<PAGE>
 
                                   FORM 10-Q


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



         [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

                        SECURITIES EXCHANGE ACT OF 1934


               For the quarterly period ended SEPTEMBER 30, 1998


                                      OR

        [   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

                        SECURITIES EXCHANGE ACT OF 1934



                        Commission File Number: 0-24920



                       ERP OPERATING LIMITED PARTNERSHIP
            (Exact Name of Registrant as Specified in Its Charter)



            Illinois                                            36-3894853
(State or Other Jurisdiction of Incorporation                (I.R.S. Employer
          or Organization)                                 Identification No.)


Two North Riverside Plaza, Chicago, Illinois                        60606
 (Address of Principal Executive Offices)                        (Zip Code)

                                (312) 474-1300
             (Registrant's Telephone Number, Including Area Code)



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

                       ERP OPERATING LIMITED PARTNERSHIP
                          CONSOLIDATED BALANCE SHEETS
                            (Amounts in thousands)
                                  (Unaudited)


<TABLE> 
<CAPTION> 
                                                                    September 30,         December 31,
                                                                         1998                 1997
                                                                    -------------         ------------
<S>                                                                 <C>                   <C>
ASSETS                                                               
Investment in real estate                                            
  Land                                                                 $1,108,417           $  791,980
  Depreciable property                                                  7,522,306            6,293,415
  Construction in progress                                                 49,589               36,040
                                                                       ----------           ----------
                                                                        8,680,312            7,121,435
 Accumulated depreciation                                                (640,452)            (444,762)
                                                                       ----------           ----------
   Investment in real estate, net of accumulated depreciation           8,039,860            6,676,673
                                                                     
Real estate held for disposition                                           72,336                   --
Cash and cash equivalents                                                 154,013               33,295
Investment in mortgage notes, net                                          87,937              176,063
Rents receivable                                                            3,978                3,302
Deposits - restricted                                                      50,840               36,374
Escrow deposits - mortgage                                                 63,878               44,864
Deferred financing costs, net                                              23,377               23,092
Other assets                                                              136,388              100,968
                                                                       ----------           ----------
    Total assets                                                       $8,632,607           $7,094,631
                                                                       ==========           ==========
LIABILITIES AND PARTNERS' CAPITAL                                    
Liabilities:                                                         
  Mortgage notes payable                                               $1,960,340           $1,582,559
  Notes, net                                                            1,672,148            1,130,764
  Line of credit                                                          310,000              235,000
  Accounts payable and accrued expenses                                    96,522               67,699
  Accrued interest payable                                                 48,484               28,048
  Rents received in advance and other liabilities                          52,561               38,750
  Security deposits                                                        36,558               28,193
  Distributions payable                                                    90,979               20,223
                                                                       ----------           ----------
    Total liabilities                                                   4,267,592            3,131,236
                                                                       ----------           ----------
                                                                     
Commitments and contingencies                                        
                                                                     
  9 3/8% Series A Cumulative Redeemable Preference Units                  153,000              153,000
                                                                       ----------           ----------
  9 1/8% Series B Cumulative Redeemable Preference Units                  125,000              125,000
                                                                       ----------           ----------
  9 1/8% Series C Cumulative Redeemable Preference Units                  115,000              115,000
                                                                       ----------           ----------
  8.60% Series D Cumulative Redeemable Preference Units                   175,000              175,000
                                                                       ----------           ----------
  Series E Cumulative Convertible Preference Units                         99,925               99,963
                                                                       ----------           ----------
  9.65% Series F Cumulative Redeemable Preference Units                    57,500               57,500
                                                                       ----------           ----------
  7 1/4% Series G Convertible Cumulative Preference Units                 316,250              316,250
                                                                       ----------           ----------
Partners' capital:                                                   
  General Partner                                                       2,938,516            2,648,278
  Limited Partners                                                        384,824              273,404
                                                                       ----------           ----------
    Total partners' capital                                             3,323,340            2,921,682
                                                                       ----------           ----------
    Total liabilities and partners' capital                            $8,632,607           $7,094,631
                                                                       ==========           ==========

</TABLE>
                            See accompanying notes.

                                       2
<PAGE>

                       ERP OPERATING LIMITED PARTNERSHIP
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                (Amounts in thousands, except per OP Unit data)
                                  (Unaudited)

<TABLE> 
<CAPTION> 
                                                     Nine Months Ended September 30, Quarter Ended September 30,
                                                              1998          1997          1998          1997
                                                     ------------------------------- ---------------------------
<S>                                                         <C>           <C>            <C>          <C> 
REVENUES
  Rental income                                             $901,087      $482,980      $329,717       $192,181
  Fee and asset management                                     4,204         4,364         1,414          1,254
  Interest income - investment in mortgage notes              14,405        14,821         4,184          6,810
  Interest and other income                                   12,994         7,513         3,984          3,109
                                                            --------      --------      --------       --------
    Total revenues                                           932,690       509,678       339,299        203,354
                                                            --------      --------      --------       --------
EXPENSES
  Property and maintenance                                   224,457       117,681        86,547         46,921
  Real estate taxes and insurance                             88,552        48,560        32,068         18,893
  Property management                                         38,278        18,765        13,168          6,946
  Fee and asset management                                     3,289         2,523         1,049            954
  Depreciation                                               208,394       106,114        76,484         43,339
  Interest:                                                                                    
    Expense incurred                                         170,143        82,775        64,492         31,851
    Amortization of deferred financing costs                   1,962         1,810           687            590
  General and administrative                                  15,598        10,037         5,327          3,831
                                                            --------      --------      --------       --------
    Total expenses                                           750,673       388,265       279,822        153,325
                                                            --------      --------      --------       --------
Income before gain on disposition of properties              182,017       121,413        59,477         50,029
  Gain on disposition of properties                           12,717         3,923         1,625            291
                                                            --------      --------      --------       --------
Net income                                                  $194,734      $125,336      $ 61,102       $ 50,320
                                                            ========      ========      ========       ======== 

ALLOCATION OF NET INCOME:

9 3/8% Series A Cumulative Redeemable
   Preference Units                                         $ 10,758      $ 10,758      $  3,586       $  3,586
                                                            ========      ========      ========       ======== 
9 1/8% Series B Cumulative Redeemable                                                   
   Preference Units                                         $  8,555      $  8,555      $  2,851       $  2,851
                                                            ========      ========      ========       ======== 
9 1/8% Series C Cumulative Redeemable                                                   
   Preference Units                                         $  7,870      $  7,870      $  2,623       $  2,624
                                                            ========      ========      ========       ======== 
8.60% Series D Cumulative Redeemable                                                    
   Preference Units                                         $ 11,288      $  5,477      $  3,763       $  3,763
                                                            ========      ========      ========       ======== 
Series E Cumulative Convertible                                                         
   Preference Units                                         $  5,246      $  2,365      $  1,749       $  1,750
                                                            ========      ========      ========       ======== 
9.65% Series F Cumulative Redeemable                                                    
   Preference Units                                         $  4,162      $  1,875      $  1,387       $  1,387
                                                            ========      ========      ========       ======== 
7 1/4% Series G Convertible Cumulative                                                  
   Preference Units                                         $ 17,196      $    387      $  5,732       $    387
                                                            ========      ========      ========       ======== 
General Partner                                              116,819        78,618        34,881         30,886
Limited Partners                                              12,840         9,431         4,530          3,086
                                                            --------      --------      --------       --------
Net income available to OP Unit holders                     $129,659      $ 88,049      $ 39,411       $ 33,972
                                                            ========      ========      ========       ======== 
Net income per weighted average OP Unit outstanding         $   1.22      $   1.28      $   0.36       $   0.42
                                                            ========      ========      ========       ======== 
Weighted average OP Units outstanding                        106,630        68,970       109,688         81,134
                                                            ========      ========      ========       ========
Net income per weighted average OP Unit outstanding -
  assuming dilution                                         $   1.21      $   1.26      $   0.36       $   0.41
                                                            ========      ========      ========       ========
</TABLE>                                     
                                          
                                             
                            See accompanying notes.

