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

                                   Form 10-QSB

(Mark One)
[X]   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934

                 For the quarterly period ended September 30, 2002


[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934


                For the transition period from _________to _________

                         Commission file number 0-14530


                        DAVIDSON INCOME REAL ESTATE, L.P.
        (Exact name of small business issuer as specified in its charter)



         Delaware                                           62-1242144
(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)

                                 (864) 239-1000
                           (Issuer's telephone number)



<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS



                        DAVIDSON INCOME REAL ESTATE, L.P.

                           CONSOLIDATED BALANCE SHEET
                                   (Unaudited)
                        (in thousands, except unit data)

                               September 30, 2002

<TABLE>
<CAPTION>


Assets
<S>                                                                          <C>
   Cash and cash equivalents                                                 $ 576
   Receivables and deposits                                                     183
   Restricted escrows                                                           170
   Other assets                                                                 228
   Investment properties:
       Land                                                  $ 4,120
       Buildings and related personal property                 23,105
                                                               27,225
       Less accumulated depreciation                          (14,945)       12,280
                                                                           $ 13,437
Liabilities and Partners' (Deficit) Capital
Liabilities
   Accounts payable                                                          $ 35
   Tenant security deposit liabilities                                           88
   Accrued property taxes                                                       354
   Other liabilities                                                            240
   Deficit in joint venture                                                     802
   Mortgage notes payable, net                                               12,623

Partners' (Deficit) Capital
   General partners                                           $ (793)
   Limited partners (26,776 units issued and
      outstanding)                                                 88          (705)
                                                                           $ 13,437

            See Accompanying Notes to Consolidated Financial Statements
</TABLE>



<PAGE>






                        DAVIDSON INCOME REAL ESTATE, L.P.

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

<TABLE>
<CAPTION>

                                       Three Months Ended        Nine Months Ended
                                         September 30,             September 30,
                                       2002          2001        2002        2001
Revenues:
<S>                                   <C>          <C>          <C>         <C>
  Rental income                       $ 1,142      $ 1,195      $ 3,406     $ 3,525
  Other income                            106           77          244         201
     Total revenues                     1,248        1,272        3,650       3,726

Expenses:
  Operating                               549          562        1,565       1,620
  General and administrative               53           59          163         177
  Depreciation                            271          264          825         803
  Interest                                259          261          772         780
  Property taxes                          115          110          353         354
     Total expenses                     1,247        1,256        3,678       3,734

Income (loss) before equity in
  income (loss) of joint venture            1           16          (28)         (8)
Equity in income (loss) of
   joint venture                           10           28          (24)         79

Net income (loss)                      $ 11          $ 44        $ (52)      $ 71

Net income (loss) allocated to
  general partners (3%)                $ --          $ 1         $ (2)        $ 2
Net income (loss) allocated to
  limited partners (97%)                  11            43          (50)         69
                                      $   11          $ 44        $ (52)      $ 71
Net income (loss) per limited
  partnership unit                    $ 0.41        $ 1.61      $ (1.87)    $ 2.58

Distributions per limited
  partnership unit                    $ 11.85       $ 4.59      $ 48.11     $ 18.86


            See Accompanying Notes to Consolidated Financial Statements
</TABLE>


<PAGE>





                        DAVIDSON INCOME REAL ESTATE, L.P.

          CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' (DEFICIT) CAPITAL
                                   (Unaudited)
                        (in thousands, except unit data)

<TABLE>
<CAPTION>


                                     Limited
                                   Partnership   General      Limited
                                      Units      Partners    Partners       Total

<S>                                   <C>          <C>        <C>          <C>
Original capital contributions        26,776       $ 1        $26,776      $26,777

Partners' (deficit) capital at
   December 31, 2001                  26,776      $ (751)     $ 1,426       $ 675

Distributions to partners                 --         (40)      (1,288)      (1,328)

Net loss for the nine months
   ended September 30, 2002               --          (2)         (50)         (52)

Partners' (deficit) capital
   at September 30, 2002              26,776      $ (793)      $ 88        $ (705)


            See Accompanying Notes to Consolidated Financial Statements
</TABLE>


                        DAVIDSON INCOME REAL ESTATE, L.P.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>



                                                                 Nine Months Ended
                                                                   September 30,
                                                                   2002        2001
Cash flows from operating activities:
<S>                                                              <C>          <C>
  Net (loss) income                                              $ (52)       $ 71
  Adjustments to reconcile net (loss) income to net cash
   provided by operating activities:
   Depreciation                                                     825          803
   Amortization of discounts and loan costs                          50           49
   Equity in loss (income) of joint venture                          24          (79)
   Change in accounts:
      Receivables and deposits                                       15           43
      Other assets                                                  (69)         (23)
      Accounts payable                                              (69)          (9)
      Tenant security deposit liabilities                            30           (7)
      Accrued property taxes                                        (23)          (2)
      Other liabilities                                              89           (7)
       Net cash provided by operating activities                    820          839

Cash flows from investing activities:
  Property improvements and replacements                           (290)        (491)
  Net withdrawals from restricted escrows                           100           21
  Distributions from joint venture                                  817          168
       Net cash provided by (used in) investing activities          627         (302)

Cash flows from financing activities:
  Payments on mortgage notes payable                               (137)        (123)
  Distributions to partners                                      (1,328)        (521)
  Loan costs paid                                                    --          (11)
       Net cash used in financing activities                     (1,465)        (655)

Net decrease in cash and cash equivalents                           (18)        (118)

Cash and cash equivalents at beginning of period                    594          573
Cash and cash equivalents at end of period                       $ 576        $ 455

Supplemental disclosure of cash flow information:
  Cash paid for interest                                         $ 723        $ 718

            See Accompanying Notes to Consolidated Financial Statements
</TABLE>



<PAGE>






                        DAVIDSON INCOME REAL ESTATE, L.P.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


Note A - Basis of Presentation

The accompanying  unaudited consolidated financial statements of Davidson Income
Real Estate,  L.P. (the  "Partnership"  or  "Registrant")  have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information  and  with the  instructions  to Form  10-QSB  and  Item  310(b)  of
Regulation  S-B.  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 Davidson Diversified  Properties,  Inc.
(the  "Managing  General  Partner"),   all  adjustments  (consisting  of  normal
recurring  accruals)  considered  necessary  for a fair  presentation  have been
included.  Operating  results for the three and nine months ended  September 30,
2002, are not necessarily indicative of the results that may be expected for the
fiscal year ending  December 31,  2002.  For further  information,  refer to the
consolidated   financial  statements  and  footnotes  thereto  included  in  the
Partnership's  Annual  Report on Form 10-KSB for the fiscal year ended  December
31, 2001. The Managing  General Partner is an affiliate of Apartment  Investment
and  Management  Company  ("AIMCO"),  a publicly  traded real estate  investment
trust.

Note B - Transactions with Affiliated Parties

The  Partnership  has no employees  and is  dependent  on the  Managing  General
Partner  and  its  affiliates  for  the  management  and  administration  of all
Partnership  activities.  The Partnership Agreement provides for (i) payments to
affiliates for services and (ii)  reimbursement of certain expenses  incurred by
affiliates on behalf of the Partnership.

During the nine months  ended  September  30, 2002 and 2001,  affiliates  of the
Managing  General Partner were entitled to receive 5% of gross receipts from all
of  the  Partnership's   properties  as  compensation  for  providing   property
management  services.  The  Partnership  paid to such  affiliates  approximately
$189,000 and $191,000  for the nine months  ended  September  30, 2002 and 2001,
respectively, which is included in operating expenses.

An  affiliate  of  the  Managing  General  Partner  received  reimbursements  of
accountable  administrative  expenses  amounting to  approximately  $117,000 and
$270,000 for the nine months ended  September  30, 2002 and 2001,  respectively,
which are  included  in  general  and  administrative  expenses  and  investment
properties.   Included  in  these  amounts  are  fees  related  to  construction
management  services provided by an affiliate of the Managing General Partner of
approximately  $5,000 and $163,000 for the nine months ended  September 30, 2002
and 2001, respectively.  The construction management service fees are based on a
percentage of current year additions to investment properties.

Beginning in 2001, the  Partnership  began insuring its properties up to certain
limits through coverage provided by AIMCO which is generally  self-insured for a
portion of losses and  liabilities  related  to workers  compensation,  property
casualty and vehicle liability. The Partnership insures its properties above the
AIMCO  limits  through  insurance  policies  obtained  by  AIMCO  from  insurers
unaffiliated  with the General  Partner.  During the nine months ended September
30,  2002 and 2001,  the  Partnership  was  charged by AIMCO and its  affiliates
approximately $59,000 and $33,000, respectively, for insurance coverage and fees
associated with policy claims administration.


<PAGE>




Note C - Deficit in Joint Venture

The  Partnership  owns a 17.5% interest in the Sterling Crest Joint Venture with
Davidson Growth Plus, L.P., an affiliate of the Managing General Partner,  which
owns the remaining 82.5% of the joint venture.

During the nine months  ended  September  30,  2002,  the  Partnership  received
distributions  of  approximately  $817,000 from the joint venture  consisting of
approximately  $785,000 for its portion of the excess proceeds received from the
refinancing  of the joint  venture's  investment  property  in January  2002 and
approximately  $32,000 from  operations of the joint  venture.  The  Partnership
received  distributions of  approximately  $168,000 from operations of the joint
venture  during the nine months ended  September  30, 2001.  For the nine months
ended September 30, 2002, the Partnership  recognized  approximately  $24,000 of
equity in the loss of the joint venture,  which was net of approximately $54,000
due to the  loss  incurred  on the  early  extinguishment  of debt at the  joint
venture's investment property. For the nine months ended September 30, 2001, the
Partnership   recognized   equity  in  the  income  of  the  joint   venture  of
approximately $79,000.

The  following  table  represents  the net  liabilities  of the joint venture at
September 30, 2002 and net (loss) income for the nine months ended September 30,
2002 and 2001 (in thousands):

                                             September 30, 2002

Total assets                                      $ 6,981
Total liabilities                                  11,584

Net deficiency                                    $(4,603)

                                                 Nine Months Ended September 30,
                                                    2002                2001

Total revenues                                    $ 1,941             $ 2,016
Total expenses                                      2,079               1,561
Net (loss) income                                 $  (138)                455

Note D - 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. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the  Partnership,  its Managing  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,  among other
things,  the  acquisition  of  interests  in certain  Managing  General  Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities which were,
at one  time,  affiliates  of  Insignia;  past  tender  offers  by the  Insignia
affiliates to acquire limited partnership units;  management of the partnerships
by the  Insignia  affiliates;  and the series of  transactions  which  closed on
October 1, 1998 and February 26, 1999 whereby  Insignia and Insignia  Properties
Trust,  respectively,  were merged  into AIMCO.  The  plaintiffs  seek  monetary
damages and equitable relief, including judicial dissolution of the Partnership.
On June 25, 1998, the Managing General Partner filed a motion seeking  dismissal
of the action.  In lieu of responding  to the motion,  the  plaintiffs  filed an
amended  complaint.  The Managing 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 court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  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 prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying  them  from the case and an  appeal  was  taken  from the order on
October 5, 2000. On December 4, 2000, the Court  appointed the law firm of Lieff
Cabraser  Heimann & Bernstein  LLP as new lead  counsel for  plaintiffs  and the
putative class.  Plaintiffs filed a third amended complaint on January 19, 2001.
On March 2, 2001,  the  Managing  General  Partner  and its  affiliates  filed a
demurrer to the third amended  complaint.  On May 14, 2001,  the Court heard the
demurrer to the third amended  complaint.  On July 10, 2001, the Court issued an
order  sustaining  defendants'  demurrer on certain  grounds.  On July 20, 2001,
Plaintiffs filed a motion for reconsideration of the Court's July 10, 2001 order
granting in part and denying in part defendants' demurrer. On September 7, 2001,
Plaintiffs  filed a fourth amended class and  derivative  action  complaint.  On
September 12, 2001, the Court denied Plaintiffs' motion for reconsideration.  On
October 5, 2001, the Managing General Partner and affiliated  defendants filed a
demurrer to the fourth amended complaint,  which was heard on December 11, 2001.
On February 2, 2002,  the Court served its order  granting in part the demurrer.
The  Court has  dismissed  without  leave to amend  certain  of the  plaintiffs'
claims.  On February 11, 2002,  plaintiffs  filed a motion  seeking to certify a
putative  class  comprised of all  non-affiliated  persons who own or have owned
units  in  the  partnerships.   The  Managing  General  Partner  and  affiliated
defendants  oppose the motion.  On April 29,  2002,  the Court held a hearing on
plaintiffs' motion for class  certification and took the matter under submission
after further briefing,  as order by the court, was submitted by the parties. On
July 10, 2002,  the Court  entered an order  vacating the current  trial date of
January 13, 2003 (as well as the  pre-trial  and  discovery  cut-off  dates) and
stayed the case in its entirety through November 7, 2002 so that the parties can
have an  opportunity  to discuss  settlement.  On October  30,  2002,  the court
entered an order extending the stay in effect through January 10, 2003.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the Managing  General  Partner and affiliated
defendants  moved to strike the first  amended  complaint  in its  entirety  for
violating  the Court's July 10, 2001 order  granting in part and denying in part
defendants'  demurrer in the Nuanes action, or alternatively,  to strike certain
portions of the complaint based on the statute of limitations.  Other defendants
in the action  demurred to the fourth  amended  complaint,  and,  alternatively,
moved to strike the complaint. On December 11, 2001, the court heard argument on
the motions  and took the matters  under  submission.  On February 4, 2002,  the
Court  served  notice of its order  granting  defendants'  motion to strike  the
Heller complaint as a violation of its July 10, 2001 order in the Nuanes action.
On March 27, 2002,  the plaintiffs  filed a notice  appealing the order striking
the complaint. The parties are currently in the midst of briefing that appeal.

The Managing  General Partner does not anticipate that any costs,  whether legal
or  settlement  costs,  associated  with  these  cases 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.


<PAGE>




ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The Private  Securities  Litigation  Reform Act of 1995 provides a "safe harbor"
for forward-looking  statements in certain circumstances.  The matters discussed
in this report contain certain forward-looking  statements,  including,  without
limitation,  statements regarding future financial performance and the effect of
government regulations. The discussions of the Registrant's business and results
of operations,  including forward-looking statements pertaining to such matters,
do not take into account the effects of any changes to the Registrant's business
and  results of  operations.  Actual  results may differ  materially  from those
described in the forward-looking statements and will be affected by a variety of
risks and factors  including,  without  limitation:  national and local economic
conditions; the terms of governmental regulations that affect the Registrant and
interpretations of those regulations;  the competitive  environment in which the
Registrant  operates;  financing risks,  including the risk that cash flows from
operations  may be  insufficient  to meet  required  payments of  principal  and
interest;  real estate risks, including variations of real estate values and the
general  economic  climate in local markets and  competition for tenants in such
markets; and possible environmental liabilities. Readers should carefully review
the Registrant's financial statements and the notes thereto, as well as the risk
factors  described in the documents the Registrant  files from time to time with
the Securities and Exchange Commission.

The Partnership's investment properties consist of four apartment complexes. The
following table sets forth the average  occupancy of the properties for the nine
months ended September 30, 2002 and 2001:

                                                   Average Occupancy
      Property                                      2002       2001

      Northsprings Apartments                       89%        90%
         Atlanta, Georgia
      Lakeside Apartments                           91%        89%
         Charlotte, North Carolina
      Bexley House Apartments                       99%        92%
         Columbus, Ohio
      Covington Pointe Apartments                   88%        91%
         Dallas, Texas

The  Managing  General  Partner  attributes  the increase in occupancy at Bexley
House Apartments to an increased marketing effort by the property's  management.
The Managing  General Partner  attributes the decrease in occupancy at Covington
Pointe  Apartments to the eviction of several  delinquent  tenants and increased
market competition in the Dallas area.

Results of Operations

The Partnership realized a net loss of approximately $52,000 for the nine months
ended September 30, 2002 as compared to net income of approximately  $71,000 for
the nine months ended September 30, 2001. The Partnership realized net income of
approximately  $11,000 for the three months ended September 30, 2002 as compared
to net income of approximately  $44,000 for the three months ended September 30,
2001.  The decrease in income for the three and nine months ended  September 30,
2002 is primarily due to a decrease in equity in income of the joint venture and
total revenues partially offset by a decrease in total expenses.  Total revenues
decreased  for the three  and nine  months  ended  September  30,  2002 due to a
decrease in rental  income  partially  offset by an  increase  in other  income.
Rental income  decreased for the three and nine months ended  September 30, 2002
due to a decrease in occupancy  and an increase in bad debt at Covington  Pointe
Apartments and Northsprings Apartments and a decrease in average rental rates at
all of the Partnership's  investment  properties partially offset by an increase
in occupancy at Bexley House  Apartments and Lakeside  Apartments.  Other income
for the three and nine  months  ended  September  30, 2002  increased  due to an
increase in utilities  reimbursements at all of the Partnership's properties and
lease  cancellation  fees  at  Northsprings   Apartments  and  Covington  Pointe
Apartments  partially  offset by a decrease  in  interest  income as a result of
lower cash balances  maintained in interest  bearing accounts by the Partnership
and its investment properties.

For the nine months ended September 30, 2002, the Partnership  recognized equity
in loss of the joint venture  property of  approximately  $24,000 as compared to
equity in income of the joint venture property of approximately  $79,000 for the
nine months ended September 30, 2001. The Partnership  recognized  approximately
$10,000  equity in income of the joint  venture  property  for the three  months
ended  September 30, 2002.  For the three months ended  September 30, 2001,  the
Partnership  recognized  approximately  $28,000 of equity in income of the joint
venture property.  The Partnership owns a 17.5% interest in Sterling Crest Joint
Venture (the "Joint Venture"). Equity in income from the joint venture decreased
due  primarily  to a  loss  on  early  extinguishment  of  debt  related  to the
refinancing  of the joint venture  property in January 2002.  The  Partnership's
equity in this loss was approximately $54,000.

Total expenses  decreased for the three and nine months ended September 30, 2002
due to a decrease in operating and general and administrative expenses partially
offset by an increase in depreciation expense.  Operating expenses decreased due
to a decrease  in  property  and  advertising  expenses  partially  offset by an
increase in maintenance and insurance  expenses.  Property expense decreased due
to a decrease in utility bills and employee  salaries at Bexley House Apartments
and Northsprings Apartments.  Advertising expense decreased due to a decrease in
periodical  advertising at Bexley House Apartments,  Covington Pointe Apartments
and Northsprings Apartments. Maintenance expense increased due to an increase in
contract work and building  improvements  at Northsprings  Apartments  partially
offset by a  decrease  in  contract  work at  Covington  Pointe  Apartments  and
Lakeside Apartments. Insurance expense increased due to an increase in insurance
premiums at Covington Pointe Apartments.  Depreciation  expense increased due to
capital  improvements  placed  into  service  during the past  twelve  months at
Lakeside Apartments and Northsprings Apartments.

General and administrative expense for the three and nine months ended September
30,  2002  decreased  due  to a  decrease  in  professional  and  administrative
expenses. Included in general and administrative expenses for the three and nine
months ended September 30, 2002 are costs of services included in the management
reimbursements  to the Managing General Partner as allowed under the Partnership
Agreement.  Also  included were costs  associated  with the quarterly and annual
communications  with the investors and regulatory  agencies and the annual audit
required by the Partnership Agreement.

As part of the ongoing  business plan of the  Partnership,  the Managing 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 Managing 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 Managing General Partner will be able to sustain such a plan.

Liquidity and Capital Resources

At  September  30,  2002,  the  Partnership  had cash and  cash  equivalents  of
approximately $576,000 compared to approximately $455,000 at September 30, 2001.
For the nine months ended September 30, 2002 cash and cash equivalents decreased
by approximately  $18,000 from the Partnership's  fiscal year ended December 31,
2001.  The  decrease  in  cash  and  cash  equivalents  is due to  approximately
$1,465,000   of  cash  used  in  financing   activities   partially   offset  by
approximately   $627,000  of  cash   provided  by   investing   activities   and
approximately  $820,000 of cash provided by operating  activities.  Cash used in
financing  activities  consisted primarily of distributions paid to the partners
and, to a lesser extent, payments of principal made on the mortgages encumbering
the Partnership's  investment properties.  Cash provided by investing activities
consisted of distributions received from the Partnership's joint venture and net
withdrawals from restricted escrows maintained by the mortgage lenders which was
slightly  offset by property  improvements  and  replacements.  The  Partnership
invests its working capital reserves in interest bearing accounts.

The Partnership received  distributions of approximately $817,000 from the joint
venture  consisting  of  approximately  $785,000  for its  portion of the excess
proceeds  received  from  the  refinancing  of the  joint  venture's  investment
property in January 2002 and approximately  $32,000 from operations at the joint
venture.

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 investment  properties to adequately  maintain the
physical  assets and other operating needs of the Partnership and to comply with
Federal,  state,  and local  legal and  regulatory  requirements.  The  Managing
General  Partner  monitors  developments  in the  area of legal  and  regulatory
compliance and is studying new federal laws, including the Sarbanes-Oxley Act of
2002. The Sarbanes-Oxley Act of 2002 mandates or suggests additional  compliance
measures with regard to governance,  disclosure, audit and other areas. In light
of these changes,  the  Partnership  expects that it will incur higher  expenses
related  to  compliance,  including  increased  legal  and audit  fees.  Capital
improvements planned for the Partnership's properties are detailed below.

Northsprings Apartments

During the nine months ended  September  30,  2002,  the  Partnership  completed
approximately  $84,000  of  budgeted  and  unbudgeted  capital  improvements  at
Northsprings  Apartments,  consisting  primarily of plumbing  improvements,  air
conditioning  unit  replacements,  parking lot upgrades and  appliance and floor
covering  replacements.  These improvements were funded from operating cash flow
and replacement reserves.  The Partnership has budgeted,  but is not limited to,
approximately $58,000 for capital improvements for the year 2002 at Northsprings
Apartments  consisting  primarily of structural  improvements and floor covering
replacements.  Additional  improvements may be considered and will depend on the
physical  condition  of  the  property  as  well  as  replacement  reserves  and
anticipated cash flow generated by the property.

Lakeside Apartments

During the nine months ended  September  30,  2002,  the  Partnership  completed
approximately   $114,000  of  capital   improvements  at  Lakeside   Apartments,
consisting  primarily  of floor  covering  replacements,  wall  covering,  water
submetering,  office computers,  and plumbing upgrades.  These improvements were
funded  primarily  from  operating  cash  flow  and  replacement  reserves.  The
Partnership  has  budgeted,  but is not limited to,  approximately  $142,000 for
capital  improvements  for the  year  2002  at  Lakeside  Apartments  consisting
primarily of HVAC replacements,  water submetering,  structural improvements and
appliance  and  floor  covering  replacements.  Additional  improvements  may be
considered and will depend on the physical  condition of the property as well as
replacement reserves and anticipated cash flow generated by the property.


<PAGE>



Bexley House Apartments

During the nine months ended  September  30,  2002,  the  Partnership  completed
approximately  $27,000  of  capital  improvements  at Bexley  House,  consisting
primarily  of HVAC and floor  covering  replacements.  These  improvements  were
funded from operating cash flow and  replacement  reserves.  The Partnership has
budgeted,  but is not limited to, approximately $36,000 for capital improvements
for the year 2002 at Bexley House Apartments consisting primarily of fire safety
enhancements,  light  fixtures,  and  floor  covering  replacements.  Additional
improvements may be considered and will depend on the physical  condition of the
property as well as replacement  reserves and anticipated cash flow generated by
the property.

Covington Pointe Apartments

During the nine months ended  September  30,  2002,  the  Partnership  completed
approximately  $65,000 of capital  improvements at Covington Pointe  Apartments,
consisting  primarily  of  roof  replacements,   appliance  and  floor  covering
replacements, structural improvements, and HVAC replacements. These improvements
were funded  primarily from operating cash flow. The  Partnership  has budgeted,
but is not limited  to,  approximately  $72,000  for the year 2002 at  Covington
Pointe  Apartments  consisting  primarily of swimming  pool  improvements,  HVAC
replacements,  interior decoration, structural upgrades, and appliance and floor
covering replacements. Additional improvements may be considered and will depend
on the physical  condition of the property as well as  replacement  reserves and
anticipated cash flow generated by the property.

The additional  capital  expenditures will be incurred only if cash is available
from operations or from Partnership  reserves.  To the extent that such budgeted
capital improvements are completed,  the Partnership's  distributable cash flow,
if any, may be adversely affected at least in the short term.

The Partnership's  current assets are thought to be sufficient for any near-term
needs  (exclusive  of capital  improvements)  of the  Partnership.  The mortgage
indebtedness of approximately  $12,623,000,  net of discounts, is amortized over
varying periods with approximately $6,081,000 due at maturity in October of 2003
for  Northsprings  and  Covington  Pointe and  approximately  $4,100,000  due in
November of 2003 for  Lakeside  Apartments.  The Managing  General  Partner will
attempt to refinance and/or sell the properties prior to such maturity dates. If
the  properties  cannot  be  refinanced  or sold for a  sufficient  amount,  the
Partnership may risk losing such properties through foreclosure.

The Partnership  distributed the following  amounts during the nine months ended
September 30, 2002 and 2001 (in thousands, except per unit data):

<TABLE>
<CAPTION>

                     Nine Months          Per          Nine Months          Per
                        Ended           Limited           Ended           Limited
                    September 30,     Partnership     September 30,     Partnership
                         2002             Unit             2001             Unit

<S>                    <C>              <C>              <C>               <C>
Operations             $  620           $22.45           $  454            $16.43
Refinancing (1)           708            25.66               67              2.43
                       $1,328           $48.11           $  521            $18.86
</TABLE>

(1)   From the refinance of the joint venture property for the nine months ended
      September 30, 2002 and Bexley House  Apartments  for the nine months ended
      September 30, 2001.


<PAGE>



The  Partnership's  cash  available  for  distribution  is reviewed on a monthly
basis. Future cash distributions will depend on the levels of net cash generated
from  operations,  the  availability  of cash  reserves,  and the timing of debt
maturities,  refinancings  and/or  property  sales.  There can be no  assurance,
however,  that the Partnership  will generate  sufficient  funds from operations
after  required  capital  improvements  to permit further  distributions  to its
partners during the remainder of 2002 or subsequent  periods.  Distributions may
be restricted by the requirement to deposit net operating  income into a reserve
account until it is funded a minimum of $200 and a maximum of $400 per apartment
unit at Northsprings  Apartments and Covington Pointe  Apartments for a total of
approximately $60,000 to $120,000. The reserve account at September 30, 2002 was
approximately $97,000.

Other

In addition to its indirect  ownership of the general  partner  interests in the
Partnership,  AIMCO and its affiliates owned 11,910.5 limited  partnership units
(the "Units") in the Partnership representing 44.48% of the outstanding Units at
September  30,  2002. A number of these Units were  acquired  pursuant to tender
offers  made by  AIMCO  or its  affiliates.  It is  possible  that  AIMCO or its
affiliates will acquire additional units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
44.48% of the outstanding  Units, AIMCO is in a position to influence all voting
decisions with respect to the Registrant.  Although the Managing General Partner
owes fiduciary duties to the limited  partners of the Partnership,  the Managing
General Partner also owes fiduciary duties to AIMCO as its sole stockholder.  As
a result,  the duties of the  Managing  General  Partner,  as  managing  general
partner, to the Partnership and its limited partners may come into conflict with
the duties of the Managing General Partner to AIMCO, as it sole stockholder.

Critical Accounting Policies and Estimates

The consolidated financial statements are prepared in accordance with accounting
principles generally accepted in the United States which require the Partnership
to  make  estimates  and  assumptions.  The  Partnership  believes  that  of its
significant  accounting  policies,  the following may involve a higher degree of
judgment and complexity.

Impairment of Long-Lived Assets

Investment  properties  are  recorded at cost,  less  accumulated  depreciation,
unless  considered  impaired.  If  events  or  circumstances  indicate  that the
carrying  amount of a property may be  impaired,  the  Partnership  will make an
assessment of its  recoverability  by estimating  the  undiscounted  future cash
flows,  excluding  interest  charges,  of the property.  If the carrying  amount
exceeds the aggregate  future cash flows,  the  Partnership  would  recognize an
impairment  loss to the extent the carrying amount exceeds the fair value of the
property.

Real  property  investments  are  subject  to varying  degrees of risk.  Several
factors  may  adversely  affect  the  economic  performance  and  value  of  the
Partnership's  investment  properties.  These  factors  include  changes  in the
national,  regional and local economic  climate;  local  conditions,  such as an
oversupply  of  multifamily   properties;   competition   from  other  available
multifamily  property  owners and changes in market  rental  rates.  Any adverse
changes in these factors could cause an impairment in the Partnership's assets.


<PAGE>



Revenue Recognition

The Partnership generally leases apartment units for twelve-month terms or less.
Rental income  attributable to leases is recognized monthly as it is earned. The
Partnership will offer rental concessions during  particularly slow months or in
response  to  heavy  competition  from  other  similar  complexes  in the  area.
Concessions are charged to income as incurred.

ITEM 3.     CONTROLS AND PROCEDURES

The principal  executive officer and principal financial officer of the Managing
General Partner, who are the equivalent of the Partnership's principal executive
officer and principal financial officer,  respectively,  have, within 90 days of
the filing date of this  quarterly report, evaluated  the  effectiveness  of the
Partnership's  disclosure  controls and  procedures  (as defined in Exchange Act
Rules  (13a-14(c)  and  (15d-14(c))  and have  determined  that such  disclosure
controls and procedures are adequate.  There have been no significant changes in
the Partnership's internal controls or in other factors that could significantly
affect the  Partnership's  internal  controls since the date of evaluation.  The
Partnership does not believe any significant deficiencies or material weaknesses
exist in the Partnership's internal controls. Accordingly, no corrective actions
have been taken.



<PAGE>




                           PART II - OTHER INFORMATION


ITEM 1.     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. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the  Partnership,  its Managing  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,  among other
things,  the  acquisition  of  interests  in certain  Managing  General  Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities which were,
at one  time,  affiliates  of  Insignia;  past  tender  offers  by the  Insignia
affiliates to acquire limited partnership units;  management of the partnerships
by the  Insignia  affiliates;  and the series of  transactions  which  closed on
October 1, 1998 and February 26, 1999 whereby  Insignia and Insignia  Properties
Trust,  respectively,  were merged  into AIMCO.  The  plaintiffs  seek  monetary
damages and equitable relief, including judicial dissolution of the Partnership.
On June 25, 1998, the Managing General Partner filed a motion seeking  dismissal
of the action.  In lieu of responding  to the motion,  the  plaintiffs  filed an
amended  complaint.  The Managing 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 court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  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 prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying  them  from the case and an  appeal  was  taken  from the order on
October 5, 2000. On December 4, 2000, the Court  appointed the law firm of Lieff
Cabraser  Heimann & Bernstein  LLP as new lead  counsel for  plaintiffs  and the
putative class.  Plaintiffs filed a third amended complaint on January 19, 2001.
On March 2, 2001,  the  Managing  General  Partner  and its  affiliates  filed a
demurrer to the third amended  complaint.  On May 14, 2001,  the Court heard the
demurrer to the third amended  complaint.  On July 10, 2001, the Court issued an
order  sustaining  defendants'  demurrer on certain  grounds.  On July 20, 2001,
Plaintiffs filed a motion for reconsideration of the Court's July 10, 2001 order
granting in part and denying in part defendants' demurrer. On September 7, 2001,
Plaintiffs  filed a fourth amended class and  derivative  action  complaint.  On
September 12, 2001, the Court denied Plaintiffs' motion for reconsideration.  On
October 5, 2001, the Managing General Partner and affiliated  defendants filed a
demurrer to the fourth amended complaint,  which was heard on December 11, 2001.
On February 2, 2002,  the Court served its order  granting in part the demurrer.
The  Court has  dismissed  without  leave to amend  certain  of the  plaintiffs'
claims.  On February 11, 2002,  plaintiffs  filed a motion  seeking to certify a
putative  class  comprised of all  non-affiliated  persons who own or have owned
units  in  the  partnerships.   The  Managing  General  Partner  and  affiliated
defendants  oppose the motion.  On April 29,  2002,  the Court held a hearing on
plaintiffs' motion for class  certification and took the matter under submission
after further briefing,  as order by the court, was submitted by the parties. On
July 10, 2002,  the Court  entered an order  vacating the current  trial date of
January 13, 2003 (as well as the  pre-trial  and  discovery  cut-off  dates) and
stayed the case in its entirety through November 7, 2002 so that the parties can
have an  opportunity  to discuss  settlement.  On October  30,  2002,  the court
entered an order extending the stay in effect through January 10, 2003.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the Managing  General  Partner and affiliated
defendants  moved to strike the first  amended  complaint  in its  entirety  for
violating  the Court's July 10, 2001 order  granting in part and denying in part
defendants'  demurrer in the Nuanes action, or alternatively,  to strike certain
portions of the complaint based on the statute of limitations.  Other defendants
in the action  demurred to the fourth  amended  complaint,  and,  alternatively,
moved to strike the complaint. On December 11, 2001, the court heard argument on
the motions  and took the matters  under  submission.  On February 4, 2002,  the
Court  served  notice of its order  granting  defendants'  motion to strike  the
Heller complaint as a violation of its July 10, 2001 order in the Nuanes action.
On March 27, 2002,  the plaintiffs  filed a notice  appealing the order striking
the complaint. The parties are currently in the midst of briefing that appeal.

The Managing  General Partner does not anticipate that any costs,  whether legal
or  settlement  costs,  associated  with  these  cases will be  material  to the
Partnership's overall operations.


<PAGE>



ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

            a) Exhibits:

                  3.1   Agreement  of Limited  Partnership  is  incorporated  by
                        reference  to  Exhibit  A  to  the   Prospectus  of  the
                        Registrant  dated  July  26,  1985  as  filed  with  the
                        Commission pursuant to July 424(b) under the Act.

                  3.2   Amendment to Partnership Agreement dated October 1, 1985
                        is  incorporated  by  reference  to  Exhibit  3A to  the
                        Registrant's  Annual  Report on Form 10-K for the fiscal
                        year ended December 31, 1987.

                  4.1   Certificate of Limited  Partnership dated April 29, 1985
                        is  incorporated  by  reference  to  Exhibit  4  to  the
                        Registrant's  Registration  Statement on Form S-11 dated
                        May 7, 1985.

                  4.2   Certificate  of  Amendment  to  Certificate  of  Limited
                        Partnership  dated  July  16,  1985 is  incorporated  by
                        reference   to   Exhibit  4B  in   Amendment   No  1  to
                        Registration Statement No. 2-97539, dated July 24, 1985.

                  99    Certification of Chief  Executive   Officer   and  Chief
                        Financial Officer

            b) Reports on Form 8-K:

                  None filed during the quarter ended September 30, 2002.


<PAGE>


                                   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.



                                    DAVIDSON INCOME REAL ESTATE, L.P.


                                    By:   DAVIDSON DIVERSIFIED PROPERTIES, INC.
                                          Managing General Partner


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


                                    By:   /s/Thomas C. Novosel
                                          Thomas C. Novosel
                                          Senior Vice President
                                          and Chief Accounting Officer


                                    Date: November 13, 2002


<PAGE>



                                  CERTIFICATION


I, Patrick J. Foye, certify that:


1. I have reviewed this quarterly  report on Form 10-QSB of Davidson Income Real
Estate, L.P.;


2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities, particularly during the period in which this quarterly report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      quarterly report (the "Evaluation Date"); and


      c)  Presented  in  this  quarterly   report  our  conclusions   about  the
      effectiveness  of the  disclosure  controls  and  procedures  based on our
      evaluation as of the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date:  November 13, 2002

                                _______________________
                                Patrick J. Foye
                                Executive  Vice   President    of    Davidson
                                Diversified Properties,  Inc., equivalent of the
                                chief executive officer of the Partnership


<PAGE>



                                  CERTIFICATION


I, Paul J. McAuliffe, certify that:


1. I have reviewed this quarterly  report on Form 10-QSB of Davidson Income Real
Estate, L.P.;


2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities, particularly during the period in which this quarterly report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      quarterly report (the "Evaluation Date"); and


      c)  Presented  in  this  quarterly   report  our  conclusions   about  the
      effectiveness  of the  disclosure  controls  and  procedures  based on our
      evaluation as of the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date:  November 13, 2002

                                _______________________
                                Paul J. McAuliffe
                                Executive  Vice  President  and Chief  Financial
                                Officer of Davidson Diversified Properties,
                                Inc.,  equivalent of the chief financial officer
                                of the Partnership


<PAGE>


Exhibit 99


                          Certification of CEO and CFO
                       Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002



In connection  with the Quarterly  Report on Form 10-QSB of Davidson Income Real
Estate, L.P. (the  "Partnership"),  for the quarterly period ended September 30,
2002 as filed with the  Securities  and Exchange  Commission  on the date hereof
(the  "Report"),  Patrick  J. Foye,  as the  equivalent  of the chief  executive
officer of the  Partnership,  and Paul J.  McAuliffe,  as the  equivalent of the
chief financial officer of the Partnership,  each hereby certifies,  pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that, to the best of his knowledge:

      (1)   The Report fully complies with the  requirements of Section 13(a) or
            15(d) of the Securities Exchange Act of 1934; and

      (2)   The  information  contained in the Report  fairly  presents,  in all
            material respects, the financial condition and results of operations
            of the Partnership.


                                           /s/Patrick J. Foye
                                    Name:  Patrick J. Foye
                                    Date:  November 13, 2002


                                           /s/Paul J. McAuliffe
                                    Name:  Paul J. McAuliffe
                                    Date:  November 13, 2002


This  certification  accompanies  the  Report  pursuant  to  Section  906 of the
Sarbanes-Oxley  Act of 2002 and shall not,  except to the extent required by the
Sarbanes-Oxley  Act of 2002, be deemed filed by the  Partnership for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended.