FORM 10-Q



Printable Version


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark one)

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

For quarterly period ended March 31, 2002

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: 000-32227

America First Real Estate Investment Partners, L.P.
(Exact name of registrant as specified
in its Agreement of Limited Partnership)

Delaware                                                                               39-1965590
(State or other jurisdiction of			                    (I.R.S. Employer
incorporation or organization)			                     Identification No.)

Suite 400, 1004 Farnam Street, Omaha, Nebraska        68102
(Address of principal executive offices)		            (Zip Code)

(402) 444-1630
(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Yes X   No





AMERICA FIRST REAL ESTATE INVESTMENT PARTNERS, L.P.

INDEX



PART I FINANCIAL INFORMATION

ITEM 1 FINANCIAL STATEMENTS

Consolidated Balance Sheets as of March 31, 2002 (Unaudited)
  and December 31, 2001

Consolidated Statements of Operations for the three months ended
  March 31, 2002 and 2001

(Unaudited)

Consolidated Statement of Partners' Capital (deficit) for the
  three months ended March 31, 2002

(Unaudited)

Consolidated Statements of Cash Flows for the three months ended
  March 31, 2002 and 2001

(Unaudited)

Notes to Consolidated Financial Statements (Unaudited)

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

ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
  RISK

PART II OTHER INFORMATION

SIGNATURES



Part I. Financial Information

Item 1. Financial Statements

AMERICA FIRST REAL ESTATE INVESTMENT PARTNERS, L.P. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS









AMERICA FIRST REAL ESTATE INVESTMENT PARTNERS, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE
  INCOME

(UNAUDITED)



The accompanying notes are an integral part of the consolidated financial statements.





AMERICA FIRST REAL ESTATE INVESTMENT PARTNERS, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL
  (DEFICIT)

FOR THE THREE MONTHS ENDED MARCH 31, 2002

(UNAUDITED)





AMERICA FIRST REAL ESTATE INVESTMENT PARTNERS, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)





AMERICA FIRST REAL ESTATE INVESTMENT PARTNERS, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(UNAUDITED)





1. Basis of Presentation

The consolidated financial statements include the accounts of the Company and its subsidiaries.  All significant intercompany transactions and accounts have been eliminated in consolidation.



The accompanying interim unaudited consolidated financial statements have been prepared according to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted according to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading.  The consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2001.  In the opinion of management, all normal and recurring adjustments necessary to present fairly the financial position at March 31, 2002, and the results of operations for all periods presented have been made.  The results of operations for the three-month period ended March 31, 2002 are not necessarily indicative of the results to be expected for the full year.  Certain amounts from the prior period have been reclassified to conform to the current period presentation.



The preparation of financial statements in conformity with GAAP 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.  Business Combinations

On January 1, 2002, the Company acquired the general partner
  interests in eight of the ten Operating Partnerships from its General Partner
  for no consideration. As a result of this acquisition, the Company now owns
  100% of the eight Operating Partnerships, and presents the results of each Operating
  Partnership as a wholly owned subsidiary from the date of acquisition. Prior
  to the acquisition, the Company owned only the limited partnership interests
  of the eight Operating Partnerships, which ranged from 98.99%-99.99%.



The acquisition of the general partner interests of each of
  the eight Operating Partnerships was accounted for as a step acquisition in
  accordance with purchase accounting, and each was recorded at its estimated
  fair market value. The estimated fair value was calculated by discounting the
  estimated future cash flows of each real estate property using current capitalization
  and market discount rates, and multiplying the general partner ownership percentage
  (ranging from .01% to 1%) by the estimated fair value of the net assets in each
  of the eight Operating Partnerships. The aggregate estimated fair value of the
  general partner interests acquired on January 1, 2002 was approximately $309,000,
  which is allocated 100% to reduce the Company's investment in real estate and
  will be depreciated on a straight line basis over 27.5 years.



The following presents the unaudited consolidated proforma results of operations of the Company for the three months ended March 31, 2001 as if the Company had acquired the general partner interests on January 1, 2001.







On March 26, 2002, the Company acquired the Glades Apartments,
  a 360 unit apartment property located in Jacksonville, Florida. The $15.1 million
  acquisition was financed through the assumption of bonds payable of $8.8 million
  and cash of approximately $6.3 million.

