SECOND AMENDMENT TO MANAGEMENT AGREEMENT
                    ----------------------------------------
                             WITH OPTION TO PURCHASE
                             -----------------------
                        (AL I - Emeritrust 25 Facilities)

     This Second Amendment to Management Agreement with Option to Purchase (this
"Amendment")  is  effective  as  of  the  1st  day of January, 2002 by and among
Emeritus  Management  LLC,  a  Washington  limited  liability company ("Emeritus
Management"), Emeritus Management I LP, a Washington limited partnership ("Texas
Manager;"  together  with  Emeritus Management referred to herein as "Manager"),
Emeritus  Corporation, a Washington Corporation ("Emeritus), AL Investors LLC, a
Delaware  limited  liability  company  ("AL  Investors"), for itself and as sole
managing  member  or  sole managing member of the general partner of each of the
Facility  Entities  set  forth  on  Exhibit  A  to  the Management Agreement (as
hereinafter  defined).


                                    Recitals
                                    --------

     A.     Emeritus  Management,  Texas Manager, Emeritus, AL Investors, ESC I,
L.P., a Washington limited partnership ("ESC"), and Emeritus Properties I, Inc.,
a  Washington corporation ("EPI") entered into that certain Management Agreement
with  Option  to  Purchase  (Emeritrust 25) dated December 30, 1998, pursuant to
which,  among  other  things,  AL  Investors  and  the Facility Entities engaged
Manager to manage certain Facilities described therein (as subsequently amended,
the  "Management  Agreement").   The  Management  Agreement  has been previously
amended  by  First  Amendment  to  Management Agreement with Option to Purchase,
dated  March  22,  2001  (the  "First  Amendment"). Pursuant to the terms of the
Management  Agreement,  ESC  and  EPI  have  ceased  to  be  Managers  under the
Management  Agreement.

     B.     In  addition to the Management Agreement, the parties and certain of
their  affiliates  have  previously  entered  into  the  following  agreements:

     1.     That  certain  Management Agreement with Option to Purchase (AL II -
14  Operating Facilities) dated March 26, 1999 by and among Emeritus Management,
Texas  Manager,  Emeritus,  AL  Investors  II  LLC  (for itself and on behalf of
certain  Facility Entities defined therein), ESC, ESC G.P. I, Inc., a Washington
corporation  ("ESCGP"), and EPI, as amended by Amendment to Management Agreement
dated March 27, 2000 and by Second Amendment to Management Agreement dated March
22,  2001 (as amended, the "AL II Management Agreement (GMAC))".  ESC, ESCGP and
EPI  have  ceased  to  be  Managers under the AL II Management Agreement (GMAC).

     2.     That  certain  Management  Agreement  with  Option  to  Purchase
(Teachers),  by and among Emeritus Management, Emeritus, and AL Investors II LLC
(for  itself  and on behalf of certain Facility Entities defined therein), dated
March  27,  2000  (the  "AL  II  Management  Agreement  (Teachers))".

3.     That  certain  Management  Agreement  with  Option to Purchase (AL II - 5
Development  Facilities)  by  and  among  Manager,  Emeritus,  and  AL Investors
Development  LLC, a Delaware limited liability company (for itself and on behalf
of  certain Facility Entities defined therein), dated March 25, 1999 (the "AL II
Development  Management  Agreement").

     C.     In  connection with an extension of the Senior Loan, the parties now
desire  to  amend the Management Agreement on the terms and conditions contained
herein.

     NOW,  THEREFORE, in consideration of Ten and No/100 Dollars, the agreements
contained  herein,  and  other  good and valuable consideration, the receipt and
sufficiency  of  which  is  hereby  acknowledged,  the  parties  hereby agree as
follows:

     Defined Terms.  All terms capitalized herein but not defined shall have the
     -------------
     meanings  given  them  in  the  Management  Agreement.

     Extension of Management Agreement.  Section 2.3 of the Management Agreement
     ---------------------------------
(as  added  under  the  First  Amendment) is hereby replaced with the following:

     2.3     ADDITIONAL  EXTENSION  TERM.  Under  the  Senior Loan Amendment, AL
Investors  is currently eligible for a 9 month loan extension in accordance with
the  terms and conditions contained in Section 2.4 thereof (the "First Extension
Period"),  and at the end of the First Extension Period, may be eligible for one
additional  9  month  loan extension in accordance with the terms and conditions
contained in Section 2.5 thereof (the "Second Extension Period") to be exercised
no  later  than September 15, 2002.  If AL Investors is entitled to exercise its
extension  rights  under  the  terms  of the Senior Loan Amendment for the First
Extension  Period and the Second Extension Period, it hereby agrees that it will
do  so.

     The  parties  hereby  acknowledge  that  AL  Investors  has  exercised  its
extension  rights for the First Extension Period, and agree that the term of the
Management Agreement is hereby extended to June 30, 2003 to make it co-terminous
with  the  Second  Extension  Period.  All  of  the  terms and provisions of the
Management  Agreement  (as  modified  by  this  Amendment)  shall continue to be
applicable  throughout  the  extended  term,  including, without limitation, the
obligation  to  fund  Operating  Deficits and the right to exercise the Purchase
Option.  If during any extension term the Management Agreement is terminated for
any  reason  (other  than  the failure to qualify for extension rights under the
Senior  Loan  Amendment), at Owner's election in its sole discretion Manager may
be required to continue to provide management services for the Facilities for up
to  90  days (until terminated by Owner upon not less than 30 days prior written
notice)  and  the management fee payable during such period shall be 3% of Total
Revenues  from  each  Facility  then  managed.

     If  AL Investors is not eligible to exercise its extension rights under the
Senior  Loan  Amendment for the Second Extension Period, then AL Investors shall
have  the right to terminate the Management Agreement.  However, if AL Investors
does  not  terminate  the Management Agreement and obtains alternative financing
for  the  Facilities  or  modifies  the existing Senior Loan to extend the term,
Manager's  obligation  to fund Operating Deficits shall not exceed the Operating
Deficits  that  would  have been required to be paid during the Second Extension
Period  had  it  been  exercised  or permitted to be exercised.  For purposes of
calculating  Operating Deficits pursuant to this section, Manager shall have the
benefit  of  any  interest  rate  caps  in  effect.

     If  Al  Investors  elects  to terminate the Management Agreement because it
does  not qualify for the Second Extension Period, then Owner shall be deemed to
have notified Manager of its intent to extend beyond such maturity date pursuant
and  subject  to  the terms of section 2.2 of the Management Agreement.   During
the  first  90 days of such extension Owner shall notify Manager of the duration
of the extension and the Facilities to which such extension is applicable, which
extension  may  be  up to 12 months from the date of termination, subject to any
earlier  termination  rights  contained  in  the  Management  Agreement  or this
Amendment.  The  extension  exercised  pursuant to section 2.2 of the Management
Agreement  in  accordance with this paragraph shall not be subject to the 90 day
prior  notice  requirement  contained in section 2.2 of the Management Agreement
but  shall  be  for  a  Management  Fee  of 5% of gross revenues as set forth in
Section 2.2 and Manager shall not be obligated to fund Operating Deficits during
such  period.

     The  extension  of  the  Purchase  Option  shall continue to be governed by
Section  4.2  of  the  First  Amendment.

1.     Management Fee.   The parties agree that in connection with the extension
       --------------
     of  the  Senior  Loan being exercised in connection with this Agreement, AL
Investors  has  agreed  to  pay  from  funds  held  by  Emeritus on behalf of AL
Investors  (i)  an  interest  rate cap not to exceed 4% for LIBOR for the entire
amount  of  the  Tranche  A  and  Tranch B indebtedness, (ii) all extension fees
charged  by  the  Senior  Lender  with  respect to the first and the second loan
extensions,  and  (iii)  all  closing costs related to the first and second loan
extensions,  including,  without  limitation, all costs and fees incurred by the
Senior  Lender, title insurance fees, UCC search costs, attorneys fees and costs
to AL Investors and Senior Housing Partners I, L.P. and all other reasonable out
of pocket costs and expenses (collectively, the "Loan Extension Closing Costs").
AL Investors shall be entitled to recoup all Loan Extension Closing Costs out of
Operating  Profit  from  the  Facilities,  without  interest, after payment of a
management  fee of 3% of Total Revenues from the Facilities to Emeritus.  To the
extent  not  modified  by  this  paragraph 3, paragraph 9 of the First Amendment
governing  prior  loan  restructure  fees  shall  continue to be applicable with
respect to the Pooled Expenses related to the Senior Loan Restructure as defined
therein.  To  memorialize the foregoing agreement, Section 7.2 of the Management
Agreement  (as replaced by Paragraph 5 of the First Amendment) is hereby deleted
and  replaced  in  its  entirety  with  the  following:

          7.2     REIMBURSEMENT  OF  LOAN  EXTENSION  CLOSING  COSTS; ADDITIONAL
MANAGEMENT  FEE.  Any  Operating Profit in excess of the Base Management Fee and
any  Accrued Base Management Fee at the end of each month shall be paid first to
Owner  until Owner has been reimbursed for all Loan Extension Closing Costs then
outstanding  on  any loan extension, then 50% to Manager and 50% to Owners until
Manager  has  received  (i) an additional management fee of 4% of Total Revenues
from  all Facilities in the aggregate subject to this Agreement (the "Additional
Management Fee") plus (ii) any Accrued Additional Management Fee (as hereinafter
defined).  If  there  is insufficient Operating Profit after payment of the Base
Management  Fee,  Accrued  Base  Management  Fee, and any Loan Extension Closing
Costs  during any month to pay the Additional Management Fee, the unpaid portion
shall  accrue  and  be  added to any accrued amounts for prior months commencing
January  1, 2002 (the "Accrued Additional Management Fee").  The Base Management
Fee,  any  Accrued  Base  Management  Fee, the Additional Management Fee and any
Accrued  Additional  Management  Fee  are  sometimes  referred  to herein as the
"Management  Fee".

     In  addition, Section 8.2 of the Management Agreement (as replaced pursuant
to paragraph 6 of the First Amendment), is hereby amended to (i) exclude Capital
Improvements  from  Fixed  Operating  Expenses  for  purposes  of subsection (b)
thereof, and (ii) add a new section (e) as follows:  "(e)     Any Loan Extension
Closing Costs to be reimbursed to Owner", such that Loan Extension Closing Costs
are  paid  after  the  Base  Management Fee and Accrued Base Management Fee, but
prior  to  any  Additional  Management Fee or Accrued Additional Management Fee.
The  following  conforming amendments are hereby made:  the prior subsection (e)
of  Section  8.2  shall  become  subsection  (f), the prior subsection (f) shall
become  subsection (g), and the reference to "Section 8.2(e)" in Section 9.9 (as
added  by  the  First  Amendment)  shall  instead  refer  to  "Section  8.2(f)".

     Emeritus acknowledges that is has no right to reimbursement for any amounts
deposited  on  account  of Section 4.12 of the Senior Loan loan documents or any
additional  amounts  funded by Manager to cover any deferred Tranche A interest.

2.     Failure  to  Achieve  Financial  Performance.  A new subsection 9.8(d) is
hereby  added  as  follows:

     (d)     For  purposes  of  calculating  Cash  Available  for  Distribution
actually  distributed  to  Owner  pursuant to this Section 9.8, Manager shall be
entitled to include as part of such distribution any amounts reimbursed to Owner
for  Loan  Extension  Closing  Costs.

3.     Purchase  Option  Requirements.  Section 13.1 of the Management Agreement
       ------------------------------
is hereby amended to add the following condition to the exercise of the Purchase
     Option:  "(d)  the  Purchase  Option under each of (i) the AL II Management
Agreement  (GMAC), (ii) the AL II Management Agreement (Teachers), and (iii) the
AL II Development Management Agreement, have been simultaneously exercised."  In
addition,  effective  from  and after December 31, 2002, a new subsection (f) is
added  to Section 13.1 of the Management Agreement as follows:  "(f) the term of
the  AL  II  Development  Management Agreement has been extended to December 31,
2003."

4.     Cross  Default  of  Purchase  Options.  Section  13.9  of  the Management
       -------------------------------------
Agreement  is  hereby  amended by adding the following at the end:  "If Emeritus
elects  to  exercise its purchase options under the AL II Development Management
Agreement,  the  AL II Management Agreement (Teachers), and the AL II Management
Agreement  (GMAC), and thereafter fails to timely consummate the purchase of the
facilities  subject  to  the  exercised  purchase options in accordance with the
terms  thereof  for any reason other than a default by the owners and failure to
deliver  the  applicable  deeds  for each of the facilities, the Purchase Option
under  this  AL  I  Management Agreement shall be deemed terminated and Emeritus
shall  thereafter  have  no  further  right  to  purchase  the  Facilities".

