FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

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

                 For the quarterly period ended March 31, 1999
   --------------------------------------------------------------------------

                                       OR

             ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT of 1934

  For the transition period from _____________________ to ____________________


                             Commission file number
                                     0-23968
                     ---------------------------------------


                           CNL Income Fund XIII, Ltd.
   -------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

<TABLE>
<CAPTION>

<S> <C>
                       Florida                                                        59-3143094
------------------------------------------------------              ------------------------------------------------
(State or other jurisdiction of                                                    (I.R.S. Employer
incorporation or organization)                                                    Identification No.)


400 East South Street
Orlando, Florida                                                                         32801
------------------------------------------------------              ------------------------------------------------
      (Address of principal executive offices)                                        (Zip Code)


Registrant's telephone number
(including area code)                                                               (407) 650-1000
                                                                    ------------------------------------------------
</TABLE>


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by  Sections  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 _________




<PAGE>


                                    CONTENTS





Part I                                                                     Page

   Item 1.    Financial Statements:

                  Condensed Balance Sheets                         

                  Condensed Statements of Income                   

                  Condensed Statements of Partners' Capital        

                  Condensed Statements of Cash Flows               

                  Notes to Condensed Financial Statements          

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

   Item 3.   Quantitative and Qualitative Disclosures About Market
                  Risk                                             
Part II

   Other Information                                               


<PAGE>
                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>


                                                                              March 31,              December 31,
                                                                                 1999                    1998
                                                                          -------------------     -------------------
<S> <C>
                               ASSETS

   Land and  buildings on operating  leases, less
       accumulated  depreciation  of
       $2,210,970 and $2,107,624 and
       allowance for loss on building
       of $297,885 in 1999 and 1998                                             $ 22,842,012            $ 22,945,358
   Net investment in direct financing leases                                       6,930,543               6,951,890
   Investment in joint ventures                                                    2,449,068               2,451,336
   Cash and cash equivalents                                                         687,717                 766,859
   Receivables, less allowance for doubtful
       accounts of $817 and $532                                                      69,067                 121,119
   Prepaid expenses                                                                   24,630                   8,453
   Lease costs, less accumulated
       amortization of $436 in 1999                                                   35,314                  17,875
   Accrued rental income                                                           1,480,032               1,424,603
                                                                          -------------------     -------------------

                                                                                $ 34,518,383            $ 34,687,493
                                                                          ===================     ===================

                  LIABILITIES AND PARTNERS' CAPITAL

   Accounts payable                                                               $   38,589              $    4,068
   Accrued and escrowed real estate taxes payable                                     13,197                   6,923
   Distributions payable                                                             850,002                 850,002
   Due to related party                                                               20,964                  22,529
   Rents paid in advance and deposits                                                 28,227                  54,568
                                                                          -------------------     -------------------
       Total liabilities                                                             950,979                 938,090

   Commitment (Note 4)

   Partners' capital                                                              33,567,404              33,749,403
                                                                          -------------------     -------------------

                                                                                $ 34,518,383            $ 34,687,493
                                                                          ===================     ===================

</TABLE>
           See accompanying notes to condensed financial statements.




<PAGE>


                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                         CONDENSED STATEMENTS OF INCOME

<TABLE>
<CAPTION>

                                                                                    Quarter Ended
                                                                                      March 31,
                                                                                1999              1998
                                                                           ---------------    --------------
<S> <C>
Revenues:
    Rental income from operating leases                                         $ 596,445         $ 618,515
    Earned income from direct financing leases                                    192,950           217,035
    Contingent rental income                                                       40,605            65,923
    Interest and other income                                                       6,768            20,195
                                                                           ---------------    --------------
                                                                                  836,768           921,668
                                                                           ---------------    --------------

Expenses:
    General operating and administrative                                           41,519            30,094
    Professional services                                                          12,039             8,405
    Management fees to related party                                                8,596             8,953
    Real estate taxes                                                               8,340                --
    State and other taxes                                                          21,476            15,953
    Depreciation and amortization                                                 103,841            98,418
    Transaction costs                                                              33,181                --
                                                                           ---------------    --------------
                                                                                  228,992           161,823
                                                                           ---------------    --------------

Income Before Equity in Earnings of Joint Ventures                                607,776           759,845

Equity in Earnings of Joint Ventures                                               60,227            64,307
                                                                           ---------------    --------------

Net Income                                                                      $ 668,003         $ 824,152
                                                                           ===============    ==============

Allocation of Net Income:
    General partners                                                            $   6,680         $   8,242
    Limited partners                                                              661,323           815,910
                                                                           ---------------    --------------

                                                                                $ 668,003         $ 824,152
                                                                           ===============    ==============

Net Income Per Limited Partner Unit                                              $   0.17          $   0.20
                                                                           ===============    ==============

Weighted Average Number of Limited Partner
    Units Outstanding                                                           4,000,000         4,000,000
                                                                           ===============    ==============

</TABLE>
           See accompanying notes to condensed financial statements.

<PAGE>


                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                    CONDENSED STATEMENTS OF PARTNERS' CAPITAL

<TABLE>
<CAPTION>

                                                                             Quarter Ended           Year Ended
                                                                               March 31,            December 31,
                                                                                  1999                  1998
                                                                           -------------------    ------------------
<S> <C>
General partners:
    Beginning balance                                                             $   163,874            $  137,207
    Net income                                                                          6,680                26,667
                                                                           -------------------    ------------------
                                                                                      170,554               163,874
                                                                           -------------------    ------------------

Limited partners:
    Beginning balance                                                              33,585,529            34,516,349
    Net income                                                                        661,323             2,469,188
    Distributions ($0.21 and $0.85 per
       limited partner unit, respectively)                                           (850,002 )          (3,400,008 )
                                                                           -------------------    ------------------
                                                                                   33,396,850            33,585,529
                                                                           -------------------    ------------------

Total partners' capital                                                          $ 33,567,404          $ 33,749,403
                                                                           ===================    ==================
</TABLE>
           See accompanying notes to condensed financial statements.



<PAGE>


                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                       CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                                  Quarter Ended
                                                                                    March 31,
                                                                              1999              1998
                                                                         ---------------    --------------
<S> <C>
Increase (Decrease) in Cash and Cash Equivalents

    Net Cash Provided by Operating Activities                                 $ 788,735         $ 989,648
                                                                         ---------------    --------------

    Cash Flows from Investing Activities:
       Payment of lease costs                                                   (17,875 )              --
                                                                         ---------------    --------------
              Net cash used in investing activities                             (17,875 )              --
                                                                         ---------------    --------------

    Cash Flows from Financing Activities:
       Distributions to limited partners                                       (850,002 )        (850,002 )
                                                                         ---------------    --------------
              Net cash used in financing activities                            (850,002 )        (850,002 )
                                                                         ---------------    --------------

Net Increase (Decrease) in Cash and Cash Equivalents                            (79,142 )         139,646

Cash and Cash Equivalents at Beginning of Quarter                               766,859           907,980
                                                                         ---------------    --------------

Cash and Cash Equivalents at End of Quarter                                   $ 687,717        $1,047,626
                                                                         ===============    ==============

Supplemental Schedule of Non-Cash Financing
    Activities:

       Distributions declared and unpaid at end of
          quarter                                                             $ 850,002         $ 850,002
                                                                         ===============    ==============


</TABLE>
           See accompanying notes to condensed financial statements.


<PAGE>


                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                     Quarters Ended March 31, 1999 and 1998


1.       Basis of Presentation:

         The accompanying  unaudited  condensed  financial  statements have been
         prepared in accordance  with the  instructions  to Form 10-Q and do not
         include  all  of the  information  and  note  disclosures  required  by
         generally  accepted  accounting  principles.  The financial  statements
         reflect all adjustments,  consisting of normal  recurring  adjustments,
         which are, in the opinion of management,  necessary to a fair statement
         of the results for the interim periods presented. Operating results for
         the quarter ended March 31, 1999,  may not be indicative of the results
         that may be expected for the year ending December 31, 1999.  Amounts as
         of December 31, 1998, included in the financial  statements,  have been
         derived from audited financial statements as of that date.

         These unaudited financial statements should be read in conjunction with
         the financial statements and notes thereto included in Form 10-K of CNL
         Income Fund XIII, Ltd. (the  "Partnership") for the year ended December
         31, 1998.

2.       Concentration of Credit Risk:

         The  following  schedule  presents  total rental and earned income from
         individual  lessees,  each  representing  more than ten  percent of the
         Partnership's   total   rental  and  earned   income   (including   the
         Partnership's  share of total  rental  and  earned  income  from  joint
         ventures and the properties held as  tenants-in-common  with affiliates
         of the general partners) for each of the quarters ended March 31:
<TABLE>
<CAPTION>

                                                                              1999                  1998
                                                                         ---------------       ---------------
<S> <C>
                Flagstar Enterprises, Inc. (and Denny's
                    Inc. and Quincy's Inc. for the
                    quarter ended March 31, 1998                              $ 162,021             $ 186,036
                Golden Corral Corporation                                       130,435               133,150
                Foodmaker, Inc.                                                 113,223               113,418
                Long John Silver's, Inc.                                        105,362               188,672
                Checkers Drive-In Restaurants, Inc.                              91,622                   N/A

</TABLE>


<PAGE>


                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                     Quarters Ended March 31, 1999 and 1998


2.       Concentration of Credit Risk - Continued:

         In addition,  the following  schedule  presents total rental and earned
         income from individual  restaurant chains,  each representing more than
         ten  percent  of the  Partnership's  total  rental  and  earned  income
         (including  the  Partnership's  share of total rental and earned income
         from joint ventures and the properties held as  tenants-in-common  with
         affiliates  of the general  partners)  for each of the  quarters  ended
         March 31:
<TABLE>
<CAPTION>

                                                                              1999                  1998
                                                                         ---------------       ---------------
<S> <C>
                Hardee's                                                      $ 162,021             $ 162,498
                Golden Corral Family Steakhouse
                    Restaurants                                                 130,435               133,150
                Jack in the Box                                                 113,223               113,418
                Long John Silver's                                              105,362               188,672
                Burger King                                                     100,140               120,595
                Checkers Drive-In Restaurants                                    91,622                   N/A
</TABLE>

         The  information   denoted  by  N/A  indicates  that  for  each  period
         presented,  the  tenant or the chain  did not  represent  more than ten
         percent of the Partnership's total rental and earned income.

         Although  the  Partnership's   properties  are  geographically  diverse
         throughout the United States and the  Partnership's  lessees  operate a
         variety of restaurant concepts,  default by any one of these lessees or
         restaurant chains could significantly  impact the results of operations
         of the  Partnership  if the  Partnership  is not able to  re-lease  the
         properties in a timely manner.

         In June  1998,  Long  John  Silver's,  Inc.  filed for  bankruptcy  and
         rejected the leases relating to three of the eight properties it leased
         and ceased  making  rental  payments  to the  Partnership  on the three
         rejected leases.  During 1998, the Partnership  entered into new leases
         for two of the three  properties  with new tenants,  one for which rent
         commenced in December  1998 and one for which rental income is expected
         to commence  subsequent to March 31, 1999,  pending  renovations to the
         property by the  tenant.  In  addition,  in May 1999,  the  Partnership
         re-leased the remaining  rejected  lease  property to a new tenant (See
         Note 5).  While Long John  Silver's,  Inc. has not rejected or affirmed
         the remaining  five leases,  there can be no assurance that some or all
         of the leases will not be rejected  in the  future.  The lost  revenues
         resulting  from the  possible  rejection of the  remaining  five leases
         could  have an  adverse  effect on the  results  of  operations  of the
         Partnership if the Partnership is not able to re-lease these properties
         in a timely manner.


<PAGE>


                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                     Quarters Ended March 31, 1999 and 1998


3.       Merger Transaction:

         On March 11, 1999, the  Partnership  entered into an Agreement and Plan
         of Merger with CNL American Properties Fund, Inc. ("APF"),  pursuant to
         which the Partnership would be merged with and into a subsidiary of APF
         (the  "Merger").  As  consideration  for the Merger,  APF has agreed to
         issue 3,886,185  shares of its common stock,  par value $0.01 per share
         (the "APF  Shares")  which,  for the  purposes  of  valuing  the merger
         consideration,  have been  valued by APF at $10.00 per APF  Share,  the
         price paid by APF investors in three  previous  public  offerings,  the
         most recent of which was completed in December 1998. In order to assist
         the general  partners in evaluating the proposed merger  consideration,
         the  general  partners  retained  Valuation  Associates,  a  nationally
         recognized real estate  appraisal  firm, to appraise the  Partnership's
         restaurant   property   portfolio.   Based  on  Valuation   Associates'
         appraisal,  the Partnership's  property portfolio and other assets were
         valued on a going  concern  basis  (meaning the  Partnership  continues
         unchanged)  at  $38,283,180  as of December 31,  1998.  Legg Mason Wood
         Walker, Incorporated has rendered a fairness opinion that the APF Share
         consideration,  payable  by  APF,  is fair  to the  Partnership  from a
         financial  point of view.  The APF Shares are expected to be listed for
         trading  on  the  New  York  Stock  Exchange   concurrently   with  the
         consummation of the Merger, and, therefore, would be freely tradable at
         the option of the former limited partners.  At a special meeting of the
         partners  that is  expected  to be held in the third  quarter  of 1999,
         limited  partners  holding  in  excess  of  50%  of  the  Partnership's
         outstanding limited partnership interests must approve the Merger prior
         to  consummation  of the  transaction.  If the limited  partners at the
         special  meeting  approve the Merger,  APF will own the  Properties and
         other  assets  of the  Partnership.  The  general  partners  intend  to
         recommend  that the  limited  partners of the  Partnership  approve the
         Merger. In connection with their  recommendation,  the general partners
         will  solicit  the  consent  of the  limited  partners  at the  special
         meeting.  If the limited  partners  reject the Merger,  the Partnership
         will  bear  the  portion  of  the  transaction  costs  based  upon  the
         percentage  of "For"  votes  and the  general  partners  will  bear the
         portion  of  such  transaction  costs  based  upon  the  percentage  of
         "Against" votes and abstentions.

         On May 5,  1999,  four  limited  partners  in several of the CNL Income
         Funds  filed  a  lawsuit  against  the  general  partners  and  APF  in
         connection  with  the  proposed  Merger  (see  Part II - Item 1.  Legal
         Proceedings).  The general partners and APF believe that the lawsuit is
         without  merit and  intend to defend  vigorously  against  the  claims.
         Because the lawsuit was so recently  filed,  it is premature to further
         comment on the lawsuit at this time.


<PAGE>


                           CNL INCOME FUND XIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                     Quarters Ended March 31, 1999 and 1998


4.       Commitment:

         In November  1998,  the  Partnership  entered  into a new lease for the
         property in Tampa,  Florida,  with a new tenant to operate the property
         as a Steak-N-Shake restaurant. In connection therewith, the Partnership
         agreed to pay up to $600,000  in  renovation  costs,  none of which had
         been incurred as of March 31, 1999.

5.       Subsequent Event:

         In May 1999, the Partnership  entered into a new lease for the property
         in  Philadelphia,  Pennsylvania,  with  a new  tenant  to  operate  the
         property  as  an  Arby's  restaurant.   In  connection  therewith,  the
         Partnership agreed to pay up to $975,000 in renovation costs.


<PAGE>


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

         CNL Income Fund XIII,  Ltd. (the  "Partnership")  is a Florida  limited
partnership  that was  organized  on September  25,  1992,  to acquire for cash,
either directly or through joint venture  arrangements,  both newly  constructed
and existing  restaurants,  as well as properties upon which restaurants were to
be constructed  (the  "Properties"),  which are leased primarily to operators of
national and regional  fast-food and family-style  restaurant chains. The leases
are generally triple-net leases, with the lessees generally  responsible for all
repairs and maintenance,  property taxes,  insurance and utilities.  As of March
31, 1999, the Partnership owned 47 Properties,  which included  interests in two
Properties owned by joint ventures in which the Partnership is a co-venturer and
three Properties owned with affiliates as tenants-in-common.

Liquidity and Capital Resources

         The  Partnership's  primary  source of capital for the  quarters  ended
March 31, 1999 and 1998, was cash from operations  (which includes cash received
from tenants,  distributions from joint ventures,  and interest and other income
received,  less cash paid for expenses).  Cash from  operations was $788,735 and
$989,648  for the  quarters  ended  March 31, 1999 and 1998,  respectively.  The
decrease in cash from  operations  for the  quarter  ended  March 31,  1999,  as
compared to the quarter  ended March 31, 1998,  is primarily a result of changes
in the  Partnership's  working  capital  and  changes in income and  expenses as
described in "Results of Operations" below.

         Currently,  rental income from the Partnership's Properties is invested
in money market accounts or other short-term,  highly liquid investments pending
the  Partnership's  use of such  funds to pay  Partnership  expenses  or to make
distributions  to the partners.  At March 31, 1999, the Partnership had $687,717
invested in such short-term investments, as compared to $766,859 at December 31,
1998.  The funds  remaining at March 31, 1999 will be used to pay  distributions
and other liabilities.

         Total liabilities of the Partnership,  including distributions payable,
increased  to $950,979 at March 31,  1999,  from  $938,090 at December 31, 1998.
Liabilities  at  March  31,  1999,  to the  extent  they  exceed  cash  and cash
equivalents at March 31, 1999, will be paid from future cash from operations, or
in the event the general partners elect to make capital  contributions or loans,
from future general partner contributions or loans.

         In November  1998,  the  Partnership  entered  into a new lease for the
Property located in Tampa, Florida, with a new tenant to operate the Property as
a Steak-N-Shake  restaurant. In connection therewith, the Partnership has agreed
to fund up to $600,000 in conversion  costs  associated  with this Property.  No
amounts have been  incurred as of March 31, 1999. In May 1999,  the  Partnership
entered into a new lease for the property in Philadelphia,  Pennsylvania, with a
new  tenant to operate  the  property  as an Arby's  restaurant.  In  connection
therewith, the Partnership agreed to pay up to $975,000 in renovation costs. The
Partnership   anticipates  funding  these  renovation  costs  by  entering  into
arrangements with affiliates of the general partners or third parties. Under the
arrangements,  the  affiliates  of the general  partners or third  parties would
contribute  the  proceeds  to pay for  the  renovation  costs  in  exchange  for
interests in the properties. As of May 13, 1999, the Partnership has not entered
into any such arrangements.


<PAGE>


Liquidity and Capital Resources - Continued

         Based  primarily  on cash from  operations,  and for the quarter  ended
March 31,  1999,  anticipated  future  cash  from  operations,  the  Partnership
declared  distributions  to the limited  partners  of  $850,002  for each of the
quarters ended March 31, 1999 and 1998. This represents  distributions  of $0.21
per unit for each applicable  quarter. No distributions were made to the general
partners for the quarters ended March 31, 1999 and 1998. No amounts  distributed
to the limited  partners  for the  quarters  ended March 31, 1999 and 1998,  are
required to be or have been  treated by the  Partnership  as a return of capital
for  purposes of  calculating  the limited  partners'  return on their  adjusted
capital contributions. The Partnership intends to continue to make distributions
of cash available for distribution to the limited partners on a quarterly basis.

         The Partnership's  investment strategy of acquiring Properties for cash
and  leasing  them  under  triple-net  leases to  operators  who meet  specified
financial standards minimizes the Partnership's  operating expenses. The general
partners  believe that the leases will  continue to generate cash flow in excess
of operating expenses.

         The general  partners have the right,  but not the obligation,  to make
additional capital  contributions if they deem it appropriate in connection with
the operations of the Partnership.

         On March 11, 1999, the  Partnership  entered into an Agreement and Plan
of Merger with APF,  pursuant to which the Partnership  would be merged with and
into a subsidiary of APF (the "Merger").  APF is a real estate  investment trust
whose primary  business is the ownership of  restaurant  properties  leased on a
long-term,  "triple-net" basis to operators of national and regional  restaurant
chains.  APF has agreed to issue shares of its common stock, par value $0.01 per
share (the "APF Shares"),  as  consideration  for the Merger.  APF has agreed to
issue  3,886,185  APF Shares  which,  for the  purposes  of  valuing  the merger
consideration,  have been valued by APF at $10.00 per APF Share,  the price paid
by APF investors in three previous  public  offerings,  the most recent of which
was  completed  in December  1998.  In order to assist the  general  partners in
evaluating the proposed  merger  consideration,  the general  partners  retained
Valuation  Associates,  a nationally  recognized real estate  appraisal firm, to
appraise the Partnership's  restaurant  property  portfolio.  Based on Valuation
Associates'  appraisal,  the Partnership's  property  portfolio and other assets
were  valued  on a  going  concern  basis  (meaning  the  Partnership  continues
unchanged)  at  $38,283,180  as of December  31,  1998.  Legg Mason Wood Walker,
Incorporated has rendered a fairness  opinion that the APF Share  consideration,
payable by APF, is fair to the  Partnership  from a financial point of view. The
APF Shares are expected to be listed for trading on the New York Stock  Exchange
concurrently with the consummation of the Merger, and therefore, would be freely
tradable at the option of the former limited  partners.  At a special meeting of
the partners that is expected to be held in the third  quarter of 1999,  limited
partners  holding  in excess  of 50% of the  Partnership's  outstanding  limited
partnership  interests  must  approve the Merger  prior to  consummation  of the
transaction.  If the limited partners at the special meeting approve the Merger,
APF will own the  Properties  and other assets of the  Partnership.  The general
partners  intend to  recommend  that the  limited  partners  of the  Partnership
approve  the  Merger.  In  connection  with their  recommendation,  the  general
partners  will  solicit  the  consent of the  limited  partners  at the  special
meeting.  If the limited  partners reject the Merger,  the Partnership will bear
the portion of the  transaction  costs based upon the  percentage of "For" votes
and the general partners will bear the portion of such  transaction  costs based
upon the percentage of "Against" votes and abstentions.


<PAGE>


Liquidity and Capital Resources - Continued

         On May 5,  1999,  four  limited  partners  in several of the CNL Income
Funds filed a lawsuit  against the general  partners and APF in connection  with
the  proposed  Merger  (see Part II - Item 1. Legal  Proceedings).  The  general
partners and APF believe that the lawsuit is without  merit and intend to defend
vigorously against the claims.  Because the lawsuit was so recently filed, it is
premature to further comment on the lawsuit at this time.

Results of Operations

         During  each of the  quarters  ended  March  31,  1999  and  1998,  the
Partnership  owned  and  leased 42  wholly  owned  Properties  to  operators  of
fast-food and family-style  restaurant chains. In connection  therewith,  during
the quarters ended March 31, 1999 and 1998, the Partnership  earned $789,395 and
$835,550, respectively, in rental income from operating leases and earned income
from direct financing leases from these  Properties.  The decrease in rental and
earned  income is due to the fact that in June 1998,  Long John  Silver's,  Inc.
filed for  bankruptcy  and  rejected  the leases  relating to three of the eight
Properties  it leased and ceased making  rental  payments on the three  rejected
leases. The Partnership has continued to receive rental payments relating to the
leases not rejected by the tenant. During 1998, the Partnership re-leased two of
these Properties to new tenants.  Rental payments commenced in December 1998 for
one lease and rental  payments  on the other  lease are  scheduled  to  commence
during the second  quarter of 1999. In addition,  in May 1999,  the  Partnership
released the remaining vacant Property to a new tenant, to renovate the Property
into an  Arby's  restaurant,  as  described  above  in  "Liquidity  and  Capital
Resources."  While Long John  Silver's,  Inc.  has not  rejected or affirmed the
remaining five leases,  there can be no assurance that some or all of the leases
will not be  rejected  in the  future.  The  lost  revenues  resulting  from the
possible  rejection of the remaining five leases could have an adverse effect on
the results of operations of the  Partnership if the  Partnership is not able to
re-lease these Properties in a timely manner.

         During the quarter ended March 31, 1999 and 1998, the Partnership  also
earned  $40,605 and $65,923,  respectively,  in contingent  rental  income.  The
decrease in contingent rental income during the quarter ended March 31, 1999, as
compared to the quarter ended March 31, 1998, is primarily  attributable  to the
fact that during the quarter  ended March 31,  1998,  the  Partnership  recorded
additional  contingent  rental  amounts  as  a  result  of  adjusting  estimated
contingent rental amounts accrued at December 31, 1997, to actual amounts.

         During the quarters ended March 31, 1999 and 1998, the Partnership also
owned and leased two Properties  indirectly  through joint venture  arrangements
and   three   Properties   with   affiliates   of  the   general   partners   as
tenants-in-common.  In connection therewith, during the quarters ended March 31,
1999 and  1998,  the  Partnership  earned  $60,227  and  $64,307,  respectively,
attributable to the net income earned by these joint ventures.

         During the quarter  ended  March 31,  1999,  five of the  Partnership's
lessees,  Flagstar  Enterprises,  Inc., Long John Silver's,  Inc., Golden Corral
Corporation, Checkers Drive-In Restaurants, and Foodmaker, Inc. each contributed
more than ten percent of the  Partnership's  total rental income  (including the
Partnership's share of rental income from Properties owned by joint ventures and
Properties owned with affiliates of the general partners as  tenants-in-common).
As of March 31,  1999,  Flagstar  Enterprises,  Inc. was the lessee under leases
relating to 11 restaurants, Long John Silver's, Inc. was the lessee under leases
relating to five restaurants

<PAGE>


Results of Operations - Continued

(which  excludes the one vacant  restaurant for which Long John  Silver's,  Inc.
rejected the lease as a result of filing for  bankruptcy,  as described  above),
Golden  Corral  Corporation  was the  lessee  under  leases  relating  to  three
restaurants,  Checkers Drive-In Restaurants was the lessee under leases relating
to eight restaurants,  and Foodmaker,  inc. was the lessee under leases relating
to five  restaurants.  As a  result  of  Long  John  Silver's  Inc.  filing  for
bankruptcy in June 1998, as described above, it is anticipated that based on the
minimum rental  payments  required by the leases,  Flagstar  Enterprises,  Inc.,
Golden Corral Corporation,  Checkers Drive-In Restaurants,  and Foodmaker,  Inc.
each will  continue to  contribute  more than ten  percent of the  Partnership's
total rental and earned income. In addition,  during the quarter ended March 31,
1999, six restaurant chains, Long John Silver's,  Hardee's,  Golden Corral, Jack
in the Box, Checkers,  and Burger King, each accounted for more than ten percent
of the Partnership's  total rental income (including the Partnership's  share of
rental income from Properties  owned by joint ventures and Properties owned with
affiliates  as  tenants-in-common).  It is  anticipated  that  Hardee's,  Golden
Corral,  Jack in the Box,  Checkers,  and Burger  King,  each will  continue  to
account for more than ten percent of the total rental  income under the terms of
its leases.  Any failure of these lessees or restaurant  chains could materially
affect the  Partnership's  income if the Partnership is not able to re-lease the
Properties in a timely manner.

         Operating expenses,  including  depreciation and amortization  expense,
were  $228,992  and  $161,823  for the  quarters  ended March 31, 1999 and 1998,
respectively.  The increase in operating expenses during the quarter ended March
31,  1999,  as compared  to the  quarter  ended  March 31,  1998,  is  partially
attributable  to an increase  in  insurance  and real  estate tax  expenses as a
result of Long John  Silver's,  Inc.  filing for  bankruptcy  and  rejecting the
leases  relating to three  Properties in June 1998, as described  above.  During
1998, the Partnership entered into two leases, each with a new tenant for two of
the three  vacant  Properties,  to  operate  the  Properties  as a Lions  Choice
restaurant  and a  Steak-N-Shake  restaurant.  In  addition,  in May  1999,  the
Partnership  re-leased  the  remaining  Property to a new tenant to renovate the
Property into an Arby's restaurant, as described above in "Liquidity and Capital
Resources." In accordance with the lease agreement,  the new tenant of the Lions
Choice  Property  became  responsible  for  real  estate  taxes,  insurance  and
maintenance relating to this Property during 1998. The Partnership will continue
to incur these  expenses  relating  to the  Properties  that are  expected to be
converted  into a  Steak-N-Shake  and an Arby's,  until the  conversion  of each
Property is completed,  at which point each tenant will be responsible for these
expenses under the terms of their individual  leases.  The Partnership will also
incur  additional  insurance  and real estate tax expenses if one or more of the
leases relating to the five Properties still leased by Long John Silver's,  Inc.
are rejected.  In addition,  the increase in operating expenses is partially due
to an increase in  depreciation  expense due to the fact that during  1998,  the
Partnership  reclassified  these assets from net investment in direct  financing
leases to land and building on operating leases.

         In  addition,  the increase in  operating  expenses  during the quarter
ended March 31, 1999, is partially due to the fact that the Partnership incurred
$33,181 in transaction costs related to the general partners retaining financial
and legal  advisors to assist them in evaluating  and  negotiating  the proposed
Merger with APF, as described above in "Liquidity and Capital Resources." If the
limited partners reject the Merger, the Partnership will bear the portion of the
transaction  costs  based upon the  percentage  of "For"  votes and the  general
partners  will  bear  the  portion  of such  transaction  costs  based  upon the
percentage of "Against" votes and abstentions.



<PAGE>


Year 2000 Readiness Disclosure

         The Year  2000  problem  concerns  the  inability  of  information  and
non-information  technology  systems to  properly  recognize  and  process  date
sensitive  information beyond January 1, 2000. The Partnership does not have any
information or  non-information  technology  systems.  The general  partners and
affiliates  of the general  partners  provide all services  requiring the use of
information  and  non-information  technology  systems  pursuant to a management
agreement  with  the  Partnership.  The  information  technology  system  of the
affiliates of the general partners  consists of a network of personal  computers
and servers built using  hardware and software from  mainstream  suppliers.  The
non-information technology systems of the affiliates of the general partners are
primarily  facility related and include building  security  systems,  elevators,
fire suppressions,  HVAC, electrical systems and other utilities. The affiliates
of the general partners have no internally  generated programmed software coding
to correct,  because  substantially  all of the software utilized by the general
partners and  affiliates is purchased or licensed from external  providers.  The
maintenance  of   non-information   technology   systems  at  the  Partnership's
Properties is the  responsibility of the tenants of the Properties in accordance
with the terms of the Partnership's leases.

         In early 1998, the general  partners and affiliates  formed a Year 2000
committee  (the "Y2K Team") for the purpose of  identifying,  understanding  and
addressing the various  issues  associated  with the Year 2000 problem.  The Y2K
Team  consists of the general  partners and members from the  affiliates  of the
general partners, including representatives from senior management,  information
systems,  telecommunications,  legal, office management, accounting and property
management. The Y2K Team's initial step in assessing the Partnership's Year 2000
readiness  consists of  identifying  any systems  that are  date-sensitive  and,
accordingly,  could have potential  Year 2000  problems.  The Y2K Team is in the
process of conducting inspections, interviews and tests to identify which of the
Partnership's systems could have a potential Year 2000 problem.

         The  information  system of the  affiliates of the general  partners is
comprised of hardware  and  software  applications  from  mainstream  suppliers.
Accordingly, the Y2K Team is in the process of contacting the respective vendors
and  manufacturers  to verify the Year 2000  compliance  of their  products.  In
addition,  the Y2K Team has also requested and is evaluating  documentation from
other   companies  with  which  the  Partnership  has  a  material  third  party
relationship,   including  the   Partnership's   tenants,   vendors,   financial
institutions and the  Partnership's  transfer agent. The Partnership  depends on
its  tenants  for  rents  and  cash  flows,   its  financial   institutions  for
availability  of cash and its  transfer  agent to  maintain  and track  investor
information.  The Y2K Team has also  requested and is  evaluating  documentation
from the  non-information  technology systems providers of the affiliates of the
general  partners.  Although the general  partners  continue to receive positive
responses  from the  Companies  with  which  the  Partnership  has  third  party
relationships regarding their Year 2000 compliance,  the general partners cannot
be assured that the  tenants,  financial  institutions,  transfer  agent,  other
vendors and system  providers have adequately  considered the impact of the Year
2000. The general  partners are not able to measure the effect on the operations
of the Partnership of any third party's failure to adequately address the impact
of the Year 2000.



<PAGE>


Year 2000 Readiness Disclosure - Continued

         The general  partners and their  affiliates  have  identified  and have
implemented  upgrades for certain hardware equipment.  In addition,  the general
partners and their  affiliates have  identified  certain  software  applications
which will require upgrades to become Year 2000 compliant.  The general partners
expect all of these upgrades,  as well as any other necessary  remedial measures
on the  information  technology  systems  used in the  business  activities  and
operations of the Partnership,  to be completed by September 30, 1999, although,
the general  partners cannot be assured that the upgrade  solutions  provided by
the vendors have addressed all possible Year 2000 issues.  The general  partners
do not  expect  the  aggregate  cost of the Year 2000  remedial  measures  to be
material to the results of operations of the Partnership.

         The general  partners and affiliates have received  certification  from
the  Partnership's  transfer  agent  of its  Year  2000  compliance.  Due to the
material  relationship of the Partnership  with its transfer agent, the Y2K Team
is evaluating the Year 2000  compliance of the systems of the transfer agent and
expects to have the  evaluation  completed  by September  30, 1999.  Despite the
positive  response  from the transfer  agent and the  evaluation of the transfer
agent's system by the Y2K Team, the general  partners cannot be assured that the
transfer  agent has addressed  all possible Year 2000 issues.  In the event that
the  systems of the  transfer  agent are not Year 2000  compliant,  the  general
partners and their  affiliates  would have to allocate  resources to  internally
perform  the  functions  of the  transfer  agent.  The  general  partners do not
anticipate  that the additional  cost of these  resources  would have a material
impact on the Partnership.

         Based upon the progress the general  partners and affiliates  have made
in  addressing  the Year 2000 issues and their plan and timeline to complete the
compliance  program,  the  general  partners do not  foresee  significant  risks
associated  with Year 2000  compliance  at this time.  The general  partners and
their affiliates plan to address their significant Year 2000 issues prior to the
Partnership  being  affected  by them;  therefore,  they  have not  developed  a
comprehensive  contingency  plan.  However,  if the general  partners  and their
affiliates identify significant risks related to their Year 2000 compliance,  or
if their progress deviates from the anticipated  timeline,  the general partners
and their affiliates will develop  contingency plans as deemed necessary at that
time.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
                  RISK.

         Not applicable.


<PAGE>


                           PART II. OTHER INFORMATION


Item 1.    Legal Proceedings.

           On May 5, 1999,  four  limited  partners in several of the CNL
           Income  Funds  filed a  lawsuit,  Jon  Hale,  Mary J.  Hewitt,
           Charles A. Hewitt,  and Gretchen M. Hewitt v. James M. Seneff,
           Jr.,  Robert  A.  Bourne,  CNL  Realty  Corporation,  and  CNL
           American  Properties Fund, Inc., Case No.  CIO-99-0003561,  in
           the  Circuit  Court of the Ninth  Judicial  Circuit  of Orange
           County,  Florida,  alleging that the Messrs. Seneff and Bourne
           and CNL Realty  Corporation,  as general  partners  of the CNL
           Income Funds, breached their fiduciary duties and violated the
           provisions  of  certain  of the CNL  Income  Fund  partnership
           agreements in connection with the proposed  acquisition of the
           CNL  Income   Funds  by  APF.  The   plaintiffs   are  seeking
           unspecified damages and equitable relief. The general partners
           and APF believe  that the lawsuit is without  merit and intend
           to defend vigorously against such claims.  Because the lawsuit
           was so recently  filed,  it is premature to further comment on
           the lawsuit at this time.

Item 2.    Changes in Securities.       Inapplicable.

Item 3.    Default upon Senior Securities.   Inapplicable.

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

Item 5.    Other Information.        Inapplicable.

Item 6.    Exhibits and Reports on Form 8-K.

               (a)      Exhibits

                     2.1        Agreement  and Plan of Merger by and between the
                                Registrant  and CNL  American  Properties  Fund,
                                Inc.  ("APF")  dated  March 11,  1999  (filed as
                                Appendix B to the Prospectus  Supplement for the
                                Registrant,   constituting   a   part   of   the
                                Registration  Statement of APF on Form S-4, File
                                No. 74329.)

                     3.1        Affidavit and Certificate of Limited Partnership
                                of CNL  Income  Fund  XIII,  Ltd.  (Included  as
                                Exhibit  3.1  to   Registration   Statement  No.
                                33-53672 on Form S-11 and incorporated herein by
                                reference.)

                     4.1        Affidavit and Certificate of Limited Partnership
                                of CNL  Income  Fund  XIII,  Ltd.  (Included  as
                                Exhibit  3.1  to   Registration   Statement  No.
                                33-53672 on Form S-11 and incorporated herein by
                                reference.)

                     4.2        Amended  and   Restated   Agreement  of  Limited
                                Partnership  of  CNL  Income  Fund  XIII,   Ltd.
                                (Included as Exhibit 4.2 to Form 10-K filed with
                                the Securities and Exchange  Commission on March
                                31, 1994, and incorporated herein by reference.)


<PAGE>



                     10.1       Management  Agreement  between  CNL Income  Fund
                                XIII, Ltd. and CNL Investment  Company (Included
                                as  Exhibit  10.1 to Form  10-K  filed  with the
                                Securities and Exchange  Commission on March 31,
                                1994, and incorporated herein by reference.)

                     10.2       Assignment  of  Management  Agreement  from  CNL
                                Investment  Company to CNL Income Fund Advisors,
                                Inc.  (Included  as  Exhibit  10.2 to Form  10-K
                                filed   with   the   Securities   and   Exchange
                                Commission on March 30, 1995,  and  incorporated
                                herein by reference.)

                     10.3       Assignment  of  Management  Agreement  from  CNL
                                Income Fund Advisors, Inc. to CNL Fund Advisors,
                                Inc.  (Included  as  Exhibit  10.5 to Form  10-K
                                filed   with   the   Securities   and   Exchange
                                Commission  on April 1, 1996,  and  incorporated
                                herein by reference.)

                     27         Financial Data Schedule (Filed herewith.)

               (b)      Reports on Form 8-K

                           Current  Report on Form 8-K dated  March 11, 1999 and
                           filed March 12, 1999,  describing the proposed merger
                           of the Partnership  with and into a subsidiary of CNL
                           American Properties Fund, Inc.



<PAGE>



                                   SIGNATURES


         Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended,  the  registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

         DATED this 14th day of May, 1999.


                   By:       CNL INCOME FUND XIII, LTD.
                             General Partner


                            By:  /s/ James M. Seneff, Jr.
                                 ----------------------------------------
                                 JAMES M. SENEFF, JR.
                                 Chief Executive Officer
                                 (Principal Executive Officer)


                            By:  /s/ Robert A. Bourne
                                 ----------------------------------------
                                 ROBERT A. BOURNE
                                 President and Treasurer
                                 (Principal Financial and
                                  Accounting Officer)