FORM 10-K --ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                                  WASHINGTON, D.C. 20549

                                    Form 10-K

[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934 [No Fee Required]

                       For the fiscal year ended December 31, 1999

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934 [No Fee Required]

                   For the transition period from _________to _________

                         Commission file number 0-11723

                     CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/2
                  (Exact name of registrant as specified in its charter)

         California                                               94-2883067
(State or other jurisdiction of                                (I.R.S. Employer
 incorporation or organization)                              Identification No.)

                          55 Beattie Place, PO Box 1089

                        Greenville, South Carolina 29602

                         (Address of principal executive offices)

                            Issuer's telephone number

                                 (864) 239-1000

              Securities registered under Section 12(b) of the Exchange Act:

                                      None

              Securities registered under Section 12(g) of the Exchange Act:

                            Limited Partnership Units

                                (Title of class)

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___

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation S-K (Sec.  229.405 of this chapter) is not contained  herein,  and
will not be contained,  to the best of the registrant's knowledge, in definitive
proxy or information  statements  incorporated  by reference in Part III of this
Form 10-K or any  amendment  to this Form 10-K.  (Amended  by Exch.  Act Rel No.
28869, eff. 5/1/91).

State the aggregate market value of the Limited Partnership Units ("Units") held
by  non-affiliates  computed by reference to the price at which the  partnership
interests  were sold,  or the average bid and asked  prices of such  partnership
interests as of December 31, 1999. No market exists for the limited  partnership
interests of the Registrant,  and,  therefore,  no aggregate market value can be
determined.

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None


                                     PART I

Item 1.  Description of Business

General

Consolidated   Capital   Institutional   Properties/2   (the   "Partnership"  or
"Registrant")  was organized on April 12, 1983, as a limited  partnership  under
the  California  Uniform  Limited   Partnership  Act.  On  July  22,  1983,  the
Partnership registered with the Securities and Exchange Commission ("SEC") under
the  Securities Act of 1933 (File No.  2-83540) and commenced a public  offering
for the sale of Units.  The Units represent  equity interests in the Partnership
and  entitle the  holders  thereof to  participate  in certain  allocations  and
distributions of the Partnership. The sale of Units terminated on July 21, 1985,
with 912,182 Units sold at $250 each, or gross proceeds of approximately  $227.8
million to the  Partnership.  As permitted under its Partnership  Agreement (the
original  partnership  agreement of the Partnership with all amendments shall be
referred to as the "Partnership Agreement"), the Partnership has repurchased and
retired a total of 3,048 Units for a total of $611,000.  During 1999, 10.4 units
were abandoned and accordingly retired by the Partnership.  The Partnership may,
at its absolute  discretion,  repurchase Units, but is under no obligation to do
so. Since its initial offering, the Registrant has not received, nor are limited
partners required to make, additional capital contributions.

Upon the Partnership's formation in 1983, CCEC, a Colorado corporation,  was the
corporate general partner. In 1988, through a series of transactions,  Southmark
Corporation  ("Southmark")  acquired  controlling  interest in CCEC. In December
1988,  CCEC filed for  reorganization  under  Chapter  11 of the  United  States
Bankruptcy Code ("Chapter 11"). In 1990, as part of CCEC's  reorganization plan,
ConCap  Equities,  Inc. ("CEI" or the General  Partner)  acquired CCEC's general
partner  interests in the Partnership and in 15 other affiliated  public limited
partnerships (the "Affiliated  Partnerships")  and CEI replaced CCEC as managing
general  partner in all 16  partnerships.  The  selection  of CEI as the general
partner was  approved by a majority of the limited  partners in the  Partnership
and in each of the Affiliated  Partnerships  pursuant to a  solicitation  of the
Limited  Partners  dated  August 10,  1990.  As part of this  solicitation,  the
Limited  Partners  also  approved an amendment to the  Partnership  Agreement to
limit changes of control of the Partnership. The General Partner is a subsidiary
of Apartment  Investment  and  Management  Company  ("AIMCO").  The  Partnership
Agreement  provides  that the  Partnership  is to terminate on December 31, 2013
unless terminated prior to such date.

Several tender offers were made by various parties,  including affiliates of the
General  Partner,  during the years ended December 31, 1999, 1998 and 1997. As a
result of these tender offers, AIMCO and its affiliates currently own 370,955.70
units  of  limited   partnership   interest  in  the  Partnership   representing
approximately  40.80% of the outstanding units. It is possible that AIMCO or its
affiliates will make one or more additional offers to acquire additional limited
partnership  interests in the  Partnership  for cash or in exchange for units in
the  operating  partnership  of AIMCO.  Consequently,  AIMCO is in a position to
significantly  influence all voting  decisions  with respect to the  Registrant.
Under the Partnership Agreement, unitholders holding a majority of the Units are
entitled  to take action  with  respect to a variety of matters.  When voting on
matters,  AIMCO would in all  likelihood  vote the Units it acquired in a manner
favorable to the interest of the General  Partner  because of their  affiliation
with the General Partner.

The  Partnership's  primary  business and only  industry  segment is real estate
related  operations.  See "Item 8.  Financial  Statements - Note A" for detailed
disclosure of the Partnership's  Segment Reporting.  The Partnership was formed,
for the benefit of its Limited  Partners (herein so called and together with the
General  Partner  shall be  called  the  "Partners"),  to lend  funds to  Equity
Partners/Two  ("EP/2"), a California general partnership in which certain of the
partners were former  shareholders  and former  management  of CCEC,  the former
corporate general partner of the Partnership.  See "Status of Master Loan" for a
description of the loan and settlement of EP/2's  bankruptcy.  Through  December
31, 1999, the Partnership had advanced a total of approximately  $183,470,000 to
EP/2 and its  successor  under the Master  Loan (as defined in "Status of Master
Loan").  As of December  31, 1999,  the balance of the Master  Loan,  net of the
allowance for possible  losses,  was  approximately  $18,374,000.  EP/2 used the
proceeds  from these loans to acquire  eleven (11)  apartment  buildings and ten
(10) office complexes, which collateralized the Master Loan. EP/2's successor in
bankruptcy (as more fully  described in "Status of Master Loan")  currently owns
four (4) apartment buildings which secure the Master Loan.

The Registrant  has no employees.  Management  and  administrative  services are
performed by the General Partner and by agents of the General Partner.

Status of Master Loan

Prior  to  1989,  the  Partnership  had  loaned  funds  totaling   approximately
$176,000,000 to EP/2 subject to a nonrecourse note (the "Master Loan"), pursuant
to the Master Loan Agreement  dated July 22, 1983,  between the  Partnership and
EP/2. The  Partnership  secured the Master Loan with deeds of trust or mortgages
on real property  purchased with the funds advanced as well as by the assignment
and pledge of promissory notes from the partners of EP/2.

During 1989, EP/2 defaulted on certain interest payments that were due under the
Master  Loan.  Before the  Partnership  could  exercise  its  remedies  for such
defaults,  EP/2 filed for bankruptcy  protection in a Chapter 11  reorganization
proceeding. On October 18, 1990, the bankruptcy court approved EP/2's consensual
plan of reorganization  (the "Plan"). In November 1990, EP/2 and the Partnership
consummated a closing under the Plan pursuant to which,  among other things, the
Partnership  and EP/2 executed an amended and restated loan  agreement (the "New
Master  Loan  Agreement"),   EP/2  was  converted  from  a  California   general
partnership to a California  limited  partnership,  Consolidated  Capital Equity
Partners/Two,  L.P.,  ("CCEP/2")  and  CCEP/2  renewed  the  deeds of trust  and
mortgages  on all the  properties  collaterally  securing  the New  Master  Loan
Agreement.  ConCap Holdings,  Inc. ("CHI"), a Texas corporation and wholly-owned
subsidiary of CEI, is the sole general partner of CCEP/2 and an affiliate of the
Partnership. The general partners of EP/2 became limited partners in CCEP/2. CHI
has full  discretion  with respect to conducting  CCEP/2's  business,  including
managing CCEP/2's  properties and initiating and approving capital  expenditures
and asset  dispositions and refinancings.  Under the new partnership  agreement,
CCEP/2 is managed by CHI primarily for the benefit of the Partnership.  CCEP/2's
primary  objective  is to conduct its  business to  maximize  the  Partnership's
recovery under the New Master Loan Agreement.

Under the terms of the New Master Loan  Agreement,  interest  accrues at 10% and
payments are due  quarterly  in an amount  equal to Excess Cash Flow,  generally
defined in the New Master Loan Agreement as net cash flow from operations  after
third-party  debt  service  and capital  improvements.  If such Excess Cash Flow
payments are less than the current accrued interest during the quarterly period,
the unpaid interest is added to principal,  compounded annually,  and is payable
at the loan's  maturity.  If such Excess Cash Flow payments are greater than the
current accrued interest,  the excess amount is applied to the principal balance
of the loan.  Any net  proceeds  from  sale or  refinancing  of any of  CCEP/2's
properties  are paid to the  Partnership  under the terms of the New Master Loan
Agreement. The Master Loan matures in November 2000.

Effective  January 1, 1993,  the  Partnership  and CCEP/2 amended the New Master
Loan  Agreement  to  stipulate  that Excess  Cash Flow would be computed  net of
capital  improvements.  Such  expenditures were formerly funded from advances on
the Master Loan from the Partnership to CCEP/2. This amendment and change in the
definition   of  Excess  Cash  Flow  will  have  the  effect  of  reducing   the
Partnership's  interest  income  from the Master  Loan by the amount of CCEP/2's
capital  expenditures  since such amounts were  previously  excluded from Excess
Cash Flow.

Transfer of Control

Pursuant  to a series  of  transactions  which  closed  on  October  1, 1998 and
February 26, 1999,  Insignia Financial Group, Inc. and Insignia Properties Trust
merged into AIMCO, a publicly traded real estate  investment  trust,  with AIMCO
being the surviving  corporation  (the "Insignia  Merger").  As a result,  AIMCO
acquired 100% ownership  interest in the General  Partner.  The General  Partner
does not believe that this transaction has had or will have a material effect on
the affairs and operations of the Partnership.

Segments

Segment data for the years ended  December 31, 1999,  1998, and 1997 is included
in "Item 8.  Financial  Statements - Note A" and is an integral part of the Form
10-K.

Item 2.  Property

As of December 31, 1998 and 1999, the Partnership has no real estate assets.

Item 3.  Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the   Partnership,   the  General  Partner  and  several  of  their   affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging  the  acquisition  by Insignia  Financial  Group,  Inc.
("Insignia")  and  entities  which  were,  at one time,  affiliates  of Insignia
("Insignia  Affiliates") of interests in certain general partner entities,  past
tender offers by Insignia  Affiliates to acquire limited  partnership units, the
management of partnerships  by Insignia  Affiliates and the Insignia Merger (see
"Item 8.  Financial  Statements  Note B - Transfer of Control").  The plaintiffs
seek monetary damages and equitable relief,  including  judicial  dissolution of
the  Partnership.  On June 25, 1998, the General  Partner filed a motion seeking
dismissal of the action.  In lieu of  responding to the motion,  the  plaintiffs
have filed an amended  complaint.  The General  Partner  filed  demurrers to the
amended  complaint  which were heard February  1999.  Pending the ruling on such
demurrers,  settlement  negotiations commenced. On November 2, 1999, the parties
executed and filed a Stipulation of Settlement settling claims, subject to final
court approval,  on behalf of the  Partnership and all limited  partners who own
units as of  November  3,  1999.  Preliminary  approval  of the  settlement  was
obtained on November 3, 1999 from the Superior Court of the State of California,
County of San Mateo,  at which time the Court set a final  approval  hearing for
December  10, 1999.  Prior to the  December 10, 1999 hearing the Court  received
various  objections  to the  settlement,  including a  challenge  to the Court's
preliminary  approval  based  upon  the  alleged  lack  of  authority  of  class
plaintiffs'  counsel to enter the settlement.  On December 14, 1999, the General
Partner  and  its  affiliates   terminated  the  proposed  settlement.   Certain
plaintiffs have filed a motion to disqualify some of the plaintiffs'  counsel in
the action.  The General Partner does not anticipate that costs  associated with
this case will be material to the Partnership's overall operations.

The  Partnership is unaware of any other pending or outstanding  litigation that
is not of a routine nature arising in the ordinary course of business.

Item 4.  Submission of Matters to a Vote of Security Holders

During the quarter ended December 31, 1999, no matter was submitted to a vote of
the unit holders through the solicitation of proxies or otherwise.


<PAGE>


                                     PART II

Item 5.  Market  for  Registrant's  Units of  Limited  Partnership  and  Related
         Security Holder Matters

The Partnership,  a publicly-held limited partnership,  offered and sold 912,182
limited partnership units aggregating  $227,800,000.  The Partnership  currently
has 25,903 holders of record owning an aggregate of 909,123.60 Units. Affiliates
of the  General  Partner  owned  370,955.70  units or  approximately  40.80%  at
December 31, 1999. No public trading market has developed for the Units,  and it
is not anticipated that such a market will develop in the future.

The following table sets forth the distributions made by the Partnership for the
years ended December 31, 1997, 1998 and 1999.

                                                Distributions
                                                           Per Limited
                                        Aggregate        Partnership Unit

       01/01/97 - 12/37/97           $ 9,992,000 (1)         $ 10.98

       01/01/98 - 12/31/98             2,985,000 (2)            3.28

       01/01/99 - 12/31/99            37,995,000 (3)           41.73

(1)   Consists of $992,000 from operations which was distributed to all partners
      and $9,000,000 from  refinancing  proceeds of the CCEP/2  properties which
      was distributed 100% to the limited partners.

(2)  Distribution  was made from surplus funds which was distributed 100% to the
     limited partners.

(3)   Consists of $323,000 from surplus funds and $32,000,000 from sale proceeds
      of CCEP/2 commercial proceeds distributed 100% to the limited partners and
      $5,672,000 from operations distributed to all partners.

The Partnership's distribution policy is reviewed on a semi-annual basis. Future
cash  distributions  will  depend on  CCEP/2's  ability to make  payments on the
account of the Master Loan and the  availability of cash reserves.  There can be
no assurance,  however, that the Partnership will generate sufficient funds from
operations  to permit any  additional  distributions  to its partners in 2000 or
subsequent  periods.  In addition,  the  Partnership  is restricted  from making
distributions  if  reserves  equal  to  5%  of  Net  Invested  Capital  are  not
maintained.

Tender Offer

Several tender offers were made by various parties,  including affiliates of the
General  Partner,  during the years ended December 31, 1999, 1998 and 1997. As a
result of these tender offers, AIMCO and its affiliates currently own 370,955.70
limited  partnership  interest  in the  Partnership  representing  approximately
40.80% of the  outstanding  units.  It is possible that AIMCO or its  affiliates
will  make  one  or  more  additional  offers  to  acquire   additional  limited
partnership  interests in the  Partnership  for cash or in exchange for units in
the  operating  partnership  of AIMCO.  Consequently,  AIMCO is in a position to
significantly  influence all voting  decisions  with respect to the  Registrant.
Under the Partnership Agreement, unitholders holding a majority of the Units are
entitled  to take action  with  respect to a variety of matters.  When voting on
matters,  AIMCO would in all  likelihood  vote the Units it acquired in a manner
favorable to the interest of the General  Partner  because of their  affiliation
with the General Partner.


<PAGE>



Item 6.     Selected Financial Data

The  following  table sets forth a summary  of  certain  financial  data for the
Partnership.  This summary should be read in conjunction with the  Partnership's
financial   statements  and  notes  thereto  appearing  in  "Item  8.  Financial
Statements and Supplementary Data".

<TABLE>
<CAPTION>

                                          FOR THE YEARS ENDED DECEMBER 31,
                                 1999       1998        1997       1996        1995
STATEMENTS OF OPERATIONS
                                          (in thousands, except unit data)
<S>                           <C>       <C>         <C>       <C>          <C>

Total Revenues                $  1,328   $ 15,367    $  6,755   $  2,070    $  4,065

Total Expenses                    (520)      (820)       (480)    (2,649)     (6,681)

Net income (loss)             $    808   $ 14,547    $  6,275   $   (579)   $ (2,616)

Net income (loss) per
 Limited Partnership Unit     $    .88   $  15.84    $   6.83   $   (.63)   $  (2.85)

Distributions per Limited
  Partnership Unit            $  41.73   $   3.28    $  10.98   $     --    $   3.27

Limited Partnership Units
  outstanding                  909,124    909,134     909,134    909,138     909,138

                                                 AS OF DECEMBER 31,
BALANCE SHEETS                   1999       1998        1997       1996        1995
                                                   (in thousands)

Total assets                  $ 25,323   $ 62,466    $ 50,906   $ 54,636    $ 55,494

</TABLE>


<PAGE>





Item 7.    Management's   Discussion  and  Analysis of Financial  Condition  and
           Results of Operations

The  matters  discussed  in  this  Form  10-K  contain  certain  forward-looking
statements  and  involve  risks and  uncertainties  (including  changing  market
conditions, competitive and regulatory matters, etc.) detailed in the disclosure
contained  in this Form  10-K and the  other  filings  with the  Securities  and
Exchange  Commission made by the Registrant from time to time. The discussion of
the Registrant's business and results of operations,  including  forward-looking
statements pertaining to such matters, does not take into account the effects of
any changes to the Registrant's business and results of operations. Accordingly,
actual   results   could  differ   materially   from  those   projected  in  the
forward-looking  statements as a result of a number of factors,  including those
identified herein.

This item should be read in conjunction with the financial  statements and other
items contained elsewhere in this report.

Results of Operations

1999 Compared with 1998

The Partnership  realized net income of  approximately  $808,000 and $14,547,000
for the years ended  December 31, 1999 and 1998,  respectively.  The decrease in
net income is due to a decrease in total revenues,  which was slightly offset by
a decrease  in total  expenses.  The  decrease  in total  revenues is due to the
reduction of  provision  for  impairment  loss  recognized  during 1998 and to a
lesser extent a decrease in interest  income on net investment in Master Loan to
an affiliate and interest income on investments. As discussed in "Item 8. Note C
- Net Investment in Master Loan",  the Partnership  recorded  interest income of
approximately  $998,000 and $1,200,000 for the years ended December 31, 1999 and
1998,  respectively.  No reduction of allowance for impairment loss was recorded
for the  year  ended  December  31,  1999.  As the fair  value of the  remaining
collateral  properties  underlying the Master Loan did not significantly  change
from their fair value at  December  31,  1998,  no change to the  allowance  was
deemed necessary during 1999. Interest income on investments  decreased due to a
reduction in the cash  balance in  interest-bearing  money market  accounts as a
result of the  distributions to partners made during 1999. The decrease in total
revenues was partially  offset by a decrease in total expenses  resulting from a
decrease in general and administrative  expenses for the year ended December 31,
1999. General and administrative  expenses decreased primarily due to a decrease
in  reimbursements to the General Partner and a reduction in the amount of legal
fees incurred by the Partnership.

1998 Compared with 1997

The Partnership reported net income of approximately  $14,547,000 and $6,275,000
for the years ended  December 31, 1998 and 1997,  respectively.  The increase in
net income is due to an increase in total revenues which was slightly  offset by
an increase in total expenses.  The increase in revenues is due to the reduction
of provision for impairment  loss and to a lesser extent an increase in interest
income on net  investment in Master Loan to affiliate.  As discussed in "Item 8.
Note C - Net  Investment  in Master  Loan," the  Partnership  recorded  interest
income of  approximately  $1,200,000  and  $870,000  and recorded a reduction of
allowance for impairment  loss of  approximately  $13,586,000 and $5,328,000 for
the years ended  December 31, 1998 and 1997,  respectively.  The  allowance  for
impairment loss was reduced because the fair value of the collateral  properties
underlying the Master Loan was increased as a result of capital improvements and
repairs  performed  over the last few  years,  changing  market  conditions  and
improved  operations at such properties which include increased occupancy rates.
(See table and comments  below for details of the average  annual  occupancy and
rental rates for 1999, 1998 and 1997.) Without giving effect to the reduction of
provision for impairment loss, the Partnership generated net income for the year
ended  December  31, 1998 of $961,000 as compared to $947,000 for the year ended
December  31,  1997.  Expenses  increased  due to an  increase  in  general  and
administrative   expenses  resulting  from  increased  legal  fees.  Legal  fees
increased  due to the lawsuits  which have since been  finalized as disclosed in
previous quarters.

<TABLE>
<CAPTION>

                         1998 Average          1997 Average         1996 Average
                            Annual                Annual               Annual

                                 Rental                Rental               Rental
                    Occupancy     Rate     Occupancy    Rate    Occupancy    Rate
Residential
<S>                    <C>       <C>         <C>      <C>         <C>      <C>

Canyon Crest           96%       $ 8,776      96%     $ 8,485      95%     $ 8,100
Highcrest Townhomes    95%        10,298      95%       9,789      94%       9,559
Windmere               95%         7,106      95%       6,583      84%       5,985
Village Brooke         88%         7,700      90%       7,324      89%       7,116

Commercial (1) (2)

Lahser Center I        96%         14.10      96%        13.80     87%       12.06
Lahser Center II       95%         13.49     100%        13.33    100%       13.64
Crescent Centre        97%         12.42      86%        12.76     93%       10.91
Richmond Plaza         85%         12.58      89%        11.68     90%       11.40
Town Center Plaza      90%         13.98      75%        12.90     71%       13.43
Central Park Plaza     96%         15.02      97%        14.68     95%       12.68
Civic Center           98%         14.65      95%        13.82     90%       13.66

(1)   Commercial average annual rental rate is per square foot.
(2)   Investment properties were sold during 1999.

</TABLE>

The General Partner  attributed the increase in the net realizable  value of the
collateral  properties  securing the Master Loan, with the exception of Richmond
Plaza,  to an increase in occupancy  and/or average rental rates as presented in
the table above.  The increase in occupancy at the properties is attributable to
approximately $9,721,000 of combined capital improvements that have been made to
most of the properties over the past few years.  These  improvements were funded
from the various properties'  operations and cash flows as the advances from the
Partnership  to CCEP/2 for operating  needs total  approximately  $1,150,000 for
1998, 1997 and 1996. The underlying  asset values of the properties  support the
net reduction in the allowance for impairment loss of approximately  $13,586,000
recorded  during  1998.  During the  fourth  quarter  of 1998,  the  Partnership
recorded a $14,000,000  increase in the allowance for impairment loss due to the
continuing  evaluation of the collateral  properties  resulting from  appraisals
received  during  February  1999 on several  of the  collateral  properties  and
additional information received concerning Richmond Plaza.

Liquidity and Capital Resources

At  December  31,  1999,  the  Registrant  had  cash  and  cash  equivalents  of
approximately  $6,846,000 as compared to  approximately  $10,969,000 at December
31, 1998. The net decrease of  approximately  $4,123,000 is due to approximately
$37,995,000 of cash used in financing activities,  which was partially offset by
approximately   $33,111,000  of  cash  provided  by  investing   activities  and
approximately  $761,000 of cash provided by operating activities.  Cash provided
by investing activities consisted of principal receipts on the Master Loan. Cash
used in financing activities consisted of distributions to partners.

At  December  31,  1998,  the  Registrant  had  cash  and  cash  equivalents  of
approximately  $10,969,000 as compared to approximately  $12,417,000 at December
31, 1997. The net decrease of  approximately  $1,448,000 is due to approximately
$65,000 of cash used in investing  activities  and  approximately  $2,985,000 of
cash used in financing  activities  which was partially  offset by approximately
$1,602,000  of cash  provided by  operating  activities.  Cash used in investing
activities  consisted of advances on the Master Loan which was partially  offset
by  principal  receipts on the Master Loan.  Cash used in  financing  activities
consisted of distributions to the partners.

The sufficiency of existing  liquid assets to meet future  liquidity and capital
expenditure   requirements   is  directly   related  to  the  level  of  capital
expenditures required to meet the ongoing operating needs of the Partnership and
to comply with Federal, state, local, legal, and regulatory  requirements.  Such
assets are  currently  thought to be sufficient  for any near-term  needs of the
Partnership. See "CCEP/2 Property Operations" for discussion on CCEP/2's ability
to provide future cash flow as Master Loan debt service.

The Partnership made distributions totaling approximately  $37,995,000 (of which
$37,939,000  was to the  limited  partners or  approximately  $41.73 per limited
partnership  unit) during the twelve months ended December 31, 1999.  During the
twelve months ended December 31, 1998, the  Partnership  made  distributions  of
approximately  $2,985,000  (approximately  $3.28 per limited  partnership unit).
During the twelve  months  ended  December  31,  1997,  the  Partnership  made a
distribution of approximately $9,992,000 (of which $9,982,000 was to the limited
partners  approximately  $10.98  per  limited  partnership  unit).  Future  cash
distributions will depend on CCEP/2's ability to make payments on account of the
Master  Loan  and  the   availability  of  cash  reserves.   The   Partnership's
distribution  policy  is  reviewed  on a  semi-annual  basis.  There  can  be no
assurance,  however,  that the  Partnership  will  have  sufficient  funds  from
operations  to permit any  additional  distributions  to its partners in 2000 or
subsequent periods.

The  Partnership is required by the  Partnership  Agreement to maintain  working
capital reserves for  contingencies of not less than 5% of Net Invested Capital,
as defined  by the  Partnership  Agreement.  Reserves,  including  cash and cash
equivalents,  totaling  approximately  $6,846,000  were greater than the reserve
requirement of approximately $5,391,000 at December 31, 1999.

CCEP/2 Property Operations

CCEP/2 had net income of  approximately  $1,797,000  for the year ended December
31, 1999, versus a net loss of $22,613,000 for the year ended December 31, 1998.
The increase in net income was primarily  due to a gain on sale of  discontinued
operations  and to, a lesser  extent,  a  casualty  gain at  Village  Brooke  as
discussed  below.  Excluding  the  impact  of  discontinued  operations  and the
casualty  gain  at  Village  Brooke,  CCEP/2  had a net  loss  of  approximately
$24,401,000  for the year ended  December 31, 1999 on revenues of  approximately
$6,207,000,  versus a net loss of  approximately  $23,869,000 for the year ended
December 31, 1998 on revenues of $6,985,000.  CCEP/2 recognizes interest expense
on the New  Master  Loan  Agreement  obligation  according  to the  note  terms,
although  payments to the  Partnership are required only to the extent of Excess
Cash Flow, as defined therein.  During 1999, CCEP/2's consolidated  statement of
operations  includes total interest  expense  attributable to the Master Loan of
approximately $24,962,000. Approximately $998,000 of required cash flow payments
were made to CCIP/2  during 1999 and  classified as interest  income.  CCEP/2 is
expected to continue to generate  operating  losses as a result of such interest
accruals and noncash charges for depreciation.

During the year ended December 31, 1999, the Partnership received  approximately
$33,111,000 as principal payments on the Master Loan consisting of required cash
flow payments.  These funds are required to be  transferred  to the  Partnership
under the terms of the Master Loan.

On  September  10,  1999,  the five  commercial  properties  located in Michigan
(Lahser One,  Lahser Two,  Crescent  Centre,  Central  Park Place,  Central Park
Plaza) were sold to an unaffiliated  third party for $26,125,000.  After closing
expenses  of  approximately   $1,727,000  the  net  proceeds   received  by  the
Partnership were approximately $24,398,000.  The sale of the properties resulted
in a gain on sale of investment property of approximately $10,392,000.

On September 22, 1999, Town Center Plaza, located in Santa Ana, California,  was
sold to an unaffiliated  third party for $11,650,000.  After closing expenses of
approximately  $1,004,000,  the net proceeds  received by the  Partnership  were
approximately  $10,646,000.  The Partnership  used some of the proceeds from the
sale  of  the  property  to  pay  off  the  debt  encumbering  the  property  of
approximately $2,316,000. The sale of the property resulted in a gain on sale of
investment   property  of   approximately   $4,862,000   and  a  loss  on  early
extinguishment of debt of approximately $7,000.

On December 23, 1999, Richmond Plaza, located in Richmond, Virginia, was sold to
an unaffiliated third party for $14,900,000. Closing expenses were approximately
$784,000.  The debt  encumbering the property of  approximately  $14,500,000 was
assumed by the buyer.  The sale of the  property  resulted  in a gain on sale of
investment   property  of   approximately   $5,499,000   and  a  loss  on  early
extinguishment of debt of approximately $24,000.

In April 1999,  one of CCEP/2's  residential  properties,  Village  Brooke,  was
completely  destroyed by a tornado.  It is currently estimated that the property
sustained  approximately  $16,000,000  in  damages.  As of  December  31,  1999,
$10,000,000 in insurance  proceeds have been received with additional  insurance
proceeds expected in the future.  All of the property's fixed assets and related
accumulated  depreciation  were written off as a result of this  casualty.  Lost
rents of approximately $750,000 and expenses of approximately $845,000 have been
recorded  as  of  December  31,  1999  which  resulted  in a  casualty  gain  of
approximately  $5,473,000 at December 31, 1999. The General Partner is currently
negotiating  with  the  taxing   authorities  to  have  the  property  taxed  as
undeveloped land. The General Partner is currently  evaluating and surveying the
land to determine possible new construction of the property.

In April  1999,  an  electrical  fire  occurred  at Town  Center.  The  property
sustained  approximately  $181,000  in damages and  realized a casualty  loss of
approximately  $33,000.  This property was  subsequently  sold in September 1999
(see above) and the purchaser of the property  assumed the remaining  obligation
related to the fire.

Year 2000 Compliance

General Description

The Year 2000 issue is the result of computer  programs  being written using two
digits rather than four digits to define the applicable year. The Partnership is
dependent  upon the  General  Partner  and its  affiliates  for  management  and
administrative services ("Managing Agent"). Any of the Managing Agent's computer
programs or hardware that had  date-sensitive  software or embedded  chips might
have  recognized  a date using "00" as the year 1900  rather than the year 2000.
This  could  have  resulted  in a  system  failure  or  miscalculations  causing
disruptions of operations,  including, among other things, a temporary inability
to process  transactions,  send invoices,  or engage in similar normal  business
activities.

Computer Hardware, Software and Operating Equipment

In 1999,  the Managing  Agent  completed  all phases of its Year 2000 program by
completing  the  replacement  and repair of any  hardware or software  system or
operating  equipment that was not yet Year 2000 compliant.  The Managing Agent's
hardware  and software  systems and its  operating  equipment  are now Year 2000
compliant.  No  material  failure or  erroneous  results  have  occurred  in the
Managing Agent's computer  applications  related to the failure to reference the
Year 2000 to date.

Third Parties

To  date,  the  Managing  Agent  is not  aware of any  significant  supplier  or
subcontractor  (external agent) or financial institution of the Partnership that
has a Year 2000 issue that  would  have a material  impact on the  Partnership's
results of operations,  liquidity or capital  resources.  However,  the Managing
Agent  has no means of  ensuring  or  determining  the Year 2000  compliance  of
external  agents.  At this time, the Managing Agent does not believe that a Year
2000 issue of any  non-compliant  external agent will have a material  impact on
the Partnership's financial position or results of operations.

Costs

The total cost of the Managing Agent's Year 2000 project was approximately  $3.2
million and was funded from operating cash flows.

Risks Associated with the Year 2000

The Managing  Agent  completed all necessary  phases of its Year 2000 program in
1999,  and did not  experience  system or  equipment  malfunctions  related to a
failure to reference the Year 2000. The Managing  Agent or Partnership  have not
been  materially  adversely  effected by  disruptions  in the economy  generally
resulting from the Year 2000 issue.

At this  time,  the  Managing  Agent  does not  believe  that the  Partnership's
businesses,  results of  operations  or financial  condition  will be materially
adversely effected by the Year 2000 issue.

Contingency Plans Associated with the Year 2000

The  Managing  Agent has not had to implement  contingency  plans such as manual
workarounds or selecting new relationships for its banking or elevator operation
activities in order to avoid the Year 2000 issue.

Item 7a.    Market Risk Factors

The  Partnership is exposed to market risks  associated  with its Master Loan to
Affiliate  ("Loan").  Receipts  (interest income) on the Loan are based upon the
operations  and  cash  flow  of  the  underlying   investment   properties  that
collateralize the Loan. Both the income and expenses of operating the investment
properties are subject to factors outside of the Partnership's  control, such as
an oversupply of similar properties  resulting from  overbuilding,  increases in
unemployment or population  shifts,  reduced  availability of permanent mortgage
financing, changes in zoning laws, or changes in the patterns or needs of users.
The  investment  properties  are also  susceptible to the impact of economic and
other  conditions  outside of the  control of the  Partnership  as well as being
affected  by current  trends in the market  area  which  they  operate.  In this
regard, the General Partner of the Partnership  closely monitors the performance
of the properties collateralizing the loans.

Based upon the fact that the loan is  considered  impaired  under  Statement  of
Financial  Accounting  Standards No. 114, "Accounting by Creditor for Impairment
of a Loan",  interest rate fluctuations do not affect the recognition of income,
as income is only recognized to the extent of cash flow. Therefore,  market risk
factors do not affect the  Partnership's  results of operations as it relates to
the Loan. See "Item 8 - Financial  Statements and  Supplementary  Data - Note C"
for further information.

Item 8.     Financial Statements and Supplementary Data

CONSOLIDATED CAPTIAL INSTITIONAL PROPERTIES/2, L.P.

LIST OF FINANCIAL STATEMENTS

      Report of Ernst & Young LLP, Independent Auditors

      Balance Sheets as of December 31, 1999 and 1998

      Statements of Operations for the Years ended December 31, 1999, 1998 and
      1997

      Statements of Changes in Partners'  (Deficit)  Capital for the Years ended
      December 31, 1999, 1998 and 1997

      Statements of Cash Flows for the Years ended December 31, 1999, 1998 and
      1997

      Notes to Financial Statements


<PAGE>


                    Report of Ernst & Young LLP, Independent Auditors

The Partners

Consolidated Capital Institutional Properties/2


We  have  audited  the  accompanying   balance  sheet  of  Consolidated  Capital
Institutional  Properties/2  as of December  31, 1999 and 1998,  and the related
statements of operations,  changes in partners' (deficit) capital and cash flows
for each of the  three  years in the  period  ended  December  31,  1999.  These
financial statements are the responsibility of the Partnership's management. Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made  by the  Partnership's  management,  as  well  as  evaluating  the  overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial   position  of  Consolidated   Capital
Institutional Properties/2 at December 31, 1999 and 1998, and the results of its
operations  and its cash flows for each of the three  years in the period  ended
December 31, 1999, in conformity with accounting  principles  generally accepted
in the United States.

                                                           /s/ ERNST & YOUNG LLP



Greenville, South Carolina
March 8, 2000

                     CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/2

                                 BALANCE SHEETS

                             (in thousands, except unit data)



<TABLE>
<CAPTION>
                                                                  December 31,
                                                                1999          1998
Assets
<S>                                                        <C>            <C>

   Cash and cash equivalents                               $  6,846       $ 10,969
   Accounts receivable                                           92             --
   Other assets                                                  11             12

   Investment in Master Loan to affiliate                    47,503         80,614
      Less: Allowance for impairment loss                   (29,129)       (29,129)
                                                             18,374         51,485
                                                           $ 25,323       $ 62,466
Liabilities and Partners' (Deficit) Capital
Liabilities

   Other liabilities                                       $     58       $     14
   Distributions payable                                        141            141
                                                                199            155
Partners' (Deficit) Capital

   General partner                                             (410)          (362)
   Limited partners (909,123.60 outstanding at
      December 31, 1999 and 909,134 outstanding at 1998)     25,534         62,673
                                                             25,124         62,311
                                                           $ 25,323       $ 62,466

                      See Accompanying Notes to Financial Statements
</TABLE>


                 CONSOLIDATED CAPTIAL INSTITUTIONAL PROPERTIES/2

                            STATEMENTS OF OPERATIONS

                         (in thousands, except unit data)

<TABLE>
<CAPTION>

                                                            Years Ended December 31,
<S>                                                        <C>          <C>        <C>
                                                           1999         1998       1997
Revenues:
   Interest income on net investment
     in Master Loan to affiliate                        $   998       $ 1,200     $   870
   Reduction of provision for impairment loss                --        13,586       5,328
   Interest income on investments                           330           581         557
      Total revenues                                      1,328        15,367       6,755

Expenses:
   General and administrative                               520           820         480
      Total expenses                                        520           820         480

Net income (Note I)                                     $   808       $14,547     $ 6,275


Net income allocated to general partner (1%)            $     8       $   145     $    63

Net income allocated to limited partners (99%)              800        14,402       6,212

                                                        $   808       $14,547     $ 6,275

Net income per Limited Partnership Unit                 $   .88       $ 15.84     $  6.83

Distribution per Limited Partnership Unit               $ 41.73       $  3.28     $ 10.98

                      See Accompanying Notes to Financial Statements

</TABLE>


                     CONSOLIDATED CAPTIAL INSTITUTIONAL PROPERTIES/2

                   STATEMENTS OF CHANGES IN PARTNERS' (DEFICIT) CAPITAL
                             (in thousands, except unit data)

<TABLE>
<CAPTION>

                                                                              Total
                                         Limited                             Partners
                                       Partnership    General     Limited    Capital
                                          Units       Partners   Partners   (Deficit)
<S>                                      <C>          <C>        <C>        <C>

Original capital contributions           912,182       $    1    $228,046   $228,047

Partners' (deficit) capital
   at December 31, 1996                  909,138       $ (560)   $ 55,026   $ 54,466

Distributions to partners                                 (10)     (9,982)    (9,992)

Net income for the year ended
   December 31, 1997                                       63       6,212      6,275

Partners' (deficit) capital at
   December 31, 1997                     909,134         (507)     51,256     50,749

Distributions to partners                                  --      (2,985)    (2,985)

Net income for the year ended
   December 31, 1998                                      145      14,402     14,547

Partners' (deficit) capital at
   December 31, 1998                     909,134         (362)     62,673     62,311

Distributions to partners                                 (56)    (37,939)   (37,995)

Net income for the year ended
   December 31, 1999                                        8         800        808

Partners' (deficit) capital

   at December 31, 1999                  909,124     $   (410)   $ 25,534   $ 25,124

                      See Accompanying Notes to Financial Statements
</TABLE>

                     CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/2

                            STATEMENTS OF CASH FLOWS

                                      (in thousands)

<TABLE>
<CAPTION>

                                                         Year Ended December 31,
                                                       1999        1998        1997
Cash flows from operating activities:
<S>                                                  <C>         <C>         <C>

  Net income                                          $ 808      $ 14,547     $ 6,275
  Adjustments to reconcile net income to
   net cash provided by operating activities:
   Reduction of provision for impairment loss              --     (13,586)     (5,328)
   Change in accounts:
      Interest receivable on Master Loan                  (92)        634        (634)
      Other assets                                          1           9          13
      Accounts payable                                     --          (6)          6
      Other liabilities                                    44           4         (19)

          Net cash provided by operating
           activities                                     761       1,602         313

Cash flows from investing activities:

  Advances on Master Loan                                  --        (220)       (150)
  Principal receipts on Master Loan                    33,111         155       3,768

          Net cash provided by (used in)
            investing activities                       33,111         (65)      3,618

Cash flows used in financing activities:

  Distributions to partners                           (37,995)     (2,985)     (9,992)

Net decrease in cash and cash equivalents              (4,123)     (1,448)     (6,061)

Cash and cash equivalents at beginning
  of period                                            10,969      12,417      18,478

Cash and cash equivalents at end of period           $ 6,846     $ 10,969    $ 12,417

                      See Accompanying Notes to Financial Statements
</TABLE>

                     CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/2

                          NOTES TO FINANCIAL STATEMENTS

Note A - Organization and Summary of Significant Accounting Policies

Organization: Consolidated Capital Institutional Properties/2 (the "Partnership"
or  "Registrant"),  a California  Limited  Partnership,  was formed on April 12,
1983, to lend funds through non-recourse notes with participation interests (the
"Master Loan").  The loans were made to, and the real properties that secure the
Master  Loan were  purchased  and  owned by,  Equity  Partners/Two  ("EP/2"),  a
California  general  partnership  in which  certain of the partners  were former
shareholders and former management of Consolidated  Capital Equities Corporation
("CCEC"),  the former  corporate  general  partner of the  Partnership.  Through
December 31, 1999, the Partnership had advanced approximately $183,470,000 under
the Master Loan.

During 1989, EP/2 defaulted on certain interest payments that were due under the
Master  Loan.  Before the  Partnership  could  exercise  its  remedies  for such
defaults,  EP/2 filed for bankruptcy  protection  under Chapter 11 of the United
States Bankruptcy Code ("Chapter 11"). On October 18, 1990, the bankruptcy court
approved EP/2's  consensual  plan of  reorganization  (the "Plan").  In November
1990, EP/2 and the Partnership  consummated a closing under the Plan pursuant to
which,  among other  things,  the  Partnership  and EP/2 executed an amended and
restated loan  agreement (the "New Master Loan  Agreement").  EP/2 was converted
from a  California  general  partnership  to a California  limited  partnership,
Consolidated  Capital Equity Partners/Two,  L.P. ("CCEP/2"),  and CCEP/2 renewed
the deeds of trust and mortgages on all the properties collaterally securing the
New Master Loan Agreement.  ConCap Holdings,  Inc. ("CHI"),  a Texas corporation
and wholly-owned subsidiary of CEI, is the sole general partner of CCEP/2 and an
affiliate  of the  Partnership.  The general  partners  of EP/2  became  limited
partners in CCEP/2. CHI has full discretion with respect to conducting  CCEP/2's
business,  including  managing CCEP/2's  properties and initiating and approving
capital  expenditures and asset dispositions and refinancings.  See "Note C" for
further discussion of EP/2's bankruptcy settlement.

Upon the Partnership's formation in 1983, CCEC, a Colorado corporation,  was the
corporate general partner. In December 1988, CCEC filed for reorganization under
Chapter 11. In 1990, as part of CCEC's  reorganization  plan,  ConCap  Equities,
Inc., a Delaware  corporation  (the "General  Partner" or "CEI") acquired CCEC's
general partner  interests in the Partnership and in 15 other affiliated  public
limited  partnerships  and replaced CCEC as managing  general  partner in all 16
partnerships.  The General  Partner is a subsidiary of Apartment  Investment and
Management Company ("AIMCO").  See "Note B - Transfer of Control." The directors
and officers of the General  Partner also serve as executive  officers of AIMCO.
The  Partnership  Agreement  provides  that the  Partnership  is to terminate on
December  31,  2013  unless  terminated  prior  to such  date.  The  Partnership
commenced  operations  on July 22,  1983.  The  Partnership  was  formed for the
benefit of its Limited Partners to lend funds to Equity Partners/Two ("EP/2").

The Partnership is the holder of a note receivable  which is  collateralized  by
four apartment properties located throughout the United States.

Use of Estimates:  The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Cash and Cash  Equivalents:  Includes cash on hand and in banks and money market
accounts.  At certain  times,  the amount of cash deposited at a bank may exceed
the limit on insured deposits.

Investment in Master Loan:  The  Partnership  has adopted  Financial  Accounting
Standards Board Statement No. 114,  "Accounting by Creditors for Impairment of a
Loan"("Statement  114").  Under the  standard,  the  allowance for credit losses
related  to  loans  that  are  identified  for  evaluation  in  accordance  with
"Statement  114" is based on  discounted  cash flows  using the  loan's  initial
effective  interest  rate  or the  fair  value  of the  collateral  for  certain
collateral dependent loans.

Investments:  The General Partner  determines the appropriate  classification of
debt securities at the time of purchase and reevaluates  such  designation as of
each balance sheet date.  Presently,  all of the  Partnership's  investments are
classified as available-for-sale.  Available-for-sale  securities are carried at
fair value,  with the  unrealized  gains and losses,  net of tax,  reported in a
separate component of partner's  capital.  The amortized cost of debt securities
in this  category is adjusted  for  amortization  of premiums  and  accretion of
discounts to  maturity.  Such  amortization  is included in  investment  income.
Realized   gains   and   losses   and   declines   in   value   judged   to   be
other-than-temporary on available-for-sale securities are included in investment
income.  The cost of  securities  sold is based on the  specific  identification
method.  Interest and dividends on securities  classified as  available-for-sale
are included in other income.

Investments,  stated at cost of  approximately  $11,000,  consist  of  Southmark
Corporation   Redeemable  Series  A  Preferred  Stock.   These  investments  are
classified as available for sale and are included in other assets.

Income Taxes: No provision has been made in the financial statements for Federal
income  taxes  because,  under  current  law, no Federal  income  taxes are paid
directly  by the  Partnership.  The  Unit  holders  are  responsible  for  their
respective  shares of Partnership  net income or loss. The  Partnership  reports
certain transactions differently for tax than for financial statement purposes.

Partners' (Deficit) Capital:  The Partnership  Agreement provides for net income
and net losses for both financial and tax reporting purposes to be allocated 99%
to the Limited Partners and 1% to the General Partner.  "Distributable Cash from
Operations",  as defined in the Partnership Agreement, is to be allocated 99% to
the Limited  Partners and 1% to the General  Partner.  Distributions  of surplus
funds are to be allocated 100% to the Limited Partners.

Net Income Per Limited Partnership Unit: Net income per Limited Partnership Unit
("Unit") is computed by dividing net income allocated to the Limited Partners by
the number of Units outstanding. Per Unit information has been computed based on
909,133.60 Units outstanding in 1999, 1998 and 1997.

Fair Value of Financial Instruments: Statement of Financial Accounting Standards
("SFAS") No. 107,  "Disclosures about Fair Value of Financial  Instruments",  as
amended by SFAS No. 119, "Disclosures about Derivative Financial Instruments and
Fair  Value  of  Financial  Instruments",  requires  disclosure  of  fair  value
information  about  financial  instruments,  whether  or not  recognized  in the
balance sheet, for which it is practicable to estimate fair value. Fair value is
defined in the SFAS as the amount at which the instruments could be exchanged in
a  current  transaction  between  willing  parties,  other  than in a forced  or
liquidation  sale.  The  Partnership  believes  that the carrying  amount of its
financial  instruments  approximates  their  fair  value due to the  short  term
maturity of these  instruments.  The carrying  amount of the  Partnership's  net
investment  in the Master Loan  approximates  fair value due to the fact that it
has been valued based on the fair value of the underlying collateral.

Allowance  for  Impairment  Loss:  Allowances to reduce the carrying cost of the
Master Loan are  provided  when it is probable  that  reasonably  estimable  net
realizable  values are less than the recorded  carrying cost of such investment.
Gains or losses  that result from the  ongoing  periodic  evaluation  of the net
realizable value of the Master Loan are credited or charged, as appropriate,  to
operations in the period in which they are identified.  If a collateral party is
sold,  CCEP/2  remains  liable for any  outstanding  debt under the Master  Loan
Agreement,  however,  the  value of the net  investment  in  Master  Loan on the
Partnership's books would be written down to the appropriate level.

Segment   Reporting:   Statement  of  Financial   Standards  ("SFAS")  No.  131,
"Disclosure about Segments of an Enterprise and Related Information" ("Statement
131") established  standards for the way that public business enterprises report
information about operating segments in annual financial statements and requires
that those enterprises  report selected  information about operating segments in
interim financial reports. It also establishes standards for related disclosures
about products and services,  geographic areas, and major customers.  As defined
in SFAS No. 131, the Partnership has only one reportable segment.  Moreover, due
to the very nature of the Partnership's operations, the General Partner believes
that segment-based disclosures will not result in a more meaningful presentation
than the financial statements as presently presented.

Note B - Transfer of Control

Pursuant  to a series  of  transactions  which  closed  on  October  1, 1998 and
February 26, 1999,  Insignia Financial Group, Inc. and Insignia Properties Trust
merged into AIMCO, a publicly traded real estate  investment  trust,  with AIMCO
being the surviving  corporation  (the "Insignia  Merger").  As a result,  AIMCO
acquired 100% ownership  interest in the General  Partner.  The General  Partner
does not believe that this transaction has had or will have a material effect on
the affairs and operations of the Partnership.

Note C - Net Investment in Master Loan

At December 31, 1999,  the recorded  investment in the Master Loan is considered
to be impaired under "Statement of Financial Accounting Standards No. 114 ("SFAS
114")  "Accounting  by Creditors  for  Impairment  of a Loan".  The  Partnership
measures the  impairment of the loan based upon the fair value of the collateral
due to the fact that repayment of the loan is expected to be provided  solely by
the collateral.  For the years ended December 31, 1998 and 1997, the Partnership
recorded approximately $13,586,000 and $5,328,000 respectively,  in income based
upon an  increase  in the  fair  value of the  collateral.  No such  income  was
recorded in 1999 as the recorded value of the Master Loan  approximated the fair
value of the collateral at December 31, 1999.

The  principal  balance  of the  Master  Loan  due to  the  Partnership  totaled
approximately  $47,503,000  and  $80,614,000  at  December  31,  1999 and  1998,
respectively.  Interest  due to the  Partnership  pursuant  to the  terms of the
Master Loan  Agreement,  but not  recognized in the income  statements,  totaled
approximately  $23,964,000,  $22,609,000  and  $21,070,000  for the years  ended
December 31, 1999, 1998 and 1997, respectively.

At December 31, 1999 and 1998, such cumulative  unrecognized  interest  totaling
approximately  $200,943,000  and $176,979,000 was not included in the balance of
the  investment  in  Master  Loan as it is not  expected  to be  collected.  The
allowance for possible losses totaled approximately  $29,129,000 at December 31,
1999 and 1998.

No advances  were made to CCEP/2  during the year ended  December 31, 1999 as an
advance on the Master Loan.  During the year ended December 31, 1998, an advance
of  $220,000  was made to CCEP/2 as an advance on the  Master  Loan.  CCEP/2 has
approximately  $15,557,000 in liens on the  collateral  that are superior to the
Master Loan.

The investment in Master Loan consists of the following:

                                                As of December 31,
                                                1999           1998
                                                  (in thousands)
  Master Loan funds advanced, at

    beginning of year                        $ 80,614        $ 80,549
  Advances on Master Loan                          --             220
  Principal receipts on Master Loan           (33,111)           (155)
  Master Loan funds advanced, at
    end of year                              $ 47,503        $ 80,614

The allowance for impairment  loss on Master Loan to affiliates  consists of the
following:

<TABLE>
<CAPTION>

                                                        As of December 31,
                                                   1999         1998        1997
                                                          (in thousands)
<S>                                             <C>         <C>          <C>

Allowance for impairment loss on Master
   Loan to affiliates, beginning of year       $ 29,129     $ 42,715     $ 48,043
 Reduction of provision for impairment loss          --      (13,586)      (5,328)

 Allowance for impairment loss on Master
   Loan to affiliates, end of year             $ 29,129     $ 29,129     $ 42,715

</TABLE>

The  fair  value of the  collateral  properties  was  determined  using  the net
operating  income of the  collateral  properties  capitalized  at a rate  deemed
reasonable  for the type of property  adjusted for market  conditions,  physical
condition of the property and other factors,  or by obtaining an appraisal by an
independent  third  party.  This  methodology  has not changed from that used in
prior  calculations  performed by the General  Partner in  determining  the fair
value of the collateral properties. The approximate $13,586,000 net reduction in
the  provision for  impairment  loss that was  recognized  during the year ended
December 31, 1998 is  attributed to an increase in the net  realizable  value of
the  collateral  properties.  The General  Partner  evaluates the net realizable
value on a semi-annual basis. The General Partner has seen a consistent increase
in the net realizable value of the collateral properties, taken as a whole, over
the past two years (1998 and 1997). The increase is deemed to be attributable to
major capital  improvement  projects and the strong effort to complete  deferred
maintenance  items that have been ongoing over the past few years at the various
properties.  This has  enabled  the  properties  to  increase  their  respective
occupancy  levels or in some cases to maintain the  properties'  high  occupancy
levels.  The  vast  majority  of this  work was  funded  by cash  flow  from the
collateral properties themselves as the total amount borrowed on the master loan
or from other sources in the past few years for this purpose totals  $1,150,000.
Based upon the  consistent  increase in net  realizable  value of the collateral
properties,  the General  Partner  determined  the  increase to be  permanent in
nature and  accordingly  reduced the allowance for impairment loss on the master
loan during the year ended December 31, 1998.

Approximately $998,000, $1,200,000 and $870,000 for the years ended December 31,
1999, 1998, and 1997, respectively was recorded as interest income on investment
in the Master  Loan to an  affiliate  based upon cash  generated  as a result of
improved  operations of the properties  which secure the loan. A cash payment of
approximately  $575,000 was received from Consolidated Capital Equity Partners/2
L.P.   ("CCEP/2")  during  the  second  quarter  of  1999.  A  cash  payment  of
approximately  $423,000  was  received  during the  fourth  quarter of 1999 from
CCEP/2. A cash payment of  approximately  $634,000 was received during the first
quarter  of 1998 for  interest  income  recognized  in 1997.  A cash  payment of
approximately  $564,000 for the interest income recorded in the first quarter of
1998 was  received  during  the  second  quarter  of  1998.  A cash  payment  of
approximately  $505,000 was  received  from CCEP/2  during the third  quarter of
1998. A cash payment of  approximately  $131,000 was received from CCEP/2 during
the fourth quarter for interest income recognized in the fourth quarter of 1998.
In  accordance  with the terms of the  Master  Loan  Agreement  the  Partnership
received  approximately  $32,034,000  of net proceeds  from the sale of seven of
CCEP/2's properties during 1999.

Terms of the New Master Loan Agreement

Under the terms of the New Master Loan  Agreement,  interest  accrues at 10% and
payments are due  quarterly  in an amount  equal to Excess Cash Flow,  generally
defined in the New Master Loan Agreement as net cash flow after third party debt
service and capital  improvements.  If such Excess Cash Flow  payments  are less
than the  current  accrued  interest  during the  quarterly  period,  the unpaid
interest is added to principal, compounded annually, and is payable at maturity.
If such Excess Cash Flow payments are greater than the current accrued interest,
the  excess  amount is  applied to the  principal  balance of the loan.  Any net
proceeds from the sale or refinancing of any of CCEP/2's  properties are paid to
the Partnership under the terms of the New Master Loan Agreement. The New Master
Loan Agreement matures in November 2000. The Partnership is currently evaluating
its options as to the maturity of the Master Loan in November  2000. The options
include  foreclosing on the  properties  that  collateralize  the Master Loan or
extending the terms of the loan.

Effective  January 1, 1993,  the  Partnership  and CCEP/2 amended the New Master
Loan  Agreement  to  stipulate  that Excess  Cash Flow would be computed  net of
capital  improvements.  Such  expenditures were formerly funded from advances on
the Master Loan from the Partnership to CCEP/2. This amendment and change in the
definition  of Excess Cash Flow will have the effect of  reducing  income on the
investment in Master Loan by the amount of CCEP/2's capital expenditures,  since
such amounts were previously excluded from Excess Cash Flow.

EP/2's   Bankruptcy   Settlement:   In   November   1990,   pursuant  to  EP/2's
reorganization  plan described in "Note A", the Partnership and EP/2 consummated
a closing  pursuant to which:  (1) the  Partnership  and EP/2  executed  the New
Master Loan Agreement more fully described  below;  (2) CCEP/2 renewed the deeds
of trust on all the  collateral  securing the Master Loan;  (3) the  Partnership
received cash of approximately $2,500,000, including $1,800,000 from the general
partners of EP/2 related to their promissory notes; (4) the Partnership accepted
assignment  of certain  partnership  interests in affiliated  partnerships  (the
"Affiliated  Partnership  Interests"),  which were valued by  management  of the
Partnership at approximately  $2,500,000,  as additional collateral securing the
Master  Loan;  and (5) all claims  between the  Partnership  and EP/2's  general
partners were released.

EP/2 was the holder of a note  receivable  secured by North Park Plaza which had
not been  performing  according to the note terms since 1989.  In the process of
negotiating the final bankruptcy  settlement  discussed above, EP/2 assigned its
interest in the note receivable to the Partnership.  The Partnership  foreclosed
upon and acquired North Park Plaza in July 1990,  CCEP/2 is still  obligated for
$6,600,000  under  the  Master  Loan   attributable  to  North  Park  Plaza  not
extinguished in the foreclosure proceeding.

Note D - Transaction with Affiliated Parties

The Partnership has no employees and is dependent on the General Partner and its
affiliates for the management and administration of all Partnership  activities.
The Partnership  Agreement (the  "Agreement")  provides for reimbursement to the
General  Partner and its affiliates  for costs  incurred in connection  with the
administration of Partnership  activities.  The following  payments were made to
the General  Partner and  affiliates  during the years ended  December 31, 1999,
1998, and 1997:

                                                For the years ended December 31,
                                                   1999        1998        1997
                                                         (in thousands)
Reimbursements for services of affiliates
  (included in general and administrative
     expenses)                                    $ 217        $ 303      $ 278

An  affiliate  of the General  Partner  received  reimbursement  of  accountable
administrative  expenses  amounting  to  approximately  $217,000,  $303,000  and
$278,000 for the years ended December 31, 1999, 1998 and 1997, respectively.

Several tender offers were made by various parties,  including affiliates of the
General Partners,  during the years ended December 31, 1999, 1998 and 1997. As a
result of these tender offers, AIMCO and its affiliates currently own 370,955.70
units  of  limited   partnership   interest  in  the  Partnership   representing
approximately  40.80% of the outstanding units. It is possible that AIMCO or its
affiliates will make one or more additional offers to acquire additional limited
partnership  interests in the  Partnership  for cash or in exchange for units in
the  operating  partnership  of AIMCO.  Consequently,  AIMCO is in a position to
significantly  influence all voting  decisions  with respect to the  Registrant.
Under the Partnership Agreement, unitholders holding a majority of the Units are
entitled  to take action  with  respect to a variety of matters.  When voting on
matters,  AIMCO would in all  likelihood  vote the Units it acquired in a manner
favorable to the interest of the General  Partner  because of their  affiliation
with the General Partner.

Note E - Contingencies

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the   Partnership,   the  General  Partner  and  several  of  their   affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging  the  acquisition  by Insignia  Financial  Group,  Inc.
("Insignia")  and  entities  which  were,  at one time,  affiliates  of Insignia
("Insignia  Affiliates") of interests in certain general partner entities,  past
tender offers by Insignia  Affiliates to acquire limited  partnership units, the
management of partnerships  by Insignia  Affiliates and the Insignia Merger (see
"Note B - Transfer  of  Control").  The  plaintiffs  seek  monetary  damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998,  the General  Partner filed a motion seeking  dismissal of the action.  In
lieu  of  responding  to the  motion,  the  plaintiffs  have  filed  an  amended
complaint.  The General Partner filed  demurrers to the amended  complaint which
were heard  February  1999.  Pending  the ruling on such  demurrers,  settlement
negotiations  commenced.  On November 2, 1999, the parties  executed and filed a
Stipulation of Settlement settling claims,  subject to final court approval,  on
behalf of the Partnership and all limited  partners who own units as of November
3, 1999. Preliminary approval of the settlement was obtained on November 3, 1999
from the  Superior  Court of the State of  California,  County of San Mateo,  at
which time the Court set a final approval  hearing for December 10, 1999.  Prior
to the December 10, 1999 hearing the Court  received  various  objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the  alleged  lack of  authority  of class  plaintiffs'  counsel  to  enter  the
settlement.  On  December  14,  1999,  the General  Partner  and its  affiliates
terminated the proposed  settlement.  Certain  plaintiffs have filed a motion to
disqualify  some of the plaintiffs'  counsel in the action.  The General Partner
does not anticipate that costs associated with this case will be material to the
Partnership's overall operations.

The  Partnership is unaware of any other pending or outstanding  litigation that
is not of a routine nature arising in the ordinary course of business.

Note F - Commitment

The  Partnership is required by the  Partnership  Agreement to maintain  working
capital reserves for  contingencies of not less than 5% of Net Invested Capital,
as defined in the Partnership Agreement. In the event expenditures are made from
this  reserve,  operating  revenue  shall be allocated  to such  reserves to the
extent necessary to maintain the foregoing levels. Reserves,  including cash and
cash equivalents totaling approximately  $6,846,000,  were more than the reserve
requirement of approximately $5,391,000 at December 31, 1999.

Note G - Distribution

The following table sets forth the distributions made by the Partnership for the
years ended December 31, 1997, 1998 and 1999.

                                                Distributions
                                                           Per Limited
                                        Aggregate        Partnership Unit

       01/01/97 - 12/37/97           $ 9,992,000 (1)         $ 10.98

       01/01/98 - 12/31/98             2,985,000 (2)            3.28

       01/01/99 - 12/31/99            37,995,000 (3)           41.73

(1)   Consists of $992,000 from operations which was distributed to all partners
      and $9,000,000 from  refinancing  proceeds of the CCEP/2  properties which
      was distributed 100% to the limited  partners.  ($9,982,000 to the limited
      partners, $10.98 per limited partnership unit).

(2)  Distribution  was made from surplus funds which was distributed 100% to the
     limited partners. (approximately $3.28 per limited partnership unit).

(3)   Consists of $323,000 from surplus funds and $32,000,000 from sale proceeds
      of CCEP/2 commercial proceeds distributed 100% to the limited partners and
      $5,672,000 from operations distributed to all partners ($37,939,000 to the
      limited partners, $41.73 per limited partnership unit).

Note H - Abandonment of Units

In 1999, the number of limited  partnership units decreased by 10 due to limited
partners  abandoning  their units. In abandoning his or her Limited  Partnership
Units,  a limited  partner  relinquished  all right,  title and  interest in the
Partnership  as of  the  date  of  abandonment.  However,  during  the  year  of
abandonment,  the limited partner is allocated his or her share of the income or
loss for that  year.  The net  income  (loss) per  limited  partnership  unit is
calculated  based on the number of units  outstanding  at the  beginning  of the
year.

Note I - Partner Tax Information

The  following  is a  reconciliation  between  net  income  as  reported  in the
financial statements and federal taxable (loss) income allocated to the partners
in the Partnership's  information  return for the years ended December 31, 1999,
1998 and 1997 (in thousands, except per unit data):

<TABLE>
<CAPTION>

                                                    1999          1998        1997
<S>                                             <C>           <C>          <C>

Net income as reported                           $   808       $ 14,547    $  6,275
Add (deduct):
   Accrued expenses                                   44              4         (19)
   Interest income                                (1,129)        (1,200)       (870)
   Valuation allowances                               --        (13,586)     (5,328)
   Other                                              35             36          --

Federal taxable (loss) income                    $  (312)      $   (199)   $     58

Federal taxable (loss) income per
     limited partnership unit                    $  (.34)      $   (.22)   $    .06

</TABLE>

The tax basis of the  Partnership's  assets  and  liabilities  is  approximately
$78,891,000 greater than the assets and liabilities as reported in the financial
statements at December 31, 1999.

Item 9.     Changes in and  Disagreements  with  Accountants  on Accounting  and
            Financial Disclosure

            None.



<PAGE>



                      CONSOLIDATED CAPITAL EQUITY PARTNERS/TWO, L.P.

                                 AS OF DECEMBER 31, 1999


LIST OF CONSOLIDATED FINANCIAL STATEMENTS

      Report of Ernst & Young LLP, Independent Auditors

      Consolidated Balance Sheets as of December 31, 1999 and 1998

      Consolidated  Statements of Operations for the Years Ended  December 31,
      1999, 1998 and 1997

      Consolidated  Statements of Partners' Deficit for the Years Ended December
      31, 1999, 1998 and 1997

      Consolidated  Statements of Cash Flows for the Years Ended  December 31,
      1999, 1998 and 1997

      Notes to Consolidated Financial Statements

                    Report of Ernst & Young LLP, Independent Auditors

The Partners

Consolidated Capital Equity Partners/Two L.P.

We have audited the  accompanying  consolidated  balance sheets of  Consolidated
Capital  Equity  Partners/Two  L.P.  as of December  31, 1999 and 1998,  and the
related consolidated statements of operations,  changes in partners' deficit and
cash flows for each of the three years in the period  ended  December  31, 1999.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made  by the  Partnership's  management,  as  well  as  evaluating  the  overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the  consolidated  financial  position of  Consolidated
Capital  Equity  Partners/Two  L.P.  at  December  31,  1999 and  1998,  and the
consolidated  results of its operations and its cash flows for each of the three
years in the period ended  December  31, 1999,  in  conformity  with  accounting
principles generally accepted in the United States.

The accompanying  consolidated  financial statements have been prepared assuming
that the Partnership will continue as a going concern. As discussed in Note A to
the consolidated  financial  statements,  the Partnership has incurred operating
losses,  suffers from inadequate  liquidity,  has an accumulated  deficit and is
unable to repay the Master Loan balance which matures in 2000.  These conditions
raise substantial  doubt about the Partnership's  ability to continue as a going
concern.  Management's  plans in regard to these  matters are also  described in
Note A. The consolidated  financial statements do not include any adjustments to
reflect the possible future effects on the  recoverability and classification of
assets or the amounts and  classification  of liability that may result from the
outcome of this uncertainty.

As discussed in Note K to the financial statements,  the Partnership changed its
method of  accounting  to  capitalize  the cost of exterior  painting  and major
landscaping effective January 1, 1999.

                                                           /s/ ERNST & YOUNG LLP



Greenville, South Carolina
March 8, 2000


                      CONSOLIDATED CAPITAL EQUITY PARTNERS/TWO, L.P.

                           CONSOLIDATED BALANCE SHEETS

                                      (in thousands)
<TABLE>
<CAPTION>

                                                                  December 31,
                                                               1999          1998
Assets
<S>                                                          <C>            <C>

  Cash and cash equivalents                                   $ 3,747        $ 2,199
  Restricted cash                                               7,750             --
  Receivables and deposits (net of allowance of $260)             853          2,142
  Restricted escrows                                              139          1,699
  Other assets                                                    260          2,413
  Investment properties: (Notes F and H)
      Land                                                      2,731         10,498
      Buildings and related personal property                  17,228         91,462
                                                               19,959        101,960
      Less accumulated depreciation                           (11,317)       (64,476)
                                                                8,642         37,484

                                                             $ 21,391       $ 45,937
Liabilities and Partners' Deficit
Liabilities

  Accounts payable                                            $ 323         $    194
  Tenant security deposit liabilities                             194            581
  Accrued property taxes                                          546            745
  Other liabilities                                               812            488
  Mortgage notes (Note F)                                      15,557         32,619
  Master loan and interest payable (Note E)                   247,753        256,901

                                                              265,185        291,528
Partners' Deficit

  General Partner                                               (2,424)       (2,442)
  Limited Partners                                           (241,370)      (243,149)
                                                             (243,794)      (245,591)

                                                             $ 21,391       $ 45,937

               See Accompanying Notes to Consolidated Financial Statements
</TABLE>


                      CONSOLIDATED CAPITAL EQUITY PARTNERS/TWO, L.P.
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                      (in thousands)

<TABLE>
<CAPTION>

                                                  FOR THE YEARS ENDED DECEMBER 31,
                                                    1999        1998        1997
Revenues:                                                    (restated)  (restated)
<S>                                              <C>        <C>          <C>

   Rental income                                 $  5,597    $  6,322    $  6,109
   Other income                                       610         663         492
   Casualty gain                                    5,473          --          --
      Total revenues                               11,680       6,985       6,601
Expenses:
   Operating                                        2,173       2,805       2,959
   General and administrative                         510         991         766
   Depreciation                                     1,145       1,438       1,363
   Interest                                        26,210      25,061      23,180
   Property taxes                                     570         559         556

      Total expenses                               30,608      30,854      28,824

Loss before discontinued operations and
  extraordinary item                              (18,928)    (23,869)    (22,223)

Income (loss) from discontinued operations              3       1,204        (398)

Gain on sale of discontinued operations            20,753          52       2,739

Income (loss) before extraordinary item             1,828     (22,613)    (19,882)
Extraordinary loss on debt extinguishment             (31)         --          --
Net income (loss)                                $  1,797    $(22,613)   $(19,882)
Net income (loss) allocated to general
  partner (1%)                                   $     18    $   (226)   $   (199)
Net income (loss) allocated to limited
 partners (99%)                                     1,779     (22,387)    (19,683)
                                                 $  1,797    $(22,613)   $(19,882)

               See Accompanying Notes to Consolidated Financial Statements
</TABLE>


                 CONSOLIDATED CAPITAL EQUITY PARTNERS/TWO, L.P.

                  CONSOLIDATED STATEMENTS OF PARTNERS' DEFICIT

                                  (in thousands)


                                      General        Limited
                                      Partner        Partners        Total

Partners' deficit at
   December 31, 1996                 $ (2,017)      $(201,079)   $ (203,096)

Net loss for the year ended
   December 31, 1997                     (199)        (19,683)      (19,882)

Partners' deficit
   at December 31, 1997                (2,216)       (220,762)     (222,978)

Net loss for the year ended
   December 31, 1998                     (226)        (22,387)      (22,613)

Partners' deficit at
   December 31, 1998                   (2,442)       (243,149)     (245,591)

Net income for the year ended
   December 31, 1999                       18           1,779         1,797

Partners' deficit at
   December 31, 1999                 $ (2,424)      $(241,370)   $ (243,794)

               See Accompanying Notes to Consolidated Financial Statements

                      CONSOLIDATED CAPITAL EQUITY PARTNERS/TWO, L.P.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                      (in thousands)


<TABLE>
<CAPTION>
                                                            FOR THE YEARS ENDED DECEMBER 31,
                                                             1999       1998        1997
Cash flows from operating activities:
<S>                                                      <C>           <C>        <C>

  Net income (loss)                                       $  1,797   $ (22,613)  $ (19,882)
  Adjustments to reconcile net income (loss) to net
   cash (used in) provided by operating activities:
   Depreciation                                              3,843       4,975       4,822
   Amortization of loan costs, lease commissions
      and ground lease                                          60         605         641
   Gain on disposal of properties                               --        (52)     (2,739)
   Gain on sale of discontinued operations                 (20,753)         --          --
   Extraordinary loss on early extinguishment of debt           31          --          --
   Casualty gain                                            (5,473)         --          --
  Change in accounts:
      Restricted cash                                       (7,750)         --          --
      Receivables and deposits                               1,218        (178)        224
      Other assets                                             337         (48)         (2)
      Accounts payable                                          56        (429)         94
      Tenant security deposit liabilities                     (387)         17           8
      Accrued property taxes                                  (199)        (25)        254
      Other liabilities                                       (123)        (94)        175
      Interest on Master Loan                               23,963      21,975      21,704
       Net cash (used in) provided by operating
          activities                                        (3,380)      4,133       5,299
Cash flows from investing activities:
  Insurance proceeds received                                8,406          --          --
  Property improvements and replacements                    (2,431)     (2,591)     (3,022)
  Proceeds from sale of investment properties               35,180          52       3,350
  Net withdrawals from (deposits to) restricted escrows       (550)       (454)       (583)
  Lease commissions paid                                        --        (527)       (583)
  Distributions from investment in limited partnerships         --          --         336
       Net cash provided by (used in) investing
        activities                                          40,605      (3,520)       (502)
Cash flows from financing activities:
  Prepayment penalty                                            (4)         --          --
  Advances on Master Loan                                       --         220         150
  Loan costs paid                                               --          --         (29)
  Principal payments on mortgage notes payable                (247)       (286)       (275)
  Principal payments on Master Loan                        (33,111)       (155)     (3,768)
  Repayment of mortgage notes payable                       (2,315)         --          --
       Net cash used in financing activities               (35,677)       (221)     (3,922)
Net increase in cash and cash equivalents                    1,548         392         875
Cash and cash equivalents at beginning of period             2,199       1,807         932
Cash and cash equivalents at end of period                $  3,747    $  2,199   $   1,807
Supplemental disclosure of cash flow information:
  Cash paid for interest                                  $  3,630    $  4,306   $   2,920

               See Accompanying Notes to Consolidated Financial Statements

</TABLE>

                  CONSOLIDATED CAPITAL EQUITY PARTNERS/TWO, L.P.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note A - Organization and Summary of Significant Accounting Policies

The  Partnership's  financial  statements  have been prepared  assuming that the
Partnership will continue as a going concern. The Partnership continues to incur
operating losses, suffers from inadequate liquidity, has an accumulated deficit,
and is unable to repay the  Master  Loan  balance  which  matures  in 2000.  The
Partnership  realized net income of approximately  $1,797,000 for the year ended
December  31,  1999.  This was due to the  recognition  of a gain on the sale of
discontinued  operations of approximately  $20,753,000  relating to the sales of
all seven of the Partnership's commercial properties. The Partnership incurred a
loss before the gain on the sale of  discontinued  operations  of  approximately
$18,928,000.  The General  Partner  expects the Partnership to continue to incur
such losses from operations.

The Partnership's  indebtedness to CCIP/2 under the Master Loan of approximately
$247,753,000,  including accrued interest, matures in November 2000. The General
Partner is currently in negotiations  with CCIP/2 with respect to its options on
maturity.  The  Partnership  does not have the means with which to satisfy  this
obligation. No other sources of additional financing have been identified by the
Partnership,  nor does the  General  Partner  have any other plans to remedy the
liquidity  problems the Partnership is currently  experiencing.  At December 31,
1999, partners' deficit was approximately $243,794,000.

The General Partner expects revenues from the four investment properties will be
sufficient over the next twelve months to meet all property operating  expenses,
mortgage  debt  service  requirements  and  capital  expenditure   requirements.
However,  these cash flows  will be  insufficient  to repay to CCIP/2 the Master
Loan balance, including accrued interest, in the event it is not renegotiated.

As a result of the above,  there is  substantial  doubt about the  Partnership's
ability to continue as a going concern.  The financial statements do not include
any adjustments to reflect the possible future effects on the recoverability and
classification of assets or amounts and  classifications of liabilities that may
result from these uncertainties.

Organization:  Equity  Partners/Two  ("EP/2"),  a California  Corporate  General
Partnership,  was  formed  on April 28,  1983,  to  engage  in the  business  of
acquiring,  operating and holding equity  investments in  income-producing  real
estate  properties.  Certain  of  the  general  partners  of  EP/2  were  former
shareholders and former management of Consolidated  Capital Equities Corporation
("CCEC"),  the former corporate general partner of CCIP/2 (as defined below). On
November 16, 1990, pursuant to the bankruptcy settlement discussed below, EP/2's
general  partners  executed a new  partnership  agreement (the "New  Partnership
Agreement")  whereby EP/2 converted  from a general  partnership to a California
limited partnership,  Consolidated Capital Equity Partners/Two, L.P. ("CCEP/2").
The general partners of EP/2 became limited partners of CCEP/2. ConCap Holdings,
Inc. ("CHI"), a Texas corporation, is CCEP/2's General Partner.

The operations of EP/2 were financed  substantially  through  nonrecourse  notes
with  participation  interests  (the "Master  Loan") from  Consolidated  Capital
Institutional  Properties/2 ("CCIP/2"), a California limited partnership.  These
notes are secured by the real properties  owned by and notes  receivable on sold
properties  owed  to  CCEP/2.  The  Partnership   Agreement  provides  that  the
Partnership  is to  terminate on June 24, 2011 unless  terminated  prior to such
date. The  Partnership  commenced  operations on April 28, 1983. The Partnership
operates  four  apartment  properties  located in Colorado,  Illinois,  Ohio and
Texas. Six commercial properties were sold in September, 1999 and one commercial
property was sold in December 1999.

Principles of Consolidation: The financial statements include all the amounts of
the  Partnership  and its 99.00% owned  partnership.  The General Partner of the
consolidated  partnerships is ConCap Holdings,  Inc. ConCap Holdings Inc. may be
removed  as  the  general  partner  of  the  consolidated   partnership  by  the
Registrant;   therefore,  the  consolidated   partnerships  are  controlled  and
consolidated by the Registrant.  All significant  interpartnership balances have
been eliminated.

EP/2  Bankruptcy  and  Reorganization:  During 1989,  EP/2  defaulted on certain
interest  payments  that were due to CCIP/2  under the Master  Loan and,  before
CCIP/2  was able to  exercise  its  remedies  for such  default,  EP/2 filed for
bankruptcy protection in a Chapter 11 reorganization proceeding ("Chapter 11").

On October 18, 1990, the bankruptcy  court approved  EP/2's  consensual  plan of
reorganization  (the "Plan"). On November 16, 1990, CCIP/2 consummated a closing
under the Plan  pursuant to which:  (1) CCIP/2 and EP/2  executed an amended and
restated loan agreement  ("New Master Loan  Agreement");  (2) CCEP/2 renewed the
deeds of trust on all collateral  securing the Master Loan; (3) EP/2 paid CCIP/2
cash of approximately  $2.5 million,  including $1.8 million  contributed by the
Corporate  General Partners of EP/2 related to their  promissory  notes; (4) the
general partners of EP/2 contributed certain partnership interests in affiliated
partnerships ("General Partnership Interests"),  which were valued by management
of  CCIP/2 at  approximately  $2.5  million,  that  were  assigned  to CCIP/2 as
additional  collateral  securing  the Master  Loan and (5) all  liabilities  and
claims between EP/2's  general  partners and CCIP/2 were released.  See "Note E"
for a description of the terms of the New Master Loan Agreement.

The  Corporate  Managing  General  Partner  of  EP/2  was  Consolidated  Capital
Enterprises,  Inc. ("CCEI"), a Georgia corporation. In December 1988, CCEC filed
for Chapter 11  protection.  In October 1990,  as part of CCEC's  reorganization
plan, CCEC sold its general partner interest in CCIP/2 to ConCap Equities,  Inc.
("CEI"), a Delaware  corporation.  Pursuant to the New Partnership  Agreement as
discussed above, CHI, a wholly-owned  subsidiary of CEI, became the sole general
partner of CCEP/2,  replacing  CCEI,  and the former  general  partners  of EP/2
became limited  partners of CCEP/2.  Pursuant to the New Partnership  Agreement,
CCEP/2 is managed by CHI and CHI has full  discretion with respect to conducting
CCEP/2's  business.  CHI and the limited  partners are  hereinafter  referred to
collectively  as the  "Partners."  All of  CEI's  outstanding  stock is owned by
Insignia  Properties Trust, an affiliate of Apartment  Investment and Management
Company  ("AIMCO").  (See Note B -  Transfer  of  Control),  which was  acquired
through two transactions in December 1994 and October 1995.

Use of Estimates:  The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

 Cash and Cash Equivalents:  Includes cash on hand and in banks and money market
accounts.  At certain  times,  the amount of cash deposited at a bank may exceed
the limit on insured deposits.

 Restricted Cash:  Includes  insurance  proceeds received to date related to the
casualty  at Village  Brooke (see Note C) net of costs  incurred.  This money is
restricted to be used to reconstruct the property.

 Tenant Security  Deposits:  The  Partnership  requires  security  deposits from
lessees  for the  duration  of the  lease  and such  deposits  are  included  in
receivables  and  deposits.  Deposits  are  refunded  when the  tenant  vacates,
provided  the  tenant  has not  damaged  its space and is  current on its rental
payments.

Depreciation:  Depreciation  is  provided by the  straight-line  method over the
estimated lives of the apartment  properties and related personal property.  For
Federal income tax purposes,  the  accelerated  cost recovery method is used (1)
for real property over 15 years for additions  prior to March 16, 1984, 18 years
for  additions  after March 15, 1984,  and before May 9, 1985,  and 19 years for
additions  after May 8, 1985,  and before  January 1, 1987, and (2) for personal
property over 5 years for additions prior to January 1, 1987. As a result of the
Tax Reform Act of 1986,  for  additions  after  December 31, 1986,  the modified
accelerated  cost recovery method is used for  depreciation of (1) real property
additions over 27 1/2 years and (2) personal property additions over 5 years.

Effective  January 1, 1999 the  Partnership  changed its method of accounting to
capitalize the costs of exterior painting and major landscaping (Note K).

Loan Costs: Loan costs of approximately  $418,000 and approximately  $607,000 at
December  31, 1999 and 1998,  respectively,  less  accumulated  amortization  of
approximately $198,000 and $251,000, at December 31, 1999 and 1998, respectively
are included in other assets and are being  amortized on a  straight-line  basis
over the life of the loans.  The  amortization  expense is  included in interest
expense.  As a result of the sale of Town Center and Richmond Plaza,  loan costs
of approximately  $27,000,  net of accumulated  amortization were written off in
1999.

Advertising:  The  Partnership  expenses the costs of  advertising  as incurred.
Advertising  costs of  approximately  $159,000,  $156,000,  and $158,000 for the
years ended  December 31,  1999,  1998 and 1997,  respectively,  were charged to
expense as incurred.

Investment Properties: Investment properties consist of four apartment complexes
and are  stated  at cost.  Acquisition  fees are  capitalized  as a cost of real
estate.  In accordance with Financial  Accounting  Standards Board Statement No.
121,  "Accounting  for the  Impairment of Long-Lived  Assets and for  Long-Lived
Assets  to Be  Disposed  Of,"  the  Partnership  records  impairment  losses  on
long-lived assets used in operations when events and circumstances indicate that
the assets might be impaired  and the  undiscounted  cash flows  estimated to be
generated by those assets are less than the  carrying  amounts of those  assets.
Costs of properties that have been  permanently  impaired have been written down
to appraised  value. No adjustments for impairment of value were recorded in the
years ended December 31, 1999, 1998, and 1997.

Leases: The Partnership  generally leases apartment units for twelve-month terms
or less. The Partnership recognizes income as earned on its leases. In addition,
the General Partner's policy is to offer rental concessions during  particularly
slow months or in response to heavy  competition from other similar complexes in
the area. Concessions are charged against rental income as incurred.

The Partnership  leased certain  commercial space to tenants under various lease
terms.  The leases were  accounted for as operating  leases in  accordance  with
"Financial  Accounting  Standards  Board  Statement  No. 13." Some of the leases
contained  stated  rental  increases  during  their term.  For leases with fixed
rental increases,  rents were recognized on a straight-line basis over the terms
of the lease.

For all  other  leases,  minimum  rents  were  recognized  over the terms of the
leases.

Restricted Escrow:

Reserve  Account:  A general  Reserve  Account was  established in 1996 with the
refinancing  proceeds for each mortgaged property.  These funds were established
to cover  necessary  repairs and  replacements  of existing  improvements,  debt
service,   out  of  pocket   expenses   incurred  for  ordinary  and   necessary
administrative tasks, and payment of real property taxes and insurance premiums.
The Partnership is required to make quarterly  deposits of net operating  income
(as  defined  in  the  mortgage  note)  from  each  refinanced  property  to the
respective  reserve  account.  The  balance at December  31,  1999 and 1998,  is
approximately $139,000 and $168,000, respectively, which includes interest.

Capital Improvement  Account: A Capital Improvement Account was also established
in 1996  with the  refinancing  proceeds  from  Richmond  Plaza.  This  fund was
established   to  cover   necessary   repairs  and   replacements   of  existing
improvements,  debt service,  out of pocket  expenses  incurred for ordinary and
necessary administrative tasks, and payment of real property taxes and insurance
premiums.  The  Partnership  is  required  to  make  quarterly  deposits  of net
operating  income (as defined in the mortgage note). The balance at December 31,
1998 was approximately $1,551,000 which included interest. The property was sold
in  December  1999 with the balance in this  account  being  transferred  to the
buyer.

Lease  Commissions:  Lease  commissions  are capitalized and amortized using the
straight-line method over the life of the applicable lease. At December 31, 1998
lease commissions totaled approximately $3,188,000 with accumulated amortization
of approximately  $1,837,000.  The seven  commercial  properties for which lease
commissions were applicable were sold during 1999, and the corresponding balance
in lease commissions was written off.

Allocation  of Net Income and Cash  Distributions:  Pursuant to the  Partnership
Agreement,  net  income  and net losses  for both  financial  and tax  reporting
purposes are allocated 99% to the Limited Partners and 1% to CHI.  Distributions
to the Partners are not allowed until CCEP/2 has fully paid and performed  under
the terms of the Master Loan.

Income Taxes: No provision has been made in the financial statements for Federal
income  taxes  because  under  current  law,  no Federal  income  taxes are paid
directly by CCEP/2.  The Partners are responsible for their respective shares of
CCEP/2's net income or loss. CCEP/2 reports certain transactions differently for
tax than for financial statement purposes.

The tax basis of the  Partnership's  assets  and  liabilities  is  approximately
$187,178,000  greater  than  the  assets  and  liabilities  as  reported  in the
financial statements.

Reclassifications: Certain reclassifications have been made to the 1998 and 1997
information to conform to the 1999 presentation.

Note B - Transfer of Control

Pursuant  to a series  of  transactions  which  closed  on  October  1, 1998 and
February 26, 1999,  Insignia Financial Group, Inc. and Insignia Properties Trust
merged into AIMCO, a publicly traded real estate  investment  trust,  with AIMCO
being the surviving  corporation  (the "Insignia  Merger").  As a result,  AIMCO
acquired 100% ownership  interest in the General  Partner.  The General  Partner
does not believe that this transaction has had or will have a material effect on
the affairs and operations of the Partnership.

Note C - Casualty Event

In April 1999, one of the Partnership's residential properties,  Village Brooke,
was  completely  destroyed  by a  tornado.  It is  estimated  that the  property
sustained  approximately  $16,000,000  in  damages.  As of  December  31,  1999,
$10,000,000  in insurance  proceeds have been  received.  All of the  property's
fixed assets and related  accumulated  depreciation were written off as a result
of  this  casualty.  Lost  rents  of  approximately  $750,000  and  expenses  of
approximately $844,000 have been recorded as of December 31, 1999 which resulted
in a casualty gain of approximately $5,473,000 at December 31, 1999. The General
Partner  is  currently  negotiating  with  the  taxing  authorities  to have the
property taxed as undeveloped land. The General Partner is currently  evaluating
and surveying the land to determine possible new construction of the property.

In April  1999,  an  electrical  fire  occurred  at Town  Center.  The  property
sustained  approximately  $181,000  in damages and  realized a casualty  loss of
approximately  $33,000 which is included in operating expense.  The property was
sold in  September  (see Note D). The  purchaser  of the  property  assumed  the
remaining obligations related to the fire.

Note D - Sale of Investment Property-Discontinued Operations

On  September  10,  1999,  the five  commercial  properties  located in Michigan
(Lahser One,  Lahser Two,  Crescent  Centre,  Central  Park Place,  Central Park
Plaza) were sold to an unaffiliated  third party for $26,125,000.  After closing
expenses  of  approximately   $1,727,000  the  net  proceeds   received  by  the
Partnership were approximately $24,398,000.  The sale of the properties resulted
in a gain on sale of investment property of approximately $10,392,000.

On September 22, 1999, Town Center Plaza, located in Santa Ana, California,  was
sold to an unaffiliated  third party for $11,650,000.  After closing expenses of
approximately  $1,004,000  the net  proceeds  received by the  Partnership  were
approximately  $10,646,000.  The Partnership  used some of the proceeds from the
sale  of  the  property  to  pay  off  the  debt  encumbering  the  property  of
approximately $2,316,000. The sale of the property resulted in a gain on sale of
investment   property  of   approximately   $4,862,000   and  a  loss  on  early
extinguishment of debt of approximately $7,000.

On December 23, 1999, Richmond Plaza, located in Richmond, Virginia, was sold to
an unaffiliated third party for $14,900,000. Closing expenses were approximately
$784,000.  The debt  encumbering the property of  approximately  $14,500,000 was
assumed by the buyer.  The sale of the  property  resulted  in a gain on sale of
investment   property  of   approximately   $5,499,000   and  a  loss  on  early
extinguishment of debt of approximately $24,000.

These sales  constituted  all of the  Partnership's  commercial  properties  and
accordingly  have been  classified  as  discontinued  operations at December 31,
1999. The Partnership's consolidated statements of operations have been restated
to reflect the commercial property operations as discontinued.

Revenues from discontinued operations were approximately $9,005,000, $12,250,000
and  $11,072,000  for  the  years  ended  December  31,  1999,  1998  and  1997,
respectively.

Note E - Master Loan and Accrued Interest Payable

The Master Loan principal and accrued  interest payable balances at December 31,
1999 and 1998, are approximately  $247,753,000 and  approximately  $256,901,000,
respectively.

Terms of Master Loan Agreement

Under  the  terms of the  Master  Loan,  interest  accrues  at 10% per annum and
payments are due  quarterly  in an amount  equal to Excess Cash Flow,  generally
defined in the Master  Loan  Agreement  as net cash flow from  operations  after
capital  improvements  and  third-party  debt service.  If such Excess Cash Flow
payments are less than the current accrued interest during the quarterly period,
the unpaid interest is added to principal,  compounded annually,  and is payable
at the loan's  maturity.  If such Excess Cash Flow payments are greater than the
currently  payable  interest,  the excess  amount is  applied  to the  principal
balance of the loan. The net proceeds from the sale of the commercial properties
during the year ended  December  31, 1999 were paid to CCIP/2 as required  under
the terms of the Master Loan Agreement.

Effective  January 1, 1993,  CCEP/2 and CCIP/2 amended the Master Loan Agreement
to   stipulate   that  Excess  Cash  Flow  would  be  computed  net  of  capital
improvements. Such expenditures were formerly funded from advances on the Master
Loan from  CCIP/2 to CCEP/2.  This  amendment  and change in the  definition  of
Excess Cash Flow will have the effect of reducing Master Loan payments to CCIP/2
by  the  amount  of  CCEP/2's  capital  expenditures  since  such  amounts  were
previously  excluded from Excess Cash Flow. The amendment will have no effect on
the computation of interest expense on the Master Loan.

No advances were received from CCIP/2 during the year ended December 31, 1999 as
an advance on the Master  Loan.  The Master Loan matures in November  2000.  The
General Partner has determined that the Master Loan and related interest payable
has no determinable  fair value since payments are limited to net cash flows, as
defined,  but  is  not  believed  to be in  excess  of the  fair  values  of the
underlying  collateral.  The General Partner is currently in  negotiations  with
CCIP/2 with respect to its options upon  maturity.  If the Master Loan cannot be
extended prior to maturity, the Partnership will risk losing its four investment
properties through foreclosure.

During 1999,  CCEP/2 paid down the Master Loan by  $33,111,000.  These  payments
were made from distributions received from three affiliated partnerships, excess
cash from the  Partnership's  investment  properties and from proceeds  received
from the sale of the Partnership's  commercial  properties.  During 1998, CCIP/2
loaned  approximately  $220,000 to CCEP/2 as an advance on the Master Loan. Also
during 1998,  CCEP/2 paid down the Master Loan by $155,000.  These payments were
made from distributions received from two affiliated partnerships.  During 1997,
CCIP/2 loaned approximately $150,000 to CCEP/2 as an advance on the Master Loan.
Also during 1997, CCEP/2 paid down the Master Loan by $3,768,000. These payments
were made from approximately  $461,000 of proceeds from certain  investments and
approximately $3,307,000 of proceeds from the sale of Cosmopolitan Center.

Note F - Mortgage Notes Payable

The principle terms of mortgage notes payable are as follows:

<TABLE>
<CAPTION>

                         Principal     Monthly                           Principal
                        Balance At     Payment     Stated                 Balance
                       December 31,   Including   Interest  Maturity      Due At
Property                   1999       Interest      Rate      Date       Maturity
                            (in thousands)                            (in thousands)
<S>                      <C>           <C>         <C>      <C>          <C>

Canyon Crest
  1st Mortgage           $ 2,000        $ 12       7.33%    11/01/03      $ 2,000

Highcrest Townhomes
  1st Mortgage             4,000          24       7.33%    11/01/03        4,000

Windemere
  1st Mortgage             3,000          18       7.33%    11/01/03        3,000

Village Brooke
  1st Mortgage             6,557          54       8.00%    12/01/02        6,161

  Totals                 $15,557        $108                              $15,161

</TABLE>

The mortgage notes payable are  nonrecourse and are  collateralized  by deeds of
trust on the real property.  The mortgage notes require prepayment  penalties if
repaid prior to maturity. All of these notes are superior to the Master Loan.

Scheduled  principal  payments of mortgage notes payable  subsequent to December
31, 1999, are as follows (in thousands):

          Years Ending December 31,
                   2000                      $    126
                   2001                           136
                   2002                         6,295
                   2003                         9,000
                     Total                   $ 15,557

Note G - Related Party Transactions

CCEP/2  has no  employees  and is  dependent  on the  General  Partner  and  its
affiliates for the management and administration of all partnership  activities.
Affiliates  of  the  General  Partner  provide  property  management  and  asset
management  services to the  Partnership.  CCEP/2 paid property  management fees
based upon collected gross rental revenues for property  management  services in
each of the years  ended  December  31,  1999,  1998 and 1997.  The  Partnership
Agreement  (the  "Agreement")  also  provides for  reimbursement  to the General
Partner  and  its  affiliates   for  costs  incurred  in  connection   with  the
administration of CCEP/2's activities.

Also, CCEP/2 is subject to an Investment  Advisory  Agreement between CCEP/2 and
an affiliate of the General Partner.  This agreement provides for an annual fee,
payable in monthly  installments,  to an  affiliate  of the General  Partner for
advising and consulting  services for CCEP/2's  properties.  The General Partner
and its affiliates received reimbursements and fees for the years ended December
31, 1999, 1998, and 1997 as follows:

<TABLE>
<CAPTION>

                                                           1999      1998     1997
<S>                                                     <C>        <C>       <C>

 Property management fees (included in
  operating expenses)                                     $ 304     $ 696     $ 881
 Investment advisory fees (included in general
   and administrative expense)                              178       173       154
 Lease commissions                                           --       381       380
 Reimbursement for services of affiliates
  (included in operating, general and
  administrative expenses, and investment
  properties)                                               237       292       296
 Real estate brokerage commissions (included in
   gain on sale of discontinued operations)               1,580        --        --

</TABLE>

During the years ended  December 31, 1999,  1998,  and 1997,  affiliates  of the
General  Partner  were  entitled  to  receive  5% of  gross  receipts  from  the
Registrant's  residential properties for providing property management services.
The Registrant paid to such affiliates  approximately  $304,000,  $337,000,  and
$323,000 for the years ended December 31, 1999,  1998,  and 1997,  respectively.
For the years ended December 31, 1998 and 1997 affiliates of the General Partner
were  entitled to receive  varying  percentages  of gross  receipts from all the
Registrant's  commercial  properties for providing property management services.
The Registrant paid to such affiliates $359,000 and $558,000 for the nine months
ended September 30, 1998 and the year ended December 31, 1997, respectively.  No
such fees were paid for the year ended  December 31, 1999 as these services were
provided by an unrelated third party effective October 1, 1998.

An affiliate of the General Partner received  investment advisory fees amounting
to approximately  $178,000,  $173,000, and $154,000 for the years ended December
31, 1999, 1998 and 1997, respectively.

An  affiliate  of the General  Partner  received  reimbursement  of  accountable
administrative  expense  amounting  to  approximately  $237,000,  $292,000,  and
$296,000 for the years ended December 31, 1999, 1998, and 1997, respectively.

For acting as real estate  broker in  connection  with the sales of seven of the
Partnership's commercial properties,  the General Partner was paid a real estate
commission of approximately $1,580,000 during the year ended December 31, 1999.

In addition to the compensation  and  reimbursements  described above,  interest
payments are made to and loan  advances are received from  Consolidated  Capital
Institutional  Properties/2  ("CCIP/2")  pursuant to the Master Loan  Agreement.
Such interest payments totaled approximately $998,000,  $1,834,000, and $236,000
for the years ended December 31, 1999, 1998, and 1997, respectively. Advances of
approximately  $220,000 and $150,000  were made under the Master Loan  Agreement
during the years ended  December 31, 1998 and 1997.  No advances were made under
the Master Loan Agreement during the year ended December 31, 1999. Additionally,
CCEP/2 made principal payments on the Master Loan of approximately  $33,111,000,
$155,000  and   $3,768,000   respectively.   These  funds  were   received  from
distributions  from  three  affiliated   partnerships,   excess  cash  from  the
Partnership's investment properties, and from proceeds received from the sale of
commercial properties.

Note H - Real Estate and Accumulated Depreciation

The investment properties owned by the Partnership consist of the following:
(in thousands)

<TABLE>
<CAPTION>

                                    Building
                                   & Related
                                    Personal               Accumulated   Depreciable
      Description          Land     Interest     Total     Depreciation   Life-Years
<S>                     <C>         <C>        <C>          <C>            <C>

 Canyon Crest           $   145    $ 3,603    $  3,748       $ 2,283        3-20
 Highcrest Townhomes        707      7,658       8,365         4,959        3-20
 Village Brooke           1,099         48       1,147            --        3-20
 Windmere                   780      5,919       6,699         4,075        3-20
 Total                  $ 2,731    $17,228    $ 19,959       $11,317

</TABLE>

Note I - Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the   Partnership,   the  General  Partner  and  several  of  their   affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging  the  acquisition  by Insignia  Financial  Group,  Inc.
("Insignia")  and  entities  which  were,  at one time,  affiliates  of Insignia
("Insignia  Affiliates") of interests in certain general partner entities,  past
tender offers by Insignia  Affiliates to acquire limited  partnership units, the
management of partnerships  by Insignia  Affiliates and the Insignia Merger (see
"Note B - Transfer  of  Control").  The  plaintiffs  seek  monetary  damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998,  the General  Partner filed a motion seeking  dismissal of the action.  In
lieu  of  responding  to the  motion,  the  plaintiffs  have  filed  an  amended
complaint.  The General Partner filed  demurrers to the amended  complaint which
were heard  February  1999.  Pending  the ruling on such  demurrers,  settlement
negotiations  commenced.  On November 2, 1999, the parties  executed and filed a
Stipulation of Settlement settling claims,  subject to final court approval,  on
behalf of the Partnership and all limited  partners who own units as of November
3, 1999. Preliminary approval of the settlement was obtained on November 3, 1999
from the  Superior  Court of the State of  California,  County of San Mateo,  at
which time the Court set a final approval  hearing for December 10, 1999.  Prior
to the December 10, 1999 hearing the Court  received  various  objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the  alleged  lack of  authority  of class  plaintiffs'  counsel  to  enter  the
settlement.  On  December  14,  1999,  the General  Partner  and its  affiliates
terminated the proposed  settlement.  Certain  plaintiffs have filed a motion to
disqualify  some of the plaintiffs'  counsel in the action.  The General Partner
does not anticipate that costs associated with this case will be material to the
Partnership's overall operations.

The  Partnership is unaware of any other pending or outstanding  litigation that
is not of a routine nature arising in the ordinary course of business.

Note J - Year 2000 Compliance

General Description

The Year 2000 issue is the result of computer  programs  being written using two
digits rather than four digits to define the applicable year. The Partnership is
dependent  upon the  General  Partner  and its  affiliates  for  management  and
administrative services ("Managing Agent"). Any of the Managing Agent's computer
programs or hardware that had  date-sensitive  software or embedded  chips might
have  recognized  a date using "00" as the year 1900  rather than the year 2000.
This  could  have  resulted  in a  system  failure  or  miscalculations  causing
disruptions of operations,  including, among other things, a temporary inability
to process  transactions,  send invoices,  or engage in similar normal  business
activities.

Computer Hardware, Software and Operating Equipment

In 1999,  the Managing  Agent  completed  all phases of its Year 2000 program by
completing  the  replacement  and repair of any  hardware or software  system or
operating  equipment that was not yet Year 2000 compliant.  The Managing Agent's
hardware  and software  systems and its  operating  equipment  are now Year 2000
compliant.  No  material  failure or  erroneous  results  have  occurred  in the
Managing Agent's computer  applications  related to the failure to reference the
Year 2000 to date.

Third Parties

To  date,  the  Managing  Agent  is not  aware of any  significant  supplier  or
subcontractor  (external agent) or financial institution of the Partnership that
has a Year 2000 issue that  would  have a material  impact on the  Partnership's
results of operations,  liquidity or capital  resources.  However,  the Managing
Agent  has no means of  ensuring  or  determining  the Year 2000  compliance  of
external  agents.  At this time, the Managing Agent does not believe that a Year
2000 issue of any  non-compliant  external agent will have a material  impact on
the Partnership's financial position or results of operations.

Costs

The total cost of the Managing Agent's Year 2000 project was approximately  $3.2
million and was funded from operating cash flows.

Risks Associated with the Year 2000

The Managing  Agent  completed all necessary  phases of its Year 2000 program in
1999,  and did not  experience  system or  equipment  malfunctions  related to a
failure to reference the Year 2000. The Managing  Agent or Partnership  have not
been  materially  adversely  effected by  disruptions  in the economy  generally
resulting from the Year 2000 issue.

At this  time,  the  Managing  Agent  does not  believe  that the  Partnership's
businesses,  results of  operations  or financial  condition  will be materially
adversely effected by the Year 2000 issue.

Contingency Plans Associated with the Year 2000

The  Managing  Agent has not had to implement  contingency  plans such as manual
workarounds or selecting new relationships for its banking or elevator operation
activities in order to avoid the Year 2000 issue.

Note K - Change in Accounting Principle

Effective  January 1, 1999, the Partnership  changed its method of accounting to
capitalize the costs of exterior painting and major landscaping on a prospective
basis.  The  Partnership  believes  that  this  accounting  principle  change is
preferable  because it provides a better  matching of expenses  with the related
benefit of the expenditures and it is consistent with industry  practice and the
policies  of the  General  Partner.  The  effect  of the  change  in 1999 was to
increase  income  before the change by  approximately  $48,000.  The  cumulative
effect,  had this change been applied to prior  periods,  is not  material.  The
accounting  principle  change  will  not  have an  effect  on cash  flow,  funds
available  for   distributions  or  fees  payable  to  the  General  Partner  or
affiliates.

                                    PART III

Item 10.   Directors and Executive Officers of the General Partner of the
           Partnership

The  Registrant  has no officers  or  directors.  The General  Partner is ConCap
Equities,  Inc.  ("CEI").  The names and ages of,  as well as the  position  and
offices  held by the present  executive  officers  and  directors of the General
Partner are set forth below. There are no family relationships  between or among
any officers or directors.

Name                        Age    Position

Patrick J. Foye              42    Executive Vice President and Director
Martha L. Long               40    Senior Vice President and Controller

Patrick J. Foye has been  Executive  Vice  President and Director of the General
Partner since October 1, 1998.  Mr. Foye has served as Executive  Vice President
of AIMCO since May 1998.  Prior to joining AIMCO,  Mr. Foye was a partner in the
law firm of Skadden,  Arps, Slate,  Meagher & Flom LLP from 1989 to 1998 and was
Managing Partner of the firm's  Brussels,  Budapest and Moscow offices from 1992
through  1994.  Mr.  Foye is also  Deputy  Chairman  of the  Long  Island  Power
Authority and serves as a member of the New York State Privatization Council. He
received a B.A.  from Fordham  College and a J.D.  from Fordham  University  Law
School.

Martha L. Long has been  Senior Vice  President  and  Controller  of the General
Partner and AIMCO since October 1998, as a result of the acquisition of Insignia
Financial Group,  Inc. From June 1994 until January 1997, she was the Controller
for Insignia, and was promoted to Senior Vice President - Finance and Controller
in January 1997,  retaining  that title until  October  1998.  From 1988 to June
1994,  Ms. Long was Senior Vice  President and  Controller for The First Savings
Bank, FSB in Greenville, South Carolina.

Based solely upon a review of Forms 3 and 4 and amendments  thereto furnished to
the Registrant  under Rule 16a-3(e) during the  Registrant's  most recent fiscal
year and Forms 5 and amendments thereto furnished to the Registrant with respect
to its most recent  fiscal year,  the  Registrant  is not aware of any director,
officer,  beneficial  owner of more than ten  percent  of the  units of  limited
partnership interest in the Registrant that failed to file on a timely basis, as
disclosed in the above Forms,  reports required by section 16(a) of the Exchange
Act during the most recent  fiscal year or prior fiscal years except as follows:
AIMCO and its joint  filers  failed to timely file a Form 4 with  respect to its
acquisition of Units.

Item 11. Executive Compensation

None  of  the  directors  and  officers  of the  General  Partner  received  any
remuneration from the Registrant.

Item 12. Security Ownership of Certain Beneficial Owners and Management

Except  as  noted  below,  no  person  was  known  by the  Registrant  to be the
beneficial  owner  of  more  than 5% of the  Limited  Partnership  Units  of the
Registrant as of December 31, 1999:

Entity                                  Number of Units      Percentage

Reedy River Properties

(an affiliate of AIMCO)                    168,736.5           18.56%
Insignia Properties LP
(an affiliate of AIMCO)                     17,240.6            1.89%
AIMCO Properties, LP
(an affiliate of AIMCO)                    117,459.9           12.92%
Cooper River Properties, LLC
(an affiliate of AIMCO)                     67,518.7            7.43%

Reedy River Properties, Insignia Properties LP, and Cooper River Properties, LLC
are indirectly  ultimately owned by AIMCO.  Their business address is 55 Beattie
Place, Greenville, SC 29602.

AIMCO Properties LP is indirectly  ultimately  controlled by AIMCO. Its business
address is 2000 South Colorado Boulevard, Denver, Colorado 80222.

No  directors  or  officers  of  the  General  Partner  owns  any  Units  of the
Partnership of record or beneficially.

Item 13. Certain Relationships and Related Transactions

The Partnership has no employees and is dependent on the General Partner and its
affiliates for the management and administration of all Partnership activities.

The Partnership  Agreement (the  "Agreement")  provides for reimbursement to the
General  Partner and its affiliates  for costs  incurred in connection  with the
administration of Partnership  activities.  The following  payments were made to
the General  Partner and  affiliates  during the years ended  December 31, 1999,
1998, and 1997:

                                                For the years ended December 31,
                                                   1999        1998        1997
                                                         (in thousands)
Reimbursements for services of affiliates
  (included in general and administrative
     expenses)                                    $ 217        $ 303      $ 278

An  affiliate  of the General  Partner  received  reimbursement  of  accountable
administrative  expenses  amounting  to  approximately  $217,000,  $303,000  and
$278,000 for the years ended December 31, 1999, 1998 and 1997, respectively.

Several tender offers were made by various parties,  including affiliates of the
General Partners,  during the years ended December 31, 1999, 1998 and 1997. As a
result of these tender offers, AIMCO and its affiliates currently own 370,955.70
units  of  limited   partnership   interest  in  the  Partnership   representing
approximately  40.80% of the outstanding units. It is possible that AIMCO or its
affiliates will make one or more additional offers to acquire additional limited
partnership  interests in the  Partnership  for cash or in exchange for units in
the  operating  partnership  of AIMCO.  Consequently,  AIMCO is in a position to
significantly  influence all voting  decisions  with respect to the  Registrant.
Under the Partnership Agreement, unitholders holding a majority of the Units are
entitled  to take action  with  respect to a variety of matters.  When voting on
matters,  AIMCO would in all  likelihood  vote the Units it acquired in a manner
favorable to the interest of the General  Partner  because of their  affiliation
with the General Partner.

                                     PART IV

Item 14.    Exhibits, Financial Statements, Schedules and Reports on Form 8-K

      (a)   Exhibits

            Exhibit 27, Financial Data Schedule,  is filed as an exhibit to this
            report.

      (b)   Reports on Form 8-K filed in the fourth quarter of fiscal year 1999:

            A Form 8-K/A dated  September 22, 1999, as filed with the Securities
            and Exchange Commission on November 16, 1999, in connection with the
            sale of Towne Center Plaza.

            A Form 8-K dated December 23, 1999, as filed with the Securities and
            Exchange  Commission on January 7, 2000, in connection with the sale
            of Richmond Plaza.

                                   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.

                                 CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/2

                                    By:   ConCap Equities, Inc.
                                          Its General Partner

                                    By:   /s/Patrick J. Foye
                                          Patrick J. Foye
                                          Executive Vice President

                                    By: /s/Martha L. Long
                                          Martha L. Long
                                          Senior Vice President
                                          and Controller

                              Date: March 29, 2000

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities on the date indicated.

/s/Patrick J. Foye                                    Date: March 29, 2000
Patrick J. Foye
Executive Vice President and Director


/s/Martha L. Long                                     Date: March 29, 2000
Martha L. Long
Senior Vice President and Controller


<PAGE>


                     CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES 2

                                  EXHIBIT INDEX

Exhibit Number    Description of Exhibit

      2.1         Agreement and Plan of Merger,  dated as of October 1, 1998
                  between AIMCO and IPT.

      3           Certificates of Limited Partnership, as amended to date.

      10.1        Amended Loan Agreement dated November 15, 1990 (the "Effective
                  Date"), by and between the Partnership and EP/2  (Incorporated
                  by  reference  to the Annual  Report on Form 10-K for the year
                  ended December 31, 1990 ("1990 Annual Report")).

      10.2        Assumption  Agreement as of the Effective Date, by and between
                  EP/2 and CCEP/2  (Incorporated by reference to the 1990 Annual
                  Report).

      10.3        Assignment  of Claims  as of the  Effective  Date,  by and
                  between  the Partnership  and EP/2. (Incorporated by reference
                  to the 1990 Annual Report).

      10.4        Assignment of  Partnership  Interests in CC Office  Associates
                  and Broad and Locust  Associates  dated November 16, 1990 (the
                  effective date), by and between EP/2 and CCEP/2  (Incorporated
                  by reference to the 1990 Annual Report).

      10.5        Property Management Agreement No. 113 dated  October 23, 1990,
                  by and between the  Partnership  and CCEC  (Incorporated  by
                  reference to the Quarterly Report on Form 10-Q for the quarter
                  ended September 30, 1990).

      10.6        Bill of Sale and  Assignment  dated  October 23, 1990,  by and
                  between  CCEC and ConCap  Services  Company  (Incorporated  by
                  reference to the Quarterly Report on Form 10-Q for the quarter
                  ended September 30, 1990).

      10.7        Assignment  and  Assumption  dated  October 23,  1990,  by and
                  between  CCEC  and  ConCap  Management   Limited   Partnership
                  ("CCMLP")  (Incorporated  by reference to the Quarterly Report
                  on Form 10-Q for the quarter ended September 30, 1990).

      10.8        Assignment  and  Agreement as to Certain  Property  Management
                  Services  dated  October 23,  1990,  by and between  CCMLP and
                  ConCap  Capital  Company  (Incorporated  by  reference  to the
                  Quarterly  Report on Form 10-Q for the quarter ended September
                  30, 1990).

      10.9        Assignment  and  Agreement  dated  October  23,  1990,  by and
                  between  CCMLP and The Hayman  Company (100 Series of Property
                  Management   Contracts)(Incorporated   by   reference  to  the
                  Quarterly  Report on Form 10-Q for the quarter ended September
                  30, 1990).

      10.10       Construction  Management  Cost  Reimbursement  Agreement dated
                  January 1, 1991, by and between the Partnership and The Hayman
                  Company.  (Incorporated  by reference to the Annual  Report on
                  Form 10-K for the year ended December 31, 1991).

      10.11       Investor  Services  Agreement  dated  October 23, 1990, by and
                  between the Partnership and CCEC (Incorporated by reference to
                  the  Quarterly  Report  on Form  10-Q  for the  quarter  ended
                  September 30, 1990).

      10.12       Assignment  and  Assumption   Agreement   (Investor   Services
                  Agreement)  dated  October 23,  1990 by and  between  CCEC and
                  ConCap Services Company.

      10.13       Letter of Notice dated  December 20,  1991,  from  Partnership
                  Services, Inc. ("PSI") to the Partnership regarding the change
                  in  ownership  and  dissolution  of  ConCap  Services  Company
                  whereby   PSI  assumed  the   Investor   Services   Agreement.
                  (Incorporated  by reference to the Annual  Report on Form 10-K
                  for the year ended December 31, 1991).

      10.14       Financial  Services  Agreement  dated October 23, 1990, by and
                  between the Partnership and CCEC (Incorporated by reference to
                  the  Quarterly  Report  on Form  10-Q  for the  quarter  ended
                  September  30,  1990)  (Incorporated  by reference to the 1990
                  Annual Report).

      10.15       Assignment  and  Assumption   Agreement   (Financial  Services
                  Agreement)  dated  October 23,  1990,  by and between CCEC and
                  ConCap  Capital  Company  (Incorporated  by  reference  to the
                  Quarterly  Report on Form 10-Q for the quarter ended September
                  30, 1990).

      10.16       Letter of Notice  dated  December  20,  1991,  from PSI to the
                  Partnership  regarding the change in ownership and dissolution
                  of ConCap  Capital  Company  whereby PSI assumed the Financial
                  Services  Agreement.  (Incorporated by reference to the Annual
                  Report on Form 10-K for the year ended December 31, 1991).

      10.17       Property Management Agreement No.501 dated  February 16, 1993,
                  by and between the Partnership and Coventry Properties,  Inc.
                  (Incorporated by reference to the Annual Report on Form 10-K
                  for the year ended  December 31, 1992)

      10.18       Property  Management Agreement No.  412  dated  May 13,  1993,
                  by and between Consolidated Capital Equity  Partners/Two  L.P.
                  and Coventry Properties,  Inc.  (Incorporated by reference to
                  the Quarterly Report on Form 10-Q for the quarter ended
                  September 30, 1993).

      10.19       Assignment and Assumption  Agreement (Property  Management
                  Agreement No. 412) dated May 13, 1993, by and between Coventry
                  Properties, Inc., R&B Apartment  Management  Company  Inc.
                  and  Partnership  Services,   Inc. (Incorporated  by reference
                  to the Quarterly Report on Form 10-Q for the quarter ended
                  September 30, 1993).

      10.20       Assignment  and  Agreement as to Certain  Property  Management
                  Services dated  May 13,  1993,  by and  between  Coventry
                  Properties, Inc.  and Partnership Services, Inc. (Incorporated
                  by reference to the Quarterly Report on Form 10-Q for the
                  quarter ended September 30, 1993).

      10.21       Property Management Agreement  No.  413  dated  May 13,  1993,
                  by and between Consolidated Capital Equity  Partners/Two  L.P.
                  and Coventry Properties,  Inc.  (Incorporated by reference to
                  the Quarterly Report on Form 10-Q for the quarter ended
                  September 30, 1993).

      10.22       Assignment and Assumption  Agreement (Property  Management
                  Agreement No. 413) dated May 13, 1993, by and between Coventry
                  Properties,  Inc., R&B Apartment  Management  Company,  Inc.
                  and Partnership Services, Inc.(Incorporated  by reference to
                  the Quarterly Report on Form 10-Q for the quarter ended
                  September 30, 1993).

      10.23       Assignment  and  Agreement as to Certain  Property  Management
                  Services dated  May 13,  1993,  by and  between  Coventry
                  Properties, Inc.  and Partnership Services, Inc. (Incorporated
                  by reference to the Quarterly Report on Form 10-Q for the
                  quarter ended September 30, 1993).

      10.24       Contract  for sale of real  estate for North Park Plaza  dated
                  September 12, 1996, between Consolidated Capital Institutional
                  Properties/2,  a California limited partnership and North Park
                  Southfield, L.L.C., a Michigan limited liability company.

      10.25       Contract  for sale of real estate for Lahser One,  Lahser Two,
                  Crescent  Centre,  Central Park Place,  and Central Park Plaza
                  dated   September  10,  1999  between   Consolidated   Capital
                  Institutional  Properties/2,  a California limited partnership
                  and Southfield  Office  Properties,  LLC. (Filed with Form 8-K
                  dated September 10, 1999)

      10.26       Second   amendment  to  purchase  and  sale  contract  between
                  Consolidated Capital Institutional Properties/2,  a California
                  limited partnership and Southfield Office Properties,  LLC for
                  sale of real  estate  for Lahser  One,  Lahser  Two,  Crescent
                  Centre, Central Park Place, and Central Park Plaza (Filed with
                  Form 8-K dated September 10, 1999)

      10.27       Reinstatement  of and Third  amendment  to  purchase  and sale
                  contract   between    Consolidated    Capital    Institutional
                  Properties/2,  a California limited partnership and Southfield
                  Office Properties, LLC for sale of real estate for Lahser One,
                  Lahser Two,  Crescent Centre,  Central Park Place, and Central
                  Park Plaza (Filed with Form 8-K dated September 10, 1999)

      10.28       Contract  for sale of real estate for Towne Center Plaza dated
                  September 22, 1999 between Consolidated Capital  Institutional
                  Properties/2  , a California  limited  partnership  and Colton
                  Real Estate Group,  d/b/a The Colton  Company (Filed with Form
                  8-K/A dated September 22, 1999)

      10.29       Contract  for sale for real  estate for  Richmond  Plaza dated
                  December 23, 1999 between Consolidated  Capital  Institutional
                  Properties/2,   a  California  limited   partnership  and  The
                  Bernstein Companies (Filed with Form 8-K dated December 23,
                  1999)

      11          Statement  regarding  computation of Net Income per Limited
                  Partnership Unit (Incorporated  by  reference  to  Note  1 of
                  Item  8 -  Financial Statements of this Form 10-K).

      16          Letter,  dated  August  12,  1992,  from  Ernst & Young to the
                  Securities  and  Exchange   Commission   regarding  change  in
                  certifying accountant.  (Incorporated by reference to Form 8-K
                  dated August 6, 1992).

      27          Financial  Data  Schedule   containing  summary  financial
                  information extracted  from the balance sheet and  statement
                  of operations  which is qualified in its entirety by reference
                  to such financial statements.

      28.1        Fee Owner's Limited  Partnership  Agreement dated November 14,
                  1990 (Incorporated by reference to the 1990 Annual Report).

      99.1        Consolidated  Capital  Equity  Partners/Two,   L.P.,  audited
                  financial statements for the years ended December 31, 1999 and
                  1998.