3. Investment in Real Estate

The Company's investment in real estate is comprised of the following:





A reconciliation of investment in real estate is as follows:



4. Bonds and Mortgage Payable

Bonds and mortgages payable at March 31, 2002 consisted of the following:





5.  Borrowings Under Repurchase Agreements

The Company has borrowed against certain of its GNMA Certificates using repurchase
  agreements. The following table shows the terms of the borrowings outstanding
  at March 31, 2002.







The GNMA Certificates, backed by first mortgage loans on Monticello Apartments, The Ponds at Georgetown, and Misty Springs Apartments, are eliminated in the consolidation process of the Company's consolidated financial statements.  The GNMA Certificates provide the Company with the guarantee by GNMA as to the full and timely payment of principal and interest on the underlying loans.

6.  Transactions with Related Parties

Substantially all of the Company's general and administrative expenses and certain costs capitalized by the Company are paid by the General Partner or an affiliate and reimbursed by the Company.

The Company pays the General Partner an administrative fee in connection with the ongoing administration of the business of the Company in an amount equal to 0.50%, per annum, of the sum of: (i) the fair market value on the Merger date of the original assets that are still owned by the Company; plus (ii) the purchase price paid by the Company for new assets that are then held by the Company.  The first $100,000 of the administrative fee is payable each year, with the balance payable only during years that funds from operations ("FFO"), calculated before administrative fees, exceeds 7% of the Unit holders' average capital for that year.  FFO represents net income (or loss) (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and sales of properties, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets) and after adjustments for unconsolidated partnerships and joint ventures.  Such administrative fees are paid on a monthly basis and were $129,942 and $80,100  for the three months ended March 31, 2002 and 2001, respectively.



The Company pays the General Partner an acquisition fee in
  connection with the identification, evaluation and acquisition of new assets
  and the financing thereof in an amount equal to 1.25% of the aggregate purchase
  price paid by the Company for such new assets. The acquisition fee with respect
  to an acquisition of a new asset is payable at the time of the closing of the
  acquisition and is capitalized. The General Partner received an acquisition
  fee of $186,197 for the first quarter of 2002 in connection with the acquisition
  of The Glades Apartments. No such fees were payable to the General Partner during
  the first quarter of 2001 as the Company did not acquire new assets during this
  period.



7.  Segment Reporting



The revenues, net operating income and assets for the Company's reportable segment as of and for the three month periods ending March 31, 2002 and 2001 are summarized as follows:





The Company does not derive any of its consolidated revenues from foreign countries and does not have any major customers that individually account for 10% or more of the Company's consolidated revenues.



8. Investment in Operating Partnerships

The Company's investment in Operating Partnerships consists of interests in limited partnerships which own multifamily properties financed by certain GNMA Certificates owned by the Company.



As described in note 2 to the consolidated interim financial statements, the Company acquired the general partner interests of eight of the Operating Partnerships on January 1, 2002.  As a result, the multifamily properties in the eight operating partnership's are now consolidated in the consolidated financial statements of the Company.



At March 31, 2002, the Company continues to own limited partnership interests in two Operating Partnerships, Crane's Landing Partners, Ltd., and Water's Edge Limited Partnership, which continue to be accounted for using the equity method.



A reconciliation of the Company's investment in Operating Partnership's is as follows:



9. New Accounting Pronouncements

In July 2001, the Financial Accounting Standards Board (FASB)
  issued Financial Accounting Standards (FAS) No. 141, "Business Combinations"
  and FAS No. 142, "Goodwill and Other Intangible Assets" which provide guidance
  on how entities are to account for business combinations and for the goodwill
  and other intangible assets that arise from those combinations or are acquired
  otherwise. The adoption of this standard on January 1, 2002 did not have an
  impact on the Company's consolidated financial statements. FAS 142 requires
  that goodwill no longer be amortized, but instead be tested for impairment at
  least annually. As of the date of adoption, the company had unamortized goodwill
  of approximately $899,000. Amortization expense related to such goodwill was
  approximately $36,000 for the year ended December 31, 2001. The impact of adoption
  of the new pronouncements did not have a significant effect on the consolidated
  financial statements of the Company.

In October 2001, the FASB issued FAS No. 144, "Accounting for the Impairment of Long-Lived Assets", which provides guidance on the accounting of long-lived assets to be held and used or to be disposed of and the reporting of discontinued operations.  The adoption of this standard on January 1, 2002 did not have an impact on the consolidated financial statements of the Company.

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

The following discussion should be read in conjunction with all of the consolidated financial statements and notes thereto included in Item 1 of this report as well as the Company's Annual Report on Form 10-K for the year ended December 31, 2001.

Results of Operations

Since the date of the Merger of the Company from the prior
  limited partnerships (December 31, 2000), the Company continues to implement
  its growth strategy of acquiring additional real estate investments. Since such
  date, the Company has acquired three multifamily real estate properties containing
  862 units and has acquired control of eight of the ten Operating Partnerships.



During 2001, the Company's General Partner continued to make progress toward acquiring control of the ten individual Operating Partnerships in which it has investments.  By the end of the year, the Company's General Partner ("America First") controlled eight of the ten Operating Partnerships.



On January 1, 2002, the Company acquired full ownership and
  control of the eight Operating Partnerships from America First. As a result
  of this acquisition, the Company now owns 100% of the eight Operating Partnerships
  and presents the results of each as a wholly owned subsidiary from the date
  of acquisition. Prior to the acquisition, the Company owned only the limited
  partnership interests of the eight Operating Partnerships, which ranged from
  98.99%-99.99%. The presentation of the real estate operations on a consolidated
  basis provides a more meaningful understanding of the Company's business and
  financial results, and the proforma effects of the transaction for the previous
  quarter end are also discussed herein to facilitate a complete understanding
  of the Company's financial results.



As a result of this transaction, and an additional acquisition described below, the Company directly owns 11 multifamily residential properties at March 31, 2002 and continues to own 99% limited partnership interests in two Operating Partnerships, Crane's Landing and Water's Edge Apartments, for a total of 13 multifamily residential properties.



On March 26, 2002, the Company acquired the Glades Apartments,
  a 360 unit apartment property located in Jacksonville, Florida. The $15.1 million
  acquisition was financed through the assumption of bonds payable of $8.8 million
  and cash of approximately $6.3 million.



The following table sets forth certain information regarding
  the Company's real estate at March 31, 2002:



The Company's operating results depend primarily on the net
  operating income generated by its multifamily properties. Net operating income
  represents rental revenues less real estate operating expenses and is substantially
  influenced by supply of and demand for apartment units and operating expenses.
  Starting in 2001, the national economy, as well as markets in which certain
  of the Company's properties operate, experienced a general downturn. This downturn
  has had an effect on the netrental revenue and occupancy
  levels of the Company's properties. The Company has also experienced an increase
  in operating expenses due to significant increases in insurance costs and increased
  costs to rent vacant apartments. In addition, home ownership has become a reality
  to many of the Company's prospective tenants due to record low mortgage interest
  rates causing additional tenant competition. These factors began to affect the
  financial results of the Company in the fourth quarter of 2001, and have continued
  into the first quarter of 2002. As a result of these factors, the Company experienced
  an overall net decline in rental income and a net increase in rental expenses.

Three Months Ended March 31, 2002 Compared to Three Months Ended March 31,
  2001

The Company earned rental income of $3,649,743  during the first quarter of 2002, which is attributable to the 2001 acquisitions of Brentwood Oaks Apartments, Huntsview Apartments and the January 1, 2002 acquisition of the general partner interests in eight of the Operating Partnerships.  The Company did not directly own any properties during the first quarter of 2001 and accordingly did not earn rental income during this period.  On a proforma basis, the Company's rental income increased $890,382 or 32% for the first quarter of 2002 compared to the first quarter of 2001.  This is primarily attributable to the 2001 acquisitions of Brentwood Oaks Apartments and Huntsview Apartments.



Equity in the earnings of Operating Partnerships increased
  $52,729 for the three months ended March 31, 2002 compared to the three months
  ended March 31, 2001. This increase is primarily due to the acquisition of the
  general partner interests in eight of the Operating Partnerships on January
  1, 2002.



Mortgage-backed securities income decreased $1,030,961 or 76% for the first quarter of 2002 compared to the first quarter of 2001 as a result of the acquisition of the general partners of eight of the Operating Partnerships and the related elimination entries during consolidation.  On a proforma basis, mortgage-backed securities income decreased $1,899 or 1% for the first quarter of 2002 compared to the first quarter of 2001.



Interest income on cash and cash equivalents decreased $99,878 or 81% for the first three months of 2002 compared to the same period in 2001 due to a decrease in the average balance of such investments and the decrease in rates earned thereon.  The average annualized interest rate earned on cash and cash equivalents was 1.93% for the first quarter of 2002, compared to 5.7% for the first quarter of 2001.



Dividend income from the Company's investment in corporate equity securities increased $43,223 for the quarter ended March 31, 2002 compared to the first quarter of 2001 due to additional acquisitions during 2001 and the first quarter of 2002.



The Company incurred real estate operating expenses of $1,722,441 during the first quarter of 2002, which are attributable to the 2001 acquisitions of Brentwood Oaks Apartments and Huntsview Apartments, and the January 1, 2002 acquisition of the general partner interests in eight of the Operating Partnerships.  The Company did not directly own any properties during the quarter ended March 31, 2001 and, accordingly, did not incur real estate operating expenses during this period.  On a proforma basis, real estate operating expenses increased $518,424 or 43% for the first quarter of 2002 compared to the first quarter of 2001.  This increase is primarily due to the acquisitions of Brentwood Oaks Apartments and Huntsview Apartments during 2001.



The Company incurred depreciation expense of $664,357 during
  the first quarter of 2002, which is attributable to the 2001 acquisitions of
  Brentwood Oaks Apartments and Huntsview Apartments, and the January 1, 2002
  acquisition of the general partner interests in eight of the Operating Partnerships.
  On a proforma basis, depreciation expense increased $343,033 during the first
  quarter of 2002 compared to the first quarter of 2001. This increase is attributable
  to the 2001 acquisitions of Brentwood Oaks Apartments and Huntsview Apartments.



The Company incurred interest expense of $479,661 during the three months ended March 31, 2002 as follows: (i) $273,739 on its bonds and mortgages payable; (ii) $26,042 on Notes payable which originated in connection with the Merger; and (iii) $179,880 on the Company's repurchase obligations.  During the three months ended March 31, 2001, the Company incurred interest expense of $165,288, consisting of interest expense of $104,218 on its repurchase agreements and interest expense of $61,070 on notes payable which originated in connection with the Merger.  The interest expense increase on the bonds and mortgages payable is due to an increase in bonds and mortgages payable outstanding from the January 1, 2002 acquisition of the general partner interests in eight of the Operating Partnerships and the 2001 acquisitions of Brentwood Oaks Apartments and Huntsview Apartments.  The increase in the repurchase agreement interest expense is due to an increase in the outstanding borrowings under repurchase agreements.  The decrease in interest expense of the Notes payable is due to a decline in the variable rate on which such interest is calculated.



Operating and administrative expenses increased $37,472 for the first quarter of 2002 compared to the same period in 2001.  This is primarily attributable to increases in asset management fees related to the acquisitions of Brentwood Oaks Apartments and Huntsview Apartments in 2001.

Funds From Operations

The Company considers Funds From Operations ("FFO") to be a key measure of its performance and should be considered along with, but not as an alternative to, net income and cash flow as a measure of the Company's operating performance and liquidity.



FFO increased $565,976 or 59% to $1,524,859 for the first quarter
  of 2002, compared to $958,883 for the same period in 2001, which is attributable
  to acquisitions of investment in real estate. On a proforma basis, FFO increased
  $92,855 or 7% for the first quarter of 2002 compared to the first quarter of
  2001.

The White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT") in October 1999 defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and sales of properties, plus real estate related depreciation and amortization (excluding amortization of deferred financing cost) and after comparable adjustments for an entity's portion of these items related to unconsolidated entities and joint ventures.  The Company computes FFO in accordance with standards established by NAREIT which may not be comparable to FFO reported by other entities that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than the Company.  FFO does not represent cash generated from operating activities determined by GAAP and should not be considered as an alternative to GAAP net income as an indication of the Company's financial performance or to GAAP cash flow from operating activities as a measure of the Company's liquidity, nor is it indicative of funds available to fund the Company's cash needs, including its ability to make cash distributions.  FFO may include funds that may not be available for management's discretionary use due to functional requirements to conserve funds for capital expenditures and property acquisitions, and other commitments and uncertainties.



Liquidity and Capital Resources



The Company's net cash generated by operating activities increased
  to $1,039,005 for the three months ended March 31, 2002, compared to $193,411
  for the three months ended March 31, 2001, principally due to property acquisitions
  and changes in operating liabilities. Net cash used in investing activities
  increased to $4,091,671 for the three months ended March 31, 2002 compared to
  $1,121,139 for the three months ended March 31, 2001 due to the acquisition
  of the Glades Apartments in March 2002. The Company's net cash provided by financing
  activities increased to $3,880,666 for the three months ended March 31, 2002
  compared to $43,847 for the three months ended March 31, 2002, due to the special
  distributions made in the first quarter of 2001 and an increase in proceeds
  from borrowings under repurchase agreements.



The amount of operating cash generated by the Company is substantially dependent on the net rental revenues generated by the properties.  Net rental revenues from a multifamily apartment complex depend on the rental and occupancy rates of the property and on the level of operating expenses.  Occupancy rates and rents are directly affected by the supply of, and demand for, apartments in the market areas in which a property is located.  This, in turn, is affected by several factors, such as: local or national economic conditions, the amount of new apartment construction and interest rates on single-family mortgage loans.  In addition, factors such as government regulation (such as zoning laws), inflation, real estate and other taxes, labor problems and natural disasters can affect the economic operations of a property.



The Company believes that cash provided by its real estate investments and investment income from its GNMAs and other investments, supplemented, if necessary, by cash-on-hand, will be adequate to meet its projected short-term and long-term liquidity requirements.  The Company's primary uses of cash are: (i) the payment of distributions to Unit holders; (ii) debt service; (iii) payment of operating expenses; and (iv) the acquisition of additional real estate investments.







The Company's growth strategy includes the acquisition of additional multifamily residential properties as well as debt and equity securities of entities engaged in similar activities, which will be funded from available cash and short-term investments, and from:  (i)  borrowing against or sale of the existing properties; (ii) borrowing against or sale of the GNMA Certificates; and (iii) borrowing against the additional properties acquired by the Company.  The Company may also use additional sources of financing, both debt and equity, to further its business objectives and investment strategies.



During January 2002, the Company renewed a repurchase agreement, borrowing against one of its GNMA Certificates in the amount of $9,500,000.  The repurchase agreement bears interest at a fixed rate of 2.28% per annum and matures on January 21, 2003.

During March 2002, the Company borrowed $5,000,000 against one of its GNMA Certificates through the utilization of a repurchase agreement.  The repurchase agreement bears interest at a fixed rate of 2.83% per annum and matures on March 12, 2003.

During March 2002, the Company assumed $8,865,000 in bonds
  payable in connection with the acquisition of The Glades Apartments. The bonds
  bear interest at a fixed rate of 6.10% per annum and mature on October 1, 2002.

Forward Looking Statements

This report contains forward-looking statements that reflect
  management's current beliefs and estimates of future economic circumstances,
  industry conditions, the Company's performance and financial results. All statements,
  trend analysis and other information concerning possible or assumed future results
  of operations of the Company and the real estate investments it has made (including,
  but not limited to, the information contained in "Management's Discussion and
  Analysis of Financial Condition and Results of Operations"), constitute forward
  looking statements. Unit holders and others should understand that these forward
  looking statements are subject to numerous risks and uncertainties, and a number
  of factors could affect the future results of the Company and could cause those
  results to differ materially from those expressed in the forward looking statements
  contained herein.

Item 3. Quantitative and Qualitative Disclosures
  About Market Risk

The Company's primary market risk exposure is interest rate risk.  The Company's exposure to market risk for changes in interest rates relates primarily to its long and short-term borrowings used to fund expansion of the Company's real estate portfolio and its variable rate Notes payable. The Company's interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows and lower its overall borrowing costs.  To achieve its objectives, the Company borrows primarily at fixed rates and may enter into derivative financial instruments, such as interest rate caps, in order to mitigate its interest rate risk.  The Company does not enter into derivative instrument transactions for speculative purposes.



Interest rate risk is highly sensitive to many factors, including governmental, monetary and tax policies, domestic and international economic and political considerations and other factors beyond the Company's control.  The potential for significant volatility in the interest rate markets was especially displayed during 2001, when the Federal Reserve Board decreased the federal funds rate eleven times.

At March 31, 2002, approximately 77% of the Company's borrowings
  consisted of fixed-rate financing. The remaining 23% consisted of variable-rate
  financing. Variations in interest rates affect the Company's cost of borrowing
  on its variable-rate financing. The interest rates payable by the Company on
  these obligations increase or decrease with certain index interest rates. If
  the Company's borrowing costs increase, the amount of cash available for distribution
  to Unit holders will decrease.



The following tables provide information at March 31, 2002 regarding the Company's financial instruments sensitive to interest rate risk:





As the above tables incorporate only those positions or exposures
  that existed as of March 31, 2002, it does not consider those exposures or positions
  that could arise after that date. The Company's ultimate economic impact with
  respect to interest rate fluctuations will depend on the exposures that arise
  during the period, the Company's risk mitigating strategies at that time and
  interest rates.



Part II. Other Information

Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits

The following exhibits are filed as required by this report.  Exhibit numbers refer to the paragraph numbers under Item 601 of Regulation S-K:



2(a) Agreement and Plan of Merger among the Company
          and Cap Source and Cap Source II (incorporated by reference to Appendix
          A to the Prospectus included in Registration Statement of Form S-4 (No.
          333-52117) filed by the Company on November 8, 1999).



4(a) Certificate of Limited Partnership of the Company
          (incorporated by reference to Exhibit 3.01 to Registration Statement
          on Form S-4 (No. 333-52117) filed by the Company on July 21, 1999).



4(b) Amended and Restated Agreement of Limited Partnership
          of the Company (incorporated by reference to Exhibit 3.02 to the Registration
          Statement on Form S-4 (No. 333-52117) filed by the Company on July 21,
          1999).

4(c) Form of Indenture between the Company and U.S.
          Bank Trust National Association, as trustee (incorporated by reference
          to Exhibit 4.02 to the Registration Statement on Form S-4 (No. 333-52117)
          filed by the Company on May 7, 1998).



4(d) Form of Unit Certificate of the Company (incorporated
          by reference to Exhibit 4.03 to the Registration Statement on Form S-4
          (No. 333-52117) filed by the Company on September 28, 1999).

4(e) Form of Variable Rate Junior Notes are included
          in Exhibit 4.02 (incorporated by reference to Exhibit 4.04 to the Registration
          Statement on Form S-4 (No. 333-52117) filed by the Company on May 7,
          1998).



10(a) Stipulation of Settlement. 
          IN THE CASE OF
          ALVIN M. PANZER and 
          SANDRA G. PANZER Plaintiffs,
          INSURED MORTGAGE EQUITIES, INC., 	INSURED MORTGAGE 
          EQUITIES II L.P., AMERICA FIRST CAPITAL 		
          SOURCE I, L.L.C., AMERICA FIRST 
          CAPITAL SOURCE II, L.L.C., AMERICA 
          FIRST	COMPANIES, L.L.C., AMERICA 
          FIRST REAL ESTATE INVESTMENT 
          PARTNERS, 	L.P., LEHMAN 
          BROTHERS, INC., CAPITAL SOURCE 
          L.P., PAUL L. ABBOTT, and CAPITAL 	
          SOURCE II, L.P.,
          Defendants.

(incorporated herein by reference to Form 10-Q dated March 31, 2000
          filed pursuant to Section 13 or 15(d)of the Securities Exchange Act
          of 1934 by the Company (Commission File No. 333-52117)).

(b)  Reports on Form 8-K



The Company did not file any reports on Form 8-K during
          the quarter for which this report is filed.





SIGNATURES

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

By America First Real Estate 
  	Investment Partners, L.P.

By America First Capital
  	Source I, L.L.C., General
  	Partner of the Company

By /s/ Michael Thesing
  	Michael Thesing,
  	Vice President, Secretary
  	and Treasurer



Date:  May  13, 2002