FHLMC Loan No. 002726165

                                MULTIFAMILY NOTE
                     (MULTISTATE - REVISION DATE 11-01-2000)

US $8,350,000.00                                         As of February 22, 2001

   FOR VALUE RECEIVED,  the undersigned  ("Borrower")  jointly and severally (if
more than  one)  promises  to pay to the order of  NorthMarq  Capital,  Inc.,  a
Minnesota  corporation,  the  principal sum of Eight Million Three Hundred Fifty
Thousand  and No/100  Dollars  (US  $8,350,000.00)  with  interest on the unpaid
principal  balance at the annual rate of six and ninety-one  hundredths  percent
(6.91%).

   1.  Defined  Terms.  As used in this Note,  (i) the term  "Lender"  means the
holder of this Note,  and (ii) the term  "Indebtedness"  means the principal of,
interest  on,  and any other  amounts  due at any time  under,  this  Note,  the
Security Instrument or any other Loan Document,  including  prepayment premiums,
late  charges,  default  interest,  and  advances to protect the security of the
Security  Instrument  under  Section 12 of the  Security  Instrument.  "Event of
Default"  and other  capitalized  terms used but not  defined in this Note shall
have the meanings given to such terms in the Security Instrument.

   2. Address for Payment.  All payments due under this Note shall be payable at
3500 West 80th Street,  Suite 500,  Minneapolis,  Minnesota,  55431-4435 or such
other place as may be designated by written notice to Borrower from or on behalf
of Lender.

   3. Payment of Principal and Interest. Principal and interest shall be paid as
follows:

   (a) Unless  disbursement  of  principal  is made by Lender to Borrower on the
first  day of the  month,  interest  for the  period  beginning  on the  date of
disbursement and ending on and including the last day of the month in which such
disbursement is made shall be payable  simultaneously with the execution of this
Note.  Interest under this Note shall be computed on the basis of a 360-day year
consisting of twelve 30-day months.

   (b) Consecutive monthly  installments of interest only, each in the amount of
Forty-eight  Thousand  Eighty-two  and 09/100 Dollars (US  $48,082.09)  shall be
payable on the first day of each  month  beginning  on April 1, 2001,  until the
entire unpaid principal balance evidenced by this Note is fully paid.

   (c) Any  accrued  interest  remaining  past due for 30 days or more  may,  at
Lender's discretion, be added to and become part of the unpaid principal balance
and shall bear  interest at the rate or rates  specified  in this Note,  and any
reference below to "accrued  interest" shall refer to

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<PAGE>

accrued interest which has not become part of the unpaid principal balance.  Any
remaining principal and interest shall be due and payable on March 1, 2008 or on
any earlier date on which the unpaid principal  balance of this Note becomes due
and payable,  by  acceleration  or otherwise (the "Maturity  Date").  The unpaid
principal balance shall continue to bear interest after the Maturity Date at the
Default Rate set forth in this Note until and  including the date on which it is
paid in full.

   (d) Any regularly  scheduled  monthly  installment  of principal and interest
that is  received  by Lender  before  the date it is due shall be deemed to have
been  received on the due date solely for the  purpose of  calculating  interest
due.

   4. Application of Payments. If at any time Lender receives,  from Borrower or
otherwise,  any amount  applicable  to the  Indebtedness  which is less than all
amounts due and payable at such time,  Lender may apply that  payment to amounts
then due and  payable in any manner and in any order  determined  by Lender,  in
Lender's  discretion.  Borrower  agrees that neither  Lender's  acceptance  of a
payment  from  Borrower in an amount that is less than all amounts  then due and
payable nor Lender's  application of such payment shall  constitute or be deemed
to  constitute  either  a  waiver  of  the  unpaid  amounts  or  an  accord  and
satisfaction.

   5.  Security.   The  Indebtedness  is  secured,  among  other  things,  by  a
multifamily mortgage,  deed to secure debt or deed of trust dated as of the date
of this Note (the "Security Instrument"),  and reference is made to the Security
Instrument for other rights of Lender as to collateral for the Indebtedness.

   6. Acceleration.  If an Event of Default has occurred and is continuing,  the
entire unpaid principal  balance,  any accrued interest,  the prepayment premium
payable under  Paragraph  10, if any, and all other  amounts  payable under this
Note and any other Loan  Document  shall at once become due and payable,  at the
option of Lender,  without  any prior  notice to  Borrower  (except if notice is
required by applicable  law,  then after such notice).  Lender may exercise this
option to accelerate regardless of any prior forbearance.

   7. Late Charge.  If any monthly  amount  payable under this Note or under the
Security  Instrument or any other Loan Document is not received by Lender within
ten (10) days after the amount is due (unless  applicable  law requires a longer
period of time before a late  charge may be imposed,  in which event such longer
period shall be  substituted),  Borrower  shall pay to Lender,  immediately  and
without  demand by Lender,  a late  charge  equal to five  percent  (5%) of such
amount  (unless  applicable  law requires a lesser  amount be charged,  in which
event such lesser amount shall be substituted).  Borrower  acknowledges that its
failure to make timely payments will cause Lender to incur  additional  expenses
in servicing and processing  the loan  evidenced by this Note (the "Loan"),  and
that it is extremely  difficult and  impractical to determine  those  additional
expenses.  Borrower  agrees  that  the  late  charge  payable  pursuant  to this
Paragraph  represents a fair and  reasonable  estimate,  taking into account all
circumstances  existing  on the date of this Note,  of the  additional  expenses
Lender will incur by reason of such

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<PAGE>

late payment. The late charge is payable in addition to, and not in lieu of, any
interest  payable at the Default Rate  pursuant to Paragraph 8.

   8.  Default  Rate.  So long as (a) any  monthly  installment  under this Note
remains past due for thirty (30) days or more, or (b) any other Event of Default
has occurred  and is  continuing,  interest  under this Note shall accrue on the
unpaid  principal  balance  from the earlier of the due date of the first unpaid
monthly  installment  or the  occurrence  of such  other  Event of  Default,  as
applicable,  at a rate  (the  "Default  Rate")  equal to the  lesser of four (4)
percentage  points above the rate stated in the first paragraph of this Note and
the maximum  interest rate which may be collected from Borrower under applicable
law. If the unpaid  principal  balance and all accrued  interest are not paid in
full on the Maturity Date, the unpaid principal balance and all accrued interest
shall bear interest  from the Maturity  Date at the Default Rate.  Borrower also
acknowledges that its failure to make timely payments will cause Lender to incur
additional  expenses in servicing and processing the Loan, that, during the time
that any monthly  installment under this Note is delinquent for more than thirty
(30) days, Lender will incur additional costs and expenses arising from its loss
of the use of the money due and from the adverse  impact on Lender's  ability to
meet  its  other   obligations  and  to  take  advantage  of  other   investment
opportunities,  and that it is extremely  difficult and impractical to determine
those additional costs and expenses. Borrower also acknowledges that, during the
time that any monthly  installment  under this Note is delinquent  for more than
thirty (30) days or any other Event of Default has occurred  and is  continuing,
Lender's risk of nonpayment of this Note will be materially increased and Lender
is entitled to be compensated for such increased risk.  Borrower agrees that the
increase in the rate of  interest  payable  under this Note to the Default  Rate
represents a fair and reasonable estimate, taking into account all circumstances
existing on the date of this Note, of the additional  costs and expenses  Lender
will incur by reason of the  Borrower's  delinquent  payment and the  additional
compensation Lender is entitled to receive for the increased risks of nonpayment
associated with a delinquent loan.

   9. Limits on Personal Liability.

   (a) Except as otherwise  provided in this Paragraph 9, Borrower shall have no
personal  liability  under this Note, the Security  Instrument or any other Loan
Document for the repayment of the  Indebtedness  or for the  performance  of any
other  obligations  of Borrower  under the Loan  Documents,  and  Lender's  only
recourse for the  satisfaction of the  Indebtedness  and the performance of such
obligations  shall be Lender's  exercise of its rights and remedies with respect
to the Mortgaged  Property and any other  collateral  held by Lender as security
for the Indebtedness. This limitation on Borrower's liability shall not limit or
impair  Lender's  enforcement  of  its  rights  against  any  guarantor  of  the
Indebtedness or any guarantor of any obligations of Borrower.

   (b)  Borrower  shall be  personally  liable to Lender for the  repayment of a
portion of the Indebtedness equal to zero percent (0%) of the original principal
balance of this Note,  plus any other  amounts for which  Borrower  has personal
liability under this Paragraph 9.

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<PAGE>

   (c) In  addition to  Borrower's  personal  liability  under  Paragraph  9(b),
Borrower  shall be  personally  liable to Lender for the  repayment of a further
portion of the Indebtedness  equal to any loss or damage suffered by Lender as a
result of (1) failure of Borrower to pay to Lender upon demand after an Event of
Default all Rents to which Lender is entitled under Section 3(a) of the Security
Instrument  and the amount of all security  deposits  collected by Borrower from
tenants  then in  residence;  (2)  failure of  Borrower  to apply all  insurance
proceeds and condemnation  proceeds as required by the Security  Instrument;  or
(3)  failure of Borrower to comply  with  Section  14(d) or (e) of the  Security
Instrument relating to the delivery of books and records, statements,  schedules
and reports.

   (d) For purposes of determining Borrower's personal liability under Paragraph
9(b) and Paragraph  9(c), all payments made by Borrower or any guarantor of this
Note with respect to the  Indebtedness  and all amounts  received by Lender from
the  enforcement  of its rights under the Security  Instrument  shall be applied
first to the  portion of the  Indebtedness  for which  Borrower  has no personal
liability.

   (e) Borrower  shall become  personally  liable to Lender for the repayment of
all of the  Indebtedness  upon the occurrence of any of the following  Events of
Default: (1) Borrower's acquisition of any property or operation of any business
not  permitted  by  Section  33 of  the  Security  Instrument;  (2)  a  Transfer
(including,  but not  limited  to,  a lien or  encumbrance)  that is an Event of
Default  under  Section  21 of the  Security  Instrument,  other than a Transfer
consisting  solely of the  involuntary  removal or  involuntary  withdrawal of a
general  partner in a limited  partnership  or a manager in a limited  liability
company; or (3) fraud or written material  misrepresentation  by Borrower or any
officer,  director,  partner,  member or employee of Borrower in connection with
the  application  for or  creation  of the  Indebtedness  or any request for any
action or consent by Lender.

   (f) In addition to any  personal  liability  for the  Indebtedness,  Borrower
shall  be  personally  liable  to  Lender  for  (1)  the  performance  of all of
Borrower's  obligations under Section 18 of the Security Instrument (relating to
environmental  matters);  (2) the costs of any audit under  Section 14(d) of the
Security  Instrument;  and (3) any  costs  and  expenses  incurred  by Lender in
connection  with the  collection of any amount for which  Borrower is personally
liable under this  Paragraph  9,  including  fees and out of pocket  expenses of
attorneys and expert witnesses and the costs of conducting any independent audit
of Borrower's  books and records to determine the amount for which  Borrower has
personal liability.

   (g) To the extent that Borrower has personal  liability  under this Paragraph
9, Lender may exercise its rights against Borrower  personally without regard to
whether  Lender has exercised any rights  against the Mortgaged  Property or any
other  security,  or pursued any rights  against any  guarantor,  or pursued any
other rights available to Lender under this Note, the Security  Instrument,  any
other Loan  Document or  applicable  law. For purposes of this  Paragraph 9, the
term "Mortgaged Property" shall not include any funds that (1) have been applied
by

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<PAGE>

Borrower  as required  or  permitted  by the  Security  Instrument  prior to the
occurrence  of an  Event of  Default  or (2)  Borrower  was  unable  to apply as
required  or  permitted  by the  Security  Instrument  because of a  bankruptcy,
receivership, or similar judicial proceeding. To the fullest extent permitted by
applicable  law, in any action to enforce  Borrower's  personal  liability under
this  Paragraph  9,  Borrower  waives  any  right  to set off the  value  of the
Mortgaged Property against such personal liability.

   10. Voluntary and Involuntary Prepayments.

   (a) A prepayment  premium shall be payable in connection  with any prepayment
(any receipt by Lender of principal, other than principal required to be paid in
monthly installments pursuant to Paragraph 3(b), prior to the scheduled Maturity
Date set forth in Paragraph 3(c)) under this Note as provided below:

      (1) Borrower may voluntarily prepay all of the unpaid principal balance of
this Note on a Business  Day  designated  as the date for such  prepayment  in a
written  notice from Borrower to Lender given at least 30 days prior to the date
of such  prepayment.  Such prepayment  shall be made by paying (A) the amount of
principal being prepaid, (B) all accrued interest, (C) all other sums due Lender
at the  time of such  prepayment,  and (D)  the  prepayment  premium  calculated
pursuant to Paragraph 10(c). For all purposes including the accrual of interest,
any prepayment received by Lender on any day other than the last calendar day of
the month shall be deemed to have been received on the last calendar day of such
month.  For purposes of this Note,  a "Business  Day" means any day other than a
Saturday,  Sunday  or any other  day on which  Lender is not open for  business.
Unless expressly provided for in the Loan Documents, Borrower shall not have the
option to  voluntarily  prepay  less than all of the unpaid  principal  balance.
However,  if a partial  prepayment  is provided for in the Loan  Documents or is
accepted by Lender in  Lender's  discretion,  a  prepayment  premium  calculated
pursuant to Paragraph 10(c) shall be due and payable by Borrower.

      (2) Upon Lender's  exercise of any right of acceleration  under this Note,
Borrower shall pay to Lender, in addition to the entire unpaid principal balance
of this  Note  outstanding  at the  time of the  acceleration,  (A) all  accrued
interest  and  all  other  sums  due  Lender,  and (B)  the  prepayment  premium
calculated pursuant to Paragraph 10(c).

      (3) Any  application  by Lender of any collateral or other security to the
repayment of any portion of the unpaid  principal  balance of this Note prior to
the  Maturity  Date and in the absence of  acceleration  shall be deemed to be a
partial prepayment by Borrower, requiring the payment to Lender by Borrower of a
prepayment premium.

   (b)  Notwithstanding the provisions of Paragraph 10(a), no prepayment premium
shall be payable with respect to (A) any prepayment  made during the period from
one  hundred  eighty  (180)  days  before  the  scheduled  Maturity  Date to the
scheduled  Maturity  Date,  or (B) any

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<PAGE>

prepayment occurring as a result of the application of any insurance proceeds or
condemnation award under the Security Instrument.

   (c) Any  prepayment  premium  payable  under this Note shall be  computed  as
follows:

      (1) If the  prepayment  is made between the date of this Note and the date
that is  seventy-eight  (78)  months  after the first day of the first  calendar
month  following  the date of this Note (the "Yield  Maintenance  Period"),  the
prepayment  premium shall be whichever is the greater of  subparagraphs  (i) and
(ii) below:

         (i) 1.0% of the unpaid principal balance of this Note; or

         (ii) the product obtained by multiplying:

              (A) the amount of principal being prepaid,

              by

              (B) the excess (if any) of the Monthly  Note Rate over the Assumed
                  Reinvestment Rate,

              by

              (C) the Present Value Factor.

         For purposes of  subparagraph  (ii),  the following  definitions  shall
         apply:

         Monthly Note Rate:  one-twelfth  (1/12) of the annual  interest rate of
         this Note, expressed as a decimal calculated to five digits.

         Prepayment  Date:  in the case of a voluntary  prepayment,  the date on
         which the prepayment is made; in the case of the  application by Lender
         of collateral or security to a portion of the  principal  balance,  the
         date of such  application;  and in any  other  case,  the date on which
         Lender accelerates the unpaid principal balance of this Note.

         Assumed  Reinvestment Rate:  one-twelfth (1/12) of the yield rate as of
         the date 5 Business Days before the Prepayment Date, on the 6.125% U.S.
         Treasury  Security  due August 1, 2007,  as reported in The Wall Street
         Journal, expressed as a decimal calculated to five digits. In the event
         that no yield is  published  on the  applicable  date for the  Treasury
         Security used to determine the Assumed  Reinvestment  Rate,  Lender, in
         its  discretion,   shall  select  the  non-callable  Treasury  Security
         maturing in the same year as the Treasury Security specified above with
         the  lowest  yield  published  in The  Wall  Street  Journal  as of the
         applicable  date.  If the  publication  of such yield rates in The Wall
         Street Journal is  discontinued  for any reason,  Lender shall select a
         security with a comparable rate and term to the Treasury  Security used
         to  determine  the  Assumed

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<PAGE>

         Reinvestment  Rate. The selection of an alternate  security pursuant to
         this Paragraph shall be made in Lender's discretion

         Present  Value Factor:  the factor that  discounts to present value the
         costs  resulting to Lender from the difference in interest rates during
         the months remaining in the Yield Maintenance Period, using the Assumed
         Reinvestment  Rate as the  discount  rate,  with  monthly  compounding,
         expressed numerically as follows:

                                [GRAPHIC OMITTED]

                  n = number of months remaining in Yield Maintenance Period

                  ARR = Assumed Reinvestment Rate

      (2)  If  the  prepayment  is  made  after  the  expiration  of  the  Yield
Maintenance  Period but before the period set forth in Paragraph 10(b)(A) above,
the  prepayment  premium shall be 1.0% of the unpaid  principal  balance of this
Note.

   (d) Any permitted or required  prepayment  of less than the unpaid  principal
balance of this Note shall not extend or postpone the due date of any subsequent
monthly  installments or change the amount of such  installments,  unless Lender
agrees otherwise in writing.

   (e) Borrower  recognizes that any prepayment of the unpaid principal  balance
of this Note,  whether  voluntary or  involuntary or resulting from a default by
Borrower,  will result in Lender's incurring loss, including  reinvestment loss,
additional expense and frustration or impairment of Lender's ability to meet its
commitments  to third  parties.  Borrower  agrees to pay to Lender  upon  demand
damages  for the  detriment  caused by any  prepayment,  and  agrees  that it is
extremely  difficult  and  impractical  to ascertain the extent of such damages.
Borrower  therefore  acknowledges  and agrees that the  formula for  calculating
prepayment  premiums set forth in this Note represents a reasonable  estimate of
the damages Lender will incur because of a prepayment.

   (f) Borrower further  acknowledges that the prepayment  premium provisions of
this  Note  are  a  material  part  of  the  consideration  for  the  Loan,  and
acknowledges that the terms of this Note are in other respects more favorable to
Borrower as a result of the  Borrower's  voluntary  agreement to the  prepayment
premium provisions.

   11. Costs and Expenses.  To the fullest  extent  allowed by  applicable  law,
Borrower  shall pay all expenses  and costs,  including  fees and  out-of-pocket
expenses  of  attorneys

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<PAGE>

(including  Lender's  in-house  attorneys)  and  expert  witnesses  and costs of
investigation,  incurred by Lender as a result of any default under this Note or
in  connection  with  efforts to collect  any amount due under this Note,  or to
enforce  the  provisions  of any of the other Loan  Documents,  including  those
incurred in post- judgment  collection efforts and in any bankruptcy  proceeding
(including  any action  for relief  from the  automatic  stay of any  bankruptcy
proceeding) or judicial or non-judicial foreclosure proceeding.

   12. Forbearance.  Any forbearance by Lender in exercising any right or remedy
under  this  Note,  the  Security  Instrument,  or any other  Loan  Document  or
otherwise  afforded by applicable  law, shall not be a waiver of or preclude the
exercise of that or any other right or remedy.  The  acceptance by Lender of any
payment after the due date of such  payment,  or in an amount which is less than
the required payment,  shall not be a waiver of Lender's right to require prompt
payment  when due of all other  payments or to exercise any right or remedy with
respect to any  failure to make  prompt  payment.  Enforcement  by Lender of any
security for  Borrower's  obligations  under this Note shall not  constitute  an
election by Lender of remedies so as to preclude the exercise of any other right
or remedy available to Lender.

   13. Waivers.  Presentment,  demand,  notice of dishonor,  protest,  notice of
acceleration,  notice of intent to demand or  accelerate  payment  or  maturity,
presentment  for  payment,  notice  of  nonpayment,   grace,  and  diligence  in
collecting  the  Indebtedness  are  waived by  Borrower  and all  endorsers  and
guarantors of this Note and all other third party obligors.

   14. Loan Charges. Neither this Note nor any of the other Loan Documents shall
be construed to create a contract for the use, forbearance or detention of money
requiring  payment of interest at a rate greater than the maximum  interest rate
permitted to be charged under applicable law. If any applicable law limiting the
amount of interest or other charges  permitted to be collected  from Borrower in
connection  with the Loan is  interpreted  so that any  interest or other charge
provided for in any Loan  Document,  whether  considered  separately or together
with other charges  provided for in any other Loan Document,  violates that law,
and Borrower is entitled to the benefit of that law,  that interest or charge is
hereby reduced to the extent necessary to eliminate that violation. The amounts,
if any,  previously  paid to Lender in excess of the permitted  amounts shall be
applied by Lender to reduce the unpaid  principal  balance of this Note. For the
purpose  of  determining  whether  any  applicable  law  limiting  the amount of
interest or other  charges  permitted  to be  collected  from  Borrower has been
violated,  all  Indebtedness  that  constitutes  interest,  as well as all other
charges made in connection with the Indebtedness that constitute interest, shall
be deemed to be allocated  and spread  ratably over the stated term of the Note.
Unless otherwise required by applicable law, such allocation and spreading shall
be  effected  in such a manner  that the rate of interest so computed is uniform
throughout the stated term of the Note.

   15. Commercial  Purpose.  Borrower  represents that the Indebtedness is being
incurred  by  Borrower  solely for the  purpose  of  carrying  on a business  or
commercial enterprise,  and not for personal, family, household, or agricultural
purposes.

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<PAGE>

   16.  Counting of Days.  Except where  otherwise  specifically  provided,  any
reference in this Note to a period of "days" means  calendar  days, not Business
Days.

   17. Governing Law. This Note shall be governed by the law of the jurisdiction
in which the Land is located.

   18. Captions. The captions of the paragraphs of this Note are for convenience
only and shall be disregarded in construing this Note.

   19.  Notices;   Written  Modifications.   All  notices,   demands  and  other
communications  required or permitted to be given by Lender to Borrower pursuant
to this  Note  shall be given in  accordance  with  Section  31 of the  Security
Instrument.  Any  modification  or amendment  to this Note shall be  ineffective
unless  in  writing  signed  by  the  party  sought  to  be  charged  with  such
modification or amendment;  provided,  however,  that in the event of a Transfer
under  the  terms  of  the  Security  Instrument,  any  or  some  or  all of the
Modification  to Multifamily  Note may be modified or rendered void by Lender at
Lender's option by notice to Borrower/transferee.

   20. Consent to Jurisdiction  and Venue.  Borrower agrees that any controversy
arising under or in relation to this Note shall be litigated  exclusively in the
jurisdiction  in which the Land is located (the  "Property  Jurisdiction").  The
state and federal  courts and  authorities  with  jurisdiction  in the  Property
Jurisdiction  shall have exclusive  jurisdiction  over all  controversies  which
shall arise under or in relation to this Note. Borrower  irrevocably consents to
service,  jurisdiction,  and venue of such  courts for any such  litigation  and
waives  any other  venue to which it might be  entitled  by virtue of  domicile,
habitual residence or otherwise.

   21. WAIVER OF TRIAL BY JURY. BORROWER AND LENDER EACH (A) AGREES NOT TO ELECT
A TRIAL BY JURY  WITH  RESPECT  TO ANY  ISSUE  ARISING  OUT OF THIS  NOTE OR THE
RELATIONSHIP BETWEEN THE PARTIES AS LENDER AND BORROWER THAT IS TRIABLE OF RIGHT
BY A JURY AND (B) WAIVES  ANY RIGHT TO TRIAL BY JURY WITH  RESPECT TO SUCH ISSUE
TO THE EXTENT THAT ANY SUCH RIGHT  EXISTS NOW OR IN THE  FUTURE.  THIS WAIVER OF
RIGHT  TO  TRIAL  BY JURY IS  SEPARATELY  GIVEN  BY EACH  PARTY,  KNOWINGLY  AND
VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL.

         ATTACHED EXHIBIT.  The following Exhibit is attached to this Note:

         [X]  Exhibit A    Modifications to Multifamily Note

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<PAGE>

   IN WITNESS WHEREOF, Borrower has signed and delivered this Note under seal or
has  caused  this  Note to be  signed  and  delivered  under  seal  by its  duly
authorized representative. Borrower intends that this Note shall be deemed to be
signed and delivered as a sealed instrument.

                              Secured Investment Resources Fund, L.P. III
                              a Missouri limited partnership

                              By:   Nichols Resources, Ltd.,
                                    a Missouri corporation
                              Its:  General Partner

                              By: /s/ David L. Johnson
                                      David L. Johnson, Vice President

                              Borrower's Social Security/Employer ID Number:
                              48-6291172

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<PAGE>
                                    EXHIBIT A

                        MODIFICATIONS TO MULTIFAMILY NOTE

1. Paragraph 9(c) of the Note is amended to add the following subparagraph (4):

   (4) failure by Borrower to pay the amount of any:
       [ ] fire, hazard or other insurance premiums,
       [ ] Taxes,
       [X] water and sewer charges,
       [X] ground rents,
       [X] assessments or other charges

       in accordance with the terms of the Security Instrument.

                                      A-1