                                       3
                                             
                                             
                                             
<PAGE>

                       ERP OPERATING LIMITED PARTNERSHIP
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (Amounts in thousands)
                                  (Unaudited)

<TABLE> 
<CAPTION> 
                                                                                           Nine Months Ended September 30,
                                                                                           -------------------------------
                                                                                               1998                1997
                                                                                           -------------------------------
<S>                                                                                        <C>                  <C> 
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                                                                              $   194,734           $ 125,336
  Adjustments to reconcile net income to net cash provided by operating activities:
    Depreciation                                                                              208,394             106,114
    Amortization of deferred financing costs (including discounts and premiums on debt)           457               1,652
    Amortization of discount on investment in mortgage notes                                   (1,900)             (2,480)
    Gain on disposition of properties                                                         (12,717)             (3,923)
    Changes in assets and liabilities:
      (Increase) in rents receivable                                                             (676)               (862)
      (Increase) in deposits - restricted                                                      (7,033)               (736)
      (Increase) in other assets                                                                  (24)             (6,306)
      Increase in accounts payable and accrued expenses                                        29,626              20,890
      Increase in accrued interest payable                                                     20,436               7,756
      Increase in rents received in advance and other liabilities                               8,640               6,901
                                                                                          -----------           ---------
    Net cash provided by operating activities                                                 439,937             254,342
                                                                                          -----------           ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Investment in real estate, net                                                             (947,018)           (630,419)
  Improvements to real estate                                                                 (60,614)            (23,725)
  Additions to non-real estate property                                                        (7,928)             (6,293)
  Proceeds from disposition of real estate                                                     75,976               5,477
  Purchase of management contract rights                                                         (119)             (5,000)
  (Increase) in mortgage deposits                                                             (19,014)            (14,704)
  Deposits on real estate acquisitions                                                         (7,433)             13,911
  Investment in mortgage notes, net                                                             1,842             (86,975)
  Investment in partnerships - development                                                    (21,708)                 --
  Costs related to Mergers                                                                     (4,528)            (60,429)
  Other investing activities                                                                  (18,975)            (57,304)
                                                                                          -----------           ---------
    Net cash (used for) investing activities                                               (1,009,519)           (865,461)
                                                                                          -----------           ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Capital contributions from General Partner, net                                             323,884             950,946
  Distributions paid to partners                                                             (209,638)           (158,292)
  Proceeds from sale of 2015 Notes, net of discount                                           298,125                  --
  Proceeds from sale of August 2003 Notes, net of discount                                     99,650                  --
  Proceeds from sale of 2000 Notes, net of discount                                           144,452                  --
  Proceeds from option to remarket the 2015 Notes                                               8,130                  --
  Principal receipts on employee notes                                                            234                 240
  Proceeds from restructuring of tax-exempt bond investments                                       --               9,350
  Repayments on line of credit                                                               (370,000)           (185,000)
  Proceeds from line of credit                                                                445,000             185,000
  Principal payments on mortgage notes payable                                                (55,711)            (62,993)
  Loan and bond acquisition costs                                                              (2,191)             (1,697)
  Increase in security deposits                                                                 8,365               3,843
                                                                                          -----------           ---------
    Net cash provided by financing activities                                                 690,300             741,397
                                                                                          -----------           ---------
Net increase in cash and cash equivalents                                                     120,718             130,278
Cash and cash equivalents, beginning of period                                                 33,295             147,271
                                                                                          -----------           ---------
Cash and cash equivalents, end of period                                                  $   154,013           $ 277,549
                                                                                          ===========           =========
</TABLE> 

                            See accompanying notes.

                                       4
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP
               CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
                            (Amounts in thousands)
                                  (Unaudited)

<TABLE> 
<CAPTION> 
                                                                           Nine Months Ended September 30,
                                                                           -------------------------------
                                                                             1998                1997
                                                                           -------------------------------
<S>                                                                        <C>                    <C> 
Supplemental information:                                                                   
  Cash paid during the period for interest                                 $149,707               $ 75,019
                                                                           ========               ========
  Mortgage loans and unsecured notes assumed and/or entered into through                    
    Mergers and acquisitions of real estate                                $433,492               $517,639
                                                                           ========               ========
                                                                                            
  Net real estate contributed in exchange for OP units                     $164,149               $  5,134
                                                                           ========               ========
</TABLE> 


                            See accompanying notes.

                                       5
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)

Definition of Special Terms:

Capitalized terms used but not defined herein are as defined in the Operating
Partnership's Annual Report on Form 10-K for the year ended December 31, 1997
("Form 10-K").

1.   Business
 
     ERP Operating Limited Partnership (the "Operating Partnership"), an
Illinois limited partnership, was formed to conduct the multifamily property
business of Equity Residential Properties Trust ("EQR"). EQR is a Maryland real
estate investment trust formed on March 31, 1993. As used herein, the term
"Company" means EQR, and its subsidiaries, as the survivor of the mergers
between EQR and each of Wellsford Residential Property Trust ("Wellsford") (the
"Wellsford Merger") and Evans Withycombe Residential, Inc. ("EWR") (the "EWR
Merger"). The Company conducts substantially all of its operations through the
Operating Partnership. As of September 30, 1998, the Operating Partnership
controlled a portfolio of 550 multifamily properties (individually a "Property"
and collectively the "Properties"). The Operating Partnership's interest in six
of the Properties at the time of acquisition thereof consisted solely of
ownership of the debt collateralized by such Properties. The Operating
Partnership also has an investment in partnership interests and subordinated
mortgages collateralized by 21 properties (the "Additional Properties").

2.   Basis of Presentation

     The balance sheet as of September 30, 1998, the statements of operations
for the nine months and the three months ended September 30, 1998 and cash flows
for the nine months ended September 30, 1998 represent the consolidated
financial information of the Operating Partnership and its subsidiaries.

     Due to the Operating Partnership's ability to control, either through
ownership or by contract, the Management Partnerships, the Financing
Partnerships, the LLCs and the EWR Operating Partnership, each such entity has
been consolidated with the Operating Partnership for financial reporting
purposes. In regard to Management Corp., Management Corp. II and Evans
Withycombe Management, Inc., the Operating Partnership does not have legal
control; however, these entities are consolidated for financial reporting
purposes, the effects of which are immaterial.

     These unaudited Consolidated Financial Statements of the Operating
Partnership have been prepared pursuant to the Securities and Exchange
Commission ("SEC") rules and regulations and should be read in conjunction with
the Financial Statements and Notes thereto included in the Form 10-K. The
following Notes to Consolidated Financial Statements highlight significant
changes to the notes included in the Form 10-K and present interim disclosures
as required by the SEC. The accompanying Consolidated Financial Statements
reflect, in the opinion of management, all adjustments necessary for a fair
presentation of the interim financial statements. All such adjustments are of a
normal and recurring nature. Certain reclassifications have been made to the 
prior period's financial statements in order to conform to current period 
presentation.

                                       6
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

3.   Partners' Capital

     The limited partners of the Operating Partnership as of September 30, 1998
include various individuals and entities that contributed their properties to
the Operating Partnership in exchange for a partnership interest (the "Limited
Partners"). As of September 30, 1998, the Limited Partners were represented by
12,849,675 partnership interests ("OP Units"), which are exchangeable, subject
to certain restrictions, on a one-for-one basis into the Company's Common
Shares. As of September 30, 1998, the General Partner had an approximate 88.15%
interest in the Operating Partnership and the Limited Partners had an
approximate 11.85% interest.

     In regards to the General Partner, net proceeds from the various equity
offerings of the Company have been contributed by the Company to the Operating
Partnership in return for additional OP Units on a private placement basis,
which increases the General Partner's ownership percentage. Due to the Limited
Partners' ability to convert their interest into an ownership interest in the
General Partner, the net offering proceeds are allocated between the Company (as
General Partner) and the Limited Partners (to the extent represented by OP
Units) to account for the change in their respective percentage ownership of the
equity of the Operating Partnership.

     The Operating Partnership paid a $0.67 per OP Unit distribution on October
9, 1998 to OP Unit holders of record on September 16, 1998.

     The following table summarizes the distributions paid to the Company as
holder of the various Preference Units listed below related to the quarter ended
September 30, 1998:

<TABLE>
<CAPTION>
                                        Distribution Amount      Date Paid        Record Date
                                        -------------------      ---------        -----------
<S>                                     <C>                      <C>              <C>
     Series A Cumulative
        Redeemable Preference Units          $0.585938           10/15/98           09/16/98


     Series B Cumulative                                         
        Redeemable Preference Units          $0.570313           10/15/98           09/16/98

     Series C Cumulative                                         
        Redeemable Preference Units          $0.570313           10/15/98           09/16/98

     Series D Cumulative                                         
        Redeemable Preference Units          $0.537500           10/15/98           09/16/98

     Series E Cumulative                                         
        Convertible Preference Units         $0.437500           10/01/98           09/16/98

     Series F Cumulative                                         
        Redeemable Preference Units          $0.603125           10/15/98           09/16/98

     Series G Convertible
        Cumulative Preference Units          $0.453125           10/15/98           09/16/98
</TABLE>


     On January 27, 1998, the Company completed an offering of 4,000,000
publicly registered Common Shares, which were sold to the public at a price of
$50.4375 per share (the "January 1998 Common Share Offering"). The Company
contributed to the Operating Partnership net proceeds of approximately $195.3
million in connection therewith.


                                       7
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

     On February 18, 1998, the Company completed offerings of 988,340 publicly
registered Common Shares, which were sold to the public at a price of $50.625
per share. On February 23, 1998, the Company completed an offering of 1,000,000
publicly registered Common Shares, which were sold to the public at a price of
$48 per share. The Company contributed to the Operating Partnership net proceeds
from these offerings (collectively, the "February 1998 Common Share Offerings")
of approximately $95 million.

     On March 30, 1998, the Company completed an offering of 495,663 publicly
registered Common Shares, which were sold at a price of $47.9156 per share (the
"March 1998 Common Share Offering"). The Company contributed to the Operating
Partnership net proceeds of approximately $23.7 million in connection therewith.

     On April 29, 1998, the Company completed an offering of 946,565 publicly
registered Common Shares, which were sold at a price of $46.5459 per share (the
"April 1998 Common Share Offering"). The Company contributed to the Operating
Partnership net proceeds of approximately $44.1 million in connection therewith.

     On September 20, 1998, the Company completed its repurchase of 2,367,400 of
its Common Shares of beneficial interest, on the open market, for an average
price of $40 per share. The purchases were made between August 5 and September
17, 1998. The Operating Partnership paid approximately $94.7 million in
connection therewith.

     During the first nine months of 1998, the Company issued 1,018,763 Common
Shares pursuant to the Direct Share Purchase Plan. The Company contributed to
the Operating Partnership net proceeds of approximately $50.5 million in
connection therewith.

     During the nine months ended September 30, 1998, the Operating Partnership
issued 3,352,735 OP Units, having a value of approximately $164.1 million, in
various private placement transactions in exchange for the acquisition of
properties.

     Minority Interests represented by the Company's indirect 1% interest in
various Financing Partnerships and LLCs are immaterial and have not been
accounted for in the Consolidated Financial Statements. In addition, certain
amounts due from the Company for its 1% interest in the Financing Partnerships
has not been reflected in the Consolidated Balance Sheets since such amounts are
immaterial to the Consolidated Balance Sheets.

4.   Real Estate

     During the nine months ended September 30, 1998, the Operating Partnership
acquired the 96 Properties listed below from unaffiliated third parties. In
connection with certain of the acquisitions listed below, the Operating
Partnership assumed and/or entered into mortgage indebtedness of approximately
$433.5 million and issued OP Units having a value of approximately $164.1
million. The cash portion of these transactions was funded primarily from
the various capital transactions as discussed in Note 3 of the Notes to 
Consolidated Financial Statements, 

                                       8
<PAGE>

                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)


the various debt offerings as discussed in Note 10 of the Notes to Consolidated
Financial Statements, the Operating Partnership's line of credit and working
capital.

<TABLE>
<CAPTION>
                                                                             Total
                                                                          Acquisition
  Date                                                         Number         Cost
Acquired   Property                      Location             of Units   (in thousands)
--------   ---------------------------   ------------------   --------   --------------
<C>        <S>                           <C>                  <C>        <C> 
01/07/98   Cityscape                     St. Louis Park, MN       156        $ 12,399
01/09/98   740 River Drive               St. Paul,  MN            162          13,041
01/13/98   Prospect Towers               Hackensack, NJ           157          36,368
01/16/98   Park Place                    Houston, TX              229          13,602
01/16/98   Park Westend                  Richmond, VA             312          13,436
01/29/98   Emerald Bay at Winter Park    Winter Park, FL          432          15,889
02/05/98   Farnham Park                  Houston, TX              216          15,799
02/25/98   Plantation                    Houston, TX              232          10,294
02/27/98   Balcones Club                 Austin, TX               312          12,496
03/02/98   Coach Lantern                 Scarborough, ME           90           4,896
03/02/98   Foxcroft                      Scarborough, ME          104           5,067
03/02/98   Yarmouth Woods                Yarmouth, ME             138           6,832
03/20/98   Rolido Parque                 Houston, TX              369          10,974
03/26/98   The Fairfield                 Stamford, CT             263          45,973
03/26/98   Trails of Valley Ranch        Irving, TX               216          10,827
04/01/98   Sonterra at Foothill Ranch    Foothill Ranch, CA       300          31,587
04/01/98   Harbor Pointe                 Milwaukee, WI            595          25,401
04/01/98   Gates at Carlson Center       Minnetonka, MN           435          28,166
04/01/98   GlenGarry Club                Bloomingdale, IL         250          19,058
04/01/98   Plum Tree I II III            Hales Corners, WI        332          22,286
04/01/98   Ravinia                       Greenfield, WI           206          13,336
04/01/98   The Woodlands of Brookfield   Brookfield, WI           148          15,458
04/07/98   Vista Pointe at the Valley    Irving, TX               231          19,147
04/23/98   Emerson Place                 Boston, MA               462          72,459
05/13/98   Sierra Canyon                 Santa Clarita, CA        232          16,069
05/14/98   Northridge                    Pleasant Hill, CA        221          20,273
05/22/98   The Arboretum                 Canton, MA               156          15,705
05/28/98   Woodridge                     Eagan, MN                200          12,072
05/28/98   Townhomes of Meadowbrook      Auburn Hills, MI         230          13,794
06/01/98   Brookside                     Boulder, CO              144          13,809
06/10/98   The Greystone                 Atlanta, GA              150           7,484
06/11/98   Coconut Palm Club             Coconut Creek, FL        300          20,713
06/11/98   Portside Towers               Jersey City, NJ          527         119,282
06/16/98   Defoor Village                Atlanta, GA              156          13,538 
</TABLE>


                                        9
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                             Total
                                                                          Acquisition
  Date                                                         Number         Cost
Acquired   Property                      Location             of Units   (in thousands)
--------   ---------------------------   ------------------   --------   --------------
<C>        <S>                           <C>                  <C>        <C> 
06/16/98   Plantation Ridge              Marietta, GA             454          23,342
06/18/98   Wynbrook                      Norcross, GA             318          13,589
06/24/98   Cross Creek                   Matthews, NC             420          23,479
06/26/98   Copper Hill                   Bedford, TX              204           7,032
06/26/98   Walker's Mark                 Dallas, TX               164           7,019
06/26/98   Royal Crest Estates           Waterbury, CT            156           7,343
06/26/98   Tyrone Gardens                Randolph, MA             165          10,766
07/01/98   Trowbridge                    Atlanta, GA              210          12,020
07/01/98   Bellevue Meadows              Bellevue, WA             180          17,052
07/01/98   Chelsea Square                Redmond, WA              113          12,647
07/01/98   Olde Redmond Place            Redmond, WA              192          18,891
07/01/98   Surry Downs                   Bellevue, WA             122          10,865
07/01/98   Woodlake                      Kirkland, WA             288          23,375
07/01/98   Bramblewood                   San Jose, CA             108          14,807
07/01/98   Creekside                     San Mateo, CA            192          30,765
07/01/98   Grandview I & II              Las Vegas, NV            456          17,949
07/01/98   Lincoln Green I & II          Sunnyvale, CA            174          27,479
07/01/98   Lincoln Village I & II        Larkspur, CA             342          48,503
07/01/98   Mountain Shadows              Las Vegas, NV            300           9,411
07/01/98   Parkside                      Union City, CA           208          18,243
07/01/98   Summerwood                    Hayward, CA              162          11,769
07/01/98   Timberwood                    Aurora, CO               336          16,131
07/01/98   Turf Club                     Littleton, CO            324          17,604
07/01/98   Willowick                     Aurora, CO               100           4,646
07/01/98   Woodleaf                      Campbell, CA             178          25,501
07/08/98   Parkcrest                     Southfield, MI           210          11,682
07/08/98   Broadway                      Garland, TX              288           9,239
07/08/98   Cedar Ridge Townhomes         Arlington, TX            121           4,823
07/08/98   Fielder Crossing              Arlington, TX            119           4,620
07/08/98   Lakeshore at Preston          Plano, TX                302          18,515
07/08/98   Lakewood Greens               Dallas, TX               252          11,036
07/08/98   River Park                    Fort Worth, TX           280          11,038
07/08/98   Villas of Josey Ranch         Carrollton, TX           198           8,827
07/08/98   Wimbledon Oaks                Arlington, TX            248          10,310
07/08/98   Pleasant Ridge                Arlington, TX             63           2,410
07/08/98   Sandstone                     Euless, TX                40           1,805
07/09/98   Woodridge I                   Aurora, CO               212           8,642
07/09/98   Woodridge II                  Aurora, CO               116           4,728
07/09/98   Woodridge III                 Aurora, CO               256          10,435
</TABLE>                                                     


                                       10

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                             Total
                                                                          Acquisition
  Date                                                         Number         Cost
Acquired   Property                      Location             of Units   (in thousands)
--------   ---------------------------   ------------------   --------   --------------
<C>        <S>                           <C>                  <C>        <C> 
07/09/98   Southwood                     Palo Alto, CA             99          21,237
07/10/98   Martins Landing               Roswell, GA              300          17,749
07/10/98   The Lakes at Vinings          Atlanta, GA              464          28,341
07/14/98   Summer Creek                  Plymouth, MN              72           4,407
07/15/98   Patchen Oaks                  Lexington, KY            192           9,490
07/15/98   Lexington Village             Alpharetta, GA           352          24,576
07/15/98   Overlook Manor I              Frederick, MD            108           5,202
07/15/98   Overlook Manor II             Frederick, MD            182           8,458
07/15/98   Overlook Manor III            Frederick, MD             64           4,032
07/15/98   Brookside II                  Frederick, MD            204           9,372
07/16/98   Coachman Trails               Plymouth, MN             154          10,772
07/21/98   Colony Woods                  Birmingham, AL           414          23,477
07/22/98   Arbors at Century Center      Memphis, TN              420          17,780
07/31/98   Briarwood                     Sunnyvale, CA            192          32,176
07/31/98   Skylark                       Union City, CA           174          18,290
07/31/98   Greenhaven                    Union City, CA           250          22,635
07/31/98   Alderwood Park                Lynnwood , WA            188          11,814
08/05/98   Fernbrook Townhomes           Plymouth, MN              72           7,247
08/14/98   North Creek                   Everett, WA              264          16,072
08/21/98   Esprit Del Sol                Solana Beach, CA         146          17,012
09/25/98   Smoketree Polo Club           Indio, CA                288           8,004
09/29/98   Georgian Woods I              Wheaton, MD               97           5,719
09/29/98   Georgian Woods III            Wheaton, MD              102           6,013
                                                               ------      ----------             
                                                               22,032      $1,605,743
                                                               ======      ==========
</TABLE>


5.   Commitments to Acquire/Dispose of Real Estate

     As of September 30, 1998, in addition to the Properties that were
subsequently acquired as discussed in Note 14 of the Notes to Consolidated
Financial Statements, the Operating Partnership had entered into separate
agreements to acquire 16 multifamily properties containing 4,645 units from
unaffiliated third parties. The expected combined purchase price is
approximately $293.2 million, which includes the assumption of mortgage
indebtedness of approximately $115.6 million.

     As of September 30, 1998, in addition to the Properties that were 
subsequently disposed of as discussed in Note 14 of the Notes to Consolidated 
Financial Statements, the Operating Partnership entered into separate agreements
to dispose of 10 multifamily properties containing 2,490 units to unaffiliated 
third parties. The expected combined disposition price is approximately $79.5 
million.

     The closings of these pending transactions are subject to certain
contingencies and conditions; therefore, there can be no assurance that these
transactions will be consummated or that the final terms thereof will not differ
in material respects from those summarized in the preceding paragraph.


                                       11

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

6.   Disposition of Real Estate

<TABLE> 
<CAPTION> 
                                                                           Disposition
                                                                Number      Price (in
Date Disposed   Property                  Location             of Units     thousands)
-------------   --------                  --------             --------    -----------
<S>             <C>                       <C>                  <C>          <C> 
  03/12/98      Mountain Brook/Ridgemont  Chattanooga, TN         506        $16,700
  05/01/98      The Place                 Fort Myers, FL          230          8,500
  05/15/98      Terraces at Peachtree     Atlanta, GA              96          7,225
  06/02/98      Stonelake Club            Ocala, FL               240          8,680
  07/31/98      Country Club I & II       Silver Springs, MD      376         20,750
  09/04/98      Miramonte                 Scottsdale, AZ          151          9,500
  09/30/98      Gold Pointe               Tacoma, WA               84          5,700
                                                                -----        -------
                                                                1,683        $77,055
                                                                =====        =======
</TABLE> 

     The Operating Partnership recognized a total net gain for financial
reporting purposes of approximately $12.7 million on the disposition of these
nine properties.

7.   Calculation of Net Income Per Weighted Average OP Unit

     The following tables set forth the computation of net income per weighted
average OP Unit outstanding and net income per weighted average OP Unit
outstanding -- assuming dilution.

                                      12

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

<TABLE> 
<CAPTION> 
                                                                       Nine Months Ended September 30,   Quarter Ended September 30,
                                                                       -------------------------------   ---------------------------
                                                                            1998             1997            1998           1997
                                                                       -------------------------------   ---------------------------
                                                                              (Amounts in thousands except per OP Unit amounts)
<S>                                                                       <C>              <C>             <C>            <C> 
Numerator:

 Income before allocation of income to Redeemable
  Preference Units and gain on disposition
  of properties                                                           $182,017         $121,413        $ 59,477       $ 50,029
 Income allocated to Redeemable Preference Units                           (65,075)         (37,287)        (21,691)       (16,348)
                                                                          --------         --------        --------       --------
 Income before gain on disposition of properties                           116,942           84,126          37,786         33,681

 Gain on disposition of properties                                          12,717            3,923           1,625            291
                                                                          --------         --------        --------       --------
 Numerator for net income per weighted average
  OP Unit outstanding                                                     $129,659           88,049          39,411         33,972

 Effect of dilutive securities:
  Series E Cumulative Convertible Preference Units                               -                -               -             -
  Series G Convertible Cumulative Preference Units                               -                -               -             -
                                                                          --------         --------        --------       --------
 Numerator for net income per weighted average
  OP Unit outstanding - assuming dilution                                 $129,659         $ 88,049        $ 39,411       $ 33,972
                                                                          ========         ========        ========       ========
Denominator:

 Denominator for net income per weighted
  average OP Unit outstanding                                              106,630           68,970         109,688         81,134

 Effect of dilutive securities (1):
  OP Units issuable upon exercise of the
   Company's share options                                                     922              989             628          1,191
                                                                          --------         --------        --------       --------
 Denominator for net income per weighted average
  OP Unit outstanding - assuming dilution                                  107,552           69,959         110,316         82,325
                                                                          ========         =========       ========       ========
 Net income per weighted average OP Unit outstanding                      $   1.22         $   1.28        $   0.36       $   0.42
                                                                          ========         =========       ========       ========
 Net income per weighted average OP Unit
  outstanding - assuming dilution                                         $   1.21         $   1.26        $   0.36       $   0.41
                                                                          ========         =========       ========       ========
</TABLE> 

                                      13

<PAGE>

          ERP OPERATING LIMITED PARTNERSHIP
  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     (Unaudited)

<TABLE> 
<CAPTION> 
                                                                       Nine Months Ended September 30,   Quarter Ended September 30,
                                                                       -------------------------------   ---------------------------
                                                                            1998             1997            1998           1997
                                                                       -------------------------------   ---------------------------
<S>                                                                       <C>              <C>             <C>            <C> 
 Net income per weighted average OP Unit
  outstanding:

 Income before gain on disposition of properties
   per weighted average OP Unit outstanding                               $   1.09         $   1.22        $   0.34       $   0.42
 Gain on disposition of properties                                            0.13             0.06            0.02           0.00
                                                                          --------         --------        --------       --------

 Net income per weighted average OP Unit outstanding                      $   1.22         $   1.28        $   0.36       $   0.42
                                                                          ========         ========        ========       ========

 Net income per weighted average OP Unit
  outstanding - assuming dilution:

 Income before gain on disposition of properties
  per weighted average OP Unit outstanding -
  assuming dilution                                                       $   1.09         $   1.20        $   0.34       $   0.41
 Gain on disposition of properties                                            0.12             0.06            0.02           0.00
                                                                          --------         --------        --------       --------

 Net income per weighted average OP Unit
  outstanding - assuming dilution                                         $   1.21         $   1.26        $   0.36       $   0.41
                                                                          ========         ========        ========       ========
</TABLE> 


(1) Convertible Preference Units that could be converted into 7,622,951 Common 
    Shares, which would be contributed to the Operating Partnership in exchange
    for OP Units, were outstanding at September 30, 1998 but were not included
    in the computation of diluted earnings per OP Unit because it would be anti-
    dilutive.

                                      14

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

8.   Mortgage Notes Payable

     As of September 30, 1998 the Operating Partnership had outstanding mortgage
indebtedness of approximately $1.96 billion encumbering 184 of the Properties.
The carrying value of such Properties (net of accumulated depreciation of $209.7
million) was approximately $3.2 billion. The mortgage notes payables are
generally due in monthly installments of interest only. In connection with the
Properties acquired during the Nine months ended September 30, 1998, the
Operating Partnership assumed and/or entered into mortgage indebtedness on forty
Properties in the aggregate amount of $433.5 million.

     Concurrent with the refinancing of certain tax-exempt bonds and as a
requirement of the credit provider of the bonds, the Financing Partnership,
which owns certain of the Properties entered into interest rate protection
agreements, which were assigned to the credit provider as additional security.
The Financing Partnership pays interest based on a fixed interest rate and the
counterparty of the agreement pays interest to the Operating Partnership at a
floating rate which is calculated based on the Public Securities Association
Index for municipal bonds ("PSA Municipal Index"). As of September 30, 1998, the
aggregate notional amount of these agreements was approximately $172.6 million.
The fixed interest rates for these agreements were 4.81%, 4.528% and 4.90%. The
termination dates are October 1, 2003, January 1, 2004 and April 1, 2004.

     The Operating Partnership simultaneously entered into substantially
identical reverse interest rate protection agreements. Under these agreements
the Operating Partnership pays interest monthly at a floating rate based on the
PSA Municipal Index and the counterparty pays interest to the Operating
Partnership based on a fixed interest rate. As of September 30, 1998, the
aggregate notional amount of these agreements was approximately $172.6 million.
The fixed interest rates received by the Operating Partnership in exchange for
paying interest based on the PSA Municipal Index for these agreements were
4.74%, 4.458% and 4.83%. The termination dates are October 1, 2003, January 1,
2004 and April 1, 2004.
 
     Collectively, these agreements effectively cost the Operating Partnership
0.07% per annum on the current outstanding aggregate notional amount. The
Operating Partnership believes that it has limited exposure to the extent of 
non-performance by the counterparties of the agreements since each counterparty
is a major U.S. financial institution, and the Operating Partnership does not
anticipate their non-performance.

     The Operating Partnership also has an interest rate cap agreement for a
notional amount of $228 million, for which it will receive payments if the PSA
index exceeds 5.75%, that terminates on December 1, 1999. Any payments by the
counterparty under this agreement have been collaterally assigned to the
provider of certain sureties related to the tax-exempt bonds secured by certain
of it's Properties. The Operating Partnership has no payment obligations to the
counterparty with respect to this agreement.

     As of September 30, 1998, scheduled maturities for the Operating
Partnership's outstanding mortgage indebtedness are at various dates through
February 1, 2032. During the nine months

                                      15

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

ended September 30, 1998, the Operating Partnership repaid the outstanding
mortgage balance on seven Properties in the amount of $46.9 million. Subsequent 
to September 30, 1998, the Operating Partnership repaid the outstanding mortgage
balances on two Properties in the aggregate amount of approximately $17 million.

9.   Line of Credit

     As of September 30, 1998, there was $310 million outstanding on the line
of credit, bearing interest at a weighted average interest rate of 6.07%.

10.  Notes

     As of September 30, 1998, the Operating Partnership had outstanding
unsecured notes of approximately $1.7 billion (net of a $4.9 million discount
and including a $7 million premium).

     In February 1996, the Operating Partnership entered into a forward starting
swap agreement that hedged the interest rate risk of the 1999 Notes by locking
the effective four-year Treasury Rate, commencing May 15, 1999 through May 2003.
There was no cost to the Operating Partnership for entering into this agreement.

     Prior to the issuance of the 2002 Notes, the Operating Partnership entered
into an interest rate protection agreement to effectively fix the interest rate
cost of such issuance.  The Operating Partnership made a one-time settlement
payment of this protection transaction, which was approximately $0.8 million and
is being amortized over the term of the 2002 Notes.  As of September 30, 1998,
the unamortized balance of this cost was approximately $0.4 million.

     Prior to the issuance of the 2026 Notes, the Operating Partnership entered
into an interest rate protection agreement to effectively fix the interest rate
cost of such issuance.  The Operating Partnership received a one-time settlement
payment of this transaction, which was approximately $0.6 million and is being
amortized over ten years.  As of September 30, 1998, the unamortized balance was
approximately $0.5 million.

     Prior to the issuance of the 2001 and 2003 Notes, the Operating Partnership
entered into two interest rate protection agreements to effectively fix the
interest rate costs of such issuance's. The Operating Partnership made a one
time settlement payment of each protection transaction, which was approximately
$5 million and $1.7 million, respectively, which are being amortized over the
term of the Notes on a straight-line basis.  As of September 30, 1998 the
unamortized balance of these costs were approximately $3.9 million and $1.4
million, respectively.

     In April 1998, the Operating Partnership issued $300 million of unsecured
fixed rate notes (the "2015 Notes") in connection with the Debt Shelf
Registration in a public debt offering (the "Sixth Public Debt Offering").  The
2015 Notes were issued at a discount, which is being amortized over the life of
the 2015 Notes on a straight-line basis.  The 2015 Notes are due April 

                                      16
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

13, 2015. The annual interest rate on the 2015 Notes to April 13, 2005 (the
"Remarketing Date") is 6.63%, which is payable semiannually in arrears on
October 13 and April 13, commencing October 13, 1998. The 2015 Notes are subject
to mandatory tender on the Remarketing Date. The Operating Partnership received
net proceeds of approximately $298.1 million in connection with this issuance.
The Operating Partnership also received approximately $8.1 million from the sale
of the option to remarket the 2015 Notes on the Remarketing Date, which is being
amortized over the term of the 2015 Notes. As of September 30, 1998 the
unamortized balance was approximately $7.9 million. Prior to the issuance of the
2015 Notes, the Operating Partnership entered into an interest rate protection
agreement to effectively fix the interest rate cost of such issuance until the
Remarketing Date. The Operating Partnership received a one-time settlement
payment from this transaction, which was approximately $0.6 million and is being
amortized over seven years. As of September 30, 1998 the unamortized balance was
approximately $0.6 million.

     In August 1998, the Operating Partnership issued $100 million of Remarketed
Reset Notes (the "August 2003 Notes") in connection with the Debt Shelf
Registration in a public debt offering (the "Seventh Public Debt Offering").
The August 2003 Notes were issued at a discount, which is being amortized over
the life of the notes on a straight-line basis.  The August 2003 Notes are due
August 21, 2003.  During the period from and including August 21, 1998 to but
excluding August 23, 1999 (the "Initial Spread Period") the interest rate on the
August 2003 Notes will be reset quarterly, and will equal LIBOR plus an
applicable spread. The spread during the Initial Spread Period is .45%. After
the Initial Spread Period, the character (i.e. fixed or floating rate) and
duration of the interest rate on the notes will be agreed to by the Operating
Partnership and the Remarketing Underwriter on each applicable determination
date, and the subsequent spread will be agreed to by the Operating Partnership
and the Remarketing Underwriter, initially Merrill Lynch, Pierce, Fenner and
Smith, Inc., on the corresponding spread determination date. The Operating
Partnership received net proceeds of approximately $99.7 million in connection
with this issuance.

     In September 1998, the Operating Partnership issued $145 million of
unsecured fixed rate notes (the "2000 Notes") in connection with the Debt Shelf
Registration in a public debt offering (the "Eighth Public Debt Offering").  The
2000 Notes were issued at a discount, which is being amortized over the life of
the notes on a straight-line basis.  The 2000 Notes are due September 15, 2000.
The annual interest rate on the 2000 Notes is 6.15%, which is payable semi-
annually in arrears on March 15 and September 15, commencing March 15, 1999.
The Operating Partnership received net proceeds of approximately $144.5 million
in connection with this issuance.

     In regard to all of the interest rate protection agreements mentioned in
the previous paragraphs, the Operating Partnership believes that it has limited
exposure to the extent of non-performance by the counterparties of each
agreement since each counterparty is a major U.S. financial institution, and the
Operating Partnership does not anticipate their non-performance.

                                      17

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)

11.  Deposits - restricted

     Deposits-restricted as of September 30, 1998 primarily included a deposit
in the amount of $20 million held in a third party escrow account to provide
collateral for third party construction financing in connection with the Joint
Venture Agreement. Also, approximately $16.2 million was held in third party
escrow accounts, representing proceeds received in connection with the Operating
Partnership's disposition of two properties and earnest money deposits made for
additional acquisitions. In addition, approximately $14.6 million was for tenant
security and utility deposits for certain of the Operating Partnership's
Properties.

12.  Summarized Pro Forma Condensed Statement of Operations
 
     The following Summarized Pro Forma Condensed Statement of Operations has
been prepared as if the January 1998 Common Share Offering, the February 1998
Common Share Offerings, the March 1998 Common Share Offering, the April 1998
Common Share Offering, the Sixth Public Debt Offering, the Seventh Public Debt
Offering, the Eighth Public Debt Offering, the acquisition of an additional 96
Properties, including the related assumption of $433.5 million of mortgage
indebtedness, the issuance of OP Units with a value of $164.1 million and the
disposition of nine properties (as described in Note 3, Note 4, Note 6, Note 8
and Note 10 of Notes to Consolidated Financial Statements) had occurred on
January 1, 1998. This would result in 110,181,843 OP Units outstanding. In
management's opinion, the Summarized Pro Forma Condensed Statement of Operations
does not purport to present what actual results would have been had the above
transactions occurred on January 1, 1998, or to project results for any future
period. The amounts presented in the following statement are in thousands except
for OP Unit amounts:

<TABLE>
<CAPTION>
                                                               Summarized
                                                                Pro Forma
                                                           Condensed Statement
                                                              of Operations
                                                           For the Nine Months
                                                                  Ended
                                                           September 30, 1998
                                                           -------------------
<S>                                                            <C>
Total Revenues                                                 $1,011,035
                                                               ----------
Total Expenses                                                    828,672
                                                               ----------
Pro Forma net income available for OP Units                    $  130,005
                                                               ==========
Pro Forma net income per OP Unit                               $     1.18
                                                               ==========
</TABLE>

                                       18
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                  (Unaudited)
                                        
13.  Commitments and Contingencies

     The Operating Partnership, as an owner of real estate, is subject to
various environmental laws of Federal and local governments. Compliance by the
Operating Partnership with existing laws has not had a material adverse effect
on the Operating Partnership's financial condition and results of operations.
However, the Operating Partnership cannot predict the impact of new or changed
laws or regulations on its current Properties or on properties that it may
acquire in the future.

     The Operating Partnership does not believe there is any litigation
threatened against the Operating Partnership other than routine litigation
arising out of the ordinary course of business. Some of which is expected to be
covered by liability insurance, none of which is expected to have a material
adverse effect on the consolidated financial statements of the Operating
Partnership.

     In connection with the Joint Venture Agreement, the Operating Partnership
has a contingent obligation to fund an additional $20 million in connection with
the third party construction financing.

     In connection with the Wellsford Merger, the Operating Partnership has
provided a standby obligation in the amount of $30 million pursuant to an
agreement entered into with Wellsford Real Properties, Inc., a Maryland
corporation ("WRP"), for the construction financing for a multifamily
development project located in Denver, Colorado. In addition, the Operating
Partnership has provided a $14.8 million credit enhancement with respect to
bonds issued to finance certain public improvements at the multifamily
development project. The aforementioned multifamily development project was 
completed during the third quarter of 1998. As a result of this the Operating
Partnership anticipates that permanent financing will be secured in the fourth
quarter of 1998, at which time, the Operating Partnership's standby commitment
will be terminated.

14.  Subsequent Events

     On October 6, 1998, the Operating Partnership sold Windridge Apartments
located in Lakewood, Washington for a sales price of $3.4 million.

     On October 7, 1998, the Operating Partnership sold a portfolio of five
properties located in Oklahoma City, Oklahoma for a sales price of $49.9
million.

     On October 19, 1998, the Operating Partnership acquired through the merger
of the multifamily property business of Merry Land and Investment Company, Inc.
("Merry Land") with and into the Company 118 multifamily properties containing 
34,990 units in nine states, including 6 properties consisting of 1,962 units
under development. In the Merger, each outstanding common share of beneficial 
interest of Merry Land will be converted into .53 of a common share of the
surviving company. The transaction is valued at approximately $2.2 billion,
which includes the issuance of $1.1 billion of common stock, $370 million of
preferred stock and the assumption of indebtedness of $700 million.

     On October 29, 1998, the Operating Partnership sold Newport Cove Apartments
located in Henderson, Nevada for a sales price of $8.5 million.

                                      19
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

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

Overview

     The following discussion and analysis of the results of operations and
financial condition of the Operating Partnership should be read in connection
with the Consolidated Financial Statements and Notes thereto. Due to the
Operating Partnership's ability to control the EWR Operating Partnership, the
Management Partnerships, the Financing Partnerships and the LLCs, each entity
has been consolidated with the Operating Partnership for financial reporting
purposes. Capitalized terms used herein and not defined are as defined in the
Operating Partnership's Annual Report on Form 10-K.

     Forward-looking statements in this report are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. The
words "believes", "expects" and "anticipates" and other similar expressions
which are predictions of or indicate future events and trends and which do not
relate solely to historical matters, identify forward-looking statements. Such
forward-looking statements are subject to risks and uncertainties, which could
cause actual results, performance, or achievements of the Operating Partnership
to differ materially from anticipated future results, performance or
achievements expressed or implied by such forward-looking statements. Factors
that might cause such differences include, but are not limited to, the
following: the alternative sources of capital to the Operating Partnership are
too high; occupancy levels and market rents may be adversely affected by local
economic and market conditions, which are beyond the Operating Partnership's
control; the Year 2000 Issue discussed below; and additional factors as
discussed in Part I of the Annual Report as filed on Form 10-K. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. The Operating Partnership undertakes no
obligation to publicly release any revisions to these forward-looking
statements, which may be made to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.

Results of Operations

     Since EQR's IPO and through September 30, 1998, the Operating Partnership
has acquired direct or indirect interests in 508 properties (the "Acquired
Properties"), containing 140,542 units in the aggregate, for a total purchase
price of approximately $8.2 billion, including the assumption of and/or new
mortgage indebtedness of approximately $2.4 billion and $0.4 billion of
unsecured notes. The Operating Partnership's interest in six of the Acquired
Properties at the time of acquisition thereof consisted solely of ownership of
the debt collateralized by such Acquired Properties. The Operating Partnership
purchased its interests in 96 of such Acquired Properties consisting of 22,032
units in 1998 (the "1998 Acquired Properties").

     During the nine months ended September 30, 1998, the Operating Partnership
disposed of nine properties (the "1998 Disposed Properties") for a total sales
price of $77.1 million.

     The Operating Partnership's overall results of operations for the nine
months ended

                                      20
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

September 30, 1998 and 1997 have been significantly impacted by the Operating
Partnership's acquisition activity. The significant changes in rental revenues,
property and maintenance expenses, real estate taxes and insurance, depreciation
expense, property management and interest expense can all primarily be
attributed to the acquisition of the 1997 Acquired Properties and the 1998
Acquired Properties. The impact of the 1997 Acquired Properties and the 1998
Acquired Properties is discussed in greater detail in the following paragraphs.

     Properties that the Operating Partnership owned for all of both nine month
periods ended September 30, 1998 and September 30, 1997 (the "Nine-month 1998
Same Store Properties") impacted the Operating Partnership's results of
operations. Properties that the Operating Partnership owned for all of both the
quarters ended September 30, 1998 and September 30, 1997 (the "Third-Quarter
1998 Same Store Properties") also impacted the Operating Partnership's results
of operations. Both the Nine-month 1998 Same Store Properties and Third-Quarter
1998 Same Store Properties are discussed in the following paragraphs.


    Comparison of nine months ended September 30, 1998 to nine months ended
                              September 30, 1997

     For the nine months ended September 30, 1998, income before gain on
disposition of properties increased by $60.6 million when compared to this nine
months ended September 30, 1997. This increase was primarily due to increases in
rental revenues net of increases in property and maintenance expenses, real
estate taxes and insurance, property management expenses, depreciation expense,
interest expense and general and administrative expenses. All of the increases
in the various line item accounts mentioned above can be primarily attributed to
the 1998 Acquired Properties and 1997 Acquired Properties. These increases were
partially offset by the 1997 Disposed Properties and the 1998 Disposed
Properties. 

     In regard to Nine-month 1998 Same Store Properties, which represents 63,710
units, rental revenues increased by approximately $18.5 million to $396.4
million or 4.9% primarily as a result of higher rental rates charged to new
tenants and tenants renewals, as well as a 1.34% increase in average economic
occupancy levels. Overall, property operating expenses which include property
and maintenance, real estate taxes and insurance and an allocation of property
management expenses increased approximately $4 million or 2.7%. This increase
was primarily the result of higher compensation costs, utilities, administrative
costs, maintenance costs and leasing and advertising costs.

     Property management represents expenses associated with the management of
the Operating Partnership's Properties. These expenses increased by
approximately $19.5 million

                                       21
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

primarily due to the continued expansion of the Operating Partnership's property
management business to facilitate the management of the Operating Partnership's
additional properties.

     Interest expense, including amortization of deferred financing costs,
increased by approximately $87.5 million. This increase was primarily the result
of an increase in the Operating Partnership's average indebtedness outstanding
which increased by $1.7 billion. However, the Operating Partnership's effective
interest costs decreased from 7.53% for the nine months ended September 30, 1997
to 7.17% for the nine months ended September 30, 1998.

     General and administrative expenses, which include corporate operating
expenses, increased approximately $5.6 million between the periods under
comparison. This increase was primarily due to the addition of corporate
personnel, higher compensation costs and shareholder reporting costs as well as
an increase in professional fees. However, by gaining certain economies of scale
with a much larger operation these expenses as a percentage of total revenues
were 1.67% for the nine months ended September 30, 1998 compared to 1.97% of
total revenues for the nine months ended September 30, 1997.
 
 Comparison of quarter ended September 30, 1998 to quarter ended 
                              September 30, 1997

     For the quarter ended September 30, 1998, income before gain on disposition
of properties increased by $9.4 million when compared to the quarter ended
September 30, 1997. This increase was primarily due to increases in rental
revenues net of increases in property and maintenance expenses, real estate
taxes and insurance, property management expenses, depreciation, interest
expense and general and administrative expenses. All of the increases in the
various line item accounts mentioned above can be primarily attributed to the
continued purchase of multifamily properties, specifically the 1998 Acquired
Properties and 1997 Acquired Properties. These increases were partially offset
by the 1997 Disposed Properties and the 1998 Disposed Properties.

     In regard to the Third-Quarter 1998 Same Store Properties, which represents
91,240 units, rental revenues increased by approximately $9.2 million to $188.9
million or 5.13% primarily as a result of higher rental rates charged to new
tenants and tenant renewals, as well as a 1.21% increase in average economic
occupancy levels. Overall property operating expenses which include property and
maintenance, real estate taxes and insurance and an allocation of property
management expenses increased approximately $2.7 million or 3.7%. This increase
was primarily the result of higher compensation costs, utilities, administrative
costs, maintenance costs and leasing and advertising costs.

     Property management represents expenses associated with the management of
the Operating Partnership's Properties. These expenses increased by
approximately $6.2 million primarily due to the continued expansion of the
Operating Partnership's property management business to facilitate the
management of the Operating Partnership's additional properties.

                                       22
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

     Interest expense, including amortization of deferred financing costs,
increased by approximately $32.7 million. This increase was primarily the result
of an increase in the Operating Partnership's average indebtedness outstanding,
which increased by $2 billion. However, the Operating Partnership's effective
interest costs decreased from 7.52% for the quarter ended September 30, 1997 to
6.99% for the quarter ended September 30, 1998.

     General and administrative expenses, which include corporate operating
expenses, increased approximately $1.5 million between the periods under
comparison. This increase was primarily due to the addition of corporate
personnel, higher compensation costs and shareholder reporting costs as well as
an increase in professional fees. However, by gaining certain economies of scale
with a much larger operation these expenses as a percentage of total revenues
were 1.57% for the quarter ended September 30, 1998, which was a decrease from
1.88% for the quarter ended September 30, 1997.

Liquidity and Capital Resources

     As of January 1, 1998, the Operating Partnership had approximately $33.3
million of cash and cash equivalents and $265 million available on its line of
credit of which $24.7 million was restricted. After taking into effect the
various transactions discussed in the following paragraphs, the Operating
Partnership's cash and cash equivalents balance at September 30, 1998 was
approximately $154 million and the amount available on the Operating
Partnership's line of credit was $190 million of which $36.7 million was
restricted. The following discussion also explains the changes in net cash
provided by operating activities, net cash (used for) investing activities and
net cash provided by financing activities, all of which are presented in the
Operating Partnership's Statements of Cash Flows.

     With respect to Property acquisitions during the nine months, the Operating
Partnership purchased 96 Properties containing 22,032 units for a total
acquisition cost of approximately $1.6 billion, including the assumption of
and/or new mortgage indebtedness of approximately $433.5 million and the
issuance of OP units with a value of $164.1 million. These acquisitions were
primarily funded from proceeds received from the various capital and debt
transactions as discussed in Note 3 and Note 10, respectively, of the Notes to
Consolidated Financial Statements, the Operating Partnership's line of credit
and working capital.

     Subsequent to September 30, 1998, the Operating Partnership closed its 
merger with Merry Land and through this merger acquired 118 properties 
containing 34,990 units, including 6 properties consisting of 1,962 units under 
development. In the Merger, each outstanding common share of beneficial interest
of Merry Land will be converted into .53 of a common share of the surviving 
company. The transaction is valued at approximately $2.2 billion, including the 
issuance of $1.1 billion of common stock, $370 million of preferred stock and 
the assumption of indebtedness of $700 million. Also, in connection with the
merger, the Operating Partnership was required to pay off one of Merry Land's
unsecured notes issued in the amount of $120 million as well as various merger
costs. The Operating Partnership borrowed certain amounts under its line of
credit to fund these needs.

                                       23
<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations (continued)

     During the nine months ended September 30, 1998, the Operating Partnership
disposed of nine properties that generated net sales proceeds of $76 million.
These proceeds were applied to pay down the Operating Partnership's line of
credit.

     As of September 30, 1998, the Operating Partnership had total indebtedness
of approximately $3.9 billion, which included mortgage indebtedness of $1.96
billion (including premiums of $3.2 million), of which $818 million represented
tax-exempt bond indebtedness, unsecured debt of $1.67 billion (including net
discounts and premiums in the amount of $2.2 million) and $310 million
outstanding on the Operating Partnership's line of credit. During the first nine
months, the Operating Partnership repaid $46.9 million of mortgage indebtedness
on seven of its Properties. These repayments were funded from the Operating
Partnership's line of credit or from proceeds received for the various capital
and debt transactions as discussed in Note 3 and Note 10, respectively, of the
Notes to Consolidated Financial Statements.

     The Operating Partnership has, from time to time, entered into interest
rate protection agreements (financial instruments) to reduce the potential
impact of increases in interest rates but believes it has limited exposure to
the extent of non-performance by the counterparties of each protection agreement
since each counterparty is a major U.S. financial institution, and the Operating
Partnership does not anticipate their non-performance. No such financial
instrument has been used for trading purposes.

     In February 1996, the Operating Partnership entered into a forward starting
swap agreement that will hedge the Operating Partnership's interest rate
risk at maturity of $125 million of indebtedness. This agreement hedged the
interest rate risk of the Operating Partnership's 1999 Notes by locking the
effective four-year Treasury Rate, commencing May 15, 1999.

     In August 1996, the Operating Partnership entered into an interest rate
protection agreement to effectively fix the interest rate cost of the Operating
Partnership's 2026 Notes. The agreement was for a notional amount of $150
million with a locked in treasury rate of 7.57%.

     In July 1997, the Operating Partnership entered into two interest rate
protection agreements to effectively fix the interest rate cost of the Operating
Partnership's 2001 Notes and 2003 Notes. One agreement was for a notional amount
of $100 million with a locked in treasury rate at 6.134%. The second agreement
was for a notional amount of $75 million with a locked in treasury rate of
6.287%.

     In April 1998, the Operating Partnership entered into an interest rate
protection agreement to effectively fix the interest rate cost of the Operating
Partnership's 2015 Notes. The


                                       24

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations (continued)

agreement was for a notional amount of $300 million with a locked in treasury
rate of 6.63%.

     In May 1998, the Operating Partnership entered into an interest rate 
protection agreement to effectively fix the interest rate cost of the Evans 
Withycombe Financing Limited Partnership indebtedness to within a range of 
5.6% to 6.0%. The agreement was for a notional amount of $131 million with a
settlement date of August 2001. There was no initial cost to the Operating
Partnership for entering into this agreement.

     In August 1998, the Operating Partnership entered into an interest rate 
protection agreement to effectively fix the interest rate cost of the Operating 
Partnership's planned financing in the fourth quarter of 1998. The agreement was
for a notional amount of $100 million.

     In August 1998, the Operating Partnership entered into an interest rate
swap agreement that fixed the interest rate risk on a portion of the Operating
Partnership's variable rate tax-exempt bond indebtedness at a rate of 3.65125%.
This agreement was for a notional amount of $150 million with a termination date
of August 2003.

     In August 1998, the Operating Partnership entered into an interest rate
swap agreement that fixed the interest rate risk on a portion of the Operating
Partnership's variable rate tax exempt bond indebtedness at a rate of 3.683%.
This agreement was for a notional amount of $150 million with a termination date
of August 2005.

     The fair value of these instruments as of September 30, 1998 approximates
their carrying or contract values.

     The Operating Partnership has a policy of capitalizing expenditures made
for new assets, including newly acquired properties and the costs associated
with placing these assets into service. Expenditures for improvements and
renovations that significantly enhance the value of existing assets or
substantially extend the useful life of an asset are also capitalized. Capital
spent for replacement-type items such as appliances, draperies, carpeting and
floor coverings, mechanical equipment and certain furniture and fixtures is also
capitalized. Expenditures for ordinary maintenance and repairs are expensed to
operations as incurred. With respect to acquired properties, the Operating
Partnership has determined that it generally spends $1,000 per unit during its
first three years of ownership to fully improve and enhance these properties to
meet the Operating Partnership's standards. In regard to replacement-type items
described above, the Operating Partnership generally expects to spend, on an
annual basis, $300 per unit.

     During the nine months ended September 30, 1998, total capital expenditures
for the Operating Partnership approximated $68.5 million. Of this amount,
approximately $14.8 million related to capital improvements and major repairs
for certain of the 1995, 1996, 1997 and 1998 Acquired Properties. Capital
improvements and major repairs for all of the Operating Partnership's pre-IPO
properties and certain Acquired Properties approximated $18.2 million, or $127
per unit. Capital spent for replacement-type items approximated $27.6 million,
or $192 per unit. Also included in total capital expenditures was approximately
$7.9 million expended for non-real estate additions such as computer software,
computer equipment, furniture and fixtures and leasehold improvements for the
Operating Partnership's property management offices and its corporate
headquarters. Such capital expenditures were primarily funded from working
capital reserves and from net cash provided by operating activities. Total
capital expenditures for the remaining portion of 1998 are budgeted to be
approximately $27.5 million.

     Total distributions paid in October 1998 amounted to approximately $94.3
million, which included distributions declared for the quarter ended September
30, 1998.

     The Operating Partnership expects to meet its short-term liquidity
requirements, including capital expenditures relating to maintaining its
existing Properties, generally through its working capital, net cash provided by
operating activities and borrowings under its line of credit. The Operating
Partnership considers its cash provided by operating activities to be adequate
to meet operating requirements and payments of distributions. The Operating
Partnership also expects to meet its long-term liquidity requirements such as
scheduled mortgage debt maturities, reduction of outstanding amounts under its
line of credit, property acquisitions, financing of construction and development
activities and capital improvements through the


                                       25

<PAGE>

                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations (continued)

issuance of unsecured notes and equity securities, including additional OP
Units, as well as from undistributed FFO and proceeds received from the
disposition of certain Properties. In addition, the Operating Partnership has
certain uncollateralized Properties available for additional mortgage borrowings
in the event that the public capital markets are unavailable to the Operating
Partnership or the cost of alternative sources of capital to the Operating
Partnership is too high.

     In connection with the Merry Land merger the Operating Partnership assumed
a line of credit facility in the amount of $120 million. Combined with the
Operating Partnership's existing line of credit the Operating Partnership has
total availability of $620 million. As of November 11, 1998, $400 million was
outstanding under these combined facilities.


Year 2000 Issue

     The year 2000 issue ("Year 2000") is the result of computer programs being
written using two digits rather than four to define the applicable year. Any of
the Operating Partnership's computer programs that have time-sensitive hardware
and software may recognize a date using "00" as the year 1900 rather than the
year 2000. This could result in a system failure or miscalculations causing
disruptions of operations, including, among other things, a temporary inability
to process transactions, collect rents, or engage in similar normal business
activities.

     The Operating Partnership believes that it has identified all of its
information technology ("IT") and non-IT systems to assess their Year 2000
readiness. Critical systems include, but are not limited to: accounts receivable
and rent collections, accounts payable and general ledger, human resources and
payroll (both property and corporate levels), cash management, fixed assets, all
IT hardware (such as desktop/laptop computers, data networking equipment,
telephone systems, fax machines, copy machines, etc.) and software, and property
environmental, health safety and security systems (such as elevators and alarm
systems).

     The Operating Partnership anticipates that previously scheduled system
upgrades to many of its IT systems will remediate any existing Year 2000
problems. The Operating Partnership is currently in the process of testing and
implementing the majority of its Year 2000 IT and non-IT system projects with
completion anticipated during the second quarter of 1999. The Operating
Partnership has estimated that the total Year 2000 project cost will approximate
$1 million, of which approximately 70% has been incurred as of September 30,
1998. This estimate is based on management's best estimates, which were derived
utilizing numerous assumptions of future events, and there can be no guarantees
that these estimates will be achieved.

     In some cases, various third party vendors have been queried on their Year
2000 readiness. The Operating Partnership continues to query its significant
suppliers and vendors to determine the extent to which the Operating
Partnership's interface systems are vulnerable to those third parties' failure
to remediate their own Year 2000 issues. To date, the Operating Partnership is
not aware of any significant suppliers or vendors with a Year 2000 issue that
would materially impact the Operating Partnership's results of operations,
liquidity, or capital


                                       26

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations (continued)

resources. However, there can be no assurances that the systems of other
companies, on which the Operating Partnership's systems rely, will be timely
converted and would not have an adverse effect on the Operating Partnership's
systems.

     Management of the Operating Partnership believes it has an effective
program in place to resolve the Year 2000 issue in a timely manner. In addition,
the Operating Partnership has commenced its contingency planning for critical
operational areas that might be affected by the Year 2000 issue if compliance by
the Operating Partnership is delayed. Aside from catastrophic failure of banks
or governmental agencies, the Operating Partnership believes that it could
continue its normal business operations if compliance by the Operating
Partnership is delayed. The Operating Partnership does not believe that the Year
2000 issue will materially impact its results of operations, liquidity or
capital resources.


Funds From Operations
 
     The Operating Partnership generally considers FFO to be one measure of the
performance of real estate companies. The resolution adopted by the Board of
Governors of NAREIT defines FFO as net income (loss) (computed in accordance
with GAAP), excluding gains (or losses) from debt restructuring and sales of
property, plus depreciation on real estate assets, and after adjustments for
unconsolidated partnerships and joint ventures. Adjustments for unconsolidated
partnerships and joint ventures are calculated to reflect FFO on the same basis.

     The Operating Partnership believes that FFO is helpful to investors as a
measure of the performance of a real estate company because, along with cash
flows from operating activities, financing activities and investing activities
it provides investors with an understanding of the ability of the Operating
Partnership to incur and service debt and to make capital expenditures. FFO in
and of itself does not represent cash generated from operating activities in
accordance with GAAP and therefore should not be considered an alternative to
net income as an indication of the Operating Partnership's performance or to net
cash flows from operating activities as determined by GAAP as a measure of
liquidity and is not necessarily indicative of cash available to fund cash
needs. The Operating Partnership's calculation of FFO represents net income,
excluding gains on dispositions of properties, plus depreciation on real estate
assets, amortization of deferred financing costs related to the Predecessor
Business and the allocation of net income to Cumulative Redeemable Preference
Units. The Operating Partnership's calculation of FFO may differ from the
methodology for calculating FFO utilized by other companies and, accordingly,
may not be comparable to such other companies.

     For the nine months ended September 30, 1998, FFO increased $132.8 million,
representing a 70.4% increase when compared to the nine months ended September
30, 1997. For the quarter ended September 30, 1998, FFO increased by $36.7
million representing a 48.2% increase when compared to the quarter ended
September 30, 1997.


                                       27

<PAGE>
 
                       ERP OPERATING LIMITED PARTNERSHIP

                                    PART I

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations (continued)

     The following is a reconciliation of net income to FFO for the nine months
and quarters ended September 30, 1998 and 1997:

<TABLE>
<CAPTION>
                                               Nine Months   Nine Months    Quarter    Quarter
                                                  Ended         Ended        Ended      Ended
                                                 9/30/98       9/30/97      9/30/98    9/30/97
                                               -----------   -----------   --------   --------
<S>                                            <C>           <C>           <C>        <C>
Net income                                      $194,734       $125,336    $ 61,102   $ 50,320
Adjustments:                                                                         
    Depreciation on real estate assets           204,401        104,288      75,014     42,403
    Amortization of deferred financing costs                                         
      related to predecessor business                 35            157          --         41
    Allocation of net income to Cumulative                                           
      Redeemable Preference Units                (65,075)       (37,287)    (21,691)   (16,348)
    Gain on disposition of properties            (12,717)        (3,923)     (1,625)      (291)
                                                ---------      --------    --------   --------
FFO                                             $321,378       $188,571    $112,800   $ 76,125
                                                =========      ========    ========   ========
</TABLE>


                                       28

<PAGE>
 
                          PART II. OTHER INFORMATION


Item 1. Legal Proceedings

     There have been no new or significant developments related to the legal
proceedings that were discussed in Part I, Item III of the Operating
Partnership's Form 10-K for the year ended December 31, 1997.
 
Item 4. Submission of Matters to a Vote of Security Holders

     The special shareholder meetings of both the General Partner of the 
Operating Partnership and Merry Land were held on October 15, 1998. At such 
meetings, the shareholders of the General Partner of the Operating Partnership 
and of Merry Land both voted to approve the merger of Equity Residential 
Properties and Merry Land and Investment, Inc.

Item 6.  Exhibits and Reports on Form 8-K

(A)  Exhibits:
 
12   Computation of Ratio of Earnings to Fixed Charges.


(B)  Reports on Form 8-K:

A Report on Form 8-K dated July 8, 1998, reporting information on the proposed
Merger with Merry Land and Investment Company, Inc.

A Report on Form 8-K dated July 23, 1998, reporting financial information of
Merry Land and Investment Company, Inc.

A Report on Form 8-K/A dated July 23, 1998, reporting additional financial
information of Merry Land and Investment Company, Inc.

A Report on Form 8-K dated August 11, 1998, relating to Ernst & Young LLP
consents to various 33 Act Registration Statements.


                                       29

<PAGE>
 
                                  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.


                                        ERP OPERATING LIMITED PARTNERSHIP
                                        BY: EQUITY RESIDENTIAL PROPERTIES TRUST,
                                        ITS GENERAL PARTNER


Date:   November 13, 1998               By:    /s/    Bruce C. Strohm
      ---------------------                 -----------------------------------
                                                      Bruce C. Strohm

                                                 Executive Vice President,
                                               General Counsel and Secretary



Date:   November 13, 1998               By:    /s/   Michael J. McHugh
      ---------------------                 -----------------------------------
                                                     Michael J. McHugh

                                              Executive Vice President, Chief
                                             Accounting Officer and Treasurer




                                       30