**Form 10-Q**

















**Associated Estates Realty Corporation**



|Ohio                                     | 34-1747603            
|---------------------------------------- | ----------------------
|(State or other jurisdiction of          | (I.R.S. Employer      
|incorporation or organization)           | Identification Number)
|                                         |                       
|                                         |                       
|5025 Swetland Court, Richmond Hts., Ohio | 44143-1467            
|(Address of principal executive offices) | (Zip Code)            





|Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
|-----------------------------------------------------------------------------------------------
|Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding                
|12 months (or for such shorter period that the registrant was required                         
|to file such reports), and (2) has been subject to such                                        
|filing requirements for the past 90 days.                                                      
|Yes [ x ]   No [   ]                                                                           







**INDEX**

|**PART I  -  FINANCIAL INFORMATION**  | Page                                                        
|------------------------------------- | ------------------------------------------------------------
|                                      |                                                             
|ITEM 1                                | Condensed Financial Statements                              
|                                      |                                                             
|                                      | Consolidated Balance Sheets as of                           
|                                      | March 31, 2002 and December 31, 2001                        
|                                      |                                                             
|                                      | Consolidated Statements of Operations for the three         
|                                      | month periods ended March 31, 2002 and 2001                 
|                                      |                                                             
|                                      | Consolidated Statement of Shareholders' Equity for the three
|                                      | month period ended March 31, 2002                           
|                                      |                                                             
|                                      | Consolidated Statements of Cash Flows for the three         
|                                      | month periods ended March 31, 2002 and 2001                 
|                                      |                                                             
|                                      | Notes to Financial Statements                               
|                                      |                                                             
|ITEM 2                                | Management's Discussion and Analysis of Financial           
|                                      | Condition and Results of Operations                         
|                                      |                                                             
|ITEM 3                                | Quantitative and Qualitative Disclosure About Market Risk   
|                                      |                                                             
|**PART II**  -  **OTHER INFORMATION** |                                                             
|                                      |                                                             
|ITEM 1                                | Legal Proceedings                                           
|                                      |                                                             
|ITEM 2                                | Changes in Securities                                       
|                                      |                                                             
|ITEM 3                                | Defaults Upon Senior Securities                             
|                                      |                                                             
|ITEM 4                                | Submission of Matters to a Vote of Security Holders         
|                                      |                                                             
|ITEM 5                                | Other Information                                           
|                                      |                                                             
|ITEM 6                                | Exhibits and Reports on Form 8-K                            
|                                      |                                                             
|**SIGNATURES**                        | 27                                                          

**ASSOCIATED ESTATES REALTY CORPORATION**

**CONSOLIDATED BALANCE SHEETS**

**(UNAUDITED)**

|                                                                  |                                      |             
|----------------------------------------------------------------- | ------------------------------------ | ------------
|                                                                  | March 31,                            | December 31,
|                                                                  | 2002                                 | 2001        
|                                                                  | (in thousands, except share amounts)
|**ASSETS**                                                        |                                      |             
|Real estate assets                                                |                                      |             
|Land                                                              | $   91,240                           | $   90,965  
|Buildings and improvements                                        | 794,428                              | 789,775     
|Furniture and fixtures                                            | 33,361                               | 33,091      
|                                                                  | 919,029                              | 913,831     
|Less:  accumulated depreciation                                   | (219,420)                            | (208,039)   
|                                                                  | 699,609                              | 705,792     
|Construction in progress                                          | 11,133                               | 10,287      
|Real estate, net                                                  | 710,742                              | 716,079     
|Properties held for sale                                          | -                                    | 4,105       
|Cash and cash equivalents                                         | 2,675                                | 3,164       
|Restricted cash                                                   | 21,320                               | 22,237      
|Accounts and notes receivable                                     |                                      |             
|Rents                                                             | 1,072                                | 937         
|Affiliates and joint ventures                                     | 7,249                                | 6,195       
|Other                                                             | 3,230                                | 4,188       
|Investments in joint ventures, net                                | 1,885                                | 2,230       
|Intangible and other assets, net                                  | 15,180                               | 15,699      
|                                                                  | $ 763,353                            | $ 774,834   
|**LIABILITIES AND SHAREHOLDERS' EQUITY**                          |                                      |             
|Secured debt                                                      | $ 550,092                            | $ 551,964   
|Unsecured debt                                                    | 105                                  | 105         
|Total indebtedness                                                | 550,197                              | 552,069     
|Accounts payable and accrued expenses                             | 18,688                               | 21,073      
|Dividends payable                                                 | 4,866                                | 4,855       
|Resident security deposits                                        | 3,936                                | 4,161       
|Funds held on behalf of managed properties                        |                                      |             
|Affiliates and joint ventures                                     | 6,309                                | 5,449       
|Other                                                             | 1,094                                | 1,761       
|Accrued interest                                                  | 2,883                                | 2,879       
|Total liabilities                                                 | 587,973                              | 592,247     
|                                                                  |                                      |             
|Operating partnership minority interest                           | 10,591                               | 10,591      
|                                                                  |                                      |             
|Commitments and contingencies                                     | -                                    | -           
|Shareholders' equity                                              |                                      |             
|Preferred shares, Class A cumulative, without par value;          |                                      |             
|3,000,000 authorized; 225,000 issued and outstanding              | 56,250                               | 56,250      
|Common shares, without par value, $.10 stated value; 50,000,000   |                                      |             
|authorized; 22,995,764 issued and 19,465,758 and 19,421,406       |                                      |             
|outstanding at March 31, 2002 and December 31, 2001, respectively | 2,300                                | 2,300       
|Paid-in capital                                                   | 278,721                              | 279,023     
|Accumulated distributions in excess of accumulated net income     | (140,279)                            | (132,844)   
|Accumulated other comprehensive (loss) income                     | (27)                                 | (45)        
|Less: Treasury shares, at cost, 3,530,006 and 3,574,358 shares    |                                      |             
|at March 31, 2002 and December 31, 2001, respectively             | (32,176)                             | (32,688)    
|Total shareholders' equity                                        | 164,789                              | 171,996     
|                                                                  | $ 763,353                            | $ 774,834   





**ASSOCIATED ESTATES REALTY CORPORATION**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**(UNAUDITED)**

|                                                                  | For the three months ended              
|----------------------------------------------------------------- | ----------------------------------------
|                                                                  | March 31,                               
|                                                                  | 2002                                    
|                                                                  | (In thousands, except per share amounts)
|Revenues                                                          |                                         
|Rental                                                            | $ 33,832                                
|Property management fees and reimbursements                       | 5,363                                   
|Asset management fees                                             | 758                                     
|Painting services                                                 | 294                                     
|Other                                                             | 796                                     
|Total revenues                                                    | 41,043                                  
|Expenses                                                          |                                         
|Property operating and maintenance                                | 15,719                                  
|Depreciation and amortization                                     | 8,569                                   
|Direct property management expenses                               | 4,057                                   
|Painting services                                                 | 366                                     
|General and administrative                                        | 3,248                                   
|Interest expense                                                  | 10,147                                  
|Total expenses                                                    | 42,106                                  
|(Loss) income before gain on disposition of properties, equity in |                                         
|net loss of joint ventures and minority interest                  | (1,063)                                 
|Gain on disposition of properties                                 | 255                                     
|Equity in net loss of joint ventures                              | (242)                                   
|Minority interest in operating partnership                        | (116)                                   
|**Net (loss) income**                                             | $  (1,166)                              
|                                                                  |                                         
|**Net (loss) income applicable to common shares**                 | $  (2,537)                              
|                                                                  |                                         
|**Earnings per common share - basic:**                            |                                         
|Net (loss) income applicable to common shares                     | $      (.13)                            
|                                                                  |                                         
|**Earnings per common share - diluted:**                          |                                         
|Net (loss) income applicable to common shares                     | $      (.13)                            
|                                                                  |                                         
|**Dividends declared per common share**                           | $       .25                             
|                                                                  |                                         
|**Weighted average number of common shares outstanding - basic**  | 19,438                                  
|**- diluted**                                                     | 19,438                                  





**ASSOCIATED ESTATES REALTY CORPORATION**

**CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY**

**(UNAUDITED)**

|                                            |           |            |                        |           | Accumulated   |               |           
|------------------------------------------- | --------- | ---------- | ---------------------- | --------- | ------------- | ------------- | ----------
|                                            |           | Class A    |                        |           | Distributions | Accumulated   |           
|                                            |           | Cumulative | Common                 |           | In Excess Of  | Other         | Treasury  
|                                            |           | Preferred  | Shares                 | Paid-In   | Accumulated   | Comprehensive | Shares    
|(In thousands, except share amounts)        | Total     | Shares     | (at $.10 stated value) | Capital   | Net Income    | (Loss) Income | (at cost) 
|                                            |           |            |                        |           |               |               |           
|Balance, December 31, 2001                  | $ 171,996 | $ 56,250   | $ 2,300                | $ 279,023 | $ (132,844)   | $ (45)        | $ (32,688)
|Net (loss) income                           | (1,166)   | -          | -                      | -         | (1,166)       | -             | -         
|Other comprehensive (loss) income:          |           |            |                        |           |               |               |           
|Company's portion of the unrealized (loss)  |           |            |                        |           |               |               |           
|income on a derivative instrument held      |           |            |                        |           |               |               |           
|at a joint venture property                 | 18        | -          | -                      | -         | -             | 18            | -         
|Total comprehensive (loss) income           | (1,148)   | -          | -                      | -         | (1,166)       | 18            | -         
|Issuance of 36,985 restricted common shares |           |            |                        |           |               |               |           
|from treasury shares                        | 368       | -          | -                      | (58)      | -             | -             | 426       
|Deferred compensation                       | (262)     | -          | -                      | (262)     | -             | -             | -         
|Exercise of options on 8,000 shares         |           |            |                        |           |               |               |           
|from treasury shares                        | 77        | -          | -                      | (14)      | -             | -             | 91        
|Issue 252 shares from treasury shares       | 3         | -          | -                      | -         | -             | -             | 3         
|Purchase of 2,587 treasury shares           | (8)       | -          | -                      | -         | -             | -             | (8)       
|Other                                       | -         | -          | -                      | 32        | (32)          | -             | -         
|Common share dividends declared             | (4,866)   | -          | -                      | -         | (4,866)       | -             | -         
|Preferred share dividends declared          | (1,371)   | -          | -                      | -         | (1,371)       | -             | -         
|Balance, March 31, 2002                     | $ 164,789 | $ 56,250   | $ 2,300                | $ 278,721 | $ (140,279)   | $ (27)        | $ (32,176)
|                                            |           |            |                        |           |               |               |           





**ASSOCIATED ESTATES REALTY CORPORATION**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(UNAUDITED)**

|                                                                 | For the three months
|---------------------------------------------------------------- | --------------------
|                                                                 | ended March 31,     
|                                                                 | 2002                
|                                                                 | (In thousands)      
|Cash flow from operating activities:                             |                     
|Net (loss) income                                                | $ (1,166)           
|Adjustments to reconcile net (loss) income to net                |                     
|cash provided by operating activities:                           |                     
|Depreciation and amortization                                    | 8,569               
|Gain on disposition of properties                                | (255)               
|Minority interest in operating partnership                       | 116                 
|Equity in net loss of joint ventures                             | 242                 
|Earnings distributed from joint ventures                         | 122                 
|Net change in assets and liabilities:                            |                     
|- Accounts and notes receivable                                  | 416                 
|- Accounts and notes receivable of affiliates and joint ventures | (647)               
|- Accounts payable and accrued expenses                          | (2,880)             
|- Other operating assets and liabilities                         | 132                 
|- Restricted cash                                                | 942                 
|- Funds held for non-owned managed properties                    | (667)               
|- Funds held for non-owned managed properties of affiliates      |                     
|and joint ventures                                               | 859                 
|Total adjustments                                                | 6,949               
|Net cash flow provided by operations                             | 5,783               
|                                                                 |                     
|Cash flow from investing activities:                             |                     
|Real estate and fixed asset additions acquired or developed      | (2,405)             
|Net proceeds received from sale of properties                    | 3,791               
|Contributions to joint ventures                                  | -                   
|Net cash flow provided by (used for) investing activities        | 1,386               
|Cash flow from financing activities:                             |                     
|Principal payments on secured debt                               | (1,373)             
|Proceeds from secured debt                                       | -                   
|Line of credit borrowings                                        | 3,000               
|Line of credit repayments                                        | (3,500)             
|Common share dividends paid                                      | (4,855)             
|Preferred share dividends paid                                   | (1,371)             
|Treasury shares transactions - net                               | 441                 
|Net cash flow used for financing activities                      | (7,658)             
|(Decrease) increase in cash and cash equivalents                 | (489)               
|Cash and cash equivalents, beginning of period                   | 3,164               
|Cash and cash equivalents, end of period                         | $  2,675            
|                                                                 |                     
|Supplemental disclosure of cash flow information:                |                     
|Dividends declared but not paid                                  | $ 4,866             
|Cash paid for interest (excluding capitalized interest)          | 9,819               





******ASSOCIATED ESTATES REALTY CORPORATION**

**NOTES TO FINANCIAL STATEMENTS**



**1.**	**BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES**

**Business**

Associated Estates Realty Corporation (the "Company") is a self-administered and self-managed
real estate investment trust ("REIT") which specializes in multifamily property management, advisory,
development, acquisition, disposition, operation and ownership activities.  MIG II Realty Advisors, Inc.
("MIG"), an affiliate of the Company, is a registered investment advisor and serves as a real estate advisor
to pension funds.  MIG recognizes revenue primarily from client generated acquisition, disposition and
incentive fees, loan origination, advisory, mortgage servicing, asset and property management and
construction lending activities.  MIG earns the majority of its mortgage servicing fee revenue from two of its
pension fund clients.  Additionally, the Company owns four taxable REIT subsidiaries which provide
management and other services for the Company and third parties. These corporations are referred to
herein as "Service Companies".

The Company's portfolio at March 31, 2002 consisted of a total of 126 properties of which 74 (61
Market Rate properties and 13 Affordable Housing properties) are owned, directly or indirectly, by the
Company or by a subsidiary of the Company; ten properties in which the Company was a joint venture
partner (one Market Rate property 66.67% owned; three Market Rate properties 33.33% owned; two Market
Rate properties 50.0% owned; one Affordable Housing property 50.0% owned; and three Market Rate
properties 49.0% owned) and 42 non-owned properties (one of which is a commercial property) managed
by the Company or one of its subsidiaries.  Additionally, MIG provides asset management services for an
additional seven properties, six of which are commercial properties.

**Basis of Presentation**

The accompanying unaudited financial statements have been prepared by the Company's
management in accordance with generally accepted accounting principles for interim financial information
and applicable rules and regulations of the Securities and Exchange Commission.  Accordingly, they do not
include all of the information and footnotes required by generally accepted accounting principles ("GAAP")
for complete financial statements.  In the opinion of management, all adjustments (consisting only of
normally recurring adjustments) considered necessary for a fair presentation have been included.  The
reported results of operations are not necessarily indicative of the results that may be expected for the full
year.  These financial statements should be read in conjunction with the Company's audited financial
statements and notes thereto included in the Associated Estates Realty Corporation Annual Report on Form
10-K for the year ended December 31, 2001.

**Recent Accounting Pronouncements**

In June 2001, the Financial Accounting Standards Board approved Statements of Financial
Accounting Standards No. 142 "Goodwill and Other Intangible Assets" ("SFAS 142") which became effective
January 1, 2002 for the Company.  Under SFAS 142, amortization of goodwill, including goodwill recorded
in past business combinations, has been discontinued effective with the adoption of this standard, January
1, 2002.  All goodwill and intangible assets will be tested for impairment in accordance with the provisions
of SFAS 142 upon adoption and at March 31, 2002, there was no impact of the impairment test on the
Company's financial position, results of operations and cash flows.  As a result of the discontinuation of the
amortization of goodwill, the Company recognized a reduction in amortization expense of approximately
$147,000 for the three months ended March 31, 2002 compared to the three months ended March 31, 2001.

In August 2001, the FASB issued SFAS No. 143 "Accounting for Asset Retirement Obligations"
which addresses financial accounting and reporting for obligations associated with the retirement of tangible
long-lived assets and the associated asset retirement costs.  This Statement requires that the fair value of
a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable
estimate of the fair value can be made.  The associated asset retirement costs are capitalized as part of the
carrying amount of the long-lived asset.  This Statement will be effective at the beginning of 2003.  The
Company is currently assessing, but has not yet determined the impact of SFAS No. 143 on its financial
position or results of operations.

In October 2001, the FASB issued SFAS No. 144 "Accounting for the Impairment or Disposal of
Long-Lived Assets".  This Statement supersedes SFAS No. 121 and requires that long-lived assets that are
to be disposed of by sale be measured at the lower of book value or fair value less costs to sell.  SFAS No.
144 retains the fundamental provisions of SFAS 121 for (a) recognition and measurement of the impairment
of long-lived assets to be held and used, and (b) measurement of long-lived assets to be disposed of by
sale, but broadens the definition of what constitutes a discontinued operation and how the results of a
discontinued operation are to be measured and presented.  The Company has adopted this Statement
effective January 1, 2002, and through March 31, 2002, it has had no impact on the Company's financial
position, results of operations and cash flows.  The property sold in January 2002 was held for sale as of
December 31, 2001, and is therefore excluded from discontinued operations presentation.

In April 2002, the FASB issued SFAS No. 145 "Rescission of FAS Nos. 4, 44, and 64, Amendment
of FAS 13, and Technical Corrections".  This Statement rescinds FASB No. 4, "Reporting Gains and Losses
from Extinguishment of Debt", and an amendment of that Statement, FASB No. 64, "Extinguishments of
Debt Made to Satisfy Sinking-Fund Requirements".  This Statement amends FASB No. 13, "Accounting for
Leases". This Statement also amends other existing authoritative pronouncements to make various
technical corrections, clarify meanings or describe their applicability under changed conditions.  This
statement will be effective for the Company's fiscal year ending December 31, 2003.  With the rescission
of FAS No. 4, the Company will no longer record gains or losses from the early extinguishment of debt as
an extraordinary item but will record them as a component of the Company's operations.

**Property Management**

In accordance with EITF 01-14, "Income Statement Characterization of Reimbursements Received
for 'Out-of-Pocket' Expenses Incurred", effective January 1, 2002, the Company recharacterized as revenues
certain reimbursements received for expenses incurred in connection with the management of properties
for third parties, joint ventures and other affiliates.  Previously, the Company netted reimbursements against
the expenses.  Effective January 1, 2002, the Company is reporting these reimbursements as revenues and
the reimbursed expenditures as direct property management expenses.  The presentation for 2001 has been
recharacterized on the same basis.

**Reclassifications**

Certain reclassifications have been made to the 2001 financial statements to conform to the 2002
presentation.

**2.	DEVELOPMENT OF MULTIFAMILY PROPERTIES**

Construction in progress, including the cost of land, for the development of multifamily properties
was $11.1 million and $10.3 million at March 31, 2002 and December 31, 2001, respectively.  The Company
capitalizes interest costs on funds used in construction, real estate taxes and insurance from the
commencement of development activity through the time the property is available for leasing.  Capitalized
interest, real estate taxes and insurance aggregated approximately $364,000 and $240,000 during the three
month periods ended March 31, 2002 and 2001, respectively.

******3.	SALE OF PROPERTIES**

On January 18, 2002, the Company completed the sale of a property located in Central Ohio.  The
buyer purchased the property for net cash proceeds of $3.8 million which resulted in the Company recording
a gain of $255,000.

**4.	PROPERTIES HELD FOR SALE**

At March 31, 2002, the Company had no properties classified as held for sale.  At December 31,
2001, the Company had contracts to sell one Market Rate property and one Affordable Housing property
which were presented in the Consolidated Balance Sheets as "Properties held for sale".  The Market Rate
property was sold January 18, 2002 (see Note 3 for further information).  The contract on the Affordable
Housing property has been canceled and the property has been reclassified to "Real estate assets" as it is
no longer considered a "Property held for sale", since management does not believe it will be sold within
the next year.  Upon reclassification, the Company recorded the previously unrecognized depreciation of
approximately $49,000.

**5.	DEBT**

**Conventional**

On February 1, 2002, the Company completed the refinancing of $10.9 million of maturing debt.
The new loan requires monthly principal and interest payments through the maturity date of January 1, 2005.
The interest rate is equal to the prime rate or under certain conditions at a rate of LIBOR plus 2.0%.  The
Company is currently paying interest at the prime rate which was 4.75% at March 31, 2002.

In 2000, the Company caused to be obtained a $14.0 million first mortgage loan encumbering a
property owned by a subsidiary.  The loan provided for disbursement in two installments.  The first
installment of $9.8 million was disbursed in September 2000.  The balance of $4.2 million was disbursed
in March 2001.  The loan requires monthly interest-only payments at the rate of 7.76% through October 15,
2002 when payments of principal and interest are required through the maturity date of October 15, 2005.

**Line of Credit**

On March 31, 2002, $3.0 million was outstanding under a $20.0 million secured line of credit.
Borrowings under this line of credit are currently restricted to an amount not to exceed $12.6 million.
Borrowings under this line of credit bear interest at a rate of LIBOR plus 1.5% which was 3.38% at March
31, 2002.  At December 31, 2001, there were $3.5 million of borrowings outstanding under this line of credit.
The Company also has a $12.0 million line of credit which matures December 31, 2002.  Letters of credit
totaling $3.8 million (see Notes 11 and 12 for further information) limit the amount available under this line
of credit to $8.2 million.  There were no borrowings outstanding under this line at March 31, 2002 or at
December 31, 2001.

**6.**	**TRANSACTIONS WITH AFFILIATES AND JOINT VENTURES**

**Management and Other Services**

The Company provides management and other services to (and is reimbursed for certain expenses
incurred on behalf of) certain non-owned properties in which the Company's Chief Executive Officer and/or
other related parties have varying ownership interests.  The entities which own these properties, as well as
other related parties, are referred to as "affiliates".  The Company or one of its subsidiaries or Service
Companies also provides similar services to joint venture properties.

Summarized affiliate and joint venture transaction activity is as follows:

|                                            | Three months ended
|------------------------------------------- | ------------------
|                                            | March 31,         
|(In thousands)                              | 2002              
|                                            |                   
|Property management fee and other           |                   
|miscellaneous service revenues	- affiliates | $ 389             
|- joint ventures                            | 235               
|Painting service revenues	- affiliates      | 85                
|- joint ventures                            | 79                
|Expenses incurred on behalf                 |                   
|of and reimbursed by (1)	- affiliates       | 961               
|- joint ventures                            | 867               
|Interest income 	- affiliates               | 31                
|Interest expense	- affiliates               | (22)              
|- joint ventures                            | (3)               

(1)  *Primarily payroll and employee benefits, reimbursed at cost.*

Property management fees and other miscellaneous receivables due from affiliates and joint venture
properties aggregated $2.0 million and $2.5 million at March 31, 2002 and December 31, 2001, respectively.
Other miscellaneous payables due to affiliates and joint venture properties aggregated zero and $109,000
at March 31, 2002 and December 31, 2001, respectively.

***Advances to Affiliates and Joint Ventures***

In the normal course of business, the Company advances funds on behalf of, or holds funds for the
benefit of, affiliates and joint ventures.  Funds advanced to affiliates and joint ventures aggregated $781,000
and $1.1 million at March 31, 2002, respectively, and $44,000 and $296,000 at December 31, 2001,
respectively.  The Company held funds for the benefit of affiliates and joint ventures in the aggregate amount
of $4.4 million and $1.9 million at March 31, 2002, respectively, and $3.8 million and $1.5 million at
December 31, 2001, respectively.

***Notes Receivable***

At March 31, 2002 and December 31, 2001, two notes of equal amounts were receivable from the
Company's Chief Executive Officer aggregating $3.3 million (included in "Accounts and notes receivables-affiliates and joint ventures").  One of the notes is partially secured by 150,000 of the Company's common
shares; the other note is unsecured.  For the three months ended March 31, 2002 and 2001, the interest
rates charged on these notes were approximately 3.6% and 7.6%, respectively.  The Company recognized
interest income of $31,000 and $66,000 for the three months ended March 31, 2002 and 2001, respectively,
relating to these notes.  On February 27, 2002, the Company's Board of Directors extended the maturity date
for these two notes from May 1, 2002 to May 1, 2005.

******Joint Ventures**

On July 20, 2001, the Company entered into multiple agreements concerning the disposition of five
Market Rate joint venture properties located in Northeast Ohio.  Under the agreements, the Company would
eventually become the 100% fee owner of three of the properties and relinquish its ownership interest in two
of the properties (one property of which the Company is a 66.67% owner).  These transactions were
completed April 19, 2002 (See Note 12 for further information).

**7.	SHARES**

On February 28, 2002, the Company granted 36,985 of restricted shares to executives of the
Company under the annual incentive plan.  These awards were made from the Company's 2001 Equity
Incentive Plan pursuant to which grants are made solely from treasury shares.  The Company's policy on
the reissuance of treasury shares is to account for the issuance on the First-In First-Out method.  At March
31, 2002, the Company held 3,530,006 treasury shares at a cost of $32.2 million.

**8.	EARNINGS PER SHARE**

Earnings per share ("EPS") has been computed pursuant to the provisions of SFAS No. 128. The
following table provides a reconciliation of both the net (loss) income and the number of common shares
used in the computation of basic EPS, which utilizes the weighted average number of common shares
outstanding without regard to dilutive potential common shares, and diluted EPS, which includes all such
shares, as applicable.

|                                                             | For the three months                    
|------------------------------------------------------------ | ----------------------------------------
|                                                             | ended March 31,                         
|                                                             | (In thousands, except per share amounts)
|                                                             | 2002                                    
|**Basic Earnings Per Share:**                                |                                         
|Net (loss) income                                            | $ (1,166)                               
|Less: Preferred share dividends                              | 1,371                                   
|Net (loss) income applicable to common shares                | $ (2,537)                               
|                                                             |                                         
|**Diluted Earnings Per Share:**                              |                                         
|Net (loss) income before income from discontinued operations | $ (1,166)                               
|Less:	Preferred share dividends                              | 1,371                                   
|Net (loss) income applicable to common shares                | $ (2,537)                               
|                                                             |                                         
|**Number of Shares:**                                        |                                         
|Basic-average shares outstanding                             | 19,438                                  
|Diluted-average shares outstanding                           | 19,438                                  
|                                                             |                                         
|**Earnings Per Common Share - Basic:**                       |                                         
|Net (loss) income applicable to common shares                | $     (.13)                             
|                                                             |                                         
|**Earnings Per Common Share - Diluted:**                     |                                         
|Net (loss) income applicable to common shares                | $     (.13)                             

Options to purchase 3.2 million and 3.1 million common shares were outstanding at March 31, 2002
and 2001, respectively.  Approximately 246,000 and 30,000 common share options were excluded from the
dilutive calculation under the treasury stock method as these shares are considered antidilutive due to the
net loss incurred for the three months ended March 31, 2002 and 2001, respectively.

The exchange of operating partnership minority interests into common shares was not included in
the computation of diluted EPS because the Company plans to settle these OP units in cash.

**9.	INTERIM SEGMENT REPORTING**

The Company has four reportable segments: (1) Acquisition/Disposition multifamily properties, (2)
Same Store Market Rate ("Market Rate") multifamily properties, (3) Affordable Housing multifamily
properties, and (4) Management and Service Operations.  The Company has identified these segments
based upon how management makes decisions regarding resource allocation and performance
assessment.  The Acquisition/Disposition properties represent acquired or developed properties which have
not yet reached stabilization (the Company considers a property stabilized when its occupancy rate reaches
93.0% or one year following the purchase or delivery of the final units, whichever occurs first), and properties
that have been sold.  The Market Rate multifamily properties are same store conventional multifamily
residential apartments.  The Affordable Housing properties are multifamily properties for which the rents are
subsidized and certain aspects of the operations are regulated by HUD pursuant to Section 8 of the National
Housing Act of 1937.  The Management and Service Operations provide management and advisory services
to the Acquired, Market Rate and Affordable Housing properties which are owned by the Company, as well
as to clients and properties not owned by the Company.  All of the Company's segments are located in the
United States.

The accounting policies of the reportable segments are the same as those described in the "Basis
of Presentation and Significant Accounting Policies". The Company evaluates the performance of its
reportable segments based on Net Operating Income ("NOI").  NOI is determined by deducting property
operating and maintenance expenses from total revenues for the Acquisition/Disposition, Market Rate and
Affordable Housing segments and deducting service companies' expense, which is included within the
general and administrative expenses in the Consolidated Statements of Operations, direct property
management expenses and painting service expenses from total revenues for the Management and Service
Operations segment.  NOI should not be considered as an alternative to net income (determined in
accordance with GAAP), as an indicator of the Company's financial performance,  cash flow from operating
activities (determined in accordance with GAAP) or as a measure of the Company's liquidity, nor is it
necessarily indicative of sufficient cash flow to fund all of the Company's needs.  Certain other real estate
companies may define NOI in a different manner.

Information on the Company's segments for the three months ended March 31, 2002 and 2001 is
as follows:

|                                              | For the three months ended March 31, 2002
|--------------------------------------------- | -----------------------------------------
|                                              |                                          
|                                              | Acquisition/                             
|(In thousands)                                | Disposition                              
|                                              |                                          
|Total segment revenues                        | $    832                                 
|Elimination of intersegment revenues          | -                                        
|Consolidated revenues                         | 832                                      
|                                              |                                          
|Equity in net (loss) income of joint ventures | (169)                                    
|                                              |                                          
|*NOI                                          | 476                                      
|                                              |                                          
|Total assets                                  | 28,695                                   

|                                     | For the three months ended March 31, 2001
|------------------------------------ | -----------------------------------------
|                                     |                                          
|                                     | Acquisition/                             
|(In thousands)                       | Disposition                              
|                                     |                                          
|Total segment revenues               | $  2,739                                 
|Elimination of intersegment revenues | -                                        
|Consolidated revenues                | 2,739                                    
|                                     |                                          
|Equity in net loss of joint ventures | -                                        
|                                     |                                          
|*NOI                                 | 1,374                                    
|                                     |                                          
|Total assets                         | 55,052                                   

*Intersegment revenues and expenses have been eliminated in the computation of NOI for each of the segments.

A reconciliation of total segment NOI to total consolidated net (loss) income for the three months
ended March 31, 2002 and 2001 is as follows:

|                                           | For the three months ended March 31,
|------------------------------------------ | ------------------------------------
|                                           | 2002                                
|                                           | (In thousands)                      
|Total NOI for reportable segments          | $19,351                             
|Depreciation and amortization              | (8,569)                             
|General and administrative expense         |                                     
|(excluding service companies' expense)     | (1,698)                             
|Interest expense                           | (10,147)                            
|Gain on disposition of properties          | 255                                 
|Equity in net loss of joint ventures       | (242)                               
|Minority interest in operating partnership | (116)                               
|Consolidated net (loss) income             | $ (1,166)                           

******10.	CONTINGENCIES**

On August 10, 2001, Fluor Daniel, Inc. ("FDI") filed a Demand For Arbitration with the American
Arbitration Association ("AAA") arising out of construction services provided by FDI to MIG/Orlando
Development, LTD ("MOD"), an affiliate of the Company, pursuant to a construction contract between FDI
and MOD for the construction of a 460 suite apartment community located in Orlando, Florida.  FDI claims
that it suffered damages in performing the work because of the owner's breach of the construction contract.
FDI has not specified the amount of its damages, which it claims is yet to be determined; however, the
Company believes that its claim may exceed $3.0 million based on certain information which the Company
has obtained.  Both MOD and the Company are named as party defendants in this litigation.  MOD and the
Company have filed a counterclaim with the AAA against FDI seeking liquidated damages of $1.9 million
arising out of FDI's failure to complete the project in a timely manner as required by the terms of the
construction contract.  The MOD acquired this project in 1998 as part of the Company's acquisition of MIG
Realty Advisors from a group that includes persons who are now officers and directors of the Company,
which group could have a material interest adverse to the Company, because of indemnification obligations
owing to the Company in connection with this litigation.  The arbitration proceedings in this matter have been
temporarily stayed pending a renewed mediation effort.  Should such mediation efforts fail, the Company
intends to vigorously defend this claim and pursue its counterclaim, but cannot predict the final outcome of
this dispute.

On August 28, 2001, Helene Fien filed a complaint in the Court of Common Pleas, Cuyahoga
County, Ohio against the Company, its CEO, Jeffrey I. Friedman, AEC Management Company (a
corporation that merged with the Company at the time of the IPO in 1993) and Associated Estates
Corporation (a non-affiliated company).  The complaint alleges fraud, breach of fiduciary duty and
conversion against each of the defendants and a RICO claim against the individual defendant in connection
with various minority interests (5% or less) in pre IPO entities allegedly held by Mrs. Fien's deceased
husband at the time of his death in 1985.  The Complaint demands compensatory damages in the amount
of $10.0 million plus punitive damages, attorneys' fees, interests and costs.  The litigation is in a preliminary
stage.  The Company believes it has meritorious defenses and intends to vigorously defend this claim, but
cannot predict the final outcome of this dispute.

The Company renewed its blanket insurance policy for the period April 1, 2002 through March 31,
2003 at greater cost with less protection.  The Company's lenders may assert concerns over increased risk
exposure brought about by reduced insurance coverage.  At least one lender has already advised the
Company about its concerns over a lack of terrorism insurance coverage.  Accordingly, the potential exists
for disputes between the Company and one or more of its lenders concerning insurance coverage issues.

The Company believes that its insurance coverage is representative of what is commercially available and
reasonably acceptable.

The Company is also subject to other legal proceedings and claims which arise in the ordinary
course of its business.  Although occasional adverse decisions (or settlements) may occur, the Company
believes that the final disposition of any such pending matters will not have a material adverse effect on the
financial position or results of operations of the Company.

**11.	GUARANTIES**

In connection with the refinancing of the Watergate Apartments, a 949 unit multifamily community
located in Euclid, Ohio, in which the Company was a 33.33% joint venture partner at March 31, 2002, the
Company has guaranteed completion of certain improvements totaling approximately $7.0 million.  This
obligation is secured by a $3.5 million letter of credit.  Also, the Company provided a $407,000 performance
bond to the City of Boynton Beach, Florida, which guarantees performance by a Company subsidiary of
certain improvements in connection with the Company's proposed Boynton Beach development.
Furthermore, the Company has guaranteed the payment of a $30.0 million construction loan in connection
with the Idlewylde Apartments Phase II, a 535 unit multifamily community located in Atlanta, Georgia which
is being developed by the Company and its pension fund joint venture partner.  This loan matures December
10, 2003 with two one-year options to extend.  The Company also has guaranty obligations under a
$220,000 letter of credit for purposes of guaranteeing certain equity contributions required by the
construction lender in connection with Berkley Manor, a 252 unit multifamily community located in Cranberry
Township, Pennsylvania, which is being developed by the Company and its joint venture partner.

**12.	SUBSEQUENT EVENTS**

**Dividends Declared and Paid**

On March 25, 2002, the Company declared a dividend of $0.25 per common share which was paid
on May 1, 2002 to shareholders of record on April 15, 2002.

**Joint Venture Transaction**

On April 19, 2002, the Company and its joint venture partners completed the exchange of five
Market Rate joint venture properties located in Northeast Ohio.  Under the terms of the agreement, the
Company became the 100% fee owner of Americana Apartments (738 units), College Towers Apartments
(458 units) and Watergate Apartments (949 units).  The Company relinquished its 66.67% ownership
interest in Gates Mills III (320 units) and its 33.34% ownership interest in Gates Mills Towers (757 units).

**Sale of Property**

On April 24, 2002, the Company completed the sale of the Americana Apartments, a 738 unit
residential community located in Northeast Ohio.  The buyer purchased the property for a contract sales
price of $18.5 million.  The sale resulted in a gain that will be recorded in the quarter ended June 30, 2002.

**Line of Credit**

On April 19, 2002, the Company entered into an Amended and Restated Line of Credit Agreement,
which extended its $12.0 million line of credit from December 31, 2002 to December 31, 2003, and
increased the maximum amount of such facility from $12.0 million to $14.0 million and permits such credit
facility to be utilized as security in derivative transactions.

**ASSOCIATED ESTATES REALTY CORPORATION**

**MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL**

**CONDITION AND RESULTS OF OPERATIONS.**

The following discussion should be read in conjunction with the financial statements and notes
thereto included in Part I, Item 1 of this Report on Form 10-Q.  Historical results and percentage
relationships set forth in the Consolidated Statements of Operations contained in the financial statements,
including trends which might appear, should not be taken as indicative of future operations.  This discussion
may also contain forward-looking statements based on current judgments and current knowledge of
management, which are subject to certain risks, trends and uncertainties that could cause actual results to
vary from those projected.  Accordingly, readers are cautioned not to place undue reliance on forward-looking statements.  These forward-looking statements are intended to be covered by the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.  Investors are cautioned that the
Company's forward-looking statements involve risks and uncertainty, including without limitation the
following:

changes in economic conditions in the markets in which the Company owns properties, including
interest rates, the overall level of economic activity, the availability of consumer credit and
mortgage financing, unemployment rates and other factors;

risks of a lessening of demand for the multifamily units owned or managed by the Company;

competition from other available apartments and change in market rental rates;

increases in property insurance costs;

inability to obtain terror insurance or if obtainable, then at reasonable rates;

changes in government regulations affecting the Affordable Housing properties;

changes in or termination of contracts relating to third party management and advisory business;

inability to renew current HAP contracts at existing rents;

weather and other conditions that might adversely affect operating expenses;

expenditures that cannot be anticipated such as utility rate and usage increases, unanticipated
repairs, additional staffing, and real estate tax valuation reassessments;

changes in market conditions that may limit or prevent the Company from acquiring properties
or selling properties identified for disposition, which may impede the Company's ability to
continue to diversify its portfolio; and

risks of construction, including cost overruns, contractor defaults and contractor delays .

**Liquidity and Capital Resources**

The Company anticipates that it will meet its liquidity requirements for the current year generally
through its net cash provided by operations, secured borrowings (primarily through the use of the Company's
two lines of credit, which had $17.8 million available at March 31, 2002), property sales proceeds and
possible issuance of debt or equity securities.  The Company believes that these sources will be sufficient
to meet operating requirements, capital additions, mortgage amortization payments and the payment of
dividends in accordance with REIT requirements.

On February 1, 2002, the Company completed the refinancing of $10.9 million of maturing debt.
The new loan requires monthly principal and interest payments through the maturity date of January 1, 2005.
The interest rate is equal to the prime rate or, under certain conditions, at a rate of LIBOR plus 2.0%.  The
Company is currently paying interest at the prime rate which was 4.75% at March 31, 2002.  The maturing
loan had an interest rate of 9.61%.  Additionally, during the remainder of 2002 and 2003, approximately $4.2
million and $6.3 million, respectively, of principal amortization payments on secured debt are required.

At March 31, 2002, the Company had $3.0 million outstanding under a $20.0 million secured line
of credit.  This line of credit matures in July 2003.  Borrowings under this line of credit are currently restricted
up to an amount of $12.6 million.   Borrowings under this line of credit bear interest at a rate of LIBOR plus
1.5% or approximately 3.38% at March 31, 2002.  There were $3.5 million of borrowings outstanding under
this line of credit at December 31, 2001.  Additionally, the Company also has a $14.0 million line of credit
which matures December 31, 2003.  The Company's borrowings under this line of credit bear interest at
either the prime rate or LIBOR plus 2.0% at the Borrower's option.  There were no borrowings outstanding
at either March 31, 2002 or December 31, 2001; however, the amount currently available under this line of
credit is limited to $9.2 million because of outstanding letters of credit and a credit risk sublimit relative to
derivative transactions.

The Company has guaranteed completion of certain improvements totaling $7.0 million in
connection with the refinancing of the Watergate Apartments, a 949 unit multifamily community located in
Euclid, Ohio, in which the Company was a 33.33% joint venture partner at March 31, 2002.  This obligation
is secured by a $3.5 million letter of credit.  Also, the Company provided a $407,000 performance bond to
the City of Boynton Beach, Florida, which guarantees performance by a Company subsidiary of certain
improvements in connection with the Company's proposed Boynton Beach development.  Furthermore, the
Company has guaranteed the payment of a $30.0 million construction loan in connection with the Idlewylde
Apartments Phase II, a 535 unit multifamily community located in Atlanta, Georgia which is being developed
by the Company and its pension fund joint venture partner.  This loan matures December 10, 2003 with two
one-year options to extend.  The Company also has guaranty obligations under a $220,000 letter of credit
for purposes of guaranteeing certain equity contributions required by the construction lender in connection
with Berkley Manor, a 252 unit multifamily community located in Cranberry Township, Pennsylvania, which
the Company and its joint venture partner are developing.

**Insurance**

The September 11, 2001 terrorist attack on New York's World Trade Center and its aftermath has
created a number of uncertainties for the Company concerning the management of its insurance risks.  The
Company recently renewed its blanket insurance policy for the period April 1, 2002 to March 31, 2003 at
greater cost with less protection.  The Company is not alone in facing this twin dilemma.  Since September
11, insurance costs have risen dramatically across the industry, many insurers have significantly reduced
their capacity positions and many others have refused to insure against acts of terrorism.

Accordingly, for the current year the Company is facing a 47.0% increase in property insurance
premiums coupled with reduced insurance protection, in particular, for terrorist-related risks.  When the
Company renewed its current property insurance policy, the Company was unable to obtain quotes for
terrorism insurance at any price.  While the Company continues to pursue insurance protection for terrorist-related risks, it appears unlikely that meaningful coverage can be obtained and that whatever limited
coverage becomes available will only be available at exorbitant rates.

Insurance coverage issues are a matter of concern not only for the Company and its shareholders,
but also the Company's lenders, who may assert their own concerns over increased risk exposure brought
about by reduced insurance coverage.  At least one lender has already advised the Company about its
concerns over a lack of terrorism insurance coverage at one of the Company's properties located in
Columbus, Ohio.  Accordingly, the potential exists for disputes between the Company and one or more of
its lenders concerning insurance coverage issues.

While these developments are a matter of continuing concern, the Company believes that such risks
are mitigated by the fact that its property portfolio is primarily comprised of garden apartment communities
located in the Midwest, outside of central business districts and accordingly, should be considered low-probability targets.  Moreover, the Company believes that its current insurance coverage is representative
of what is commercially available and reasonably acceptable in today's often chaotic insurance environment.
The Company also believes that many other companies are facing similar concerns, which will create
impetus for an acceptable resolution.  In addition, legislation is currently pending in Congress that would
have the federal government fill the gap left by the insurance companies by paying the damages resulting
from any future terrorist attack.



**Acquisitions, Dispositions and Development**

Any future multifamily property acquisitions or developments, whether wholly owned or through a
co-investment, would be financed with the most appropriate sources of capital, which may include the
assumption of mortgage indebtedness, bank and other institutional borrowings through the exchange of
properties, undistributed earnings, secured debt financings, or the issuance of shares or units exchangeable
into common shares.

*Dispositions:*  On January 18, 2002, the Company completed the sale of a property located in
Central Ohio.  The buyer purchased the property for net cash proceeds of $3.8 million and the Company
recorded a gain of $255,000.

*Potential Dispositions:*  The Company is strategically marketing five properties.  These five
properties are comprised of two Affordable Housing properties and three Market Rate properties, all of which
are located in Ohio.

*Advisory Dispositions:*  In March 2002, two properties containing a total of 624 units were sold on
behalf of  MIG advisory clients.

*Development:*  For the three months ended March 31, 2002, two joint venture partnerships in which
the Company is a 49.0% partner, completed the construction and commenced leasing 32 units of the
scheduled 252 units at Berkley Manor (140 units were completed during 2001) and 53 units of the scheduled
535 units for Idlewylde-Phase II (80 units were completed during 2001).

The Company is in the process of constructing or planning the construction of an additional 770 units
as follows:

|                                               |                    | Additional | Anticipated
|---------------------------------------------- | ------------------ | ---------- | -----------
|Property                                       | Location           | Units      | Completion 
|Boynton Beach-Land                             | Boynton Beach, FL  | TBD(1)     | TBD(1)     
|Courtney Chase-Land                            | Orlando, FL        | 288        | 2004       
|Berkley Manor (49.0% owned Joint Venture)      | Cranberry Twp., PA | 80(2)      | 2002       
|Idlewylde-Phase II (49.0% owned Joint Venture) | Atlanta, GA        | 402(2)     | 2003       
|                                               |                    | 770        |            

(1)  To be determined

(2)  Represents the number of units still under construction.  Berkley Manor will contain 252 units and Idlewylde-Phase II will

contain 535 units when the construction of these properties are completed.

**Management Contract Cancellation**

During 2002, the Company's management contracts associated with the following properties were
terminated:

|                            |            |                                           | Approximate        | Approximate     
|--------------------------- | ---------- | ----------------------------------------- | ------------------ | ----------------
|Effective                   |            | Management                                | Management         | Annualized Loss 
|Date of                     | Management | Contract                                  | Fees Earned        | of Management   
|Termination                 | Company    | Canceled                                  | Earned During 2002 | Fees During 2002
|                            |            |                                           | (In thousands)    
|**Market Rate Properties:** |            |                                          
|4/19/02                     | AERC       | Gates Mills Towers (33.33% joint venture) | $ 46               | $ 141           
|4/19/02                     | AERC       | Americana (33.33% joint venture)          | 32                 | 89 (1)          
|4/19/02                     | AERC       | Watergate (33.33% joint venture)          | 68                 | 206 (1)         
|4/19/02                     | AERC       | College Towers (50.0% joint venture)      | 29                 | 86 (1)          
|                            |            |                                           |                   
|**Advisory Properties:**    |            |                                           |                   
|3/01/02                     | AERC       | Advised Assets                            | 32                 | 86              
|3/29/02                     | AERC       | Advised Assets                            | 54                 | 163             

(1)  In connection with the April 19, 2002 transaction, the Company became the 100% owner of these

three properties and as such, no longer will report management fee income for them.

Additionally, the Company anticipates that the following management contracts may be canceled
during 2002 primarily because of proposed sales of the underlying properties:

|                         |            |                   | Approximate   
|------------------------ | ---------- | ----------------- | --------------
|                         |            |                   | Management    
|Effective Date           | Management | Management        | Fees Earned   
|of Termination           | Company    | Contract Canceled | During 2002   
|                         |            |                   |               
|**Advisory Properties:** |            |                   | (In thousands)
|Undetermined             | AERC       | Advised Assets    | $ 45          
|Undetermined             | AERC       | Advised Assets    | 27            
|Undetermined             | AERC       | Advised Assets    | 49            
|Undetermined             | AERC       | Advised Assets    | 19            

*Dividends*:  On March 25, 2002, the Company declared a dividend of $0.25 per common share
which was paid on May 1, 2002 to shareholders of record on April  15, 2002.  On February 6, 2002, the
Company declared a dividend of $0.60938 per depository share on the Company's Class A Cumulative
Preferred Shares which was paid on March 15, 2002 to shareholders of record on March 1, 2002.

*Cash Flows:* Significant sources and uses of cash for the three months ended March 31, 2002 and
2001 are summarized as follows, in thousands:

*Cash Sources (Uses):*

|                                      | For the three months
|------------------------------------- | --------------------
|                                      | ended March 31,     
|                                      | 2002                
|                                      |                     
|Net cash from operating activity      | $ 5,783             
|Real estate and fixed asset additions | (2,405)             
|Net proceeds from sales of properties | 3,791               
|Contributions to joint ventures       | -                   
|(Decreases) increases in debt-net     | (1,873)             
|Cash dividends paid                   | (6,226)             
|Treasury share transactions           | 441                 
|Cash (decrease) increase              | $  (489)            

*Cash flow from operating activity:*  Net cash provided by operating activities decreased $1.8 million
from $7.6 million to $5.8 million for the three months ended March 31, 2002 when compared with the three
months ended March 31, 2001.  This decrease was primarily due to the net activity of the following items:

(i)	For the three months ended March 31, 2002, the net loss before the gain on disposition of
properties was $1.4 million compared to a net loss of $588,000 for the three months ended
March 31, 2001, a decline of $833,000. This decline was primarily due to a decrease of $2.4
million in total revenues net of a decrease of $1.6 million in total expenses.  As explained
in greater detail below, the primary reason for the decrease in total revenues was due to a
decrease of $2.0 million in rental revenues from the sale of seven properties in 2001 and
one property in 2002.  The decrease in total expenses was primarily due to a decrease of
$1.2 million in property operating and maintenance expenses attributable to the
aforementioned sales and a decrease of $808,000 in interest expense.

(ii)	For 2002, accounts and notes receivable and accounts and notes receivable of affiliates
and joint ventures decreased $231,000, while for 2001 they decreased $1.2 million.  This
results in an increase of $1.0 million when comparing the two periods.

(iii)	For 2002, accounts payable and accrued expenses decreased $2.9 million, while for 2001
they decreased $1.7 million resulting in a decrease to cash flow provided by operations of
$1.2 million.  The primary reason for this variance relates to the decrease in expenses and
the timing of the payment of liabilities, both of which results in reducing the necessity of
accruals at March 31,  2002 compared to March 31, 2001.

(iv)	For 2002, restricted cash decreased $942,000 while for 2001 restricted cash increased
$252,000 resulting in an increase to funds provided by operations of $1.2 million when
comparing the two periods.  This increase was primarily due to an increase in replacement
reserve deposits in 2001 compared to a slight decrease during 2002 and a decrease of
$441,000 insurance escrow deposits in 2002 compared to a decrease of $125,000 in 2001.

(v)	For 2002, funds held for non-owned managed properties and non-owned managed
properties of affiliates and joint ventures increased $192,000.  For 2001, they increased
$2.4 million.  This results in a decrease of $2.2 million when comparing the two periods.
The primary reason for the decrease was that at March 31, 2001, the Company was holding
funds from the sale of two managed properties which occurred in March 2001.  There was
no like activity in 2002.

Net cash flows provided by investing activities of $1.4 million for the three months ended March 31,
2002 were primarily the net result of $2.4 million used for the development of multifamily real estate, and
other capital expenditures, net of $3.8 million of net proceeds from the sale of one operating property.

Net cash flows used for financing activities of $7.7 million for the three months ended March 31,
2002 were primarily used to pay dividends on the Company's common and preferred shares and to pay
principal payments on secured debt and net borrowings on the Company's line of credit.

***RESULTS OF OPERATIONS***

***Comparison of the quarter ended March 31, 2002 to the quarter ended March 31, 2001*****

In the following discussion of the comparison of the quarter ended March 31, 2002 to the quarter
ended March 31, 2001, Market Rate properties refers to the Same Store Market Rate property portfolio.
Market Rate properties represents 61 wholly owned properties and one property which was 66.67% owned.
Acquired/Disposed properties represents one recently constructed property that has not yet reached
stabilization and properties that have been sold.  Affordable Housing represents 13 properties subject to
HUD regulations.

The Company uses Net Operating Income ("NOI") as a measure of the performance of its
properties.  NOI is determined by deducting property operating and maintenance expenses from revenues
for the Acquisition/Disposition, Market Rate and Affordable Housing segments and deducting service
companies' expense which is included within the general and administrative expense in the Consolidated
Statement of Income, direct property management expenses and painting service expense from total
revenues for the Management and Service Operations segment.  For the three months ended March 31,
2002, NOI was $19.4 million, a decrease of $1.5 million when compared to the NOI of $20.9 million for the
three months ended March 31, 2001.  The NOI for each of the four segments of the Company for the three
months ended March 31, 2002 and 2001 was: Acquisition/Disposition $476,000 and $1.4 million, Market
Rate $17.0 million and $17.1 million, Affordable Housing $1.3 million and $1.2 million and Management and
Service Operations $580,000 and $1.1 million, respectively.  The components of NOI together with an
explanation of the variances are described as follows:

Overall, total revenues decreased $2.4 million or 5.6% and total expenses decreased $1.6 million
or 3.6% when comparing the quarter ended March 31, 2002 to the quarter ended March 31, 2001,
respectively.  Net (loss) income applicable to common shares after deduction for the dividends on the
Company's preferred shares declined $578,000 or 55.3% for the quarter.

*Rental Revenues:* Rental revenues decreased $2.0 million for the quarter.  The
Acquisition/Disposition properties rental revenues decreased $1.9 million primarily due to the sale of seven
properties during 2001 and one property during 2002.  Rental revenues for the Market Rate properties
decreased $195,000 for the quarter.  The average rental rate per unit was $798 for the 2002 quarter
compared to $773 for the 2001 quarter.  During these periods, the physical occupancies were 90.3% for the
2002 quarter compared to 92.3% for the 2001 quarter.

*Other Revenues:*  Other Income decreased $586,000 or 42.5% for the quarter.  The decrease for
the quarter was primarily due to a $363,000 supervisory fee, recorded on the Management and Service
Companies segment, earned in March 2001 upon the sale of a non-owned Affordable Housing property.
It should also be noted that interest income decreased $79,000 when comparing the quarter ended March
31, 2002 to the same period in 2001.

*Property Operating and Maintenance Expenses:*  Property operating and maintenance expenses
decreased $1.2 million for the quarter.  These expenses for the Acquisition/Disposition properties decreased
$1.0 million primarily due to the sale of seven properties during 2001 and one property during 2002.  For
the Market Rate properties, these expenses decreased $92,000.  The decrease was the net of a decrease
in utility expenses and repairs and maintenance and an increase in real estate taxes and insurance expense
and personnel costs.  Utility expenses decreased primarily due to lower gas cost in 2002 compared to 2001
as a result of less usage in 2002 and a lower rate due to executing a rate contract for a majority of Northeast
Ohio properties at the beginning of the winter season.  Repairs and maintenance declined primarily due to
expense controls instituted during the later half of 2001.  The increase in real estate taxes and insurance
was primarily due to higher property insurance premiums which commenced at the beginning of the
premium year April 2001.  Additionally, it should be noted that the property insurance premiums for the new
premium year commencing April 2002 are approximately 47.0% higher than the prior year.  The increase
in personnel costs were primarily due to annual raises and increased benefit costs, primarily health
insurance.  For the Affordable Housing properties, these expenses decreased $71,000 for the quarter,
primarily due to decreased utility costs, principally gas costs which were down due to lower usage and
decreased rates.

*Other Expenses:*  The Company allocates general and administrative expenses to its four segments
as follows: Based on an internal cost analysis, an amount equal to 85.0% of the Management and Service
Companies' revenues is classified as Service Companies' expense ($1.6 million for both quarters 2002 and
2001), the balance of the general and administrative expenses is allocated to the other three segments on
a per unit basis (number of units in the segment divided by the total units in the portfolio).  Since the general
and administrative expenses are allocated as described above, the Company believes that a comparative
analysis of the total expenses is more meaningful than by segments.  General and administrative expenses
decreased $28,000 for the quarter.

Interest expense decreased $808,000 or 7.4% for the quarter.  Interest expense for the
Acquired/Disposed properties decreased $580,000 for the quarter.  Since the Company capitalizes interest
costs on funds used in construction, the related reduction of interest expense is recorded in the
Acquired/Disposed properties segment as this is the segment to which development properties are
classified.   For the quarter ended March 31, 2002, capitalized interest was $124,000 higher than 2001.
Additionally, four of the seven properties sold during 2001 were secured by mortgages, and as such
recorded interest expense.  For the Market Rate properties, interest expense decreased $203,000 for the
quarter, primarily as a result of lower outstanding balances as the majority of the first mortgages secured
by Market Rate properties require monthly principal payments.  For the Affordable Housing properties,
interest expense was approximately the same when comparing the two quarters.

***Equity in net loss of joint ventures*****

For the quarter ended March 31, 2002, the combined equity in net loss of joint ventures decreased
$17,000 when compared to the quarter ended March 31, 2001.  The decrease was primarily due to the
addition of the operations of two properties currently under construction.  The Company is a 49.0% joint
venture partner in both of these properties.  As of March 31, 2002, one of these properties had 172 of 252
units available to lease and the other property had 133 of 535 units available to lease.

The following table presents the historical statements of operations of the Company's beneficial
interest in the operations of the joint ventures for the three months ended March 31, 2002 and 2001.

|                                                 | For the three months
|------------------------------------------------ | --------------------
|                                                 | ended March 31,     
|(In thousands)                                   | 2002                
|                                                 |                     
|Beneficial interests in joint venture operations |                     
|Rental revenue                                   | $  2,144            
|Cost of operations                               | 1,512               
|                                                 | 632                 
|Interest income                                  | 2                   
|Interest expense                                 | (497)               
|Depreciation                                     | (373)               
|Amortization                                     | (6)                 
|Net loss                                         | $    (242)          

**Inflation**

Management's belief is that the effects of inflation would be minimal on the operational performance
of its portfolio primarily due to the high correlation between inflation and housing costs combined with the
short term nature, typically one year, of the leases.  The Company also faces limited exposure to interest
rate fluctuations due to its high proportion of fixed rate financing.

****

**CONTINGENCIES**

For a discussion of contingencies, see Note 10 of the Notes to the Financial Statements presented
in Part I, Item 1 of this report on Form 10-Q.

**HISTORICAL FUNDS FROM OPERATIONS AND DISTRIBUTABLE CASH FLOW**

Industry analysts generally consider Funds From Operations ("FFO") to be an appropriate measure
of the performance of an equity REIT.  The Company defines FFO as the inclusion of all operating results
applicable to common shareholders, both recurring and non-recurring, except those defined as
"extraordinary items" under generally accepted accounting principles ("GAAP"), adjusted for depreciation
on real estate assets,  amortization of intangible assets and gains and losses from the disposition of
properties.  Adjustments for joint ventures are calculated to reflect FFO on the same basis.  FFO does not
represent cash generated from operating activities in accordance with GAAP and is not necessarily
indicative of cash available to fund cash needs and should not be considered an alternative to net income
as an indicator of the Company's operating performance or as an alternative to cash flow as a measure of
liquidity.  Funds Available for Distribution ("FAD") is calculated as FFO less recurring capital expenditures
funded by operations, depreciation on other assets and amortization of deferred financing fees.  The
Company believes that in order to facilitate a clear understanding of the consolidated historical operating
results of the Company, FFO and FAD should be presented in conjunction with net income as presented
in the consolidated financial statements and data included elsewhere in this report.  Certain other real estate
companies may define FFO in a different manner.

FFO and FAD for the three month periods ended March 31, 2002 and 2001 are summarized in the
following table:

|                                                      | For the three months
|----------------------------------------------------- | --------------------
|                                                      | ended March 31,     
|                                                      | 2002                
|                                                      | (In thousands)      
|                                                      |                     
|**Net (loss) income** **applicable to common shares** | $(2,537)            
|                                                      |                     
|Depreciation on real estate assets                    |                     
|Wholly owned properties                               | 7,904               
|Joint venture properties                              | 339                 
|Amortization of intangible assets                     | 142                 
|Gain on sale of properties                            | (255)               
|**Funds From Operations**                             | 5,593               
|                                                      |                     
|Depreciation - other assets                           | 557                 
|Amortization of deferred financing fees               | 330                 
|Fixed asset additions                                 | (1,479)             
|Fixed asset additions - joint venture properties      | (107)               
|**Funds Available for Distribution**                  | $ 4,894             
|                                                      |                     
|**Weighted average shares	- Basic**                   | 19,438              
|**- Diluted**                                         | 19,438              
|                                                      |                     

**ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK**

The Company is exposed to interest rate changes associated with variable rate debt as well as
refinancing risk on our fixed-rate debt.  The Company's involvement with derivative financial instruments
is limited and management does not expect to use such instruments for trading or other speculative
purposes.  The Company occasionally uses derivative instruments to manage their exposure to interest
rates.  See the Company's Form 10-K "Item 7A Qualitative and Quantitative Disclosures About Market  Risk"
for a more complete discussion of our interest rate sensitive assets and liabilities.  As of March 31, 2002,
the fair market value of the Company's debt has decreased approximately $4.7 million or 1.0% primarily as
a result of a slight increase in interest rates since December 31, 2001 and the reduction of debt due to
monthly amortization payments.  There have been no other material changes in the fair value of assets and
liabilities since the date of the Company's Form 10-K.



**ITEM 1.	LEGAL PROCEEDINGS**

Except as provided below, there are no material pending legal proceedings to which the Company
or any of its subsidiaries or service companies is a party or of which any of their properties is subject that
is required to be reported pursuant to Item 103 of Regulation S-K.

On August 10, 2001, Fluor Daniel, Inc. ("FDI") filed a Demand For Arbitration with the American
Arbitration Association ("AAA") arising out of construction services provided by FDI to MIG/Orlando
Development, LTD ("MOD"), an affiliate of the Company, pursuant to a construction contract between FDI
and MOD for the construction of a 460 suite apartment community located in Orlando, Florida.  FDI claims
that it suffered damages in performing the work because of the owner's breach of the construction contract.
FDI has not specified the amount of its damages, which it claims is yet to be determined; however, the
Company believes that its claim may exceed $3.0 million based on certain information which the Company
has obtained.  Both MOD and the Company are named as party defendants in this litigation.  MOD and the
Company have filed a counterclaim with the AAA against FDI seeking liquidated damages of $1.9 million
arising out of FDI's failure to complete the project in a timely manner as required by the terms of the
construction contract.  The MOD acquired this project in 1998 as part of the Company's acquisition of MIG
Realty Advisors from a group that includes persons who are now officers and directors of the Company,
which group could have a material interest adverse to the Company, because of indemnification obligations
owing to the Company in connection with this litigation.  The arbitration proceedings in this matter have been
temporarily stayed pending a renewed mediation effort.

On August 28, 2001, Helene Fien filed a complaint in the Court of Common Pleas, Cuyahoga
County, Ohio against the Company, its CEO, Jeffrey I. Friedman, AEC Management Company (a
corporation that merged with the Company at the time of the IPO in 1993) and Associated Estates
Corporation (a non-affiliated company).  The complaint alleges fraud, breach of fiduciary duty and
conversion against each of the defendants and a RICO claim against the individual defendant in connection
with various minority interests (5% or less) in pre IPO entities allegedly held by Mrs. Fien's deceased
husband at the time of his death in 1985.  The Complaint demands compensatory damages in the amount
of $10.0 million plus punitive damages, attorneys' fees, interests and costs.

******ITEM 2.	CHANGES IN SECURITIES**

****None

**ITEM 3.	DEFAULTS UPON SENIOR SECURITIES**

None

**ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**

None

**ITEM 5.	OTHER INFORMATION**

None

**ITEM 6.	EXHIBITS AND REPORTS ON FORM 8-K**

(a)	Exhibits

|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | **Filed herewith or**                                                            
|---------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | **incorporated**                                                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | **herein by**                                                                    
|**Number** | **Title**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | **reference**                                                                    
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|2.01       | Second Amended and Restated Agreement and Plan of Merger by  and
among the Company, MIG Realty Advisors, Inc.  ("MIGRA")  and the
MIGRA stockholders dated as of March 30, 1998.                                                                                                                                                                                                                                                                                                                                                                      |  | Exhibit 2.01 to Form 8-K filed March 31, 1998.                                   
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|3.1        | Second Amended and Restated Articles of Incorporation of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  | Exhibit 3.1 to Form
S-11 filed June 30,
1994 (File No. 33-80950 as amended)      
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|3.2        | Code of Regulations of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Exhibit 3.2 to Form
S-11 filed June 30,
1994 (File No. 33-80950 as amended).     
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.1        | Specimen Stock Certificate.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | Exhibit 3.1 to Form S-11 filed September 2,
1993 (File No. 33-68276 as amended). 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.2        | Form of Indemnification Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  | Exhibit 4.2 to Form S-11 filed September 2,
1993 (File No. 33-68276 as amended). 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.3        | Promissory Note dated October 23, 1991 from Triangle Properties Limited
Partnership, et. al., in favor of PFL Life Insurance Company; Open End
Mortgage from Triangle Properties Limited Partnership I, et. al., in favor of
PFL Life Insurance Company (The Registrant undertakes to provide
additional long-term loan documents upon request).                                                                                                                                                                                                      |  | Exhibit 4.3 to Form S-11 filed September 2,
1993 (File No. 33-68276 as amended). 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.4        | Promissory Note dated February 28, 1994 in the amount of $25 million.
Open-End Mortgage Deed and Security Agreement from AERC to
National City Bank (Westchester Townhouse); Open-End Mortgage Deed
and Security Agreement from AERC to National City Bank (Bay Club);
Open-End Mortgage Deed and Security Agreement from Winchester II
Apartments, Inc. to National City Bank (Winchester II Apartments); and
Open-End Mortgage Deed and Security Agreement from Portage Towers
Apartments, Inc. to  National City Bank (Portage Towers Apartments). |  | Exhibit 4.4 to Form  10-K filed March 31, 1993.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.5        | Form of Promissory Note and Form of Mortgage and Security Agreement
dated May 10, 1999 from AERC to The Chase Manhattan Bank.                                                                                                                                                                                                                                                                                                                                                                                                                         |  | Exhibit 4.5 to Form 10-Q filed August 13,
1999.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.5a       | Form of Promissory Note and Form of Mortgage and Security Agreement
dated September 10, 1999 from AERC to The Chase Manhattan Bank.                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Exhibit 4.5a to Form
10-Q filed November
12, 1999.                               
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.5b       | Form of Promissory Note and Form of Mortgage and Security Agreement

dated November 18, 1999 from AERC to The Chase Manhattan Bank.                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Exhibit 4.5b to Form
10-K filed March 15,
2000.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.6        | Indenture dated as of March 31, 1995 between Associated Estates Realty
Corporation and National City Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Exhibit 4.6 to Form 10-Q filed May 11, 1995.                                     
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.9        | Form of Medium-Term Note-Fixed Rate-Senior Security.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | Exhibit 4(I) to Form S-3
filed December 7, 1995
(File No. 33-80169) as
amended.  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.10       | Form of Preferred Share Certificate.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | Exhibit 4.1 to Form 8-K
filed July 12, 1995.                                     
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.11       | Form of Deposit Agreement and Depositary Receipt.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | Exhibit 4.2 to Form 8-K
filed July 12, 1995.                                     
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.13       | Amended and Restated Loan Agreement between Associated Estates
Realty Corporation and National City Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | Exhibit 4.13 to Form
10-Q filed November
13, 2001.                               
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|4.14       | Guaranty Agreement dated November 28, 2000 from Associated Estates
Realty Corporation to Southtrust Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | Exhibit 4.14 to Form
10-K filed March 13,
2001.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10         | Associated Estates Realty Corporation Directors' Deferred Compensation
Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | Exhibit 10 to Form 10-Q filed November 14,
1996.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.1       | Registration Rights Agreement among the Company and certain holders
of the Company's Common Shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Exhibit 10.1 to Form S-11 filed September 2,
1993 (File No. 33-68276 as amended).
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.2       | Stock Option Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  | Exhibit 10.2 to Form S-11 filed September 2,
1993 (File No. 33-68276 as amended).
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.3       | Amended and Restated Employment Agreement between the Company
and Jeffrey I. Friedman.                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | Exhibit 10.1 to Form
10-Q filed May 13,
1996.                                    
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.4       | Equity-Based Incentive Compensation Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | Exhibit 10.4 to Form
10-K filed March 29,
1995.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.5       | Long-Term Incentive Compensation Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | Exhibit 10.5 to Form
10-K filed March 29,
1995.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.6       | Lease Agreement dated November 29, 1990 between Royal American
Management Corporation and Airport Partners Limited Partnership.                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Exhibit 10.6 to Form
10-K filed March 29,
1995.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.7       | Sublease dated February 28, 1994 between the Company as Sublessee,
and Progressive Casualty Insurance Company, as Sublessor.                                                                                                                                                                                                                                                                                                                                                                                                                          |  | Exhibit 10.7 to Form
10-K filed March 29,
1995.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.8       | Assignment and Assumption Agreement dated May 17, 1994 between the
Company, as Assignee, and Airport Partners Limited Partnership, as
Assignor.                                                                                                                                                                                                                                                                                                                                                                                                       |  | Exhibit 10.8 to Form
10-K filed March 29,
1995.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.9       | Form of Restricted Agreement dated by and among the Company and Its
Independent Directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Exhibit 10.9 to Form
10-K filed March 28,
1996.                                  
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.10      | Pledge Agreement dated May 23, 1997 between Jeffrey I. Friedman and
the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | Exhibit 10.01 to Form
10-Q filed August 8,
1997.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.11      | Secured Promissory Note dated May 23, 1997 in the amount of
$1,671,000 executed by Jeffrey I. Friedman in favor of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Exhibit 10.02 to Form
10-Q filed August 8,
1997.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.12      | Unsecured Promissory Note dated May 23, 1997 in the amount of
$1,671,000 executed by Jeffrey I. Friedman in favor of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                     |  | Exhibit 10.03 to Form
10-Q filed August 8,
1997.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.13      | Stock Purchase Agreements between the Company and Jeffrey I.
Friedman dated October 25, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | Exhibit 10.13 to Form
10-K filed March 13,
2002.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.14      | Form of Share Option Agreement by and among the Company and Its
Independent Directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | Exhibit 10.14 to Form
10-K filed March 30,
1993.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.15      | Agreement dated March 11, 1999 by and among the Company and The
Milstein Affiliates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | Exhibit 10.15 to Form
10-Q filed May 17,
1999.                                   
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.16      | Agreement dated March 11, 1999 by and among the Company and The
Milstein Affiliates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | Exhibit 10.16 to Form
10-Q filed May 17,
1999.                                   
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.19      | Amended and Restated Confidentiality and Noncompete Agreement
dated January 26, 2000 by and between the Company and James A.
Cote'.                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Exhibit 10.19 to Form
10-K filed March 15,
2000.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.19a     | Consulting Agreement between James A. Cote' and the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | Exhibit 10.19a to Form
10-K filed March 13,
2001.                                
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.20      | Agreement dated October 11, 1999 by and among the Company and
certain of the former holders (the "MIGRA Stockholders") of the issued
and outstanding shares of common stock of MIG Realty Advisors, Inc.
("MIGRA").                                                                                                                                                                                                                                                                                                                                   |  | Exhibit 10.20 to Form
10-K filed March 15,
2000.                                 
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.20a     | Settlement and Release Agreement dated November 30, 2001 by and
among the Company and certain of the former MIGRA Shareholders.                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Exhibit 10.20a to Form
10-K filed March 13,
2002.                                
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.21      | Swap Agreement dated February 16, 2000 by and among the Company
and National City Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  | Exhibit 10.21 to Form
10-Q filed May 10,
2000.                                   
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|10.22      | Year 2000 Equity Incentive Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | Exhibit 10.22 to Form
10-Q filed May 15,
2001.                                   
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  
|18.1       | Letter regarding change in accounting principles.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | Exhibit 18.1 to Form
10-Q filed May 17,
1999.                                    
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                  

(b)	Reports on Form 8-K.

None

**SIGNATURES**

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.

|             | ASSOCIATED ESTATES REALTY CORPORATION
|------------ | -------------------------------------
|             |                                      
|             |                                      
|May 10, 2002 | /s/ Lou Fatica                       
|(Date)       | Lou Fatica, Vice President,          
|             | Chief Financial Officer and Treasurer

**SIGNATURES**

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.



|       | ASSOCIATED ESTATES REALTY CORPORATION              
|------ | ---------------------------------------------------
|       |                                                    
|       |                                                    
|       | Lou Fatica, Vice President, Chief Financial Officer
|(Date) | and Treasurer