5.     Additional Collateral Properties.  The parties acknowledge that under the
       --------------------------------
     terms  of  the  Senior  Loan  Restructure,  Tranche A and Tranche B will be
resized as permitted thereunder, which will consolidate Tranche B into Tranche A
and  eliminate the collateralization of Tranche B with the Additional Collateral
Properties.

     Ratification.  The  Management  Agreement, as amended by this Agreement, is
     ------------
hereby  ratified  and  confirmed.

     Understandings  and  Agreements.  This  Amendment,  together  with  the
     -------------------------------
Management  Agreement,  constitutes  all  of  the  understandings and agreements
     ----
between  the  parties  with  respect  to  the  management  of  the  Facilities.

     Headings.  The  headings  contained herein are for convenience of reference
     --------
only  and  are  not intended to define, limit or describe the scope or intent of
any  provision  of  this  Agreement.

     Applicable  Law.  This  Agreement shall be construed and interpreted and be
     ---------------
governed  by  the  laws  of  the  State  of  Washington.

     IN  WITNESS WHEREOF, the parties have executed and delivered this Agreement
as  of  the  date  and  year  first  above  written.


     EMERITUS  MANAGEMENT
     --------------------

     EMERITUS  MANAGEMENT  LLC,
     a  Washington  limited  liability  company

     By:     Emeritus  Corporation,
          a  Washington  corporation


     By:     /s/  Raymond  R.  Brandstrom
             ----------------------------
          Name  Raymond  R.  Brandstrom
                -----------------------
          Title  Vice  President  of  Finance
                 ----------------------------


     EMERITUS  MANAGEMENT  I  LP
     ---------------------------

     EMERITUS  MANAGEMENT  I  LP,
     a  Washington  limited  partnership

     By:     EM  I,  LLC,  a  Washington  limited  liability  company

          By:     Emeritus  Corporation,  a
Washington  corporation

                    By:     /s/  Raymond  R.  Brandstrom
                            ----------------------------
                         Name  Raymond  R.  Brandstrom
                               -----------------------
                         Title  Vice  President  of  Finance
                                ----------------------------

                              EMERITUS
                              --------

                              EMERITUS  CORPORATION,  a  Washington
corporation

                              By:     /s/  Raymond  R.  Brandstrom
                                      ----------------------------
                                   Name  Raymond  R.  Brandstrom
                                         -----------------------
                                   Title  Vice  President  of  Finance
                                          ----------------------------


                              AL  INVESTORS
                              -------------

AL  INVESTORS  LLC, a Delaware limited liability company, for itself and as sole
managing  member on behalf of each of the Owners, or in the case where the Owner
is  a  limited  partnership,  as  sole  managing member on behalf of the general
partner  thereof


     By:  /s/  Norman  L.  Brendan
          ------------------------
          Name  Norman  L.  Brendan
                -------------------
          Title  Manager
                 -------





The  undersigned  lenders in connection with the Senior Loan and the Junior Loan
have executed this Agreement for the sole purpose of consenting to the foregoing
Amendment.


     GMAC  Commercial  Mortgage  Corporation,     a  California  corporation

     By:
     Name
     Title


     Senior  Housing  Partners  I,  L.P.,
     a  Delaware  limited  partnership

     By: /s/  Noah  R.  Levy
         -------------------
     Name  Noah  R.  Levy
           --------------
     Title  Vice  President
            ---------------

<PAGE>

The  undersigned  has  executed  this  Agreement  for  the  sole  purpose of (i)
acknowledging  and  consenting  to  the foregoing Amendment, (ii) ratifying that
certain  Guaranty  of Management Agreement and Shortfall Funding Agreement dated
December 30, 1998, as amended by Amendment dated March 22, 2001, entered into by
Emeritus  in  favor  or AL Investors and the Facility Entities (the "Guaranty"),
and  (iii)  confirming  and  agreeing  that  foregoing Amendment does not alter,
modify,  amend  or  waive  any  terms  contained  in  the  Guaranty.


     Emeritus  Corporation,
     a  Washington  corporation


     By:/s/  Raymond  R.  Brandstrom
        ----------------------------
          Name  Raymond  R.  Brandstrom
                -----------------------
          Title  Vice  President  of  Finance
                 ----------------------------