<PAGE>



                                  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                 September 30, 1996
                                ------------------------------------------------

                                       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 (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,  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 September 30, 1996 and December 31, 1995                  3

         Statements of Operations
           For the three months and nine months ended
           September 30, 1996 and 1995                                     4

         Statements of Cash Flows
           For the three months and nine months ended
           September 30, 1996 and 1995                                     5

         Notes to Financial Statements                                   6-8

Item 2.  Management's Discussion and Analysis of Financial
           Condition and Results of Operations                          9-18

                                     PART II

1.       Legal Proceedings                                                19
2.       Changes in Securities                                            19
3.       Defaults upon Senior Securities                                  19
4.       Submission of Matters to a Vote of Security Holders              19
5.       Other Information                                                19
6.       Exhibits and Reports on Form 8-K                                 19

Signatures                                                                20

                                       -2-

<PAGE>

<TABLE>


PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

                                NTS-PROPERTIES V
                         A Maryland Limited Partnership

                BALANCE SHEETS AND STATEMENT OF PARTNERS' EQUITY

<CAPTION>

                                                                               As of                            As of
                                                                         September 30, 1996              December 31, 1995*
                                                                    ----------------------------    --------------------------


ASSETS
<S>                                                                    <C>                                <C>                 
   Cash and equivalents                                                $           499,138                $            218,331
   Cash and equivalents - restricted                                               438,629                              56,318
   Accounts receivable, net of
      allowance for doubtful accounts of
      $31,188 (1996) and $53,582 (1995)                                            666,330                             766,624
   Land, buildings and amenities, net                                           25,316,191                          26,149,956
   Assets held for development, net                                              3,470,429                           3,585,818
   Other assets                                                                  1,020,059                             760,426
                                                                       -------------------                --------------------

                                                                       $        31,410,776                $         31,537,473
                                                                       ===================                ====================

LIABILITIES AND PARTNERS' EQUITY
   Mortgages and notes payable                                         $        22,938,434                $         22,839,940
   Accounts payable - operations                                                   414,571                             365,431
   Accounts payable - construction                                                 236,871                             231,566
   Security deposits                                                               156,285                             147,330
   Other liabilities                                                               452,871                              35,717
                                                                       -------------------                --------------------

                                                                                24,199,032                          23,619,984

   Partners' equity                                                              7,211,744                           7,917,489
                                                                       -------------------                --------------------

                                                                       $        31,410,776                $         31,537,473
                                                                       ===================                ====================

</TABLE>
<TABLE>
<CAPTION>


                                          Limited           General
                                         Partners           Partner              Total
                                      -------------       -------------       ------------
<S>                                   <C>                 <C>                 <C>         
PARTNERS' EQUITY
Capital contributions,
  net of offering costs               $ 30,582,037        $        100        $ 30,582,137
Net income (loss) - prior
  years                                 (7,124,963)             41,828          (7,083,135)
Net loss - current year                   (642,289)             (6,488)           (648,777)
Cash distributions
  declared to date                     (15,389,204)           (155,527)        (15,544,731)
Repurchase of limited
  partnership units                        (93,750)                 --             (93,750)
                                      ------------        ------------        ------------

Balances at September 30, 1996        $  7,331,831        $   (120,087)       $  7,211,744
                                      ============        ============        ============


</TABLE>

*  Reference  is made to the audited  financial  statements  in the Form 10-K as
   filed with the Commission on March 29, 1996.

                                       -3-

<PAGE>
<TABLE>



                                NTS-PROPERTIES V,
                         A Maryland Limited Partnership

                            STATEMENTS OF OPERATIONS

<CAPTION>

                                                    Three Months Ended                         Nine Months Ended
                                                      September 30,                              September 30,
                                          --------------------------------------     --------------------------------------

                                                1996                  1995                 1996                 1995
                                          -----------------     ----------------     -----------------    -----------------
<S>                                       <C>                   <C>                  <C>                  <C>               
REVENUES:
  Rental income, net of provision
  for doubtful accounts of $3,110
   (1996) and $30,605 (1995)              $       1,466,449     $      1,345,168     $       4,253,047    $       4,007,560
  Interest and other income                           6,869                8,091                19,406               51,834
                                          -----------------     ----------------     -----------------    -----------------

                                                  1,473,318            1,353,259             4,272,453            4,059,394

EXPENSES:
  Operating expenses                                297,674              271,105               795,761              711,512
  Operating expenses - affiliated                   126,624              127,001               388,122              384,092
 Write-off of unamortized loan
  costs                                              50,118                   --                50,118                   --
  Amortization of capitalized
     leasing costs                                    5,225                8,978                13,532               24,735
  Interest expense                                  476,080              575,755             1,543,009            1,619,623
  Management fees                                    85,068               80,490               254,162              240,389
  Real estate taxes                                 139,884              143,095               408,824              391,613
  Professional and administrative
     expenses                                        25,307               41,430                79,884              103,527
  Professional and administrative
     expenses - affiliated                           43,549               39,954               122,348              117,733
  Depreciation and amortization                     414,843              452,229             1,265,470            1,348,836
                                          -----------------     ----------------     -----------------    -----------------

                                                  1,664,372            1,740,037             4,921,230            4,942,060
                                          -----------------     ----------------     -----------------    -----------------

Net loss                                  $        (191,054)    $       (386,778)    $        (648,777)   $        (882,666)
                                          =================     ================     =================    =================

Net loss allocated to the limited
  partners                                $        (189,143)    $       (382,910)    $        (642,289)   $        (873,839)
                                          =================     ================     =================    =================

Net loss per limited partnership
  unit                                    $          (5.31)     $        (10.67)     $         (17.97)    $         (24.35)
                                          =================     ================     =================    =================

Weighted average number of units                    35,647               35,876                35,748               35,876
                                          =================     ================     =================    =================

</TABLE>



                                       -4-

<PAGE>
<TABLE>



                                NTS-PROPERTIES V
                         A Maryland Limited Partnership

                            STATEMENTS OF CASH FLOWS
<CAPTION>


                                                              Three Months Ended             Nine Months Ended
                                                                 September 30,                 September 30,
                                                        ----------------------------    ----------------------------

                                                            1996             1995          1996            1995
                                                        ------------    ------------    ------------    ------------
<S>                                                     <C>             <C>             <C>             <C>   
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                $  (191,054)    $  (386,778)    $  (648,777)    $  (882,666)
Adjustments to reconcile net loss to
  net cash provided by operating
  activities:
      Provision for doubtful accounts                         3,110          21,285           3,110          30,605
    Write-off of unamortized loan
      costs                                                  50,118              --          50,118              --
      Amortization of capitalized leasing
        costs                                                 5,225           8,978          13,532          24,735
      Depreciation and amortization                         414,843         452,229       1,265,470       1,348,836
      Changes in assets and liabilities:
        Cash and equivalents - restricted                  (125,733)       (126,432)       (396,032)       (278,115)
        Accounts receivable                                 (17,326)          4,728          97,184         116,830
        Other assets                                         17,308          23,347        (100,880)         55,977
        Accounts payable - operations                        18,394          26,837          49,140          14,153
        Security deposits                                     9,902           1,722           8,955           4,139
        Other liabilities                                   154,561         161,283         417,154          54,107
                                                        -----------     -----------     -----------     -----------

   Net cash provided by operating
      activities                                            339,348         187,199         758,974         488,601
                                                        -----------     -----------     -----------     -----------

CASH FLOWS FROM INVESTING ACTIVITIES
Additions to land, buildings and
   amenities                                               (134,656)         (1,154)       (264,509)        (31,865)
Increase in cash and equivalents -
   restricted                                                    --            (499)             --         (79,229)
Decrease in cash and equivalents -
  restricted                                                     --          19,132          13,721          19,132
                                                        -----------     -----------     -----------     -----------

   Net cash provided by (used in)
      investing activities                                 (134,656)         17,479        (250,788)        (91,962)
                                                        -----------     -----------     -----------     -----------

CASH FLOWS FROM FINANCING ACTIVITIES
Increase in mortgages payable                            12,046,020              --      18,546,020              --
Principal payments on mortgages and
  notes payable                                         (11,758,447)       (180,522)    (18,447,526)       (554,381)
Capital contribution by a joint
  venture partner                                                --              --              --         519,225
Additions to loan costs                                    (206,417)             --        (268,903)        (99,813)
Repurchase of limited partnership
  units                                                      (7,020)             --         (56,970)             --
                                                        -----------     -----------     -----------     -----------

   Net cash provided by (used in)
      financing activities                                   74,136        (180,522)       (227,379)       (134,969)
                                                        -----------     -----------     -----------     -----------

  Net increase in cash and equivalents                      278,828          24,156         280,807         261,670

CASH AND EQUIVALENTS, beginning of
   period                                                   220,310         445,114         218,331         207,600
                                                        -----------     -----------     -----------     -----------

CASH AND EQUIVALENTS, end of period                     $   499,138     $   469,270     $   499,138     $   469,270
                                                        ===========     ===========     ===========     ===========

Interest paid on a cash basis                           $   502,490     $   578,414     $ 1,582,947     $ 1,621,586
                                                        ===========     ===========     ===========     ===========
</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  1995 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 nine months ended September 30, 1996 and 1995.

1.    Cash and Equivalents - Restricted

      Cash  and   equivalents  -  restricted   represents   funds  received  for
      residential  security  deposits  and funds which have been  escrowed  with
      mortgage  companies  for  property  taxes  in  accordance  with  the  loan
      agreements.

      Cash and  equivalents  -  restricted  at December  31, 1995 also  included
      escrow  funds which were to be released as capital  expenditures,  leasing
      commissions and tenant  improvements were incurred at the properties owned
      by the  Lakeshore/University II Joint Venture. In 1996, these escrow funds
      were released.

2.    New Accounting Pronouncement

      In March 1995, the Financial  Accounting  Standards Board issued Statement
      No. 121 (the  "Statement")  on accounting for the impairment of long-lived
      assets, certain identifiable  intangibles,  and goodwill related to assets
      to be held and used. The Statement also establishes  accounting  standards
      for long-lived assets and certain identifiable  intangibles to be disposed
      of.  The  Partnership  adopted  the  Statement  as of  January  1, 1996 as
      required. No adjustments were required.

3.    Interest Repurchase Reserve

      On June 28,  1996,  the  Partnership  established  an Interest  Repurchase
      Reserve  in  the  amount  of  $50,000  pursuant  to  Section  16.4  of the
      Partnership's Amended and Restated Agreement of Limited Partnership. Under
      Section 16.4,  limited  partners may request the Partnership to repurchase
      their respective interests (Units) in the Partnership.  With this Interest
      Repurchase  Reserve,  the Partnership  repurchased 370 Units at a price of
      $135 per Unit.  The  Partnership  notified the limited  partners by letter
      dated  February 1, 1996 of the  establishment  of the Interest  Repurchase
      Reserve and the  opportunity  to request that the  Partnership  repurchase
      Units at the  established  price.  On August  30,  1996,  the  Partnership
      elected to fund an additional $50,000 to its Interest  Repurchase Reserve.
      With  this  funding,  the  Partnership  will  be  able  to  repurchase  an
      additional  370 Units at a price of $135 per  Unit.  As of  September  30,
      1996, 422 Units have been  repurchased.  Repurchased  Units are retired by
      the Partnership,  thus increasing the share of ownership of each remaining
      investor.



             (Notes to Financial Statements continued on next page)





                                       -6-

<PAGE>



4.    Mortgages and Notes Payable

      Mortgages and notes payable consist of the following:


                                                 September 30,     December 31,
                                                     1996             1995
                                                 ------------    ---------------


     Mortgage  payable with an insurance  
     company bearing interest at a fixed 
     rate of 7.65%, due February 1, 2008,
     secured by land and building                $  4,945,031    $           --

     Mortgage  payable with an insurance  
     company bearing interest at a fixed 
     rate of 8.125%, due August 1, 2008,
     secured by land and building                   4,153,913                --

     Mortgage  payable with an insurance  
     company bearing interest at a fixed 
     rate of 8.125%, due August 1, 2008,
     secured by land and building                   3,981,551                --

     Mortgage  payable with an insurance  
     company bearing interest at a fixed 
     rate of 8.125%, due August 1, 2008,
     secured by land and building                   3,860,898                --

     Mortgage  payable with an insurance  
     company bearing interest at a fixed 
     rate of 7.5%, due December 5, 2003,
     secured by land, buildings and                 
     amenities                                      2,902,144         2,929,404

     Mortgage  payable with an insurance  
     company bearing interest at a fixed 
     rate of 7.5%, due December 5, 2003,
     secured by land, buildings and                 
     amenities                                      1,732,623         1,748,897

     Note payable with a bank bearing
     interest at the Prime Rate, due
     February 1, 2009, secured by land and         
     building                                       1,362,274                --

     Note payable to a bank bearing interest
     at a fixed rate of 10.6%, due January
     31, 1998, secured by land and building                --         6,371,930

     Note payable to a bank bearing interest
     at a fixed rate of 10.6%, due January
     31, 1998, secured by land and building                --         3,973,802

     Note payable to a bank bearing interest
     at a fixed rate of 10.6%, due January  
     31, 1998, secured by land                             --           854,298

     Note payable to a bank bearing interest
     at a fixed rate of 10.6%, due January
     31, 1998, secured by land                             --           324,227

                              (continued next page)

                                       -7-

<PAGE>






  4. Mortgages and Notes Payable - Continued


                                           September 30,       December 31,
                                               1996                1995
                                         ----------------    ---------------

     Note payable to a bank bearing
     interest at a fixed rate of 10.6%,
     due January 31, 1998, secured by  
     land                                 $           --      $     235,382

     Note  payable to a bank  bearing  
     interest at the Prime Rate + 1%, 
     due March 31, 1996, secured by 
     land and buildings                               --           6,402,000
                                          ----------------    --------------
                                          $   22,938,434      $   22,839,940
                                          ================    ==============


      The Prime Rate was 8.25% at  September  30,  1996 and was 8.5% at December
      31, 1995.

      Based on the borrowing  rates  currently  available to the Partnership for
      mortgages  with  similar  terms,  the  fair  value  of long  term  debt is
      approximately $24,600,000.

5.    Related Party Transactions

      Property  management  fees of $254,162  and  $240,389  for the nine months
      ended  September  30,  1996  and  1995,  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 pursuant to
      an agreement  with the  Partnership.  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  $14,747 and $6,157 as a repair and  maintenance
      fee  during  the  nine  months   ended   September   30,  1996  and  1995,
      respectively, and has capitalized this cost as part of land, buildings and
      amenities.

      As  permitted  by an  agreement,  the  Partnership  also was  charged  the
      following  amounts from NTS Development  Company for the nine months ended
      September 30, 1996 and 1995.  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.


                                  1996                    1995
                           -----------------        ----------------

      Administrative        $         163,425       $        156,174
      Leasing                         167,680                123,258
      Property manager                234,029                242,617
      Other                            23,604                  8,092
                           ------------------       ----------------

                           $          588,738       $        530,141
                           ==================       ================
                          

6.    Reclassification of 1995 Financial Statements

      Certain  reclassifications  have  been  made  to the  September  30,  1995
      financial  statements to conform with September 30, 1996  classifications.
      These reclassifications have no effect on previously reported operations.

                                       -8-

<PAGE>



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

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

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




                                                        1996            1995
                                                        ----            ----

Wholly-owned Properties
-----------------------

Commonwealth Business Center Phase II                     90%             68%

University Business Center Phase I                        98%             92%

Properties Owned in Joint Venture
with NTS-Properties IV (Ownership % at
September 30, 1996)
--------------------------------------

The Willows of Plainview Phase II (90%)                   96%             94%

Lakeshore Business Center Phase I
(See L/U II Joint Venture below)                    See below       See below
                                                          (1)             (1)

Property Owned in Joint Venture with
NTS-Properties Plus Ltd. (Ownership % at
September 30, 1996)
----------------------------------------

University Business Center Phase II
(See L/U II Joint Venture below)                    See below       See below
                                                          (1)             (1)

Properties Owned Through Lakeshore/
University II Joint Venture (L/U II
Joint Venture) (Ownership % at September
30, 1996)
----------------------------------------

Lakeshore Business Center Phase I (69%)                   97%             87%

Lakeshore Business Center Phase II (69%)                  83%             73%(2)

University Business Center Phase II (69%)                100%            100%

(1)   During the first quarter of 1995, the Partnership's ownership interest in
      the property changed.  See below for a discussion regarding this change.

(2)   The  Partnership  obtained an interest in this property during the first
      quarter of 1995. See below for a discussion regarding this change.

                                       -9-

<PAGE>



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

The rental and other income  generated by the  Partnership's  properties for the
three months and nine months ended September 30, 1996 and 1995 was as follows:


                                    Three Months Ended     Nine Months Ended
                                       September 30,          September 30,
                                   --------------------  -----------------------

                                      1996       1995       1996        1995
                                   ---------  ---------  ----------  -----------
Wholly-owned Properties
-----------------------

Commonwealth Business Center
  Phase II                         $160,983   $ 129,221  $  392,953  $  483,946

University Business Center
  Phase I                          $355,076   $ 333,331  $1,069,250  $1,028,913

Properties Owned in Joint
Venture with NTS-Properties IV
(Ownership % at September 30,
1996)
-------------------------------

The Willows of Plainview
  Phase II (90%)                   $303,860   $ 276,554  $  873,419  $  793,715

Lakeshore Business Center
  Phase I
(See L/U II Joint Venture below)        N/A         N/A         N/A  $   74,043
                                                                            (1)
Property Owned in Joint Venture
with NTS-Properties Plus Ltd.
(Ownership % at September 30,
1996)
------------------------------

University Business Center
  Phase II
(See L/U II Joint Venture below)        N/A         N/A         N/A  $   17,263
                                                                            (1)
Properties Owned Through
Lakeshore/University II Joint
Venture (L/U II Joint Venture)
(Ownership % at September 30,
1996)
------------------------------

Lakeshore Business Center
  Phase I (69%)                    $237,867   $ 197,505  $  720,035  $  519,180

Lakeshore Business Center
  Phase II (69%)                   $201,317   $ 205,733  $  580,731  $  567,466
                                                                            (2)

University Business Center
  Phase II (69%)                   $210,762   $ 206,613  $  626,636  $  561,861

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

(1)    During the first quarter of 1995, the Partnership's ownership interest in
       the property changed. The Partnership's proportionate share of rental and
       other  income from  January 23, 1995 to  September  30, 1995 is reflected
       below (see L/U II Joint  Venture).  See below for a discussion  regarding
       this change.

(2)    The  Partnership  obtained an interest in this property  during the first
       quarter of 1995. See below for a discussion regarding this change.


                                      -10-

<PAGE>



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

The 22%  increase in  occupancy at  Commonwealth  Business  Center Phase II from
September  30,  1995 to  September  30,  1996 is a result  of three  new  leases
totalling  approximately  17,000  square  feet.  Included  in  this  total  is a
five-year lease for approximately 14,000 square feet. Partially  off-setting the
new leases are three tenant move-outs totalling approximately 4,200 square feet.
Two of the tenants,  which occupied  3,200 square feet,  vacated the premises at
the end of the lease terms. The third tenant,  which had occupied  approximately
1,000  square  feet,  continued  to pay rent  through  the end of its lease term
(February 1996). There was no accrued income associated with this lease. Average
occupancy  increased  from 80% (1995) to 90% (1996) for the three  months  ended
September  30 and  decreased  from 93%  (1995) to 75%  (1996) for the nine month
period. The decrease in rental and other income at Commonwealth  Business Center
Phase II for the nine months  ended  September  30, 1996 as compared to the same
period in 1995 is primarily the result of the decrease in average  occupancy for
the  period   partially   offset  by  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.  The
increase in rental and other income at Commonwealth Business Center Phase II for
the three  month  period is  primarily  the  result of the  increase  in average
occupancy and an increase in common area expense reimbursements.

The 6%  increase  in  occupancy  at  University  Business  Center  Phase  I from
September  30,  1995 to  September  30,  1996 is a result  of seven  new  leases
totalling  approximately 14,000 square feet. Partially offsetting the new leases
are four tenant  move-outs of  approximately  8,900  square feet.  Approximately
4,400 square feet  represents two tenants who vacated the premises at the end of
the lease term. The third tenant, who occupied  approximately 1,700 square feet,
represents a tenant who vacated prior to the end of the lease term. The move-out
was the result of a downsizing by the tenant's  parent  company.  The tenant has
paid the Partnership a lease  termination fee of approximately  $5,800 (recorded
as rental income).  There was no accrued income  associated with this lease. The
fourth  tenant,  who  occupied  approximately  2,800  square  feet,  vacated the
premises prior to the end of the lease term due to bankruptcy. Accrued income of
approximately   $3,800   associated   with  this   lease  was   written-off   as
uncollectible. Average occupancy at University Business Center Phase I increased
from 92%  (1995) to 97%  (1996)  for the three  months  ended  September  30 and
increased from 91% (1995) to 96% (1996) for the nine month period.  The increase
in rental and other income at University  Business  Center Phase I for the three
months and nine months ended  September 30, 1996 as compared to the same periods
in 1995 is primarily due to the increase in average occupancy.

The Willows of Plainview Phase II's occupancy increased from 94% as of September
30, 1995 to 96% as of September 30, 1996.  Average occupancy  increased from 91%
(1995) to 95% (1996) for the nine months ended  September 30 and increased  from
93% (1995) to 96% (1996) for the three month  period.  Occupancy at  residential
properties fluctuate 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  increase  in average  occupancy,  an increase in rental
rates,  along with an increase in income from fully  furnished units resulted in
an increase in rental and other income at The Willows of Plainview  Phase II for
the three  months and nine months  ended  September  30, 1996 as compared to the
same periods in 1995.  Fully  furnished  units are  apartments  which rent at an
additional premium above base rent.

The  10%  increase  in  occupancy  at  Lakeshore  Business  Center  Phase I from
September  30, 1995 to September 30, 1996 can be attributed to seven new leases,
totalling  approximately  19,500 square feet which includes  approximately 6,900
square  feet  in  expansions  by  three  current  tenants.  The new  leases  and
expansions  are  partially  offset by three  tenants,  who  occupied  a total of
approximately  5,200 square feet,  vacating the premises at the end of the lease
terms.  Average  occupancy for the nine months ended September 30 increased from
81% (1995) to 98%

                                      -11-

<PAGE>



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

(1996) and  increased  from 84% (1995) to 97% (1996) for the three month period.
The increase in rental and other income at Lakeshore Business Center Phase I for
the three  months and nine months  ended  September  30, 1996 as compared to the
same periods in 1995 is primarily due to the increase in average occupancy and a
decrease in the  provision  for  doubtful  accounts.  The increase in rental and
other income for the nine month period is partially offset by the  Partnership's
decreased  ownership  in  Lakeshore  Business  Center  Phase I. (See below for a
discussion regarding this change.)

Subsequent  to September  30, 1996,  an  approximately  5,000 square foot tenant
vacated Lakeshore Business Center Phase I prior to the end of the lease term. As
a result of this tenant move-out,  the business center's occupancy has decreased
to 92%.

The 10%  increase  in  occupancy  at  Lakeshore  Business  Center  Phase II from
September  30, 1995 to September  30, 1996 can be attributed to three new leases
totalling approximately 13,800 square feet and expansions by two current tenants
totalling  approximately 7,000 square feet.  Partially offsetting the new leases
are two  tenant  move-outs  totalling  approximately  5,100  square  feet  and a
downsizing  by a current  tenant of its existing  space of  approximately  6,000
square feet. The move-outs represent tenants who vacated prior to the end of the
lease  term but are  continuing  to pay rent  through  the end of the lease term
(September 1996 and August 1997). Average occupancy at Lakeshore Business Center
Phase II  increased  from 77% (1995) to 81% (1996)  for the three  months  ended
September  30 and  decreased  from 79%  (1995) to 78%  (1996) for the nine month
period.  Overall, rental and other income decreased at Lakeshore Business Center
Phase II for the nine months  ended  September  30, 1996 as compared to the same
period in 1995  primarily  as a result of a  decrease  in rental  rates on lease
renewals.  As  discussed  in prior  filings,  prior to the Ft.  Lauderdale  area
experiencing an economic downturn, the property was able to negotiate higher net
effective rental rates than current market rental rates. As a result, the leases
that were  renewed  at the end of 1995 and the  beginning  of 1996  renewed at a
lower net effective rental rate. The  Partnership's  proportionate  share of the
rental  and other  income  at  Lakeshore  Business  Center  Phase  II,  however,
increased  for the nine months ended  September 30, 1996 as compared to the same
period  in  1995.  This is due to the  fact  that the  Partnership  acquired  an
interest in Lakeshore  Business  Center Phase II as a result of the formation of
the  Lakeshore/University II Joint Venture (L/U II Joint Venture) on January 23,
1995. (See below for a discussion regarding the Joint Venture.) Overall,  rental
and other income at Lakeshore  Business Center Phase II remained fairly constant
for the three  month  period  ended  September  30, 1996 as compared to the same
period in 1995.

As of September 30, 1996,  Lakeshore  Business Center Phase II had approximately
3,900 square feet of additional space leased to a current tenant.  The tenant is
expected  to take  occupancy  during the fourth  quarter of 1996.  With this new
lease, the business center's occupancy should improve to 87%.

Philip Crosby  Associates,  Inc. ("PCA") has leased 100% of University  Business
Center  Phase  II.  The lease  term is for  seven  years,  and the  tenant  took
occupancy  in April 1991.  PCA has  currently  sub-leased  approximately  70,000
square feet (or 91%) of University Business Center Phase II to three tenants. Of
the total being sub-leased,  approximately  59,000 square feet (or 84%) is being
leased by Full Sail  Recorders,  Inc.  (a major  tenant at  University  Business
Center Phase I). In December  1995,  Full Sail  Recorders,  Inc.  ("Full  Sail")
signed a 33- month lease with the L/U II Joint Venture for approximately  41,000
square feet it currently  sub-leases  from PCA. The lease term  commences  April
1998 when PCA's lease ends.  As part of the lease  negotiations,  Full Sail will
receive a $200,000  tenant  finish  allowance  in 1996,  of which  approximately
$92,000  will be  reimbursed  by Full Sail over a 27-month  period  which  began
January 1996. The Joint Venture has received  notice that PCA will not renew its
lease when it expires in 1998.  At this time,  it is not known whether the other
sublessees will sign lease renewals with the Joint Venture.



                                      -12-

<PAGE>



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

The  Partnership's  proportionate  share  of the  rental  and  other  income  at
University  Business  Center  Phase  II  increased  for the  nine  months  ended
September  30,  1996 as  compared  to the same period in 1995 as a result of the
Partnership's  increased  ownership  in the  business  center.  (See below for a
discussion regarding the change.) Overall, rental and other income at University
Business  Center Phase II decreased for the nine months ended September 30, 1996
as  compared to the same period in 1995 as a result of a decrease in common area
expense  reimbursements.  The tenant  reimburses the Partnership for common area
expenses as part of the lease agreement. The decrease in rental and other income
for the nine month period is partially offset by a rent escalation based upon an
increase in the consumer  price index.  The change in rental and other income at
University  Business  Center  Phase  II for  the  three  month  period  was  not
significant.

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 a possible  collection.  There
have been no funds recovered as a result of these actions during the nine months
ended September 30, 1996 and 1995.

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.

The decrease in interest  and other  income for the nine months ended  September
30,  1996 as  compared  to the same  period in 1995 is  primarily  the result of
approximately  $21,600 in interest  income  being  recognized  during the second
quarter of 1995 on a  receivable  from a tenant at  University  Business  Center
Phase I. Interest income was not recognized until the receivable had been repaid
in full due to the  length  of time it had taken the  tenant  to  reimburse  the
Partnership.  Interest  and other  income  also  includes  interest  earned from
investments made by the Partnership with cash reserves. The decrease in interest
income for the nine  months  ended  September  30,  1996 as compared to the same
period in 1995 is also a result of a decrease  in cash  reserves  available  for
investment.  The change in interest  income for the three  month  period was not
significant.

Operating  expenses  increased  for the  three  months  and  nine  months  ended
September  30,  1996 as compared  to the same  periods in 1995 due to  increased
expenses associated with fully furnished units at The Willows of Plainview Phase
II and increased  legal fees at Lakeshore  Business Center Phase I. The increase
in operating  expenses for the nine month  period can also be  attributed  to an
increase in vacant suite  utilities at  Commonwealth  Business  Center Phase II,
increased  exterior  painting  costs at University  Business  Center Phase I and
increased  utilities  and repairs and  maintenance  costs at Lakeshore  Business
Center Phase II. The increase in operating expenses for the nine month period is
also  the   result   of  the   Partnership   acquiring   an   interest   in  the
Lakeshore/University  II  Joint  Venture  in  January  1995.  (See  below  for a
discussion  regarding the Joint Venture.)  Partially  offsetting the increase in
operating  expenses  for the three month and nine month  periods  are  decreased
exterior painting costs and decreased carpet and wallcovering  replacement costs
at  the  Willows  of  Plainview  Phase  II and  decreased  janitorial  costs  at
University Business Center Phase II.

The change in  operating  expenses -  affiliated  for the three  months and nine
months ended  September 30, 1996 as compared to the same periods in 1995 was not
significant.  Operating expenses - affiliated are expenses incurred for services
performed by employees of NTS Development  Company,  an affiliate of the General
Partner of the Partnership.

The 1996  write-off of  unamortized  loan costs relate to loan costs  associated
with the  Lakeshore/University II Joint Venture's notes payable. The unamortized
loan costs  were  expensed  due to the fact that the notes were  retired in 1996
prior to

                                      -13-

<PAGE>



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

their  maturity  (January 31, 1998).  See the  Liquidity  and Capital  Resources
section of this item for further discussion.

The decrease in the  amortization  of  capitalized  leasing  costs for the three
months and nine months ended  September 30, 1996 as compared to the same periods
in 1995 is due to the fact that costs capitalized  during start-up at University
Business Center Phase II became fully amortized at the end of 1995.

Interest  expense  has  decreased  for the three  months and nine  months  ended
September  30,  1996 as compared to the same  periods in 1995  primarily  as the
result of lower  interest  rates on the  permanent  financings  obtained  by the
Partnership in January 1996 (secured by University  Business  Center Phase I and
Commonwealth  Business Center Phase II) and obtained by the L/U II Joint Venture
in July 1996 (secured by the assets of the Joint Venture). See the Liquidity and
Capital  Resources  section  of this item for a  discussion  of these  permanent
financings.  The  decrease  in  interest  expense  for the nine month  period is
partially  offset by the  Partnership  acquiring an interest in the L/U II Joint
Venture in January 1996 (discussed below).

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  increase in  management  fees for the nine month
period can also be  attributed to the  Partnership  acquiring an interest in the
L/U II Joint Venture in January 1995 (discussed below).

The increase in real estate taxes for the nine months ended  September  30, 1996
as compared to the same  period in 1995 is a result of an  increased  assessment
for University  Business  Center Phase I and Lakeshore  Business Center Phase I.
The  increase in real estate taxes for the nine month period is also a result of
the  Partnership  acquiring  an interest in the L/U II Joint  Venture in January
1995  (discussed  below).  The change in real  estate  taxes for the three month
period was not significant.

The decrease in professional  and  administrative  expenses for the three months
and nine months ended September 30, 1996 as compared to the same periods in 1995
is due to decreased outside legal fees.

The change in  professional  and  administrative  expenses - affiliated  for the
three  months and nine months ended  September  30, 1996 as compared to the same
periods in 1995 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 has  decreased for the three months and
nine  months  ended  September  30,  1996  as a  result  of  a  portion  of  the
Partnership's  assets (primarily tenant finish improvements) having become fully
depreciated.  The decrease in depreciation  and  amortization for the nine month
period is partially  offset by the Partnership  acquiring an interest in the L/U
II Joint Venture in January 1995  (discussed  below).  Depreciation  is computed
using the  straight-line  method over the  estimated  useful lives of the assets
which are 10 - 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
$41,400,000.

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

Cash  provided by  operating  activities  was $758,974 and $488,601 for the nine
months ended September 30, 1996 and 1995, respectively. No distribution has been
declared  since  the three  months  ended  March 31,  1994 as a result of a loan
covenant (the  $6,402,000  note payable - balance as of December 31, 1995) which
required the Partnership to have $500,000 remaining in cash or cash equivalents


                                      -14-

<PAGE>



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

(excluding  residential  security  deposits  and cash  escrowed  with a  lending
institution  for the payment of property taxes)  following a  distribution.  The
note  payable was repaid in January  1996 (see below for a further  discussion).
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
September  30) were  $499,138  and  $469,270  at  September  30,  1996 and 1995,
respectively.

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.

As  previously  disclosed  in the  Partnership's  Form  10-K for the year  ended
December 31, 1995, a new joint  venture known as  Lakeshore/University  II Joint
Venture  (L/U II Joint  Venture)  was  formed  on  January  23,  1995  among the
Partnership,   NTS-Properties   IV,   NTS-Properties   Plus  Ltd.  and  NTS/Fort
Lauderdale,  Ltd.,  affiliates of the General  Partner of the  Partnership,  for
purposes  of  owning  Lakeshore  Business  Center  Phases  I and II,  University
Business Center Phase II and certain  undeveloped tracts of land adjacent to the
Lakeshore Business Center development.

On January 29, 1996, the Partnership  obtained  permanent  financing from a bank
totalling  $1,600,000  with $200,000 held for future  fundings.  The outstanding
balance at  September  30,  1996 was  $1,362,274.  The  mortgage  payable is due
February  1,  2009,  bears  interest  at  the  Prime  Rate  and  is  secured  by
Commonwealth Business Center Phase II ("CBC II"). The remaining $200,000 will be
disbursed  by  February 1, 1999 in one  additional  advance  when the  following
conditions are met: 1) CBC II reaches a minimum occupancy of 75% based on leases
acceptable to the bank with a minimum term of not less than three years,  2) CBC
II achieves a minimum  gross  monthly base rental income of $37,500 for at least
three months,  3) the  Partnership is not in default on the loan and 4) the bank
receives  tenant  estoppel  certificates  from the  tenants  of CBC II.  Monthly
principal payments are based on a 13-year  amortization  schedule.  At maturity,
the mortgage will have been repaid based on the current rate of amortization.

On January 31,  1996,  the  Partnership  obtained  permanent  financing  from an
insurance company totalling $5,100,000. The outstanding balance at September 30,
1996 was  $4,945,031.  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.

The proceeds of these permanent financings were used to retire the Partnership's
note payable, which had a balance of $6,352,000,  to fund loan closing costs and
to increase the Partnership's cash reserves.

On July 23, 1996, the L/U II Joint Venture obtained three mortgage loans from an
insurance company totalling $17,400,000 ($6,025,000, $5,775,000 and $5,600,000).
The  outstanding  balances of the loans at September  30, 1996 were  $6,000,163,
$5,751,193 and $5,576,915,  respectively.  The loans are recorded a liability of
the  Joint  Venture.  The  Partnership's  proportionate  share  in the  loans at
September 30, 1996 was $4,153,913, $3,981,551 and $3,860,898,  respectively. 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.  The proceeds  from the
loans


                                      -15-

<PAGE>



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

were used to pay off the Joint  Venture's notes payable of  approximately  $16.8
million  which bore  interest at a fixed rate of 10.6% and to fund loan  closing
costs of approximately $280,000. The Partnership's proportionate interest in the
notes that were paid off was  approximately  $11,600,000 or 69%. The notes which
were  paid-off had a maturity date of January 31, 1998.  The remaining  proceeds
will be used to fund Joint Venture tenant finish improvements and leasing costs.

As of September  30, 1996,  The Willows of Plainview  Phase II, a joint  venture
between the Partnership and  NTS-Properties IV, had two mortgage loans each with
an insurance  company in the amount of $3,232,866 and $1,930,069.  The mortgages
are  recorded  as  a  liability  of  the  Joint   Venture.   The   Partnership's
proportionate  share of the  mortgages as of September  30, 1996 was  $4,634,767
($2,902,144 and $1,732,623).  Both mortgages are due December 5, 2003, currently
bear interest at a fixed rate of 7.5% and are secured by the land, buildings and
amenities  of the Joint  Venture.  Current  monthly  principal  payments on both
mortgages  are  based  upon a 27-year  amortization  schedule.  The  outstanding
balance  at  maturity  based  on the  current  rate  of  amortization  would  be
$4,449,434 ($2,786,095 and $1,663,339).

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 and cash reserves.  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 used in  investing  activities  in 1995 also  include cash which was being
escrowed for capital  expenditures,  leasing commissions and tenant improvements
at the  properties  owned by the L/U II Joint Venture as required by a 1995 loan
agreement.  Cash flows  provided by  investing  activities  were the result of a
release of these escrow funds.  Cash flows provided by financing  activities are
from  debt  refinancings   (discussed  above).  Cash  flows  used  in  financing
activities are for loan costs, principal payments on mortgages and notes payable
and  repurchases of limited  partnership  Units.  The capital  contribution by a
joint venture partner represents the Partnership's  interest in the L/U II Joint
Venture's  increase  in cash which  resulted  from a capital  contribution.  The
Partnership  utilizes the proportionate  consolidation  method of accounting for
joint venture  properties.  The  Partnership's  interest in the joint  venture's
assets,  liabilities,  revenues,  expenses  and cash  flows  are  combined  on a
line-by-line  basis with the  Partnership's own assets,  liabilities,  revenues,
expenses and cash flows. The Partnership does not expect any material changes in
the mix and relative cost of capital  resources except for the changes resulting
from the investment in the L/U II Joint Venture.  The Partnership also expects a
change in the cost of capital  resources as a result of the new financings which
are secured by Commonwealth Business Center Phase II, University Business Center
Phase I and the assets of the L/U II Joint Venture as discussed above.

Due to the fact that no  distributions  were made during the nine  months  ended
September  30,  1996 and 1995,  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 September 30, 1996, the  Partnership  has accrued  approximately  $155,000
(included  in  the  accounts   payable  -  construction   balance)  for  certain
improvements  to the  undeveloped  land plus  interest at the  University  Place
development.  The  purchaser  of the  approximately  1 acre tract of land at the
University Place  development has paid for the cost of these  improvements.  The
Partnership will reimburse the purchaser for these costs, along with interest at
the Prime Rate,  at the earlier of (1) the start of  construction  of University
Business Center Phase III, (2) the sale by the Partnership of any portion of the
remaining  undeveloped  land,  or (3) five years from the date of the  Agreement
(agreement dated November 1992).




                                      -16-

<PAGE>



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

The remaining  balance in accounts  payable - construction at September 30, 1996
represents  payables  that are a result of tenant  finish  improvements.  Tenant
finish  improvements  are a typical part of any lease  negotiation.  None of the
Partnership's  properties  were in the  construction  stage as of September  30,
1996.

As of  September  30,  1996,  the L/U II Joint  Venture had a  commitment  for a
$200,000 special tenant finish allowance, of which approximately $92,000 will be
reimbursed  by the tenant over a 27-month  period  which began in January  1996.
This  commitment is the result of lease  negotiations  with Full Sail Recorders,
Inc. ("Full Sail") which currently  sub-leases  approximately 59,000 square feet
from Philip Crosby Associates,  Inc. ("PCA") at University Business Center Phase
II. The Joint Venture  anticipates  that the allowance will be paid to Full Sail
during the fourth quarter of 1996 and/or early 1997.  PCA currently  leases 100%
of the business center through April 1998. Full Sail's lease term with the Joint
Venture  is for 33 months  (April  1998 to  December  2000).  The  Partnership's
proportionate   share  of  the  net   commitment($200,000   less   $92,000)   is
approximately $75,000 or 69%.

As of  September  30,  1996,  the L/U II  Joint  Venture  has a  commitment  for
approximately $65,000 of tenant finish improvements at Lakeshore Business Center
Phase  II.  The  Partnership's   proportionate   share  of  this  commitment  is
approximately  $45,000 or 69%. The commitment is the result of an expansion by a
current  tenant of its existing  space by  approximately  3,900 square feet. The
tenant is  expected  to take  occupancy  of the  expansion  space in the  fourth
quarter of 1996.

The  Partnership  had no other material  commitments  for renovations or capital
improvements at September 30, 1996.

In the next 12 months, the demand on future liquidity is anticipated to increase
as a result of the  principal  and interest  payments  required on the permanent
mortgages  obtained  by the  Partnership  in January  1996,  principal  payments
required by the new debt financings of the L/U II Joint Venture, the commitments
made for a special tenant finish allowance and tenant finish  improvements  (see
above). Additionally, the Partnership will continue its efforts to lease current
unoccupied  space at its commercial  properties.  The Partnership also expects a
demand on future  liquidity  based on 57,369 square feet in leases expiring from
October 1, 1996 to September 30, 1997  (Commonwealth  Business Center Phase II -
24,475  square feet,  University  Business  Center Phase I - 10,830 square feet,
Lakeshore  Business  Center Phase I - 6,748 square feet and  Lakeshore  Business
Center Phase II - 15,316  square  feet).  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.

On June 28, 1996, the Partnership  established an Interest Repurchase Reserve in
the amount of $50,000 pursuant to Section 16.4 of the Partnership's  Amended and
Restated Agreement of Limited Partnership.  Under Section 16.4, limited partners
may request the Partnership to repurchase their respective  interests (Units) in
the Partnership. With this Interest Repurchase Reserve, the Partnership was able
to repurchase  370 Units at a price of $135 per Unit. The  Partnership  notified
the limited  partners by letter dated February 1, 1996 of the  establishment  of
the  Interest  Repurchase  Reserve  and the  opportunity  to  request  that  the
Partnership  repurchase Units at the established  price. On August 30, 1996, the
Partnership  elected to fund an  additional  $50,000 to its Interest  Repurchase
Reserve.  With this  funding,  the  Partnership  will be able to  repurchase  an
additional  370 Units at a price of $135 per Unit. As of September 30, 1996, 422
units have been  repurchased.  Repurchased Units are retired by the Partnership,
thus  increasing  the  share  of  ownership  of  each  remaining  investor.  The
Partnership funded the Interest Repurchase Reserve from cash reserves.

It is anticipated  that the cash flow from  operations and cash reserves will be
sufficient to meet the needs of the Partnership.

                                      -17-

<PAGE>




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

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 Phases I and 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
renewals with current tenants and manages local  advertising with the assistance
of  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 $2.3  million is land  cost,  capitalized
interest and common area costs. The Partnership  plans to use the remaining land
to build University Business Center Phase III but this decision will be based on
market  conditions,  availability of financing and availability of the necessary
resources from the Partnership.

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 September 30, 1996 in the land held for
development is  approximately  $1.1 million.  The Joint Venture  currently has a
contract for the sale of .7 acres of this land for $175,000.


                                      -18-

<PAGE>



PART II. OTHER INFORMATION


1.       Legal Proceedings

         None

2.       Changes in Securities

         None

3.       Defaults upon Senior Securities

         None

4.       Submission of Matters to a Vote of Security Holders

         None

5.       Other Information

         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  September  4, 1996 to report in Item 5 the
                  Partnership's  election to fund an  additional  $50,000 to its
                  Interest Repurchase Reserve.

                                      -19-

<PAGE>



                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) 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.



                                       NTS-PROPERTIES V
                                a Maryland Limited Partnership
                                         (Registrant)

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

                                         /s/ John W. Hampton
                                         -------------------------
                                         John W. Hampton
                                         Senior Vice President


Date:                November 11         , 1996
             --------------------------


                                      -20-

<PAGE>