UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

                                    FORM 10-Q

(Mark one)

[x]                   QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
                      OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended            June 30, 1998
                               ----------------------------------------

                                       OR

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

For the transition period from _____________ to ______________

Commission File Number                        0-13400

                NTS-PROPERTIES V, a Maryland Limited Partnership
             (Exact name of registrant as specified in its charter)

           Maryland                                   61-1051452
(State or other jurisdiction of          (I.R.S. Employer Identification No.)
incorporation or organization)

    10172 Linn Station Road
    Louisville, Kentucky                                40223
(Address of principal executive                       (Zip Code)
offices)

Registrant's telephone number,
including area code                                (502) 426-4800

                                 Not Applicable
               Former name, former address and former fiscal year,
                          if changed since last report

Indicate by check mark whether the registrant (l) 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,  and (2) has been subject to such filing  requirements
for the past 90 days.

                                         YES  X         NO  ______

Exhibit Index: See page 19
Total Pages: 20





<PAGE>



                                TABLE OF CONTENTS


                                                                    Pages

                                     PART I

Item 1.     Financial Statements

            Balance Sheets and Statement of Partners' Equity
              As of June 30, 1998 and December 31, 1997                 3

            Statements of Operations
              For the three months and six months ended
              June 30, 1998 and 1997                                    4

            Statements of Cash Flows
              For the three months and six months ended
              June 30, 1998 and 1997                                    5

            Notes To Financial Statements                             6-9

Item 2.     Management's Discussion and Analysis of Financial
            Condition and Results of Operations                     10-18


                                     PART II

Item 3. Defaults Upon Senior Securities                                19

Item 6. Exhibits and Reports on Form 8-K                               19

Signatures                                                             20


                                      - 2 -

<PAGE>



PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements
<TABLE>

                                NTS-PROPERTIES V,
                         A Maryland Limited Partnership

                BALANCE SHEETS AND STATEMENT OF PARTNERS' EQUITY
<CAPTION>



                                                 As of            As of
                                            June 30, 1998   December 31, 1997*
                                            -------------   ------------------
<S>                                          <C>              <C>    
ASSETS

Cash and equivalents                         $   706,248      $   473,362
Cash and equivalents - restricted                334,785           69,858
Accounts receivable, net of allowance
 for doubtful accounts of $10,217 (1998)
 and $13,304 (1997)                              264,886          291,504
Land, buildings and amenities, net            23,317,989       23,750,773
Asset held for development, net                2,048,320        2,125,246
Asset held for sale                            1,152,868        1,152,868
Other assets                                     791,123          849,287
                                             -----------      -----------

                                             $28,616,219      $28,712,898
                                             ===========      ===========

LIABILITIES AND PARTNERS' EQUITY

Mortgages and note payable                   $21,268,566      $21,662,821
Accounts payable - operations                    299,908          284,829
Accounts payable - construction                   33,097           34,486
Security deposits                                187,137          167,597
Other liabilities                                502,534          189,570
                                             -----------      -----------

                                              22,291,242       22,339,303

Commitments and Contingencies

Partners' equity                               6,324,977        6,373,595
                                             -----------      -----------

                                             $28,616,219      $28,712,898
                                             ===========      ===========
</TABLE>
<TABLE>
<CAPTION>

                                      Limited        General
                                      Partners       Partner           Total
                                      --------       -------           -----
PARTNERS' EQUITY

<S>                                <C>             <C>             <C>    
Capital contributions, net of
 offering costs                    $ 30,582,037    $        100    $ 30,582,137
Net income (loss) - prior years      (8,554,517)         27,388      (8,527,129)
Net income - current year               128,018           1,293         129,311
Cash distributions declared to
 date                               (15,389,204)       (155,528)    (15,544,732)
Repurchase of limited
 partnership Units                     (314,610)          --           (314,610)
                                   ------------    ------------    ------------

Balances at June 30, 1998          $  6,451,724    $   (126,747)   $  6,324,977
                                   ============    ============    ============
</TABLE>
*Reference is made to the audited financial statements in the Form 10-K as filed
with the Commission on March 30, 1998.
                                      - 3 -

<PAGE>
<TABLE>


                                NTS-PROPERTIES V,
                         A Maryland Limited Partnership

                            STATEMENTS OF OPERATIONS

<CAPTION>



                                                                  Three Months Ended                        Six Months Ended
                                                                       June 30,                                 June 30,
                                                                  ------------------                        ----------------

                                                              1998                1997                 1998                1997
                                                          ------------         -----------          -----------         -----------



<S>                                                        <C>                 <C>                  <C>                 <C>    
REVENUES:
 Rental income                                             $ 1,655,016         $ 1,408,207          $ 3,242,388         $ 2,763,953
 Interest and other income                                      10,575               4,878               21,579              11,456
                                                           -----------         -----------          -----------         -----------

                                                             1,665,591           1,413,085            3,263,967           2,775,409

EXPENSES:
   Operating expenses                                          283,057             289,360              581,360             567,355
   Operating expenses - affiliated                             134,508             128,319              269,494             289,149
   Amortization of capitalized
   leasing costs                                                 3,701               5,203                7,404              10,404
   Interest expense                                            419,746             447,789              849,562             890,395
   Management fees                                              97,268              83,238              190,892             166,095
   Real estate taxes                                           122,455             133,564              267,913             273,562
   Professional and administrative
   expenses                                                     35,234              30,398               65,013              58,164
   Professional and administrative
   expenses - affiliated                                        52,175              58,022              108,659             114,372
   Depreciation and amortization                               376,024             411,574              794,359             829,891
                                                           -----------         -----------          -----------         -----------

                                                             1,524,168           1,587,467            3,134,656           3,199,387
                                                           -----------         -----------          -----------         -----------

Net income (loss)                                          $   141,423         $  (174,382)         $   129,311         $  (423,978)
                                                           ===========         ===========          ===========         ===========

Net income (loss) allocated to
  the limited partners                                     $   140,009         $  (172,638)         $   128,018         $  (419,738)
                                                           ===========         ===========          ===========         ===========
Net income (loss) per limited
  partnership unit                                         $      4.04         $     (4.91)         $      3.67         $    (11.95)
                                                           ===========         ===========          ===========         ===========
Weighted average number of
  limited partnership units                                     34,624              35,136               34,879              35,136
                                                           ===========         ===========          ===========         ===========

</TABLE>


                                      - 4 -

<PAGE>
<TABLE>


                                NTS-PROPERTIES V,
                         A Maryland Limited Partnership


                            STATEMENTS OF CASH FLOWS

<CAPTION>

                                                                       Three Months Ended                   Six Months Ended
                                                                            June 30,                            June 30,
                                                                       ------------------                   ----------------

                                                                   1998               1997               1998              1997
                                                               -----------        ------------       ------------       -----------
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                            <C>                <C>                <C>                <C>         
Net income (loss)                                              $   141,423        $  (174,382)       $   129,311        $  (423,978)
Adjustments to reconcile net income (loss)
  to net cash provided by operating
  activities:
   Amortization of capitalized leasing
     costs                                                           3,701              5,203              7,404             10,404
      Depreciation and amortization                                376,024            411,574            794,359            829,891
      Changes in assets and liabilities:
        Cash and equivalents - restricted                         (132,987)          (121,377)          (264,927)          (241,865)
        Accounts receivable                                        126,195             52,579             26,618             85,175
        Other assets                                                30,433             41,795             22,925             11,855
        Accounts payable - operations                              (58,675)           (39,345)            15,079             23,280
        Security deposits                                           24,810             10,742             19,540             21,611
        Other liabilities                                          130,041            147,251            312,966            292,332
                                                               -----------        -----------        -----------        -----------

   Net cash provided by operating
      activities                                                   640,965            334,040          1,063,275            608,705
                                                               -----------        -----------        -----------        -----------

CASH FLOWS FROM INVESTING ACTIVITIES
Additions to land, buildings and
  amenities                                                       (181,923)           (90,181)          (269,689)          (177,168)
                                                               -----------        -----------        -----------        -----------

   Net cash used in investing activities                          (181,923)           (90,181)          (269,689)          (177,168)
                                                               -----------        -----------        -----------        -----------

CASH FLOWS FROM FINANCING ACTIVITIES
Increases in mortgages and note payable                              --                 --               200,000              --
Principal payments on mortgages and note
  payable                                                         (306,731)          (262,345)          (594,255)          (522,156)
Decrease in loan costs                                               --                 --                11,485              --
Repurchase of limited partnership Units                           (177,930)             --              (177,930)             --
Cash and equivalents - restricted                                   30,000              --                 --                 --
                                                               -----------        -----------        -----------        -----------

   Net cash used in financing activities                          (454,661)          (262,345)          (560,700)          (522,156)
                                                               -----------        -----------        -----------        -----------

   Net increase (decrease) in cash and
      equivalents                                                    4,381            (18,486)           232,886            (90,619)

CASH AND EQUIVALENTS, beginning of period                          701,867            243,683            473,362            315,816
                                                               -----------        -----------        -----------        -----------

CASH AND EQUIVALENTS, end of period                            $   706,248        $   225,197        $   706,248        $   225,197
                                                               ===========        ===========        ===========        ===========

Interest paid on a cash basis                                  $   419,746        $   447,944        $   849,255        $   897,410
                                                               ===========        ===========        ===========        ===========



</TABLE>



                                      - 5 -

<PAGE>



                                NTS-PROPERTIES V,
                         A Maryland Limited Partnership

                          NOTES TO FINANCIAL STATEMENTS


The financial  statements included herein should be read in conjunction with the
Partnership's  1997 Annual Report.  In the opinion of the General  Partner,  all
adjustments (only consisting of normal recurring  accruals) necessary for a fair
presentation  have been made to the  accompanying  financial  statements for the
three months and six months ended June 30, 1998 and 1997.

1.     Use of Estimates in the Preparation of Financial Statements
       -----------------------------------------------------------

       The  preparation  of financial  statements in conformity  with  generally
       accepted accounting  principles requires management to make estimates and
       assumptions  that affect the reported  amounts of assets and  liabilities
       and  disclosure of contingent  assets and  liabilities at the date of the
       financial  statements  and the reported  amounts of revenues and expenses
       during the  reporting  period.  Actual  results  could  differ from those
       estimates.

2.    Cash and Equivalents - Restricted
      ---------------------------------

      Cash  and  equivalents  -  restricted  represents  1) funds  received  for
      residential  security  deposits,  2) funds which have been  escrowed  with
      mortgage  companies  for  property  taxes  in  accordance  with  the  loan
      agreements and 3) funds reserved by the  Partnership for the repurchase of
      limited partnership Units.

3.    Interest Repurchase Reserve
      ---------------------------

      Pursuant  to  Section  16.4  of the  Partnership's  Amended  and  Restated
      Agreement of the Limited  Partnership,  the Partnership has established an
      Interest  Repurchase Reserve. On January 16, 1998, the Partnership elected
      to  resume  the  Repurchase  Program  and  fund  $30,000  to the  Interest
      Repurchase  Reserve.  On April 7, 1998, the Partnership elected to fund an
      additional $30,000 to the Interest Repurchase Reserve and on May 12, 1998,
      funded an additional  $11,850.  With these funds, the Partnership was able
      to repurchase 479 additional Units at a price of $150 per Unit. On May 26,
      1998, the Partnership  elected to fund $96,000 to the Interest  Repurchase
      Reserve and on June 1, 1998, the Partnership elected to fund an additional
      $10,080.  With the May 26 and June 1, 1998 fundings,  the  Partnership was
      able to  repurchase  663 Units at a price of $160 per Unit.  The  offering
      prices per Unit mentioned above were established by the General Partner in
      its sole  discretion and do not purport to represent the fair market value
      or  liquidation  value of the Unit.  From  June 28,  1996  (date  Interest
      Repurchased Reserve was established) to June 30, 1998, the Partnership had
      repurchased  a total of 1,882 Units for  $277,830.  Repurchased  Units are
      retired by the Partnership, thus increasing the percentage of ownership of
      each limited partner remaining  investor.  The Interest Repurchase Reserve
      was funded from cash reserves.  The balance in the  repurchase  reserve at
      June 30, 1998 was $100.














                                      - 6 -

<PAGE>



4.    Mortgages and Note Payable
      --------------------------

      Mortgages and note payable consist of the following:


                                               June 30,             December 31,
                                                 1998                   1997
                                               --------             ------------
      Mortgage payable with an insurance 
      company,  bearing interest at a fixed 
      rate of 7.65%, due February 1, 2008,
      secured by land and building          $  4,436,534           $  4,588,807

      Mortgage payable with an insurance
      company, bearing interest at a fixed
      rate of 8.125%, due August 1, 2008,
      secured by land and building             3,764,675              3,881,569

      Mortgage payable with an insurance
      company, bearing interest at a fixed
      rate of 8.125%, due August 1, 2008,
      secured by land and building             3,608,464              3,720,508

      Mortgage payable with an insurance
      company, bearing interest at a fixed
      rate of 8.125%, due August 1, 2008,
      secured by land and building             3,499,117              3,607,766

      Mortgage payable with an insurance
      company, bearing interest at a fixed
      rate of 7.2% due January 5, 2013,
      secured by land, buildings and
      amenities                                2,824,213              2,871,146

      Mortgage payable with an insurance
      company, bearing interest at a fixed
      rate of 7.2% due January 5, 2013,
      secured by land, buildings and
      amenities                                1,686,744              1,714,774

      Note payable to a bank, bearing
      interest at the Prime Rate, due
      February 1, 2009, secured by land
      and building                             1,448,819              1,278,251
                                             -----------            -----------

                                            $ 21,268,566           $ 21,662,821
                                             ===========            ===========

      The Prime Rate was 8.5% at June 30, 1998 and at December 31, 1997.

      Based on the borrowing  rates  currently  available to the Partnership for
      mortgages  with  similar  terms,  the  fair  value  of  long-term  debt is
      approximately $21,300,000.

5.    Related Party Transactions
      --------------------------

      Pursuant to an agreement with the Partnership, property management fees of
      $190,892  and  $166,095  for the six months  ended June 30, 1998 and 1997,
      respectively,  were paid to NTS Development  Company,  an affiliate of the
      General  Partner  of the  Partnership.  The fee is  equal  to 5% of  gross
      revenues  from  residential  properties  and  6% of  gross  revenues  from
      commercial  properties.  Also  pursuant to an agreement,  NTS  Development
      Company will receive a repair and  maintenance  fee equal to 5.9% of costs
      incurred  which  relate  to  capital  improvements.  The  Partnership  has
      incurred  $18,505 and $11,447 as a repair and  maintenance  fee during the
      three  months  ended  June  30,  1998  and  1997,  respectively,  and  has
      capitalized this cost as part of land, buildings and amenities.




                                      - 7 -

<PAGE>



5.    Related Party Transactions - Continued
      --------------------------------------

      As  permitted  by an  agreement,  the  Partnership  also was  charged  the
      following  amounts from NTS  Development  Company for the six months ended
      June 30,  1998 and 1997.  These  charges  include  items  which  have been
      expensed  as  operating   expenses  -  affiliated  or   professional   and
      administrative  expenses  affiliated and items which have been capitalized
      as other assets or as land, buildings and amenities.



                                              1998                   1997
                                           ---------              ---------
          Administrative                   $ 136,730              $ 144,777
          Leasing                            101,051                116,684
          Property manager                   169,264                174,326
          Other                                7,656                  1,750
                                            --------               --------

                                           $ 414,701              $ 437,537
                                            ========               ========

6.    Commitment and Contingencies
      ----------------------------

      As of June 30, 1998, the  Lakeshore/University II ("L/U II") Joint Venture
      has a  commitment  for a $450,000  special  tenant  finish  allowance as a
      result of lease negotiations with Full Sail Recorders, Inc. ("Full Sail").
      Full Sail currently occupies 83% of University  Business Center Phase II's
      net rentable area.  Approximately  $92,000 of the total allowance is to be
      reimbursed by Full Sail to the L/U II Joint Venture  pursuant to the lease
      terms.  The  Partnership's  proportionate  share  of  the  net  commitment
      ($450,000  less  $92,000) is  approximately  $247,000  or 69%.  The tenant
      allowance  will be due and  payable  to Full  Sail  pursuant  to the lease
      agreements,  as  appropriate  invoices for tenant finish costs incurred by
      Full Sail are submitted to the L/U II Joint  Venture.  The source of funds
      for this  commitment  is expected to be cash flow from  operations  and/or
      cash reserves.

      On  December  30,  1997,  Full  Sail  delivered   written  notice  to  the
      Partnership  that Full Sail had (i)  exercised  its right of first refusal
      under its lease with  NTS-Properties  V to  purchase  University  Business
      Center Phase I  ("University  I")office  building and the Phase III vacant
      land adjacent to the  University  Business  Center  development,  and (ii)
      exercised its right of first  refusal under its lease with NTS  University
      Boulevard  Joint Venture to purchase  University  Business Center Phase II
      ("University  II")office building, for an aggregate purchase price for all
      three of $18,700,000. Because no binding agreement exists for the purchase
      of the  properties at this time,  there can be no assurance  that a mutual
      agreement of purchase and sale will be reached among the parties, nor that
      the sale of the properties will be  consummated.  As such, the Partnership
      has not determined the use of net proceeds after  repayment of outstanding
      debt from any such sale nor has it  determined  the  impact on its  future
      results of  operations  or financial  position.  The  University II office
      building is owned by the L/U II Joint  Venture,  the  successor to the NTS
      University  Boulevard Joint Venture,  in which the Partnership  owns a 69%
      joint venture interest. Under the terms of the right of first refusal, the
      closings  of the sale of  University  I,  University  II and the Phase III
      vacant land are to occur simultaneously.

      As of June 30, 1998, Lakeshore Business Center Phase I had a commitment of
      approximately  $111,000 of tenant  finish  improvements  resulting  from a
      3,049  square  foot  expansion  by a  current  tenant.  The  Partnership's
      proportionate share of the commitment is approximately $77,000 or 69%. The
      project is expected to be completed  during the third quarter of 1998. The
      source  of  funds  for this  project  is  expected  to be cash  flow  from
      operations and/or cash reserves.


                                      - 8 -

<PAGE>



7.    Subsequent Event
      ----------------

      Subsequent  to June 30,  1998,  the L/U II Joint  Venture  entered  into a
      contract for the sale of  approximately  2.4 acres of land adjacent to the
      Lakeshore  Business  Center  development for a purchase price of $528,405.
      Concurrent with the signing of the contract,  the purchaser deposited into
      an escrow  account  $10,000.  This deposit will be applied to the purchase
      price at closing.  The purchaser has until  November 17, 1998 to determine
      if the land is  satisfactory  for their use. If the  purchaser  determines
      that it is satisfactory, the contract requires that they proceed, at their
      cost, to have the property re-zoned to allow for a self-storage  facility.
      If the  purchaser is unable to obtain the  re-zoning,  they may cancel the
      contract.  The  General  Partner  of the  Partnership  has met  with  city
      officials who seem interested in the project and have voiced a willingness
      to consider  the  re-zoning  request.  If the  re-zoning  is granted,  the
      purchaser  is to close on the  property  by February 1, 1999 or deposit an
      additional  $10,000 with the escrow agent for a 30-day delay. The contract
      also  allows for an  additional  deposit of $10,000  for one more delay in
      closing to April 3, 1999. The  Partnership has a 69% interest in the Joint
      Venture.  The  Partnership  has not  yet  determined  what  the use of net
      proceeds would be from the sale of the land.


                                      - 9 -

<PAGE>



Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         ---------------------------------------------------------------
         RESULTS OF OPERATIONS
         ---------------------

Management's  discussion  and  analysis of  financial  condition  and results of
operations  included herein should be read in conjunction with the Partnership's
1997 Annual Report.

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

The  occupancy  levels  at the  Partnership's  properties  as of June 30 were as
follows:


                                                      1998             1997
                                                      ----             ----
Wholly-owned Properties
-----------------------

Commonwealth Business Center Phase II                   77%              73%

University Business Center Phase I                     100%             100%

Property Owned in Joint Venture
with NTS-Properties IV (Ownership
% at June 30, 1998)
---------------------------------

The Willows of Plainview Phase II (90%)                 83%              94%

Properties Owned Through Lakeshore/
University II Joint Venture (L/U II
Joint Venture) (Ownership % at
June 30, 1998)
------------------------------------

Lakeshore Business Center Phase I (69%)                 94%              97%

Lakeshore Business Center Phase II (69%)                92%              94%

University Business Center Phase II (69%)               90%              99%

The rental and other income  generated by the  Partnership's  properties for the
three months and six months ended June 30, 1998 and 1997 was as follows:


                                        Three Months Ended   Six Months Ended
                                             June 30,            June 30,
                                             --------            --------

                                      1998         1997        1998       1997
                                     ------       ------      ------     ------
Wholly-owned Properties
-----------------------

Commonwealth Business Center
  Phase II                          $ 152,890    $ 122,750  $ 313,459  $ 263,578

University Business Center Phase I  $ 389,899    $ 379,815  $ 782,175  $ 769,235

Property Owned in Joint Venture
with NTS-Properties IV (Ownership
% at June 30, 1998)
---------------------------------

The Willows of Plainview
  Phase II (90%)                    $ 289,293    $ 308,835  $ 584,077  $ 597,381




                              (Continued next page)
                                     - 10 -

<PAGE>


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

                                  Three Months Ended        Six Months Ended
                                       June 30,                 June 30,
                                  ------------------        ----------------
                                      
                                   1998       1997         1998          1997
                                   -----     ------       ------        -----

Properties Owned Through
Lakeshore/University II Joint
Venture (L/U II Joint Venture)
(Ownership % at June 30, 1998)
------------------------------

Lakeshore Business Center
  Phase I (69%)                 $ 255,375  $ 241,617    $ 577,177    $ 486,526

Lakeshore Business Center       $ 377,879  $ 247,402    $ 662,678    $ 477,261
  Phase II (69%)

University Business Center      $ 196,750  $ 111,303    $ 337,172    $ 176,499
  Phase II (69%)

Revenues shown in the table above for  properties  owned through a joint venture
represent only the Partnership's percentage interest in those revenues.

The 4% increase in occupancy at Commonwealth  Business Center Phase II from June
30,  1997  to  June  30,  1998,  is  a  result  of  seven  new  leases  totaling
approximately  15,600 square feet.  Partially  offsetting the new leases are two
move-outs  totaling  12,900 square feet.  This total  represents two tenants who
vacated  at the end of the lease  term.  Average  occupancy  increased  from 68%
(1997) to 77% (1998) for the three  months  ended June 30 and from 72% (1997) to
77% (1998) for the six months  ended June 30. The  increase  in rental and other
income at  Commonwealth  Business  Center  Phase II for the three months and six
months  ended June 30, 1998 as compared to the same  periods in 1997 is a result
of the  increase in average  occupancy  and an  increase in common area  expense
reimbursements.  Tenants at Commonwealth  Business Center Phase II reimburse the
Partnership for common area expenses as part of the lease agreements.

Occupancy at University Business Center I was 100% at June 30, 1997 and June 30,
1998. Average occupancy at University  Business Center Phase I remained constant
at 100% for the three  months and six months  ended  June 30.  The  increase  in
rental and other  income at  University  Business  Center  Phase I for the three
months and six months  ended June 30, 1998 as  compared  to the same  periods in
1997 is primarily  due to increased  rental rates on lease  renewals  during the
twelve month period.

The Willows of Plainview  Phase II's  occupancy  decreased  from 94% at June 30,
1997 to 83% at June 30, 1998. Average occupancy decreased from 94% (1997) to 83%
(1998) for the three  months ended June 30 and from 91% (1997) to 84% (1998) for
the six months  ended  June 30. In the  opinion  of the  General  Partner of the
Partnership,  the decrease in occupancy at The Willows of Plainview  Phase II is
only a temporary  fluctuation and does not represent a downward occupancy trend.
Occupancy at residential  properties  fluctuates on a continuous basis.  Period-
ending  occupancy  percentages  represent  occupancy  only on a  specific  date;
therefore, it is more meaningful to consider average occupancy percentages which
are  representative of the entire period's  results.  The decrease in rental and
other income at The Willows of  Plainview  Phase II for the three months and six
months  ended June 30, 1998 as compared to the same periods in 1997 is primarily
due to a decrease in average occupancy.  The decrease in rental and other income
at The  Willows of  Plainview  Phase II is  partially  offset by an  increase in
income from fully-furnished  units.  Fully-furnished  units are apartments which
rent at an  additional  premium above base rent.  Therefore,  it is possible for
average  occupancy  to decrease  and  revenues  to  increase  when the number of
fully-furnished units has increased.

The 3% decrease in occupancy at Lakeshore  Business Center Phase I from June 30,
1997 to June  30,  1998  can be  attributed  to six  tenant  move-outs  totaling
approximately 6,100 square feet. One of the six tenants vacated prior to the end
of the lease term. The write-off of accrued income connected with this lease was
not significant. The move-outs are partially offset by two new leases totaling

                                     - 11 -

<PAGE>



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

approximately  2,600 square feet. Average occupancy at Lakeshore Business Center
Phase I decreased  from 96% (1997) to 93% (1998) for the three months ended June
30 and from 95% (1997) to 94% (1998) for the six month  period.  The increase in
rental and other income at Lakeshore  Business Center Phase I for the six months
ended June 30,  1998 as  compared  to the six months  ended June 30, 1997 is due
primarily  to  a  $61,000   lease   buy-out   received  in  February  1998  (the
Partnership's  proportionate  share is approximately  $42,000 or 69%). The lease
buy-out  income was received from a tenant whose lease expires during July 1999;
however,  the tenant has notified the Partnership  that it will vacate the space
at the end of 1998 due to the fact that it will be consolidating  several of its
regional  offices.  The  increase  in rental and other  income for the six month
period is also due to an increase in common area expense reimbursements. Tenants
at the business  center  reimburse the  Partnership  for common area expenses as
part of the lease agreements.  The increase in rental income for the three month
period  ended  June  30,  1998 as  compared  to the same  period  in 1997 is due
primarily to an increase in common area expense reimbursements.

As of June 30, 1998,  Lakeshore Business Center Phase I has 3,049 square feet of
additional  space leased to an existing  tenant.  The tenant is expected to take
occupancy of the  expansion  space during the third  quarter of 1998.  With this
expansion  the  Business  Center's  occupancy  should  improve  to 96%.  See the
Liquidity  and  Capital  Resources  Section of this item for the  tenant  finish
commitment related to this lease.

The 2% decrease in occupancy at Lakeshore Business Center Phase II from June 30,
1997 to June  30,  1998  can be  attributed  to two  tenant  move-outs  totaling
approximately  11,000 square feet. The move-outs  consist of one tenant vacating
at the end of the lease term (1,200  square feet) and one tenant  negotiating  a
lease  termination  (10,000 square feet - tenant paid the L/U II Joint Venture a
lease  termination  fee  {recorded  as rental  income} of  $185,000 of which the
Partnership's  proportionate share is approximately  $128,000 or 69%). Partially
offsetting the move-outs are four new leases totaling approximately 9,000 square
feet which  includes  three  expansions  of  approximately  5,000 square feet by
existing tenants.  4,000 square feet of the expansions represents an increase in
the square  footage  leased by Lambda  Physik.  Lambda Physik  currently  leases
nearly  15,000 square feet and is the largest  tenant in the building  occupying
approximately  15%  of  the  building's  total  rentable  square  feet.  Average
occupancy at Lakeshore Business Center Phase II increased from 94% (1997) to 95%
(1998) for the three months ended June 30 and  increased  from 92% (1997) to 97%
(1998) for the six month  period.  The  increase  in rental and other  income at
Lakeshore  Business  Center  Phase II for the three  months and six months ended
June 30, 1998 as compared to the same  periods in 1997 is due  primarily  to the
$185,000  termination  fee paid to the L/U II Joint Venture as discussed  above.
Also  contributing  to the increase in rental and other income is an increase in
average occupancy and an increase in common area expense reimbursements. Tenants
at the Business  Center  reimburse the  partnership  for common area expenses as
part of the lease agreements.

The 9% decrease in occupancy at  University  Business  Center Phase II from June
30,  1997 to June 30,  1998 is the  result of one of Philip  Crosby  Associates,
Inc's  ("Crosby")  sub-tenants  (approximately  9,000 square feet)  vacating its
space at the end of  Crosby's  lease term  (March 31,  1998).  The  move-out  is
partially  offset by an expansion of  approximately  1,300 square feet by one of
Crosby's  subtenants,   Full  Sail  Recorders,  Inc.  ("Full  Sail"),  upon  the
commencement (April 1, 1998) of its lease with the L/U II Joint Venture. In 1995
and  1996  Full  Sail  had  signed   leases  with  the  Joint  Venture  for  the
approximately  73,000  square  feet it was leasing  from  Crosby.  These  leases
commenced April 1, 1998. (See below for a discussion  regarding  Crosby and Full
Sail).  Average occupancy at University  Business Center Phase II decreased from
99% (1997) to 90% (1998) for the three months ended June 30 and  decreased  from
99% (1997) to 95% (1998) for the six month  period.  The  increase in rental and
other  income at  University  Business  Center Phase II for the six months ended
June 30, 1998 as compared  to the same  period in 1997 is  primarily  due to the
fact that  approximately  $70,000 of accrued  income  connected  with the Crosby
lease  was  written-off   during  the  first  quarter  of  1997,  of  which  the
Partnership's proportionate share was approximately $48,000 or 69%. The increase
in rental and other income at University  Business Center Phase II for the three
months ended June 30, 1998 as compared to the same period in 1997 is a result of
an increase in common area

                                     - 12 -

<PAGE>



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

expense reimbursements.  Sub-tenants at the business center were not required to
reimburse the  Partnership  for common area expenses.  However,  as part of Full
Sail's lease agreement,  which commenced April 1, 1998, Full Sail is required to
reimburse the  Partnership  for such  expenses,  attributing  to the increase in
rental and other income for the second quarter of 1998.

Philip Crosby Associates,  Inc. ("Crosby")  previously leased 100% of University
Business  Center Phase II, which is owned by the  Lakeshore/University  II ("L/U
II") Joint Venture.  The original lease term was for seven years, and the tenant
took occupancy in April 1991.  During 1994,  1995 and 1996,  Crosby  sub-leased,
through the end of their lease term, approximately 85,000 square feet (including
approximately  10,000  square feet of mezzanine  space) of  University  Business
Center Phase II's  approximately  88,000  square feet of net  rentable  area (or
96%). Of the total being sub-leased,  approximately  73,000 square feet (or 86%)
was  leased  by Full Sail  Recorders,  Inc.  ("Full  Sail"),  a major  tenant at
University Business Center Phase I, a neighboring property owned by an affiliate
of the  General  Partner of the  Partnership.  During  this  period and  through
December 1996,  Crosby continued to make rent payments  pursuant to the original
lease terms.  During 1996, the Joint Venture received notice that Crosby did not
intend to pay full rental due under the original lease agreement,  including and
subsequent to January 1997. The Partnership's  proportionate share of the rental
income from this property  accounted for  approximately 15% of the partnership's
total revenues during 1996. Although the Joint Venture did not have formal lease
agreements  with the  sub-lessees  noted  above  during this  period,  beginning
February 1997 and through  March 31, 1998 rent  payments from these  sub-lessees
were made directly to the Joint Venture.

In cases of tenants who cease making rental  payments or abandon the premises in
breach of their lease,  the Partnership  pursues  collection  through the use of
collection agencies or other remedies available by law when practical.  In cases
where tenants have vacated as a result of bankruptcy,  the Partnership has taken
legal action when it was thought there could be possible collection.  There have
been no funds recovered as a result of these actions during the six months ended
June 30, 1998 and 1997.

Current  occupancy  levels are considered  adequate to continue the operation of
the Partnership's  properties without the need of any additional financing.  See
the  Liquidity  and  Capital  Resources  section  of this item for a  discussion
regarding the cash requirements of the Partnership's current debt financings.

Interest and other income includes income from  short-term  investments  made by
the Partnership with cash reserves.  Interest and other income increased for the
three  months and six months ended June 30, 1998 as compared to the same periods
in 1997  primarily  as a result of an increase in cash  reserves  available  for
investment.

Operating  expenses  for the three  months and six months ended June 30, 1998 as
compared to the same periods in 1997 remained fairly constant.

The  decrease in operating  expenses - affiliated  for the six months ended June
30, 1998 as compared to the same period in 1997 is due  primarily  to  decreased
leasing costs at Commonwealth  Business  Center Phase II and decreased  property
management costs at all of the Partnership's  properties except for Commonwealth
Business  Center Phase II. The increase in operating  expenses - affiliated  for
the three months ended June 30, 1998 as compared to the same period in 1997 is a
result of increased  administrative  costs and property maintenance costs at The
Willows of Plainview Phase II, and increased leasing costs at Lakeshore Business
Center Phases I and II.  Operating  expenses - affiliated are expenses  incurred
for services performed by employees of NTS Development  Company, an affiliate of
the General Partner of the Partnership.

Amortization  of  capitalized  leasing costs for the three months and six months
ended June 30,  1998 as  compared to the same  periods in 1997  remained  fairly
constant.


                                     - 13 -

<PAGE>



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

The decrease in interest  expense for the three months and six months ended June
30,  1998 as  compared to the same  periods in 1997 is  primarily  the result of
continued   principal  payments  on  the  mortgages  and  note  payable  of  the
Partnership and its Joint Venture  properties.  The decrease is partially offset
by an additional  draw of $200,000  from a note payable in  accordance  with the
terms of the note. See the Liquidity and Capital  Resources section of this item
for details regarding the Partnership's debt.

Management  fees are  calculated as a percentage of cash  collections,  however,
revenue  for  reporting  purposes  is on the  accrual  basis.  As a result,  the
fluctuations of revenues  between  periods will differ from the  fluctuations of
management fee expense.

The decrease in real estate taxes for the three months and six months ended June
30, 1998 as compared to the same  periods in 1997 is primarily a result of a tax
refund received by Lakeshore Business Center Phase I for 1997 real estate taxes.
The decrease is partially offset by increased property  assessments at Lakeshore
Business Center Phases I and II.

The change in professional  and  administrative  expenses and  professional  and
administrative  expenses - affiliated  for the three months and six months ended
June 30,  1998 as  compared  to the same  periods  in 1997 was not  significant.
Professional and administrative  expenses - affiliated are expenses incurred for
services performed by employees of NTS Development  Company, an affiliate of the
General Partner.

Depreciation and amortization  expense for the three months and six months ended
June 30, 1998 as compared to the same periods in 1997 decreased primarily due to
a portion of the  Partnership's  assets  having  become fully  depreciated.  The
decrease  is  partially  offset by the  addition  of fixed  assets at  Lakeshore
Business Center Phase I,  Commonwealth  Business Center Phase II and The Willows
of Plainview Phase II.  Depreciation is computed using the straight-line  method
over the  estimated  useful  lives of the assets which are 5 - 30 years for land
improvements, 30 years for buildings, 5 - 30 years for building improvements and
5 - 30 years for amenities.  The aggregate cost of the Partnership's  properties
for Federal tax purposes is approximately $40,000,000.

Liquidity and Capital Resources
-------------------------------

As of June 30,  1998,  the  Partnership  had a mortgage  loan with an  insurance
company in the amount of  $4,436,534.  The  mortgage  payable is due February 1,
2008,  bears  interest  at a fixed rate of 7.65% and is  secured  by  University
Business  Center  Phase I.  Monthly  principal  payments  are based on a 12-year
amortization  schedule. At maturity, the mortgage will have been repaid based on
the current rate of amortization.

As of June 30, 1998,  the L/U II Joint Venture had three  mortgage loans with an
insurance company.  The outstanding  balances of the loans at June 30, 1998 were
$5,437,925,  $5,212,284 and $5,054,336 for a total of $15,704,545. The loans are
recorded as a liability of the Joint Venture.  The  Partnership's  proportionate
share in the loans at June 30, 1998 was  $3,764,675,  $3,608,464  and $3,499,117
respectively, for a total of $10,872,256. The mortgages bear interest at a fixed
rate of 8.125%,  are due August 1,  2008,  and are  secured by the assets of the
Joint Venture.  Monthly principal payments are based upon a 12-year amortization
schedule. At maturity, the loans will have been repaid based on the current rate
of amortization.

As of June 30,  1998,  The Willows of Plainview  Phase II Joint  Venture had two
mortgage  loans each with an insurance  company in the amount of $3,142,903  and
$1,877,080.  The mortgages are recorded as a liability of the Joint Venture. The
Partnership's  proportionate  share of the  mortgages  as of June  30,  1998 was
$4,510,957 ($2,824,213 and $1,686,744).  Both mortgages are due January 5, 2013,
currently  bear  interest  at a fixed rate of 7.2% and are  secured by the land,
buildings and amenities of the Joint Venture. Current monthly principal payments
on both mortgages are based upon a 15-year amortization  schedule.  At maturity,
the note will have been repaid based on the current rate of amortization.


                                     - 14 -

<PAGE>



Liquidity and Capital Resources - Continued
-------------------------------------------

As of June 30,  1998,  the  Partnership  had a note  payable  with a bank in the
amount  of  $1,448,819.  On  February  1,  1998,  the  Partnership  received  an
additional  $200,000 funding from this note payable in accordance with the terms
of the loan agreement.  The note payable is due February 1, 2009, bears interest
at the Prime Rate and is  secured  by  Commonwealth  Business  Center  Phase II.
Monthly  principal  payments are based on a 13-year  amortization  schedule.  At
maturity,  the  note  will  have  been  repaid  based  on the  current  rate  of
amortization.

Cash provided by operating  activities  was  $1,063,275 and $608,705 for the six
months  ended June 30, 1998 and 1997,  respectively.  No  distribution  has been
declared since March 31, 1994.  The  Partnership  plans to resume  distributions
once the Partnership has established adequate cash reserves, which would include
funds for future tenant finish  improvements,  and the cash flow from operations
is sufficient,  in management's  opinion,  to pay  distributions.  Cash reserves
(which  are  unrestricted  cash and  equivalents  as shown on the  Partnership's
balance  sheet at June 30) were $706,248 and $225,197 at June 30, 1998 and 1997,
respectively.

The  majority  of  the  Partnership's   cash  flow  is  derived  from  operating
activities.  Cash  flows used in  investing  activities  are for  tenant  finish
improvements  and for  other  capital  additions  and are  funded  by  operating
activities.  Changes to current tenant finish improvements are a typical part of
any lease negotiation.  Improvements generally include a revision to the current
floor plan to  accommodate  a tenant's  needs,  new  carpeting  and paint and/or
wallcovering.  The extent and cost of these  improvements  are determined by the
size of the space and whether the  improvements are for a new tenant or incurred
because of a lease renewal. Cash flows provided by financing activities are from
a decrease in loan costs  (refund of  application  fee) and from a debt  funding
received in 1998 (loan  secured by the assets of  Commonwealth  Business  Center
Phase II). Cash flows used in financing activities are for principal payments on
mortgages and note payable and cash which has been  reserved by the  Partnership
for the repurchase of limited partnership Units. The Partnership does not expect
any material changes in the mix and relative cost of capital resources.

The  primary  source of future  liquidity  and  distributions  is expected to be
derived from cash generated by the Partnership's  properties after adequate cash
reserves are  established  for future  leasing  costs,  tenant  finish costs and
capital improvements.

Due to the fact that no distributions were made during the six months ended June
30, 1998 and 1997,  the table which  presents  that portion of the  distribution
that represents a return of capital on a Generally Accepted Accounting Principle
basis has been omitted.

As of June 30, 1998, the  Lakeshore/University II ("L/U II") Joint Venture has a
commitment for a $450,000  special tenant finish  allowance as a result of lease
negotiations with Full Sail Recorders,  Inc. ("Full Sail").  Full Sail currently
occupies  83% of  University  Business  Center  Phase  II's net  rentable  area.
Approximately $92,000 of the total allowance is to be reimbursed by Full Sail to
the  L/U II  Joint  Venture  pursuant  to the  lease  terms.  The  Partnership's
proportionate   share  of  the  net   commitment   ($450,000  less  $92,000)  is
approximately  $247,000 or 69%. The tenant  allowance will be due and payable to
Full Sail pursuant to the lease agreements,  as appropriate  invoices for tenant
finish costs  incurred by Full Sail are  submitted to the L/U II Joint  Venture.
The  source  of funds  for this  commitment  is  expected  to be cash  flow from
operations and/or cash reserves.

The Partnership has conducted a comprehensive  review of its computer systems to
identify  the  systems  that  could be  affected  by the Year 2000  Issue and is
developing an  implementation  plan to resolve the issue. The Year 2000 Issue, a
worldwide  problem,  is the result of computer  programs being written using two
digits rather than four to define the applicable year. Any of the  Partnership's
programs  that have  time-sensitive  software may recognize a date using "00" as
the year 1900  rather  than the year 2000.  This could  result in major  systems
failures or  miscalculations.  The  Partnership  presently  believes that,  with
modifications

                                     - 15 -

<PAGE>



Liquidity and Capital Resources - Continued
-------------------------------------------

to existing software and conversions to new software, the Year 2000 problem will
not  pose  significant  operational  problems  for  the  Partnership's  computer
systems. The Partnership continues to evaluate appropriate courses of corrective
action, including replacement of certain systems whose associated costs would be
recorded  as assets and  amortized.  The  Partnership  does not expect the costs
associated  with the resolution of the Year 2000 Issue to have a material effect
on its financial position or results of operations. The associated costs will be
funded by cash flow from  operations and cash reserves.  The amount  expensed in
1998 was immaterial.

As of June 30, 1998,  Lakeshore  Business  Center  Phase I had a commitment  for
approximately  $111,000 of tenant  finish  improvements  resulting  from a 3,049
square foot expansion by a current tenant. The Partnership's proportionate share
of the commitment is approximately $77,000 or 69%. The project is expected to be
completed during the third quarter of 1998. The source of funds for this project
is expected to be cash flow from operations and/or cash reserves.

The  Partnership  had no other material  commitments  for renovations or capital
improvements at June 30, 1998.

In the next twelve  months,  the demand on future  liquidity is  anticipated  to
increase  as a result  of the  commitments  made  for a  special  tenant  finish
allowance(see  discussions  above).  The Partnership  also expects the demand on
future  liquidity  to  increase  as a  result  of  future  leasing  activity  at
Commonwealth  Business Center Phase II, University  Business Center Phases I and
II and  Lakeshore  Business  Center  Phases I and II. At this  time,  the future
leasing  and tenant  finish  costs  which will be  required to renew the current
leases or obtain new tenants are unknown.  It is anticipated  that the cash flow
from  operations  and cash  reserves will be sufficient to meet the needs of the
Partnership.

The Partnership  also  anticipates a demand of future liquidity as a result of a
planned renovation of the community's clubhouse at The Willows of Plainview.  At
this time, the cost and extent of the renovation  has not been  determined.  The
cost of the common clubhouse renovation will be shared  proportionately by Phase
I and Phase II of The Willows of Plainview. The source of funds for this project
will be cash flow from operations and/or cash reserves.

Pursuant to Section 16.4 of the Partnership's  Amended and Restated Agreement of
the Limited Partnership,  the Partnership has established an Interest Repurchase
Reserve.  On January 16, 1998, the Partnership  elected to resume the Repurchase
Program and fund an additional $30,000 to the Interest  Repurchase  Reserve.  On
April  7,  1998,  the  Partnership  elected  to  fund  $30,000  to the  Interest
Repurchase Reserve and on May 12, 1998, funded an additional $11,850. With these
funds, the Partnership was able to repurchase 479 additional Units at a price of
$150 per Unit. On May 26, 1998, the  Partnership  elected to fund $96,000 to the
Interest Repurchase Reserve and on June 1, 1998, the Partnership elected to fund
an  additional  $10,080.  With  the  May 26  and  June  1,  1998  fundings,  the
Partnership  was able to repurchase  663 Units at a price of $160 per Unit.  The
offering prices per Unit mentioned above were established by the General Partner
in its sole  discretion and do not purport to represent the fair market value or
liquidation  value of the Unit.  From June 28, 1996 (date  Interest  Repurchased
Reserve was  established)  to June 30, 1998, the  Partnership  had repurchased a
total  of 1,882  Units  for  $277,830.  Repurchased  Units  are  retired  by the
Partnership, thus increasing the percentage of ownership of each limited partner
remaining  investor.  The  Interest  Repurchase  Reserve  was  funded  from cash
reserves. The balance in the repurchase reserve at June 30, 1998 was $100.

The following  describes the efforts being taken by the  Partnership to increase
the occupancy levels at the Partnership's  properties.  At Commonwealth Business
Center  Phase II, the leasing and  renewal  negotiations  are handled by leasing
agents, employees of NTS Development Company,  located in Louisville,  Kentucky.
The leasing agents are located in the same city as the property. All advertising
is  coordinated  by  NTS  Development   Company's  marketing  staff  located  in
Louisville,  Kentucky.  At  University  Business  Center  Phase  II in  Orlando,
Florida,  the  Partnership  has an on-site  leasing  agent,  an  employee of NTS
Development Company, who makes calls to potential tenants, negotiates lease

                                     - 16 -

<PAGE>



Liquidity and Capital Resources - Continued
-------------------------------------------

renewals with current tenants and manages local  advertising with the assistance
of the NTS  Development  Company's  marketing  staff.  The  leasing  and renewal
negotiations  at  Lakeshore  Business  Center  Phases I and II are  handled by a
leasing agent, an employee of NTS Development Company,  located at the Lakeshore
Business  Center  development.  At  The  Willows  of  Plainview  Phase  II,  the
Partnership has an on-site leasing staff,  employees of NTS Development Company,
who handle all  on-site  visits  from  potential  tenants,  make visits to local
companies  to promote  fully-furnished  units,  negotiate  lease  renewals  with
current  residents and coordinate  all local  advertising  with NTS  Development
Company's marketing staff.

Leases  at the  Partnership's  commercial  properties  provide  for  tenants  to
contribute toward the payment of common area expenses, insurance and real estate
taxes.  Leases at the Partnership's  Florida commercial  properties also provide
for rent  increases  which are based upon increases in the consumer price index.
These  lease  provisions,  along  with  the fact  that  residential  leases  are
generally for a period of one year, should protect the Partnership's  operations
from the impact of inflation and changing prices.

The  Partnership  owns  approximately  6.21  acres  of  land,  adjacent  to  the
University Place development,  in Orlando, Florida which is zoned for commercial
development.  Included  in the  cost of  $2,048,320  is land  cost,  capitalized
interest  and common  area  costs.  At the  current  time,  the  Partnership  is
negotiating the sale of the Phase III vacant land along with University Business
Center  Phases I and II to Full  Sail  Recorders,  Inc.  See below for a further
discussion  of the  possible  sale.  If this  transaction  does not  occur,  the
Partnership  will continue to evaluate the  possibility  of building  University
Business  Center  Phase III on the vacant  land.  The  decision to build will be
based on market  conditions,  availability of financing and  availability of the
necessary resources from the Partnership.  In management's opinion, the net book
value of the asset approximates its fair market value.

On December 30, 1997, Full Sail delivered written notice to the Partnership that
Full Sail had (i) exercised its right of first refusal under its lease with NTS-
Properties V to purchase  University  Business  Center Phase I ("University  I")
office  building and the Phase III vacant land,  and (ii) exercised its right of
first refusal  under its lease with NTS  University  Boulevard  Joint Venture to
purchase University Business Center II ("University  II")office building, for an
aggregate  purchase  price  for all three of  $18,700,000.  Because  no  binding
agreement  exists for the purchase of the properties at this time,  there can be
no assurance that a mutual  agreement of purchase and sale will be reached among
the parties,  nor that the sale of the properties will be consummated.  As such,
the  Partnership  has not determined the use of net proceeds after  repayment of
outstanding  debt from any such  sale nor has it  determined  the  impact on its
future  results of operations or financial  position.  The  University II office
building  is  owned  by the  L/U II  Joint  Venture,  the  successor  to the NTS
University  Boulevard Joint Venture,  in which the Partnership  owns a 69% joint
venture interest. Under the terms of the right of first refusal, the closings of
the sale of  University  I,  University  II and the Phase III vacant land are to
occur simultaneously.

The L/U II Joint  Venture owns  approximately  6.2 acres of land adjacent to the
Lakeshore  Business  Center  development  in  Ft.   Lauderdale,   Florida.   The
Partnership's proportionate interest at June 30, 1998 in the asset held for sale
is  $1,152,868.  The Joint  Venture  continues to actively  market the asset for
sale.  In  management's  opinion,  the net book value of the asset held for sale
approximates  the fair market value less cost to sell. See below for information
regarding a contract for the sale of a portion of this land.

Subsequent to June 30, 1998,  the L/U II Joint  Venture  entered into a contract
for the sale of  approximately  2.4  acres  of land  adjacent  to the  Lakeshore
Business Center  development  for a purchase price of $528,405.  Concurrent with
the signing of the contract,  the  purchaser  deposited  into an escrow  account
$10,000.  This  deposit will be applied to the  purchase  price at closing.  The
purchaser has until  November 17, 1998 to determine if the land is  satisfactory
for their use. If the purchaser determines that it is satisfactory, the contract
requires that

                                     - 17 -

<PAGE>



Liquidity and Capital Resources - Continued
-------------------------------------------

they  proceed,  at their  cost,  to have the  property  re-zoned  to allow for a
self-storage facility. If the purchaser is unable to obtain the re-zoning,  they
may cancel the contract.  The General  Partner of the  Partnership  has met with
city officials who seem  interested in the project and have voiced a willingness
to consider the re-zoning request. If the re-zoning is granted, the purchaser is
to close on the  property by February 1, 1999 or deposit an  additional  $10,000
with the  escrow  agent for a 30-day  delay.  The  contract  also  allows for an
additional  deposit of  $10,000  for one more delay in closing to April 3, 1999.
The Partnership has a 69% interest in the Joint Venture. The Partnership has not
yet determined what the use of net proceeds would be from the sale of the land.

Some of the statements included in Item 2, Management's  Discussion and Analysis
of  Financial  Condition  and Results of  Operations,  may be  considered  to be
"forward-looking  statements" since such statements relate to matters which have
not yet occurred. For example,  phrases such as the Partnership  "anticipates ",
"believes" or "expects" indicate that it is possible that the event anticipated,
believed or expected may not occur. Should such event not occur, then the result
which  the  Partnership  expected  also may not  occur  or occur in a  different
manner, which may be more or less favorable to the Partnership.  The Partnership
does not  undertake  any  obligations  to  publicly  release  the  result of any
revisions to these  forward-looking  statements  that may be made to reflect any
future events or circumstances.

Any forward-looking  statements included in Management's Discussion and Analysis
of Financial  Condition and Results of Operations,  or elsewhere in this report,
which reflect  management's best judgement based on factors known, involve risks
and uncertainties. Actual results could differ materially from those anticipated
in any forward-looking  statements as a result of a number of factors, including
but not  limited  to those  discussed  below.  Any  forward-looking  information
provided by the  Partnership  pursuant to the safe harbor  established by recent
securities legislation should be evaluated in the context of these factors.

The Partnership's principal activity is the leasing and management of commercial
office  buildings,  business  centers  and  an  apartment  complex.  If a  major
commercial  tenant  or a large  number of  apartment  lessees  default  on their
leases,  the  Partnership's   ability  to  make  payments  due  under  its  debt
agreements,  payment of operating costs and other partnership  expenses would be
directly  impacted.  A lessee's  ability to make  payments  are subject to risks
generally  associated with real estate,  many of which are beyond the control of
the Partnership,  including general or local economic  conditions,  competition,
interest rates, real estate tax rates, other operating expenses and acts of God.

A portion of the Partnership's debt service is based on variable interest rates;
any  fluctuations in the rate are beyond the control of the  Partnership.  These
variances could, for example,  impact the Partnership's  projected cash flow and
cash  requirements  as well as its ability to pay  distributions  to the limited
partners.





















                                     - 18 -

<PAGE>



PART II.  OTHER INFORMATION

3.      Defaults Upon Senior Securities
        -------------------------------

        None.

6.      Exhibits and Reports on Form 8-K
        --------------------------------

          (a)    Exhibits

                 Exhibit 27. Financial Data Schedule

          (b)    Reports on Form 8-K

                 Form 8-K was  filed on April 7,  1998 to  report in Item 5 that
                 the  Partnership  has elected to fund an  additional  amount of
                 $30,000 to its Interest Repurchase Reserve.

                 Form 8-K was filed on May 18, 1998 to report in Item 5 that the
                 Partnership has elected to fund an additional amount of $11,850
                 to its Interest Repurchase Reserve.

                 Form 8-K was filed on May 26, 1998 to report in Item 5 that the
                 Partnership has elected to fund an additional amount of $96,000
                 to its Interest Repurchase Reserve.

                 Form 8-K was filed on June 2, 1998 to report in Item 5 that the
                 Partnership has elected to fund an additional amount of $10,080
                 to its Interest Repurchase Reserve.

Items 1,2,4 and 5 are not applicable and have been omitted.


                                     - 19 -

<PAGE>



                                   SIGNATURES
                                   ----------

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  NTS-Properties  V has duly  caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.


                                        NTS-PROPERTIES V, a Maryland Limited
                                        Partnership
                                        ------------------------------------
                                                     (Registrant)


                                        By:     NTS-Properties Associates V,
                                                General Partner
                                                By: NTS Capital Corporation,
                                                    General Partner


                                                    /s/ Richard L. Good
                                                    -------------------
                                                    Richard L. Good
                                                    President



                                                    /s/ Lynda J. Wilbourn
                                                    ---------------------
                                                    Lynda J. Wilbourn
                                                    Vice President
                                                    Principal Accounting Officer



Date:     August 12, 1998
          ---------------




                                     - 20 -

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