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 OF 1934

               For the quarterly period ended      March 31, 2002
                                              -------------------

                                       OR

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

                        For the transition period from to



                           Commission File No. 0-19137


                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP
                  --------------------------------------------
             (Exact name of registrant as specified in its charter)

    Massachusetts                                                 04-3057290
    (State or other jurisdiction of                             (IRS Employer
   incorporation or organization)                         Identification No.)

    88 Broad Street, Boston, MA                                        02110
   (Address of principal executive offices)                        (Zip Code)


Registrant's  telephone  number,  including  area  code     (617)  854-5800
                                                        -------------------


(Former  name,  former  address  and  former  fiscal year, if changed since last
report.)


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.
Yes    X  No_____
   -----



<PAGE>



                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP

                                    FORM 10-Q

                                      INDEX


<TABLE>
<CAPTION>


PART I. FINANCIAL INFORMATION:                                           Page
                                                                         ----
<S>                                                                      <C>
     Item 1. Financial Statements

                Statement of Financial Position
                at March 31, 2002 and December 31, 2001                     3

                Statement of Operations
                for the three months ended March 31, 2002 and 2001          4

                Statement of Cash Flows
                for the three months ended March 31, 2002 and 2001          5

                Notes to the Financial Statements                           6


     Item 2. Management's Discussion and Analysis of Financial
                 Condition and Results of Operations                       11

     Item 3. Quantitative and Qualitative Disclosures about Market Risk    17


PART II. OTHER INFORMATION:

     Item 1 - 6                                                            18
</TABLE>




<PAGE>

                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP

                         STATEMENT OF FINANCIAL POSITION

                      MARCH 31, 2002 AND DECEMBER 31, 2001

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                              March 31,      December 31,
                                                                 2002            2001
                                                             --------------  --------------
ASSETS
<S>                                                         <C>             <C>

Cash and cash equivalents                                   $   5,243,983   $   3,907,407
Rents receivable, net of allowance of $49,163 and $43,919
  at March 31, 2002 and December 31, 2001, respectively            29,091          60,747
Accounts receivable - affiliate                                     4,382             984
Other assets                                                       32,894           4,859
Interest receivable - loan, net of allowance of $590,772
  at March 31, 2002 and December 31, 2001                               -               -
Loan receivable, net of allowance of $318,500
  at March 31, 2002 and December 31, 2001                       3,321,500       3,321,500
Net investment in sales-type lease                                      -          17,755
Equipment at cost, net of accumulated depreciation
  of $2,650,672 and $2,585,327 at March 31, 2002
  and December 31, 2001, respectively                           2,146,442       2,211,787
                                                            --------------  --------------

      Total assets                                          $  10,778,292   $   9,525,039
                                                            ==============  ==============


LIABILITIES AND PARTNERS' CAPITAL

Notes payable                                               $     984,248   $   1,038,675
Accrued interest                                                    6,693           6,611
Accrued liabilities                                               510,487         666,106
Accrued liabilities - affiliate                                    26,967          22,888
                                                            --------------  --------------
     Total liabilities                                          1,528,395       1,734,280
                                                            --------------  --------------

Partners' capital (deficit):
   General Partner                                             (2,532,962)     (2,605,919)
   Limited Partnership interests
   (2,714,647 Units; initial purchase price of $25 each)       11,782,859      10,396,678
                                                            --------------  --------------
     Total partners' capital                                    9,249,897       7,790,759
                                                            --------------  --------------

     Total liabilities and partners' capital                $  10,778,292   $   9,525,039
                                                            ==============  ==============
</TABLE>





   The accompanying notes are an integral part of these financial statements.

<PAGE>

                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP

                             STATEMENT OF OPERATIONS

               FOR THE THREE MONTHS ENDED MARCH 31, 2002 AND 2001

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                             2002           2001
..                                        ------------   ------------
INCOME
<S>                                      <C>            <C>
Operating lease revenue                  $      86,195  $     155,995
Sales-type lease revenue                             -          3,351
Interest income                                 18,651         30,121
Interest income - loan                               -        144,686
Other income                                 1,562,774              -
                                         -------------  -------------
  Total income                               1,667,620        334,153
                                         -------------  -------------

EXPENSES

Depreciation                                    65,345         65,346
Interest expense                                19,178         17,393
Equipment management fees - affiliate            6,046         10,750
Bad debt expense                                22,999              -
Operating expenses - affiliate                  94,914        141,432
                                         -------------  -------------
  Total expenses                               208,482        234,921
                                         -------------  -------------

Net income                               $   1,459,138  $      99,232
                                         =============  =============



Net income per limited partnership unit  $        0.51  $        0.03
                                         =============  =============
Cash distributions declared
   per limited partnership unit          $           -  $           -
                                         =============  =============
</TABLE>
















   The accompanying notes are an integral part of these financial statements.
<PAGE>
                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP

                             STATEMENT OF CASH FLOWS

               FOR THE THREE MONTHS ENDED MARCH 31, 2002 AND 2001

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                              2002            2001
..                                                         ------------    ------------
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES
<S>                                                      <C>             <C>
Net income                                               $   1,459,138   $      99,232
Adjustments to reconcile net income to net
 cash provided by (used in) operating activities:
  Depreciation                                                  65,345          65,346
  Bad debt expense                                              22,999               -
  Sales-type lease revenue                                           -          (3,351)
Changes in assets and liabilities:
  Rents receivable                                              26,412         116,820
  Accounts receivable - affiliate                               (3,398)        (36,717)
  Other assets                                                 (28,035)        (24,087)
  Interest receivable - loan                                         -        (144,686)
  Collections on net investment in sales-type lease                  -          58,995
  Accrued interest                                                  82          (7,043)
  Accrued liabilities                                         (155,619)       (178,102)
  Accrued liabilities - affiliate                                4,079           7,913
  Deferred rental income                                             -          24,848
                                                         --------------  --------------
    Net cash provided by (used in) operating activities      1,391,003         (20,832)
                                                         --------------  --------------

CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES

Proceeds from notes payable                                          -         505,028
Principal payments - notes payable                             (54,427)       (220,340)
                                                         --------------  --------------
    Net cash provided by (used in) financing activities        (54,427)        284,688
                                                         --------------  --------------

Net increase (decrease) in cash and cash equivalents         1,336,576         263,856
Cash and cash equivalents at beginning of period             3,907,407       2,827,385
                                                         --------------  --------------
Cash and cash equivalents at end of period               $   5,243,983   $   3,091,241
                                                         ==============  ==============

SUPPLEMENTAL INFORMATION

Cash paid during the period for interest                 $      19,096   $      24,436
                                                         ==============  ==============
</TABLE>


SUPPLEMENTAL  DISCLOSURE  OF  NON-CASH  ACTIVITY:

In  February  2001,  the Partnership refinanced certain indebtedness and accrued
interest  in  the  amount  of  $706,831.

