that:
      (1)  the Annual Report on Form 10-K of the registrant for the annual
           period ended December 31, 2004, as filed with the Securities and
           Exchange Commission (the "Report"), fully complies with the
           requirements of Section 13(a) or 15(d) of the Securities Exchange Act
           of 1934;

      (2) the information contained in the Report fairly presents, in all
          material respects, the financial condition and results of operations
          of the registrant.

                                        Chief Executive Officer

Date: March 31, 2005                    /s/ David Weiner
                                        ---------------------
                                        David Weiner
                                        Vice Chairman



     Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, George N. Tietjen III, certify that:

      (1)  the Annual Report on Form 10-K of the registrant for the annual
           period ended December 31, 2004, as filed with the Securities and
           Exchange Commission (the "Report"), fully complies with the
           requirements of Section 13(a) or 15(d) of the Securities Exchange Act
           of 1934;

      (2) the information contained in the Report fairly presents, in all
          material respects, the financial condition and results of operations
          of the registrant.

                                        Principal Financial & Accounting Officer


Date: March 31, 2005                    /s/ George N. Tietjen III
                                        ---------------------
                                        George N. Tietjen III
                                        Chief Financial Officer & Treasurer





<PAGE>27


                                   SB PARTNERS

                         ITEMS 8 and 14 (a) (1) and (2)

                   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
                   -------------------------------------------

                 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND
                 ----------------------------------------------
                    SUPPLEMENTAL FINANCIAL STATEMENT SCHEDULE
                    -----------------------------------------

Report of Independent Registered Public Accounting
       Firm ..................................................................28

Balance Sheets as of December 31, 2004 and 2003...............................29

Statements of Operations
       for the years ended December 31, 2004, 2003 and 2002...................30

Statements of Changes in Partners' Capital
       for the years ended December 31, 2004, 2003 and 2002...................31

Statements of Cash Flows
       for the years ended December 31, 2004, 2003 and 2002...................32

Notes to Financial Statements............................................33 - 39

Supplemental Financial Statement Schedule:

Schedule III -- Real Estate and Accumulated Depreciation
       December 31, 2004.................................................40 - 41






<PAGE>28
             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Partners of SB Partners:


       We have audited the accompanying consolidated balance sheets of SB
Partners and subsidiaries (collectively, the "Partnership") as of December 31,
2004 and 2003, and the related consolidated statements of operations, changes in
partners' capital and cash flows for each of the three years in the period ended
December 31, 2004. Our audits also included the financial statement schedule
listed in the foregoing Table of Contents. These financial statements and
financial statement schedule are the responsibility of the Partnership's
general partner. Our responsibility is to express an opinion on the financial
statements and financial statement schedule based on our audits.

       We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Partnership's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by the general
partner, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.

       In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of the SB
Partners and subsidiaries as of December 31, 2004 and 2003, and the results of
their operations and their cash flows for each of the three years in the period
ended December 31, 2004, in conformity with accounting principles generally
accepted in the United States of America. Also, in our opinion, such financial
statement schedule, when considered in relation to the basic
consolidated financial statements taken as a whole, presents fairly, in all
material respects, the information set forth therein.




/s/ Deloitte & Touche LLP


New York, New York
March 22, 2005






<PAGE>29
<TABLE>


                                           SB PARTNERS
                                    CONSOLIDATED BALANCE SHEETS

<CAPTION>                                                                        December 31,
                                                                             2004             2003
                                                                         ----------------------------
<S>                                                                     <C>              <C>
ASSETS:
  Investments -
      Real estate, at cost
        Land                                                             $ 3,520,842      $ 3,520,842
        Buildings, furnishings and improvements                           35,313,196       34,711,124
        Less - accumulated depreciation                                   (6,719,624)      (5,741,828)
                                                                         -----------      -----------
                                                                          32,114,414       32,490,138

      Real estate held for sale                                           20,221,129       20,747,019
      Investment in joint venture                                          2,813,589        3,100,596
                                                                         -----------      -----------
                                                                          55,149,132       56,337,753
Other assets -
  Cash and cash equivalents                                                  126,361          186,390
  Cash held by lenders in escrow                                             299,199           14,808
  Other                                                                      264,435          388,222
  Other assets in discontinued operations                                    471,098          883,537
                                                                         -----------      -----------
        Total assets                                                     $56,310,225      $57,810,710
                                                                         ===========      ===========
LIABILITIES:
  Mortgage notes payable                                                 $17,124,089      $16,606,614
  Accounts payable and accrued expenses                                      765,973          494,670
  Tenant security deposits                                                   172,807          215,602
  Deferred revenue                                                            23,000                0
  Other liabilities in discontinued operations, including
   $15,904,543 and $16,167,261 of mortgage notes payable, respectively    15,957,511       16,586,603
                                                                         -----------      -----------
        Total liabilities                                                 34,043,380       33,903,489
                                                                         -----------      -----------

PARTNERS' CAPITAL:
  Units of partnership interest without par value;
    Limited partners - 7,753 units                                        22,282,408       23,922,573
    General partner - 1 unit                                                 (15,563)        (15,352)
                                                                         -----------      -----------
        Total partners' capital                                           22,266,845       23,907,221
                                                                         -----------      -----------
        Total liabilities and partners' capital                          $56,310,225      $57,810,710
                                                                         ===========      ===========
<FN>

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






<PAGE>30
<TABLE>

                                                         SB PARTNERS
                                             CONSOLIDATED STATEMENTS OF OPERATIONS

<CAPTION>
                                                                               For The Years Ended December 31,
                                                                            2004             2003              2002
                                                                         -----------      -----------      -----------
<S>                                                                     <C>              <C>              <C>
Revenues:
  Rental income                                                          $ 5,061,601      $ 4,821,837      $ 6,508,531
  Other rental income                                                        558,740          555,480          407,363
  Interest on short-term investments                                           3,774            8,282           40,330
                                                                         -----------      -----------      -----------
      Total revenues                                                       5,624,115        5,385,599        6,956,224
                                                                         -----------      -----------      -----------
Expenses:
  Real estate operating expenses                                           2,668,779        2,484,656        3,151,347
  Interest on mortgage notes payable                                       1,130,777        1,098,702        2,808,457
  Depreciation and amortization                                              993,567        1,053,657        1,069,036
  Real estate taxes                                                          519,196          625,200          580,724
  Management fees                                                            712,845          711,984          794,498
  Other                                                                      156,677          167,059          171,583
                                                                         ------------     -----------      -----------
      Total expenses                                                       6,181,841        6,141,258        8,575,645
                                                                         ------------     -----------      -----------
Loss from operations                                                        (557,726)        (755,659)      (1,619,421)

Equity in net loss of joint venture                                         (317,007)        (238,992)         (92,798)
                                                                         ------------     -----------      -----------
Loss from continuing operations                                             (874,733)        (994,651)      (1,712,219)

Loss from discontinued operations                                           (455,503)        (533,254)        (450,306)

Net gain on sale of investment in real estate
  property, including $379,725 net gain on sale of water rights                    0                0       17,480,880
                                                                         ------------     -----------      -----------
Net income (loss)                                                         (1,330,236)      (1,527,905)      15,318,355

  Income (loss) allocated to general partner                                    (171)           (197)            1,976
                                                                         ------------     -----------      -----------
  Income (loss) allocated to limited partners                            $(1,330,065)     $(1,527,708)     $15,316,379
                                                                         ============     ===========      ===========

Net Income (Loss)
 Per Unit of Limited Partnership Interest                                $      (171)     $      (197)     $     1,976
 (Basic and Diluted)                                                     ============     ===========      ===========


Weighted Average Number of Units of Limited
  Partnership Interest Outstanding                                             7,753           7,753             7,753
                                                                         ===========      ===========      ===========
<FN>

                                            See notes to consolidated financial statements.

</FN>
</TABLE>







<PAGE>31
<TABLE>

                                                     SB PARTNERS

                                          CONSOLIDATED STATEMENTS OF CHANGES IN
                                          PARTNERS' CAPITAL For The Years Ended
                                            December 31, 2004, 2003, and 2002


Limited Partners:
<CAPTION>

                                              Units of
                                            Partnership
                                              Interest             Cumulative       Accumulated
                                       ----------------------         Cash            Earnings
                                       Number       Amount        Distributions       (Losses)         Total
                                       ------    ------------    ---------------    ------------    ------------
<S>                                   <C>       <C>             <C>                <C>             <C>
Balance, January 1, 2002               7,753     $119,968,973    $ (100,170,361)    $(5,013,210)    $14,785,402
    Cash distributions                     0                0          (775,250)              0        (775,250)
    Net income for the year                0                0                 0      15,316,379      15,316,379
                                       -----     ------------    --------------     -----------     -----------
Balance, December 31, 2002             7,753      119,968,973      (100,945,611)     10,303,169      29,326,531
    Cash distributions                     0                0        (3,876,250)              0      (3,876,250)
    Net loss for the year                  0                0                 0      (1,527,708)     (1,527,708)
                                       -----     ------------    --------------     -----------     -----------
Balance, December 31, 2003             7,753      119,968,973      (104,821,861)      8,775,461      23,922,573
    Cash distributions                     0                0          (310,100)              0        (310,100)
    Net loss for the year                  0                0                 0      (1,330,065)     (1,330,065)
                                       -----     ------------    --------------     -----------     -----------
Balance, December 31, 2004             7,753     $119,968,973     $(105,131,961)    $ 7,445,396     $22,282,408
                                       =====     ============    ==============     ===========     ===========


General Partner:
<CAPTION>

                                              Units of
                                            Partnership
                                              Interest             Cumulative       Accumulated
                                       ----------------------         Cash            Earnings
                                       Number       Amount        Distributions       (Losses)         Total
                                       ------    ------------    --------------     ------------    ------------
<S>                                   <C>       <C>             <C>                <C>             <C>
Balance, January 1, 2002                   1          $10,000          $(24,874)        $(1,657)       $(16,531)
    Cash distributions                     0                0              (100)              0            (100)
    Net income for the year                0                0                 0           1,976           1,976
                                       -----     ------------    --------------     -----------     -----------
Balance, December 31, 2002                 1           10,000           (24,974)            319         (14,655)
    Cash distributions                     0                0              (500)              0            (500)
    Net loss for the year                  0                0                 0            (197)           (197)
                                       -----     ------------    --------------     -----------     -----------
Balance, December 31, 2003                 1           10,000           (25,474)            122         (15,352)
    Cash distributions                     0                0               (40)              0             (40)
    Net loss for the year                  0                0                 0            (171)           (171)
                                       -----     ------------    --------------     -----------     -----------
Balance, December 31, 2004                 1          $10,000          $(25,514)        $   (49)       $(15,563)
                                       =====     ============    ==============     ===========     ===========

<FN>


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







<PAGE>32
<TABLE>
                                                     SB PARTNERS
                                           (A New York Limited Partnership)
                                            ------------------------------

                                         CONSOLIDATED STATEMENTS OF CASH FLOWS
                                         ------------------------------------
<CAPTION>
                                                                                For the years Ended December 31,
                                                                         ----------------------------------------------
                                                                             2004             2003             2002
                                                                         ------------     ------------     ------------
<S>                                                                     <C>              <C>              <C>
Cash Flows From Operating Activities:
 Net income (loss)                                                       $(1,330,236)     $(1,527,905)     $15,318,355
  Adjustments to reconcile net income (loss)
   to net cash provided by operating activities:
      Net gain on sale of investment in real estate property,
       including net gain on sale of water rights                                  0                0      (17,480,880)
      Equity in net loss of joint venture                                    317,007          238,992           92,798
      Distributions received from joint venture                                    0           50,000                0
      Depreciation and amortization                                        1,601,822        1,677,294        1,679,854
      Net (increase) decrease in operating assets                            204,735          (94,315)         788,992
      Net increase (decrease) in operating liabilities                      (114,866)         172,337         (132,509)
                                                                         -----------      -----------      -----------
        Net cash provided by operating activities                            678,462          516,403          266,610
                                                                         -----------      -----------      -----------

Cash Flows From Investing Activities:
      Proceeds from sale of investment in
       real estate property, including sale of water rights                        0                0       31,389,975
      Acquisition of real estate property                                          0                0       (4,713,385)
      Investment in joint venture                                            (30,000)          (4,406)      (3,477,980)
      Capital additions to real estate owned                                (653,108)        (676,598)        (723,782)
                                                                         ------------     -----------      -----------
        Net cash provided by (used in) investing activities                 (683,108)        (681,004)      22,474,828
                                                                         ------------     -----------      -----------
Cash Flows From Financing Activities:
      Retirement of mortgage note payable                                          0                0      (19,591,390)
      Repayments of borrowings under revolving
       credit facility                                                             0                0       (4,500,000)
      Borrowings under revolving credit facility                             700,000        2,950,000        3,750,000
      Principal payments on mortgage notes payable                          (445,243)        (415,328)        (565,658)
      Distributions paid to partners                                        (310,140)      (3,876,750)        (775,350)
                                                                         -----------      -----------      -----------
        Net cash used in financing activities                                (55,383)      (1,342,078)     (21,682,398)
                                                                         -----------      -----------       ----------
Net increase (decrease) in cash and cash equivalents                         (60,029)      (1,506,679)       1,059,040

      Cash and cash equivalents at beginning of year                         186,390        1,693,069          634,029
                                                                         -----------      -----------      -----------
      Cash and cash equivalents at end of year                           $   126,361      $   186,390      $ 1,693,069
                                                                         ===========      ===========      ===========

Supplemental disclosure of cash flow information:
      Cash paid during the year for interest                             $ 2,190,765      $ 2,175,439      $ 3,963,237
                                                                         ===========      ===========      ===========
<FN>


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








<PAGE>33

SB PARTNERS
Notes to Consolidated Financial Statements

(1) ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
         SB Partners, a New York limited partnership, and its subsidiaries
         (collectively, the "Partnership"), have been engaged since April 1971
         in acquiring, operating, and holding for investment a varying portfolio
         of real estate interests. SB Partners Real Estate Corporation (the
         "General Partner") serves as the general partner of the Partnership.
         The significant accounting and financial reporting policies of the
         Partnership are as follows:
         (a)    The accompanying consolidated financial statements include the
                accounts of SB Partners and its subsidiaries.  All significant
                intercompany accounts and transactions have been eliminated.
                The consolidated financial statements are prepared using the
                accrual basis of accounting in accordance with accounting
                principles generally accepted in the United States of America.
                Revenues are recognized as earned and expenses are recognized as
                incurred.  The preparation of financial statements in conformity
                with such principles requires management to make estimates and
                assumptions that affect the reported amounts of assets and
                liabilities and disclosure of contingent 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.
         (b)    In connection with the mortgage financing on certain of its
                properties, the Partnership placed the assets and liabilities of
                the properties into single asset limited partnerships, limited
                liability companies or land trusts which hold title to the
                properties. The Partnership has effective control over such
                entities and holds 100% of the beneficial interest. Accordingly,
                the financial statements of these subsidiaries are consolidated
                with those of the Partnership.
         (c)    Depreciation of buildings, furnishings and improvements is
                computed using the straight-line method of depreciation, based
                upon the estimated useful lives of the related properties, as
                follows:
                           Buildings and improvements     5 to 40 years
                           Furnishings                    5 to 7 years
                Investments in real estate are carried at historical cost and
                reviewed periodically for impairment. Expenditures for
                maintenance and repairs are expensed as incurred. Expenditures
                for improvements, renewals and betterments, which increase the
                useful life of the real estate, are capitalized. Upon retirement
                or sale of property, the related cost and accumulated
                depreciation are removed from the accounts. Amortization of
                deferred financing and refinancing costs is computed by
                amortizing the cost on a straight-line basis over the terms of
                the related mortgage notes.
         (d)    Real estate properties are regularly evaluated on a property by
                property basis to determine if it is appropriate to write down
                carrying values to recognize an impairment of value. Impairment
                is determined by calculating the sum of the estimated
                undiscounted future cash flows including the projected
                undiscounted future net proceeds from the sale of the property.
                In the event such sum is less than the net carrying value of the
                property, the property will be written down to estimated fair
                value. Based on the Partnership's long-term hold strategy for
                its investments in real estate, the carrying value of its
                properties at December 31, 2004 is estimated to be fully
                realizable.
         (e)    Real estate held for sale is carried at the lower of cost or
                fair value less selling costs. Upon determination that a
                property is held for sale, depreciation of such property is no
                longer recorded.
         (f)    For financial reporting purposes, the Partnership considers all
                highly liquid, short-term investments with maturities of three
                months or less when purchased to be cash equivalents.
         (g)    The Partnership accounts for its investment in joint venture
                under the equity method of accounting as the Partnership
                exercises significant influence, but not control, over the joint
                venture.
         (h)    Deferred revenue represents amounts received under a contract
                that are recognized as earned over the contract period.






<PAGE>34

         (i)    Tenant leases at the residential properties generally have terms
                of one year or less. Rental income at the residential properties
                is recognized when earned pursuant to the terms of the leases
                with tenants. Tenant leases at the industrial flex property have
                terms that exceed one year. Rental income at the industrial flex
                property is recognized on a straight-line basis over the terms
                of the leases.
         (j)    Gains on sales of investments in real estate are recognized in
                accordance with accounting principles generally accepted in the
                United States of America applicable to sales of real estate
                which require minimum levels of initial and continuing
                investment by the purchaser, and certain other tests be met,
                prior to the full recognition of profit at the time of the sale.
                When the tests are not met, gains on sales are recognized on
                either the installment or cost recovery methods.
         (k)    Each partner is individually responsible for reporting its share
                of the Partnership's taxable income or loss. Accordingly, no
                provision has been made in the accompanying consolidated
                financial statements for Federal, state or local income taxes.
         (l)    Net income (loss) per unit of partnership interest has been
                computed based on the weighted average number of units of
                partnership interest outstanding during each year. There were no
                potentially dilutive securities outstanding during each year.
         (m)    The Partnership is engaged in only one industry segment, real
                estate investment, and therefore information regarding industry
                segments is not applicable and is not included in these
                consolidated financial statements.
         (n)    On January 1, 2002, the Partnership adopted Statement of
                Financial Accounting Standards ("SFAS") No. 144, "Accounting for
                the Impairment or Disposal of Long-Lived Assets" (the
                "Statement"). The Statement requires the operations related to
                properties that have been sold or properties that are intended
                to be sold within one year, be presented as discontinued
                operations in the statements of operations for all periods
                presented, and that properties intended to be sold be designated
                as "held for sale" on the balance sheet.
         (o)    In April 2002, the Financial Accounting Standards Board ("FASB")
                issued SFAS No. 145, "Rescission of SFAS No. 4, 22 and 64,
                Amendment of SFAS No. 13 and Technical Corrections". SFAS No.
                145, among other things, rescinds SFAS No. 4, "Reporting Gains
                and Losses from Extinguishment of Debt", and accordingly, the
                reporting of gains or losses from the early extinguishment of
                debt as extraordinary items will only be required if they meet
                the specific criteria for extraordinary items included in
                Accounting Principles Board Opinion No. 30, "Reporting the
                Results of Operations". Although the rescission of SFAS No. 4
                was mandatory as of January 1, 2003, management elected to adopt
                SFAS No. 145 in 2002.
         (p)    Certain prior year amounts have been reclassified to conform
                with the current year presentation.






<PAGE>35

(2) INVESTMENT MANAGEMENT AGREEMENT
         The Partnership entered into a management agreement with the General
         Partner. Under the terms of this agreement, the General Partner is
         responsible for the acquisition, management and disposition of all
         investments, as well as performance of the day-to-day administrative
         operations and provision of office space for the Partnership.

         For these services, the General Partner receives a management fee equal
         to 2% of the average amount of capital invested in real estate plus
         cumulative mortgage amortization payments, and 0.5% of capital not
         invested in real estate, as defined in the partnership agreement. The
         management fee amounted to $712,845, $711,984, and $794,498 for the
         years ended December 31, 2004, 2003, and 2002, respectively. In
         addition, the General Partner is entitled to 25% of cash distributions
         in excess of the annual distribution preference, as defined in the
         partnership agreement. No such amounts were due for the years ended
         December 31, 2004, 2003 or 2002.


(3) INVESTMENTS IN REAL ESTATE
         As of December 31, 2004 and 2003, the Partnership owned apartment
         projects in St. Louis, Missouri; Greenville, South Carolina; and
         Holiday and Orlando, Florida; as well as an industrial flex property in
         Maple Grove, Minnesota and 13.9 acres of land in Holiday, Florida. The
         following is the cost basis and accumulated depreciation of the real
         estate investments owned by the Partnership as of December 31, 2004 and
         2003:

<TABLE>
<CAPTION>
                                                                 Real Estate at Cost
                         No.of    Year of                    ---------------------------
Type                     Prop.  Acquisition   Description     12/31/04         12/31/03
----                     -----  -----------   -----------    -----------     -----------
<S>                       <C>    <C>         <C>                 <C>              <C>
Residential properties     3      1991-99     682 Apts.      $34,025,199     $33,425,916
Industrial flex property   1      2002        60,345 sf        4,764,452       4,761,663
Undeveloped land           1      1978        13.9 Acres          44,387          44,387
                                                             -----------     -----------
Total cost                                                    38,834,038      38,231,966
Less: accumulated depreciation                                (6,719,624)     (5,741,828)
                                                             -----------     -----------
                                                              32,114,414      32,490,138

Real estate held for sale                                     20,221,129      20,747,019
                                                             -----------     -----------

Net book value                                               $52,335,543     $53,237,157
                                                             ===========     ===========
</TABLE>






<PAGE>36

(4) REAL ESTATE HELD FOR SALE

         Cypress Key Apartments has been designated as real estate property held
         for sale as of October 19, 2004. As such, this investment is
         reflected as real estate property held for sale on the accompanying
         consolidated balance sheets. Other assets and the liabilities of this
         property are reflected as other assets and liabilities in discontinued
         operations on the accompanying consolidated balance sheets. The results
         of operations from the property are reflected as loss from discontinued
         operations in the accompanying consolidated statement of operations.
         The various components of revenue and expenses from discontinued
         operations for the years ended December 31, 2004, 2003 and 2002 are as
         follows:



                                           2004          2003          2002
                                           ----          ----          ----

            Operating revenue           $2,889,710    $2,802,310    $2,914,689

            Operating expenses           3,345,213     3,335,564     3,364,995
                                        ----------    ----------    ----------

            Loss from discontinued
             operations                  ($455,503)    ($533,254)    ($450,306)
                                        ==========    ==========    ==========



(5)      INVESTMENT IN JOINT VENTURE

         The following are the condensed financial statements (000's omitted) of
         the joint venture as of and for the years ended December 31, 2004 and
         2003:

                                        BALANCE SHEETS
                                                 2004        2003
                                                 ----        ----
         Investment in real estate, net        $ 17,436    $ 17,826
         Current assets                             365         521
         Mortgage note payable                  (13,871)    (14,012)
         Current liabilities                       (402)       (418)
                                               --------    --------
           Venturers' capital                  $  3,528    $  3,917
                                               ========    ========

                                   STATEMENTS OF OPERATIONS

                                                 2004        2003        2002
                                                 ----        ----        ----
         Rent and other income                 $  2,930    $  2,825    $  1,992
         Real estate operating expenses,
          before depreciation and amortization   (2,864)     (2,658)     (1,804)
         Depreciation and amortization             (495)       (485)       (314)
                                               --------    --------    --------
           Net loss                            $   (429)   $   (318)   $   (126)
                                               ========    ========    ========

         The joint venture has experienced recurring losses from operations and
         current operating cash flow is insufficient to fund property operations
         and contractual debt service payments on the mortgage note. Management
         believes that such cash flow shortfalls are temporary as a result of
         soft local market conditions and is currently evaluating alternatives
         to generate additional funds required to cover the shortfall.






<PAGE>37

(6) MORTGAGE NOTES PAYABLE
       Mortgage notes payable consist of the following non-recourse first liens:
<TABLE>
<CAPTION>
                                                                        Net Carrying Amount
                                            Annual                          December 31,
                   Interest  Maturity    Installment    Amount Due    -------------------------
Property             Rate      Date      Payments(a)    at Maturity      2004          2003
-----------------------------------------------------------------------------------------------
<S>               <C>       <C>        <C>             <C>           <C>           <C>
Halton Place(b)    4.340%    09/05      Interest Only   $3,900,000    $ 3,900,000   $ 3,200,000

Holiday Park       6.895%    02/08        300,169        3,277,785      3,468,112     3,526,935

Le Coeur du Monde  7.805%    10/09        890,447        9,075,763      9,755,977     9,879,679
                                                                      -----------   -----------
                                                                       17,124,089    16,606,614

Other liabilities in discontinued operations
Cypress Key        6.605%    01/09      1,322,707       14,772,418     15,904,543    16,167,261
                                                                      -----------   -----------

                                                                      $33,028,632   $32,773,875
                                                                      ===========   ===========

<FN>
(a) Annual installment payments include principal and interest. Scheduled
principal payments on mortgage notes payable are $4,377,325 for 2005; $511,732
for 2006; $548,635 for 2007; $3,746,722 for 2008 and $23,844,218 for 2009.
Scheduled principal payments on the mortgage note payable included in other
liabilities from discontinued operations are $280,606 for 2005; $299,712 for
2006; $320,118 for 2007; $312,553 for 2008 and $14,691,554 for 2009.

(b) On March 1, 2001, the Partnership entered into a revolving credit facility
agreement with a bank in the amount of $7,500,000, which is secured by Halton
Place Apartments. The credit facility was for a term of two years, which has
been extended to September 1, 2005. Borrowings bear interest at LIBOR plus
1.95%. The agreement requires the Partnership to maintain a ratio of NOI, as
defined, to actual debt service, as defined, of 1.2 to 1. As of December 31,
2004, the Partnership is in compliance with the covenant. In connection with
this credit facility, the Partnership is subject to market risk relating to
potential future changes in interest rates. </FN> </TABLE>


(7)      QUARTERLY FINANCIAL INFORMATION - UNAUDITED

                                                            Earnings
                                Revenues(1)    Net Loss     Per Unit
                                ----------    ----------    --------

Year Ended December 31, 2004
----------------------------

First Quarter                   $1,380,210    $(402,152)    $(51.86)
Second Quarter                   1,377,207     (256,814)     (33.12)
Third Quarter                    1,427,376     (251,871)     (32.48)
Fourth Quarter                   1,439,322     (419,399)     (54.09)



Year Ended December 31, 2003
----------------------------

First Quarter                   $1,358,434    $(346,829)    $(44.73)
Second Quarter                   1,320,685     (401,974)     (51.84)
Third Quarter                    1,361,380     (340,967)     (43.98)
Fourth Quarter                   1,345,100     (438,135)     (56.51)



(1) Amounts have been adjusted to give effect to the reclassification from
    revenues to discontinued operations for Cypress Key Apartments, which has
    been designated as held for sale.






<PAGE>38

(8) FEDERAL INCOME TAX INFORMATION (UNAUDITED)
         A reconciliation of net income (loss) for financial reporting purposes
         to net income (loss) for Federal income tax reporting purposes is as
         follows:
<TABLE>
<CAPTION>
                                                                      For the Years Ended December 31,
                                                                    2004            2003           2002
                                                                 -----------    -----------    -----------
<S>                                                             <C>            <C>            <C>
Net income (loss) for financial reporting purposes               $(1,330,236)   $(1,527,905)   $15,318,355
Adjustment to net gain on sale of investment in real estate
   property to reflect differences between tax and financial
   reporting bases of assets and liabilities sold                          0              0      6,837,298
Difference between tax and financial statement equity in net
   loss of joint venture                                            (296,701)      (175,056)         1,113
Difference between tax and financial statement depreciation         (288,631)       (70,510)      (179,218)
                                                                 -----------    -----------    -----------
Net income (loss) for Federal income tax reporting purposes      $(1,915,568)   $(1,773,471)   $21,977,548
                                                                 ===========    ===========    ===========

Net ordinary loss
   for Federal income tax reporting purposes:                    $(1,915,568)   $(1,773,471)   $(2,340,630)
Net capital (Sec. 1231) gain
   for Federal income tax reporting purposes:                              0              0     24,318,178
                                                                 -----------    -----------    -----------
                                                                 $(1,915,568)   $(1,773,471)   $21,977,548
                                                                 ===========    ===========    ===========
Weighted average number of units of limited partnership
   interest outstanding                                                7,753          7,753          7,753
                                                                 ===========    ===========    ===========
</TABLE>

         As of December 31, 2004 and 2003, the tax bases of the Partnership's
         assets and liabilities were approximately $57,543,000 and $59,953,000
         of assets, and $34,043,000 and $34,417,000 of liabilities,
         respectively.


(9) MANAGEMENT SERVICES
         Certain affiliates of the General Partner oversee the management and
         operation of various real estate properties, including those owned by
         the Partnership. Services performed by affiliates are billed at actual
         or allocated cost, percentage of revenues or net equity. For the years
         ended December 31, 2004, 2003 and 2002 billings to the Partnership
         amounting to $472,792, $460,562, and $543,392, respectively, are
         included in real estate operating expenses. For the years ended
         December 31, 2004, 2003 and 2002 billings to the partnership which
         relate to Cypress Key Apartments, amounting to $144,487, $140,115, and
         $145,739, respectively, are included in loss from discontinued
         operations.

         In connection with the mortgage financing of certain properties, the
         respective lenders required the Partnership to place the assets and
         liabilities of these properties into single asset limited partnerships
         which hold title to these properties. A trust company affiliated with
         the General Partner holds the general partner interest in each single
         asset limited partnership as trustee for the Partnership. For its
         services, the affiliate is paid an annual fee, which aggregated
         $42,800, 25,824, and $47,580 in 2004, 2003, 2002, respectively, and is
         based upon the trust company's standard rate schedule.







<PAGE>39


(10) FAIR VALUE OF FINANCIAL INSTRUMENTS
         The Partnership's financial instruments include cash, cash equivalents
         and mortgage notes payable. The carrying amount of the cash and cash
         equivalents are reasonable estimates of fair value. Mortgage notes
         payable have been valued by discounting future payments required under
         the terms of the obligations at rates currently available to the
         Partnership for debt with similar maturities, terms and underlying
         collateral. The fair value of the mortgage notes payable is estimated
         to be $32,117,425 and $31,542,142 at December 31, 2004 and 2003,
         respectively. These amounts include the fair value of mortgage note
         payable related to Cypress Key Apartments of $15,033,772 and
         $15,093,730 for December 31, 2004 and 2003.


(11) COMMITMENTS AND CONTINGENCIES
         The Partnership is a party to certain actions directly arising from its
         normal business operations. While the ultimate outcome is not presently
         determinable with certainty, the Partnership believes that the
         resolution of these matters will not have a material adverse effect on
         its financial statements.

         The Partnership leases its properties to tenants under operating lease
         agreements, certain of which require tenants at the industrial flex
         property to pay all or part of certain operating and other expenses of
         the property. The minimum future rentals to be received in respect of
         non-cancelable commercial operating leases with unexpired terms in
         excess of one year as of December 31, 2004 are $446,706 for 2005;
         $446,706 for 2006; $446,706 for 2007; and $73,167 for 2008.

(12) SUBSEQUENT EVENT
         On March 1, 2005, the Partnership made a distribution of $40 per unit,
         totaling $310,140, to Unitholders of record as of December 31, 2004.




PAGE>40

<TABLE>
 SB PARTNERS
 SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
 DECEMBER 31, 2004
<CAPTION>
                  Column A             Column B                    Column C                       Column D
                                                         Initial Cost to the Registrant             Costs
                                                    ----------------------------------------     Capitalized
                                                                 Buildings and                  Subsequent to
                Description          Encumbrances      Land      Improvements      Total         Acquisition
<S>                                 <C>           <C>            <C>            <C>             <C>
MULTI FAMILY RESIDENTIAL
  Florida -
   Holiday (Holiday Park -
      including undeveloped land)    $ 3,468,112    $  458,342    $ 4,043,354    $ 4,501,696     $1,335,519
  South Carolina -
   Greenville (Halton Place)           3,900,000     1,260,000     11,364,343     12,624,343      1,307,251
  Missouri -
   St. Louis (Le Coeur du Monde)       9,755,977     1,332,500     12,039,635     13,372,135        928,642
                                     -----------    ----------    -----------    -----------     ----------
                                      17,124,089     3,050,842     27,447,332     30,498,174      3,571,412

INDUSTRIAL FLEX
  Minnesota -
   Maple Grove (Eagle Lake IV)           N/a           470,000      4,243,385      4,713,385         51,067

REAL ESTATE HELD FOR SALE
  Florida-
   Orlando (Cypress Key)              15,904,543     2,260,000     20,404,725     22,664,725      1,169,036

                                     -----------    ----------    -----------    -----------     ----------
                                     $33,028,632    $5,780,842    $52,095,442    $57,876,284     $4,791,515
                                     ===========    ==========    ===========    ===========     ==========

</TABLE>
<page>40
<TABLE>
 SB PARTNERS
 SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
 DECEMBER 31, 2004
<CAPTION>

                  Column A                          Column E                       Column F

                                              Gross amount at which
                                                Carried at End of
                                                Year (Notes a & c)
                                                                                 Accumulated
                                                   Buildings and                 Depreciation
                Description             Land       Improvements      Total       (Notes b & d)
<S>                                 <C>           <C>            <C>            <C>
MULTI FAMILY RESIDENTIAL
  Florida -
   Holiday (Holiday Park -
    including undeveloped land)      $  458,342    $ 5,378,873    $ 5,837,215    $ 2,653,080
  South Carolina -
   Greenville (Halton Place)          1,260,000     12,671,594     13,931,594      1,984,772
  Missouri -
   St. Louis (Le Coeur du Monde)      1,332,500     12,968,277     14,300,777      1,797,779
                                     ----------    -----------    -----------    -----------
                                      3,050,842     31,018,744     34,069,586      6,435,631

INDUSTRIAL FLEX
  Minnesota -
   Maple Grove (Eagle Lake IV)          470,000      4,294,452      4,764,452        283,993

REAL ESTATE HELD FOR SALE
  Florida -
   Orlando (Cypress Key)              2,260,000     21,573,761     23,833,761      3,612,632

                                     ----------    -----------    -----------    -----------
                                     $5,780,842    $56,886,957    $62,667,799    $10,332,256
                                     ==========    ===========    ===========    ===========

</TABLE>






<PAGE>41

<TABLE>
 SB PARTNERS
 SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
 DECEMBER 31, 2004
<CAPTION>

                  Column A            Column G      Column H        Column I

                                                                  Life on which
                                                                 Depreciation in
                                                                Latest Statement
                                       Date of        Date       of Operations
                Description         Construction    Acquired      is Computed
<S>                                 <S>           <S>            <S>
MULTI FAMILY RESIDENTIAL
  Florida -
   Holiday (Holiday Park -
    including undeveloped land)      1972 - 1975   Jan 1991       7 to 30 years
   Orlando (Cypress Key)             1988          Aug 1998       7 to 40 years
  South Carolina -
   Greenville (Halton Place)         1986          Dec 1998       7 to 40 years
  Missouri -
   St. Louis (Le Coeur du Monde)     1988-1989     Sept 1999      7 to 40 years

Minnesota -
   Maple Grove (Eagle Lake IV)       2000          Jun 2002       7 to 39 years

</FN>
</TABLE>

<TABLE>
     NOTES TO SCHEDULE III:
<CAPTION>
                                                       2004           2003           2002
                                                    -----------    -----------    -----------
<S>                                                <C>            <C>            <C>
 (a) Reconciliation of amounts shown in Column E:
       Balance at beginning of year                 $62,014,691    $61,338,093    $69,810,021
       Additions -

         Acquisitions                                         0              0      4,713,385
         Cost of improvements                           653,108        676,598        723,782

       Deductions -
         Sales                                                0              0    (13,909,095)

                                                    -----------    -----------    -----------
       Balance at end of year                       $62,667,799    $62,014,691    $61,338,093
                                                    ===========    ===========    ===========

 (b) Reconciliation of amounts shown in Column F:
       Balance at beginning of year                 $ 8,777,534    $ 7,166,894    $ 5,641,349
       Additions -
         Depreciation expense for year                1,554,722      1,610,640      1,525,545

       Deductions -

                                                    -----------    -----------    -----------
       Balance at end of year                       $10,332,256    $ 8,777,534    $ 7,166,894
                                                    ===========    ===========    ===========
 (c) Aggregate cost basis for Federal
       income tax reporting purposes                $62,861,672    $62,208,559    $61,531,952
                                                    ===========    ===========   ============
 (d) Accumulated depreciation for Federal
       income tax reporting purposes                $10,620,887    $ 8,870,403    $ 7,189,253
                                                    ===========    ===========   ============
</TABLE>