LOAN NO. 07-0004017

                  COLLATERAL ASSIGNMENT OF MANAGEMENT AGREEMENT
              AND WAIVER OF PROPERTY MANAGEMENT AND BROKER'S LIENS


     THIS  COLLATERAL  ASSIGNMENT OF MANAGEMENT AGREEMENT AND WAIVER OF PROPERTY
MANAGEMENT  AND  BROKER'S  LIENS  ("AGREEMENT")  is  made  as of the 26th day of
August, 2002, by EMERITUS CORPORATION, a Washington corporation ("MANAGER"), and
EMERITUS  PROPERTIES  XIV,  LLC,  a  Washington  limited  liability  company
("BORROWER"),  to  and  for  the  benefit  of HELLER HEALTHCARE FINANCE, INC., a
Delaware  corporation  ("LENDER").
                                    RECITALS
A.     Borrower  is  the  owner of the real estate legally described in attached
Exhibit  A  (the  "PROPERTY").
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B.     Borrower  and  Manager  have  entered into a certain Management Agreement
pursuant  to  which  Manager  has  agreed  to render certain property management
services  and  leasing  brokerage  services  (the  "MANAGEMENT  AGREEMENT").
C.     Lender  has  agreed,  subject  to certain terms and conditions, to make a
loan to Borrower in an amount not to exceed Eight Million Three Hundred Thousand
and  No/100  Dollars  ($8,300,000.00)  (the  "LOAN").  The Loan is evidenced and
governed by a certain Promissory Note A of even date herewith in the face amount
of  Five  Million  Three  Hundred  Ninety-Five  Thousand  and  No/100  Dollars
($5,395,000.00),  that  certain  Subordinated  Promissory  Note  B  of even date
herewith in the face amount of Two Million Nine Hundred Five Thousand and No/100
Dollars  ($2,905,000.00)  and  that certain Loan Agreement by and between Lender
and  Borrower  of  even  date  herewith,  as  the  same may from time to time be
renewed,  amended,  modified,  increased,  consolidated  or  extended (the "LOAN
AGREEMENT").  All  capitalized terms not otherwise defined herein shall have the
meanings  assigned  to  them  in  the  Loan  Agreement.
D.     To  induce  Lender  to  make  the Loan, Borrower has agreed to assign, as
security  for the Loan, its rights under the Management Agreement and Manager is
willing  to  waive  any and all liens to which it is or will be entitled, now or
hereafter,  arising  in  respect  of  the  Management  Agreement or the services
performed,  or  expenses  incurred, thereunder, including without limitation any
mechanic's  or  materialman's lien claim or broker's lien claim under applicable
law  (the  "MANAGER'S  LIENS").
                                   AGREEMENTS
1.     To secure the Loan, Borrower hereby, sells, conveys and assigns to Lender
     all  its  right,  title  and  interest  in and to the Management Agreement.
Manager hereby consents to such assignment.  Borrower, Lender and Manager hereby
agree  that,  upon  the occurrence of a monetary default under and as defined in
the  Loan  Agreement,  Lender  shall  have the right, but not the obligation, to
elect, by giving written notice to Borrower and Manager, either to:  (i) enforce
the  obligations  of  Manager  under  the  Management  Agreement, in which event
Manager  will  recognize  Lender  as  owner  of the Property for purposes of the
Management  Agreement;  provided  that  all  sums  payable  under the Management
Agreement  accruing  from and after the date of delivery of such notice are paid
when  due, or (ii) terminate the Management Agreement as of the date of delivery
of such notice without payment of any termination fees or charge notwithstanding
anything  to  the  contrary in the Management Agreement, in which event Borrower
shall  make no further payments to Manager and Manager shall not accept any such
payments  and  Manager  shall  promptly  deliver to Lender all books and records
pertaining  to  the  operation  and  management  of  the  mortgaged  property.
2.     Manager  acknowledges  that  pursuant  to  the  terms  of  the Management
Agreement  Manager  is required to maintain insurance for the Property.  Manager
agrees that it shall maintain such insurance in accordance with the requirements
of  the Mortgage, a copy of which Manager acknowledges it has reviewed.  In case
of loss or damage to the Property by fire or other casualty, Manager or Borrower
shall  give,  or  cause  to  be  given,  written notice thereof to the insurance
carrier(s)  and  to  Lender  within  three  (3) business days after such loss or
damage  occurs.  Lender  is  authorized  and  empowered,  and  Manager  hereby
irrevocably appoints Lender as its attorney-in-fact (such appointment is coupled
with  an  interest), at its option, to make or file proofs of loss or damage and
to  settle  and  adjust  any claim under insurance policies which insure against
such  risks,  or  to  direct  Manager,  in  writing, to agree with the insurance
carrier(s)  on  the  amount  to  be  paid  in  regard  to  such  loss.
3.     The  assignment  made  hereby  is for collateral purposes only and Lender
shall  not  be  deemed  to  have  assumed,  or become liable for, the payment or
performance of any of the obligations or liabilities of Borrower arising from or
in  connection with the Management Agreement whether arising before or after the
occurrence  of an Event of Default, unless and until Lender delivers to Borrower
and  Manager  the  above  described  notice  of  its  election  to  enforce  the
obligations  of  Manager, as provided above, in which event Lender shall have no
liability  for  any obligations or liabilities accruing prior to the date of the
delivery  of  such  notice.
4.     The  Manager's  Liens  are  hereby  waived.
5.     Any notice or other communication required or permitted to be given shall
be  in  writing  addressed to the respective party as set forth below and may be
personally  served,  telecopied  or  sent  by overnight courier or U.S. Mail and
shall be deemed given:  (a) if served in person, when served; (b) if telecopied,
on  the  date  of  transmission if before 3:00 p.m. (Chicago time) on a business
day;  provided  that  a hard copy of such notice is also sent pursuant to (c) or
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(d) below; (c) if by overnight courier, on the first business day after delivery
to  the  courier;  or  (d) if by U.S. Mail, certified or registered mail, return
receipt  requested  on  the  fourth  (4th) day after deposit in the mail postage
prepaid.
     Emeritus  Corporation
     3131  Elliott  Avenue,  Suite  500
     Seattle,  Washington  98121
     Attn:  Raymond  R.  Brandstrom,  CFO
Notices  to  Manager:     Facsimile:  (206)  301-4500
     Emeritus  Properties  XIV,  LLC
     3131  Elliott  Avenue,  Suite  500
     Seattle,  Washington  98121
     Attn:  Raymond  R.  Brandstrom,  CFO
Notices  to  Borrower:     Facsimile:  (202)  301-4500
     The  Nathanson  Group  PLLC
     1520  Fourth  Avenue,  Sixth  Floor
     Seattle,  Washington  98101
     Attn:  Randi  S.  Nathanson
With  a  copy  to:     Facsimile:  (206)  623-1738
     Heller  Healthcare  Finance,  Inc.
     Loan  No.  07-0004017
     2  Wisconsin  Circle,  Suite  400
     Chevy  Chase,  Maryland  20815
     Attn:  Manager,  Portfolio  Management  Group
Notices  to  Lender:     Telecopy:  (301)  664-9843
     Heller  Healthcare  Finance,  Inc.
     Loan  No.  07-0004017
     100  Congress,  Suite  700
     Austin,  Texas  78701
     Attn:  Diana  Pennington,  Vice  President and Chief Counsel, Senior Living
Group
With  a  copy  to:     Telecopy:  (512)  476-7832
     Heller  Healthcare  Finance,  Inc.
     Loan  No.  07-0004017
     500  West  Monroe  Street
     Chicago,  Illinois  60661
     Attn:  Kevin  McMeen,  Senior  Vice  President
And  a  copy  to:     Telecopy:  (312)  441-7119
6.     Neither  Borrower  nor Manager shall permit or agree to any modification,
amendment  or termination of the Management Agreement (other than the expiration
of  the  Management  Agreement  on  the  expiry date, if any, set forth herein),
without  the  prior  written  consent  of Lender, which consent Lender shall not
unreasonably  withhold  or  delay.
7.     This  Agreement shall be governed by and construed in accordance with the
internal  laws  of  the  State  of  Illinois.
8.     MANAGER, BORROWER AND LENDER, BY ITS ACCEPTANCE OF THIS AGREEMENT, 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 AGREEMENT AND THE BUSINESS
RELATIONSHIP THAT IS BEING ESTABLISHED.  THIS WAIVER IS KNOWINGLY, INTENTIONALLY
AND  VOLUNTARILY  MADE  BY  MANAGER, BORROWER AND LENDER, AND MANAGER AND LENDER
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.  MANAGER,
BORROWER  AND  LENDER  ACKNOWLEDGE  THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO
ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH OF THEM HAS ALREADY RELIED ON THIS
WAIVER  IN  ENTERING  INTO THIS AGREEMENT AND THAT EACH OF THEM WILL CONTINUE TO
RELY  ON  THIS  WAIVER  IN THEIR RELATED FUTURE DEALINGS.  MANAGER, BORROWER AND
LENDER  FURTHER  ACKNOWLEDGE  THAT  THEY  HAVE BEEN REPRESENTED (OR HAVE HAD THE
OPPORTUNITY  TO  BE  REPRESENTED)  IN  THE  SIGNING OF THIS AGREEMENT AND IN THE
MAKING  OF  THIS  WAIVER  BY  INDEPENDENT  LEGAL  COUNSEL.
9.     MANAGER  AND  BORROWER HEREBY CONSENT TO THE JURISDICTION OF ANY STATE OR
FEDERAL  COURT  LOCATED  WITHIN  THE  COUNTY  OF  COOK,  STATE  OF  ILLINOIS AND
IRREVOCABLY AGREE THAT, SUBJECT TO LENDER'S ELECTION, ALL ACTIONS OR PROCEEDINGS
ARISING  OUT  OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS SHALL
BE  LITIGATED IN SUCH COURTS.  MANAGER AND BORROWER EXPRESSLY SUBMIT AND CONSENT
TO  THE  JURISDICTION OF THE AFORESAID COURTS AND WAIVE ANY DEFENSE OF FORUM NON
CONVENIENS.  MANAGER  AND  BORROWER HEREBY WAIVE PERSONAL SERVICE OF ANY AND ALL
PROCESS  AND  AGREE THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON MANAGER OR
BORROWER,  AS  THE  CASE MAY BE, BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT
REQUESTED,  ADDRESSED TO MANAGER OR BORROWER, AS THE CASE MAY BE, AT THE ADDRESS
SET  FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS
AFTER  THE  SAME  HAS  BEEN  POSTED.

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IN WITNESS WHEREOF, the undersigned have executed this instrument on the day and
year  first  above  written.

MANAGER:

EMERITUS  CORPORATION,
a  Washington  corporation


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


BORROWER:

EMERITUS  PROPERTIES  XIV,  LLC,  a  Washington  limited  liability  company

By     Emeritus  Corporation,  a  Washington  corporation,  its  sole  member

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

LENDER:

HELLER  HEALTHCARE  FINANCE,  INC.,
a  Delaware  corporation


By      /s/  Jeffrey  M.  Muchmore
Name       Jeffrey  M.  Muchmore
Its             Vice  President


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                                    EXHIBIT A
                                LEGAL DESCRIPTION
Record  Owner:     Emeritus  Properties  XIV,  LLC

Legal  Description: