COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)


                              FINANCIAL STATEMENTS


                     YEARS ENDED DECEMBER 31, 2005 and 2004



























<PAGE>

                          INDEPENDENT AUDITOR'S REPORT



To the Partners
Colonial Village Roseville
(A California Limited Partnership)
Roseville, California




I have audited the accompanying  balance sheets of Colonial Village Roseville (A
California  Limited  Partnership),  as of December  31,  2005 and 2004,  and the
related  statements of income,  changes in partners capital,  and cash flows for
the years then ended.  These financial  statements are the responsibility of the
Partnership's  management.  My  responsibility is to express an opinion on these
financial statements based on my audits.

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

In my opinion, the financial statements referred to above present fairly, in all
material  respects,  the  financial  position of Colonial  Village  Roseville (A
California  Limited  Partnership)  as of  December  31,  2005 and 2004,  and the
results  of its  operations  and its cash  flows  for the  years  then  ended in
conformity with accounting principles generally accepted in the United States of
America.



/S/ Bernard E. Rea, CPA

Stockton, California
February 23, 2006





                                       1
<PAGE>


                                 C O N T E N T S




                                                                            Page
INDEPENDENT AUDITOR'S REPORT ON
     THE FINANCIAL STATEMENTS..................................................1


FINANCIAL STATEMENTS

     Balance sheets..........................................................2-3
     Statements of income....................................................4-7
     Statements of changes in partners capital.................................8
     Statements of cash flows...............................................9-10
     Notes to financial statements.........................................11-14







<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                                 BALANCE SHEETS
                           December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                ASSETS                                                2005                    2004
                                                                                ---------------         ----------------
<S>                                                                            <C>                     <C>
CURRENT ASSETS
   Cash                                                                         $      113,220          $      133,309
   Rents receivable                                                                        - -                     - -
   Other receivables                                                                       - -                     - -
   Prepaid expense                                                                       4,553                   4,429
                                                                                ----------------        ---------------
            Total current assets                                                $      117,773          $      137,738
                                                                                ----------------        ---------------
RESTRICTED DEPOSITS AND FUNDED RESERVES
   Tenants' security deposits                                                   $       29,843          $       29,053
   Replacement reserve escrow                                                          124,505                 104,904
                                                                                ----------------        ---------------
                                                                                $      154,348          $      133,957
                                                                                ----------------        ---------------
PROPERTY AND EQUIPMENT, AT COST
   Land                                                                         $      315,303          $      315,303
   Building                                                                          4,865,200               4,861,210
   Equipment                                                                           177,478                 177,478
                                                                                ----------------        ---------------
                                                                                $    5,357,981          $    5,353,991
   Less accumulated depreciation                                                     2,084,508               1,905,710
                                                                                ----------------        ---------------
                                                                                $    3,273,473          $    3,448,281
                                                                                ----------------        ---------------
OTHER ASSETS
  Deferred charges, less accumulated
    amortization of $54,940 and $49,727                                         $       78,482          $       83,695
                                                                                ----------------        ----------------
                                                                                $       78,482          $       83,695
                                                                                ----------------        ----------------
                                                                                $    3,624,076          $    3,803,671
                                                                                ================        ================
</TABLE>
                       See Notes to Financial Statements.
                                       2
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                                 BALANCE SHEETS
                           December 31, 2005 and 2004
<TABLE>
<CAPTION>
                           LIABILITIES AND PARTNERS CAPITAL                 2005                             2004
                                                                       ---------------                 ---------------
<S>                                                                   <C>                             <C>
CURRENT LIABILITIES
   Current maturities of long-term debt                                $       47,524                  $       40,297
   Accounts payable                                                             3,897                           4,732
   Accounts payable - general partner                                          10,388                          10,722
   Accrued expense                                                                800                             800
   Accrued interest                                                               - -                             - -
                                                                      ----------------                 ---------------
                            Total current liabilities                  $       62,609                  $       56,551
                                                                      ----------------                 ---------------
DEPOSIT AND PREPAYMENT LIABILITIES
   Tenants' security deposits                                          $       23,550                  $       23,600
   Prepaid rents                                                                  - -                             - -
                                                                      ----------------                ----------------
                                                                       $       23,550                  $       23,600
                                                                      ----------------                ----------------
LONG-TERM DEBT
  Mortgage payable, less current maturities                            $    1,850,192                  $    1,899,408
                                                                      ----------------                ----------------
                                                                       $    1,850,192                  $    1,899,408
                                                                      ----------------                ----------------
COMMITMENT

PARTNERS CAPITAL                                                       $    1,687,725                  $    1,824,112
                                                                      ----------------                ----------------
                                                                       $    3,624,076                  $    3,803,671
                                                                      ================                ================
</TABLE>
                       See Notes to Financial Statements.
                                       3
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                              STATEMENTS OF INCOME
                     Years Ended December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                             2005                          2004
                                                                       --------------                ---------------
<S>                                                                   <C>                           <C>
RENTAL INCOME
  Apartments                                                           $      541,423                $      545,210
  Tenant assistance payments                                                      - -                           - -
  Subsidy income                                                                  - -                           - -
  Miscellaneous                                                                   - -                           - -
                                                                       --------------                ---------------
        Net rental revenue                                             $      541,423                $      545,210
                                                                       --------------                ---------------
FINANCIAL REVENUE
  Interest Income - project operations                                 $          - -                $          - -
  Income from investments - replacement reserve                                 3,798                         2,464
  Income from investments - operating reserve                                     315                           183
  Income from investments - miscellaneous                                         - -                           - -
                                                                       --------------                ---------------
    Sub-total financial revenue                                        $        4,113                $        2,647
                                                                       --------------                ---------------

OTHER REVENUE
  Laundry and vending                                                  $       11,352                $        5,276
  NSF and late charges                                                            225                           775
  Damage and cleaning fees                                                      2,044                         5,882
  Forfeited tenant security deposits                                              - -                           - -
  Other revenue                                                                   - -                           205
                                                                       --------------                ---------------
    Sub-total other revenue                                            $       13,621                $       12,138
                                                                       --------------                ---------------
         Total revenues                                                $      559,157                $      559,995
                                                                       ==============                ================
</TABLE>
                       See Notes to Financial Statements.
                                       4
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                        STATEMENTS OF INCOME (CONTINUED)
                     Years Ended December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                                         2005                         2004
                                                                                    --------------              ----------------
<S>                                                                                <C>                         <C>
OPERATING EXPENSES

   Renting expenses
     Advertising                                                                    $        1,599              $          617
     Miscellaneous renting expenses                                                            - -                          22
                                                                                    --------------              ----------------
        Sub-total renting expenses                                                  $        1,599              $          639
                                                                                    --------------              ----------------
   Administrative expenses
     Office salaries                                                                $          - -              $          - -
     Office supplies                                                                           869                         408
     Office rent                                                                               - -                         - -
     Management fee                                                                         34,944                      33,600
     Manager's salary                                                                       22,657                      20,673
     Manager rent free unit                                                                 11,316                      11,250
     Legal expense                                                                           1,168                       1,082
     Audit expense                                                                           6,125                       5,850
     Bookkeeping / accounting services                                                         - -                         - -
     Telephone and answering service                                                         1,442                       1,271
     Bad debts                                                                               5,531                       4,121
     Miscellaneous administrative expenses                                                   9,487                      11,232
                                                                                    --------------              ----------------
       Sub-total administrative expenses                                            $       93,539              $       89,487
                                                                                    --------------              ----------------
   Utilities expense
     Fuel oil / coal                                                                $         - -               $          - -
     Electricity                                                                            4,927                        4,853
     Water                                                                                  3,833                        4,550
     Gas                                                                                    3,922                        4,208
     Sewer                                                                                  8,090                        7,665
                                                                                    --------------              ----------------
       Sub-total utilities expense                                                  $      20,772               $       21,276
                                                                                    --------------              ----------------
</TABLE>
See Notes to Financial Statements.
                                       5
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                        STATEMENTS OF INCOME (CONTINUED)
                     Years Ended December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                                   2005                         2004
                                                                             ---------------              ---------------
<S>                                                                         <C>                          <C>
              Operating and maintenance expense
                 Janitor and cleaning payroll                                $        5,306               $        5,973
                 Janitor and cleaning supplies                                          772                          543
                 Janitor and cleaning contract                                        1,805                        1,105
                 Exterminating payroll / contract                                       924                          682
                 Exterminating supplies                                                 - -                          - -
                 Garbage and trash removal                                            7,608                        7,304
                 Security payroll / contract                                            - -                          - -
                 Grounds payroll                                                        - -                          - -
                 Grounds supplies                                                       257                          121
                 Grounds contract                                                    12,945                        9,579
                 Repairs payroll                                                     24,182                       22,196
                 Repairs material                                                     2,211                        1,435
                 Repairs contract                                                    29,131                       19,582
                 Elevator maintenance / contract                                        - -                          - -
                 Heating / cooling repairs and maintenance                              - -                          - -
                 Swim pool maintenance / contract                                       - -                          - -
                 Snow removal                                                           - -                          - -
                 Decorating payroll / contract                                          350                          752
                 Decorating supplies                                                    581                        3,190
                 Vehicle and maintenance equipment o & r                                - -                          - -
                 Miscellaneous operating and maint. expenses                          5,698                        4,474
                                                                             --------------               ---------------
                   Sub-total operating & maint. expense                      $       91,770               $       76,936
                                                                             --------------               ---------------
              Taxes and insurance
                 Real estate taxes                                           $          850               $          566
                 Payroll taxes                                                        4,896                        4,728
                 Miscellaneous taxes, licenses, and permits                             800                          800
                 Property and liability insurance                                     7,664                        6,860
                 Fidelity bond insurance                                                - -                          - -
                 Workman's compensation                                              13,766                       14,959
                 Health insurance and other employee benefits                         9,968                        9,581
                 Other insurance                                                        - -                          - -
                                                                             ---------------              ---------------
                   Sub-total taxes & insurance                               $       37,944               $       37,494
                                                                             ---------------              ---------------


                       Total operating expenses                              $      245,624               $      225,832
                                                                             ---------------              ---------------

</TABLE>
                       See Notes to Financial Statements.
                                       6
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                        STATEMENTS OF INCOME (CONTINUED)
                     Years Ended December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                                     2005                        2004
                                                                                ----------------         -------------------
<S>                                                                              <C>                    <C>
OTHER EXPENSES
  Interest expense - mortgage                                                     $      141,152         $          150,344
  Interest expense - notes                                                                   - -                        - -
  Miscellaneous financial expense                                                            - -                        - -
  Depreciation and amortization                                                          184,011                    183,114
  Non project expenses                                                                       - -                        - -
                                                                                -----------------        -------------------
    Sub-total other expenses                                                      $      325,163         $          333,458
                                                                                -----------------        -------------------

           Total expenses                                                         $      570,787         $          559,290
                                                                                -----------------        -------------------

           Net income (loss)                                                      $      (11,630)        $              705
                                                                                =================        ===================
</TABLE>
                       See Notes to Financial Statements.
                                       7
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                    STATEMENTS OF CHANGES IN PARTNERS CAPITAL
                     Years Ended December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                       General                          Limited
                                          Total                        Partner                          Partner
                                   --------------                  ---------------                 ----------------
<S>                               <C>                            <C>                               <C>
Partners capital
     December 31, 2003             $    1,858,497                 $       44,281                    $    1,814,216

Partners capital
     contributions                           - -                             - -                               - -

Partners capital
     distributions                        (35,090)                       (18,563)                          (16,527)

Net income (loss)                            705                               7                               698
                                  ----------------                -----------------                 ----------------
Partners capital
     December 31, 2004            $    1,824,112                  $       25,725                    $    1,798,387

Partners capital
     contributions                           - -                             - -                               - -

Partners capital
     distributions                       (124,757)                       (86,999)                          (37,758)

Net income (loss)                         (11,630)                          (116)                          (11,514)
                                  -----------------               -----------------                 -----------------
Partners capital
     December 31, 2005            $    1,687,725                  $      (61,390)                   $    1,749,115
                                  =================               =================                 =================
Percentage at
     December 31, 2005                      100%                              1%                               99%
                                  =================               =================                 =================
</TABLE>
See Notes to Financial Statements.
                                       8
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                            STATEMENTS OF CASH FLOWS
                     Years Ended December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                     2005                              2004
                                                               ----------------                  ---------------
<S>                                                           <C>                               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                            $      (11,630)                   $          705
  Adjustments to reconcile net income
    (loss) to net cash provided by
      (used in) operating activities:
       Depreciation and amortization                                  184,011                           183,114
       Change in assets and liabilities:
        Decrease (increase) in:
          Prepaid expenses                                               (124)                              127
          Tenants' security deposits                                     (790)                             (444)
          Rents receivable                                                - -                               - -
          Other receivables                                               - -                               - -
        Increase (decrease) in:
          Accounts payable                                               (835)                              161
          Accounts payable - general partner                             (334)                            1,484
          Accrued expenses                                                - -                               - -
          Accrued interest                                                - -                               - -
          Prepaid rents                                                   - -                               - -
          Tenants' security deposits                                      (50)                           (1,000)
                                                               -----------------                ----------------
            Net cash provided by (used in)
               operating activities                            $      170,248                   $       184,147
                                                               -----------------                ----------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Funding of replacement reserve escrow                        $      (19,601)                  $      (18,754)
  Withdrawals from replacement reserve escrow                             - -                           49,095
  Acquisition of property and equipment                                (3,990)                         (52,545)
                                                               -----------------                ----------------
         Net cash provided by (used in)
            investing activities                               $      (23,591)                  $      (22,204)
                                                               -----------------                ----------------

CASH FLOWS FROM FINANCING ACTIVITIES
  Partner contributions                                        $          - -                   $          - -
  Partner distributions                                              (124,757)                         (35,090)
  Payment of development fees payable                                     - -                          (11,303)
  Principal payments on long-term debt                                (41,989)                         (37,331)
                                                               -----------------                ----------------
         Net cash provided by (used in)
             financing activities                              $     (166,746)                  $      (83,724)
                                                               -----------------                ----------------
</TABLE>
                       See Notes to Financial Statements.
                                       9
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                      STATEMENTS OF CASH FLOWS (CONTINUED)
                     Years Ended December 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                   2005                     2004
                                                             ----------------        ----------------
<S>                                                         <C>                      <C>
           Increase (decrease) in cash and
             cash equivalents                                $      (20,089)          $       78,219

Cash and cash equivalents
  Beginning                                                         133,309                   55,090
                                                             ----------------         ----------------
  Ending                                                     $      113,220           $      133,309
                                                             ================         ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
   INFORMATION
     Cash paid during the year for interest                  $      141,152           $      150,344
                                                             ================         ================
</TABLE>
                       See Notes to Financial Statements.
                                       10
<PAGE>
                           COLONIAL VILLAGE ROSEVILLE
                       (A California Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     A summary of the Partnership's significant accounting policies consistently
     applied  in  the  preparation  of  the  accompanying  financial  statements
     follows.

     BASIS OF ACCOUNTING
     -------------------

     The  financial  statements of the  partnership  are prepared on the accrual
     basis of accounting and in accordance with accounting  principles generally
     accepted in the United States of America.

     CAPITALIZATION AND DEPRECIATION
     -------------------------------

     Land,  buildings and  improvements  are recorded at cost.  Depreciation  of
     buildings  and  equipment  is  computed   principally  using  the  Modified
     Accelerated  Cost  Recovery  System which  approximates  straight-line  for
     buildings and  double-declining  balance for  equipment  over the following
     estimated useful lives:

                                                     Years
                                                    -------
               Buildings                             27.5
               Equipment                                7

     Improvements  are  capitalized,  while  expenditures  for  maintenance  and
     repairs are charged to expense as incurred.  Upon  disposal of  depreciable
     property,  the  appropriate  property  accounts  are reduced by the related
     costs and  accumulated  depreciation.  The  resulting  gains and losses are
     reflected in the statement of operations.

     CASH AND CASH EQUIVALENTS
     -------------------------

     For purposes of reporting  the  statements of cash flows,  the  Partnership
     includes all cash accounts which are not subject to withdrawal restrictions
     or  penalties,  and all highly  liquid debt  instruments  purchased  with a
     maturity  of  three  months  or less as cash and  cash  equivalents  on the
     accompanying balance sheet.

     AMORTIZATION
     ------------

     Deferred  charges are amortized over the following  estimated  useful lives
     using the straight-line method:

                                                   Years
                                                  -------
               Deferred debt expense                 30
               Tax credit monitoring fee             15

     INCOME TAXES
     ------------

     No  provision  or  benefit  for  income  taxes has been  included  in these
     financial statements since taxable income or loss passes through to, and is
     reportable by, the partners individually.

                                       11
<PAGE>
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     ESTIMATES
     ---------

     The  preparation  of financial  statements  in conformity  with  accounting
     principles  generally  accepted  in the United  States of America  requires
     management to make estimates and assumptions.  These assumptions affect the
     reported  amounts of assets,  liabilities  and the amount of any contingent
     assets and  liabilities  at the date of the  financial  statements  and the
     reported  amounts of revenues and  expenses  during the  reporting  period.
     Actual results could differ from the estimates made.

     PERSONAL ASSETS AND LIABILITIES
     -------------------------------

     In accordance with the generally accepted method of presenting  partnership
     financial statements,  the financial statements do not include the personal
     assets and  liabilities  of the partners,  including  their  obligation for
     income  taxes  on  their  distributive  shares  of the  net  income  of the
     Partnership, nor any provision for income tax expense.

     SFAS NO. 144
     ------------
     Statement of Financial  Accounting  Standards  (SFAS) No. 144 requires that
     long-lived assets and certain  identifiable  intangibles held and used by a
     entity  be  reviewed  for   impairment   whenever   events  or  changes  in
     circumstances  that the carrying amount of an asset may not be recoverable.
     The adoption of SFAS No. 144 has not materially  affected the partnership's
     reported earnings, financial condition or cash flows.

NOTE 2 - ORGANIZATION

     Colonial Village  Roseville is a California  Limited  Partnership which was
     formed in April 1993, to develop,  construct,  own,  maintain and operate a
     56-unit  multi-family  apartment  complex  and is  located  in the  city of
     Roseville,  California.  The  Partnership  Agreement and the loan agreement
     with the  Midland  Mortgage  Company  govern  the major  activities  of the
     Partnership.  Under the agreements,  the Partnership is required to provide
     low cost housing to very low-income or lower-income households.

     The Partnership has one general partner,  Project Go Inc., a 501(c) (3) tax
     exempt, non-profit community service organization and one investing limited
     partner,   WNC  Housing  Tax  Credits  III,  L.P.,  a  California   limited
     partnership.  Partnership  transactions  with the partners are described in
     other notes to these financial statements.


NOTE 3 - RESTRICTED DEPOSITS AND FUNDED RESERVES

     In accordance with the  Partnership  Agreement and the Rider to Multifamily
     Instrument with Midland  Mortgage  Company,  the Partnership is required to
     maintain a replacement reserve account.  The replacement reserve account is
     to be funded annually in the amount of $16,800.

                                       12
<PAGE>
                          NOTES TO FINANCIAL STATEMENTS

NOTE 4 - DEFERRED CHARGES

     Deferred  charges  as of  December  31,  2005  and  2004,  consists  of the
     following:
<TABLE>
<CAPTION>
                                                    2005                            2004
                                               ---------------                ---------------
<S>                                           <C>                            <C>
      Deferred debt expense                    $       110,462                $       110,462
      Tax credit monitoring fee                         22,960                         22,960
                                               ---------------                ---------------
                                               $       133,422                $       133,422
           Less accumulated amortization                54,940                         49,727
                                               ---------------                ---------------
                                               $        78,482                $        83,695
                                               ===============                ===============
</TABLE>
NOTE 5 - LONG-TERM DEBT

     Long-Term debt consisted of a permanent loan with Midland  Mortgage Company
     in face amount of $2,200,000.

     Under the terms of the  30-year  Promissory  Note  with  Midland,  the loan
     provides  for an initial  interest  rate of 7.67% and  monthly  payments of
     $15,639.62  commencing on September 1, 1995, and continuing  through August
     2025. The interest rate and monthly payment will be adjusted at year eleven
     (11) and year  twenty-one  (21),  at which time the  interest  rate will be
     adjusted  based on the  Current  Index plus 2.75% and the  payment  will be
     adjusted and determined by the amount of the monthly  payment that would be
     sufficient to repay the note within 360 months of the initial payment date.
     As Of December 31, 2005, the current  interest  rate,  and minimum  monthly
     payment due is 6.89% and $14,732.89, respectively.

     The  apartment  complex is pledged as  collateral  for the  mortgage and is
     secured by deeds of trust,  assignment of rents,  security  agreements  and
     fixture filings against the property.

     Aggregate  maturities  of  Long-term  debt for the next  five  years are as
     follows:
<TABLE>
<CAPTION>
<S>                    <C>                                      <C>
           December 31,     2006                                 $      47,524
                            2007                                        50,904
                            2008                                        54,524
                            2009                                        58,402
                            2010                                        62,555
                         Thereafter                                  1,623,807
                                                                 -------------
                            TOTAL                                $   1,897,716
                                                                 -------------
</TABLE>
NOTE 6 - TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES

     MANAGEMENT FEE
     --------------

     In accordance with the Management  Agreement,  the Partnership paid Project
     Go, Inc., the general partner,  management fees during 2005 and 2004 in the
     amounts of $34,944  and  33,600,  respectively,  for  services  rendered in
     connection  with the leasing and operation of the project.  The fee for its
     services is approximately 6% of the project's rental income.

                                       13
<PAGE>
                          NOTES TO FINANCIAL STATEMENTS

NOTE 7 - COMMITMENT

     The  Partnership  entered into a Regulatory  Agreement  with the Tax Credit
     Allocation Committee (TCAC),  established under Section 50185 of the Health
     and  Safety  Code of the State of  California.  Under this  Agreement,  the
     Partnership  shall maintain the project as a Qualified  Low-income  Housing
     Project for a period of 55 consecutive  taxable years  beginning with 1995,
     the  first  taxable  year  of the  Credit  Period.  In  exchange  for  this
     agreement,  TCAC has  authorized an allocation  relating to the  low-income
     housing credit under the  provisions of Section 42 of the Internal  Revenue
     Code.


NOTE 8 - CURRENT VULNERABILITY DUE TO CERTAIN CONCENTRATIONS

     The Partnership's sole asset is Colonial Village Roseville Apartments.  The
     Partnership's  operations are  concentrated in the multifamily  real estate
     market.


                                       14
<PAGE>