<PAGE>   1
                                                                   EXHIBIT 10.11



                                        December 30, 1996



Sunrise Assisted Living Limited Partnership
c/o Sunrise Retirement Homes and Communities
9401 Lee Highway, Suite 300
Fairfax, Virginia 22031

Attn:    Paul J. Klaassen, Chairman

         Re:     $95,000,000 loan (the "Loan") to Sunrise Assisted Living
                 Limited Partnership ("SALLP") from General Electric Capital
                 Corporation ("GECC") with respect to 12 assisted living
                 properties (the "Properties").

Dear Paul:

         Reference is hereby made to the Loan from GECC ("Prior Lender") to
SALLP ("Borrower") which Loan is evidenced and secured, in part, by the Amended
and Restated Promissory Note dated June 6, 1996 (the "Note"), from Borrower to
Prior Lender, in the maximum principal amount of $87,000,000.  Reference is
also hereby made to that certain letter from Prior Lender to Borrower dated May
1, 1996 (the "Transfer Letter", a copy of which is attached to this letter).
All capitalized terms used herein shall have the respective meanings ascribed
to such terms in the Note, unless otherwise defined herein.

         Pursuant to condition (ii) set forth in the Transfer Letter, Prior
Lender requires, as one of the conditions to Sunrise Assisted Living, Inc.
("SALI") constituting a "Permitted Owner" under Section 1.23 of the mortgages
and deeds of trust securing the Loan, that Paul J. Klaassen and/or Teresa
Klaassen would retain ownership of at least 25% of the shares of common stock
of SALI outstanding from time to time, with the full unrestricted authority and
right to freely vote such shares, including without limitation, in connection
with the election of members of the Board of Directors of SALI (condition ii)
being referred to herein as the "Klaassen Ownership Condition").  You have
requested that Great Oak, L.L.C., a Delaware limited liability company ("Great
Oak"), which has succeeded, by assignment, to Prior Lender's interest in the
Loan and the Loan Documents, waive and release the Klaassen Ownership Condition
in order to permit Paul J. Klaassen and/or Teresa Klaassen to make certain
charitable contributions of the shares of common stock of SALI owned and held
by Paul J. Klaassen and/or Teresa Klaassen and to permit such stock to be used
in connection with certain employee stock option programs.
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Sunrise Assisted Living Limited Partnership
December 30, 1996
Page 2


         Subject to all of the terms, conditions, and limitations set forth
herein, the Klaassen Ownership Condition shall not be a condition to SALI
constituting a "Permitted Owner" (as such term is defined in Section 1.23 of
the mortgages and deeds of trust securing the Loan) under Section 1.23 of the
mortgages and deeds of trust securing the Loan.  Nothing herein shall release
any other condition set forth in the Transfer Letter and in the event that one
or more of the conditions, other than the Klaassen Ownership Condition, set
forth in the Transfer Letter are not satisfied at any time prior to the
repayment in full of the Loan and all amounts owed in connection therewith,
SALI shall not constitute a "Permitted Owner" and Great Oak reserves all rights
and remedies available to it under applicable law and pursuant to the documents
evidencing, securing and setting forth the terms of the Loan (the "Loan
Documents") as a result of a transfer to a person or entity which is not a
"Permitted Owner" in violation of Section 1.23 of the mortgages and deeds of
trust securing the Loan.

         This letter and the agreements of Great Oak contained herein shall not
constitute (i) a waiver, release, amendment or modification of any of the terms
and provisions of the Loan Documents, including, without limitation, Section
1.23 of the mortgages and deeds of trust securing the Loan, or (ii) a course of
conduct, dealing or performance.  By your execution below you agree that the
waiver granted hereby is a one-time, limited waiver and shall be narrowly
construed.  We shall not be obligated to grant any further waivers with regard
to the same or related subject matters and no waiver shall be effective unless
in writing.  By your execution below you agree to pay all of GECC's and Great
Oak's costs and expenses in connection with this letter, including, without
limitation, legal fees and expenses.

         At our option this letter shall terminate and be of no further force
and effect unless this letter is executed by Borrower, the indemnitors (on the
acknowledgment attached hereto) and the guarantor (on the acknowledgment
attached hereto) and returned to us on or before December 31, 1996.


                  (REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)
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Sunrise Assisted Living Limited Partnership
December 30, 1996
Page 3





                             Sincerely,


                             Great Oak, L.L.C., a Delaware limited liability
                             company

                             By: General Electric Capital Corporation,
                                 a New York corporation, its manager


                                 By:           /s/ David B. Henry
                                      -----------------------------------------
                                 Name:         David B. Henry
                                      -----------------------------------------
                                 Its:          Vice President
                                      -----------------------------------------



The terms and conditions of this letter
are accepted and agreed to:

SUNRISE ASSISTED LIVING LIMITED PARTNERSHIP,
a Virginia limited partnership

         By:       /s/ Paul J. Klaassen
              ------------------------------
         Name:         Paul J. Klaassen
              ------------------------------
         Its:          Chairman
              ------------------------------

         Dated as of December 31, 1996
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Sunrise Assisted Living Limited Partnership
December 30, 1996
Page 4



                  Acknowledgment and Agreement by Indemnitors

         Each of the undersigned, an indemnitor under the Indemnity Agreement
and Hazardous Substance Indemnity both dated June 8, 1994 and executed in
connection with the Loan referenced in the foregoing letter, joins in the
execution of the letter to acknowledge its terms and agrees that the terms and
conditions of the foregoing letter shall not modify, amend, affect or diminish
any of the obligations or liabilities of the indemnitors under the Indemnity
Agreement or under the Hazardous Substance Indemnity.

         Dated as of December 31, 1996.



  /s/ Paul J. Klaassen                               /s/ Teresa M. Klaassen
--------------------------                       ------------------------------
Paul J. Klaassen                                 Teresa M. Klaassen





                   Acknowledgment and Agreement by Guarantor

         The undersigned, guarantor under the Guaranty dated as of February 15,
1996 ("Second STI Guaranty") and executed in connection with the Loan
referenced in the foregoing letter, joins in the execution of the letter to
acknowledge its terms and agrees that the terms and conditions of the foregoing
letter shall not modify, amend, affect or diminish any of the obligations or
liabilities of the guarantor under the Second STI Guaranty.

         Dated as of December 31, 1996.

         Sunrise Terrace, Inc.
         a Virginia corporation


         By:                /s/ Thomas B. Newell
             ------------------------------------------------
         Name:             Thomas B. Newell
             ------------------------------------------------
         Its:           Executive Vice President
             ------------------------------------------------