UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                             ______________________

                                    FORM 10-Q


(Mark  One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT  1934

                  For the quarterly period ended June 30, 2002.

[  ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR  15(D) OF THE SECURITIES
EXCHANGE  ACT  OF  1934

                        Commission file number   1-14012

                              EMERITUS CORPORATION
             (Exact name of registrant as specified in its charter)

              WASHINGTON                                       91-1605464
    (State  or other jurisdiction                            (I.R.S Employer
       of  incorporation  or  organization)                 Identification  No.)

                         3131 Elliott Avenue, Suite 500
                                Seattle, WA 98121
                    (Address of principal executive offices)

                                 (206) 298-2909
              (Registrant's telephone number, including area code)
                          ____________________________

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


As  of  July  31,  2002, there were 10,214,934 shares of the Registrant's Common
Stock,  par  value  $.0001,  outstanding.

<PAGE>
<TABLE>
<CAPTION>

                                      EMERITUS CORPORATION

                                              INDEX


                                 Part I.  Financial Information


<S>                                                                                     <C>

Item 1.  Financial Statements: . . . . . . . . . . . . . . . . . . . . . . . . . . . .  Page No.
                                                                                        --------

         Condensed Consolidated Balance Sheets as of June 30, 2002, and
         December 31, 2001. . . . . . . . . . . . . . . . . . . . . . . . . . .  . . .         1

         Condensed Consolidated Statements of Operations for the
         Three Months and Six Months ended June 30, 2002 and 2001 . . . . . . . . . . .        2

         Condensed Consolidated Statements of Cash Flows for the Six
         Months ended June 30, 2002 and 2001 . . . . . . . . . . . . . . . . . . . . .         3

         Notes to Condensed Consolidated Financial Statements . . . . . . . . . . . . .        4

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations. . . . . . . . . . . . . . . . . . . . . . . . . . . .      9


Item 3.  Quantitative and Qualitative Disclosures About Market Risk. . . . . . . . . .        20


                                 Part II.  Other Information

Note:  Items 1 through 5 of Part II are omitted because they are not applicable.

Item 6.  Exhibits and Reports on Form 8-K .  .   .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  21
         Signature. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  .      42
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                                EMERITUS CORPORATION
                                        CONDENSED CONSOLIDATED BALANCE SHEETS
                                                     (unaudited)
                                          (In thousands, except share data)
                                                       ASSETS
                                                                                         June 30,      December 31,
                                                                                           2002            2001
                                                                                      --------------  --------------
<S>                                                                                   <C>             <C>
Current Assets:
 Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $      10,959   $       9,811
 Short-term investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,625           1,376
 Trade accounts receivable, net. . . . . . . . . . . . . . . . . . . . . . . . . . .          1,232           1,172
 Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          2,164           2,859
 Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . .          4,274           2,463
 Property held for sale. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          2,242           2,242
                                                                                      --------------  --------------
      Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         22,496          19,923
                                                                                      --------------  --------------
Property and equipment, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . .        108,672         131,200
Property held for development. . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,040           1,040
Notes receivable from and investments in affiliates. . . . . . . . . . . . . . . . .          3,816           3,675
Restricted deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          4,852           5,520
Lease acquisition costs, net . . . . . . . . . . . . . . . . . . . . . . . . . . . .          5,482           4,864
Other assets, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          2,583           2,206
                                                                                      --------------  --------------
      Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $     148,941   $     168,428
                                                                                      ==============  ==============

                                         LIABILITIES AND SHAREHOLDERS' DEFICIT

Current Liabilities:
 Current portion of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . .  $      50,981   $       4,523
 Trade accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,723           2,105
 Accrued employee compensation and benefits. . . . . . . . . . . . . . . . . . . . .          3,824           3,301
 Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,713           2,861
 Accrued real estate taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,435           1,415
 Accrued dividends on preferred stock . . . .. . . . . . . . . . . . . . . . . . . .         10,505           7,429
 Other accrued expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          7,381           8,690
 Deferred revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          2,491               -
 Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,601           1,699
                                                                                      --------------  --------------
      Total current liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . .         81,654          32,023
                                                                                      --------------  --------------
Long-term debt, less current portion . . . . . . . . . . . . . . . . . . . . . . . .         68,709         131,070
Convertible debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         32,000          32,000
Deferred gain on sale of communities . . . . . . . . . . . . . . . . . . . . . . . .         20,227          18,671
Deferred rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          2,491           2,404
Other long-term liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . .            271             256
                                                                                      --------------  --------------
      Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        205,352         216,424
                                                                                      --------------  --------------
Minority interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            736           1,145
Redeemable preferred stock
Commitments and contingencies
Shareholders' Deficit:
Preferred stock, $.0001 par value. Authorized 70,000 shares; issued and outstanding.              -               -
    30,609 and 30,609 at June 30, 2002, and December 31, 2001, respectively
Common stock, $.0001 par value. Authorized 40,000,000 shares; issued and
    outstanding 10,214,934 and 10,196,030 shares at June 30, 2002, and . . . . . . .              -               -
    December 31, 2001, respectively. . . . . . . . . . . . . . . . . . . . . . . . .              1               1
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         68,397          67,686
Accumulated other comprehensive gain (loss). . . . . . . . . . . . . . . . . . . . .            113            (136)
Accumulated deficit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       (150,658)       (141,692)
                                                                                      --------------  --------------
      Total shareholders' deficit. . . . . . . . . . . . . . . . . . . . . . . . . .        (82,147)        (74,141)
                                                                                      --------------  --------------
      Total liabilities and shareholders' deficit. . . . . . . . . . . . . . . . . .  $     148,941   $     168,428
                                                                                      ==============  ==============
</TABLE>


      See accompanying Notes to Condensed Consolidated Financial Statements
                   and Management's Discussion  and  Analysis
               of  Financial  Condition  and  Results  of Operations
                                        1
<PAGE>

<TABLE>
<CAPTION>

                                         EMERITUS CORPORATION
                            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                              (unaudited)
                                 (In thousands, except per share data)

                                                Three Months ended            Six Months ended
                                                  June 30, 2002                 June 30,2002
                                           ----------------------------  ----------------------------
                                               2002           2001           2002           2001
                                           -------------  -------------  -------------  -------------
<S>                                        <C>            <C>            <C>            <C>
Revenues:
  Community revenue . . . . . . . . . . .  $     30,294   $     32,646   $     62,414   $     65,346
  Other service fees. . . . . . . . . . .         1,095            605          2,095          1,148
  Management fees . . . . . . . . . . . .         2,626          1,926          5,651          3,464
                                           -------------  -------------  -------------  -------------
          Total operating revenues. . . .        34,015         35,177         70,160         69,958

Expenses:
  Community operations. . . . . . . . . .        21,084         19,900         41,646         40,547
  General and administrative. . . . . . .         4,867          4,670          9,790          8,837
  Depreciation and amortization . . . . .         1,675          1,856          3,526          3,672
  Facility lease expense. . . . . . . . .         7,410          6,847         14,138         13,679
                                           -------------  -------------  -------------  -------------
          Total operating expenses. . . .        35,036         33,273         69,100         66,735
                                           -------------  -------------  -------------  -------------
          Income (loss) from operations .        (1,021)         1,904          1,060          3,223

Other income (expense):
  Interest income . . . . . . . . . . . .           113            318            222            558
  Interest expense. . . . . . . . . . . .        (2,852)        (3,535)        (5,778)        (7,068)
  Other, net. . . . . . . . . . . . . . .          (174)          (109)          (741)          (252)
                                           -------------  -------------  -------------  -------------
          Net other expense . . . . . . .        (2,913)        (3,326)        (6,297)        (6,762)
                                           -------------  -------------  -------------  -------------

          Net loss. . . . . . . . . . . .        (3,934)        (1,422)        (5,237)        (3,539)

Preferred stock dividends . . . . . . . .         1,732          1,620          3,729          3,231
                                           -------------  -------------  -------------  -------------
          Net loss to common shareholders  $     (5,666)  $     (3,042)  $     (8,966)  $     (6,770)
                                           =============  =============  =============  =============

Loss per common share - basic and diluted  $      (0.56)  $      (0.30)  $      (0.88)  $      (0.67)
                                           =============  =============  =============  =============

Weighted average number of common shares
    outstanding - basic and diluted . . .        10,200         10,151         10,198         10,136
                                           =============  =============  =============  =============
</TABLE>


      See accompanying Notes to Condensed Consolidated Financial Statements
                   and Management's Discussion  and  Analysis
               of  Financial  Condition  and  Results  of Operations
                                        2
<PAGE>

<TABLE>
<CAPTION>

                                                EMERITUS CORPORATION
                                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                    (unaudited)
                                                   (In thousands)

                                                                                   Six  Months  Ended  June  30,
                                                                               ------------------------------------
                                                                                     2002               2001
                                                                               -----------------  -----------------
<S>                                                                            <C>                <C>
Cash flows from operating activities:
  Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $         (5,237)  $         (3,539)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Minority interests. . . . . . . . . . . . . . . . . . . . . . . . . . . .               115                (96)
    Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . .             3,526              3,672
    Amortization of deferred gain . . . . . . . . . . . . . . . . . . . . . .              (149)              (380)
    Loss on sale of properties. . . . . . . . . . . . . . . . . . . . . . . .               515                  -
    Write off of deferred gain. . . . . . . . . . . . . . . . . . . . . . . .               (12)                 -
    Changes in operating assets and liabilities . . . . . . . . . . . . . . .              (477)            (1,419)
                                                                               -----------------  -----------------
          Net cash used in operating activities . . . . . . . . . . . . . . .            (1,719)            (1,762)
                                                                               -----------------  -----------------

Cash flows from investing activities:
  Acquisition of property and equipment . . . . . . . . . . . . . . . . . . .              (808)              (767)
  Acquisition of property held for development. . . . . . . . . . . . . . . .                 -                 (2)
  Purchase of minority partner interest . . . . . . . . . . . . . . . . . . .            (3,070)                 -
  Proceeds from sale of property and equipment. . . . . . . . . . . . . . . .            25,010              1,014
  Investment in lease acquisition costs . . . . . . . . . . . . . . . . . . .            (1,242)              (126)
  Repayments from (advances to) affiliates and other managed communities. . .              (501)             4,267
  Proceeds from sales of interest in affiliates . . . . . . . . . . . . . . .               750                  -
  Investment in affiliates. . . . . . . . . . . . . . . . . . . . . . . . . .              (107)                 -
  Distributions to minority partners. . . . . . . . . . . . . . . . . . . . .              (250)                 -
                                                                               -----------------  -----------------
          Net cash provided by investing activities . . . . . . . . . . . . .            19,782              4,386
                                                                               -----------------  -----------------

Cash flows from financing activities:
  Proceeds from sale of stock under employee stock purchase plan. . . . . . .                57                  -
  Decrease in restricted deposits . . . . . . . . . . . . . . . . . . . . . .               668                205
  Repayment of short-term borrowings. . . . . . . . . . . . . . . . . . . . .            (1,733)            (1,650)
  Debt issue and other financing costs. . . . . . . . . . . . . . . . . . . .            (1,516)                (7)
  Proceeds from long-term borrowings. . . . . . . . . . . . . . . . . . . . .            37,341                144
  Repayment of long-term borrowings . . . . . . . . . . . . . . . . . . . . .           (51,732)            (1,515)
                                                                               -----------------  -----------------
          Net cash used in financing activities . . . . . . . . . . . . . . .           (16,915)            (2,823)
                                                                               -----------------  -----------------

          Net increase (decrease) in cash and cash equivalents. . . . . . . .             1,148               (199)

Cash and cash equivalents at the beginning of the period. . . . . . . . . . .             9,811              7,496
                                                                               -----------------  -----------------

Cash and cash equivalents at the end of the period. . . . . . . . . . . . . .  $         10,959   $          7,297
                                                                               =================  =================

Supplemental disclosure of cash flow information cash paid during the period
    for interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $          6,926   $          7,023

Noncash investing and financing activities:
  Notes receivable from buyer in sale/leaseback . . . . . . . . . . . . . . .  $              -   $            635
  Assumption of debt by buyer in sale/leaseback . . . . . . . . . . . . . . .  $              -   $          3,162
  Unrealized holding gains in investment securities . . . . . . . . . . . . .  $            249   $            965
  Accrued preferred stock dividends . . . . . . . . . . . . . . . . . . . . .  $          3,729   $          3,231
</TABLE>


      See accompanying Notes to Condensed Consolidated Financial Statements
                   and Management's Discussion  and  Analysis
               of  Financial  Condition  and  Results  of Operations
                                        3
<PAGE>


                              EMERITUS CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)

CRITICAL  ACCOUNTING  POLICIES  AND  ESTIMATES

The preparation of condensed consolidated financial statements requires Emeritus
to  make  estimates  and  judgments  that affect the reported amounts of assets,
liabilities,  revenues and expenses, and related disclosure of contingent assets
and  liabilities.  On  an  ongoing  basis,  Emeritus  evaluates  its  estimates,
including  those  related  to  resident  programs  and  incentives,  bad  debts,
investments,  intangible  assets,  income  taxes,  financing  operations,
restructuring,  long-term  service  contracts,  contingencies,  insurance
deductibles,  and  litigation.  Emeritus  bases  its  estimates  on  historical
experience  and  on various other assumptions that are believed to be reasonable
under  the  circumstances,  the  results  of  which  form  the  basis for making
judgments  about  the  carrying  values  of  assets and liabilities that are not
readily  apparent  from  other  sources.  Actual  results  may differ from these
estimates  under  different  assumptions  or  conditions.

Emeritus  believes  the  following  critical  accounting  policies  are  most
significant  to  the  judgments  and  estimates  used  in the preparation of its
condensed  consolidated financial statements.  Emeritus maintains allowances for
doubtful  accounts  for  estimated  losses  resulting  from the inability of its
residents  to  make required payments.  If the financial condition of Emeritus's
residents  were  to  deteriorate, resulting in an impairment of their ability to
make  payments,  additional  charges  may  be  required.  Emeritus  utilizes
third-party  insurance  for  losses  and liabilities associated with general and
professional  liability claims subject to established deductible levels on a per
occurrence  basis.  Losses  up to these deductible levels are accrued based upon
Emeritus's  estimates  of the aggregate liability for claims incurred.  If these
estimates  are insufficient, additional charges may be required.  Emeritus holds
shares  in  ARV  Assisted  Living, Inc. amounting to less than 5% of its shares.
ARV  is  publicly  traded  and  has a volatile share price.  Emeritus records an
investment  impairment charge when it believes this investment has experienced a
decline in value that is other than temporary.  Future adverse changes in market
conditions  or poor operating results underlying this investment could result in
losses  or an inability to recover the carrying value of the investment that may
not  be  reflected in this investment's current carrying value, thereby possibly
requiring  an  impairment  charge  in  the future.  Emeritus records a valuation
allowance  to  reduce  its deferred tax assets to the amount that is more likely
than not to be realized, which at this time shows a net asset valuation of zero.
While  Emeritus  has  considered  future  taxable income and ongoing prudent and
feasible  tax  planning  strategies  in  assessing  the  need  for the valuation
allowance,  in  the  event  Emeritus  were to determine that it would be able to
realize  its  deferred  tax  assets  in the future in excess of its net recorded
amount,  an  adjustment  to  the deferred tax asset would increase income in the
period  such  determination  was  made.

BASIS  OF  PRESENTATION

The  unaudited  interim financial information furnished below, in the opinion of
the  Company's management, reflects all adjustments, consisting of only normally
recurring  adjustments,  which  are  necessary  to  state  fairly  the condensed
consolidated  financial  position,  results  of  operations,  and  cash flows of
Emeritus  as  of  June 30, 2002, and for the three and six months ended June 30,
2002  and  2001.  The Company presumes that those reading this interim financial
information  have read or have access to its 2001 audited consolidated financial
statements  and  Management's Discussion and Analysis of Financial Condition and
Results  of  Operations that are contained in the 2001 Form 10-K filed March 29,
2002,  and  amended  on  April  30,  2002.  Therefore,  the  Company has omitted
footnotes  and  other  disclosures herein, which are disclosed in the Form 10-K.

DEFERRED  REVENUE

At  June  30,  2002,  deferred  revenue of $2.5 million consists of the unearned
portion  of  the  insurance  surcharge  and fees charged for move-in services as
discussed  below.

                                        4
<PAGE>
                              EMERITUS CORPORATION
         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-CONTINUED
                                   (unaudited)


Due to dramatic increases in liability insurance premiums for the year 2002, the
Company  decided  to  institute  a  one-time  insurance  surcharge  and  billed
approximately  $1.4  million  to  the  residents of its communities in the first
quarter  of 2002.  The associated revenue is being recognized on a straight-line
basis  over  the  life  of  the  insurance  policy.

In  2001  and prior years, the Company recognized nonrefundable fees charged for
move-in  services  at  the  time  the resident occupied the unit and the related
services  were  performed.  This  treatment  was  not  materially different than
recognition  of  such  fees  over  the average period of occupancy.  However, in
2002,  the Company began charging significantly higher fees for move-in services
than  were  previously  charged.  Therefore, the Company has instituted a policy
consistent  with  SEC  Staff  Accounting  Bulletin 101 "Revenue Recognition", to
defer  such  fees  and  recognize  them  over  the  average period of occupancy,
approximately  16 months.  This resulted in deferring approximately $1.8 million
of  revenue  at June 30, 2002, of which $1.2 million and $800,000 relate to fees
charged  in  the  six-month  and  three-month  periods  ended  June  30,  2002,
respectively.  The  Company  has  not  deferred any of the costs incurred in the
performance  of  the  move-in  services.

EMERITRUST  TRANSACTIONS

The  Company  manages  46 communities referred to as the Emeritrust communities,
including  25  Emeritrust  I communities, 16 Emeritrust II Operating communities
and  five  Emeritrust  II  Development  communities, under management agreements
described  in  the  Company's  Annual  Report  on  Form  10-K for the year ended
December  31,  2001.  The  Company  does  not  recognize  management fees on the
Emeritrust  communities  as  revenue  in  its  condensed  consolidated financial
statements  to  the  extent  that  it  is funding the cash operating losses that
include  them,  although the amounts of the funding obligation each year include
management  fees  earned  by  Emeritus  under  the  management  agreements.
Correspondingly,  the  Company  recognizes  the  funding  obligation  under  the
agreement,  less  the applicable management fees, as an expense in its condensed
consolidated  financial statements under the category "Other, net".  Conversely,
if  the  applicable  management  fees exceed the funding obligation, the Company
recognizes  the  management  fees  less the funding obligation as management fee
revenue  in  its  condensed  consolidated  financial  statements.

For  the  three  months  ended June 30, 2002 and 2001, (i) total management fees
earned  and  recognized  as  revenue  for  the  Emeritrust  I  communities  were
approximately  $402,000  and  $579,000, respectively; (ii) total management fees
earned  for  the  Emeritrust  II  Development  communities  were  $229,000,  and
$126,000,  respectively,  of  which  $203,000  and  $108,000, respectively, were
recognized  as  revenue; and (iii) management fees earned and recognized for the
Emeritrust  II  Operating communities, for which there is no funding obligation,
were  $479,000 and $454,000, respectively.  Thus, the management fees recognized
for  all  of the Emeritrust communities decreased $57,000 for the second quarter
of  2002  compared  to  the  comparable  period  in  2001.
For  the  Emeritrust I communities there was no funding obligation for the three
months  ended June 30, 2002 and 2001.  The Company's funding obligations for the
Emeritrust  II  Development  communities  were $85,000 and $70,000 for the three
months  ended  June  30, 2002 and 2001, respectively.  Thus, the Company's gross
funding obligations increased $15,000 for the second quarter of 2002 compared to
the  comparable  period  in  2001.

For  the  six  months  ended  June  30, 2002 and 2001, (i) total management fees
earned for the Emeritrust I communities were approximately $1.1 million for both
periods,  of  which  $1.1 million and $875,000, respectively, were recognized as
revenue;  (ii)  total  management  fees earned for the Emeritrust II Development
communities  were  $397,000,  and  $240,000, respectively, of which $358,000 and
$185,000,  respectively,  were  recognized as revenue; and (iii) management fees
earned  and  recognized  for  the

                                        5
<PAGE>
Emeritrust  II  Operating communities, for which there is no funding obligation,
were  $965,000 and $919,000, respectively.  Thus, the management fees recognized
for  all  of  the  Emeritrust  communities  increased $444,000 for the first two
quarters  of  2002  compared  to  the  comparable  period  in  2001.

For  the  Emeritrust  I  communities there was no funding obligation for the six
months  ended  June 30, 2002, compared to $387,000 for the six months ended June
30,  2001.  The  Company's funding obligations for the Emeritrust II Development
communities  were  $121,000  and $218,000 for the six months ended June 30, 2002
and 2001, respectively.  Thus, the Company's gross funding obligations decreased
$484,000 for the first two quarters of 2002 compared to the comparable period in
2001.

PROPERTY  HELD  FOR  SALE

Emeritus  currently  has  two  properties  being  held  for  sale.  Assets to be
disposed  of  are  reported at the lower of their carrying amount or fair market
value  less  costs  to  sell.

PROPERTY  AND  EQUIPMENT

In  March 2002, the Company entered into a 15-year master lease arrangement with
Health  Care  REIT, Inc. ("HC REIT") for four communities, two of which Emeritus
previously  held  an ownership interest in and two of which it previously leased
from  another  lessor.  With  respect  to  one  community, located in Fairfield,
California,  the  Company  held  a  50%  economic  interest with a related party
investor,  which  was  owned or controlled by Daniel R Baty, the Company's chief
executive  officer.  Concurrently  with  the closing of the HC REIT transaction,
Emeritus  purchased  the  related  party  investor's  economic  interest for his
investment basis of $2.1 million plus a 9% return, a $2.95 million total payment
and  then sold the Fairfield facility to HC REIT.  The Company recognized a loss
on  the  repurchase of approximately $158,000, which is included in "Other, net"
in  the condensed consolidated statements of operations for the six months ended
June  30,  2002.  Another community, located in Paso Robles, California, was 50%
owned by an outside investor.  Also concurrently with the closing of the HC REIT
transaction,  the Company purchased the remaining 50% interest in this community
for  $2.65  million  and  then  sold  the  Paso Robles facility to HC REIT.  The
remaining  two  communities,  located  in  Hattiesburg, Mississippi, and Urbana,
Illinois, were both under operating leases with a different lessor, which agreed
to  convey  those communities directly to HC REIT. Concurrently with the closing
of  these  four  purchase  and sale transactions, Emeritus entered into a master
lease arrangement with HC REIT for all four communities and recognized a loss of
approximately  $372,000,  which  is  recorded  in  "Other, net" in the condensed
consolidated  statements  of  operations for the six months ended June 30, 2002.
The  loss  is  primarily comprised of write-offs of existing loan fees and lease
acquisition  costs  for  the  four  buildings.  Additionally,  the Company had a
deferred  gain  on  sale  associated with the transaction that approximated $1.8
million  and  new  lease  acquisition  costs of $1.0 million that are both being
amortized  over  the  lease  period  of  15  years.

In  April  2002,  the  Company  entered into agreements to acquire the ownership
interest  of  one  community and the leasehold interest of seven communities for
the  assumption  of  the  mortgage  debt relating to the owned community and the
lease  obligations  relating  to the leased communities.  The eight communities,
comprising  617  units  in  Louisiana and Texas, had been operated previously by
Horizon  Bay  Management  L.L.C.,  a national seniors housing management company
that  manages  the  WHSLH Realty, L.L.C. portfolio of senior housing properties.
In  May  and  July, 2002, Emeritus assigned its rights under these agreements to
entities  wholly owned by Daniel R. Baty, the Company's chief executive officer,
and  entered  into  a five-year agreement expiring April 30, 2007, with the Baty
entities  to  manage  the  eight communities for a management fee of 5% of gross
revenue.  In  completing  the  agreements  with Horizon Bay, Mr. Baty personally
guaranteed  the  mortgage and lease obligations.  As a part of these agreements,
the  Company  has the right to acquire the interests of the Baty entities in the
eight  communities at any time prior to April 30, 2007, by assuming the mortgage
debt  and lease obligations and paying such Baty entities the amount of any cash
investment  in  the  communities,  plus  9%  per  annum.  In  the  acquisition
agreements,  Horizon  Bay  agreed to fund operating losses of the communities to
the  extent  of  $2.5  million  in  the  first  twelve  months

                                        6
<PAGE>
 and  $870,000  in  the  second  twelve months following the closing.  Under the
management  agreements  with  the Baty entities, Emeritus has agreed to fund any
operating  losses  in  excess  of  these  limits  over the five-year term of the
management  agreement.  We  recognized  management  fee revenue of approximately
$133,000  from  these  communities  for  the  quarter  ended  June  30,  2002.

ACCRUED  DIVIDENDS  ON  PREFERRED  STOCK
Since  the  third quarter of 2000, the Company has accrued its obligation to pay
cash  dividends  to both the Series A and Series B preferred shareholders, which
amounted  to  $10.5  million  at  June  30,  2002,  including  all penalties for
non-payment.  Since  dividends  on  the  Series  A  shares were not paid for six
consecutive  quarters,  the  Series  A dividends were calculated on a compounded
cumulative  basis,  retroactively in the first quarter of 2002.  This caused the
preferred  stock dividends to be approximately $498,000 higher for the first two
quarters  of  2002  as compared to the first two quarters of 2001.  In addition,
since  the  Company  had  not paid these dividends for more than six consecutive
quarters, both the Series A and Series B shareholders became entitled to appoint
one  additional  director each to the Company's board of directors. At this time
neither  of  the  Series  A  or  Series  B shareholders has chosen to appoint an
additional  director  to  the  Company's  Board.
Series  B dividends were to be paid in cash and in additional shares of Series B
preferred  stock.  For  the paid-in-kind dividends for the first two quarters of
2000,  609  shares  of  Series  B  preferred  stock were issued.  Since then, no
additional  shares  had  been  issued  until  after  the second quarter of 2002.
Effective  July  1,  2002,  2,533  additional shares were issued as paid-in-kind
dividends  to  cover  the  period  from  July  1,  2000,  through June 30, 2002.

LONG-TERM  DEBT

On  April 1, 2002, in conjunction with the HC REIT master lease transaction more
fully  discussed under "Property and Equipment" above, the Company received $6.7
million  in  proceeds  from  a  $6.8 million debt issuance under a separate loan
agreement  with HC REIT.  The loan agreement requires interest only payments and
bears  interest  at 12% per annum with fixed annual increases of 50 basis points
for  a  term  of  36  months.

The  current  portion  of  long-term  debt  at  June  30,  2002,  has  increased
approximately  $46.5  million  since December 31, 2001, primarily due to certain
debt  instruments  having  maturity  dates  prior  to  June  30,  2003.  Most
significantly,  these debt instruments are a $6.8 million note to GMAC, which is
due  February  1,  2003,  and  notes totaling $40.6 million to Deutsche Bank AG,
which  are  due  May  31,  2003.

LOSS  PER  SHARE

Basic  net  loss  per  share  is  computed  based  on  weighted  average  shares
outstanding  and excludes any potential dilution.  Diluted net loss per share is
computed  on the basis of the weighted average number of shares outstanding plus
dilutive  potential  common shares using the treasury stock method.  The capital
structure  of  Emeritus  includes  convertible  debentures,  redeemable  and
non-redeemable  convertible  preferred  stock,  common stock warrants, and stock
options.  The  assumed  conversion  and  exercise  of these securities have been
excluded  from  the calculation of diluted net loss per share since their effect
is  anti-dilutive.  The loss per common share was calculated on a dilutive basis
without consideration of 10,193,900 and 8,087,358 common shares at June 30, 2002
and  2001,  respectively,  related to outstanding options, warrants, convertible
debentures,  and  convertible  preferred  stock.

UNREALIZED  HOLDING  GAINS  ON  INVESTMENT  SECURITIES

The  change  in  unrealized  holding  gains  on  investment  securities  for the
six-month  period  ended  June  30,  2002, represents the change in value of the
Company's  investment  in  ARV  Assisted  Living,  Inc.

                                        7
<PAGE>


OTHER  COMPREHENSIVE  INCOME

Other comprehensive income includes the following transactions for the three and
six  month  period  ended  June  30,  2002  and  2001,  respectively:

<TABLE>
<CAPTION>

                                         Three Months ended June 30,           Six Months ended June 30,
                                  ------------------------------------  ------------------------------------
                                        2002               2001               2002               2001
                                  -----------------  -----------------  -----------------  -----------------
                                                                (In thousands)
<S>                               <C>                <C>                <C>                <C>
Net loss to common shareholders.  $         (5,666)  $         (3,042)  $         (8,966)  $         (6,770)
Other comprehensive income:
     Unrealized holding gains on
          investment securities.               121                861                249                965
                                  -----------------  -----------------  -----------------  -----------------
Comprehensive loss . . . . . . .  $         (5,545)  $         (2,181)  $         (8,717)  $         (5,805)
                                  =================  =================  =================  =================
</TABLE>

LIQUIDITY

The  Company  has  incurred significant operating losses since its inception and
has a working capital deficit of $59.2 million, although $2.5 million represents
deferred  revenues  and $10.5 million of preferred cash dividends is only due if
declared  by  the  Company's  board of directors.  To date, the Company has been
dependent  upon  third  party  financing  or  disposition  of  assets  to  fund
operations.  Management  intends to continue to refinance or restructure debt as
necessary.  The Company cannot, however, guaranty that third party financing and
refinancing  or  dispositions  of  assets  will  be available timely or on terms
acceptable  to  Emeritus.  In April 2002, the Company completed a lease and debt
transaction  having  a  beneficial  impact on working capital of $6.7 million in
conjunction  with  the  HC  REIT  master lease transaction, more fully discussed
elsewhere  in  the  Notes  to Condensed Consolidated Financial Statements and in
Management's  Discussion  and  Analysis  of  Financial  Condition and Results of
Operations.  With  respect to the $40.6 million of mortgage debt that matures on
May  31,  2003,  the  Company has been in discussions with the lender and others
regarding  restructuring  or  refinancing  the  debt  and,  although the Company
believes  the  issue  will be resolved prior to the maturity of this debt, there
has been no agreement reached at this time and the Company has no commitment for
refinancing.  If  the  Company  is unable to restructure or refinance this debt,
the  lender  could  declare  the  entire  amount  immediately due and payable at
maturity  and  could  begin  foreclosure  proceedings  with respect to the seven
assisted  living  properties  that  secure  this  debt.  In addition, this would
result  in  defaults  under  other  leases  and loan agreements.  Except for the
potential  financial  impact  of  being  unable  to refinance the aforementioned
mortgage  debt,  management  believes  Emeritus  has sufficient funds to sustain
operations  at  least  through  June  30,  2003.

RECLASSIFICATIONS

Certain  reclassifications of 2001 amounts have been made to conform to the 2002
presentation.

                                        8
<PAGE>


           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

OVERVIEW

Emeritus  is  a Washington corporation organized by Daniel R. Baty and two other
founders  in  1993.  In  November 1995, we completed our initial public offering
and  began  our  expansion  strategy.

Through  1998,  we  focused  on  rapidly  expanding  our  operations in order to
assemble  a  portfolio  of  assisted  living communities with a critical mass of
capacity.  We  pursued an aggressive acquisition and development strategy during
that  time,  acquiring 35 and developing 10 communities in 1996, acquiring 7 and
developing 20 communities in 1997, and developing 5 communities in 1998.  During
1999  and  continuing  through  2001,  we  substantially  reduced  our  pace  of
acquisition and development activities. During 2002 we have resumed pursuing, on
a  selective  basis, management contract and acquisition opportunities, which we
believe  will  be  beneficial  to  the  Company.

In  our  consolidated  portfolio,  exclusive of insurance surcharges, but giving
effect  to  the  deferral  of move-in fees, our rate enhancement program brought
about an increase in average monthly revenue per occupied unit to $2,514 for the
first two quarters of 2002 from $2,375 for the first two quarters of 2001.  This
represents  an  average revenue increase of $139 per month per occupied unit, or
5.9%.  The  average occupancy rate decreased to 81.5% for the first two quarters
of  2002  from  84.8%  for  the  first  two  quarters  of  2001.

In  our  total operated portfolio, which includes managed communities, exclusive
of  insurance surcharges, but giving effect to the deferral of move-in fees, our
rate  enhancement  program  brought about an increase in average monthly revenue
per  occupied  unit to $2,513 for the first two quarters of 2002 from $2,261 for
the  first two quarters of 2001.  This represents an average revenue increase of
$252  per  month  per  occupied  unit, or 11.1%.  The larger increase in average
monthly  revenue per occupied unit in our total portfolio as compared to that in
our  consolidated  portfolio  is partially due to the addition of 16 communities
previously  managed  by Regent Assisted Living, Inc., discussed more fully below
in "Other Transactions".  A majority of the Regent communities have Special Care
(Alzheimer's)  units,  which  have  a  significantly  higher  rental  rate  than
non-Special  Care  units.  The average occupancy rate decreased to 80.7% for the
first  two  quarters  of  2002  from  82.0%  for the first two quarters of 2001.

We intend to continue a selective growth strategy through acquiring and managing
new  communities  with  operating  characteristics  consistent  with our current
emphasis  on stabilizing occupancy and enhancing our operating model and service
offerings.

               [The rest of this page is intentionally left blank]


                                        9
<PAGE>
           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS -CONTINUED

<TABLE>
<CAPTION>


                                           As  of  June  30,     As  of  December  31,     As  of  June  30,
                                                  2002                    2001                    2001
                                         ----------------------  ----------------------  ----------------------
                                         Buildings     Units     Buildings     Units     Buildings     Units
                                         ----------  ----------  ----------  ----------  ----------  ----------
<S>                                      <C>         <C>         <C>         <C>         <C>         <C>
Owned (1) . . . . . . . . . . . . . . .         16       1,579           16       1,579         16       1,579
Leased (1). . . . . . . . . . . . . . .         44       3,716           42       3,444         44       3,629
Managed/Admin Services. . . . . . . . .         95       8,763           70       6,620         71       6,710
Joint Venture/Partnership . . . . . . .          3         333            5         605          5         605
                                         ----------  ----------  ----------  ----------  ----------  ----------
     Operated Portfolio . . . . . . . .        158      14,391          133      12,248        136      12,523

     Percentage increase (decrease) (2)       18.8%       17.5%      (2.2%)      (2.2%)        0.7%        0.9%

New Developments (3). . . . . . . . . .          -           -            -           -          2         220
                                         ----------  ----------  ----------  ----------  ----------  ----------
     Total. . . . . . . . . . . . . . .        158      14,391          133      12,248        138      12,743
                                         ----------  ----------  ----------  ----------  ----------  ----------

     Percentage increase (decrease) (2)       18.8%       17.5%      (3.6%)      (3.9%)        0.7%        1.0%
</TABLE>
--------
(1)  Included  in  our  consolidated  portfolio  of  communities.
(2)  The  percentage  increase  (decrease)  indicates  the change from the prior
period  reported,  or,  in  the case of June 30, 2001, from the end of the prior
year.
(3)  The communities under development at June 30, 2001, were developed by third
parties,  but  are  currently  managed  by  Emeritus.

We rely primarily on our residents' ability to pay our charges for services from
their  own  or  familial  resources  and  expect  that  we  will  do  so for the
foreseeable  future.  Although care in an assisted living community is typically
less  expensive  than  in  a skilled nursing facility, we believe that generally
only  seniors with income or assets meeting or exceeding the regional median can
afford  to  reside  in  our  communities.  Inflation or other circumstances that
adversely  affect  seniors'  ability  to  pay for assisted living services could
therefore  have  an  adverse  effect  on  our  business.  All  sources  of
resident-related revenue other than residents' private resources constitute less
than  10%  of  our  total  revenues.

We  have  incurred  net  operating losses since our inception and as of June 30,
2002,  we  had  an  accumulated  deficit of approximately $150.7 million.  These
losses  resulted  from  a  number  of  factors,  including:

* occupancy levels at our communities that were lower for longer periods than we
originally  anticipated  and have declined in the last two years consistent with
industry  patterns;

*  financing  costs  that  we  incurred  as  a  result of multiple financing and
refinancing  transactions;  and

*  administrative  and  corporate  expenses  that we increased to facilitate our
growth  and  maintain  operations.

During  1998,  we  decided  to reduce acquisition and development activities and
dispose of select communities that had been operating at a loss. We believe that
slowing  our  acquisition  and  development activities has enabled us to use our
resources  more  efficiently  and  increase  our  focus  on  enhancing community
operations.

                                       10
<PAGE>


EMERITRUST  TRANSACTIONS

We manage 46 communities referred to as the Emeritrust communities, including 25
Emeritrust  I  communities,  16  Emeritrust  II  Operating  communities and five
Emeritrust  II Development communities, under management agreements described in
our  Annual Report on Form 10-K for the year ended December 31, 2001.  We do not
recognize  management  fees  on  the  Emeritrust  communities  as revenue in our
condensed  consolidated  financial  statements to the extent that we are funding
the cash operating losses that include them, although the amounts of the funding
obligation  each  year include management fees earned by us under the management
agreements.  Correspondingly,  we  recognize  the  funding  obligation under the
agreement,  less  the applicable management fees, as an expense in our condensed
consolidated  financial statements under the category "Other, net".  Conversely,
if  the  applicable  management fees exceed the funding obligation, we recognize
the management fees less the funding obligation as management fee revenue in our
condensed  consolidated  financial  statements.

For  the  three  months  ended June 30, 2002 and 2001, (i) total management fees
earned  and  recognized  as  revenue  for  the  Emeritrust  I  communities  were
approximately  $402,000  and  $579,000, respectively; (ii) total management fees
earned  for  the  Emeritrust  II  Development  communities  were  $229,000,  and
$126,000,  respectively,  of  which  $203,000  and  $108,000, respectively, were
recognized  as  revenue; and (iii) management fees earned and recognized for the
Emeritrust  II  Operating communities, for which there is no funding obligation,
were  $479,000 and $454,000, respectively.  Thus, the management fees recognized
for  all  of the Emeritrust communities decreased $57,000 for the second quarter
of  2002  compared  to  the  comparable  period  in  2001.
For  the  Emeritrust I communities there was no funding obligation for the three
months ended June 30, 2002 and 2001.  Our funding obligations for the Emeritrust
II  Development  communities were $85,000 and $70,000 for the three months ended
June  30,  2002  and  2001,  respectively.  Thus,  our gross funding obligations
increased  $15,000  for  the  second  quarter of 2002 compared to the comparable
period  in  2001.

For  the  six  months  ended  June  30, 2002 and 2001, (i) total management fees
earned for the Emeritrust I communities were approximately $1.1 million for both
periods,  of  which  $1.1 million and $875,000, respectively, were recognized as
revenue;  (ii)  total  management  fees earned for the Emeritrust II Development
communities  were  $397,000,  and  $240,000, respectively, of which $358,000 and
$185,000,  respectively,  were  recognized as revenue; and (iii) management fees
earned  and  recognized  for  the Emeritrust II Operating communities, for which
there is no funding obligation, were $965,000 and $919,000, respectively.  Thus,
the  management  fees recognized for all of the Emeritrust communities increased
$444,000 for the first two quarters of 2002 compared to the comparable period in
2001.

For  the  Emeritrust  I  communities there was no funding obligation for the six
months  ended  June 30, 2002, compared to $387,000 for the six months ended June
30, 2001.  Our funding obligations for the Emeritrust II Development communities
were  $121,000  and  $218,000  for  the six months ended June 30, 2002 and 2001,
respectively.  Thus,  our  gross  funding obligations decreased $484,000 for the
first  two  quarters  of  2002  compared  to  the  comparable  period  in  2001.

OTHER  TRANSACTIONS

In  January  2002, we entered into management and accounting services agreements
with  Regent  Assisted  Living,  Inc.  of Portland, Oregon, to manage or provide
administrative  services  to 18 of their communities. The agreements provide for
the  Company  receiving a fixed base management/service fee with some agreements
having  provisions for incentive fees based upon improved community performance.
In  February  2002,  two of the communities were sold to a third party, owned or
controlled by Dan Baty. Concurrently, we entered into agreements with these Baty
entities  to  continue  managing  these communities for 5% of gross revenues. In
March  2002,  we  began  managing  one  additional  Regent  community.  In April

                                       11
<PAGE>

2002,  one  community  that  we had been managing for Regent was sold to another
entity  and our management agreement terminated. Management fees recognized from
managing  the  Regent  communities  were approximately $743,000 in the first two
quarters  of  2002.

In  March  2002,  we entered into a 15-year master lease arrangement with Health
Care  REIT,  Inc.  ("HC  REIT") for four communities, two of which we previously
held an ownership interest in and two of which we previously leased from another
lessor.  With  respect  to  one  community, located in Fairfield, California, we
held  a  50% economic interest with a related party investor, which was owned or
controlled by Daniel R Baty, our chief executive officer.  Concurrently with the
closing  of  the  HC REIT transaction, we purchased the related party investor's
economic  interest  for his investment basis of $2.1 million plus a 9% return, a
$2.95 million total payment and then sold the Fairfield facility to HC REIT.  We
recognized a loss on the repurchase of approximately $158,000, which is included
in  "Other,  net" in the condensed consolidated statements of operations for the
six  months  ended  June  30,  2002.  Another community, located in Paso Robles,
California,  was  50%  owned by an outside investor.  Also concurrently with the
closing  of  the HC REIT transaction, we purchased the remaining 50% interest in
this  community  for  $2.65 million and then sold the Paso Robles facility to HC
REIT.  The  remaining  two communities, located in Hattiesburg, Mississippi, and
Urbana,  Illinois,  were  both  under  operating leases with a different lessor,
which agreed to convey those communities directly to HC REIT.  Concurrently with
the  closing  of  these  four  purchase and sale transactions, we entered into a
master  lease arrangement with HC REIT for all four communities and recognized a
loss  of  approximately  $372,000,  which  is  recorded  in  "Other, net" in the
condensed  consolidated  statements  of operations for the six months ended June
30,  2002.  The  loss is primarily comprised of write-offs of existing loan fees
and  lease  acquisition  costs  for  the four buildings.  Additionally, we had a
deferred  gain  on  sale  associated with the transaction that approximated $1.8
million  and  new  lease  acquisition  costs of $1.0 million that are both being
amortized  over  the  lease  period  of  15  years.

In  April  2002, we entered into agreements to acquire the ownership interest of
one community and the leasehold interest of seven communities for the assumption
of  the  mortgage debt relating to the owned community and the lease obligations
relating to the leased communities.  The eight communities, comprising 617 units
in  Louisiana  and Texas, had been operated previously by Horizon Bay Management
L.L.C.,  a  national  seniors  housing management company that manages the WHSLH
Realty,  L.L.C.  portfolio of senior housing properties.  In May and July, 2002,
we assigned our rights under these agreements to entities wholly owned by Daniel
R. Baty, the our chief executive officer, and entered into a five-year agreement
expiring  April 30, 2007, with the Baty entities to manage the eight communities
for  a management fee of 5% of gross revenue.  In completing the agreements with
Horizon  Bay, Mr. Baty personally guaranteed the mortgage and lease obligations.
As a part of these agreements, we have the right to acquire the interests of the
Baty  entities  in the eight communities at any time prior to April 30, 2007, by
assuming  the  mortgage debt and lease obligations and paying such Baty entities
the amount of any cash investment in the communities, plus 9% per annum.  In the
acquisition  agreements,  Horizon  Bay  agreed  to  fund operating losses of the
communities  to  the  extent  of  $2.5  million  in  the first twelve months and
$870,000  in  the  second  twelve  months  following  the  closing.  Under  the
management  agreements  with  the Baty entities, Emeritus has agreed to fund any
operating  losses  in  excess  of  these  limits  over the five-year term of the
management  agreement.  We  recognized  management  fee revenue of approximately
$133,000  from  these  communities  for  the  quarter  ended  June  30,  2002.


RESULTS  OF  OPERATIONS

Critical  Accounting  Policies  and  Estimates.

Management's  discussion  and analysis of our financial condition and results of
operations are based upon our condensed consolidated financial statements, which
have  been  prepared in accordance with accounting principles generally accepted
in  the United States. The preparation of these financial statements requires us

                                       12
<PAGE>

to  make  estimates  and  judgments  that affect the reported amounts of assets,
liabilities,  revenues and expenses, and related disclosure of contingent assets
and liabilities. On an ongoing basis, we evaluate our estimates, including those
related  to resident programs and incentives, bad debts, investments, intangible
assets,  income  taxes,  financing  operations, restructuring, long-term service
contracts,  contingencies,  insurance  deductibles  and  litigation. We base our
estimates  on  historical  experience  and  on various other assumptions that we
believe  to be reasonable under the circumstances, the results of which form the
basis  for  making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these  estimates  under  different  assumptions  or  conditions.

We  believe  the  following critical accounting policies are more significant to
the  judgments  and  estimates  used  in  the  preparation  of  our  condensed
consolidated  financial  statements.  Revisions in such estimates are charged to
income  in  the  period in which the facts that give rise to the revision become
known.  We  maintain  allowances  for  doubtful  accounts  for  estimated losses
resulting from the inability of our residents to make required payments.  If the
financial  condition  of  our  residents  were  to  deteriorate, resulting in an
impairment  of  their  ability  to  make  payments, additional allowances may be
required.  We  utilize  third-party  insurance  for  losses  and  liabilities
associated with general and professional liability claims subject to established
deductible  levels  on  a  per  occurrence basis.  Losses up to these deductible
levels  are  accrued  based upon Emeritus's estimates of the aggregate liability
for  claims  incurred.  If  these estimates are insufficient, additional charges
may  be required.  We hold shares in ARV Assisted Living, Inc. amounting to less
than  5%  of its shares.  ARV is publicly traded and has a volatile share price.
We  record  an  investment impairment charge when we believe this investment has
experienced  a  decline  in  value that is other than temporary.  Future adverse
changes  in  market  conditions  or  poor  operating  results  underlying  this
investment  could result in losses or an inability to recover the carrying value
of  the  investment  that  may  not  be  reflected  in this investment's current
carrying  value,  thereby possibly requiring an impairment charge in the future.
We  record a valuation allowance to reduce our deferred tax assets to the amount
that  is  more  likely  than  not to be realized, which at this time shows a net
asset  valuation  of  zero.  While  we have considered future taxable income and
ongoing prudent and feasible tax planning strategies in assessing the need for a
valuation  allowance, in the event we were to determine that we would be able to
realize  our  deferred  tax  assets  in the future in excess of our net recorded
amount,  an  adjustment  to  the deferred tax asset would increase income in the
period  such  determination  was  made.

               [The rest of this page is intentionally left blank]

                                       13
<PAGE>
The  following  table  sets forth, for the periods indicated, certain items from
our  Condensed  Consolidated  Statements  of Operations as a percentage of total
revenues  and the percentage change of the dollar amounts from period to period.

<TABLE>
<CAPTION>

                                                                                                      Period-to-Period
                                                                                                        Percentage
                                                                                                          Increase
                                                       Percentage  of  Revenues                          (Decrease)
                                     ----------------------------------------------------------  ----------------------------
                                            Three  Months                   Six  Months          Three  Months   Six  Months
                                                ended                         ended                  ended         ended
                                               June  30,                     June  30,             June  30,      June  30,
                                     ----------------------------  ----------------------------
                                         2002           2001           2002           2001         2001-2002      2001-2002
                                     -------------  -------------  -------------  -------------  -------------  -------------
<S>                                  <C>            <C>            <C>            <C>            <C>            <C>
Revenues. . . . . . . . . . . . . .         100.0%         100.0%         100.0%         100.0%         (3.3%)           0.3%
Expenses:
     Community operations . . . . .          62.0           56.6           59.4           58.0            5.9            2.7
     General and administrative . .          14.3           13.3           14.0           12.6            4.2           10.8
     Depreciation and amortization.           4.9            5.3            5.0            5.2           (9.8)          (4.0)
     Facility lease expense . . . .          21.8           19.5           20.2           19.6            8.2            3.4
                                     -------------  -------------  -------------  -------------  -------------  -------------
         Total operating expenses .         103.0           94.6           98.5           95.4            5.3            3.5
                                     -------------  -------------  -------------  -------------  -------------  -------------
Income (loss) from operations . . .          (3.0)           5.4            1.5            4.6         (153.6)         (67.1)
Other income (expense)
     Interest income. . . . . . . .           0.3            0.9            0.3            0.8          (64.5)         (60.2)
     Interest expense . . . . . . .          (8.4)         (10.0)          (8.2)         (10.1)         (19.3)         (18.3)
     Other, net . . . . . . . . . .          (0.5)          (0.3)          (1.1)          (0.4)          59.6          194.0

                                       13
<PAGE>

                                     -------------  -------------  -------------  -------------  -------------  -------------
         Net other expense. . . . .          (8.6)          (9.5)          (9.0)          (9.7)         (12.4)          (6.9)
                                     -------------  -------------  -------------  -------------  -------------  -------------
         Net loss . . . . . . . . .        (11.6%)         (4.0%)         (7.5%)         (5.1%)         176.7%          48.0%
                                     =============  =============  =============  =============  =============  =============
</TABLE>

The  following  discussion  for the three and six months ended June 30, 2002, is
exclusive  of insurance surcharges and the move-in fee deferral unless otherwise
noted.

Comparison  of  the  three  months  ended  June  30,  2002  and  2001
---------------------------------------------------------------------

Total  Operating  Revenues:  Total operating revenues for the three months ended
June 30, 2002, decreased by $1.2 million to $34.0 million from $35.2 million for
the  comparable  period  in  2001,  or  3.3%.

The change in revenue is primarily the result of a decrease in community revenue
of  approximately  $2.4  million,  which  resulted  from  the combined effect of
several  factors.  In  2001,  we  disposed  of  two  communities, which were not
included  in  our  consolidated portfolio in the second quarter of 2002 but were
included  in  the  comparable quarter of 2001. In the second quarter of 2002, we
changed  our  accounting  method for resident move-in fees to amortize such fees
over  the  average period residents stay, where we had previously recognized all
fees  as  revenues upon payment. This change resulted in recording approximately
$1.8  million  of  deferred  revenue  at  June  30,  2002.  These decreases were
partially offset by the net effect of an increase in average monthly revenue per
unit  and  a  decrease  in  the occupancy rate. The occupancy rate decreased 3.3
percentage  points  to  81.0%  for the second quarter of 2002 from 84.3% for the
second  quarter  of  2001.  Average  monthly revenue per unit was $2,533 for the
second quarter of 2002 compared to $2,404 for the comparable quarter of 2001, an
increase  of  approximately  5.4%.

The  decrease  in  community  revenue  was  partially  offset  by an increase in
management  fee  revenue of $700,000 and other service fees of $490,000, most of
which  were  insurance  surcharges  of  approximately $342,000 recognized in the
second  quarter  of  2002.  Management  fee  revenue increased partly due to the
increased  number  of  communities  under  management  agreements.  In addition,
improved  performance  of managed communities allowed us to recognize additional
base  management  fees  and  performance-driven  contingent  management  fees.

Community  Operations:  Community  operating expenses for the three months ended
June  30, 2002, increased by $1.2 million to $21.1 million from $19.9 million in
the  second quarter of 2001, or 5.9%.  The change was comprised of a decrease of
$650,000  due  to  the disposal of two communities and an increase totaling $1.8
million,  primarily  due  to  increases in liability, workers' compensation, and
health  insurance  costs  of $1.1 million and added personnel expense associated
with  our  increasing  emphasis  on  dementia  care  (Alzheimer's).  Community
operating expenses as a percentage of total operating revenue increased to 58.9%
in  the  second  quarter  of  2002  from  56.6%  in  the second quarter of 2001.

General  and  Administrative:  General and administrative (G&A) expenses for the
three  months  ended June 30, 2002, increased $197,000 to $4.9 million from $4.7
million  for  the  comparable period in 2001, or 4.2%.  As a percentage of total
operating  revenues,  G&A expenses increased to 13.6% for the three months ended
June  30, 2002, compared to 13.3% for the three months ended June 30, 2001.  G&A
expenses  rose  primarily due to increases in the number of employees and normal
increases  in  employee  salaries.  Recent  growth  in total communities managed
through  additional  contracts  has  led  to  some  added  operational  and
administrative  employees.  Since  more  than half of the communities we operate
are  managed,  G&A  expense  as  a  percentage  of  operating  revenues  for all
communities,  including  managed  communities,  may  be  more  meaningful  for
industry-wide  comparisons.  These  percentages were 5.7% and 6.8% for the three
months  ended  June  30,  2002  and  2001,  respectively.

Depreciation  and  Amortization:  Depreciation  and  amortization  for the three
months  ended  June  30, 2002, was $1.7 million compared to $1.9 million for the
comparable  period  in  2001.  This  decrease  is  primarily  due  to  decreased
depreciable  assets  because  of  sales/leaseback  arrangements.  In  2002,
depreciation  and

                                       14
<PAGE>

amortization  represents  4.7% of total operating revenues, compared to 5.3% for
the  comparable  period in 2001. The decrease as a percentage of revenues is due
to  decreased depreciable assets. Facility Lease Expense: Facility lease expense
for  the  three  months  ended  June 30, 2002, was $7.4 million compared to $6.8
million for the comparable period of 2001, representing an increase of $563,000,
or 8.2%. While we leased 44 communities as of both June 30, 2002 and 2001, there
were changes in the composition of the leased communities during the periods. As
part  of  the  HC REIT transaction discussed above, we refinanced two previously
mortgaged  communities  with  leases.  Of  the total increase in operating lease
expense,  approximately two-thirds resulted from the refinancing and the balance
was  attributable  to  rent  escalation  provisions in existing leases. Facility
lease  expense  as a percentage of revenues was 20.7% for the three months ended
June  30,  2002,  and  19.5%  for  the  three  months  ended  June  30,  2001.

Interest  Income:  Interest income for the three months ended June 30, 2002, was
$113,000  versus  $318,000  for the comparable period of 2001.  This decrease is
primarily  attributable  to  smaller  balances  in  interest-bearing  notes from
affiliates, declining interest rates, and an adjustment in the second quarter of
2001  of  $122,000  increasing  interest  income  in  the  prior  period.

Interest  Expense:  Interest  expense  for the three months ended June 30, 2002,
was  $2.9  million  compared  to $3.5 million for the comparable period of 2001.
This  decrease of $683,000, or 19.3%, is attributable to lower interest rates on
our  variable  rate debt and to the sale/leaseback of two communities as part of
the  master  lease  arrangement  with  HC  REIT, discussed above, which replaced
mortgage  interest  with new operating lease payments.  As a percentage of total
operating  revenues, interest expense decreased to 8.0% from 10.0% for the three
months  ended  June  30,  2002 and 2001, respectively, reflecting lower interest
rates  .

Preferred  dividends:  For  the  three  months ended June 30, 2002 and 2001, the
preferred  dividends  were  approximately  $1.7  million  and  $1.6  million,
respectively.  Since  dividends  on  the  Series  A shares were not paid for six
consecutive  quarters,  the  Series  A dividends were calculated on a compounded
cumulative  basis,  retroactively  in the first quarter of 2002. This caused the
preferred dividends to be approximately $112,000 higher in the second quarter of
2002  as  compared to the second quarter of 2001. In addition, since we have not
paid  these dividends for six consecutive quarters, both our Series A and Series
B  shareholders  became  entitled  to  elect one additional director each to our
board  of  directors  at each annual shareholders' meeting until such time as we
have  paid  the  accrued  dividends,  but  have  not  chosen  to  do  so.

 Comparison  of  the  six  months  ended  June  30,  2002  and  2001
 -------------------------------------------------------------------

Total  Operating  Revenues:  Total  operating  revenues for the six months ended
June 30, 2002, increased by $202,000 to $70.2 million from $70.0 million for the
comparable  period  in  2001,  or  0.3%.

The change in revenue is primarily the result of a decrease in community revenue
of  approximately  $2.9  million,  which  resulted  from  the combined effect of
several factors. In 2001, we disposed of three communities, the results of which
were  not  included  in  our consolidated portfolio in the first two quarters of
2002 but were included in the comparable quarters of 2001. In the second quarter
of  2002, we changed our accounting method for resident move-in fees to amortize
such  fees  over  the  average  period  residents  stay, where we had previously
recognized  all  fees as revenue upon payment. This change resulted in recording
approximately  $1.8 million of deferred revenue at June 30, 2002.  This decrease
was partially offset by the net effect of an increase in average monthly revenue
per  unit and a decrease in the occupancy rate. The occupancy rate decreased 3.3
percentage points to 81.5% for the first two quarters of 2002 from 84.8% for the
comparable  period  in 2001. Average monthly revenue per unit was $2,514 for the
first  two  quarters  of  2002 compared to $2,375 for the comparable quarters of
2001,  an  increase  of  approximately  5.9%.

                                       15
<PAGE>

The  decrease  in  community revenue was offset by an increase in management fee
revenue of $2.2 million and other service fee revenue of $950,000, most of which
were  insurance surcharges of approximately $683,000 recognized in the first two
quarters  of 2002.  Management fee revenue increased partly due to the increased
number  of  communities  under  management  agreements.  In  addition,  improved
performance  of  managed  communities  allowed  us  to recognize additional base
management  fees  and  performance-driven  contingent  management  fees.

Community  Operations:  Community  operating  expenses  for the six months ended
June  30, 2002, increased by $1.1 million to $41.6 million from $40.5 million in
the first two quarters of 2001, or 2.7%.  The change was comprised of a decrease
of  $1.0  million  due  to  the  disposal  of  three communities and an increase
totaling  $2.1  million,  primarily  due  to  increases  in  liability, workers'
compensation,  and  health  insurance  costs of $1.7 million and added personnel
expense  associated with our increasing emphasis on dementia care (Alzheimer's).
Community  operating  expenses  as  a  percentage  of  total  operating  revenue
decreased  to  57.9%  in  the  second  quarter  of 2002 from 58.0% in the second
quarter  of  2001.

General  and  Administrative:  General and administrative (G&A) expenses for the
six  months  ended  June  30, 2002, increased $953,000 to $9.8 million from $8.8
million  for  the comparable period in 2001, or 10.8%.  As a percentage of total
operating  revenues,  G&A  expenses  increased to 13.6% for the six months ended
June  30,  2002,  compared to 12.6% for the six months ended June 30, 2001.  G&A
expenses  rose  primarily  due  to  increases in the number of employees, normal
increases  in  employee  salaries, and costs related to various employee benefit
programs.   Recent  growth  in  total  communities  managed  through  additional
contracts  has  led  to  some  added  operational  and administrative employees.
Since more than half of the communities we operate are managed, G&A expense as a
percentage  of  operating  revenues  for  all  communities,  including  managed
communities,  may  be  more  meaningful  for  industry-wide  comparisons.  These
percentages  were 5.7% and 6.5% for the six months ended June 30, 2002 and 2001,
respectively.

Depreciation and Amortization:  Depreciation and amortization for the six months
ended June 30, 2002, was approximately $3.5 million compared to $3.7 million for
the six months ended June 30, 2001.  This decrease is primarily due to decreased
depreciable  assets  because  of  sales/leaseback  arrangements.   In  2002,
depreciation  and  amortization  represents  4.9%  of  total operating revenues,
compared  to  5.2%  for  the  comparable  period  in  2001.  The  decrease  as a
percentage  of  revenues  is  due  to decreased depreciable assets and increased
revenues.

Facility  Lease  Expense:  Facility  lease expense for the six months ended June
30,  2002, was $14.1 million compared to $13.7 million for the comparable period
of  2001,  representing  an  increase  of $459,000, or 3.4%.  While we leased 44
communities  as  of  both  June  30,  2002  and  2001, there were changes in the
composition  of  the  leased  communities  during  the periods.  The increase in
expense  was  primarily  due  to  lease escalator provisions in existing leases.
Facility  lease  expense  increases  associated  with  the  HC  REIT transaction
discussed  above,  were  offset through reduced costs from the disposal of three
communities  in  the  first, third, and fourth quarters of 2001.  Facility lease
expense  as  a  percentage  of  revenues  remained  virtually  unchanged and was
approximately  19.6%  for  the  six  months  ended  June  30,  2002  and  2001.
Interest  Income:  Interest  income  for the six months ended June 30, 2002, was
$222,000  versus  $558,000  for the comparable period of 2001.  This decrease is
primarily  attributable  to  smaller  balances  in  interest-bearing  notes from
affiliates, declining interest rates, and an adjustment in the second quarter of
2001  of  $122,000  increasing  interest  income  in  the  prior  period.

Interest  Expense:  Interest expense for the six months ended June 30, 2002, was
$5.8  million  compared  to $7.1 million for the comparable period of 2001. This
decrease  of  $1.3 million, or 18.3%, is attributable to lower interest rates on
our  variable  rate debt and to the sale/leaseback of two communities as part of
the  master  lease  arrangement with HC REIT, as discussed above, which replaced
mortgage  interest  with  new operating lease payments. As a percentage of total
operating  revenues,  interest  expense  decreased  to  8.0%

                                       16
<PAGE>

from  10.0%  for  the  six  months  ended  June 30, 2002 and 2001, respectively,
reflecting  increased  revenues  in conjunction with lower interest rates in the
first  two  quarters  of  2002.

Other,  net:  Other, net (expense) increased by $489,000 to $741,000 for the six
months  ended  June  30,  2002,  from $252,000 for the six months ended June 30,
2001.  The  net change is predominately comprised of the following items: During
the  first  two  quarters  of  2002,  we  repurchased a related party's economic
interest  in  a  172-unit  community  resulting  in  an  expense  of  $158,000.
Additionally,  the  sale/leaseback  of  two  communities  and  re-lease  of  two
additional  communities  resulted  in a transaction-related expense of $372,000,
for  a  combined  impact  of  $530,000 for the first two quarters of 2002. These
expenses  compare to sale/leaseback related gains in the two quarters ended June
30, 2001, of $189,000. This increase of $719,000 is offset by both a decrease of
$198,000 in our net funding obligation expense associated with our obligation to
fund  operating  deficits  of  the  Emeritrust  I  and Emeritrust II Development
communities  and  a  property  tax  refund  of  approximately  $64,000.

Preferred  dividends:  For  the  six  months  ended  June 30, 2002 and 2001, the
preferred  dividends  were  approximately  $3.7  million  and  $3.2  million,
respectively.  Since  dividends  on  the  Series  A shares were not paid for six
consecutive  quarters,  the  Series  A dividends were calculated on a compounded
cumulative  basis,  retroactively in the first quarter of 2002.  This caused the
preferred  dividends  to  be  approximately  $498,000  higher  in  the first two
quarters  of  2002  as compared to the first two quarters of 2001.  In addition,
since  we  have  not paid these dividends for six consecutive quarters, both our
Series  A  and  Series  B  shareholders  became entitled to elect one additional
director  each  to  our  board of directors at each annual shareholders' meeting
until such time as we have paid the accrued dividends, but have not chosen to do
so.

Same  Community  Comparison

We  operated  60  communities on a comparable basis during both the three months
ended  June  30,  2002 and 2001.  The following table sets forth a comparison of
same  community  results  of  operations,  excluding  general and administrative
expenses,  for  the  three  months  ended  June  30,  2002  and  2001.
<TABLE>
<CAPTION>

                                        Three Months ended June 30,
                                             (In thousands)
                                                            Dollar   Percentage
                                   2002          2001       Change     Change
                               ------------  ------------  --------  -----------
<S>                            <C>           <C>           <C>       <C>
Revenue . . . . . . . . . . .  $    31,241   $    32,131   $  (890)       (2.8%)
Community operating expenses.      (20,935)      (18,935)   (2,000)       (10.6)
                               ------------  ------------  --------  -----------
  Community operating income.       10,306        13,196    (2,890)       (21.9)
Depreciation & amortization .       (1,482)       (1,616)      134          8.3
Facility lease expense. . . .       (7,266)       (6,405)     (861)       (13.4)
                               ------------  ------------  --------  -----------
    Operating income. . . . .        1,558         5,175    (3,617)       (69.9)
Interest expense, net . . . .       (2,172)       (2,653)      481         18.1
Other income (expense). . . .           32           (92)      124          N/A
                               ------------  ------------  --------  -----------
    Net income (loss) . . . .  $      (582)  $     2,430   $(3,012)     (124.0%)
                               ============  ============  ========  ===========
</TABLE>

The  same communities represented $31.2 million or 91.8% of our total revenue of
$34.0 million for the second quarter of 2002.  Same community revenues decreased
by  $890,000  or  2.8%  for the quarter ended June 30, 2002, from the comparable
period  in  2001.  In  the  second  quarter of 2002, we began deferring resident
move-in fees to amortize such fees over the average period residents stay, where
we  had  previously recognized all fees as revenue upon payment.  Excluding this
deferral  of move-in fees, revenues would have increased approximately $903,000,
partially  due  to  insurance  surcharges to residents of approximately $338,000
recognized  in  the period and the combined effects of declines in occupancy and
rate  increases.  Average  occupancy decreased to 81.2% in the second quarter of
2002 from 84.6% in the second quarter of 2001.  Giving effect to the deferral of
move-in  fees,  average  revenue  per  unit  increased  by  5.3%.

                                       17
<PAGE>

Community  operating  expenses  increased  approximately  $2.0  million due to a
combination of factors, including higher liability insurance costs that were not
fully offset by rate surcharges, normal salary increases, increases in workman's
comp  charges,  health  insurance  and  other  employee costs, as well as normal
increases in other operating expense categories.  Occupancy expenses, consisting
of  facility  lease  expense, depreciation and amortization and interest expense
rose  approximately  $246,000  as  a  result  of  net  effect  of sale/leaseback
transactions  relating  to  two  communities,  rent  escalation related to other
communities  and  new  subordinated  debt  financing,  partially offset by lower
interest  rates.

For  the quarter ended June 30, 2002, net income decreased to a loss of $582,000
from  $2.4  million income for the comparable period of 2001, as a result of the
combined  effect  of  the  deferral  of  move-in fees and increases in community
operating  expenses.

LIQUIDITY  AND  CAPITAL  RESOURCES

For  the  six  months ended June 30, 2002, net cash used in operating activities
was $1.7 million compared to $1.8 million for the comparable period in the prior
year.  The  primary  components of operating cash used were the net loss of $5.2
million  and  the  net  increase  in  other  operating assets and liabilities of
$477,200,  partially  offset  by  depreciation and amortization of $3.5 million.
The  primary components of operating cash used for the six months ended June 30,
2001,  were  the  net  loss of $3.5 million, the net increase in other operating
assets  and  liabilities  of  $1.4 million, and amortization of deferred gain of
$380,000,  partially  offset  by  depreciation and amortization of $3.7 million.

Net  cash provided by investing activities amounted to $19.8 million for the six
months  ended  June  30,  2002, and was comprised primarily of funds from the HC
REIT  transaction  previously  discussed  under  "Other Transactions".  Net cash
provided  by  investing  activities  amounted to $4.4 million for the six months
ended  June  30,  2001,  and was comprised primarily of repayment of advances by
third  parties  and  affiliates  of  $4.3  million  and  proceeds  from  the
sale/leaseback  of  one community, which was partially offset by the acquisition
of  property  and  equipment  and  investment  in  lease  acquisition  costs.

For  the  six  months ended June 30, 2002, net cash used in financing activities
was  $16.9  million primarily from long-term debt repayments, which include debt
repayments  related to the HC REIT transaction previously discussed under "Other
Transactions", partially offset by decreases in restricted deposits and proceeds
of  long-term borrowings.  For the six months ended June 30, 2001, net cash used
in  financing  activities  was  $2.8  million  primarily  from  the repayment of
short-term  and  long-term  borrowings.

In  February 2002, through Heller Healthcare Finance, we refinanced three of the
properties  in  our $71.8 million Deutsche Bank AG loan portfolio.  The new loan
of  $30.6  million  matures  February  2004  and  provides for monthly principal
payments  of  approximately  $39,000  in addition to interest at LIBOR plus four
percent.  This  refinancing  in turn satisfied our extension agreement dated May
31,  2001,  with Deutsche Bank AG to extend to May 31, 2003 the maturity date of
the  remaining  $46.3  million  of debt, which is secured by the remaining seven
properties  in  the  original  portfolio.  The remaining balance of our Deutsche
Bank AG loan of $40.6 million was reclassified from long-term to current portion
of  long-term  debt  during  the  second  quarter  of  2002.

We  have  incurred  significant  operating losses since our inception and have a
working  capital  deficit  of  $59.2  million,  although $2.5 million represents
deferred  revenues  and $10.5 million of preferred cash dividends is only due if
declared  by our board of directors.  To date, we have been dependent upon third
party  financing  or  disposition  of  assets  to fund operations.  We intend to
continue  to  refinance  or restructure debt as necessary with our current third
party  lenders.  We  cannot,  however,  guaranty  that third party financing and
refinancing  or  dispositions  of  assets  will  be available timely or on terms
acceptable  to  us.  In  April  2002,  we completed a lease and debt transaction
having  a  beneficial  impact  on working capital of $6.7 million in conjunction
with  the HC REIT master lease transaction, more fully discussed in the

                                       18
<PAGE>

Notes  to  Condensed  Consolidated  Financial  Statements  and  elsewhere  in
Management's  Discussion  and  Analysis  of  Financial  Condition and Results of
Operations.  With  respect to the $40.6 million of mortgage debt that matures on
May  31,  2003, we have been in discussions with the lender and others regarding
restructuring or refinancing of the debt and, although we believe the issue will
be  resolved  prior  to  the  maturity of this debt, there has been no agreement
reached at this time and we have no commitment for refinancing. If we are unable
to  restructure  or  refinance  this  debt,  the lender could declare the entire
amount  immediately  due  and  payable  at  maturity and could begin foreclosure
proceedings  with  respect  to  the seven assisted living properties that secure
this debt. In addition, this default would result in defaults under other leases
and  loan  agreements. Except for the potential financial impact of being unable
to  refinance  the  aforementioned  mortgage debt, we believe we have sufficient
funds  to  sustain  operations  at  least  through  June  30,  2003.

Many  of  our  debt  instruments  and  leases contain "cross-default" provisions
pursuant  to  which a default under one obligation can cause a default under one
or  more other lease and loan obligations.  Such cross-default provisions affect
14  owned assisted living properties and 36 operated under leases.  Accordingly,
any  event  of  default  could  cause a material adverse effect on our financial
condition  if such debt or leases are cross-defaulted.  At June 30, 2002, we are
in  compliance  with  our  debt  and  lease  covenants.


IMPACT  OF  INFLATION

To  date,  inflation  has  not  had a significant impact on Emeritus.  Inflation
could,  however,  affect  our  future  revenues  and operating income due to our
dependence  on  the  senior resident population, most of whom rely on relatively
fixed  incomes  to  pay  for our services.  The monthly charges for a resident's
unit  and  assisted  living  services  are  influenced  by  the  location of the
community and local competition.  Our ability to increase revenues in proportion
to  increased  operating expenses may be limited.  We typically do not rely to a
significant  extent  on  governmental  reimbursement  programs.  In  pricing our
services,  we  attempt  to  anticipate  inflation  levels,  but  there can be no
assurance  that  we  will  be  able  to respond to inflationary pressures in the
future.

FORWARD-LOOKING  STATEMENTS

"Safe  Harbor"  Statement  under the Private Securities Litigation Reform Act of
1995:  A  number  of the matters and subject areas discussed in this report that
are  not  historical  or  contain  current  facts  deal  with  potential  future
circumstances,  operations,  and prospects.  The discussion of these matters and
subject  areas  is qualified by the inherent risks and uncertainties surrounding
future  expectations  generally,  and also may materially differ from our actual
future experience as a result of such factors as: the effects of competition and
economic  conditions  on  the  occupancy  levels in our communities; our ability
under current market conditions to maintain and increase our resident charges in
accordance  with  our  rate  enhancement  program  without  adversely  affecting
occupancy  levels;  our  ability to control community operation expenses without
adversely  affecting  the  level of occupancy and the level of resident charges;
the  ability  of  our operations to generate cash flow sufficient to service our
debt  and  other  fixed  payment  requirements;  our  ability to find sources of
financing and capital on satisfactory terms to meet our cash requirements to the
extent  that  they are not met by operations.  We have attempted to identify, in
context,  certain  of  the  factors  that  we currently believe may cause actual
future  experience and results to differ from our current expectations regarding
the  matter or subject area discussed in this report.  These and other risks and
uncertainties are detailed in our reports filed with the Securities and Exchange
Commission,  including  our Annual Reports on Form 10-K and Quarterly Reports on
Form  10-Q.

                                       19
<PAGE>

ITEM  3.   QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK

Our  earnings  are  affected  by  changes  in  interest rates as a result of our
short-term  and  long-term  borrowings.  We  manage this risk by obtaining fixed
rate  borrowings  when  possible. At June 30, 2002, our variable rate borrowings
totaled  approximately  $71.0 million.  If market interest rates were to average
2%  more,  our annual interest expense and net loss would increase approximately
$1.4  million.  This  amount  is  determined  by  considering  the  impact  of
hypothetical  interest  rates  on our outstanding variable rate borrowings as of
June  30,  2002, and does not consider changes in the actual level of borrowings
that  may  occur  subsequent  to  June  30,  2002.  This  analysis also does not
consider  the  effects  of  the  reduced level of overall economic activity that
could  exist in such an environment, or our current funding requirements for the
Emeritrust  communities,  nor  does it consider actions that management might be
able to take with respect to our financial structure to mitigate the exposure to
such  a  change.


                           PART II. OTHER INFORMATION


Items  1  through  5  are  not  applicable.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

(a) EXHIBITS:

<TABLE>
<CAPTION>

                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

<S>                                                                                                 <C>
  3.1      Restated Articles of Incorporation of registrant (Exhibit
           3.1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
  3.2      Amended and Restated Bylaws of the registrant (Exhibit
           3.2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1)
  4.1      Forms of 6.25% Convertible Subordinated Debenture due 2006
           (Exhibit 4.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
  4.2      Indenture dated February 15, 1996, between the registrant
           and Fleet National Bank ("Trustee") (Exhibit 4.2).. . . . . . . . . . . . . . . . . . .   (2)
  4.3      Preferred Stock Purchase Agreement (including Designation
           of Rights and Preferences of Series A Convertible
           Exchangeable Redeemable Preferred Stock of Emeritus
           Corporation Agreement, Registration of Rights Agreement and
           Shareholders Agreement) dated October 24, 1997, between the
           registrant ("Seller") and Merit Partners, LLC ("Purchaser")
           (Exhibit 4.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (12)
 10.1      Amended and Restated 1995 Stock Incentive Plan (Exhibit
           99.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (14)
 10.2      Stock Option Plan for Nonemployee Directors (Exhibit 10.2). . . . . . . . . . . . . . .   (2)
 10.3      Form of Indemnification Agreement for officers and
           directors of the registrant (Exhibit 10.3). . . . . . . . . . . . . . . . . . . . . . .   (1)
 10.4      Noncompetition Agreements entered into between the
           registrant and each of the following individuals:
           10.4.1   Daniel R. Baty (Exhibit 10.4.1), Raymond R.
                    Brandstrom (Exhibit 10.4.2) and Frank A. Ruffo
                    (Exhibit 10.4.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
 10.6      Form of Stock Purchase Agreement dated July 31, 1995,
           entered into between Daniel R. Baty and each of Michelle A.
           Bickford, Jean T. Fukuda, James S. Keller, George T. Lenes
           and Kelly J. Price (Exhibit 10.6).. . . . . . . . . . . . . . . . . . . . . . . . . . .   (1)

                                       20
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

 10.8      Scottsdale Royale in Scottsdale, Arizona, and Villa
           Ocotillo in Scottsdale, Arizona. The following agreements
           are representative of those executed in connection with
           these properties:
           10.8.1   Loan Agreement dated December 31, 1996, in the
                    amount of $12,275,000 by the registrant
                    ("Borrower") and Lender (Exhibit 10.9.1).. . . . . . . . . . . . . . . . . . .   (5)
           10.8.2   Promissory Note dated December 31, 1996, in the
                    amount of $5,500,000 between the registrant to
                    Bank United (the "Lender") with respect to
                    Scottsdale Royale and Villa Ocotillo (Exhibit
                    10.9.3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.8.3   Deed of Trust, Security Agreement, Assignment of
                    Leases and Rents, and Fixture Filing (Financial
                    Statement) dated as of December 31, 1996, by the
                    registrant, as Trustor and debtor, to Chicago
                    Title Insurance Company, as Trustee, for the
                    benefit of the Lender, Beneficiary and secured
                    party with respect to Scottsdale Royale and Villa
                    Ocotillo (Exhibit 10.9.4). . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
 10.9      Rosewood Court in Fullerton, California, the Arbor at Olive
           Grove in Phoenix, Arizona, Renton Villa in Renton,
           Washington, Seabrook in Everett, Washington, Laurel Lake
           Estates in Vorhees, New Jersey, Green Meadows--Allentown in
           Allentown, Pennsylvania, Green Meadows--Dover in Dover,
           Delaware, Green Meadows--Latrobe in Latrobe, Pennsylvania,
           Green Meadows--Painted Post in Painted Post, New York,
           Heritage Health Center in Hendersonville, North Carolina.
           The following agreements are representative of those
           executed in connection with these properties:
           10.9.1   Lease Agreement dated March 29, 1996, between the
                    registrant ("Lessee") and Health Care Property
                    Investors, Inc. ("Lessor") (Exhibit 10.10.1).. . . . . . . . . . . . . . . . .   (3)
           10.9.2   First Amendment Lease Agreement dated April 25,
                    1996, by and between the registrant ("Lessee")
                    and Health Care Property Investors, Inc.
                    ("Lessor") (Exhibit 10.10.2).. . . . . . . . . . . . . . . . . . . . . . . . .   (3)
 10.11     Summer Wind in Boise, Idaho
           10.11.1  Lease Agreement dated as of August 31, 1995,
                    between AHP of Washington, Inc. and the
                    registrant (Exhibit 10.18.1).. . . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.11.2  First Amended Lease Agreement dated as of
                    December 31, 1996, by and between the registrant
                    and AHP of Washington, Inc. (Exhibit 10.16.2). . . . . . . . . . . . . . . . .   (5)
 10.12     Silver Pines (formerly Willowbrook) in Cedar Rapids, Iowa
           10.12.1  Purchase and Sale Agreement (including Real
                    Estate Contract) dated January 4, 1995, between
                    Jabo, Ltd. ("Jabo") and the registrant (Exhibit
                    10.19.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.12.2  Assignment and Assumption Agreement with respect

                                       21
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    to facility leases dated as of January 17, 1995,
                    by and between Jabo, as Assignor, and the
                    registrant, as Assignee (Exhibit 10.19.2). . . . . . . . . . . . . . . . . . .   (1)
 10.13     The Palisades in El Paso, Texas, Amber Oaks in San Antonio,
           Texas and Redwood Springs in San Marcos, Texas. The
           following agreements are representative of those executed
           in connection with these properties.
           10.13.1  Lease Agreement dated April 1, 1997, between ESC
                    III, L.P. D/B/A Texas-ESC III, L.P. ("Lessee")
                    and Texas HCP Holding , L.P. ("Lessor") (Exhibit
                    10.4.1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.13.2  First Amendment to Lease Agreement dated April 1,
                    1997, between Lessee and Texas HCP Holding , L.P.
                    Lessor (Exhibit 10.4.2). . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.13.3  Guaranty dated April 1, 1997, by the registrant
                    ("Guarantor") in favor of Texas HCP Holding ,
                    L.P. (Exhibit 10.4.3). . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.13.4  Assignment Agreement dated April 1, 1997, between
                    the registrant ("Assignor") and Texas HCP Holding
                    , L.P. ("Assignee") (Exhibit 10.4.4).. . . . . . . . . . . . . . . . . . . . .   (6)
 10.14     Carriage Hill Retirement in Bedford, Virginia
           10.14.1  Lease Agreement dated August 31, 1994, between
                    the registrant, as Tenant, and Carriage Hill
                    Retirement of Virginia, Ltd. as Landlord (Exhibit
                    10.23.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.14.2  Supplemental Lease Agreement dated September 2,
                    1994 (Exhibit 10.23.2).. . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1)
 10.15     Green Meadows Communities
           10.15.1  Consent to Assignment of and First Amendment to
                    Asset Purchase Agreement dated September 1, 1995,
                    among the registrant, The Standish Care Company
                    and Painted Post Partnership, Allentown Personal
                    Car General Partnership, Unity Partnership,
                    Saulsbury General Partnership and P. Jules Patt
                    (collectively, the "Partnerships"), together with
                    Asset Purchase Agreement dated July 27, 1995,
                    among The Standish Care Company and the
                    Partnerships (Exhibit 10.24.1).. . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.15.2  Agreement to Provide Administrative Services to
                    an Adult Home dated October 23, 1995, between the
                    registrant and P. Jules Patt and Pamela J. Patt
                    (Exhibit 10.24.6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.15.3  Assignment Agreement dated October 19, 1995,
                    between the registrant, HCPI Trust and Health
                    Care Property Investors, Inc. (Exhibit 10.24.8). . . . . . . . . . . . . . . .   (1)
           10.15.4  Assignment and Assumption Agreement dated August
                    31, 1995, between the registrant and The Standish
                    Care Company (Exhibit 10.24.9).. . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.15.5  Guaranty dated October 19, 1995, by Daniel R.
                    Baty in favor of Health Care Property Investors,

                                       22
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    Inc., and HCPI Trust (Exhibit 10.24.10). . . . . . . . . . . . . . . . . . . .   (1)
           10.15.6  Guaranty dated October 19, 1995, by the
                    registrant in favor of Health Care Property
                    Investors, Inc. (Exhibit 10.24.11).. . . . . . . . . . . . . . . . . . . . . .   (1)
           10.15.7  Second Amendment to Agreement to provide
                    Administrative Services to an Adult Home dated
                    January 1, 1997, between Painted Post Partners
                    and the registrant (Exhibit 10.2). . . . . . . . . . . . . . . . . . . . . . .  (10)
 10.16     Carolina Communities
           10.16.1  Lease Agreement dated January 26, 1996, between
                    the registrant and HCPI Trust with respect to
                    Countryside Facility (Exhibit 10.23.1).. . . . . . . . . . . . . . . . . . . .   (2)
           10.16.3  Promissory Note dated as of January 26, 1996, in
                    the amount of $3,991,190 from Heritage Hills
                    Retirement, Inc. ("Borrower") to Health Care
                    Property Investors, Inc. ("Lender")
                    (Exhibit 10.23.4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
           10.16.4  Loan Agreement dated January 26, 1996, between
                    the Borrower and the Lender (Exhibit 10.23.5). . . . . . . . . . . . . . . . .   (2)
           10.16.5  Guaranty dated January 26, 1996, by the
                    registrant in favor of the Borrower (Exhibit
                    10.23.6).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
           10.16.6  Deed of Trust with Assignment of Rents, Security
                    Agreement and Fixture Filing dated as of January
                    26, 1996, by and among Heritage Hills Retirement,
                    Inc. ("Grantor"), Chicago Title Insurance Company
                    ("Trustee") and Health Care Property Investor,
                    Inc. ("Beneficiary") (Exhibit 10.23.7).. . . . . . . . . . . . . . . . . . . .   (2)
           10.16.7  Lease Agreement dated as of January 26, 1996,
                    between the registrant and Health Care Property
                    Investor, Inc. with respect to Heritage Lodge
                    Facility (Exhibit 10.23.8).. . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
           10.16.8  Lease Agreement dated as of January 26, 1996,
                    between the registrant and Health Care Property
                    Investor, Inc. with respect to Pine Park Facility
                    (Exhibit 10.23.9). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
           10.16.9  Lease Agreement dated January 26, 1996, between
                    the registrant and HCPI Trust with respect to
                    Skylyn Facility (Exhibit 10.23.10).. . . . . . . . . . . . . . . . . . . . . .   (2)
           10.16.10 Lease Agreement dated January 26, 1996, between
                    the registrant and HCPI Trust with respect to
                    Summit Place Facility (Exhibit 10.23.11).. . . . . . . . . . . . . . . . . . .   (2)
           10.16.11 Amendment to Deed of Trust dated April 25, 1996,
                    between Heritage Hills Retirement, Inc.
                    ("Grantor"), and Health Care Property Investors,
                    Inc. ("Beneficiary") (Exhibit 10.21.12). . . . . . . . . . . . . . . . . . . .   (5)
 10.17     Development Property in Fairfield, California
           10.17.1  Loan Agreement in the amount of $12,800,000 dated
                    January 10, 1997, between Fairfield Retirement
                    Center, LLC ("Borrower") and the Finova Capital

                                       23
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    Corporation ("Lender") (Exhibit 10.31.1).. . . . . . . . . . . . . . . . . . .   (5)
           10.17.2  Promissory Note dated January 10, 1997, in the
                    amount of $12,800,000 between Fairfield
                    Retirement Center, LLC ("Borrower") and Finova
                    Capital Corporation ("Lender") (Exhibit 10.31.2).. . . . . . . . . . . . . . .   (5)
           10.17.3  Deed of Trust, Security Agreement, Assignment
                    of Leases and Rents and Fixture Filing dated
                    January 10, 1997, between Fairfield Retirement
                    Center, LLC ("Trustor"), Chicago Title Company
                    ("Trustee") and Finova Capital Corporation
                    ("Beneficiary") (Exhibit 10.31.3). . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.17.4  Guaranty Agreement dated January 10, 1997,
                    between the registrant ("Guarantor") and Finova
                    Capital Corporation ("Lender") (Exhibit
                    10.31.4).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.17.5  Fairfield restructuring agreement between the registrant and
                    Fairfield Assisted Living, L.L.C., dated March 28, 2002. . . . . . . . . . . .  (25)
 10.18     Garrison Creek Lodge in Walla Walla, Washington, Cambria
           in El Paso Texas, and Sherwood Place in Odessa, Texas.
           The following agreements are representative of those
           executed in connection with these properties:
           10.18.1  Lease Agreement dated July, August and
                    September 1996, between the registrant
                    ("Lessee") and American Health Properties, Inc.
                    ("Lessor") (Exhibit 10.3.1). . . . . . . . . . . . . . . . . . . . . . . . . .   (4)
           10.18.2  First Amendment to Lease Agreement dated
                    December 31, 1996, between the registrant
                    ("Lessee") and AHP of Washington, Inc.,
                    ("Lessor") (Exhibit 10.35.2).. . . . . . . . . . . . . . . . . . . . . . . . .   (5)
 10.19     Cobblestone at Fairmont in Manassas, Virginia
           10.19.1  Loan Agreement effective as of October 26,
                    1995, between the registrant and Health Care
                    REIT, Inc. (Exhibit 10.42.1).. . . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.19.2  Deed of Trust, Security Agreement, Assignment
                    of Leases and Rents and Fixture Filing dated as
                    of October 26, 1995, by the registrant to
                    Health Care REIT, Inc. (Exhibit 10.42.2).. . . . . . . . . . . . . . . . . . .   (1)
           10.19.3  Note dated October 26, 1995, from the
                    registrant to Health Care REIT, Inc. (Exhibit
                    10.42.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.19.4  Unconditional and Continuing Guaranty dated as
                    of October 26, 1995, by Daniel R. Baty in favor
                    of Health Care REIT, Inc. (Exhibit 10.42.4). . . . . . . . . . . . . . . . . .   (1)
 10.20     Rosewood Court in Fullerton, California, The Arbor at
           Olive Grove in Phoenix, Arizona, Renton Villa in Renton,
           Washington, Seabrook in Everett, Washington and Laurel
           Lake Estates in Voorhees, New Jersey, Green Meadows--
           Allentown in Allentown, Pennsylvania, Green Meadows--
           Dover in Dover, Delaware, Green Meadows--Latrobe in
           Latrobe, Pennsylvania, Green Meadows--Painted Post in

                                       24
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

           Painted Post, New York. The following agreements are
           representative of those executed in connection with these
           properties:
           10.20.1  Second Amended Lease Agreement dated as of
                    December 30, 1996, by and between the
                    registrant and Health Care Property Investors,
                    Inc. (Exhibit 10.37.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
 10.21     Cooper George Partners Limited Partnership
           10.21.1  Deed of Trust, Trust Indenture, Assignment,
                    Assignment of Rents, Security Agreement,
                    Including Fixture Filing and Financing
                    Statement dated June 30, 1998, between Cooper
                    George Partners Limited Partnership
                    ("Grantor"), Chicago Title Insurance Company
                    ("Trustee") and Deutsche Bank AG, New York
                    Branch ("Beneficiary") (Exhibit 10.3.1). . . . . . . . . . . . . . . . . . . .  (15)
           10.21.2  Partnership Interest Purchase Agreement dated
                    June 4, 1998, between Emeritus Real Estate LLC
                    IV ("Seller") and Columbia Pacific Master Fund
                    98 General Partnership ("Buyer") (Exhibit
                    10.3.2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (15)
           10.21.3  Credit Agreement dated June 30, 1998, between
                    Cooper George Partners Limited Partnership
                    ("Borrower") and Deutsche Bank AG, New York
                    Branch ("Lender") (Exhibit 10.3.3).. . . . . . . . . . . . . . . . . . . . . .  (15)
           10.21.4  Amended and Restated Agreement of Limited
                    Partnership of Cooper George Partners Limited
                    Partnership dated June 29, 1998, between
                    Columbia Pacific Master Fund '98 General
                    Partnership, Emeritus Real Estate IV, L.L.C.
                    and Bella Torre De Pisa Limited Partnership
                    (Exhibit 10.3.4).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (15)
           10.21.5  Guaranty and Limited Indemnity Agreement dated
                    June 30, 1998, between Daniel R. Baty
                    ("Guarantor") and Deutsche Bank AG, New York
                    Branch ("Lender") (Exhibit 10.3.6).. . . . . . . . . . . . . . . . . . . . . .  (15)
           10.21.6  Promissory Note dated June 30, 1998, between
                    Cooper George Limited Partnership ("Borrower")
                    and Deutsche Bank, AG, New York Branch
                    ("Lender") (Exhibit 10.3.7). . . . . . . . . . . . . . . . . . . . . . . . . .  (15)
 10.22     Registration Rights Agreement dated February 8, 1996,
           with respect to the registrant's 6.25%
           Convertible Subordinated Debentures due 2006 (Exhibit
           10.44). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
 10.23     Registration Rights Agreement dated February 8, 1996,
           with respect to the registrant's 6.25%
           Convertible Subordinated Debentures due 2006 (Exhibit
           10.45). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2)
 10.24     Office Lease Agreement dated April 29, 1996, between
           Martin Selig ("Lessor") and the registrant ("Lessee")

                                       25
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

           (Exhibit 10.8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (3)
 10.25     Colonie Manor in Latham, New York, Bassett Manor in
           Williamsville, New York, West Side Manor in Liverpool, New
           York, Bellevue Manor in Syracuse, New York, Perinton Park
           Manor in Fairport, New York, Bassett Park Manor in
           Williamsville, New York, Woodland Manor in Vestal, New York,
           East Side Manor in Fayetteville, New York and West Side Manor
           in Rochester, New York. The following agreement is
           representative of those executed in connection with these
           properties:
           10.25.1  Lease Agreement dated September 1, 1996, between
                    Philip Wegman ("Landlord") and Painted Post
                    Partners ("Tenant") (Exhibit 10.4.1).. . . . . . . . . . . . . . . . . . . . .   (4)
           10.25.2  Agreement to Provide Administrative Services to an
                    Adult Home dated September 2, 1996, between the
                    registrant and Painted Post Partners ("Operator")
                    (Exhibit 10.4.2).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (4)
           10.25.3  First Amendment to Agreement to Provide
                    Administrative Services to an Adult Home dated
                    January 1, 1997, between Painted Post Partners and
                    the registrant (Exhibit 10.1). . . . . . . . . . . . . . . . . . . . . . . . .  (10)
 10.26     Columbia House Communities.
           10.26.1  Management Services Agreement between the
                    Registrant ("Manager") and Columbia House, LLC
                    ("Lessee") dated November 1, 1996, with respect to
                    Camlu Retirement (Exhibit 10.6.1). . . . . . . . . . . . . . . . . . . . . . .   (4)
           10.26.2  Management Services Agreement dated January 1,
                    1998, between the registrant ("Manager") and
                    Columbia House LLC ("Lessee") with respect to York
                    Care.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (13)
           10.26.3  Commercial Lease Agreement dated January 13, 1997,
                    between Albert M. Lynch ("Landlord") and Columbia
                    House, LLC ("Tenant") with respect to York Care
                    (Exhibit 10.3.2).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.26.4  Management Services Agreement dated June 1, 1997,
                    between the registrant ("Manager") and Columbia
                    House LLC ("Owner") with respect to Autumn Ridge
                    (Exhibit 10.3.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (9)
           10.26.5  Agreement to Provide Accounting and Administrative
                    Services dated October 1, 1997, between Acorn
                    Service Corporation ("Administrator") and Vancouver
                    Housing, L.L.C., ("Manager") with respect to Van
                    Vista and Columbia House (Exhibit 10.6.1). . . . . . . . . . . . . . . . . . .  (12)
           10.26.6  Assignment and First Amendment to Agreement to
                    Provide Management Services dated September 1,
                    1997, between the registrant, Columbia House,
                    L.L.C., Acorn Service Corporation and Camlu Coeur
                    d'Alene, L.L.C. with respect to Camlu. . . . . . . . . . . . . . . . . . . . .  (13)
           10.26.7  Assignment and First Amendment to Agreement to
                    Provide Management Services dated September 1,
                    1997, between the registrant, Columbia House,

                                       26
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    L.L.C., Acorn Service Corporation and Autumn Ridge
                    Herculaneum, L.L.C. with respect to Autumn Ridge.. . . . . . . . . . . . . . .  (13)
           10.26.8  Management Services Agreement dated January 1,
                    1998, between the registrant ("Manager") and
                    Columbia House LLC ("Owner") with respect to Park
                    Lane.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (13)
 10.27     Vickery Towers in Dallas, Texas
           10.27.1  Partnership Interest Purchase and Sale Agreement
                    dated June 4, 1998, between ESC GP II, Inc. and
                    Emeritus Properties IV, Inc. (together "Seller")
                    and Columbia Pacific Master Fund 98 General
                    Partnership and Daniel R. Baty (together
                    "Purchaser") (Exhibit 10.4.1). . . . . . . . . . . . . . . . . . . . . . . . .  (15)
           10.27.2  Amended and Restated Agreement of Limited
                    Partnership of ESC II, LP dated June 30, 1998,
                    between Columbia Pacific Master Fund '98 General
                    Partnership and Daniel R. Baty (Exhibit 10.4.2). . . . . . . . . . . . . . . .  (15)
           10.27.3  Agreement to Provide Management Services To An
                    Independent and Assisted Living Facility dated June
                    30, 1998, between ESC II, LP ("Owner") and ESC III,
                    LP ("Manager") (Exhibit 10.4.3). . . . . . . . . . . . . . . . . . . . . . . .  (15)
 10.28     Concorde in Las Vegas, Nevada
           10.28.1  Purchase and Sale Agreement dated July 9, 1996,
                    between the registrant ("Purchaser") and Sunday
                    Estates, Inc. ("Seller") (Exhibit 10.56.1).. . . . . . . . . . . . . . . . . .   (5)
           10.28.2  First Amendment to Purchase and Sale Agreement
                    dated July 11, 1996, between the registrant the
                    Seller (Exhibit 10.56.2).. . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
 10.29     Development Properties in Auburn, Massachusetts, Louisville,
           Kentucky and Rocky Hill, Connecticut. The following
           agreements are representative of those executed in connection
           with these properties:
           10.29.1  Lease Agreement dated February 1996, between the
                    registrant ("Lessee") and LM Auburn Assisted Living
                    LLC, and LM Louisville Assisted Living LLC,
                    ("Landlords") with respect to the development
                    properties in Auburn and Louisville (Exhibit
                    10.58.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.29.2  Amended and Restated Lease Agreement dated February
                    26, 1996, between the registrant ("Lessee") and LM
                    Rocky Hill Assisted Living Limited Partnership,
                    ("Landlord") with respect to the development
                    property in Rocky Hill (Exhibit 10.58.2).. . . . . . . . . . . . . . . . . . .   (5)
           10.29.3  Lease Agreement dated October 10, 1996, between the
                    registrant ("Lessee") and LM Chelmsford Assisted
                    Living LLC, ("Landlord") with respect to the
                    development property in Chelmsford (Exhibit
                    10.58.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.29.4  Promissory Note in the amount of $1,255,000 dated

                                       27
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    December 1996, between the registrant ("Lender")
                    and LM Auburn Assisted Living LLC, ("Borrower")
                    with respect to the development property in
                    Auburn (Exhibit 10.58.4).. . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.29.5  Promissory Note in the amount of $1,450,000 dated
                    January 1997, between the registrant ("Lender")
                    and LM Louisville Assisted Living LLC,
                    ("Borrower") with respect to the development
                    property in Louisville (Exhibit 10.58.5).. . . . . . . . . . . . . . . . . . .   (5)
           10.29.6  Promissory Note in the amount of $1,275,000 dated
                    January 1997, between the registrant ("Lender")
                    and LM Rocky Hill Assisted Living Limited
                    Liability Partnership, ("Borrower") with respect
                    to the development property in Rocky Hill
                    (Exhibit 10.58.6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.29.7  Promissory Note in the amount of $300,000 dated
                    January 1997, between the registrant ("Lender")
                    and LM Chelmsford Assisted Living LLC,
                    ("Borrower") with respect to the development
                    property in Chelmsford (Exhibit 10.58.7).. . . . . . . . . . . . . . . . . . .   (5)
 10.30     Development Properties in Cheyenne, Wyoming and Auburn,
           California. The following agreements are representative of
           those executed in connection with these properties.
           10.30.1  Management Agreement dated May 30, 1997, between
                    Willard Holdings, Inc., ("Owner") and the
                    registrant ("Manager") (Exhibit 10.5.1). . . . . . . . . . . . . . . . . . . .   (9)
           10.30.2  Lease Agreement dated May 30, 1997, between
                    Willard Holdings, Inc., ("Lessor") and the
                    registrant ("Lessee") (Exhibit 10.5.2).. . . . . . . . . . . . . . . . . . . .   (9)
 10.31     Senior Management Employment Agreements and Amendments
           entered into between the registrant and each of the
           following individuals:
           10.31.1  Frank A. Ruffo (Exhibit 10.6.2), Kelly J. Price
                    (Exhibit 10.6.3), Gary D. Witte (Exhibit 10.6.4),
                    Sarah J. Curtis (Exhibit 10.6.4), and Raymond R.
                    Brandstrom (Exhibit 10.6.5). . . . . . . . . . . . . . . . . . . . . . . . . .   (9)
           10.31.2  Raymond R. Brandstrom (Exhibit 10.11.1), Gary D.
                    Witte ( Exhibit 10.11.2), Frank A. Ruffo (Exhibit
                    10.11.3), Sarah J. Curtis (Exhibit 10.11.4), and
                    Kelly J. Price (Exhibit 10.11.5) . . . . . . . . . . . . . . . . . . . . . . .   (9)
 10.32     La Casa Grande in New Port Richey, Florida, River Oaks in
           Englewood, Florida, and Stanford Centre in Altamonte
           Springs, Florida. The following agreements are
           representative of those executed in connection with these
           properties.
           10.32.1  Stock Purchase Agreement dated September 30,
                    1996, between Wayne Voegele, Jerome Lang, Ronald
                    Carlson, Thomas Stanford, Frank McMillan, Lonnie
                    Carlson, and Carla Holweger ("Seller") and the
                    registrant ("Purchaser") with respect to La Casa

                                       28
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    Grande (Exhibit 10.1). . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (7)
           10.32.2  First Amendment to Stock Purchase Agreement dated
                    January 31, 1997, between the Seller and the
                    registrant with respect to La Case Grande
                    (Exhibit 10.2).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (7)
           10.32.3  Stock Purchase Agreement dated September 30,
                    1996, between the Seller and the registrant with
                    respect to River Oaks (Exhibit 10.3).. . . . . . . . . . . . . . . . . . . . .   (7)
           10.32.4  First Amendment to Stock Purchase Agreement dated
                    January 31, 1997, between the Seller and the
                    registrant with respect to River Oaks (Exhibit
                    10.4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (7)
           10.32.5  Stock Purchase Agreement dated September 30,
                    1996, between the Seller and the registrant with
                    respect to Stanford Centre (Exhibit 10.5). . . . . . . . . . . . . . . . . . .   (7)
           10.32.6  First Amendment to Stock Purchase Agreement dated
                    January 31, 1997, between the Seller and the
                    registrant with respect to Stanford Centre
                    (Exhibit 10.6).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (7)
 10.33     Painted Post Partnership
           10.33.1  Painted Post Partners Partnership Agreement dated
                    October 1, 1995 (Exhibit 10.24.7). . . . . . . . . . . . . . . . . . . . . . .   (1)
           10.33.2  First Amendment to Painted Post Partners
                    Partnership Agreement dated October 22, 1996,
                    between Daniel R. Baty and Raymond R. Brandstrom
                    (Exhibit 10.20.20).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (5)
           10.33.3  Indemnity Agreement dated November 3, 1996,
                    between the registrant and Painted Post Partners
                    (Exhibit 10.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (10)
           10.33.4  First Amendment to Indemnity Agreement dated
                    January 1, 1997, between the registrant and
                    Painted Post Partners (Exhibit 10.4).. . . . . . . . . . . . . . . . . . . . .  (10)
           10.33.5  Undertaking and Indemnity Agreement dated October
                    23, 1995, between the registrant, P. Jules Patt
                    and Pamela J. Patt and Painted Post Partnership
                    (Exhibit 10.5).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (10)
           10.33.6  First Amendment to Undertaking and Indemnity
                    Agreement dated January 1, 1997, between Painted
                    post Partners and the registrant (Exhibit 10.6). . . . . . . . . . . . . . . .  (10)
           10.33.7  First Amendment to Non-Competition Agreement
                    between the registrant and Daniel R. Baty
                    (Exhibit 10.1.1) and Raymond R. Brandstrom
                    (Exhibit 10.1.2).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (11)
 10.34     Ridgeland Court in Ridgeland, Mississippi
           10.34.1  Master Agreement and Subordination Agreement
                    dated September 5, 1997, between the
                    registrant, Emeritus Properties I, Inc., and
                    Mississippi Baptist Health Systems, Inc.
                    (Exhibit 10.1.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (12)
           10.34.2  License Agreement dated September 5, 1997,

                                       29
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    between the registrant and its subsidiary and
                    affiliated corporations and Mississippi Baptist
                    Health Systems, Inc. (Exhibit 10.1.2). . . . . . . . . . . . . . . . . . . . .  (12)
           10.34.3  Economic Interest Assignment Agreement and
                    Subordination Agreement dated September 5,
                    1997, between the registrant, Emeritus
                    Properties I, Inc., and Mississippi Baptist
                    Health Systems, Inc. (Exhibit 10.1.3). . . . . . . . . . . . . . . . . . . . .  (12)
           10.34.4  Operating Agreement for Ridgeland Assisted
                    Living, L.L.C. dated December 23, 1998, between
                    the registrant, Emeritust Properties XI, L.L.C.
                    and Mississippi Baptist Medical Enterprises,
                    Inc. (Exhibit 10.46.4) . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (16)
           10.34.5  Purchase and Sale Agreement dated December 23,
                    1998, between the registrant and Meditrust
                    Company LLC. (Exhibit 10.46.5).. . . . . . . . . . . . . . . . . . . . . . . .  (16)
 10.35     Development Property in Urbana, Illinois.
           10.35.1  Lease Agreement dated September 10, 1997,
                    between ALCO IV, L.L.C. ("Lessor") and the
                    registrant ("Lessee") (Exhibit 10.2.1).. . . . . . . . . . . . . . . . . . . .  (12)
           10.35.2  Management Agreement dated September 10, 1997,
                    between the registrant ("Manager") and ALCO IV,
                    L.L.C. ("Owner") (Exhibit 10.2.2). . . . . . . . . . . . . . . . . . . . . . .  (12)
           10.35.3  Purchase agreement for Urbana between HRT of Illinois ("Seller")
                    and the registrant ("Purchaser") dated March 27, 2002. . . . . . . . . . . . .  (25)
 10.36     Amendment to Office Lease Agreement dated September 6,
           1996, between Martin Selig ("Lessor") and the registrant. . . . . . . . . . . . . . . .  (13)
 10.37     Villa Del Rey in Escondido, California
           10.37.1  Purchase and Sale Agreement dated December 19,
                    1996, between the registrant ("Purchaser") and
                    Northwest Retirement ("Seller") (Exhibit
                    10.1.1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
 10.38     Development Property in Paso Robles, California
           10.38.1  Agreement of TDC/Emeritus Paso Robles
                    Associates dated June 1, 1995, between the
                    registrant and TDC Convalescent, Inc. (Exhibit
                    10.2.1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.38.2  Loan Agreement in the amount of $6,000,000
                    dated February 15, 1997, between Finova Capital
                    Corporation ("Lender") and TDC/Emeritus Paso
                    Robles Associates ("Borrower") (Exhibit
                    10.2.2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.38.3  Promissory Note dated February 28, 1997, in the
                    amount of $6,000,000 between Finova Capital
                    Corporation ("Lender") and TDC/Emeritus Paso
                    Robles Associates ("Borrower") (Exhibit
                    10.2.3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.38.4  Deed of Trust, Security Agreement, Assignment
                    of Leases and Rents and Fixture Filing dated
                    February 18, 1997, between TDC/Emeritus Paso

                                       30
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    Robles Associates ("Trustor"), Chicago Title
                    Company ("Trustee") and Finova Capital
                    Corporation ("Beneficiary") (Exhibit 10.2.4).. . . . . . . . . . . . . . . . .   (6)
           10.38.5  Guaranty between TDC Convalescent, Inc.
                    ("Guarantor") and Finova Capital Corporation
                    (Exhibit 10.2.5).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.38.6  Guaranty between the registrant ("Guarantor")
                    and Finova Capital Corporation (Exhibit
                    10.2.6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (6)
           10.38.7  Purchase and Sale Agreement between TDC Convalescent, Inc.
                    ("Seller") and the registrant ("Purchaser") dated March 26, 2002.. . . . . . .  (25)
 10.39     Development Property in Staunton, Virginia
           10.39.1  Purchase and Sale Agreement dated February 5,
                    1997, between Greencastle Retirement Partners,
                    L.L.C. ("Purchaser") and Gail G. Brown
                    ("Seller") (Exhibit 10.72.1).. . . . . . . . . . . . . . . . . . . . . . . . .  (13)
           10.39.2  Assignment and Assumption of Purchase and Sale
                    Agreement dated February 12, 1997, between
                    Greencastle Retirement Partners, L.L.C. and the
                    registrant.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (13)
 10.40     Development Property in Jamestown New York
           10.40.1  Purchase Agreement dated December 12, 1996,
                    between June Fagerstrom ("Seller") and Wegman
                    Family LLC ("Buyer") (Exhibit 10.73.1).. . . . . . . . . . . . . . . . . . . .  (13)
           10.40.2  Assignment and Assumption Agreement dated
                    December 30, 1997, between Wegman Family LLC
                    ("Assignor") and Painted Post Partners
                    ("Assignee") (Exhibit 10.73.2).. . . . . . . . . . . . . . . . . . . . . . . .  (13)
 10.41     Development Property in Danville, Illinois
           10.41.1  Purchase and Sale Agreement dated October 14,
                    1997, between South Bay Partners, Inc.
                    ("Purchaser") and Elks Lodge No. 332, BPOE
                    ("Seller") (Exhibit 10.74.1).. . . . . . . . . . . . . . . . . . . . . . . . .  (13)
           10.41.2  Assignment and Assumption of Purchase and Sale
                    Agreement dated October 21, 1997, between South
                    Bay Partners, Inc. and the registrant (Exhibit
                    10.74.2).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (13)
 10.42     Development Property in Biloxi, Mississippi
           10.42.1  Management Agreement dated December 18, 1997,
                    between the registrant ("Manager") and ALCO
                    VII, L.L.C. ("Owner") (Exhibit 10.75.1). . . . . . . . . . . . . . . . . . . .  (13)
           10.42.2  Lease Agreement dated September 29, 2000,
                    between the registrant ("Lessee") and HR
                    Acquisition Corporation ("Lessor") (Exhibit
                    10.75.2).
 10.43     Sanyo Electric Co., Ltd.
           10.43.1  Agreement entered into on May 30, 1996, between
                    the registrant and Sanyo Electric Co., Ltd. for
                    the interest in jointly entering the
                    development, construction and /or operation of

                                       31
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    the Senior Housing Business in Japan (Exhibit
                    10.76.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (13)
           10.43.2  Joint Venture Agreement entered into on July 9,
                    1997, between the registrant and Sanyo Electric
                    Co., Ltd. (Exhibit 10.76.2). . . . . . . . . . . . . . . . . . . . . . . . . .  (13)
 10.44     Lakeridge Place in Wichita Falls, Texas, Meadowlands
           Terrace in Waco, Texas, Saddleridge Lodge in Midland,
           Texas and Sherwood Place in Odessa, Texas. The following
           agreements are representative of those executed in
           connection with these properties.
           10.44.1  Management and Consulting Agreement dated
                    February 1, 1998, between ESC I, L.P., and XL
                    Management Company L.L.C. (Exhibit 10.78.1). . . . . . . . . . . . . . . . . .  (13)
 10.45     1998 Employee Stock Purchase Plan (Exhibit 99.2). . . . . . . . . . . . . . . . . . . .  (14)
 10.46     River Oaks in Englewood, California, Stanford Center in
           Alamonte Springs, La Casa Grande in New Port Richey,
           Florida, Silver Pines in Cedar Rapids, Iowa, Villa Del
           Rey in Escondido, California, Spring Meadows in Bozeman,
           Montana, Juniper Meadows in Lewiston, Idaho and Fulton
           Villa in Stockton, California.
           10.46.1  Credit Agreement dated April 29, 1998, between
                    Emeritus Properties II, Inc., Emeritus
                    Properties V, Inc., and Emeritus Properties
                    VII, Inc. ("Borrowers") and Deutsche Bank AG,
                    New York Branch ("Lender") (Exhibit 10.2.1). . . . . . . . . . . . . . . . . .  (15)
           10.46.2  Amended and Restated Guaranty and Limited
                    Indemnity Agreement dated June 30, 1998,
                    between Emeritus Corporation ("Guarantor") and
                    Deutsche Bank AG ("Lender") (Exhibit 10.2.2).. . . . . . . . . . . . . . . . .  (15)
           10.46.3  Amendment to Credit Agreement and Restatement
                    of Article IX dated June 30, 1998, between
                    Emeritus Properties II, Inc., Emeritus
                    Properties III, Inc., Emeritus Properties V and
                    Emeritus Properties VII, Inc. (together
                    "Borrowers") and Deutsche Bank AG ("Lender")
                    (Exhibit 10.2.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (15)
           10.46.4  Guaranty and Limited Indemnity Agreement dated
                    April 29, 1998, between Emeritus Corporation
                    ("Grantor") and Deutsche Bank AG, New York
                    Branch ("Lender") (Exhibit 10.2.4).. . . . . . . . . . . . . . . . . . . . . .  (15)
           10.46.5  Promissory Note dated June 30, 1998, between
                    Emeritus Properties III, Inc. ("Borrower") and
                    Deutsche Bank AG, New York Branch ("Lender")
                    (Exhibit 10.2.5).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (15)
           10.46.6  Future Advance Promissory Note dated April 29,
                    1998, between Emeritus Properties V, Inc.
                    ("Borrower") and Deutsche Bank AG, New York
                    Branch ("Lender") (Exhibit 10.2.6).. . . . . . . . . . . . . . . . . . . . . .  (15)
           10.46.7  Extension Agreement dated May 31, 2001, between
                    Emeritus Properties II, Inc., Emeritus Properties V, Inc.,

                                       32
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    Emeritus Properties VII, Inc. ("Original Borrrowers"),
                    Emeritus Properties III, Inc. ("Additional Borrower"),
                   and Deutsche Bank AG, New York Branch ("Lender") (Exhibit 10.1).. . . . . . . .  (22)
           10.46.8  Loan Agreement dated February 8, 2002, between Heller
                   Healthcare Finance, Inc. ("Lender") and ESC - Puyallup, LLC,
                   ESC - Port St. Richie, LLC, and ESC - Bozeman, LLC ("Borrower").. . . . . . . .  (24)
 10.47     Courtyard at the Willows In Puyallup, Washington
           10.47.1  Deed of Trust, Trust Indenture, Assignment,
                    Assignment of Rents, Security Agreement,
                    Including Fixture Filing and Financing
                    Statement dated June 30, 1998, between Emeritus
                    Properties III, Inc. ("Grantor") and Chicago
                    Title Insurance Company ("Trustee") and
                    Deutsche Bank AG, New York Branch
                    ("Beneficiary") (Exhibit 10.7.1).. . . . . . . . . . . . . . . . . . . . . . .  (15)
           10.47.2  Mortgage, Open-End Mortgage, Advance Money
                    Mortgage, Trust Deed, Deed Of Trust, Trust
                    Indenture, Assignment, Assignment of Rents,
                    Security Agreement, Including Fixture Filing
                    and Financing Statement dated June 30, 1998,
                    between Emeritus Properties III, Inc.
                    ("Grantor, Mortgagor") and Deutsche Bank, AG,
                    New York Branch (Exhibit 10.7.2).. . . . . . . . . . . . . . . . . . . . . . .  (15)
 10.48     Silver Pines in Cedar Rapids, Iowa, Spring Meadows in
           Bozeman, Montana and Juniper Meadows in Lewiston, Idaho.
           10.48.1  Promissory Note dated April 29, 1998, between
                    Emeritus Properties II ("Borrower") and
                    Deutsche Bank AG, New York Branch (Exhibit
                    10.8.1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (15)
 10.49     Richland Gardens in Richland, Washington, Charlton Place
           in Tacoma Washington, The Pines of Goldsboro in
           Goldsboro, North Carolina, Silverleaf Manor in Meridian,
           Mississippi and Wilburn Gardens in Fredericksburg,
           Virginia. The following agreement is representative of
           those executed in connection with these properties.
           10.49.1  Agreement To Provide Management Services To An
                    Assisted Living Facility dated February 2,
                    1998, between Richland Assisted, L.L.C.
                    ("Owner") and Acorn Service Corporation
                    ("Manager") (Exhibit 10.9.1).. . . . . . . . . . . . . . . . . . . . . . . . .  (15)
 10.50     Richland Gardens in Richland, Washington, The Pines of
           Goldsboro in Goldsboro, North Carolina, Silverleaf Manor
           in Meridian, Mississippi, Wilburn Gardens in
           Fredericksburg, Virginia and Park Lane in Toledo, Ohio.
           The following agreement is representative of those
           executed in connection with these properties.
           10.50.1  Marketing Agreement dated February 2, 1998,
                    between Acorn Service Corporation ("Acorn") and
                    Richland Assisted, L.L.C. ("RALLC") (Exhibit
                    10.10.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (15)

                                       33
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

 10.51     Kirkland Lodge in Kirkland, Washington
           10.51.1  Purchase and Sale Agreement dated December 23,
                    1998, between the registrant and Meditrust
                    Company LLC. (Exhibit 10.46.5).. . . . . . . . . . . . . . . . . . . . . . . .  (16)
           10.51.2  Loan Agreement dated December 28, 1998, between
                    Emeritus Properties X, L.L.C and Guaranty
                    Federal Bank (Exhibit 10.65.2).. . . . . . . . . . . . . . . . . . . . . . . .  (16)
           10.51.3  Promissory Note Agreement dated December 28,
                    1998, between Emeritus Properties X, L.L.C and
                    Guaranty Federal Bank (Exhibit 10.65.3). . . . . . . . . . . . . . . . . . . .  (16)
           10.51.4  Guaranty Agreement dated December 28, 1998,
                    between the registrant and Guaranty Federal
                    Bank (Exhibit 10.65.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . .  (16)
 10.52     Emeritrust Communities
           10.52.1  Purchase and Sale Agreement dated December 30,
                    1998, between the registrant, Emeritus
                    Properties VI, Inc., ESC I, L.P. and AL
                    Investors LLC. (Exhibit 10.66.1).. . . . . . . . . . . . . . . . . . . . . . .  (16)
           10.52.2  Supplemental Purchase Agreement in Connection
                    with Purchase of Facilities dated December 30,
                    1998, between the registrant, Emeritus
                    Properties I, Inc. Emeritus Properties VI,
                    Inc., ESC I, L.P. and AL Investors LLC.
                    (Exhibit 10.66.2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (16)
           10.52.3  Management Agreement with Option to Purchase
                    dated December 30, 1998, between the
                    registrant, Emeritus Management I LP, Emeritus
                    Properties I, Inc, ESC I, L.P., Emeritus
                    Management LLC and AL Investors LLC. (Exhibit
                    10.66.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (16)
           10.52.4  Guaranty of Management Agreement and Shortfall
                    Funding Agreement dated December 30, 1998,
                    between the registrant and AL Investors LLC.
                    (Exhibit 10.66.4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (16)
           10.52.5  Put and Purchase Agreement dated December 30,
                    1998, between Daniel R. Baty and AL Investors
                    LLC. (Exhibit 10.66.5) Second Emeritrust.. . . . . . . . . . . . . . . . . . .  (16)
          10.52.6  First Amendment to Management Agreement with Option
                   to Purchase (AL I - Emeritrust 25 Facilities) dated March 22, 2001,
                   between the registrant, Emeritus Management I LP, and AL
                   Investors LLC.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
          10.52.7  Amendment to Guaranty of Management Agreement and
                  Shortfall Funding Agreement (Emeritrust 25) dated March 22, 2001,
                  between the registrant and AL Investors LLC. . . . . . . . . . . . . . . . . . .  (24)
          10.52.8  Second Amendment to Put and Purchase Agreement (AL I -
                 Emeritrust 25 Facilities) dated March 22, 2001, between Daniel R.
                 Baty and AL Investors LLC.. . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
          10.52.9  Second Amendment to Management Agreement with Option to
                Purchase (AL I - Emeritrust 25 Facilities) dated January 1, 2002,
                between the registrant, Emeritus Management I LP, and AL

                                       34
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                Investors LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
          10.52.10  Third Amendment to Put and Purchase Agreement (AL I -
               Emeritrust 25 Facilities) dated January 1, 2002, between Daniel R. Baty
               and AL Investors LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
          10.52.11  Waiver, Consent, and Amendment to Management Agreement dated
               May 1, 2002, (AL I-Laurel Place) between Emeritus Management, L.L.C.,
               the registrant, and AL I Investors, L.L.C.. . . . . . . . . . . . . . . . . . . . .  (25)
 10.53     Emeritrust II Communities
           10.53.1  Supplemental Purchase Agreement in Connection
                    with Purchase of Facilities (AL II--14
                    Operating Facilities) dated March 26,1999,
                    between the registrant, Emeritus Properties I,
                    Inc. ESC G.G. I, Inc., ESC I, L.P. and AL
                    Investors II LLC (Exhibit 10.1.1). . . . . . . . . . . . . . . . . . . . . . .  (17)
           10.53.2  Management Agreement with Option to Purchase
                    (AL II--14 Operating Facilities) dated March
                    26, 1999, between the registrant, Emeritus
                    Management I LP, Emeritus Properties I, Inc.,
                    ESC G.P. I, Inc., ESC I, L.P., Emeritus
                    Management LLC and AL Investors II LLC (Exhibit
                    10.1.2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (17)
           10.53.3  Guaranty of Management Agreement (AL II--14
                    Operating Facilities) dated March 26, 1999,
                    between the registrant and AL Investors II LLC
                    (Exhibit 10.1.3).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (17)
           10.53.4  Supplemental Purchase Agreement in Connection
                    with Purchase of Facilities (AL II--5
                    Development Facilities) dated March 26, 1999,
                    between the registrant, Emeritus Properties I,
                    Inc. and AL Investors Development LLC (Exhibit
                    10.1.4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (17)
           10.53.5  Management Agreement with Option to Purchase
                    (AL II--5 Development Facilities) dated
                    March 26, 1999, between the registrant,
                    Emeritus Properties I, Inc., Emeritus
                    Management LLC and AL Investors Development LLC
                    (Exhibit 10.1.5).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (17)
           10.53.6  Guaranty of Management Agreement and Shortfall
                    Funding Agreement (AL II--5 Development
                    Facilities) dated March 26, 1999, between the
                    registrant and AL Investors Development LLC
                    (Exhibit 10.1.6).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (17)
           10.53.7  Put and Purchase Agreement (AL II Holdings--14
                    Operating Facilities and 5 Development
                    Facilities) dated March 26, 1999, between
                    Daniel R. Baty and AL II Holdings LLC, AL
                    Investors II LLC and AL Investors Development
                    LLC (Exhibit 10.1.7).. . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (17)
           10.53.8  Second Amendment to Management Agreement (AL II -
                    14 Operating Facilities) (GMAC) dated March 22, 2001, between the

                                       35
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                    registrant, Emeritus Management LLC, Emeritus Management I,
                    and AL Investors II LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
           10.53.9  Second Amendment to Put and Purchase Agreement (AL
                    II Holdings - 14 Operating Facilities and 5 Development Facilities)
                    dated March 22, 2001, between Daniel R. Baty and AL II Holdings
                    LLC, AL Investors II LLC and AL Investors Development LLC. . . . . . . . . . .  (24)
           10.53.10  First Amendment to Management Agreement (AL II -
                    5 Development Facilities) dated January 1, 2002, between the
                    registrant, Emeritus Management LLC, and AL Investors
                    Development LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
           10.53.11  Third Amendment to Put and Purchase Agreement (AL II
                   Holdings - 14 Operating Facilities and 5 Development Facilities)
                   dated January 1, 2002, between Daniel R. Baty and AL II Holdings
                   LLC, AL Investors II LLC, and AL Investors Development LLC. . . . . . . . . . .  (24)
           10.53.12  Third Amendment to Management Agreement (AL II -
                   14 Operating Facilities) (GMAC) dated January 1, 2002, between
                   the registrant, Emeritus Management LLC, Emeritus Management I LP,
                   and AL Investors II LLC.. . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
 10.54     Meadow Lodge at Drum Lodge Hill in Chelmsford,
           Massachusetts
           10.54.1  Purchase and Sales Agreement dated April 23,
                    1999, between LM Chelmsford Assisted Living,
                    LLC ("Seller") and the registrant ("purchaser")
                    (Exhibit 10.1.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (18)
 10.55     Meadow Lodge at Drum Hill in Chelmsford, Massachusetts,
           Cobblestones at Fairmont in Manassas, Virginia, Kirkland
           Lodge in Kirkland, Washington and Ridgeland Pointe in
           Ridgeland, Mississippi. The following agreements are
           representative of those executed in conjunction with these
           properties.
           10.55.1   Fixed Rate Noted dated September 29, 1999,
                     between Amresco Capital, L.P. ("Payee") and the
                     registrant ("Maker") (Exhibit 10.2.1).. . . . . . . . . . . . . . . . . . . .  (18)
           10.55.2   Mortgage and Security Agreement dated September
                     29, 1999, between Amresco Capital, L.P.
                     (Mortgagee") and the registrant ("mortgagor")
                     (Exhibit 10.2.2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (18)
 10.56     Series B Preferred Stock Purchase Agreement dated as of
           December 10, 1999, between Emeritus Corporation and Saratoga
           Partners IV, L.P. (Exhibit 4.1).. . . . . . . . . . . . . . . . . . . . . . . . . . . .  (19)
 10.57     Designation of Rights and Preferences of Series B
           Convertible Preferred Stock as filed with the Secretary of
           State of Washington on December 29, 1999 (Exhibit 4.2). . . . . . . . . . . . . . . . .  (19)
 10.58     Shareholders Agreement dated as of December 30, 1999, among
           Emeritus Corporation, Daniel R. Baty, B.F., Limited
           Partnership and Saratoga Partners IV, L.P. (Exhibit 4.3). . . . . . . . . . . . . . . .  (19)
 10.59     Registration Rights Agreement dated as of December 30, 1999,
           between Emeritus Corporation and Saratoga Partners IV, L.P.
           (Exhibit 4.4).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (19)
 10.60     Investment Agreement dated as of December 30, 1999, among

                                       36
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

           Emeritus Corporation, Daniel R. Baty, B.F., Limited
           Partnership and Saratoga Partners IV, L.P., Saratoga
           Partners IV, L.P. and Saratoga Management Company LLC.
           (Exhibit 4.5).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (19)
 10.61     Canterbury Ridge in Urbana, Illinois
           10.61.1   Lease agreement dated September 29, 2000, and
                     effective October 1, 2000, between HR
                     Acquisitions I Corporation ("Lessor") and
                     Emeritus Corporation ("Lessee").. . . . . . . . . . . . . . . . . . . . . . .  (20)
 10.62     Emerald Hills in Auburn
           10.62.1   Lease agreement dated September 29, 2000, and
                     effective October 1, 2000, between HR
                     Acquisitions I Corporation ("Lessor") and
                     Emeritus Corporation ("Lessee").. . . . . . . . . . . . . . . . . . . . . . .  (20)
           10.62.2  Lease agreement dated September 5, 2001, between Health
                    Care Property Investors, Inc. ("Lessor"), and Emeritus
                    Corporation ("Lessee").. . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
 10.63     Sierra Hills in Cheyenne, Wyoming
           10.63.1   Lease agreement dated September 29, 2000, and
                     effective October 1, 2000, between HR
                     Acquisitions I Corporation ("Lessor") and
                     Emeritus Corporation ("Lessee").. . . . . . . . . . . . . . . . . . . . . . .  (20)
          10.63.2  Lease Assignment and  Operations Transfer Agreement dated
                     September 30, 2001, between Emeritus Corporation ("Tenant")
                    and Sierra Hills Assisted Living Community, LLC, ("Assignee")
                    and Jon M. and Kristin P. Harder, husband and wife, Darryl E.
                    and Carol L. Fisher, husband and wife, Eric W. and Marti M.
                     Jacobson, husband and wife and Sunwest Management, Inc.
                     ("Guarantor").. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
 10.64     Villa Ocotillo in Scottsdale, Arizona
           10.64.1   Purchase and sale agreement originally dated
                     October 21, 1997, and effective January 2001,
                     between Melchor and Isabel Balazs, as Trustees
                     ("Purchaser") and Emeritus Corporation
                     ("Seller"). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (21)
           10.64.2   Lease agreement dated December 29, 2000 and
                     effective December 29, 2000, between Melchor
                     Balazs and Isabel Balazs ("Lessor") and Emeritus
                     Corporation ("Lessee"). . . . . . . . . . . . . . . . . . . . . . . . . . . .  (21)
           10.64.3  Transfer of Operations Agreement dated August 14, 2001,
                    between Emeritus Corporation and Melchor Balazs. . . . . . . . . . . . . . . .  (24)
 10.65     Loyalton of Hattiesburg in Hattiesburg, Mississippi
           10.65.1   Lease agreement dated June 10, 1998, and
                     effective October 1, 2000, between ALCO XII, LLC
                     ("Lessor") and Emeritus Corporation ("Lessee"). . . . . . . . . . . . . . . .  (21)
           10.65.2   Purchase agreement for Hattiesburg between ALCO XII L.L.C.
                     ("Seller") and the registrant ("Purchaser") dated March  27, 2002.. . . . . .  (25)
 10.66     Loyalton of Biloxi in Biloxi, Mississippi
           10.66.1   Lease agreement dated September 29, 2000, and
                     effective October 1, 2000, between HR

                                       37
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                     Acquisitions I Corporation ("Lessor") and
                     Emeritus Corporation ("Lessee").. . . . . . . . . . . . . . . . . . . . . . .  (21)
           10.66.2  Lease agreement dated September 5, 2001, between Health
                     Care Property Investors, Inc. ("Lessor"), and Emeritus
                     Corporation ("Lessee"). . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
10.67     Amended 1998 Employee Stock Purchase Plan (as amended and
              restated on May 19, 1999, and August 17, 2001).  (Appendix B). . . . . . . . . . . .  (23)
10.68     Kingsley Place at Alexandria, Louisiana, Kingsley Place at Lake Charles,
              Louisiana, Kingsley Place at Lafayette, Louisiana, Kingsley Place
              of Shreveport, Louisiana, Kingsley Place of Henderson, Texas,
              Kingsley Placeat Oakwell Farms, Texas, Kingsley Place at the Medical
              Center, Texas, Kingsley Place at Stonebridge, Texas. The following
              agreements are representative of those executed in connection
              with these properties:
           10.68.1  Horizon Bay Lease Facilities Purchase Agreement between Integrated
                     Living Communities of Alexandria, L.L.C, Integrated Living Communities
                     of Lake Charles, L.L.C., Integrated Living Communities of Lafayette, L.L.C.,
                     Integrated Living Communities of Henderson, L.P., Integrated Living
                     Communities of Oakwell, L.P., Integrated Living Communities of
                     San Antonio, L.P., and Integrated Living Communities of McKinney, L.P.,
                     (collectively, the  "Seller") and the registrant ("Purchaser") dated
                     April 4, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.2  Horizon Bay Purchase Agreement between the registrant ("Purchaser")
                     and Senior Lifestyle Shreveport, L.L.C. ("Seller"), dated April 17, 2002. . .  (25)
           10.68.3  First Amendment to the Horizon Bay Lease Facilities Purchase
                     Agreement between the registrant ("Purchaser") and Integrated Living
                     Communities of Alexandria, L.L.C,  Integrated Living Communities
                     of Lake Charles, L.L.C., Integrated Living Communities of Lafayette, L.L.C.,
                     Integrated Living Communities of Henderson, L.P., Integrated Living
                     Communities of Oakwell, L.P., Integrated Living Communities of
                     San Antonio, L.P., and Integrated Living Communities of McKinney, L.P.,
                     (collectively, the  "Seller") dated May 1, 2002.. . . . . . . . . . . . . . .  (25)
           10.68.4  First Amendment to the Horizon Bay Purchase Agreement
                     between the registrant ("Purchaser") and Senior Lifestyle
                     Shreveport, L.L.C. ("Seller"), dated May 1, 2002. . . . . . . . . . . . . . .  (25)
           10.68.5  Amended and restated funding agreement between the registrant
                     and HB-ESC I, L.L.C., HB-ESC II, L.L.C., and HB-ESC V, L.P.,
                     dated May 1, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.6  Agreement to provide management services to assisted living
                     facilities (Lafayette) between HB-ESC II, L.P., and the registrant
                     dated May 1, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.7  Agreement to provide management services to assisted living
                     facilities (Lake Charles) between HB-ESC II, L.P., and the registrant
                     dated May 1, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.8  Agreement to provide management services to assisted living
                     facilities (Alexandria) between HB-ESC II, L.P., and the registrant
                     dated May 1, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.9  Agreement to provide management services to assisted living
                     facilities (Shreveport) between HB-ESC I, L.P., and the registrant
                     dated May 1, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)

                                       38
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

           10.68.10  Agreement to provide management services to assisted living
                     facilities (Henderson) between HB-ESC V, L.P., and the registrant
                     dated May 9, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.11  Agreement to provide management services to assisted living
                     facilities (Medical Center) between HB-ESC V, L.P., and the registrant
                     dated May 9, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.12  Agreement to provide management services to assisted living
                     facilities (Oakwell Farms) between HB-ESC V, L.P., and the registrant
                     dated May 9, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.13  Agreement to provide management services to assisted living
                     facilities (Stonebridge) between HB-ESC V, L.P., and the registrant
                     dated May 9, 2002.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.68.14  Second Amendment to the Horizon Bay Purchase Agreement
                     between the registrant ("Purchaser") and Senior Lifestyle
                     Shreveport, L.L.C. ("Seller"), dated May 31, 2002.. . . . . . . . . . . . . .  (25)
           10.68.15  Third Amendment to the Horizon Bay Purchase Agreement
                     between the registrant ("Purchaser") and Senior Lifestyle
                     Shreveport, L.L.C. ("Seller"), dated June 14, 2002. . . . . . . . . . . . . .  (25)
           10.68.16  Fourth Amendment to the Horizon Bay Purchase Agreement
                     between the registrant ("Purchaser") and Senior Lifestyle
                     Shreveport, L.L.C. ("Seller"), dated June 28, 2002. . . . . . . . . . . . . .  (25)
10.69     Willow Park and West Wind in Boise, Idaho,  Sunshine Villa in Santa Cruz,
              California, Orchard Park in Clovis, California, Willow Creek in Folsom,
              California, Regent Court in Modesto, California, Villa Sera in Salinas,
              California, Regent House in Merced, California, Regent Senior Living in
              West Covina, California, Sheldon Park in Eugene, Oregon, Regency Park in
              Portland, Oregon, Regent Court in Corvalis, Oregon, Hamilton House in
              San Antonio, Texas, Regent Court at Scottsdale and Desert Flower
              in Scottsdale, Arizona, Sterling Park in Redmond, Washington, Regent Court
              in Kent, Washington, and Northshore House in Kenmore, Washington
              The following agreements are representative of those executed in connection
              with these properties:
           10.69.1  Amended and Restated Agreement to provide management services
                     to Assisted Living Facilities between  Regent Assisted Living, Inc.
                      ("Owner"), and the registrant ("Manager") dated December 31, 2001. . . . . .  (25)
           10.69.2  Amended and Restated Agreement to provide accounting and
                     consulting services to California Assisted Living Facilities between
                      Regent Assisted Living, Inc. ("Owner"), and the registrant ("Manager")
                      dated December 31, 2001. . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.69.3  Agreement to provide management services to Washington
                     Assisted Living Facilities between  Regent Assisted Living, Inc.
                      ("Owner"), and the registrant ("Manager") dated December 31, 2001. . . . . .  (25)
           10.69.4  Agreement to provide accounting and consulting services to
                     California Assisted Living Facilities (Willow Creek-Folsom) between
                      Regent Assisted Living, Inc. ("Owner"), and the registrant ("Manager")
                      dated February 15, 2001. . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.69.5  Lease and Working Capital Agreement between Sacramento County
                      Assisted, L.L.C.("Landlord") and Regent Assisted Living, Inc.("Tenant")
                      dated February 15, 2002. . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           10.69.6  Assignment and Release Agreeement between Regent Assisted Living,

                                       39
<PAGE>
                                                                                              Footnote
  Number                 Description                                                           Number
 --------  -------------------------------------------------------------------------------  -----------

                      Inc.("Assignor"), the registrant ("Assignee"), and Sacramento County
                      Assisted, L.L.C. ("Landlord") dated July 2, 2002.. . . . . . . . . . . . . .  (25)
           10.69.7  First Amendment to  Lease and Working Capital Agreement between
                      Sacramento County Assisted, L.L.C. ("Landlord")  and the registrant
                      ("Tenant") dated July 2, 2002. . . . . . . . . . . . . . . . . . . . . . . .  (25)
10.70     Loyalton Court at Scottsdale, Arizona.  The following agreements are
              representative of those executed in connection with the property:
           10.70.1  Agreement to provide management services to Assisted Living
                      Facilities (Scottsdale) between Scottsdale Assisted, L.L.C, ("Owner")
                      and the registrant ("Manager") dated February 8, 2002. . . . . . . . . . . .  (25)
           10.70.2  First Amendment to Management Agreement (Scottsdale) between
                      Scottsdale Assisted, L.L.C, ("Owner") and the registrant ("Manager")
                      dated February 15, 2002. . . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
 21.1      Subsidiaries of the registrant. . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
 23.1      Consent of KPMG LLP.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  (24)
 99.1      Certification of Periodic Reports
           99.1.1  Certification Daniel R. Baty. . . . . . . . . . . . . . . . . . . . . . . . . .  (25)
           99.1.2  Certification Raymond R. Brandstrom . . . . . . . . . . . . . . . . . . . . . .  (25)
</TABLE>





      (1) Incorporated by reference to the indicated exhibit filed with the
          Company's Registration Statement on Form S-1 (File No. 33-97508)
          declared effective on November 21, 1995.
      (2) Incorporated by reference to the indicated exhibit filed with the
          Company's Annual Report on Form 10-K (File No. 1-14012) on March 29,
          1996.
      (3) Incorporated by reference to the indicated exhibit filed with the
          Company's Second Quarter Report on Form 10-Q (File No. 1-14012) on
          August 14, 1996.
      (4) Incorporated by reference to the indicated exhibit filed with the
          Company's Third Quarter Report on Form 10-Q (File No. 1-14012) on
          November 14, 1996.
      (5) Incorporated by reference to the indicated exhibit filed with the
          Company's Annual Report on Form 10-K (File No. 1-14012) on March 31,
          1997.
      (6) Incorporated by reference to the indicated exhibit filed with the
          Company's First Quarter Report on Form 10-Q (File No. 1-14012) on May
          15, 1997.
      (7) Incorporated by reference to the indicated exhibit filed with the
          Company's Current Report on Form 8-K (File No. 1-14012) on May 16,
          1997.
      (8) Incorporated by reference to the indicated exhibit filed with the
          Company's Current Report on Form 8-K Amendment No. 1 (File No.
          1-14012) on July 14, 1997.
      (9) Incorporated by reference to the indicated exhibit filed with the
          Company's Second Quarter Report on Form 10-Q (File No. 1-14012) on
          August 14, 1997.
     (10) Incorporated by reference to the indicated exhibit filed with the
          Company's Registration Statement on Form S-3 Amendment No. 2 (File No.
          333-20805) on August 14, 1997.
     (11) Incorporated by reference to the indicated exhibit filed with the
          Company's Registration Statement on Form S-3 Amendment No. 3 (File No.
          333-20805) on October 29, 1997.
     (12) Incorporated by reference to the indicated exhibit filed with the
          Company's Third Quarter Report on Form 10-Q (File No. 1-14012) on
          November 14, 1997.
     (13) Incorporated by reference to the indicated exhibit filed with the
          Company's Annual Report on Form 10-K (File No. 1-14012) on March 30,
          1998.
     (14) Incorporated by reference to the indicated exhibit filed with the
          Company's Registration Statement on Form S-8 (File No. 333-60323) on
          July 31, 1998.
     (15) Incorporated by reference to the indicated exhibit filed with the
          Company's Second Quarter Report on Form 10-Q (File No. 1-14012) on
          August 14, 1998
     (16) Incorporated by reference to the indicated exhibit filed with the
          Company's Annual Report on Form 10-K (File No. 1-14012) on March 31,
          1999.
     (17) Incorporated by reference to the indicated exhibit filed with the
          Company's First Quarter Report on Form 10-Q (File No. 1-14012) on May
          10, 1999.
     (18) Incorporated by reference to the indicated exhibit filed with the
          Company's Third Quarter Report on Form 10-Q (File No. 1-14012) on
          November 15, 1999.
     (19) Incorporated by reference to the indicated exhibit filed with the
          Company's Form 8-K (File No. 1-14012) on January 14, 2000.
     (20) Incorporated by reference to the indicated exhibit filed with the
          Company's Third Quarter Report on Form 10-Q (File No. 1-14012) on
          November 14, 2000.
     (21) Incorporated by reference to the indicated exhibit filed with the
          Company's Annual Report on Form 10-K (File No. 1-14012) on April 2,
          2001.
     (22) Incorporated by reference to the indicated exhibit filed with the
          Company's Current Report on Form 8-K (File No. 1-14012) on July 18,
          2001.
     (23) Incorporated by reference to the indicated exhibit filed with the
          Company's Definitive Proxy Statement on Form DEF 14A on August 17,
          2001.
     (24) Incorporated by reference to the indicated exhibit filed with the
          Company's Annual Report on Form 10-K (File No. 1-14012) on March 29,
          2002.
     (25) Filed herewith.

                                       40
<PAGE>

(c)  The  Company filed no reports on Form 8-K during the quarter ended June 30,
     2002.

                                       41
<PAGE>


                                    SIGNATURE

Pursuant  to  the  requirements  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.

Dated:  August  14,  2002

                                              EMERITUS  CORPORATION
                                                 (Registrant)


                                       /s/  Raymond  R.  Brandstrom
                                       -----------------------------------------
                                       Raymond  R.  Brandstrom, Vice President
                                       of Finance, Chief Financial Officer, and
                                       Secretary

                                       42
<PAGE>