   The accompanying notes are an integral part of these financial statements.

<PAGE>
                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP

                        NOTES TO THE FINANCIAL STATEMENTS

                                 MARCH 31, 2002


                                   (UNAUDITED)


NOTE  1  -  BASIS  OF  PRESENTATION
-----------------------------------

The  financial  statements  presented  herein  are  prepared  in conformity with
generally accepted accounting principles and the instructions for preparing Form
10-Q  under  Rule  10-01  of  Regulation  S-X  of  the  Securities  and Exchange
Commission  and  are  unaudited.  As  such,  these  financial  statements do not
include  all  information  and  footnote  disclosures  required  under generally
accepted  accounting  principles  for  complete  financial  statements  and,
accordingly, the accompanying financial statements should be read in conjunction
with the financial statements and related footnotes presented in the 2001 Annual
Report  (Form  10-K)  of  AIRFUND  II  International  Limited  Partnership  (the
"Partnership").  Except  as  disclosed herein, there has been no material change
to the information presented in the footnotes to the 2001 Annual Report included
in  Form  10-K.

In  the  opinion  of  management,  all  adjustments  (consisting  of  normal and
recurring  adjustments)  considered  necessary  to  present fairly the financial
position  at  March 31, 2002 and December 31, 2001 and results of operations for
the  three  month  periods  ended March 31, 2002 and 2001 have been made and are
reflected.


NOTE  2  -  REVENUE  RECOGNITION
--------------------------------

Rents  are  payable  to  the Partnership monthly or quarterly and no significant
amounts  are calculated on factors other than the passage of time.  The majority
of  the  leases  are  accounted  for as operating leases and are noncancellable.
Rents received prior to their due dates are deferred.  In certain instances, the
Partnership  may  enter  renewal  or re-lease agreements which expire beyond the
Partnership's  anticipated  dissolution date.  This circumstance is not expected
to  prevent  the orderly wind-up of the Partnership's business activities as the
General  Partner,  wholly  owned  by  Equis  Financial Group Limited Partnership
("EFG"),  would  seek  to sell the then-remaining equipment assets either to the
lessee  or  to  a  third  party,  taking into consideration the amount of future
noncancellable  rental  payments associated with the attendant lease agreements.
Future  minimum  rents  for  operating  leases  of  $766,487 are due as follows:
<TABLE>
<CAPTION>

<S>                            <C>    <C>

For the year ending March 31,   2003  $349,861
                                2004   294,089
                                2005   122,537
                                      --------

..                              Total  $766,487
                                      ========
</TABLE>




NOTE  3  -  EQUIPMENT
---------------------

The  following  is  a summary of equipment owned by the Partnership at March 31,
2002.  Remaining  Lease  Term  (Months), as used below, represents the number of
months  remaining from March 31, 2002 under contracted lease terms.  A Remaining
Lease  Term  equal  to  zero  reflects  equipment  held  for  sale  or re-lease.
<TABLE>
<CAPTION>

<S>                                             <C>          <C>
..                                               Remaining
..                                               Lease Term   Equipment
 Equipment Type                                    (Months)  at Cost
----------------------------------------------  -----------  ------------

One McDonnell Douglas MD-82                               0  $ 2,078,640
One McDonnell Douglas MD-82
(Aerovias de Mexico S.A. de C.V)                         29    2,078,640
One Boeing 737-2H4 (Air Slovakia)                         5      639,834
                                                             ------------
   Total equipment cost                                   -    4,797,114
   Accumulated depreciation                               -   (2,650,672)
                                                             ------------
   Equipment, net of accumulated depreciation             -  $ 2,146,442
                                                             ============
</TABLE>


The  costs  of  each  of  the  Partnership's  aircraft  represent  proportionate
ownership  interests.  The  remaining  interests  are  owned by other affiliated
partnerships  sponsored  by  EFG.  All  partnerships  individually  report,  in
proportion  to  their respective ownership interests, their respective shares of
assets,  liabilities,  revenues,  and  expenses  associated  with  the aircraft.

Certain of the Partnership's aircraft and the related lease payment streams were
used  to  secure  the  Partnership's  term  loans with third-party lenders.  The
preceding  summary  includes  leveraged  equipment  having  an  original cost of
approximately  $2,079,000  and  a  net book value of approximately $1,078,000 at
March  31,  2002.

The  Partnership entered into a three-year lease agreement with Air Slovakia for
its  proportionate  interest  in  a Boeing 737-2H4 aircraft, effective September
2000.  In  accordance with a lease amendment executed in January 2002, the lease
term  was  revised  and  the  lease  will  terminate  in August 2002.  The total
payments  due  under  the amended lease approximate the total payments remaining
under  the  original  lease.

The  summary  above includes aircraft held for re-lease or sale with an original
proportionate  cost  of  approximately  $2,079,000  and  a  net  book  value  of
approximately  $907,000,  which  represents the McDonnell Douglas MD-82 aircraft
returned  in  April  2001.  The  General Partner is actively seeking the sale or
re-lease  of  this  aircraft.


NOTE  4  -  LOAN  RECEIVABLE
----------------------------

On  March  8,  2000,  the  Partnership  and  10  affiliated  partnerships  (the
''Partnerships'')  collectively  loaned  $32  million  to  Echelon  Residential
Holdings  LLC  ("Echelon  Residential  Holdings"),  a  newly  formed real estate
company.  Echelon  Residential Holdings is owned by several investors, including
James  A.  Coyne,  Executive  Vice  President  of  EFG.  In  addition,  certain
affiliates  of the General Partner made loans to Echelon Residential Holdings in
their  individual  capacities.
The  Partnership's  original  loan was $3,640,000. Echelon Residential Holdings,
through  a  wholly-owned  subsidiary  (Echelon  Residential  LLC), used the loan
proceeds  to  acquire  various  real  estate  assets  from Echelon International
Corporation, an unrelated Florida-based real estate company. The loan has a term
of  30 months, maturing on September 8, 2002, and an annual interest rate of 14%
for  the  first  24  months and 18% for the final 6 months. Interest accrues and
compounds  monthly  and  is  payable  at  maturity.  In  connection  with  the
transaction, Echelon Residential Holdings has pledged a security interest in all
of  its  right, title and interest in and to its membership interests in Echelon
Residential LLC to the Partnerships as collateral.  Echelon Residential Holdings
has  no  material  business  interests  other than those connected with the real
estate  properties  owned  by  Echelon  Residential  LLC.
During  the  second  quarter  of  2001,  the  General  Partner  determined  that
recoverability  of  the  loan  receivable had been impaired and at June 30, 2001
recorded  an  impairment  of  $318,500, reflecting the General Partner's current
assessment  of  the  amount  of  loss  that  is  likely  to  be  incurred by the
Partnership.  In  addition  to  the  write-down  recorded  at June 30, 2001, the
Partnership  reserved  all  accrued  interest  of  $590,772 recorded on the loan
receivable from inception through March 31, 2001 and ceased accruing interest on
its  loan receivable from Echelon Residential Holdings, effective April 1, 2001.
The  summarized unaudited financial information for Echelon Residential Holdings
as  of  and  for  the  quarters  ended  March  31,  2002 and 2001 is as follows:

