<PAGE>
                                                               EXHIBIT 10(nn)III


                       ASSIGNMENT AND ASSUMPTION AGREEMENT

         For the sum of One Dollar ($1.00) and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
East Bank Angel Joint Venture, an Oregon general partnership ("Assignor"), the
holder of a general partner interest (the "Interest") in Portland Lofts
Associates Limited Partnership, a Delaware limited partnership (the
"Partnership") under that certain Amended and Restated Agreement of Limited
Partnership dated as of August 30, 1989 (the "Partnership Agreement"), hereby
assigns, transfers and conveys to Portland Lofts Apartments, LLC, a Delaware
limited liability company ("Assignee"), all of Assignor's right, title and
interest in and to the Interest, free and clear of all liens, encumbrances,
restrictions or claims of any kind except those arising under the Partnership
Agreement and ancillary documents thereto.

         Captialized terms used herein and not otherwise defined shall have the
meanings set forth in the Partnership Agreement.

         The assignment of the Interest hereunder constitutes an assignment and
transfer of all of Assignor's right, title and interest in and to its General
Partner Interest in the Partnership and, accordingly, Assignor states its
intention that Assignee succeed to Assignor's interest in the Partnership and
become a General Partner in substitution for Assignor. Assignor specifically
represents that it is the owner of the Interest free and clear of all liens,
encumberances, restrictions or claims of any kind except those arising under the
Partnership Agreement and ancillary documents, thereto. However, Assignor
specifically makes no representations or warranties regarding the condition of
the Property owned by the Partnership.

         In consideration of the aforesaid assignment, Assignee hereby accepts
such assignment, Assignee hereby assumes all of the rights and obligations of
Assignor relating to the Interest, Assignee hereby accepts and agrees to be
bound by all of the terms and provisions of the Partnership Agreement, Assignee
agrees to perform, satisfy and discharge all obligations of Assignor relating to
the Interest, and Assignee agrees to become the sole General Partner of the
Partnership. Assignee agrees to defend and indemnify Assignor from all presently
existing and any future liabilities of the Partnership to third parties.

         Assignor hereby represents and Assignee hereby represents for the
benefit of the Partnership that the assignment, transfer, and conveyance of the
Interest made under this Agreement is made in accordance with the Partnership
Agreement and all applicable laws and regulations.

         This Agreement may be executed by the parties in counterparts, each
such counterpart shall be deemed an original, and all such counterparts taking
together shall constitute one and the same instrument.



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         IN WITNESS WHEREOF, the parties have duly executed this Assignment and
Assumption Agreement under seal. This Assignment and Assumption Agreement is to
be effective as of December 31, 2001.

                                         ASSIGNOR:

                                         EAST BANK ANGEL JOINT VENTURE


                                         By: /s/ Joseph W. Angel
                                             --------------------------------
                                             Joseph W. Angel, Partner

                                             and

                                         By: PACIFIC STAR CORPORATION,
                                             Partner


                                             By: /s/ Joseph W. Angel
                                                 ----------------------------
                                                 Joseph W. Angel, President

                                         ASSIGNEE:

                                         PORTLAND LOFTS APARTMENTS, LLC, a
                                         Delaware limited liability company

                                         By: HISTORIC PRESERVATION PROPERTIES
                                             1989 LIMITED PARTNERSHIP, Member

                                             By:  Boston Historic Partners
                                                  Limited Partnership,
                                                  General Partner

                                                   By: Portfolio Advisory
                                                       Services, Inc.


                                                   By: /s/ Terrence P. Sullivan
                                                       -------------------------
                                                       Terrence P. Sullivan,
                                                       President

                                              and

                                              By: /s/ Terrence P. Sullivan
                                                  ---------------------------
                                                  Terrence P. Sullivan,
                                                  General Partner



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