LOAN NO. 07-0004017

                                    GUARANTY


     THIS  GUARANTY dated as of the 21st day of August, 2002 (the "GUARANTY") is
made  by  the EMERITUS CORPORATION, a Washington corporation, with an address at
3131 Elliott Avenue, Suite 500, Seattle, Washington 98121 (referred to herein as
the "GUARANTOR"), for the benefit of HELLER HEALTHCARE FINANCE, INC., a Delaware
corporation  ("LENDER").
                                    RECITALS
     A.     FINANCIAL  ACCOMMODATIONS.  Lender and Emeritus Properties XIV, LLC,
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a  Washington  limited liability company ("BORROWER"), are concurrently herewith
entering  into  that  certain Loan Agreement (the "LOAN AGREEMENT") of even date
herewith  pursuant  to  which  Lender  shall  extend financial accommodations to
Borrower.
B.     INDUCEMENT.  To  induce  Lender  to  extend  to  Borrower  the  financial
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accommodations  set forth in the Loan Agreement, Guarantor is willing to execute
and  deliver  this  Guaranty.
In  consideration  of  the  foregoing,  and  for  other  good  and  valuable
consideration,  the  receipt  and  sufficiency of which are hereby acknowledged,
Guarantor  hereby  agrees  as  follows:
1.     DEFINED  TERMS
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     All  capitalized terms used herein and not otherwise defined shall have the
meanings  assigned  to  such  terms  in  the  Loan  Agreement.
2.     THE  GUARANTY
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2.1.     GUARANTY  OF  OBLIGATIONS.  Guarantor  unconditionally  and  absolutely
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guarantees  to  Lender  the  full  and  prompt payment and performance when due,
whether  at  maturity or earlier, by reason of acceleration or otherwise, and at
all  times thereafter, of the indebtedness, liabilities and obligations of every
kind  and  nature  of Borrower to Lender arising under or in any way relating to
the  Loan  Agreement  or  any  of  the  other Loan Documents, howsoever created,
incurred  or  evidenced, whether direct or indirect, absolute or contingent, now
or  hereafter  existing,  due  or  to  become  due, and howsoever owned, held or
acquired by Lender (collectively, the "OBLIGATIONS").  Without limitation to the
     foregoing,  the Obligations shall include (a) all reasonable attorneys' and
paralegals'  fees,  including the cost of inside attorneys and paralegals, costs
and  expenses  and  all  court  costs  and costs of appeal incurred by Lender in
collecting  any  amount  due  Lender  under  this Guaranty or in prosecuting any
action against Borrower, Guarantor or any other guarantor with respect to all or
any part of the Obligations (collectively, the "ENFORCEMENT COSTS"), and (b) all
interest,  fees,  costs and expenses due Lender after the filing of a bankruptcy
petition  by  or  against  Borrower  regardless  of  whether such amounts can be
collected  during  the  pendency  of  the  bankruptcy  proceedings.
2.2.     CONTINUING  GUARANTY;  GUARANTY  OF  PAYMENT.  This  Guaranty  is  a
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continuing  guaranty  of  the  Obligations,  and  Guarantor  agrees  that  the
obligations of Guarantor to Lender hereunder shall be primary obligations, shall
not  be  subject  to  any counterclaim, set-off, abatement, deferment or defense
based  upon  any  claim  that Guarantor may have against Lender, Borrower or any
other  person  or  entity.