<TABLE>
<CAPTION>

                                            2002           2001
                                        -------------  ------------
<S>                                     <C>            <C>
Total assets                            $ 89,635,923   $72,861,183
Total liabilities                       $100,468,976   $76,780,082
Minority interest                       $  1,507,536   $ 1,906,448
Total deficit                           $(12,340,589)  $(5,825,347)

Total revenues                          $  3,559,971   $ 1,063,439
Total expenses, minority interest
  and equity in loss of unconsolidated
  joint venture                         $  5,358,501   $ 3,096,648
Net loss                                $ (1,798,530)  $(2,033,209)
</TABLE>




NOTE  5  -  NET  INVESTMENT  IN  SALES-TYPE  LEASE
--------------------------------------------------

The  Partnership's  net  investment  in a sales-type lease was the result of the
conditional  sale  of  the  Partnership's proportionate interest in a Boeing 737
aircraft executed in October 2000.  The title to the aircraft was to transfer to
Royal  Aviation  Inc.  at the expiration of the lease term in January 2002.  For
the  quarter  ended  March 31, 2001, the Partnership recognized sales-type lease
revenue  of  $3,351  from  this  lease.

In  the fourth quarter of 2001, Royal Aviation Inc. declared bankruptcy and as a
result,  has defaulted on this conditional sales agreement.  The General Partner
is  continuing  to  negotiate  for  the return of the aircraft.  As of March 31,
2002,  the  Partnership  has  written-down  the  remaining  balance  of  the
Partnership's  investment  in the sales-type lease.  The write-down was based on
the  comparison of the net estimated fair value of the Partnership's interest in
the  aircraft and the Partnership's net investment in the sales-type lease.  The
write-down  recorded  in  the  three  months  ended  March 31, 2002 was $17,755.


NOTE  6  -  RELATED  PARTY  TRANSACTIONS
----------------------------------------

All  operating expenses incurred by the Partnership are paid by EFG on behalf of
the  Partnership and EFG is reimbursed at its actual cost for such expenditures.
Fees  and  other  costs  incurred during the three month periods ended March 31,
2002  and  2001,  which  were  paid  or accrued by the Partnership to EFG or its
Affiliates,  are  as  follows:
<TABLE>
<CAPTION>


                                   2002      2001
                                 --------  --------
<S>                              <C>       <C>
Equipment management fees        $  6,046  $ 10,750
Administrative charges             26,283    13,965
Reimbursable operating expenses
   due to third parties            68,631   127,467
                                 --------  --------

          Total                  $100,960  $152,182
                                 ========  ========
</TABLE>


All  rents  and  the  proceeds  from  the sale of equipment are paid directly to
either  EFG  or  to  a  lender.  EFG  temporarily  deposits collected funds in a
separate interest-bearing escrow account prior to remittance to the Partnership.
At March 31, 2002, the Partnership was owed $4,382 by EFG for such funds.  These
funds  were  remitted  to  the  Partnership  in  April  2002.

The  discussion  of  the loan to Echelon Residential Holdings in Note 4 above is
incorporated  herein  by  reference.


NOTE  7  -  NOTE  PAYABLE
-------------------------

The  Partnership  has a note payable outstanding at March 31, 2002 in the amount
of  $984,248.  This  installment  note  is non-recourse and is collateralized by
Partnership's  interest  in  an  aircraft leased to Aerovias de Mexico, S. A. de
C.V.  and  assignment  of the related lease payments.  This indebtedness bears a
fixed interest rate of 7.65%, principal is amortized monthly and the Partnership
has a balloon payment obligation at the expiration of the lease term of $404,138
in  September  2004.


Management  believes  that  the carrying amount of the note payable approximates
fair  value  at  March 31, 2002 based on its experience and understanding of the
market  for  instruments  with  similar  terms.

The  annual  maturities  of  the  note  payable  are  as  follows:
<TABLE>
<CAPTION>

<S>                              <C>    <C>
  For the year ending March 31,   2003  $   228,055
                                  2004      244,702
                                  2005      511,491
                                        -----------
..                                Total  $   984,248
                                        ===========
</TABLE>



NOTE  8  -  LEGAL  PROCEEDINGS
------------------------------

Action  involving  Rosenblum,  et  al.
--------------------------------------

As  described more fully in the Partnership's Annual Report on Form 10-K for the
year  ended December 31, 2001, the Partnership is a Nominal Defendant along with
ten affiliated partnerships (collectively, the "Partnerships") in a Class Action
Lawsuit, Leonard Rosenblum, et al. v. Equis Financial Group Limited Partnership,
         -----------------------------------------------------------------------
et  al.,  the  outcome  of  which  could  significantly  alter the nature of the
-------
Partnership's  organization  and  its  future  business  operations.
------

The  Defendant's  and  Plaintiff's  Counsel  have reached agreement on a Revised
Stipulation  of  Settlement  (the "Revised Settlement").  As part of the Revised
Settlement,  EFG has agreed to buy the loans made by the Partnerships to Echelon
Residential  Holdings  for an aggregate of $32 million plus interest at 7.5% per
annum,  if  they  are not repaid prior to or at their scheduled maturity date of
September  8, 2002.  The Revised Settlement also provides for the liquidation of
the  Partnerships'  assets,  a  cash  distribution  and  the  dissolution of the
Partnerships including the liquidation and dissolution of this Partnership.  The
court held a hearing on March 1, 2002 to consider the Revised Settlement.  After
the  hearing,  the  court  issued  an  order preliminarily approving the Revised
Settlement  and providing for the mailing of notice to the Operating Partnership
Sub-Class  of  a  hearing on June 7, 2002 to determine whether the settlement on
the terms and conditions set forth in the Revised Settlement is fair, reasonable
and  adequate  and  should be finally approved by the court and a final judgment
entered  in  the  matter.

Action  involving  Transmeridian  Airlines
------------------------------------------

As  described more fully in the Partnership's Annual Report on Form 10-K for the
year  ended December 31, 2001, the Partnership and certain affiliated investment
programs  (collectively, the "Plaintiffs), were involved with certain litigation
with  Transmeridian  Airlines  ("Transmeridian"),  and Atkinson & Mullen Travel,
Inc.,  and  Apple  Vacations,  West, Inc., both d/b/a Apple Vacations ("Apple").

As of March 13, 2002, the parties settled all claims involved in these lawsuits.
The  material  terms  of  settlement  provide:  (i)  in  exchange for payment of
$2,100,000  from  Apple  to the Plaintiffs all claims arising from or related to
the  lawsuits  are  dismissed  with  prejudice;  (ii)  the Plaintiffs shall have
Allowed  Claims  against the bankruptcy estate of Transmeridian in the aggregate
amount  of  $2,700,000;  (iii)  the  Plaintiffs  will  be paid $400,000 from the
insurance  proceeds  relating to the aircraft loss; and (iv) each of the parties
will  receive  mutual  releases  of  all  claims  and  counterclaims.

The  Partnership has received and recorded approximately $1,563,000 in the first
quarter  of  2002,  as its share of the $2,100,000 payment.  The Partnership has
not  yet  received  or  recorded  its  share  of the $400,000 from the insurance
proceeds.  In  addition,  the  Partnership  recognized $969,686 as income in the
fourth  quarter  of  2001 that had been held in escrow pending the resolution of
the  litigation.



<PAGE>


                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION



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

Certain  statements in this quarterly report of AIRFUND II International Limited
Partnership  (the  "Partnership")  that  are  not  historical  fact  constitute
"forward-looking  statements"  within  the  meaning  of  the  Private Securities
Litigation  Reform  Act  of  1995  and  are  subject  to  a variety of risks and
uncertainties.  There are a number of factors that could cause actual results to
differ  materially  from  those expressed in any forward-looking statements made
herein.  These factors include, but are not limited to, the outcome of the Class
Action  Lawsuit,  the  remarketing  of  the  Partnership's  aircraft  and  the
performance  of  the  Partnership's  non-aircraft  assets.

The  Investment  Company Act of 1940 (the "1940 Act") places restrictions on the
capital  structure  and  business activities of companies registered thereunder.
The  Partnership  has  active  business  operations  in  the  financial services
industry,  including  equipment  leasing  and  the  loan  to Echelon Residential
Holdings  LLC  ("Echelon Residential Holdings"). The Partnership does not intend
to  engage  in  investment  activities  in  a  manner or to an extent that would
require the Partnership to register as an investment company under the 1940 Act.
However,  it  is possible that the Partnership unintentionally may have engaged,
or  may in the future engage, in an activity or activities that may be construed
to  fall  within the scope of the 1940 Act. The General Partner has been engaged
in  discussions with the staff of the Securities and Exchange Commission ("SEC")
regarding  whether  or  not  the  Partnership  may  be an inadvertent investment
company  as  a  consequence of the above-referenced loan.  In a letter dated May
10,  2001,  the  staff  of  the  SEC informed the general partner that the staff
believes  that  the  Partnership  and  seven  of its affiliated partnerships are
unregistered  investment  companies as defined in Section 3(a)(1)(C) of the 1940
Act.  The  1940  Act,  among  other things, prohibits an unregistered investment
company  from  offering  securities  for  sale  or  engaging  in any business in
interstate  commerce  and,  consequently,  leases  and contracts entered into by
partnerships  that  are  unregistered  investment companies may be voidable. The
General  Partner  has consulted counsel and believes that the Partnership is not
an  investment company. If the Partnership were determined to be an unregistered
investment  company,  its  business  would  be  adversely affected.  The General
Partner  has determined to take action to resolve the Partnership's status under
the  1940  Act  by  means that may include disposing or acquiring certain assets
that  it  might  not  otherwise  dispose  or  acquire.

As  part  of the Revised Settlement, EFG has agreed to buy the loans made by the
Partnerships  to  Echelon  Residential  Holdings for an aggregate of $32 million
plus  interest  at  7.5%  per annum, if they are not repaid prior to or at their
scheduled  maturity  date  of  September  8,  2002.  The Revised Settlement also
provides  for  the  liquidation of the Partnerships' assets, a cash distribution
and  the  dissolution  of  the  Partnerships  including  the  liquidation  and
dissolution  of  this  Partnership. The court held a hearing on March 1, 2002 to
consider  the  Revised Settlement.  After the hearing, the court issued an order
preliminarily  approving the Revised Settlement and providing for the mailing of
notice  to  the  Operating Partnership Sub-Class of a hearing on June 7, 2002 to
determine  whether  the  settlement on the terms and conditions set forth in the
Revised  Settlement  is  fair,  reasonable  and  adequate  and should be finally
approved  by  the  court  and  a  final  judgment  entered  in  the  matter.

While  there  can be no assurance that the Revised Settlement will receive final
Court  approval and be effected, if it is, the assets of the Partnership will be
liquidated  and  the  Partnership dissolved.  The dissolution of the Partnership
may  resolve its status under the 1940 Act. In the absence of a final settlement
approved  by  the  Court, the Defendants intend to defend vigorously against the
claims  asserted  in  the  Class  Action  Lawsuit.


Overview
--------

As  an  equipment  leasing partnership, the Partnership was organized to acquire
and  lease  a  portfolio  of commercial jet aircraft subject to lease agreements
with  third  parties.  During  1990  and  1991,  the  Partnership purchased four
commercial jet aircraft and a proportionate interest in two additional aircraft,
which  were  leased  by  major  carriers,  engaged  in passenger transportation.
Initially, each aircraft generated rental revenue pursuant to primary-term lease
agreements.  Subsequently,  all  of  the  aircraft in the Partnership's original
portfolio  have  been re-leased, renewed, exchanged for other aircraft, or sold.
At  March 31, 2002, the Partnership's equipment portfolio included proportionate
ownership  interests in three aircraft, two of which were on lease at that date.
In April 2001, the lease term for one of these aircraft expired and the aircraft
was  returned  by  the lessee and remains off lease.  The aircraft off lease and
the  remaining  aircraft,  upon  expiration  of  their lease agreements, will be
re-leased  or  sold  depending on prevailing market conditions.  In addition, in
2000  the  Partnership  entered  into conditional sales agreement related to its
interest in an aircraft and defaulted on the sale in 2001, see discussion below.

Presently, the Partnership is a Nominal Defendant in a Class Action Lawsuit, the
outcome  of  which  could  significantly  alter  the nature of the Partnership's
organization  and  its  future business operations.  Pursuant to the Amended and
Restated  Agreement  and  Certificate  of  Limited  Partnership  (the  "Restated
Agreement,  as  amended"),  the  Partnership  is  scheduled  to  be dissolved by
December  31,  2005.


Critical  Accounting  Policies  and  Estimates
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The preparation of financial statements in conformity with accounting principles
generally  accepted  in  the  United States requires the General Partner to make
estimates  and  assumptions  that  affect  the amounts reported in the financial
statements.  On a regular basis, the General Partner reviews these estimates and
assumptions  including  those  related  to  revenue recognition, asset lives and
depreciation,  allowance  for  doubtful  accounts,  allowance  for  loan  loss,
impairment of long-lived assets and contingencies.  These estimates are based on
the  General  Partner's  historical  experience and on various other assumptions
believed  to  be  reasonable under the circumstances.  Actual results may differ
from  these  estimates  under  different assumptions or conditions.  The General
Partner  believes,  however,  that  the  estimates,  including  those  for  the
above-listed  items,  are  reasonable.

The  General  Partner believes the following critical accounting policies, among
others,  are  subject  to  significant  judgments  and  estimates  used  in  the
preparation  of  these  financial  statements:

Revenue  Recognition:  Rents are payable to the Partnership monthly or quarterly
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and  no  significant amounts are calculated on factors other than the passage of
time.  The  majority  of the Partnership's leases are accounted for as operating
leases  and  are  noncancellable.  Rents  received  prior to their due dates are
deferred.  Lease  payments  for  the  sales-type  lease  are due monthly and the
related  revenue  is  recognized  by a method which produces a constant periodic
rate  of  return  on  the  outstanding  investment  in  the  lease.

Asset lives and depreciation method: The Partnership's primary business involves
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the  purchase  and  subsequent lease of long-lived equipment.  The Partnership's
depreciation  policy  is  intended  to  allocate  the cost of equipment over the
period  during  which  it  produces  economic  benefit.  The principal period of
economic benefit is considered to correspond to each asset's primary lease term,
which  generally  represents  the  period of greatest revenue potential for each
asset.  Accordingly,  to the extent that an asset is held on primary lease term,
the Partnership depreciates the difference between (i) the cost of the asset and
(ii)  the  estimated  residual  value of the asset on a straight-line basis over
such  term.  For  purposes  of  this policy, estimated residual values represent
estimates  of  equipment values at the date of the primary lease expiration.  To
the  extent that an asset is held beyond its primary lease term, the Partnership
continues  to  depreciate  the  remaining  net  book  value  of  the  asset on a
straight-line  basis  over  the  asset's  remaining  economic  life.

Allowance  for  doubtful  accounts:  The  Partnership  maintains  allowances for
-----------------------------------
doubtful  accounts  for  estimated  losses  resulting  from the inability of the
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lessees  to  make  the  lease  payments  required  under  the  contracted  lease
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agreements.  These  estimates are primarily based on the amount of time that has
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elapsed  since  the  related  payments  were  due  as well as specific knowledge
related  to  the  ability  of the lessees to make the required payments.  If the
financial condition of the Partnership's lessees were to deteriorate, additional
allowances  could  be required that would increase expenses.  Conversely, if the
financial  condition  of  the  lessees  were  to improve or if legal remedies to
collect  past  due  amounts were successful, the allowance for doubtful accounts
could  be  reduced,  thereby  decreasing  expenses.

Allowance  for  loan  losses:  The  Partnership  periodically  evaluates  the
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collectibility  of  its  loan's  contractual  principal  and  interest  and  the
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existence  of  loan  impairment  indicators,  including contemporaneous economic
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conditions,  situations  which  could affect the borrower's ability to repay its
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obligation, the estimated value of the underlying collateral, and other relevant
--
factors.  Real  estate  values  are discounted using a present value methodology
over  the  period  between  the  financial  reporting  date  and  the  estimated
disposition  date  of  each property.  A loan is considered to be impaired when,
based  on  current  information  and events, it is probable that the Partnership
will  be unable to collect all amounts due according to the contractual terms of
the loan agreement, which includes both principal and interest.  A provision for
loan  losses is charged to earnings based on the judgment of the General Partner
of  the  amount  necessary  to maintain the allowance for loan losses at a level
adequate  to  absorb  probable  losses.

Impairment  of  long-lived  assets:  On  a  regular  basis,  the General Partner
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reviews  the  net  carrying  value  of  equipment to determine whether it can be
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recovered  from  undiscounted  future cash flows.  Adjustments to reduce the net
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carrying  value of equipment are recorded in those instances where estimated net
--
realizable  value is considered to be less than net carrying value.  Inherent in
the  Partnership's  estimate  of net realizable values are assumptions regarding
estimated  future  cash  flows.  If these assumptions or estimates change in the
future, the Partnership could be required to record impairment charges for these
assets.

Contingencies  and  litigation:  The Partnership is subject to legal proceedings
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involving  ordinary and routine claims related to its business. In addition, the
Partnership  is  also involved in a class action lawsuit. The ultimate legal and
financial  liability  with  respect  to  such  matters  cannot be estimated with
certainty  and  requires  the  use  of  estimates  in  recording liabilities for
potential litigation settlements.  Estimates for losses from litigation are made
after  consultation  with  outside  counsel.  If  estimates  of potential losses
increase  or  the  related  facts  and  circumstances  change in the future, the
Partnership  may  be  required  to  adjust  amounts  recorded  in  its financial
statements.


Results  of  Operations
-----------------------

For  the three months ended March 31, 2002, the Partnership recognized operating
lease  revenue of $86,195 compared to $155,995 for the same period in 2001.  The
decrease  in  operating lease revenue from 2001 to 2002 resulted from lease term
expirations.  In  the future, operating lease revenue is expected to decline due
to  lease  term  expirations  and  aircraft  sales.

The  Boeing  737-2H4  aircraft,  in  which  the  Partnership  holds an ownership
interest, was re-leased in September 2000 to Air Slovakia BWJ Ltd., with a lease
term  expiring  in  September  2003.  In  January  2002, this lease was amended,
including  revising  the  lease expiration date to August 2002.  The Partnership
recognized operating lease revenue of $12,673 and $29,498 for the quarters ended
March  31,  2002  and  2001,  respectively.

A  McDonnell Douglas MD-82 aircraft, in which the Partnership holds an ownership
interest,  was  re-leased in September 2000 to Aerovias de Mexico, S.A. de C.V.,
with  a lease term expiring in September 2004.  The Partnership recognized lease
revenue  of  73,522  related  to  this  aircraft  during each of the three month
periods  ended  March  31,  2002  and  2001.

A  second  McDonnell-Douglas  MD-82  aircraft,  in which the Partnership holds a
proportionate  interest,  was  leased to Finnair OY though April 2001.  In April
2001,  the lessee returned the aircraft, which the General Partner is attempting
to  remarket.

In  October  2000,  the  Partnership  and  certain  of its affiliates executed a
conditional  sales  agreement  with  Royal  Aviation  Inc.  for  the sale of the
Partnership's  interest  in  a  Boeing 737-2H4 aircraft.  This aircraft had been
stored  in  the  warehouse from January 2000 through the date of the conditional
sale  in  October  2000.  The  title  to  the  aircraft was to transfer to Royal
Aviation  Inc.,  at  the  expiration  of the lease term in January 2002.  In the
fourth quarter of 2001, Royal Aviation Inc. declared bankruptcy and as a result,
has  defaulted  on  the  conditional  sales  agreement.  The  General Partner is
negotiating  for  the  return  of  the  aircraft.  As  of  March  31,  2002, the
Partnership  has  written-down  the  remaining  balance  of  the  Partnership's
investment  in the sales-type lease.  The write-down was based on the comparison
of  estimated  fair  value of the Partnership's interest in the aircraft and the
Partnership's  net  investment in the sales-type lease.  The write-down recorded
in  the  three  months  ended  March 31, 2002 was $17,755.  For the three months
ended  March  31,  2001,  the Partnership recognized sales-type lease revenue of
$3,351.

The  Partnership's  aircraft  interests  represent  proportionate  ownership
interests.  In  such  cases,  the remaining interests are owned by an affiliated
equipment leasing program sponsored by Equis Financial Group Limited Partnership
("EFG").  The  Partnership and each affiliate individually report, in proportion
to  their  respective  ownership  interests,  their respective shares of assets,
liabilities,  revenues,  and  expenses  associated  with  the  aircraft.

Interest  income  for the three months ended March 31, 2002 was $18,651 compared
to $174,807 for the same period in 2001.  Interest income is typically generated
from  temporary  investment  of  rental  receipts and equipment sale proceeds in
short-term  instruments  and interest earned on the loan receivable from Echelon
Residential  Holdings.  The  amount  of  future  interest  income is expected to
fluctuate  as  a  result  of  changing  interest  rates  and  the amount of cash
available  for  investment,  among  other  factors.

Interest  income  included  $144,686  for the three months ended March 31, 2001,
earned  on  the  loan  receivable  from  Echelon  Residential  Holdings.  The
Partnership ceased accruing interest on this loan, effective April 1, 2001.  See
further  discussion  below.

In  the  fourth  quarter  of  2001, a court judgment was entered in favor of the
Partnership  and certain affiliates related to the litigation with Transmeridian
Airlines.  The  Partnership  received  settlement  proceeds  of  approximately
$1,563,000  from  the  defendants  in  March 2002, which was recognized as other
income  in  the  first  quarter  of  2002.

The  ultimate  realization of residual value for the Partnership's aircraft will
be dependent upon many factors, including EFG's ability to sell and re-lease the
aircraft.  Changing  market conditions, industry trends, technological advances,
and many other events can converge to enhance or detract from aircraft values at
any  given time.  EFG attempts to monitor these changes and the airline industry
in  general  in order to identify opportunities which may be advantageous to the
Partnership  and  which  will  maximize  total  cash  returns for each aircraft.

The  total  economic  value  realized upon final disposition of each aircraft is
comprised  of  all  primary  lease  term  revenue  generated from that aircraft,
together with its residual value.  The latter consists of cash proceeds realized
upon  the  aircraft's  sale in addition to all other cash receipts obtained from
renting  the  aircraft  on  a  re-lease,  renewal  or  month-to-month  basis.
Consequently,  the  amount  of any future gain or loss reported in the financial
statements  may  not  necessarily  be indicative of the total residual value the
Partnership  achieved  from  leasing  the  aircraft.

For  the  three  months  ended March 31, 2002 and 2001, the Partnership incurred
interest  expense of $19,178 and $17,393, respectively.  In the future, interest
expense  will  decline  as  the principal balance of the note payable is reduced
through  the  application  of  rent  receipts  to  the  outstanding  debt.

Management  fees were $6,046 and $10,750, respectively, during the periods ended
March 31, 2002 and 2001.  Management fees are based on 5% of gross lease revenue
generated  by  leases  and  2% of gross revenue generated by full payout leases.

Bad  debt expense was $22,999 for the quarter ended March 31, 2002 including the
write-down  of  the  remaining  balance  of the Partnership's  investment in the
sales-type  lease.  The write-down was based on the comparison of estimated fair
value  of  the  Partnership's interest in the aircraft and the Partnership's net
investment  in  the  sales-type  lease.

Operating  expenses  were  $94,914 and $141,432 for the three months ended March
31,  2002  and  2001,  respectively.  During  the  quarter ended March 31, 2001,
operating  expenses  included  approximately $27,000 related to the Class Action
Lawsuit.  Other  operating  expenses  consist  principally  of  administrative
charges, professional service costs, such as audit and other legal fees, as well
as  insurance,  printing,  distribution  and  remarketing  expenses.  In certain
cases,  equipment  storage  or  repairs and maintenance costs may be incurred in
connection  with  equipment  being  remarketed.

Depreciation  expense  was  $65,345  for  the  three months ended March 31, 2002
compared  to  $65,346  for  the  same  period  in  2001.

Liquidity  and  Capital  Resources  and  Discussion  of  Cash  Flows
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The  Partnership  by  its  nature  is  a limited life entity.  The Partnership's
principal  operating  activities  derive  from  aircraft  rental  transactions.
Accordingly,  the  Partnership's  principal  source  of  cash from operations is
provided  by  the  collection of periodic rents.  These cash inflows are used to
satisfy  debt  service  obligations associated with leveraged leases, and to pay
management  fees and operating costs.  Operating activities generated a net cash
inflow  of  $1,391,003  and  a  net cash outflow of $20,832 for the three months
ended  March  31,  2002  and  2001,  respectively.  The  cash  inflow in 2002 is
primarily  the  result  of the receipt of approximately $1,563,000 of litigation
settlement  proceeds.  Overall, expenses associated with rental activities, such
as  management fees, and net cash flow from operating activities will decline as
the  Partnership  remarkets its aircraft. The Partnership, however, may continue
to  incur  significant  costs  to  facilitate  the successful remarketing of its
aircraft  in  the  future.  Ultimately,  the  Partnership  will  dispose  of all
aircraft  under  lease.  This  will  occur principally through sale transactions
whereby  each  aircraft will be sold to the existing lessee or to a third party.
Generally,  this  will  occur  upon  expiration  of  each  aircraft's primary or
renewal/re-lease  term.  In  the future, the amount of cash from interest income
is expected to fluctuate as a result of changing interest rates and the level of
cash  available  for  investment,  among  other  factors.  The  loan  to Echelon
Residential Holdings and accrued interest thereon are due in full at maturity on
September  8,  2002.

At  March  31,  2002,  the  Partnership  was  due aggregate future minimum lease
payments  of  $766,487 from contractual operating lease agreements, a portion of
which  will  be  used  to  amortize  the  principal  balance of notes payable of
$984,248.  At  the  expiration  of  the  individual  lease  term  underlying the
Partnership's  future  minimum  lease  payments,  the  Partnership will sell the
aircraft  or  enter  into  a  re-lease  or  renewal agreement when considered by
advantageous  by  the  General Partner or EFG.  In addition, the General Partner
and  EFG currently are attempting to remarket the aircraft that is currently off
lease.  Such remarketing activities will result in the realization of additional
cash  inflows  in the form of sale proceeds or rents from renewals or re-leases,
the  timing  and  extent  of  which cannot be predicted with certainty.  This is
because  the timing and extent of remarketing events often is dependent upon the
needs  and  interests of the existing lessees.  Some lessees may choose to renew
their  lease  contracts,  while others may elect to return the aircraft.  In the
latter instances, the aircraft could be re-leased to another lessee or sold to a
third party.  In accordance with the Partnership's investment objectives and the
terms  of  its  Partnership  Agreement,  the  Partnership  generally  sells  its
aircraft  as the related leases expire. Additionally, the Partnership sells, on
a  selective  basis,  aircraft  before  the  expiration  of  the related lease.

The  loan  made  by the Partnership to Echelon Residential Holdings is, and will
continue  to  be,  subject  to  various  risks, including the risk of default by
Echelon  Residential  Holdings, which could require the Partnership to foreclose
under  the  pledge  agreement  on  its interests in Echelon Residential LLC. The
ability of Echelon Residential Holdings to make loan payments and the amount the
Partnership  may  realize  after  a  default  would  be dependent upon the risks
generally  associated  with  the real estate lending business including, without
limitation,  the existence of senior financing or other liens on the properties,
general  or  local economic conditions, property values, the sale of properties,
interest  rates,  real  estate  taxes,  other operating expenses, the supply and
demand  for  properties involved, zoning and environmental laws and regulations,
rent  control  laws  and  other  governmental  rules.  A  default  by  Echelon
Residential  Holdings  could  have  a material adverse effect on the future cash
flow  and  operating  results  of  the  Partnership.

During  the  second  quarter  of  2001,  the  General  Partner  determined  that
recoverability  of  the  loan  receivable had been impaired and at June 30, 2001
recorded  an  impairment  of  $318,500, reflecting the General Partner's current
assessment  of  the  amount  of  loss  that  is  likely  to  be  incurred by the
Partnership.  In  addition  to  the  write-down  recorded  at June 30, 2001, the
Partnership  reserved  all  accrued  interest  of  $590,772 recorded on the loan
receivable  through  March 31, 2001 and has ceased accruing interest on its loan
receivable  from  Echelon  Residential  Holdings,  effective  April  1,  2001.

The  Restated Agreement, as amended, prohibits the Partnership from making loans
to  the General Partner or its affiliates.  Since the acquisition of the several
parcels  of  real  estate  from the owner had to occur prior to the admission of
certain independent third parties as equity owners, Echelon Residential Holdings
and  its  wholly  owned  subsidiary,  Echelon  Residential  LLC,  were formed in
anticipation  of  their  admission.  The General Partner agreed to an officer of
the Manager serving as the initial equity holder of Echelon Residential Holdings
and  as  an  unpaid  manager of Echelon Residential Holdings. The officer made a
$185,465  equity  investment in Echelon Residential Holdings.  His return on his
equity  investment  is restricted to the same rate of return as the partnerships
realize  on  their  loans.  There  is  a  risk  that the court may object to the
general  partner's  action in structuring the loan in this way since the officer
may be deemed an affiliate and the loans in violation of the prohibition against
loans  to  affiliates  and  the  court's  statement  in its order permitting New
Investments  that  all  other provisions of the Partnership Agreements governing
the  investment  objectives and policies of the Partnership shall remain in full
force  and  effect.  The  court  may  require the partnerships to restructure or
divest  the  loan.  The Partnership periodically evaluates the collectibility of
the  loan's  contractual  principal  and  interest  and  the  existence  of loan
impairment  indicators.

The  Partnership  obtained  long-term  financing  in  connection  with  certain
aircraft.  The origination of such indebtedness and the subsequent repayments of
principal are reported as components of financing activities in the accompanying
Statement  of  Cash  Flows.  The  Partnership's  outstanding  loan  agreement is
recourse  only  to  the  specific  aircraft  financed  and to the minimum rental
payments  contracted  to  be received during the debt amortization period (which
coincides  with the lease term).  As rental payments are collected, a portion or
all of the rental payment is used to repay associated indebtedness.  In the near
term,  the  amount  of  cash  used for debt payments will be consistent with the
quarter  ended  March  31,  2002.  Subsequently,  the  amount  of cash used will
decrease  as  the  principal  balance of the note payable is reduced through the
collection and application of rents.  In addition, the Partnership has a balloon
payment  obligation  as  discussed  below.

In  February  2001, the Partnership's and certain affiliated investment programs
collectively,  (the  "Programs")  refinanced  the  outstanding  indebtedness and
accrued interest related to the aircraft on lease to Aerovias de Mexico, S.A. de
C.V.  In  addition  to refinancing the Programs' total existing indebtedness and
accrued  interest  of $4,758,845, the Programs received additional debt proceeds
of  $3,400,177.  The  Partnership's  aggregate  share  of the refinanced and new
indebtedness  was  $1,211,860  including  $706,831  used  to  repay the existing
indebtedness  on the refinanced aircraft.  The Partnership used a portion of its
share of the additional proceeds of $505,028 to repay the outstanding balance of
the  indebtedness  and  accrued interest related to another aircraft of $130,852
and  certain  aircraft reconfiguration costs that the Partnership had accrued at
December  31,  2000.  The new indebtedness bears a fixed interest rate of 7.65%,
principal  is  amortized  monthly  and  the  Partnership  has  a balloon payment
obligation  at  the  expiration of the lease term of $404,138 in September 2004.

There  are no formal restrictions under the Restated Agreement, as amended, that
materially  limit  the  Partnership's  ability to pay cash distributions, except
that  the General Partner may suspend or limit cash distributions to ensure that
the  Partnership  maintains  sufficient working capital reserves to cover, among
other  things, operating costs and potential expenditures, such as refurbishment
costs  to  remarket  aircraft upon lease expiration. In addition to the need for
funds  in  connection  with  the  Class  Action Lawsuit, liquidity is especially
important  as  the Partnership matures and sells aircraft, because the remaining
aircraft portfolio consists of fewer revenue-producing assets that are available
to  cover  prospective cash disbursements.  Insufficient liquidity could inhibit
the  Partnership's ability to sustain its operations or maximize the realization
of  proceeds  from  remarketing  its  remaining  aircraft.

The  management  and  remarketing  of  aircraft can involve, among other things,
significant  costs  and  lengthy  remarketing  initiatives.  Although  the
Partnership's lessees are required to maintain the aircraft during the period of
lease  contract,  repair,  maintenance,  and/or  refurbishment  costs  at  lease
expiration can be substantial.  For example, an aircraft that is returned to the
Partnership  meeting  minimum  airworthiness  standards, such as flight hours or
engine  cycles,  nonetheless may require heavy maintenance in order to bring its
engines,  airframe  and  other  hardware  up  to  standards that will permit its
prospective  use  in  commercial  air  transportation.

At  March  31,  2002,  the  Partnership's equipment portfolio included ownership
interests  in  three  commercial  jet  aircraft,  one  of  which is a Boeing 737
aircraft.  The  Boeing  737  aircraft  is a Stage 2 aircraft, meaning that it is
prohibited  from  operating  in the United States unless it is retro-fitted with
hush-kits  to meet Stage 3 noise regulations promulgated by the Federal Aviation
Administration.  During  2000,  the  aircraft was re-leased to Air Slovakia BWJ,
Ltd. through September 2003.  In January 2002, this lease was amended, including
revising  the  lease expiration date to August 2002.  The remaining two aircraft
in  the  Partnership's  portfolio already are Stage 3 compliant.  The lease term
associated  with one of the McDonnell Douglas MD-82 aircraft expired in 2001 and
the  aircraft  is  currently  off  lease.

Recent  changes in the economic condition of the airline industry have adversely
affected  the  demand  for and market values for commercial jet aircraft.  These
changes  could  adversely  affect  the  operations  of  the  Partnership and the
residual value of its commercial jet aircraft.  Currently, all of the commercial
jet aircraft in which the Partnership has a proportionate ownership interest are
subject  to  contracted  lease  agreements  except  one  McDonnell Douglas MD-82
aircraft, which was returned to the General Partner upon its lease expiration in
April  2001.  The  General  Partner  is  attempting  to  remarket this aircraft.

In  any  given  year,  it  is  possible that Recognized Owners will be allocated
taxable  income  in  excess  of  distributed cash.  This discrepancy between tax
obligations  and  cash  distributions may or may not continue in the future, and
cash  may  or  may  not  be  available for distribution to the Recognized Owners
adequate  to  cover  any  tax  obligation.

The  Partnership's  capital  account  balances  for  federal  income tax and for
financial reporting purposes are different primarily due to differing treatments
of  income  and expense items for income tax purposes in comparison to financial
reporting  purposes  (generally referred to as permanent or timing differences).
For instance, selling commissions and organization and offering costs pertaining
to syndication of the Partnership's limited partnership units are not deductible
for  federal  income  tax purposes, but are recorded as a reduction of partners'
capital  for  financial  reporting  purposes.  Therefore,  such  differences are
permanent  differences  between  capital  accounts  for  financial reporting and
federal  income  tax  purposes.  Other  differences between the bases of capital
accounts  for  federal  income tax and financial reporting purposes occur due to
timing  differences  consisting  of  the cumulative difference between income or
loss  for  tax  purposes  and financial statement income or loss.  The principal
component  of  the  cumulative  difference between financial statement income or
loss  and  tax  income  or loss results from different depreciation policies for
book  and  tax  purposes.

For  financial reporting purposes, the General Partner has accumulated a capital
deficit  at  March 31, 2002.  This is the result of aggregate cash distributions
to the General Partner being in excess of its capital contribution of $1,000 and
its  allocation  of  financial  statement  net  income or loss.  Ultimately, the
existence  of  a capital deficit for the General Partner for financial reporting
purposes is not indicative of any further capital obligations to the Partnership
by  the General Partner.  The Restated Agreement, as amended, requires that upon
the  dissolution  of  the  Partnership,  the General Partner will be required to
contribute to the Partnership an amount equal to any negative balance, which may
exist  in  the General Partner's tax capital account.  At December 31, 2001, the
General  Partner  had  a  positive  tax  capital  account  balance.

The  Partnership  is  a Nominal Defendant in a Class Action Lawsuit. The General
Partner  will  continue  to  suspend the payment of quarterly cash distributions
pending  final resolution of the Class Action Lawsuit.  Accordingly, future cash
distributions  are  not  expected  to  be paid until the Class Action Lawsuit is
settled  or  adjudicated.


Item  3.  Quantitative  and  Qualitative  Disclosures  about  Market  Risk
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The  Partnership's  financial  statements include financial instruments that are
exposed  to  interest  rate  risks.

The  Partnership has one note payable outstanding at March 31, 2002, which bears
a  fixed  interest  rate of 7.65%.  The fair market value of fixed interest rate
debt  may be adversely impacted due to a decrease in interest rates.  The effect
of  interest rate fluctuations on the Partnership during the quarter ended March
31,  2002  was  not  material.

The  Partnership's  loan to Echelon Residential Holdings matures on September 8,
2002  and  currently  earns interest at a fixed annual rate of 18% with interest
due  at  maturity  (see  discussion above).  Investments earning a fixed rate of
interest  may  have  their fair market value adversely impacted due to a rise in
interest  rates.  The effect of interest rate fluctuations on the Partnership in
the  quarter  ended  March  31,  2002  was  not  material.

<PAGE>


                  AIRFUND II INTERNATIONAL LIMITED PARTNERSHIP

                                    FORM 10-Q

                           PART II. OTHER INFORMATION

<TABLE>
<CAPTION>



<S>           <C>

  Item 1.     Legal Proceedings
  .           Response:

  .           Refer to Note 8 to the financial statements herein.

  Item 2.     Changes in Securities
  .           Response:  None

  Item 3.     Defaults upon Senior Securities
  .           Response:  None

  Item 4.     Submission of Matters to a Vote of Security Holders
  .           Response:  None

  Item 5.     Other Information
  .           Response:  None

  Item 6(a).  Exhibits
  .           Response:  None

  Item 6(b).  Reports on Form 8-K
  .           Response:  None
</TABLE>




<PAGE>


                                 SIGNATURE PAGE




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.



                  AIRFUND II International Limited Partnership


By:        AFG  Aircraft  Management  Corporation,  a
             Massachusetts  corporation  and  the  General
             Partner  of  the  Registrant.


By:        /s/  Michael  J.  Butterfield
            ----------------------------
             Michael  J.  Butterfield
             Treasurer  of  AFG  Aircraft  Management  Corporation
             (Duly  Authorized  Officer  and
             Principal  Financial  and  Accounting  Officer)


Date:     May  14,  2002
          --------------



























<PAGE>

                                 SIGNATURE PAGE


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.



                  AIRFUND II International Limited Partnership


     By:     AFG  Aircraft  Management  Corporation,  a
          Massachusetts  corporation  and  the  General
          Partner  of  the  Registrant.


     By:
          Michael  J.  Butterfield
          Treasurer  of  AFG  Aircraft  Management  Corporation
          (Duly  Authorized  Officer  and
          Principal  Financial  and  Accounting  Officer)


     Date: