FORM 10-Q--QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
                    OF THE SECURITIES EXCHANGE ACT OF 1934
             (As last amended by Rel. No. 312905, eff. 4/26/93.)

                                UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                  FORM 10-Q

[X]  Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

                For the quarterly period ended March 31, 1997

                                      or

[ ]  Transition Report Under Section 13 or 15(d) of the Securities Exchange Act
     of 1934


              For the transition period from.........to.........
              (Amended by Exch Act Rel No. 312905. eff 4/26/93.)

                        Commission file number 0-14187


               CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3
            (Exact name of registrant as specified in its charter)

         California                                      94-2940208
(State or other jurisdiction of                       (I.R.S. Employer
incorporation or organization)                        Identification No.)

One Insignia Financial Plaza, P.O. Box 1089
      Greenville, South Carolina                            29602
(Address of principal executive offices)                  (Zip Code)

                 Registrant's telephone number (864) 239-1000

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

                        PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

a)             CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3

                                BALANCE SHEET
                       (in thousands, except unit data)

<TABLE>
<CAPTION>
                                                        March 31,     December 31,
                                                          1997           1996
                                                       (Unaudited)      (Note)
<S>                                                   <C>             <C>
Assets
  Cash and cash equivalents:
     Unrestricted                                      $ 16,693        $ 15,813
     Restricted - tenant security deposits                  440             432
  Accounts receivable                                       396             416
  Investments                                               109             109
  Escrows for taxes and insurance                           408             347
  Restricted escrows                                      1,944           2,174
  Other assets                                            1,033           1,059
  Investment properties:
     Land                                                12,371          12,371
     Building and related personal property              49,902          49,450
                                                         62,273          61,821
     Less accumulated depreciation                      (13,313)        (12,634)
                                                         48,960          49,187
                                                       $ 69,983        $ 69,537

Liabilities and Partners' Capital (Deficit)

Liabilities
    Mortgage notes payable                             $ 30,525        $ 30,525
    Accounts payable                                        429             580
    Tenant security deposits                                446             434
    Accrued taxes                                           308             183
    Other liabilities                                       423             519
                                                         32,131          32,241
Partners' Capital (Deficit)
  General partner                                          (437)           (443)
  Limited partners (383,033 units outstanding)           38,289          37,739
                                                         37,852          37,296
                                                       $ 69,983        $ 69,537
<FN>
Note: The balance sheet at December 31, 1996 has been derived from the audited
      financial statements at that date but does not include all the information 
      and footnotes required by generally accepted accounting principles for 
      complete financial statements.

                See Accompanying Notes to Financial Statements
</TABLE>

b)                CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3

                              STATEMENTS OF OPERATIONS
                                    (Unaudited)
                          (in thousands, except unit data)



                                                      Three Months Ended
                                                          March 31,
                                                      1997            1996
Revenues:
  Rental income                                     $ 3,358        $ 3,011
  Interest and other income                             390            241
  Gain on casualty event                                 21             --
     Total revenues                                   3,769          3,252

Expenses:
  Operating                                           1,127          1,149
  General and administrative                            121            160
  Maintenance                                           463            420
  Depreciation                                          691            662
  Interest                                              579            369
  Property taxes                                        232            217
     Total expenses                                   3,213          2,977

       Net income                                   $   556        $   275

Net income allocated to general partners (1%)       $     6        $     3
Net income allocated to limited partners (99%)          550            272
                                                    $   556        $   275

Net income per limited partnership unit             $  1.44        $   .71

                   See Accompanying Notes to Financial Statements

c)                CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3

                STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
                                    (Unaudited)

                          (in thousands, except unit data)
<TABLE>
<CAPTION>
                                      Limited
                                    Partnership     General      Limited
                                        Units       Partner      Partners     Total
<S>                                  <C>           <C>          <C>         <C>
Original capital contributions        383,033       $     1      $95,758     $95,759
Partners' capital (deficit) at
  December 31, 1995                   383,033       $  (407)     $43,868     $43,461
Distributions to partners                  --           (18)      (4,302)     (4,320)
Net income for the three months
  ended March 31, 1996                     --             3          272         275
Partners' capital (deficit) at
  March 31, 1996                      383,033       $  (422)     $39,838     $39,416


Partners' capital (deficit) at
  December 31, 1996                   383,033       $  (443)     $37,739     $37,296
Net income for the three months
  ended March 31, 1997                     --             6          550         556
Partners' capital (deficit) at
  March 31, 1997                      383,033       $  (437)     $38,289     $37,852
<FN>
                   See Accompanying Notes to Financial Statements
</TABLE>

d)                CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3

                              STATEMENTS OF CASH FLOWS
                                    (Unaudited)
                                   (in thousands)
<TABLE>
<CAPTION>
                                                                  Three Months Ended
                                                                       March 31,
                                                                  1997              1996
<S>                                                           <C>               <C>
Cash flows from operating activities:
  Net income                                                   $   556           $   275
  Adjustments to reconcile net income to
    net cash provided by operating activities:
    Depreciation                                                   691               662
    Amortization of lease commissions and
      loan costs                                                    34                14
    Gain on casualty event                                         (21)               --
    Loss on disposal of property                                    41                61
    Change in accounts:
      Restricted cash                                               (8)               (4)
      Accounts receivable                                          155               139
      Escrows for taxes and insurance                              (61)              (58)
      Other assets                                                  (4)               58
      Accounts payable                                            (291)             (320)
      Tenant security deposit liabilities                           12                 6
      Accrued taxes                                                125               159
      Other liabilities                                            (96)               81

            Net cash provided by operating activities            1,133             1,073

Cash flows from investing activities:
  Property improvements and replacements                          (475)             (368)
  Deposits to restricted escrows                                  (101)               (7)
  Receipts from restricted escrows                                 331               188
  Cash received from borrower on foreclosed
    property                                                        --                74

         Net cash used in investing activities                    (245)             (113)

Cash flows from financing activities:
  Loan costs paid                                                   (8)              (27)
  Payments on mortgage notes payable                                --               (45)
  Distributions to partners                                         --            (4,320)

         Net cash used in financing activities                      (8)           (4,392)

Net increase (decrease) in cash and cash equivalents               880            (3,432)

Cash and cash equivalents at beginning of period                15,813             9,871

Cash and cash equivalents at end of period                     $16,693           $ 6,439

Supplemental disclosure of cash flow information:
  Cash paid for interest                                       $   549           $   358
<FN>
                   See Accompanying Notes to Financial Statements
</TABLE>

                  CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3

                        STATEMENTS OF CASH FLOW (Continued)
                                    (Unaudited)


SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITY

Acquisition

On February 14, 1996, Consolidated Capital Institutional Properties/3 foreclosed
on South City Business Center, the investment property collateralizing the note
receivable between Consolidated Capital Institutional Properties/3 and Lincoln
South City Business Center Limited Partnership.  As of March 31, 1996, in
connection with this transaction, the following accounts had been adjusted by
the amounts noted (dollar amounts in thousands):


Receipt of cash                     $   74
Investment properties                4,326
Notes receivable                     4,400


Casualty event

At March 31, 1997, as a result of a fire at Lake Villa, investment properties,
accounts receivable and accounts payable were adjusted $26,000, $135,000 and
$140,000, respectively for non-cash activity.



e)                CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3

                           NOTES TO FINANCIAL STATEMENTS
                                    (Unaudited)


NOTE A - BASIS OF PRESENTATION

The accompanying unaudited financial statements of Consolidated Capital
Institutional Properties/3 (the "Partnership") have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of ConCap Equities, Inc. (the "General Partner"), all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three month period
ended March 31, 1997, are not necessarily indicative of the results that may be
expected for the fiscal year ending December 31, 1997.  For further information,
refer to the financial statements and footnotes thereto included in the
Partnership's annual report on Form 10-K for the fiscal year ended December 31,
1996.

Presentation of Accounts

Certain reclassifications have been made to the 1996 information to conform to
the 1997 presentation.

Investments

Investments consisting primarily of commercial paper with original maturities of
more than ninety days, are considered to be held-to-maturity securities.

NOTE B - INVESTMENT PROPERTY ACQUIRED

During 1995, it was determined that the note secured by the South City Business
Center was impaired.  Accordingly, during 1995, the Partnership recorded a
write-down to adjust the note balance to the estimated net realizable value of
the collateral.  Foreclosure proceedings were completed on February 14, 1996, at
which time the Partnership assumed operations at the property.  The estimated
net realizable value at the time of acquisition was $4,400,000 including cash of
$74,000 which the partnership received along with the South City assets of
approximately $4,326,000.

NOTE C - RELATED PARTY TRANSACTIONS

The Partnership has paid property management fees based on collected gross
rental revenues for property management services in each of the three months
ended March 31, 1997 and 1996.  Property management fees of approximately
$177,000 and $161,000 were paid to affiliates of the General Partner for the
three months ending March 31, 1997 and 1996, respectively.

The Partnership Agreement also provides for reimbursement to the General Partner
and its affiliates for costs incurred in connection with administration of
Partnership activities.  Reimbursements for services of affiliates of
approximately $88,000 and $83,000 were paid to the General Partner and
affiliates for the three months ended March 31, 1997 and 1996.  Additionally,
the Partnership paid $16,000 and $7,000 during the three month periods ended
March 31, 1997 and 1996, to an affiliate of the General Partner for lease
commissions at the Partnership's commercial properties. These lease commissions
are included in other assets and amortized over the term of the respective
leases.  The Partnership also paid $20,000 and $3,000 to affiliates of the
general partner for the three months ended March 31, 1997 and 1996,
respectively, for reimbursement of construction oversight costs related to major
property improvement and repair projects at the Partnership's investment
properties.

The Partnership insures its properties under a master policy through an agency
and insurer unaffiliated with the General Partner.  An affiliate of the General
Partner acquired, in the acquisition of a business, certain financial
obligations from an insurance agency which was later acquired by the agent who
placed the current year's master policy.  The agent assumed the financial
obligations to the affiliate of the General Partner who receives payments on
these obligations from the agent.  The amount of the Partnership's insurance
premiums accruing to the benefit of the affiliate of the General Partner by
virtue of the agent's obligations is not significant.

NOTE D - 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.  Cash, tenant security deposits and
investments, totaling $17,242,000 were  greater than the reserve requirement of
approximately $3,939,000 at March 31, 1997.

NOTE E - SUBSEQUENT EVENT

On April 2, 1997, the Partnership paid a distribution of $838,000 from
operations and $6,161,000 from surplus funds.

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


The Partnership's investment properties consist of eight apartment complexes and
two commercial properties.  The following table sets forth the average occupancy
of the properties for each of the three months ended March 31, 1997 and 1996:

                                                    Average
                                                   Occupancy

Property                                        1997        1996

Cedar Rim Apartments                             94%         91%
  Renton, Washington
City Heights Apartments                          95%         96%
  Seattle, Washington
Corporate Center Office Complex                  96%         96%
  Tampa, Florida
Hidden Cove by the Lake Apartments               94%         89%
  Belleville, Michigan
Lamplighter Park Apartments                      93%         98%
  Belleview, Washington
Park Capitol Apartments                          99%         99%
  Salt Lake City, Utah
Tamarac Village Apartments                       93%         89%
  Denver, Colorado
Williamsburg Manor Apartments                    97%         95%
  Cary, North Carolina
Sandpiper Apartments                             94%         83%
  St. Petersburg, Florida
South City Business Center                       89%         83%
  Chula Vista, California

The General Partner attributes the increase in occupancy at Hidden Cove to
unusually low occupancy during the first quarter of 1996 due to management's
efforts in early 1996 to increase resident qualification standards in order to
reduce unit damages and delinquencies.  By the first quarter of 1997, occupancy
has stabilized.  The decrease in occupancy at Lamplighter Park is due to fire
damage to twelve units that has negatively impacted 1997 occupancy levels.
Occupancy levels at the property are expected to increase once the damaged units
are repaired.  The increase in occupancy at Tamarac Apartments is attributed to
property improvements and increased leasing efforts combined with a strong local
economy.  The occupancy increase at Sandpiper is due to interior and exterior
renovations and improved market conditions.  South City Business Center's
occupancy increase is due to a stronger local market in 1997.

The Partnership realized net income of $556,000 for the three months ended March
31, 1997, compared to $275,000 for the three months ended March 31, 1996.  The
increase in net income for the three month period ended March 31, 1997 is
primarily attributable to increased rental income resulting from improved
occupancy and increased rental rates at several properties.  In addition,
interest and other income increased as a result of increased tenant charges at
various properties as well as greater interest earned on higher levels of
invested funds.  Total revenues were positively affected by South City's revenue
for the full three months ended March 31, 1997, compared to the period from
February 14, 1996, the date of South City's acquisition, to March 31, 1996.
Also contributing to the increase in net income was a casualty gain of $21,000
relating to fire damage at Hidden Cove by The Lake Apartments.  The January fire
damaged ten units in one building at the complex. General and administrative
expenses decreased for the three months ended March 31, 1997 compared to the
corresponding period in 1996 due to lower professional fees. Offsetting these
changes was an increase in interest expense.  The increase in interest expense
is due primarily to the refinancing of Tamarac Village and Lamplighter Park and
new debt on Hidden Cove, Cedar Rim and City Heights, whose debt balances
increased approximately $12.5 million in November of 1996.

Included in maintenance expenses for the three months ended March 31, 1997, is
approximately $127,000 of major repairs and maintenance comprised primarily of
exterior renovations, major landscaping and exterior painting.  For the three
months ended March 31, 1996, approximately $101,000 of  major repairs and
maintenance comprised primarily of exterior building renovations, major
landscaping and parking lot rehabilitation is included in maintenance expenses.

On February 14, 1996, the Partnership foreclosed on South City Business Center,
the investment property collateralizing the note receivable between the
Partnership and Lincoln South City Business Center Limited Partnership at which
time the Partnership assumed operations of the property.  The estimated net
realizable value at the time of acquisition was $4,400,000 including cash of
$74,000 which the partnership received along with the South City assets of
approximately $4,326,000.

As part of the ongoing business plan of the Partnership, the General Partner
monitors the rental market environment of each of its investment properties to
assess the feasibility of increasing rents, maintaining or increasing occupancy
levels and protecting the Partnership from increases in expenses.  As part of
this plan, the General Partner attempts to protect the Partnership from the
burden of inflation-related increases in expenses by increasing rents and
maintaining a high overall occupancy level.  However, due to changing market
conditions, which can result in the use of rental concessions and rental
reductions to offset softening market conditions, there is no guarantee that the
General Partner will be able to sustain such a plan.

At March 31, 1997, the Partnership held unrestricted cash of approximately
$16,693,000 compared to approximately $6,439,000 at March 31, 1996.  Net cash
provided by operating activities increased primarily due to increased rental
revenues and interest income, offset by increased interest payments as discussed
above.   Net cash used in investing activities increased primarily due to
increased property improvements and replacements in 1997.  Net cash used in
financing activities decreased primarily because there were no distributions to
partners during the three months ended March 31, 1997.

The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the various properties to adequately maintain the
physical assets and other operating needs of the Partnership.  Such assets are
currently thought to be sufficient for any near-term needs of the Partnership.
The notes payable of approximately $30,525,000 have maturity dates ranging from
1997 to 2007, at which time the individual properties will be refinanced or
sold.  The mortgage notes payable are nonrecourse and are secured by pledges of
the respective properties. All notes require prepayment penalties if repaid
prior to maturity and prohibit resale of the properties subject to existing
indebtedness.  Distributions of approximately $4,320,000 were made to the
partners during the three months ended March 31, 1996. On April 2, 1997, the
Partnership paid a distribution of $838,000 from operations and $6,161,000 from
surplus funds.  Future cash distributions will depend on the levels of net cash
generated from operations, property sales, and the availability of cash
reserves.




                            PART II - OTHER INFORMATION


ITEM 6.  EXHIBITS 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:

          None filed during the quarter ended March 31, 1997.



                                     SIGNATURES



  In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.



                             CONSOLIDATED CAPITAL INSTITUTIONAL
                             PROPERTIES/3

                             By: CONCAP EQUITIES, INC.
                                 General Partner


                             By:/s/William H. Jarrard, Jr.
                                William H. Jarrard, Jr.
                                President


                             By:/s/Ronald Uretta
                                Ronald Uretta
                                Vice President/Treasurer


                             Date: May 15, 1997