2.3.     LIABILITY  OF  GUARANTOR  NOT  AFFECTED.  This Guaranty shall remain in
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full  force  and effect without regard to, and shall not be released, discharged
or  affected  in  any way by, any circumstances or condition, including, without
limitation:
(a)     the attempt or the absence of any attempt by Lender to obtain payment or
     performance  by  Borrower  or any other guarantor (this being a guaranty of
payment  and  performance  and  not  of  collection);
(b)     Lender's  delay in enforcing Guarantor's obligations hereunder or of any
other party under the Loan Documents, or any prior partial exercise by Lender of
any  right  or  remedy  hereunder  or  under  any  of  the other Loan Documents;
(c)     any  renewal,  extension,  substitution, modification, replacement of or
indulgence  with  respect  to,  the  Obligations,  all of which Lender is hereby
authorized  to  make;
(d)     the  fact  that Borrower is not liable for the payment or performance of
the  Obligations,  or  any portion thereof, for any reason whatsoever, Guarantor
being  liable  for  the  Obligations  notwithstanding  that Borrower may not be;
(e)     any  sale,  exchange,  release,  surrender  or  other disposition of, or
realization  upon, any collateral securing the Obligations, or any settlement or
compromise  of any guaranties of the Obligations, or any other obligation of any
person  or  entity  with  respect  to  the  Loan  Documents;
(f)     the acceptance by Lender of any additional security for the Obligations;
(g)     the lack of validity or enforceability of, or Lender's waiver or consent
with  respect  to,  any  provision  of  any  instrument  evidencing, securing or
otherwise  relating  to  the Obligations, or any part thereof, including without
limitation  the  Loan  Documents;
(h)     the failure by Lender to take any steps to perfect, maintain, or enforce
its  security interests or remedies under the Loan Documents, or to preserve its
rights  to  or  protect  any  security  or  collateral,  for  the  Obligations;
(i)     any  voluntary  or  involuntary  bankruptcy, insolvency, reorganization,
arrangement, readjustment, assignment for the benefit of creditors, composition,
receivership,  liquidation,  marshalling  of  assets  and liabilities or similar
event  or  proceedings  with respect to Borrower or Guarantor, as applicable, or
any  of  their  respective properties (each, an "INSOLVENCY PROCEEDING"), or any
action  taken  by  Lender,  any  trustee or receiver or by any court in any such
proceeding;
(j)     the  failure  by  Lender  to  file or enforce a claim against the estate
(either  in  an  Insolvency  Proceeding  or  other  proceeding)  of  Borrower or
Guarantor;
(k)     in  any  proceeding  under Title 11 of the United States Code (11 U.S.C.
Section  101  et seq.), as amended (the "BANKRUPTCY CODE"):  (i) any election by
Lender  under  Section  1111(b)(2) of the Bankruptcy Code, (ii) any borrowing or
grant  of  a security interest by Borrower as debtor-in-possession under Section
364  of  the  Bankruptcy  Code,  (iii)  the  inability  of Lender to enforce the
Obligations  against Borrower by application of the automatic stay provisions of
Section  362 of the Bankruptcy Code, or (iv) the disallowance, under Section 502
of  the  Bankruptcy  Code,  of  all  or any portion of Lender's claim(s) against
Borrower  for  repayment  of  the  Obligations;
(l)     the  failure  of Guarantor to receive notice of any intended disposition
of  the  collateral  for  the  Obligations;
(m)     any  merger  or consolidation of Borrower into or with any other entity,
or  any sale, lease or transfer of any of the assets of Borrower or Guarantor to
any  other  person  or  entity;
(n)     any  change  in  the  ownership  of  Borrower,  or  any  change  in  the
relationship  between  Borrower  and  Guarantor  or  any termination of any such
relationship;
(o)     the death, incapacity, insanity, disability, dissolution or other change
in  status  of  Borrower  or  Guarantor;
(p)     the making of additional loans to Borrower, the increase or reduction of
the  maximum  principal  amount of the Obligations, the increase or reduction in
the  interest  rate provided in the Notes, or any other modification, amendment,
release  or  waiver  of  the  terms  of  the  Loan  Documents;
(q)     the  absence,  impairment  or  loss  of  any  right  of reimbursement or
subrogation  or  other  right  or  remedy  of  Guarantor;  and
(r)     any  other  circumstance  which  might  otherwise  constitute a legal or
equitable  discharge  or  defense of Borrower, Guarantor or any other guarantor.
     Guarantor  hereby  expressly  waives  and  surrenders  any  defense  to its
liability  under  this Guaranty based upon any of the foregoing acts, omissions,
agreements, waivers or matters, whether or not Guarantor had notice or knowledge
of  same.  It is the purpose and intent of this Guaranty that the obligations of
Guarantor  hereunder  shall  be  absolute  and  unconditional  under any and all
circumstances.
2.4.     RIGHTS  OF  LENDER.  Lender  is hereby authorized, without notice to or
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demand  of Guarantor and without affecting the liability of Guarantor hereunder,
to  take  any  of  the  following  actions  from  time to time:  (a) increase or
decrease  the  amount  of,  or renew, extend, accelerate or otherwise change the
time  for  payment of, or other terms relating to, the Obligations, or otherwise
modify,  amend  or  change  the  terms of any promissory note or other agreement
evidencing, securing or otherwise relating to any of the Obligations, including,
     without  limitation,  the  making  of  additional  advances thereunder; (b)
accept  and apply any payments on or recoveries against the Obligations from any
source,  and  any  proceeds of any security therefor, to the Obligations in such
manner, order and priority as Lender may elect in its sole discretion; (c) take,
hold,  sell,  release  or  otherwise  dispose  of  all  or  any security for the
Obligations  or  the  payment of this Guaranty; (d) settle, release, compromise,
collect  or  otherwise  liquidate  the  Obligations  or any portion thereof; (e)
accept,  hold,  substitute, add or release any other guaranty or endorsements of
the  Obligations;  and  (f)  upon the failure of Guarantor to perform any of the
Obligations,  appropriate  and  apply  toward payment of the Obligations (i) any
indebtedness due or to become due from Lender to Guarantor, and (ii) any moneys,
credits,  or other property belonging to Guarantor at any time held by or coming
into  the possession of Lender or any affiliates thereof, whether for deposit or
otherwise.
     Without  limiting  the generality, scope or meaning of any of the foregoing
or  any  other  provision  of  this  Guaranty,  Guarantor:
(a)     waives  all  rights  and  defenses  that  Guarantor may have because the
Borrower's  debt  is  secured by real property.  This means, among other things:
(i)     Lender  may collect from Guarantor without first foreclosing on any real
or  personal  property  collateral  pledged  by  Borrower;
(ii)     If  Lender  forecloses  on  any  real  property  collateral  pledged by
Borrower:
(1)     the  amount  of the debt may be reduced only by the price for which that
collateral is sold at the foreclosure sale, even if the collateral is worth more
than  the  sale  price;  and
(2)     Lender  may collect from Guarantor even if Lender, by foreclosing on the
real  property collateral, has destroyed any right Guarantor may have to collect
from  Borrower;
(b)     waives  all  rights and defenses, if any, now or hereafter arising under
the  laws  of  the  State  of  Illinois, which are the same as or similar to the
rights  and  defenses  waived  as  described  above.
     This  is an unconditional and irrevocable waiver of any rights and defenses
Guarantor  may  have  because  Borrower's  debt  is  secured  by  real property.
2.5.     SUBORDINATION.  All  indebtedness now or hereafter owing by Borrower to
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Guarantor  for  borrowed money or otherwise (the "INDEBTEDNESS TO GUARANTOR") is
hereby  subordinated  to  the payment of the Obligations, and, subsequent to and
during  the  continuance  of  a default hereunder or under any of the other Loan
Documents,  Guarantor  shall  not  accept  payment of all or any portion of such
Indebtedness  to  Guarantor  until  satisfaction in full of the Obligations.  If
such  payment  is  received by Guarantor, it shall be received and held in trust
for  the  benefit of Lender and shall be paid over promptly to Lender on account
of  the  indebtedness  owed  by  Borrower  to  Lender,  but without impairing or
affecting  in  any  manner  the liability of Guarantor for the Obligations.  All
security  interests, liens and encumbrances which Guarantor, or any one of them,
now  or  hereafter  may  have  upon  any  of  the  assets of Borrower are hereby
subordinated  to  all security interests, liens and encumbrances heretofore, now
or  hereafter  granted  to  Lender  pursuant  to  the Loan Documents.  If Lender
forecloses  on  the  Project  or otherwise exercises its remedies under the Loan
Documents,  any and all indebtedness of any Borrower to Guarantor shall be fully
released  and  discharged without any further action of Guarantor; provided that
upon  request from Lender, Guarantor shall execute and deliver any documentation
reasonably  requested  by  Lender  to  evidence  such  release.
3.     GUARANTOR'S  WAIVERS
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3.1.     STATUTES  OF  LIMITATION.  Guarantor irrevocably waives all statutes of
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limitation as a defense to any action or proceeding brought against Guarantor by
     Lender,  to  the  fullest  extent  permitted  by  law.
3.2.     ELECTION  OF  REMEDIES.  Guarantor irrevocably waives any defense based
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upon  an  election  of remedies made by Lender or any other election afforded to
Lender  pursuant  to  applicable  law,  including,  without  limitation, (a) any
election  to  proceed  by  judicial  or  nonjudicial  foreclosure  or by Uniform
Commercial  Code  sale or by deed or assignment in lieu thereof, or any election
of  remedies  which  destroys or otherwise impairs the subrogation rights of the
Guarantor  or  the  rights  of  the  Guarantor  to  proceed against Borrower for
reimbursement,  or  both, (b) the waiver by Lender, either by action or inaction
of Lender or by operation of law, of a deficiency judgment against Borrower, and
(c)  any  election  pursuant  to  an  Insolvency  Proceeding.
3.3.     RIGHTS  OF  SUBROGATION AND OTHER RIGHTS.  Until payment in full of the
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Obligations,  Guarantor irrevocably waives (a) all rights at law or in equity to
seek  subrogation,  contribution,  indemnification  or  any  other  form  of
reimbursement  or  repayment  from Borrower or any other person or entity now or
hereafter  primarily  or  secondarily  liable for any of the Obligations for any
disbursements  made  by Guarantor under or in connection with this Guaranty, (b)
all  claims of any kind or type against Borrower as a result of any payment made
by  Guarantor to Lender, and (c) any right to participate in any security now or
hereafter  held  by  Lender.  In  furtherance,  and  not  in  limitation, of the
foregoing, Guarantor agrees that any payment to Lender pursuant to this Guaranty
shall  be  deemed  a  contribution to the capital of Borrower or other obligated
party  and  shall  not constitute Guarantor a creditor of Borrower or such other
party.  Guarantor  further agrees that to the extent the waiver of its rights of
subrogation as set forth herein is found by a court of competent jurisdiction to
be void or voidable for any reason, any rights of subrogation Guarantor may have
against  Borrower  or  against  any  collateral  or  security  for  any  of  the
Obligations  shall  be  junior  and  subordinate  to  any rights Lender may have
against  Borrower  and  to all right, title and interest Lender may have in such
collateral  or  security.
3.4.     DEMANDS  AND  NOTICES.  Guarantor  irrevocably waives all presentments,
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demands  for  performance,  protests,  notices  of protest, notices of dishonor,
notices  of  acceptance  of  this  Guaranty  and  of  the existence, creation or
incurring  of  new or additional Obligations, notices of defaults by Borrower or
any  other  person  liable  for the Obligations and demands and notices of every
kind  that may be required to be given by any statute or rule or law, other than
notices  specifically  required  by  the  terms  of  the  Loan  Documents.
3.5.     BORROWER  INFORMATION.  Guarantor  irrevocably  waives  (a) any duty of
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Lender  to  advise  Guarantor  of  any information known to Lender regarding the
financial  condition  of  Borrower (it being the obligation of Guarantor to keep
informed  regarding such condition), and (b) any defense based on any claim that
Guarantor's  obligations  exceed  or are more burdensome than those of Borrower.
3.6.     LIMITATION  OF LIABILITY.  Guarantor irrevocably waives any impairment,
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modification,  change,  release  or  limitation  of the liability of, or stay of
actions  or  lien  enforcement proceedings against, Borrower or Guarantor, their
property,  or  their  estate  in bankruptcy, resulting from the operation of any
provision  of  the state or federal bankruptcy laws, or from the decision of any
court.
3.7.     LACK  OF DILIGENCE.  Guarantor irrevocably waives any and all claims or
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defenses  based  upon  lack of diligence in:  (a) collection of any Obligations;
(b)  protection  of  any  collateral  or  other security for the Indebtedness or
Obligations;  or  (c)  realization  upon  the  other  Loan  Documents.
3.8.     OTHER  DEFENSES.  Guarantor  irrevocably  waives  any  other  defenses,
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set-offs  or  counterclaims  which  may  be  available to Borrower, or any other
Guarantor  if  there are more than one, and any and all other defenses now or at
any  time  hereafter  available to Guarantor (including without limitation those
given  to  sureties)  at  law  or  in  equity.
4.     REPRESENTATIONS  AND  WARRANTS
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     Guarantor  represents  and  warrants  to  Lender  as  follows:
4.1.     AUTHORITY;  EXECUTION.  This  Guaranty  has  been  duly  and  validly
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authorized,  executed  and  delivered  and constitutes the binding obligation of
Guarantor,  enforceable  in  accordance  with  its  terms.
4.2.     FINANCIAL  STATEMENTS.  All  financial  statements  and other financial
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information  concerning Guarantor furnished or to be furnished to Lender (a) are
or  will  be  true  and  correct  in all material respects and do or will fairly
represent  in  all  material  respects  the  financial  condition  of  Guarantor
(including  all  contingent  liabilities),  and  (b) were or will be prepared in
accordance  with  generally  accepted  accounting  principles,  or  such  other
accounting  principles  as  may  be  acceptable  to  Lender at the time of their
preparation, consistently applied.  There has been no material adverse change in
Guarantor's  financial condition since the dates of the statements most recently
furnished  Lender.
4.3.     NO  DEFAULTS.  There  is no existing event of default, and no event has
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occurred which with the passage of time and/or the giving of notice or both will
constitute  an  event  of  default,  under any agreement to which Guarantor is a
party, the effect of which event of default will impair performance by Guarantor
of  the  Obligations  pursuant  to  and  as  contemplated  by  the terms of this
Guaranty, and neither the execution and delivery of this Guaranty nor compliance
with  the  terms  and  provisions  hereof  will  violate  any presently existing
provision  of  law or any presently existing regulation, order, writ, injunction
or  decree  of  any court or governmental department, commission, board, bureau,
agency or instrumentality, or constitute a default under, any agreement to which
Guarantor  is  a  party  or  by  which  Guarantor  is  bound.
4.4.     NO  LITIGATION.  There  are no actions, suits or proceedings pending or
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threatened  against  the  Guarantor  before  any  court  or  any  governmental,
administrative,  regulatory, adjudicatory or arbitrational body or agency of any
kind  that  will  adversely  affect  performance by the Guarantor of Guarantor's
obligations  pursuant to and as contemplated by the terms and provisions of this
Guaranty.
4.5.     ACCURACY.  Neither this Guaranty nor any document, financial statement,
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credit  information,  certificate  or statement heretofore furnished or required
herein  to  be furnished to Lender by Guarantor contains any untrue statement of
fact  or  omits  to  state  a  fact  material  to  this  Guaranty.
5.     EVENTS  OF  DEFAULT
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     Upon  the  occurrence  of  any of the following events, Lender may, without
notice  to Borrower or Guarantor, declare any or all of the Obligations, whether
or  not  then due, immediately due and payable by Guarantor under this Guaranty,
and  Lender shall be entitled to enforce the obligations of Guarantor hereunder.
5.1.     DEFAULT  BY  BORROWER.  Borrower  shall  default  in  the  payment  or
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performance  of any of the Obligations guarantied hereby, after giving effect to
any  applicable  notice  and  cure  provisions  set forth in the Loan Documents.
5.2.     FAILURE  TO PERFORM.  Guarantor fails to perform any of its obligations
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under  this  Guaranty or any agreement under which security is given herefor, or
this  Guaranty  is  revoked or terminated by Guarantor, or any representation or
warranty  made  or given by Guarantor to Lender proves to be false or misleading
in  any  material  respect.
5.3.     INSOLVENCY  PROCEEDING.  The  making by Guarantor of any assignment for
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the benefit of creditors, or a trustee or receiver being appointed for Guarantor
or for any property of Guarantor, or Guarantor becoming insolvent or the subject
of  any  Insolvency  Proceeding  and,  in  the  case  of such a proceeding being
commenced against Guarantor, such proceeding is not dismissed within thirty (30)
days  following  the  commencement  date  thereof.
6.     MISCELLANEOUS
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6.1.     REVIVAL  AND  REINSTATEMENT.  If  at  any  time  all or any part of any
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payment  theretofore  applied  by Lender to any of the Obligations is or must be
rescinded  or  returned  by Lender for any reason whatsoever (including, without
limitation,  the  insolvency,  bankruptcy  or  reorganization of Borrower), such
Obligations shall, for the purposes of this Guaranty, to the extent such payment
     is  or  must  be  rescinded  or  returned,  be  deemed to have continued in
existence,  notwithstanding  such application by Lender, and this Guaranty shall
continue  to  be  effective  or  be  reinstated,  as the case may be, as to such
Obligations,  and  Guarantor shall be fully liable therefore, all as though such
application  by  Lender  had  not  been  made.
6.2.     NO MARSHALING.  Lender has no obligation to marshal any assets in favor
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of Guarantor, or against or in payment of (a) any of the Obligations, or (b) any
other  obligation  owed  to  Lender  by Guarantor, Borrower or any other person.
6.3.     NO  MODIFICATION,  WAIVER  OR  RELEASE  WITHOUT WRITING.  Except as may
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otherwise  be  expressly  set  forth  herein, this Guaranty may not be modified,
amended,  revised, revoked, terminated, changed or varied in any way whatsoever,
nor  shall  any waiver of any of the provisions of this Guaranty be binding upon
Lender,  except as expressly set forth in a writing duly executed by Lender.  No
waiver  by  Lender of any default shall operate as a waiver of any other default
or  the  same  default  on  a future occasion, and no action by Lender permitted
hereunder  shall  in any way affect or impair Lender's rights or the obligations
of  Guarantor  under  this  Guaranty.
6.4.     ASSIGNMENT;  SUCCESSORS  AND  ASSIGNS.  Guarantor  may  not  assign
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Guarantor's  obligations  or  liability  under  this  Guaranty.  Subject  to the
preceding  sentence,  this  Guaranty  shall  be  binding  upon Guarantor and its
successors, assigns, heirs, executors and representatives and shall inure to the
benefit of Lender and its successors and assigns.  Lender may, without notice to
anyone, sell or assign the Obligations, the Notes or other Loan Documents or any
part  thereof,  or  grant participations therein, and in any such event each and
every  assignee  or  holder of, or participant in, all or any of the Obligations
shall  have  the  right  to  enforce this Guaranty, by suit or otherwise for the
benefit  of such assignee, holder, or participant, as fully as if herein by name
specifically  given such right, but Lender shall have an unimpaired right, prior
and  superior  to  that  of any such assignee, holder or participant, to enforce
this  Guaranty  for  the  benefit  of  Lender.
6.5.     INTEGRATION.  This  Guaranty  is the entire agreement of Guarantor with
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respect  to  the  subject  matter  of this Guaranty, provided that this Guaranty
shall  not  in  any way limit or abrogate the obligations of Guarantor under the
other  Loan  Documents,  including,  without limitation, the Hazardous Materials
Indemnity  Agreement  of  even  date  herewith.
6.6.     RIGHTS  CUMULATIVE.  All  of  Lender's  rights  or  remedies under this
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Guaranty  and  the other Loan Documents are cumulative.  The exercise of any one
right  or  remedy does not exclude the exercise of any other right given in this
Guaranty  or the other Loan Documents or any other right or remedy of Lender not
set  forth  in  this  Guaranty  or  the  other  Loan  Documents.
6.7.     SEVERABILITY.  Whenever  possible each provision of this Guaranty shall
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be interpreted in such manner as to be effective and valid under applicable law,
but  if  any  provision of this Guaranty shall be prohibited by or invalid under
such  law, such provision shall be ineffective to the extent of such prohibition
or  invalidity,  without  invalidating  the  remainder  of such provision or the
remaining  provisions  of  this  Guaranty.
6.8.     MATERIAL  INDUCEMENT; CONSIDERATION.  Guarantor acknowledges and agrees
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that  Lender  is  specifically  relying  upon  the  representations, warranties,
agreements  and  waivers  contained  herein  and  that  such  representations,
warranties, agreements and waivers constitute a material inducement to Lender to
accept  this  Guaranty  and to enter into the Loan Agreement and the transaction
contemplated therein.  Guarantor further acknowledges that it expects to benefit
from  Lender's  extension of financing accommodations to Borrower because of its
relationship  to  Borrower,  and  that  it  is  executing  this  Guaranty  in
consideration  of  that  anticipated  benefit.
6.9.     INDEMNIFICATION.  Guarantor  agrees  to  indemnify, pay and hold Lender
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and  its  respective  officers,  directors,  employees,  Lender,  and  attorneys
(collectively  called  the  "INDEMNITEES") harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims,  costs,  expenses  and  disbursements  of  any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for such Indemnitees
in  connection  with  any  investigative,  administrative or judicial proceeding
commenced  or  threatened,  whether or not such Indemnitee shall be designated a
party  thereto)  that  may  be imposed on, incurred by, or asserted against that
Indemnitee,  in  any  manner  relating to or arising out of this Guaranty or the
exercise  of  any  right  or  remedy  hereunder  or  under  the  other documents
pertaining  to  the  Obligations  (the "INDEMNIFIED LIABILITIES"); provided that
                                                                   --------
Guarantor  shall  have no obligation to an Indemnitee under this subsection with
respect  to Indemnified Liabilities arising from the gross negligence or willful
misconduct  of  that  Indemnitee  as  determined  by  a  court  of  competent
jurisdiction.  To  the  extent  that  the undertaking to indemnify, pay and hold
harmless  set forth in the preceding sentence may be unenforceable because it is
violative  of  any  law or public policy, Guarantor shall contribute the maximum
portion  that  it  is  permitted  to pay and satisfy under applicable law to the
payment  and  satisfaction  of  all  Indemnified  Liabilities  incurred  by  the
Indemnitees  or  any  of  them.
6.10.     COUNTERPARTS.  This  Guaranty may be executed in counterparts, each of
          ------------
which  shall be deemed an original, but all of which, when taken together, shall
be  deemed  one  and  the  same  agreement.
6.11.     GOVERNING  LAW.  This  Guaranty  shall be governed by and construed in
          --------------
accordance  with  the  internal laws of the State of Illinois, without regard to
conflicts  of  law  provisions.
6.12.     INTENTIONALLY  OMITTED.
          ----------------------
6.13.     VENUE.  GUARANTOR  HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR
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FEDERAL  COURT  LOCATED  WITHIN  THE  COUNTY  OF  COOK,  STATE  OF  ILLINOIS AND
IRREVOCABLY  AGREES  THAT,  SUBJECT  TO  LENDER'S  ELECTION,  ALL  ACTIONS  OR
PROCEEDINGS  ARISING  OUT  OF OR RELATING TO THIS GUARANTY SHALL BE LITIGATED IN
SUCH  COURTS.  GUARANTOR  EXPRESSLY  SUBMITS AND CONSENTS TO THE JURISDICTION OF
THE  AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS.  GUARANTOR
HEREBY  WAIVES  PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH
SERVICE  OF  PROCESS MAY BE MADE UPON GUARANTOR BY CERTIFIED OR REGISTERED MAIL,
RETURN  RECEIPT REQUESTED, ADDRESSED TO SUCH GUARANTOR, AT THE ADDRESS SET FORTH
IN  THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE
SAME  HAS  BEEN  POSTED.
6.14.     WAIVER  OF  JURY  TRIAL.  GUARANTOR,  AND  BY  ITS  ACCEPTANCE OF THIS
          -----------------------
GUARANTY, LENDER, HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY IN ANY
ACTION  OR  PROCEEDING  BASED  UPON,  OR  RELATED TO, THE SUBJECT MATTER OF THIS
GUARANTY  AND  THE BUSINESS RELATIONSHIP THAT IS BEING ESTABLISHED.  THIS WAIVER
IS  KNOWINGLY,  INTENTIONALLY AND VOLUNTARILY MADE BY GUARANTOR, AND BY LENDER'S
ACCEPTANCE  OF  THIS  GUARANTY,  LENDER  AND  GUARANTOR ACKNOWLEDGE THAT NEITHER
LENDER NOR ANY PERSON ACTING ON BEHALF OF LENDER HAS MADE ANY REPRESENTATIONS OF
FACT  TO  INDUCE  THIS WAIVER OF TRIAL BY JURY OR HAS TAKEN ANY ACTIONS WHICH IN
ANY  WAY  MODIFY  OR  NULLIFY  ITS  EFFECT.
6.15.     WAIVERS.  THE  WAIVERS  SET FORTH IN THIS GUARANTY (INCLUDING, WITHOUT
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LIMITATION,  SECTIONS  6.13  AND  6.14  ABOVE) ARE KNOWINGLY, INTENTIONALLY, AND
VOLUNTARILY  MADE  BY GUARANTOR, AND GUARANTOR ACKNOWLEDGES THAT NEITHER  LENDER
NOR  ANY PERSON ACTING ON BEHALF OF LENDER, HAS MADE ANY REPRESENTATIONS OF FACT
TO  INDUCE  THESE  WAIVERS  OR  IN  ANY  WAY  TO MODIFY OR NULLIFY THEIR EFFECT.
GUARANTOR  FURTHER  ACKNOWLEDGES  THAT  IT  HAS BEEN REPRESENTED (OR HAS HAD THE
OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF THIS GUARANTY AND IN THE MAKING
OF  THESE  WAIVERS  BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL,
AND  THAT  IT  HAS  HAD  THE  OPPORTUNITY TO DISCUSS THESE WAIVERS WITH COUNSEL.
7.     LIMITATION  OF  LIABILITY
       -------------------------
     Except as provided in the next sentence, the maximum liability of Guarantor
under  this  Guaranty  is  limited  to  the principal amount of Two Million Five
Hundred  Thousand  and  No/100  Dollars ($2,500,000.00); plus accrued and unpaid
interest  and  all  Enforcement  Costs.
In addition to the amounts set forth in the preceding sentence, Guarantor shall,
jointly  and  severally  with  Borrower,  be  personally  liable  for:
(a)     all  losses, damages, costs and expenses (including, without limitation,
attorney's  fees), causes of action, suits, claims, demands and judgments of any
nature  or  description  whatsoever,  which  may be imposed upon, incurred by or
awarded  against  Lender  or  any  affiliate  thereof  as  a  result  of:
(i)     any  failure  after  the  occurrence  and  during the continuance of any
default  (without  benefit  of any applicable grace or cure period) to apply any
portion  of  the  gross  income  from  the  Project  to the Loan or to customary
operating  expenses  of  the  Project,
(ii)     fraud  by  Borrower  or  Guarantor,
(iii)     any  misappropriation  of  any  funds  derived  from  the  Project,
(iv)     any  material  misrepresentation  by  Borrower  or  Guarantor,
(v)     any  material  waste  or  abandonment  of  the  Project,
(vi)     failure to keep the Project insured in accordance with the terms of the
Loan  Documents,
(vii)     fees paid to Guarantor or any affiliate of Borrower or Guarantor after
any  default  (other  than a default occurring solely due to a default under the
Other  Loan  Instruments  (as  defined in the Mortgage)) or any Event of Default
under  the  Loan  Documents,  or
(viii)     any  breach  of  any representation, warranty, covenant or obligation
concerning  Hazardous  Materials (as defined in the Environmental Indemnity) set
forth in the Loan Agreement or set forth in the Environmental Indemnity, each as
amended  from  time  to  time;  and
(b)     repayment  of  the  Loan and all other obligations of Borrower under the
Loan  Documents  in  the  event  of  (i)  any  breach of any of the covenants in
Sections  11 or 12 of the Mortgage pertaining to change of control, transfers of
       -  --------
interests and additional encumbrances, (ii) any breach of the warranty set forth
     in  Section  4.16 of the Loan Agreement (single asset entity), or (iii) the
filing  by  Borrower,  or  the  filing  against  Borrower  by  Guarantor, of any
proceeding  for  relief  under  any  federal  or state bankruptcy, insolvency or
receivership  laws  or  any  assignment  for  the  benefit  of creditors made by
Borrower.
     Neither  this  Guaranty  nor  any  of  the  provisions  contained  herein
(including,  without  limitation,  this Section 7) shall in any manner affect or
limit  or  reduce  in any way the liability of Guarantor under the Environmental
Indemnity.

<PAGE>
The  undersigned  have duly executed this Guaranty as of the date and year first
above  written.
EMERITUS  CORPORATION,  a  Washington  corporation

By    /s/  Raymond  R.  Brandstrom
  --------------------------------
Name     Raymond  R.  Brandstrom
Its           CFO