THIRD AMENDMENT TO
                               ------------------
                              MANAGEMENT AGREEMENT
                              --------------------
                        (AL II - 14 Operating Facilities)
                                     (GMAC)

     This  Third  Amendment  to  Management Agreement (this "Amendment") is made
effective  this 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"), Emeritus
Corporation,  a  Washington  Corporation  ("Emeritus),  AL  Investors  II LLC, a
Delaware  limited  liability company ("AL Investors II"), 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 AL II Management Agreement
(GMAC) (as amended and as hereinafter defined) which own a Facility other than a
Refinanced  Facility.

                                    Recitals
                                    --------

     A.     Emeritus  Management,  Texas Manager, Emeritus, AL Investors II, ESC
I,  L.P.,  a  Washington  limited  partnership  ("ESC"),  ESC  G.P.  I,  Inc., a
Washington  corporation ("ESCGP"), and Emeritus Properties I, Inc., a Washington
corporation  ("EPI")  entered into that certain Management Agreement with Option
to  Purchase  (AL II - 14 Operating Facilities), dated March 26, 1999, which was
thereafter segregated by Amendment to Management Agreement (AL II - 14 Operating
Facilities), dated March 27, 2000 (the "First Amendment"), pursuant to which the
Refinanced  Facilities  (as  defined  therein)  were  deleted, and were included
instead in that certain Management Agreement with Option to Purchase (Teachers),
dated March 27, 2000 (the "AL II Management Agreement (Teachers)", and which was
also  thereafter amended by Second Amendment to Management Agreement dated March
22,  2001  (the  "Second  Amendment;"  as  so segregated and amended, the "AL II
Management  Agreement  (GMAC)".  ESC,  ESCGP  and EPI have ceased to be Managers
under  the  AL  II  Management  Agreement  (GMAC).

     B.     Simultaneously  with  the  initial execution of the AL II Management
Agreement  (GMAC),  EPI,  Emeritus, and AL Investors Development LLC, a Delaware
limited liability company (for itself and on behalf of certain Facility Entities
defined  therein), entered into that certain Management Agreement with Option to
Purchase  (AL  II - 5 Development Facilities), dated March 25, 1999, pursuant to
which,  among  other  things,  Manager  was engaged to manage certain Facilities
described  therein  (the  "AL  II  Development  Management  Agreement").

     C.     The  parties  hereto or certain affiliates thereof also entered into
that certain Management Agreement with Option to Purchase (Emeritrust 25), dated
December  30,  1998,  pursuant to which, among other things, AL Investors LLC, a
Delaware  limited  liability  company, and the Facility Entities defined therein
engaged  Manager  to  manage certain Facilities described therein (as amended as
described  below,  the  "AL  I  Management  Agreement").

     D.     GMAC  Commercial  Mortgage  Corporation ("GMAC") is the lender under
the  Senior  Loan  under  both  the  AL  I  Management  Agreement  and the AL II
Management  Agreement (GMAC).  The Senior Loan as defined in the AL I Management
Agreement  is  referred  to  herein  as  the  "AL  I  Senior  Loan".

     E.     Owner  may  elect  to  refinance  one or more of the Facilities with
lenders  originating  loans  insured  by  the Federal Housing Administration, an
organization  unit  of  the  United  States  Department  of  Housing  and  Urban
Development,  or  other similar lenders, which may be locked to repayment at the
time  the  Purchase  Option  is  exercised  (each  a  "New  Loan").

     F.     As  a  condition  to  an extension of the Junior Loan and the Senior
Loan,  and  in anticipation of one or more New Loans, the parties have agreed to
amend  the  AL  II  Management  Agreement  (GMAC)  as  set  forth  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:

     Definitions.  All  terms  capitalized herein but not defined shall have the
     -----------
meanings  given  them  in  the  AL  II  Management  Agreement  (GMAC).

     Extension  of Management Agreement.  New Section 2.3 is hereby added to the
     ----------------------------------
AL  II  Management  Agreement  (GMAC):

          2.3  Additional  Extension  Term.  The  parties hereby agree to extend
               ---------------------------
the  AL  II  Management  Agreement  (GMAC)  until  June 30, 2003 (the "Extension
Period");  provided,  however,  that  if  the  AL  I Management Agreement is not
extended  for the Second Extension Period as provided therein, either Manager or
AL  Investors  II  shall  have  the  right  to  terminate  this AL II Management
Agreement  (GMAC)  upon  60 days written notice, upon which the Extension Period
shall  be  deemed  to  terminate  on  the date of such termination of this AL II
Management  Agreement  (GMAC).  All  of  the  terms  and provisions of the AL II
Management  Agreement  (GMAC)  shall  continue  to  be applicable throughout the
Extension  Period.  Notwithstanding  the  foregoing, the parties agree that this
Section  2.3  shall not impair Owners' extension rights under Section 2.2 of the
AL  II  Management  Agreement  (GMAC).

     The  parties hereby acknowledge that the foregoing extension is intended to
cause  the  AL  II  Management Agreement (GMAC) to be co-terminous with the AL I
Management  Agreement  and the extension of the AL I Senior Loan, as well as the
anticipated  extension  of  the Senior Loan (as defined in this AL II Management
Agreement  (GMAC)).   The  Senior  Loan  with  respect  to  the AL II Collateral
Properties  (as defined in the Second Amendment) has been automatically extended
in  connection  with  the AL I Loan Restructure.  Owner is currently negotiating
with  the lender under the Senior Loan ("GMAC") for an extension with respect to
the  5  Facilities  that  were  not included as AL II Collateral Properties (the
"Non-Additional  Collateral Properties"), such that the Senior Loan with respect
to all of the Facilities would be co-terminous with the AL I Senior Loan, on the
terms  set  forth  in  that certain term sheet signed by GMAC on ________, 2001.
GMAC  has  notified  Owners  that it requires 90 days to implement the requested
extension,  and  has  agreed to grant Owner an interim extension for such 90 day
period  (the "Interim Extension").  If for any reason the extension as contained
in  the  term sheet does not occur and the Senior Loan matures after the Interim
Extension,  the  parties  agree  that  AL  Investors  II shall have the right to
terminate  this  AL  II  Management  Agreement  (GMAC)  as to the Non-Additional
Collateral  Properties  only.  Neither of the foregoing termination rights shall
have  the  effect  of  terminating  the  AL  I  Management  Agreement, the AL II
Management  Agreement (Teachers), or the AL II Development Management Agreement.

1.     Costs  and  Expenses.  AL  Investors  II  shall pay for all closing costs
       --------------------
related  to  the  loan  extensions, including, without limitation, all costs and
fees  incurred by the Senior Lender, title insurance fees, and UCC search costs.

2.     Purchase  Option.
       ----------------

     3.1     Exercise  of  Option.  The first sentence of Section 13.2 of the AL
             --------------------
II  Management  Agreement  (GMAC) (as amended by the Second Amendment) is hereby
deleted  and  replaced  in  its  entirety  with  the  following:

The Purchase Option shall permit Emeritus to purchase the Facilities at any time
during the Extension Period, provided that written notice of the exercise of the
option  is  given  by  Emeritus  to the Owners (the "Purchase Option Notice") at
least  15  days  prior  to the expiration or sooner termination of the Extension
Period.

          3.2     Place  and  Time of Closing.  Section 13.6 (as replaced by the
                  ---------------------------
Second  Amendment)  is hereby amended to replace all references to "December 31,
2001"  with  "the  end  of  the  Extension  Period".

     3.3     Option  Facilities.  The  parties  anticipate  that  the  AL  II
             ------------------
Collateral  Properties  will  be  released as additional collateral for the AL I
Senior  Loan,  and  upon  such  release agreement that paragraph 3 of the Second
Amendment  will  no  longer  be  applicable.

          3.4     Conditions  to  Exercise.  In  addition  to  the  conditions
                  ------------------------
precedent to the exercise of the Purchase Option contemplated in Section 13.1 of
the  AL  II  Management  Agreement (GMAC) and paragraph 6 of the First Amendment
(which required a simultaneous exercise of the "Purchase Option" under the AL II
Management  Agreement  (Teachers)),  it  shall  be  a condition precedent to the
exercise of the Purchase Option (which condition Owners may waive, in their sole
discretion  at  any  time)  (i)  that  the  "Purchase  Option"  under  the AL II
Development  Management  Agreement  and the AL I Management Agreement shall have
been  simultaneously  exercised,  and (ii) effective from and after December 31,
2002,  the  term  of  the AL II Development Management Agreement shall have been
extended  to  December  31,  2003.

          3.5     Cross  Default  of Purchase Options. Section 13.9 of the AL II
                  -----------------------------------
Management  Agreement  (GMAC)  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  I  Management  Agreement, 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 II Management Agreement (GMAC) shall be deemed
terminated  and  Emeritus shall thereafter have no further right to purchase the
Facilities".

     The  foregoing terms in the AL II Management Agreement (Teachers), together
with  the  guaranty  thereof,  shall  be  deemed  amended  as  set  forth above.

     Termination  Upon  Default.  A new Section 9.8 is hereby added to the AL II
     ---------------------------
Management  Agreement  (GMAC)  as  follows:

          9.8  Termination  by Lender.  If required by the holder of a New Loan,
               ----------------------
upon an event of default under any New Loan the lender thereunder shall have the
right  to terminate this Agreement as to the Facility securing the New Loan upon
30  days  prior  written  notice  to  Emeritus  and  to  AL  Investors  II.

     Conveyances  Subject  to  New  Loan.  It is expressly understood and agreed
     -----------------------------------
that  Section  10.3.1 of the Management Agreement shall not be applicable to any
New  Loan, and that Emeritus or its designee taking title to a Facility pursuant
to the Purchase Option shall be required to assume any New Loan not then subject
     to  prepayment,  and shall pay all costs and fees associated with such loan
assumption.  In  addition,  it  shall  be  Emeritus' responsibility to cause all
conditions  and  requirements  relating  to the assumption of the New Loan to be
satisfied  in  full as of Closing.   Emeritus shall receive a credit against the
Purchase  Price  for  the  assumed  balance  and any accrued interest due on any
assumed  New  Loan.

3.     Segregation  of Management Agreement.   If required by any lender under a
       ------------------------------------
New  Loan,  Al  Investors II, for itself and the applicable Facility Entity, and
Manager  agree  to  segregate the AL II Management Agreement (GMAC) to cause the
Facility  refinanced  under  the New Loan to be subject to a separate management
agreement  on  substantially the same terms and conditions of the existing AL II
Management  Agreement  (GMAC).

     Notices.  All  notices to be given by either party to this Agreement to the
     -------
other  party hereto shall be in writing, and shall be sent to the parties at the
addresses  and  in  the  manner  set  forth  in  the  Management  Agreement.

     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
                                ----------------------------

<PAGE>

                              EMERITUS
                              --------

                              EMERITUS  CORPORATION,  a  Washington
corporation

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




                              AL  INVESTORS  II
                              -----------------

AL  INVESTORS  II  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
                 -------







<PAGE>

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 (AL II - 14 Operating Facilities) dated
March  26,  1999, given by Emeritus in favor of AL Investors II and the Facility
Entities,  as  amended  by  Amendment and Ratification of Guaranty of Management
Agreement  dated  March  27,  2000,  and by Second Amendment and Ratification of
Guaranty  of  Management  Agreement  dated  March 22, 2001 (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
                 ----------------------------