Exhibit 10.45
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                         LOAN AGREEMENT

                             BETWEEN

                 THE CITY OF ENGLEWOOD, COLORADO

                               AND

                   WELLSFORD MARKS WEST CORP.

                                                                 

                          Pertaining To

                           $11,200,000

                   CITY OF ENGLEWOOD, COLORADO
           MULTIFAMILY HOUSING REVENUE REFUNDING BONDS
                   (MARKS APARTMENTS PROJECT)
                           SERIES 1996



                   Dated as of October 1, 1996
                                                                 
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                        TABLE OF CONTENTS

                                                             Page

             ARTICLE IDEFINITIONS AND INTERPRETATION

SECTION 1.01.  Definitions . . . . . . . . . . . . . . . . . . .4
SECTION 1.02.  Interpretation. . . . . . . . . . . . . . . . . .9
SECTION 1.03.  Recitals, Titles and Headings . . . . . . . . . 10

 ARTICLE IIREPRESENTATIONS, WARRANTIES AND SPECIAL TAX COVENANTS

SECTION 2.01.  Representations and Warranties of the City. . . 11
SECTION 2.02.  Representations, and Warranties and Covenants
     of Owner. . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.03.  Compliance with Laws and Documents
     Governing Operations. . . . . . . . . . . . . . . . . . . 13
SECTION 2.04.  Tax-Exempt Status of the Bonds. . . . . . . . . 15
SECTION 2.05.  Eligible Tenants. . . . . . . . . . . . . . . . 17
SECTION 2.06.  Sale of Project . . . . . . . . . . . . . . . . 19

       ARTICLE IIITHE BONDS, BOND PROCEEDS, THE INDENTURE

SECTION 3.01.  Issuance of Bonds . . . . . . . . . . . . . . . 20
SECTION 3.02.  Bond Proceeds; Investments. . . . . . . . . . . 20
SECTION 3.03.  Indenture Approval and Requirements . . . . . . 20

          ARTICLE IVTHE LOAN, PREPAYMENTS, ASSIGNMENTS

SECTION 4.01.  Loan by City. . . . . . . . . . . . . . . . . . 21
SECTION 4.02.  Loan Payments . . . . . . . . . . . . . . . . . 21
SECTION 4.03.  Credits on Loan . . . . . . . . . . . . . . . . 22
SECTION 4.04.  Prepayment Generally. . . . . . . . . . . . . . 22
SECTION 4.05.  Optional Prepayment of Loan; Concurrent Bond
     Redemption. . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.06.  Extraordinary Optional Prepayment . . . . . . . 23
SECTION 4.07.  Provision of Alternate Security, Extraordinary
     Mandatory Prepayment of Loan. . . . . . . . . . . . . . . 23
SECTION 4.08.  Usury . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.09.  Assignments to Trustee. . . . . . . . . . . . . 24
SECTION 4.10.  Release of Owner from Covenants Hereunder . . . 25
SECTION 4.11.  Assignment of Agreement by Owner. . . . . . . . 25

                  ARTICLE VADDITIONAL COVENANTS

SECTION 5.01.  Permits and Licenses. . . . . . . . . . . . . . 26
SECTION 5.02.  Payment for Extraordinary Services. . . . . . . 26
SECTION 5.03.  Taxes and Other Governmental Charges. . . . . . 26
SECTION 5.04.  Insurance . . . . . . . . . . . . . . . . . . . 27
SECTION 5.05.  Application of Insurance and Condemnation
     Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 5.06.  General Tax Covenant. . . . . . . . . . . . . . 29

          ARTICLE VIINDEMNIFICATION OF CITY AND TRUSTEE

SECTION 6.01.  Indemnification of City and Trustee . . . . . . 31

            ARTICLE VIIBREACH OF COVENANTS, REMEDIES

SECTION 7.01.  Event of Default. . . . . . . . . . . . . . . . 32
SECTION 7.02.  Remedies for Failure to Perform . . . . . . . . 33
SECTION 7.03.  Discontinuance of Proceedings . . . . . . . . . 34
SECTION 7.04.  Remedies Cumulative . . . . . . . . . . . . . . 34
SECTION 7.05.  Waiver of Event of Default. . . . . . . . . . . 34

                    ARTICLE VIIIMISCELLANEOUS

SECTION 8.01.  Amounts Remaining in Funds and Accounts . . . . 35
SECTION 8.02.  Limited Obligation of City. . . . . . . . . . . 35
SECTION 8.03.  Payments by Guarantor . . . . . . . . . . . . . 35
SECTION 8.04.  Amendments, Changes or Modifications to Loan
     Agreement . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 8.05.  Rights of the Guarantor; References to the
     Guarantor . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 8.06.  Payment . . . . . . . . . . . . . . . . . . . . 36
SECTION 8.07.  Counterparts. . . . . . . . . . . . . . . . . . 36
SECTION 8.08.  Severability. . . . . . . . . . . . . . . . . . 36
SECTION 8.09.  Term of Agreement . . . . . . . . . . . . . . . 36
SECTION 8.10.  Notice of Changes in Fact . . . . . . . . . . . 37
SECTION 8.11.  Notices . . . . . . . . . . . . . . . . . . . . 37
SECTION 8.12.  Provision of Alternate Security . . . . . . . . 37
SECTION 8.13.  Guarantor Debt; Mandatory Provision of
     Alternate Security. . . . . . . . . . . . . . . . . . . . 38
SECTION 8.14.  Applicable Law. . . . . . . . . . . . . . . . . 38
<PAGE>
     THIS AGREEMENT (this "Agreement") is made and entered into as
of October 1, 1996, between the City of Englewood, Colorado, a
municipal corporation and political subdivision of the State of
Colorado (the "City") and Wellsford Marks West Corp. (the "Owner"),
a Colorado corporation.

                      W I T N E S S E T H:

     WHEREAS, the City is authorized by the County and Municipality
Development Revenue Bond Act, constituting Article 3, Title 29,
Colorado Revised Statutes (the "Act"), to finance one or more
projects, including any land, building, or other improvement, and
all real and personal properties, whether or not in existence,
which shall be suitable for residential facilities for low- and
middle-income families or persons and intended for use as the sole
place of residence by the owners or intended occupants to the end
that more adequate residential housing facilities for low- and
middle-income families and persons may be provided, which promote
the public health, welfare, safety, convenience and prosperity; and

     WHEREAS, the Act authorizes the City (a) to issue its revenue
bonds for the purpose of defraying the cost of financing any
project and all incidental expenses incurred in connection with the
issuance of such bonds, (b) to enter into financing agreements with
others for the purpose of providing revenues to pay the bonds
authorized to be issued under the Act and upon such terms and
conditions as the City Council of the City may deem advisable, and
(c) to secure the payment of the principal of, premium, if any, and
interest on such bonds as provided in the Act; and

     WHEREAS, Section 103(b)(4)(A) of the Internal Revenue Code of
1954, as amended (the "1954 Code"), provides that the interest on
fully registered obligations issued by or on behalf of a state or
a political subdivision thereof substantially all of the proceeds
of which are to be used to provide projects for residential rental
property shall be exempt from federal income taxation if, among
other requirements, at least 20% of the dwelling units in each
project (15% of the dwelling units in a project which is a
"targeted area" project, as defined in Treasury Regulation Section 1.103-
8(b)(8)(iii)) are to be occupied by individuals of low or moderate
income within the meaning of and for the period required by Section
103(b)(12) of the 1954 Code; and

     WHEREAS, the City has previously issued and delivered its City
of Englewood, Colorado, Variable Rate Demand Multifamily Housing
Revenue Bonds (The Marks Apartments) 1985 Series A, in the
aggregate principal amount of $12,200,000 (the "Prior Bonds"), to
obtain moneys to provide financing to HG Venture, a Texas limited
partnership (the "Original Owner") for the acquisition,
construction and installation of a multifamily rental housing
project (the "Project") which is located within the City, which is
occupied by persons of low and middle income, as defined by the
City, and which is occupied partially by individuals of low or
moderate income within the meaning of and for the period required
by Section 103(b)(12) of the 1954 Code, all for the public purpose
of providing more adequate residential housing facilities for low
and middle-income families and persons; and


     WHEREAS, in order to provide such financing, the City and the
Original Owner executed and delivered a Loan Agreement dated as
December 1, 1985 (the "Original Agreement") pursuant to which (a)
the City loaned to the Original Owner the proceeds of the Prior
Bonds (the "1985 Loan") and (b) the Original Owner agreed to
acquire, construct, install, operate and maintain the Project in
accordance with the requirements of the Act and Section
103(b)(4)(A) of the 1954 Code; and

     WHEREAS, the City, the Trustee and the Original Owner have
executed and delivered a Land Use Restriction Agreement dated as of
December 1, 1985 (the "Original Regulatory Agreement"), pursuant to
which the Original Owner has agreed to use and operate the Project
in accordance with the requirements of Section 103(b)(4)(A) of the
1954 Code; and

     WHEREAS, Wellsford Marks West Corp., a Colorado corporation
(the "Owner") has assumed all of the Original Owner's obligations
under the Original Agreement and the Original Regulatory Agreement;
and

     WHEREAS, the Owner has requested that the City issue, sell and
deliver its City of Englewood, Colorado, Multifamily Housing
Revenue Refunding Bonds (Marks Apartments Project) Series 1996 (the
"Bonds") in the aggregate principal amount of $11,200,000 for the
purpose of refunding all of the Prior Bonds and refinancing the
1985 Loan as permitted pursuant to the Internal Revenue Code of
1986, as amended; and

     WHEREAS, Wellsford Residential Property Trust (the
"Guarantor") has agreed to guarantee all of the Owner's payment
obligations under this Agreement, including payment of principal of
and interest on the Bonds when due, pursuant to the terms of a
Guaranty Agreement dated as of October 1, 1996 (the "Guaranty
Agreement") executed by the Guarantor for the benefit of the
Trustee; and

     WHEREAS, the Owner is obligated to reimburse the Guarantor
after the Guarantor makes payment under the Guaranty Agreement for
any amounts owing by the Owner to the Guarantor pursuant to the
Reimbursement Agreement, dated as of October 1, 1996 between the
Guarantor and the Owner and to secure such reimbursement obligation
of the Owner; and

     WHEREAS, the City Council of the City has expressly determined
and hereby confirms that the issuance of the Bonds and the
refinancing of the Project will accomplish a valid public purpose
of the City by continuing to provide more adequate residential
housing facilities for low- and middle-income families and persons,
which promote the public health, welfare, safety, convenience and
prosperity; and

     WHEREAS, the Bonds will be secured by (a) a pledge of this
Agreement, (b) a pledge of the revenues and receipts derived by the
City pursuant to this Agreement, and (c) the Guaranty Agreement;
and



     WHEREAS, the City, the Trustee, and the Owner have executed
and delivered an Amended and Restated Regulatory Agreement dated as
of October 1, 1996 (the "Regulatory Agreement"), pursuant to which
the Owner has agreed to use and operate the Project in accordance
with the requirements of Section 103(b)(4)(A) of the 1954 Code.

     NOW, THEREFORE, in consideration of the premises and the
mutual covenants and undertakings set forth herein, the parties
hereto agree as follows:<PAGE>
                            ARTICLE I

                 DEFINITIONS AND INTERPRETATION

     SECTION 1.1.   Definitions.  For all purposes of this
Agreement, except as otherwise expressly provided or unless the
context otherwise requires, capitalized terms used herein shall
have the following meanings:

     "Act" - The County and Municipality Development Revenue Bond
Act, constituting Article 3, Title 29, Colorado Revised Statutes.

     "Adjusted Gross Income" - With respect to a person, the
adjusted gross income of such person as set forth on such person's
federal income tax return for the immediately preceding taxable
year, as evidenced by a copy of such return or by a sworn statement
of such persons.

     "Agreement" - This Loan Agreement, dated as of October 1,
1996, between the Owner, as borrower, and the City, as lender,
together with any amendments or supplements hereto.

     "Alternate Security" - Any guaranty agreement, letter of
credit, surety bond, bond insurance policy or other security, or
any combination of  the foregoing, with a term ending on the
maturity of the Bonds substituted for the Guaranty Agreement and
providing for the payment of (i) the principal of and interest on
the Bonds when due, together with amounts sufficient to pay the
Purchase Price thereof upon mandatory redemption of the Bonds
pursuant to the Indenture and (ii) all amounts under the Agreement
when due on or prior to the payment dates provided by the Guaranty
Agreement which will result in the Bonds being assigned an
investment grade credit rating available by a nationally recognized
rating agency (e.g., rated "AAA," "AA," "A" or "BBB" by S&P, or a
comparable rating category assigned by another nationally
recognized rating agency).

     "Authorized Representative" - A person or persons at the time
designated to act on behalf of the Owner by written certificate
furnished to the Trustee containing the specimen signature of such
person or persons and signed on behalf of the Owner by its
President, which certificate may designate an alternate or
alternates, and may designate more than one person to act
collectively, as the Authorized Representative for one or more
purposes.

     "Bond" or "Bonds" - Any one or more or all, as the case may
be, of the Bonds issued pursuant to the Indenture, entitled "City
of Englewood, Colorado, Multifamily Housing Revenue Refunding
Bonds, (Marks Apartments Project) Series 1996," in the aggregate
principal amount of $11,200,000, and fully described in the
Indenture.

     "Bond Counsel" - A firm or firms of nationally recognized
attorneys at law, approved by the Trustee, the City, the Owner and
the Guarantor, such approval not to be unreasonably withheld, and
experienced in the financing of facilities for non-exempt persons
through the issuance of tax-exempt revenue bonds under the
exemptions provided under Section 103 of the Code.

     "Business Day" - A day on which banks in the cities in which
the principal offices of the Trustee and the Guarantor are located
are not required or authorized by law to remain closed and on which
The New York Stock Exchange is not closed.

     "City" - The City of Englewood, Colorado, a municipal
corporation and political subdivision organized and existing under
the Charter and the laws and Constitution of the State of Colorado,
the issuer of the Bonds, and its successors and assigns.

     "Code" - The Internal Revenue Code of 1986, as amended,
together with corresponding and applicable final, temporary or
proposed regulations and revenue rulings issued or amended with
respect thereto by the Treasury Department or Internal Revenue
Service of the United States.

     "Completion Date" - The date upon which the Project was
completed, January 1, 1987.

     "Counsel for the Trustee" - An attorney at law or firm of
attorneys at law selected by the Trustee as its counsel, which may
include the in-house counsel of the Trustee or its banking
associates.

     "Development Costs" - To the extent authorized by the 1954
Code and the Act, any and all costs incurred by the City or the
Owner with respect to the acquisition, construction, and equipping,
as the case may be, of the Project, including, without limitation,
costs for site preparation, the planning of housing and related
facilities and improvements, the acquisition of property, the
removal or demolition of existing structures, the construction of
housing, related facilities and improvements, and all other work in
connection therewith, and all costs of financing, including,
without limitation, the cost of consultant, accounting and legal
services, other expenses necessary or incident to determining the
feasibility of the Project, contractors' and Owner's overhead and
supervisors' fees and costs directly allocable to the Project and
the financing thereof (including reimbursements to any
municipality, city or entity for expenditures made, with the
approval of the City, for the Project), interest prior to the
Completion Date, and all other costs approved by Bond Counsel.

     "Determination of Taxability" - A final judgment or order of
a court of competent jurisdiction, or a final ruling or decision of
the Internal Revenue Service, to the effect that the interest on
any of the Bonds (other than interest on any Bond for any period
during which such Bond is held by a "substantial user" of any
facility financed with the proceeds of the Bonds or a "related
person," as such terms are used in Section 103(b) of the 1954 Code)
is includable for federal income tax purposes in the gross incomes
of the recipients thereof as a result of any action or failure to
act on the part of the Owner in violation of the Regulatory
Agreement.  A Determination of Taxability shall not be deemed to
have occurred by reason of the issuance of any assessment described
in this definition unless (i) such taxpayer is neither a
"substantial user" of the Project or a "related person" within the
meaning of Section 103(b)(13) of the 1954 Code, and (ii) (A) no
later than sixty (60) days prior to the last to occur of the last
day on which said taxpayer may contest such assessment before
either the Internal Revenue Service or the Tax Court or any other
court of competent jurisdiction, or after payment by such taxpayer
of the taxes so assessed, the last day on which such taxpayer may
sue for a refund of such taxes before either the Court of Claims or
any District Court of the United States or any other court of
competent jurisdiction, such taxpayer gives notice to the Owner of
such assessment and/or payment, together with a copy of said
statutory notice of deficiency, and gives the Owner his power of
attorney, in form and substance reasonably satisfactory to the
Owner, to contest such assessment or sue for such refund, as the
case may be, at its own cost and in the name of such taxpayer, (B)
such taxpayer cooperates in every reasonable way with the Owner in
prosecuting such contest or suit, and (C) the Owner nonetheless
fails to obtain a final determination from which no timely appeal
shall have been filed whereunder such assessment is withdrawn or
overturned insofar as it relates to such inclusion or such refund
is obtained insofar as it relates to such inclusion.

     "Eligible Tenants" - Any person whose Adjusted Gross Income,
together with the Adjusted Gross Income of all persons who intend
to reside with such person in one dwelling unit, did not, for the
immediately preceding taxable year, immediately preceding their
initial occupancy of such dwelling unit, exceed an amount equal to
175% of the Median Gross Income for the Area, adjusted for the
number of persons who intend to reside in such dwelling unit in a
manner consistent with making adjustments for family size for
purposes of determining "lower income families" under Section
8(f)(3) of the Housing Act, or such greater percentage of Median
Gross Income for the Area as may be established from time to time
by the City Council of the City, in accordance with the Act, as the
maximum amount constituting middle income within the meaning of the
Act.

     "Event of Default" - Any Event of Default specified in Section
7.01 of this Agreement.

     "Guarantor" - Wellsford Residential Property Trust, a Maryland
real estate investment trust, and its successors and assigns, and,
after substitution of Alternate Security in accordance with this
Agreement and the Indenture, any provider of Alternate Security.

     "Guaranty Agreement" - The Guaranty Agreement, dated as of
October 1, 1996 executed by the Guarantor for the benefit of the
Trustee, its successors and assigns including any amendments and
supplements thereto pursuant to which certain of the Owner's
payment obligations under this Agreement are unconditionally and
irrevocably guaranteed, and, after substitution in accordance with
this Agreement and the Indenture, any Alternate Security.

     "Housing Act" - means the United States Housing Act of 1937,
as amended, codified as 42 U.S.C. Section 1401 et seq.

     "Income Certification" - With respect to Lower-Income and all
other Eligible Tenants, an income certification substantially in
the form attached to the Regulatory Agreement as Exhibit B, as such
form may be revised by the City from time to time.

     "Indenture" - The Indenture of Trust dated as of October 1,
1996, by and between the City and the Trustee, pursuant to which
the Bonds are issued and secured, together with any amendments or
supplements thereto.

     "Interest Payment Date" - June 1 and December 1 of each year,
commencing June 1, 1997, until the maturity or redemption of all
Bonds.

     "Land" - The tract of land on which the Project is
constructed.

     "Loan" - The loan from the City to the Owner made pursuant to
this Agreement, as evidenced by the Note.

     "Lower-Income Tenants" - Individuals of low or moderate income
within the meaning of Section 103(b)(12)(C) of the 1954 Code and
Section 1.103-8(b) of the regulations promulgated thereunder, as
the same may be amended from time to time, which include
individuals and families whose aggregate adjusted income (computed
in the manner prescribed in Treasury Regulation Section 1.167k-3(b)(3))
does not exceed 80% of the Median Gross Income for the Area with
adjustments downward from such 80% of Median Gross Income for the
Area for the number of persons who intend to reside in such
dwelling unit in a manner consistent with making adjustments for
family size for purposes of determining "lower income families"
under Section 8(f)(3) of the Housing Act.

     "Median Gross Income for the Area" - The median income for the
area where the Project is located as determined by the Secretary of
Housing and Urban Development under Section 8(f)(3) of the Housing
Act, or if programs under Section 8(f) are terminated, median
income determined under the method used by said Secretary prior to
such termination.

     "Moderate Income Tenants" - Any person whose Adjusted Gross
Income, together with the Adjusted Gross Income of all persons who
intend to reside with such person in one dwelling unit, for the
taxable year immediately preceding their initial occupancy of such
dwelling unit, exceeded an amount equal to 80% of Median Gross
Income for the Area with adjustments downward from such 80% of
Median Gross Income for the Area for the number of persons who
intend to reside in such dwelling unit in a manner consistent with
making adjustments for family size for purposes of determining
"lower income families" under Section 8(f)(3) of the Housing Act
but did not exceed an amount equal to 130% of the Median Gross
Income for the Area, adjusted for the number of persons who intend
to reside in such dwelling unit in a manner consistent with making
adjustments for family size for purposes of determining "lower
income families" under Section 8(f)(3) of the Housing Act.

     "1954 Code" - The Internal Revenue Code of 1954, as amended,
together with corresponding and applicable final, temporary or
proposed regulations and revenue rulings issued or amended with
respect thereto by the Treasury Department or Internal Revenue
Service of the United States.

     "Note" - The promissory note from the Owner to the City
evidencing the payment obligations of the Owner under this
Agreement, substantially in the form attached hereto as Exhibit A,
and any and all amendments and supplements thereto.


     "Official Statement" - The Official Statement delivered in
connection with the original issue and sale of the Bonds.

     "Original Loan Agreement" - The Loan Agreement dated as of
December 1, 1985 between the Original Owner and the City.

     "Original Owner" - HG Venture, a Texas limited partnership.

     "Original Regulatory Agreement" - The Land Use Restriction
Agreement dated as of December 1, 1985 among the City, the Original
Owner, Mellon Bank, N.A., as trustee, and Citicorp Real Estate,
Inc. 

     "Owner" - Wellsford Marks West Corp., a Colorado corporation,
its successors and assigns, including any surviving, resulting or
transferee entity permitted under this Agreement or the Regulatory
Agreement.

     "Prior Bonds" - The City of Englewood, Colorado, Variable Rate
Demand Multifamily Housing Revenue Bonds (The Marks Apartments)
1985 Series A.

     "Prior Trustee" - Mellon Bank, N.A., pursuant to the terms of
an Indenture of Trust dated as of December 1, 1985, between the
City and Mellon Bank, N.A.

     "Project" - The multifamily rental housing project known as
Marks West Apartments, consisting of those facilities, including
real property, structures, buildings, fixtures or equipment,
described in Exhibit B hereto, as they may at any time exist, which
facilities are to be refinanced, in whole or in part, from the
proceeds of the sale of the Bonds or the proceeds of any payment by
the Owner, and any real property, structures, buildings, fixtures
or equipment acquired in substitution for, as a renewal or
replacement of, or a modification or improvement to, all or any
part of the facilities described in Exhibit B.

     "Purchase Date" - A date on which Bonds are purchased in lieu
of redemption or acceleration pursuant to Section 4.04 of the
Indenture.

     "Qualified Project Period" - That period, beginning on the
later of (i) the first day on which at least 10% of the units in
the Project were first occupied or (ii) the date of issuance of the
Bonds, and ending on the later of (a) the date which is ten years
after the date on which at least 50% of the units in the Project
were first occupied, (b) the date which is a "qualified number of
days" after the date of initial occupancy of any unit in the
Project (for this purpose a "qualified number of days" means 50% of
the total number of days from the date of issuance of the Bonds
until the date such Bonds are no longer outstanding plus 50% of the
total number of days from the date of issuance of any bonds
refunding the Bonds to the maturity date of such refunding bonds
with the longest maturity, including any subsequent refunding
obligations), or (c) the date on which any assistance provided with
respect to the Project under Section 8 of the United States Housing
Act of 1937, as amended, terminates.

     "Refunding Project" - The refunding of all of the City's
outstanding Variable Rate Demand Multifamily Housing Revenue Bonds
(The Marks Apartments) 1985 Series A.

     "Registered Owner" or "owner" - The person in whose name any
Bond is registered on the Bond registration books of the City kept
by the Trustee as bond registrar.

     "Regulatory Agreement" - The Amended and Restated Land Use
Restriction Agreement, dated as of October 1, 1996, among the City,
the Trustee and the Owner, as originally executed or as it may from
time to time be supplemented, modified or amended.

     "Reimbursement Agreement" - Any Reimbursement Agreement
between the Owner and the Guarantor and any amendments or
supplements thereto pursuant to which the Owner agrees to reimburse
the Guarantor for any and all amounts paid by the Guarantor
pursuant to the Guaranty Agreement or, after provision of any
Alternate Security, any agreement between the Owner and the
provider of such Alternate Security which provides for the
reimbursement of the provider of Alternate Security by the Owner
for payments made by such provider of Alternate Security under such
Alternate Security.

     "S & P" - Standard & Poor's Rating Services, a Division of the
McGraw-Hill Companies, its successors and their assigns, and, if
such corporation shall for any reason no longer perform the
functions of a securities rating agency, "S & P" shall be deemed to
refer to any other nationally recognized securities rating agency
designated by the City with the approval of the Owner and the
Guarantor.

     "State" - The State of Colorado.

     "Tax Certificate" - The Federal Tax Exemption Certificate or
Certificates, dated as of the delivery date of the Bonds, executed
and delivered by the City and the Owner, as amended, supplemented
or otherwise modified from time to time.  

     "Trustee" - American National Bank and Trust Company of
Chicago, Chicago, Illinois, as trustee under the Indenture, and its
successors in trust thereunder.

     "Underwriter" - First Chicago Capital Markets, Inc.

     Such terms as are not defined herein shall have the meanings
assigned to them in the Indenture.

     SECTION 1.2.   Interpretation.  Unless the context clearly
requires otherwise, words of masculine gender shall be construed to
include correlative words of the feminine and neuter genders and
vice versa, and words of the singular number shall be construed to
include correlative words of the plural number and vice versa. 
This Agreement and all the terms and provisions hereof shall be
construed to effectuate the purpose set forth herein and to sustain
the validity hereof.

     SECTION 1.3.   Recitals, Titles and Headings.  The terms and
phrases used in the recitals of this Agreement have been included
for convenience of reference only, and the meaning, construction
and interpretation of all such terms and phrases for purposes of
this Agreement shall be determined by references to Section 1.01
hereof.  The titles and headings of the articles and sections of
this Agreement have been inserted for convenience of reference only
and are not to be considered a part hereof, and shall not in any
way modify or restrict any of the terms or provisions hereof and
shall never be considered or given any effect in construing this
Agreement or any provision hereof or in ascertaining intent, if any
question of intent should arise.

                       (End of Article I)
<PAGE>
                           ARTICLE II

      REPRESENTATIONS, WARRANTIES AND SPECIAL TAX COVENANTS

     SECTION 2.1.   Representations and Warranties of the City. 
The City makes the following representations and warranties as the
basis for the undertakings on the part of the Owner herein
contained:

          (a)  The City is a municipal corporation and
     political subdivision duly organized and existing under
     the laws and Constitution of the State.

          (b)  The City has full legal right, power and
     authority under the laws of the State of Colorado and has
     taken all official actions necessary (i) to enter into
     this Agreement, the Regulatory Agreement and the
     Indenture, (ii) to issue, execute and deliver the Bonds,
     (iii) to perform its obligations hereunder and
     thereunder, and (iv) to consummate all other transactions
     contemplated by this Agreement and such other documents,
     including, without limitation, the loaning of a portion
     of the proceeds of the Bonds to the Owner.

          (c)  By proper action the City has duly authorized
     (i) the execution and delivery of this Agreement, the
     Regulatory Agreement and the Indenture, (ii) the
     performance by the City of its obligations hereunder and
     thereunder, and (iii) the consummation of the
     transactions contemplated hereunder and thereunder.

          (d)  The execution and delivery of this Agreement,
     the Regulatory Agreement and the Indenture, the issuance,
     execution and delivery of the Bonds, the performance by
     the City of its obligations hereunder and thereunder, and
     the consummation of the transactions contemplated hereby
     and thereby, including, without limitation, the loaning
     of the proceeds of the Bonds to the Owner, do not
     violate, conflict with or constitute a breach of or a
     default under the Act or, to the best knowledge of the
     City, any other law or regulation applicable to the City,
     or under the terms and conditions of any agreement,
     instrument or commitment to which the City is a party or
     by which the City or any of its property is bound.

          (e)  The City has determined that the financing of
     the Project and the issuance of the Bonds to obtain
     moneys to carry out the financing of the Project will
     serve the public interest and will further the purposes
     of the Act, including, among other purposes, the
     provision of more adequate residential housing facilities
     for low- and middle-income families and persons.

          (f)  The City makes no other warranties, either
     express or implied, as to the Project or the financing
     thereof, of any nature or kind.

     SECTION 2.2.   Representations, and Warranties and Covenants
of Owner.  The Owner hereby represents, warrants and agrees as
follows:

          (a)  The Owner (i) is a Colorado corporation validly
     existing under the laws of the State; (ii) is organized
     and operated for the purpose, among others, of acquiring,
     constructing, owning and operating the Project; (iii) has
     full power and authority under its organizational
     documents and the laws of the State to execute and
     deliver this Agreement and the Regulatory Agreement, to
     be bound by the terms of the Indenture and to perform its
     obligations hereunder and thereunder; and (iv) by proper
     action has duly authorized the execution and delivery of
     this Agreement and the Regulatory Agreement, and when
     validly executed and delivered by the other parties
     thereto, such documents will constitute legal and valid
     agreements of the Owner.

          (b)  The execution, delivery and performance of this
     Agreement and the Regulatory Agreement, and the
     consummation of the transactions herein and therein
     contemplated, (i) will not violate any law, regulation,
     ordinance, judgment or court order of any federal, state
     or local government, and (ii) do not conflict in any
     material respect with or constitute a material breach of
     or a material default under the Owner's Articles of
     Incorporation or Bylaws or under the terms and conditions
     of any instrument, document, agreement, commitment,
     indenture, security agreement, mortgage, lease or other
     writing to which the Owner is a party or by which the
     Owner, or a substantial portion of its assets, is bound.

          (c)  There are no actions, suits or proceedings
     pending or, to the knowledge of the Owner, threatened
     against or affecting the Owner or the Project, or
     involving the validity or enforceability of the Bonds,
     this Agreement, the Regulatory Agreement, the Guaranty
     Agreement or the Indenture, at law or in equity, or
     before or by any governmental authority, except actions
     which, if adversely determined, would not materially
     impair the ability of the Owner to perform the Owner's
     obligations under this Agreement and the Regulatory
     Agreement, and to cause to be paid any amounts which may
     become payable under this Agreement.  The Owner is not in
     default in any material respect under any mortgage, deed
     of trust, lease, loan or credit agreement, corporate
     agreement or other instrument to which the Owner is a
     party or by which it is bound.

          (d)  Any certificate signed by an Authorized
     Representative and delivered pursuant to the Indenture or
     this Agreement and the Regulatory Agreement shall be
     deemed a representation and warranty by the Owner as to
     the statements made therein.

          (e)  Concurrently with the execution of this
     Agreement, the Owner will cause to be delivered to the
     Trustee, for the benefit of the owners of the Bonds, the
     Guaranty Agreement, and to the knowledge of the Owner the
     Guaranty Agreement shall be in full force and effect and
     shall secure the payment of the principal and interest on
     the Bonds in accordance with its terms.

          (f)  The Indenture has been submitted to the Owner
     for its examination; and the Owner acknowledges, by
     execution of this Agreement, that it has approved the
     Indenture and agrees that it will be bound by the terms
     thereof.

          (g)  The information and estimates with respect to
     the development and the financing of the Project
     heretofore furnished to Sherman & Howard L.L.C., Bond
     Counsel, are true and correct to the best of the
     information and belief of the Owner and do not omit any
     statement the omission of which would render any of the
     statements made therein misleading in the circumstances
     in which they are made.

     SECTION 2.3.   Compliance with Laws and Documents Governing
Operations.  The Owner hereby represents, warrants and agrees as
follows:

          (a)  The Owner has complied with all applicable laws
     and requirements of governmental authorities relating to
     the use and operation of the Project, except as disclosed
     to the City in writing on the date of the execution of
     this Agreement. 

          (b)  (1) Since its acquisition of the Project on
     April 11, 1996, the Owner has been in continuous
     compliance and is in full compliance in all material
     respects with the terms and conditions of the Original
     Loan Agreement, as in effect prior to the date hereof,
     the Original Regulatory Agreement and this Agreement; (2)
     to he date hereof, the Original Loan Agreement and the
     Original Regulatory Agreement were in full force and
     effect; (3) all fees, expenses and cost reimbursements
     owed to the City and Mellon Bank, N.A., as trustee,
     including but not limited to amounts accrued but not yet
     payable, have been paid or provided for; and (4) to the
     best of our knowledge, the Project has been in continuous
     compliance and is in compliance in all material respects
     with the other material terms and conditions of the
     Original Loan Agreement and the Original Regulatory
     Agreement.

          (c)  The Owner has filed all federal, state and
     local income tax returns, which are required at this time
     to be filed by it, and has paid all taxes as shown on
     said returns and all assessments received by the Owner to
     the extent that such taxes have become due and payable by
     it.

          (d)  The Owner has good and indefeasible title to
     the Project, and such properties are free and clear of
     all liens and encumbrances, except for (i) liens for
     taxes and assessments not yet due, (ii) the lien of the
     Regulatory Agreement and (iii) the liens created under
     the Original Loan Agreement, the Original Regulatory
     Agreement and the related deeds of trust which secure
     such instruments, which the liens the Owner hereby
     covenants will be released upon the payment in full of
     the Prior Bonds on December 3, 1996. 

          (e)  No substantial loss, damage, destruction or
     taking of any of the real or personal property of the
     Owner, constituting all or a portion of the Project, has
     occurred which has not been fully restored or replaced or
     which is not fully covered by insurance, less applicable
     deductibles.

          (f)  (1) The Owner has not received any notice that
     it is not in compliance with all provisions of the
     Comprehensive Environmental Response, Compensation, and
     Liability Act of 1980, as amended; the Resource
     Conservation and Recovery Act; the Superfund Amendments
     and Reauthorization Act of 1986; the Toxic Substances
     Control Act and all environmental laws of the State (the
     "Environmental Laws"), or with any rules, regulations and
     administrative orders of any governmental agency, or with
     any judgments, decrees or orders of any court of
     competent jurisdiction with respect thereto; and (2) the
     Owner has not received any assessment, notice of (primary
     or secondary) liability or notice of financial
     responsibility and no notice of any action, claim or
     proceeding to determine such liability or responsibility,
     or the amount thereof, or to impose civil penalties with
     respect to the Project under any Environmental Law, nor
     has the Owner received notification that any hazardous
     substances (as defined under CERCLA) that it has disposed
     of have been found in any site at which any governmental
     agency is conducting an investigation or other proceeding
     under any Environmental Law.

          (g)  The Owner has not received any notice that it
     is not in full compliance with all provisions of the Fair
     Labor Standards Act, as amended, and regulations
     promulgated thereunder.

          (h)  The Owner has paid or made provision for the
     payment of all applicable federal, state and local
     employees' income, social security and unemployment
     taxes.

          (i)  The Owner has not received any notice that it
     is not in full compliance with ERISA and Department of
     Labor regulations thereunder, with the Code and Treasury
     Regulations thereunder and with the terms of such plan or
     plans with respect to each pension or welfare benefit
     plan to which the Owner is a party or makes any employer
     contributions with respect to its employees, for the
     current or prior plan years of such plans.

          (j)  The Project provides and will provide adequate,
     safe and sanitary residential facilities within the
     City's jurisdiction, for low and middle income families
     and persons (as defined in the Act) intended for use as
     the sole place of residence by the owners or occupants
     thereof.

          (k)  The Owner has operated and intends to operate
     or cause to be operated the Project as a "project" within
     the meaning of the Act, so long as the Bonds remain
     outstanding, shall in good faith and with due diligence
     use its best efforts to rent units in the Project to
     Eligible Tenants and shall otherwise comply with the
     additional requirements hereof.

          (l)  The Project is located wholly within the
          boundaries of the City.

          (m)  The Owner has been and is in compliance with
     those conditions contained in the Original Loan Agreement
     and the Original Regulatory Agreement, including, without
     limitation, those provisions set forth therein which are
     necessary to preserve the exclusion from gross income for
     Federal income tax purposes of interest on the Bonds.

     
     SECTION 2.4.   Tax-Exempt Status of the Bonds.    The Owner
hereby represents, warrants and agrees for the benefit of the City
and the owners of the Bonds from time to time that:

          (a)  It will not take any action or omit to take any
     action with respect to the Bonds, the proceeds thereof or
     the Project if such action or omission (i) would cause
     the interest on the Bonds to lose its exclusion from
     gross income for federal income tax purposes under
     Section 103 of the Code, except for interest on any Bond
     for any period during which it is held by a "substantial
     user" of the Project or a "related person" as such terms
     are used in Section 103(b)(13) of the 1954 Code. The
     foregoing covenant shall remain in full force and effect
     notwithstanding the payment in full or defeasance of the
     Bonds until the date on which all obligations of the
     Owner in fulfilling the above covenant under the Code and
     the 1954 Code have been met. 

          (b)  Throughout the Qualified  Project Period at
     least 20% of completed dwelling units in the Project (15%
     of the dwelling units in the Project if it is or becomes
     a "targeted area" project as defined in Treasury
     Regulation Section 1.103-8(b)(8)(iii)) will be continuously
     occupied by Lower-Income Tenants.  For the purpose of
     complying with this requirement, a unit occupied by an
     individual or family who at the commencement of the
     occupancy qualifies as a Lower-Income Tenant is treated
     as occupied by such an individual or family during their
     tenancy in such unit, even though they subsequently cease
     to be of low or moderate income.  Moreover, if a unit is
     vacated by an individual or family who qualified as
     Lower-Income Tenants, such unit shall be treated as
     occupied by Lower-Income Tenants until reoccupied (other
     than for a temporary period of not more than 31 days) at
     which time the character of the unit shall be
     redetermined.  The dwelling units required to be rented
     to, or held available for, occupancy by Lower-Income
     Tenants shall be distributed among the different types of
     dwelling units, by number of bedrooms, in approximately
     the same proportions as each type of dwelling unit is to
     the total number of dwelling units.

          (c)  It will take such action or actions as may be
     necessary, in the opinion of Bond Counsel, including,
     without limitation, consenting to the amendment of this
     Agreement, the Indenture or the Regulatory Agreement to
     comply fully with all applicable rules, rulings,
     policies, procedures, regulations or other official
     statements promulgated, proposed or made by the
     Department of the Treasury or the Internal Revenue
     Service pertaining to obligations issued under
     Section 103(b)(4)(A) of the 1954 Code which are necessary
     in the opinion of Bond Counsel to maintain the exclusion
     from gross income for federal income tax purposes of
     interest on the Bonds.

          (d)  It will execute and file of record appropriate
     amendments to the Regulatory Agreement and assure the
     recording of such document and take any other steps as
     are necessary, in the opinion of Bond Counsel, in order
     to insure that the requirements and restrictions of this
     Article II will be binding upon all owners of the
     Project.  The Owner hereby covenants to include such
     requirements and restrictions in any documents
     transferring any interest in the Project to another to
     the end that such transferee has notice of, and is bound
     by such restrictions to the extent and for the period
     provided therein and to obtain the agreement from any
     transferee to so abide.

          (e)  That the Owner shall not discriminate on the
     basis of race, color, religion, sex, age, national
     origin, handicap, marital or familial status in the
     lease, use, or occupancy of the Project or in connection
     with the employment or application for employment of
     persons for the operation and management of the Project.

          (f)  That none of the dwelling units in the Project
     shall at any time be utilized on a transient basis, shall
     ever be leased or rented for a period of less than thirty
     days, and shall ever be used as a hotel, motel,
     dormitory, fraternity house, sorority house, rooming
     house, hospital, sanitarium, nursing home, rest home,
     trailer court or park.

          (g)  That the Project is located on a single tract
     of land or on two or more contiguous tracts of land, and
     that all of the buildings, structures and facilities
     which are part of the Project comprise a single
     geographically and functionally integrated project for
     residential rental property, as evidenced by the
     ownership, management, accounting and operation of the
     Project.

          (h)  That the Owner intends to hold the Project for
     its own account, has no current plan to sell and has not
     entered into any agreement to sell any of the Project,
     and, until payment in full of all the Bonds, will not
     sell or contract to sell the Project without having first
     delivered to the Trustee an opinion of Bond Counsel to
     the effect that such sale will not affect the exclusion
     from gross income for federal or Colorado income tax
     purposes; provided that no such opinion shall be required
     in connection with a foreclosure sale or a transfer by
     deed in lieu of foreclosure or comparable conversion of
     the Project.

          (i)  The average maturity of the Bonds does not
     exceed 120% of the average reasonably expected life of
     the facilities of the Project financed with the original
     net proceeds of the Prior Bonds.

          (j)  The Bonds are not and shall not be "federally
     guaranteed" as defined in Section 149(b) of the Code.

     SECTION 2.5.   Eligible Tenants.

          (a)  In addition to, and not in limitation of the
     provisions of the 1954 Code, the Owner declares its
     understanding, intent and agreement that the Project is to be
     owned, managed and operated to provide residential facilities
     for low- and middle-income families or persons in accordance
     with the Act for a period beginning on the date of issuance of
     the Bonds and ending on the last day any Bonds remain
     outstanding.

          (b)  The City hereby represents, covenants and agrees as
     follows:

               (1)  the City Council of the City, in accordance
     with the provisions of the Act, has determined that, for
     purposes of the Project, "low-and middle-income persons and
     families" within the meaning of the Act shall include any
     person whose adjusted gross income as set forth on such
     person's federal income tax return for the immediately
     preceding taxable year ("Adjusted Gross Income"), together
     with the Adjusted Gross Income of all persons who intend to
     reside with such person in one dwelling unit, did not, for the
     immediately preceding taxable year, exceed an amount equal to
     175% of the Median Gross Income for the Area, adjusted for the
     number of persons who intend to reside in such dwelling unit
     in a manner consistent with making adjustments for family size
     for purposes of determining "low income families" under
     Section 8(f)(3) of the United States Housing Act of 1937, or
     such other amount as may be established from time to time by
     the City Council of the City, in accordance with the Act and
     this Section as the maximum amount constituting middle income
     within the meaning of the Act; and

               (2)  in the event that the Median Gross Income for
     the Area for any year is less than the Median Gross Income for
     the Area for the immediately preceding year, the City Council
     may review the percentage of Median Gross Income for the Area
     which shall be the maximum amount constituting middle income
     within the meaning of the Act and may make such upward
     adjustments of such percentage as it shall deem reasonable and
     necessary and shall advise the Owner in writing of any such
     adjustments; provided, however, that the City shall provide
     the Owner and the Trustee with an opinion of Bond Counsel
     acceptable to the City, the Trustee and the Owner
     substantially to the effect that the adjusted amount will not
     adversely affect the validity of the Bonds or the exclusion
     from gross income for federal income tax purposes of the
     interest on the Bonds.

          (c)  The Owner hereby represents, covenants and agrees as
     follows:

               (1)  all of the occupied dwelling units in the
     Project shall be occupied by Eligible Tenants;

               (2)  the dwelling units in the Project which are to
     be occupied by Lower-Income Tenants, or held available during
     temporary periods for such occupancy, as required pursuant to
     the Regulatory Agreement and this Agreement, shall be
     distributed among the different types of dwelling units, by
     number of bedrooms, in approximately the same proportion as
     each type of dwelling unit bears to the total number of
     dwelling units in the Project;

               (3)  the Owner shall obtain and maintain on file
     with respect to each Eligible Tenant who resides in the
     Project, a statement evidencing that such tenant's income for
     the taxable year immediately preceding such Eligible Tenant's
     initial occupancy did not exceed such amount as the City has
     determined to be the maximum amount constituting middle income
     within the meaning of the Act; provided, however, the Owner
     shall not be required to obtain a federal income tax return
     with respect to each such Eligible Tenant;

               (4)  the Owner shall permit any duly authorized
     representative of the City or the Trustee to inspect the books
     and records of the Owner pertaining to the incomes of the
     persons residing in the Project;

               (5)  the Owner shall prepare and submit to the City
     and the Trustee, within fifteen days after each three month
     period ending March 31, June 30, September 30 or December 31,
     a certificate (in the form attached as Exhibit B to the
     Regulatory Agreement) executed by an Authorized Representative
     stating as of such March 31, June 30, September 30 or
     December 31, as appropriate, the number of dwelling units in
     the Project which are or have been occupied, the number of
     units in the Project which were occupied by Lower-Income
     Tenants (or previously occupied by, and held available for
     rent to, Lower-Income Tenants), the number of units which were
     occupied by Eligible Tenants, the number of vacant units and
     such other information as is required by the form of
     certificate attached to the Regulatory Agreement as Exhibit B,
     as of the end of such three month period preceding the date of
     such certificate, upon request, leases, for each dwelling unit
     for which occupancy commenced by a Lower-Income Tenant during
     such three-month period and copies of the Income Computation
     Certificates (in the form attached as Exhibit C to the
     Regulatory Agreement);

               (6)  the Owner shall not discriminate on the basis
     of race, color, religion, sex, age, national origin, handicap,
     marital or familial status in the lease, use, or occupancy of
     the Project or in connection with the employment or
     application for employment of persons for the operation and
     management of the Project; and

               (7)  the Owner shall not discriminate against any
     tenant because he or she is a participant in a Section 8 rent
     subsidy program under the United States Housing Act of 1937,
     as amended.

     All determinations as to the status of Eligible Tenants shall
be made as of the time of such Eligible Tenant's application and
shall not be affected by subsequent changes in such Eligible
Tenant's income; provided, however, all determinations as to the
status of Lower-Income Tenants shall be made as of the time of such
Lower-Income Tenant's initial occupancy.

     SECTION 2.6.   Sale of Project.  Owner shall not, without the
prior written consent of the City (which consent shall not be
unreasonably witheld)  voluntarily sell, lease, exchange, assign,
convey, transfer or otherwise dispose of all or substantially all
of the Project and shall cause the release of all liens created
under the Original Loan Agreement, the Original Regulatory
Agreement and the deeds of trust related thereto on December 3,
1996.


                       (End of Article II)<PAGE>
                           ARTICLE III

             THE BONDS, BOND PROCEEDS, THE INDENTURE

     SECTION 3.1.   Issuance of Bonds.  Subject to the satisfaction
of and compliance with all of the provisions, covenants and
requirements of this Agreement, in order to provide funds for the
payment of the costs of the Refunding Project, the City has caused
the proceeds of the Bonds to be deposited with the Prior Trustee
for the purpose of paying a portion of the redemption price for the
Prior Bonds on December 3, 1996.

     SECTION 3.2.   Bond Proceeds; Investments.  The proceeds of
the Bonds and any earnings from any investments thereof, will be
held, invested and reinvested solely for the purposes and expended
for the purpose of paying a portion of the redemption price of the
Prior Bonds on December 3, 1996.

     SECTION 3.3.   Indenture Approval and Requirements.  The
execution of this Agreement concurrently with execution of the
Indenture by the City shall constitute conclusive evidence of
approval of the Indenture by the Owner.  Additionally, the Owner
agrees that whenever the Indenture is executed and by its terms
imposes a duty or obligation upon the Owner, such duty or
obligation shall be binding upon the Owner to the same extent as if
the Owner were an express party to the Indenture, and the Owner
hereby agrees to carry out and perform all of its obligations
thereunder.  No amendments to the Indenture may be made without the
prior written consent of the City, the Trustee, the Owner and of
the Guarantor.


                      (End of Article III)<PAGE>
                           ARTICLE IV

               THE LOAN, PREPAYMENTS, ASSIGNMENTS

     SECTION 4.1.   Loan by City. (a) The City, pursuant to the
terms of this Agreement, agrees to loan to the Owner the Loan in
the amount equal to the principal amount of the Bonds.  Upon
issuance of the Bonds, the full amount of the Loan hereunder shall
be deemed to be advanced to the Owner, shall be deposited under the
Indenture and shall be disbursed as provided in the Indenture. 
Concurrently with the issuance of the Bonds, and against deposit
and application of the proceeds of the Loan as authorized by the
Indenture, the Owner has executed and delivered this Agreement and
the Note to evidence the Owner's obligation to pay the amounts
specified under this Agreement and the Note.

     (b)  Concurrently with the execution and delivery of this
Agreement, the Owner shall cause the Guaranty Agreement to be
executed and delivered to the Trustee.

     (c)  The Owner agrees to make payments required under this
Agreement and the Note and to be liable therefor in such amounts,
and at such times, sufficient to pay, after applying all amounts
otherwise available for making such payments, all amounts required
to pay the principal of, premium, if any, and interest on the Bonds
when and as due and payable, whether at maturity, by optional or
mandatory redemption or by acceleration, all amounts required to be
paid pursuant to the Reimbursement Agreement, if any, and any and
all documentary stamp taxes or other taxes due and payable in
connection with the Loan and the Regulatory Agreement.

     (d)  The Owner agrees to pay all reasonable fees and expenses
(including reasonable counsel fees at all tribunal levels) of the
City, the Registrar (as defined in the Indenture), Bond Counsel and
the Trustee provided for herein or in the Indenture and to pay all
Cost of Issuance of the Bonds.

     SECTION 4.2.   Loan Payments. (a) The Owner covenants and
agrees to make payments hereunder directly to the Trustee, for
deposit to the Revenue Fund on the dates and in the amounts set
forth in the Note (except amounts to be paid pursuant to Sections
4.05, 4.06, 4.07 and 4.08 hereof, as to which different dates and
times for payment may be established by such Sections).  If the
Owner does not make the foregoing payments on the Loan in the
amounts and at the times referred to above (whether or not such
failure to pay has become an Event of Default under Section 7.01
hereof), the Trustee is required under Section 5.01 of the
Indenture to notify the Guarantor and make claim for such payment
under the Guaranty Agreement in the manner prescribed therein.

     (b)  Notwithstanding any provisions to the contrary in this
Agreement, in the event the day on which any payment or other
performance on the part of the Owner is scheduled to occur under
this Agreement is not a Business Day, then such payment or other
performance shall be required to occur at the same time on the next
preceding Business Day.

     SECTION 4.3.   Credits on Loan.  Notwithstanding any provision
contained in this Agreement or in the Indenture to the contrary:

     (a)  Moneys on deposit in the Revenue Fund, Interest Account
and Principal Account shall be credited against the obligations of
the Owner to make the payments required hereunder on the Loan as
the same become due; and

     (b)  The principal amount of Bonds purchased by the Owner and
delivered to the Trustee for cancellation, or purchased by the
Trustee and cancelled, shall be credited against the obligation of
the Owner to pay the principal of the Loan corresponding to the
principal amount of the Bonds delivered to the Trustee and
cancelled.

     SECTION 4.4.   Prepayment Generally.  No prepayment of the
Loan may be made except to the extent and in the manner expressly
permitted by this Agreement.  Upon receipt of written notice from
the Owner that a deposit is being made by the Owner for the purpose
of prepaying the Loan and hereby effecting the redemption of the
Bonds, the Trustee shall take such steps as may be required under
the Indenture to accomplish the redemption of the Bonds under the
redemption provisions of the Indenture.

     The Owner shall give written notice to the Trustee of its
election to prepay all or a portion of the Loan pursuant to
Sections 4.05 or 4.06 hereof, and the Owner shall be obligated to
make such prepayment after any notice of redemption of Bonds with
respect to such prepayment has been given by the Trustee.

     SECTION 4.5.   Optional Prepayment of Loan; Concurrent Bond
Redemption. 

     (a) The Owner shall have, and is hereby granted, the right and
option to prepay the Loan as a whole or in part on any date upon
payment to the Trustee, for deposit to the Revenue Fund prior to
the date established for redemption or prepayment of the Bonds, in
addition to amounts otherwise payable hereunder, an amount
sufficient to pay the interest on, premium, if any, and principal
of the Bonds so prepaid on such redemption date, or in the event
such redemption is not scheduled to occur on or prior to the next
Interest Payment Date, on each interest and principal payment date
for such Bonds on and prior to the redemption date.  There shall be
deemed to be such payment when there is placed in trust an amount
sufficient (including the known minimum yield available without
reinvestment for such purpose from Government Securities in which
such amount wholly or in part may be initially invested) to meet
all debt service requirements on such Bonds in the manner provided
in Article XII of the Indenture.  

     (b)  The Owner shall cause such prepayments to be on deposit
with the Trustee not later than one Business Day prior to the
redemption date established by the Trustee with respect to the
Bonds.

     SECTION 4.6.   Extraordinary Optional Prepayment.  The Loan is
subject to extraordinary optional prepayment, and the Owner shall
have the right to prepay the same upon the occurrence of any of the
following events, with respect to the Project, for a prepayment
price equal to the principal balance of the Loan then Outstanding
so prepaid, plus interest accrued to the date fixed for redemption
of the Bonds from such prepayment:

          (a)  The Loan then outstanding may be prepaid in
     whole if the Project is so demolished, destroyed or
     damaged that, in the judgment of the Owner, it cannot be
     restored or rebuilt with available funds to a profitable
     condition within a reasonable period of time as
     determined in accordance with Section 5.05 of this
     Agreement; or

          (b)  The Loan then outstanding may be prepaid in
     whole or in part if insurance proceeds or proceeds of any
     condemnation award with respect to the Project are not
     applied to restoration of the Project in accordance with
     Section 5.05 hereof.

     The Owner must exercise the option reserved in this Section
within six months following the date that a condition has occurred
which gives rise to a right of prepayment under this Section.  The
Owner shall cause such prepayments to be on deposit with the
Trustee not later than one Business Day prior to the date of
redemption established by the Trustee with respect to the Bonds.

     SECTION 4.7.   Provision of Alternate Security, Extraordinary
Mandatory Prepayment of Loan.  

     (a)   Within 60 days after the occurrence of any of the events
set forth in Section 7.01(e) or (f) hereof which have occurred and
are continuing, the Owner shall cause Alternate Security to be
provided to the Trustee, together with (i) an opinion of counsel to
the provider of such Alternate Security acceptable to the Trustee,
addressed to the Trustee and the City, stating that such Alternate
Security constitutes a legal, valid and binding obligation of such
provider and is enforceable in accordance with its terms (except to
the extent that the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting creditors' rights generally and by general principles of
equity which permit the exercise of judicial discretion and to the
extent that the enforceability of indemnification provisions
therein or to which such Alternate Security relates shall be
limited by applicable securities laws or public policy, (ii) an
opinion of counsel reasonably acceptable to the Trustee, addressed
to the Trustee and the City, stating that the provision of such
Alternate Security will not subject the Bonds or such Alternate
Security to the registration requirements of the Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as
amended, or the Indenture to qualification under the Trust
Indenture Act of 1939, as amended, (iii) an amount sufficient to
pay all costs incurred by the City and the Trustee in connection
with the provision of such Alternate Security, (iv) written
evidence from the rating agency or agencies whose rating on the
Bonds is then in effect that the credit rating assigned to the
Bonds after such provision is at least equal to the credit rating
assigned to the Bonds immediately prior to the occurrence of the
events set forth in Section 7.01(e) or (f) hereof, and (v) an
opinion of Bond Counsel, addressed to the City and the Trustee,
stating that the provision of Alternate Security is permitted under
this Agreement, the Indenture and the Act, and that such provision
will not have an adverse effect upon the exclusion from gross
income for federal income tax purposes of interest on the Bonds.

     (b)  If the Owner does not provide Alternate Security for the
Guaranty Agreement within the time prescribed hereby, the Owner
shall be required to prepay the Loan as a whole at a price equal to
the principal balance thereof, plus interest accrued thereon to the
date fixed for redemption of Bonds from such prepayment.  In such
event, the Bonds shall be called for redemption  on such date as
shall be selected by the Trustee, after consultation with the
Owner, but in no event later than 60 days following the failure to
provide Alternate Security, and the Owner shall cause sufficient
moneys to be on deposit with the Trustee at least one Business Day
prior to such date.

     (c)  The Loan is also subject to mandatory prepayment in whole
on the earliest practicable date selected by the Trustee within 180
days following the occurrence of a Determination of Taxability.  In
such event, the Bonds shall be redeemed at a redemption price equal
to 100% of the principal amount of the Bonds to be redeemed then
outstanding at the time of the Determination of Taxability plus
accrued interest to the redemption date.

     SECTION 4.8.   Usury. (a) Notwithstanding any provision of
this Agreement to the contrary, it is hereby agreed by and between
the City and the Owner that in no event shall the interest
contracted for, charged or received in connection with the Loan
made hereunder (including any other costs or considerations that
constitute interest under the laws of the State which are
contracted for, charged or received pursuant to this Agreement)
exceed the maximum rate of nonusurious interest allowed under the
laws of the State as presently in effect and to the extent an
increase is allowable by such laws, but in no event shall any
amount ever be paid or payable by the Owner greater than the amount
contracted for herein; and in the event the maturity of the Loan is
accelerated pursuant to Article VII hereof, or prepaid in
accordance with the provisions hereof requiring mandatory
prepayment, then such amounts that constitute payments of interest
on the Loan, together with any costs or considerations which
constitute interest under the laws of the State, may never exceed
an amount which would result in payment of interest at a rate in
excess of the nonusurious interest allowed by the laws of the State
or the United States to the extent applicable, as presently in
effect and to the extent an increase is allowable by such laws; and
excess interest, if any, provided for in this Agreement, or
otherwise, shall be cancelled automatically as of the date of such
acceleration or, if theretofore paid, shall be credited on the
Loan.

     (b)  To the extent permitted by law, interest contracted for,
charged or received on the Loan shall be allocated over the entire
term of the Loan to the end that interest paid on the Loan does not
exceed the maximum amount permitted to be paid thereon by law.

     SECTION 4.9.   Assignments to Trustee.  It is understood and
agreed that all right, title and interest of the City in and to
this Agreement (excepting the amounts payable to the City directly
for its own purposes under Sections 4.01(c), 5.02 and Section 6.01
hereof) are to be pledged and assigned by the City to the Trustee
as security for the Bonds under and pursuant to the Indenture.  The
Owner consents to such pledge and assignment.  The City directs the
Owner, and the Owner agrees, to pay or cause to be paid to the
Trustee at its principal corporate trust office all payments on the
Loan pursuant to this Agreement, and Trustee's Expenses (as defined
in the Indenture).

     SECTION 4.10.  Release of Owner from Covenants Hereunder. 
Notwithstanding anything to the contrary contained herein, in the
Regulatory Agreement or the Indenture, upon the sale, transfer or
disposition by the Owner of all of the Owner's interest in the
Project in accordance with the provisions of Section 2.06 hereof
and Section 10 of the Regulatory Agreement, the Owner shall be
released from its covenants and obligations hereunder with respect
to matters arising after such date of sale, transfer or
disposition.

     SECTION 4.11.  Assignment of Agreement by Owner.  This
Agreement may be assigned as a whole or in part, with the consent
of the City and the Guarantor, by the Owner subject, however, to
each of the following conditions:

          (a)  No assignment (other than pursuant to this
     Section) shall relieve the Owner from primary liability
     for any of its obligations hereunder, and, in the event
     of any such assignment, the Owner shall remain primarily
     liable for payments of the Loan payments pursuant to
     Section 4.02 of this Agreement and for performance and
     observance of the other agreements on its part herein
     provided to be performed and observed to the same extent
     as though no assignment had been made;

          (b)  In the event that this Agreement is assigned,
     as a whole or in part, the assignee shall agree to
     perform the obligations of the Owner hereunder to the
     extent of the interest assigned;

          (c)  The Owner shall within ten days prior to the
     making of any assignment furnish or cause to be furnished
     to the City and to the Trustee a true and complete copy
     of each such assignment and agreement to perform; and

          (d)  Upon the assignment of this Agreement as a
     whole by the Owner pursuant to and in accordance with
     Section 10 of the Regulatory Agreement, the Owner shall
     be relieved from all liability for any of its obligations
     hereunder with respect to matters arising after the date
     of assignment of this Agreement by the Owner.


                       (End of Article IV)<PAGE>
                            ARTICLE V

                      ADDITIONAL COVENANTS

     SECTION 5.1.   Permits and Licenses.  The Owner covenants and
agrees that in the operation of the Project it will use its best
efforts to comply with all federal, state and local statutes, laws,
lawful ordinances, building codes, regulations and rulings known by
it to apply to the Project.

     SECTION 5.2.   Payment for Extraordinary Services. (a) The
Owner hereby covenants and agrees to pay all reasonable fees of
Bond Counsel in connection with rendering opinions after the
issuance of the Bonds which are contemplated by the Indenture and
this Agreement.

     (b)  If, upon or after the occurrence of any default
hereunder, the City shall employ attorneys or incur other expenses
for the enforcement of performance or observance of any obligation
or agreement on the part of the Owner contained herein, the Owner
will on demand therefor reimburse the City for reasonable fees of
such attorneys and such other reasonable expenses so incurred
subject to the right of the Owner, here retained, to contest in
good faith, the necessity for and reasonableness of such fees and
expenses.

     (c)  The Owner hereby covenants and agrees to pay all
reasonable Trustee's Expenses (as defined in the Indenture) due and
payable pursuant to the Indenture and this Agreement, and assumes
all obligations of the City to pay all such reasonable Trustee's
Expenses.

     (d)  The Owner may prosecute or defend any action or
proceeding or take any other action involving any defaulting
supplier, contractor, subcontractor or surety thereof which the
Owner deems to be reasonably necessary, and in such event the City
agrees to cooperate fully with the Owner to the extent it may
lawfully do so, in any such action or proceeding.  Except as
provided in Section 6.01 hereof, all moneys recovered by way of
damages, refunds, adjustments or otherwise in connection with the
foregoing shall belong to the Owner.

     SECTION 5.3.   Taxes and Other Governmental Charges.  Owner
shall pay when due and before delinquency, all personal and real
property taxes and assessments, withholding and sales taxes, and
all other taxes and impositions of any kind or nature levied,
assessed or imposed upon the Project (collectively, "Taxes").  If
Owner, in good faith, disputes the amount or validity of any of
such Taxes, the Owner may contest the same by any lawful means at
no expense to the Trustee and the City, provided all of the
following conditions are satisfied:  (i) the Owner gives to the
Trustee and the City prior written notice of such contest; (b) the
Owner deposits with the Trustee an amount  sufficient to pay the
contested amount together with funds reasonably satisfactory to
Trustee to assure the payment of any penalties and interest
thereon; (iii) the Owner's interest in the Project, in the
Trustee's sole determination, is not jeopardized by such contest;
(iv) the Owner pays promptly from amounts held by the Trustee for
such purpose and any other monies provided by the Owner all amounts
ultimately determined or adjudged to be payable; and (v) said
contest is  prosecuted with due diligence and dispatch.

     SECTION 5.4.   Insurance.  Throughout the term of this
Agreement, the Owner agrees to keep the Project continuously
insured against the following risks, paying as the same become due
and payable all premiums with respect thereto:

          (i)  Insurance against loss or damage to the Project by
     fire, lightning, vandalism and malicious mischief, with
     uniform standard extended coverage endorsement limited only as
     may be provided in the standard form of extended coverage
     endorsement at the time in use in the State of Colorado, in an
     amount at least equal to 100% of the full insurable value
     thereof, but with deductible clauses in such amounts as are
     customary for facilities of similar size and character within
     the State of Colorado.

          (ii) Comprehensive general accident and public liability
     insurance (including coverage for all losses arising from the
     ownership or use of any vehicle) providing coverage limits
     (including deductible clauses) in an amount not less than
     $1,000,000.

          (iii)     During any period of renovation or alteration
     of the Project, so called "Builder's All-Risk Completed Value"
     or "Course of Construction" insurance policy and worker's
     compensation insurance covering all persons engaged in such
     construction, renovation or alteration.

          (iv) Fidelity insurance or bonds on those of its officers
     and employees who handle funds of the Owner, both in such
     amounts and to such extent as are customarily carried by
     organizations similar to the Owner and operating properties
     similar in size and character to the facilities of the Owner.

          (v)  Worker's compensation insurance, disability benefits
     insurance and such other forms of insurance as the Owner is
     required by law to provide with respect to the property of the
     Owner.

     All policies maintained by the Owner pursuant to this section
shall be taken out and maintained in generally recognized,
responsible insurance companies selected by the Owner and with
respect to the insurance policies required by subsections (i), (ii)
and (iii) of this Section shall name the Trustee as insured as its
interest may appear, provided that all insurance proceeds for
losses, except for workmen's compensation, fidelity insurance and
public liability insurance, shall be paid directly to the Trustee. 
Such policies or certificates of insurance shall provide that no
cancellation, reduction in amount, or material change in coverage
thereof shall be effective until at least 30 days after receipt of
written notice thereof by the Trustee.  Any such policies of
insurance may be provided by blanket policies maintained by the
Owner.

     The Owner shall deliver to the Trustee (i) upon the
commencement of the term of this Agreement, the originals or
certified copies thereof of all insurance policies (or certificates
thereof) which the Owner is required to maintain pursuant to this
Section, together with evidence as to the payment of all premiums
then due thereon and (ii) at least 30 days after the renewal of any
such policies evidence as to the renewal thereof, if then required
by this Section, and the payment of all premiums then due with
respect thereto.

     SECTION 5.5.   Application of Insurance and Condemnation
Proceeds.  All insurance proceeds received by the Owner pursuant to
Section 5.04(i) or (ii) of this Agreement and all condemnation
proceeds received by the Owner as the result of the condemnation of
all or any portion of the Project shall be  applied by the Owner to
the restoration of the Project or for prepayment of the Loan as
provided in this Agreement.   If any portion of the Project is
condemned or destroyed or damaged by fire or other casualty to such
extent that proceeds from such condemnation or the claim for loss
under the insurance policies required to be carried pursuant to
subsection (i) or (ii) of Section 5.04 hereof resulting from such
destruction or damage is $50,000 or less, the net proceeds of such
condemnation or insurance proceeds resulting from such claims for
losses shall be paid to the Owner and shall be used by the Owner to
either redeem Bonds or to repair, rebuild, or restore the property
damaged in the manner provided below in this Section.

     Unless the Owner shall have exercised its option to prepay the
Bonds in full pursuant to Section 4.06 hereof, if all or any
portion of the Project is condemned, destroyed or damaged (in whole
or in part) by fire or other casualty to such extent that such
condemnation proceeds or the claim for loss under the insurance
policies required to be carried pursuant to subsection (i) or (ii)
of Section 5.04 hereof resulting from such destruction or damage is
greater than $50,000, the Owner shall promptly give written notice
thereof to the Trustee.  All net condemnation proceeds or insurance
proceeds resulting from claims for losses of more than $50,000
(including the amount up to $50,000), shall, at the option of the
Owner, either be used to redeem or pay Bonds in the manner provided
in this Section or be held by the Trustee in a separate trust
account, whereupon (i) the Owner will promptly repair, rebuild, or
restore the property damaged or destroyed to substantially the same
utility and condition as it existed prior to such condemnation,
damage or destruction, with such changes, alterations, and
modifications (including the substitution and addition of other
property) as may be desired by the Owner and as will not impair the
Owner's ability to operate the Project in an efficient manner or
the utility of the Project, and (ii) the Trustee, upon receipt of
a consulting architect's certificate that such payment is required
for such purpose, will apply so much as may be necessary of the net
condemnation or insurance proceeds to payment of the costs of such
repair, rebuilding, or restoration as the work progresses. 
Notwithstanding the foregoing, the Trustee shall not disburse
condemnation or insurance proceeds for reconstruction of the
Project until the Owner shall have delivered to the Trustee a
written certification demonstrating that during the period of
reconstruction the Owner has reserved, or will otherwise have
condemnation or insurance proceeds available, in an amount
sufficient to accrue monthly payments to the Revenue Fund
sufficient to cover the principal and interest accruing on all
outstanding Bonds during such period. Any balance of such net
proceeds remaining after payment of all the costs of such repair,
rebuilding, or restoration shall be transferred, to the Interest
Fund and applied to the payment of interest on Bonds on the next
payment date or dates thereof.  In the event such net proceeds are
not sufficient to pay in full the costs of such repair, rebuilding,
or restoration, the Owner will nonetheless complete the work
thereof and will pay any costs thereof in excess of the amount of
said net proceeds.  The Owner shall not by reason of the payment of
such excess costs be entitled to any reimbursement from the
Trustee, or the owners of the Bonds or any postponement, abatement,
or diminution of the payments required to be made under the
Indenture.

     All net proceeds of condemnation or insurance resulting from
claims for losses specified in the first sentences of the two
preceding paragraphs may be used to redeem or pay Bonds; provided
(i) all of the Bonds are to be redeemed in accordance with the
Indenture upon exercise of the option to prepay the Bonds in full
provided for in Article IV hereof or (ii) in the event that less
than all of the Bonds are to be redeemed, the Owner shall furnish
to the Trustee a consulting architect's certificate stating (i)
that the property forming a part of the Project damaged or
destroyed is not essential to the Owner's use or occupancy of the
Project, or (ii) that Project has been restored to a condition
substantially equivalent to its utility and condition prior to the
damage or destruction, or (iii) that improvements have been
acquired which are suitable for operation as a low-income rental
housing project on the Project Site.  Such other improvements shall
together with the remaining improvements after the damage and
destruction be of substantially the same utility as the Project
prior to the damage and destruction.

     The Owner shall notify S&P in writing within 10 business days
of any condemnation action instituted against any portion of the
Project or any casualty loss, which notice shall describe the
nature of the condemnation action or the extent of the damage to
the Project.

     Notwithstanding any other provision of this Agreement to the
contrary, the Owner shall certify to the Trustee within 120 days of
receipt of any condemnation or insurance proceeds with respect to
the Project whether it will proceed to repair, rebuild or restore
the Project or apply such proceeds to the redemption of the Bonds. 

     SECTION 5.6.   General Tax Covenant.  The Owner covenants that
it will comply with the requirements and conditions of the Tax
Certificate and the Regulatory Agreement.  Without limiting the
foregoing, the Owner covenants that, notwithstanding any provision
of this Agreement or the rights of the Owner hereunder, it will not
take, or permit to be taken on its behalf, any action which would
cause interest on the Bonds not to be excluded from gross income
for federal income tax purposes and that it will take such
reasonable action as may be necessary to continue such exclusion
from gross income, including, without limitation, (a) compliance
with the requirements contained in Section 2.04 hereof; (b) the
preparation and filing of any statements required to be filed by it
in order to maintain such exclusions; and (c) the payment to the
United States of any amount required to be paid by the City or the
Owner pursuant to Section 148(f) of the Code and the regulations
thereunder, including, to the extent applicable, Section 1.148-3 of
the Treasury Regulations on Income Tax or subsequent applicable
Treasury Regulations, at the times, in the amounts and at the
places required thereby in order to maintain the exclusion from
gross income of interest on the Bonds for federal income tax
purposes; and the Owner hereby irrevocably authorizes and directs
the City and the Trustee (and any other agent designated by the
City) to make payment of such amounts from funds of the Owner, if
any, held by the City, the Trustee (under the Indenture), or any
agent of the City or the Trustee.   The Owner hereby covenants to
deposit all amounts required to be deposited to the Rebate Fund
necessary to continue the exclusion from gross income of interest
on the Bonds and hereby agrees to direct the Trustee's deposit of
such moneys as provided in Section 5.07 of the Indenture. 





                       (End of Article V)<PAGE>
                           ARTICLE VI

               INDEMNIFICATION OF CITY AND TRUSTEE

     SECTION 6.1.   Indemnification of City and Trustee.  The Owner
releases the City from, and covenants and agrees that the City
shall not be liable for, and covenants and agrees, to the extent
permitted by law, to indemnify and hold harmless the City and its
officers, employees and agents from and against, any and all
losses, claims, damages, liabilities or expenses, of every
conceivable kind, character and nature whatsoever arising out of,
resulting from or in any way connected with (a) the Project, or the
conditions, occupancy, use, possession, conduct or management of,
or work done in or about, or from the planning, design or
improvement of the Project or any part thereof; (b) the issuance of
any Bonds or any certifications or representations made in
connection therewith and the carrying out of any of the
transactions contemplated by the Bonds and this Agreement; (c) the
Trustee's acceptance or administration of the trusts under the
Indenture, or the exercise or performance of any of its powers or
duties under the Indenture; or (d) any untrue statement or alleged
untrue statement of any material fact or omission or alleged
omission to state a material fact necessary to make the statements
made, in light of the circumstances under which they were made, not
misleading, in any official statement or other offering circular
utilized by the City or any underwriter or placement agent in
connection with the sale of any Bonds or in connection with any
future remarketing thereof; provided that such indemnity shall not
be required for damages that result from gross negligence or
willful misconduct on the part of the City.  Further, the Owner
agrees to indemnify and hold harmless the Trustee, its officers,
employees and agents, against any loss, liability or expenses
incurred without negligence or bad faith on its part, arising out
of or in connection with any act or omission of the Owner.  The
indemnity required by this Section 6.01 shall be only to the extent
that any loss sustained by the City or the Trustee exceeds the net
proceeds the City or the Trustee receives from any insurance
carried with respect to the loss sustained.  In the event that any
action or proceeding is brought against the City, the Trustee or
any of their officers, employees, attorneys or agents with respect
to which indemnity may be sought hereunder, the Owner, upon written
notice from the indemnified party, shall assume the investigation
and defense thereof, including the employment of counsel
(reasonably acceptable to the indemnified party) and the payment of
all expenses.  Each indemnified party shall have the right to
employ separate counsel in any such action or proceedings and to
participate in the investigation and defense thereof, and the Owner
shall pay the reasonable fees and expenses of such separate
counsel, provided, however, that unless such separate counsel is
employed with the approval and consent of the Owner, the Owner
shall not be required to pay the fees and expenses of such separate
counsel.  The Owner shall not unreasonably withhold such approval
and consent.  The provisions of this Section 6.01 shall survive the
retirement of the Bonds.

                       (End of Article VI)<PAGE>
                           ARTICLE VII

                  BREACH OF COVENANTS, REMEDIES

     SECTION 7.1.   Event of Default.  An "Event of Default" shall
be deemed to have occurred under this Agreement if:

          (a)  Any amount required to be paid by Section
     4.02(a) hereof (taking into account any credits described
     in Section 4.03 hereof) is not paid to the Trustee
     (either by the Owner or the Guarantor) when due and such
     amount remains unpaid at 5:00 p.m., New York time, on
     such Interest Payment Date or Purchase Date; or

          (b)  Any amount required to be paid by Sections
     4.05, 4.06 or 4.07 hereof (taking into account any
     credits described in Section 4.03 hereof) is not paid to
     the Trustee (either by the Owner or the Guarantor) on the
     date and at the time required for payment thereof in the
     applicable Section hereof and such amounts remain unpaid
     at 5:00 p.m., New York time, on the date required to be
     applied to make payments of principal of, premium, if
     any, and interest on the Bonds under the Indenture; or

          (c)  Failure by the Owner to observe any other of
     its covenants hereunder or under the Regulatory Agreement
     for a period of 30 days after written notice has been
     given to the Owner by the City or the Trustee; provided,
     that if such failure is of such nature that it can be
     corrected within a reasonable time (as agreed to by the
     Trustee), but not within such period, the same shall not
     constitute an Event of Default so long as, in the
     judgment of the Trustee, the Owner institutes prompt
     corrective action and is diligently pursuing same; or
     
          (d)  The failure of the Guarantor to make payments
     under the Guaranty Agreement within the time provided for
     therein; or

          (e)  The Guarantor shall file a voluntary petition
     in bankruptcy, or shall be adjudicated bankrupt or
     insolvent, or shall file any petition or agreement
     seeking any reorganization, composition, readjustment,
     liquidation or similar relief for itself under any
     present or future statutes, laws or regulations or shall
     seek or consent to or acquiesce in the appointment of any
     trustee, receiver or liquidator of the Guarantor or of
     all or any substantial part of its properties, or shall
     make any general assignment for the benefit of creditors,
     or shall admit in writing its inability to pay its debts
     generally as they become due; or

          (f)  A petition shall be filed against the Guarantor
     seeking any reorganization, composition, readjustment,
     liquidation or similar relief under any present or future
     statute, law or regulation and shall remain undismissed
     or unstayed for an aggregate of ninety days, or if any
     trustee, receiver or liquidator of the Guarantor or of
     all or any substantial part of its properties shall be
     appointed without the consent or acquiescence of the
     Guarantor and such appointment shall remain undismissed
     or unstayed for an aggregate of ninety days (whether or
     not consecutive); or

          (g)  Any "Event of Default" occurs under the
     Indenture and is not cured prior to a declaration of
     acceleration under Section 8.01 thereof; or

          (h)  Any Event of Default (as defined therein)
     occurs under the Reimbursement Agreement, and the
     Guarantor in its sole discretion notifies the Trustee
     thereof and instructs the Trustee to declare an Event of
     Default hereunder.

     The occurrences set forth in Section 7.01(e) and (f) above
shall not constitute Events of Default hereunder if the Owner
provides Alternate Security for the Guaranty Agreement within 60
days subsequent to the happening of such occurrence pursuant to
Section 4.07 hereof.  In the event the Owner fails to provide such
Alternate Security, no declaration of acceleration shall be made by
the Trustee, and the Loan shall be prepaid mandatorily as provided
in Section 4.07 hereof.

     SECTION 7.2.   Remedies for Failure to Perform. (a) Upon the
occurrence of an Event of Default as provided in Section 7.01(a),
(b), (c), (d) and (g) above, all amounts due under this Agreement
shall be immediately due and payable and the date of payment
thereof shall be as specified in a notice of acceleration which
shall be given promptly by the Trustee to the Owner.  A copy of
such notice of acceleration shall be given to the Guarantor
simultaneously with such notice to the Owner, and a demand for
payment shall be made by the Trustee under the Guaranty Agreement
in an amount sufficient to pay principal of and interest on the
Bonds to the date of payment thereof.

     (b)  Upon the occurrence of an Event of Default as provided in
Section 7.01(h) above, all amounts due under this Agreement shall
be immediately due and payable if the Trustee receives written
direction from the Guarantor to accelerate such amounts, and the
date of payment thereof shall be as specified in a notice of
acceleration which shall be given promptly by the Trustee to the
Owner.  A copy of such notice of acceleration shall be given to the
Guarantor simultaneously with such notice to the Owner, and a
demand for payment shall be made by the Trustee under the Guaranty
Agreement in an amount sufficient to pay principal of and interest
on the Bonds to the date of payment thereof.

     (c)  Upon the occurrence of an Event of Default specified in
Section 7.01(c), (g) or (h) hereof, if the action or non-action
which resulted in such Event of Default is cured by or on behalf of
the Owner prior to the time the notice of acceleration of the Bonds
is given by the Trustee, and if, as to Section 7.01(c), the Trustee
receives an opinion of Bond Counsel to the effect that, following
such cure and assuming no recurrence of such default, no material
risk exists that interest on the Bonds will be subject to federal
income taxation, then the acceleration of all amounts due under
this Agreement shall be rescinded, the demand on the Guarantor
shall be deemed to be null and void and the parties shall be
restored to the same position as though no such Event of Default
had occurred; provided, that any acceleration caused by the Event
of Default specified in Section 7.01(h) above shall not be
rescinded except upon receipt by the Trustee of written
instructions to such effect from the Guarantor.

     (d)  Upon the occurrence of an Event of Default specified in
paragraphs (a), (b) and (d) above, if there is paid to or deposited
with the Trustee, prior to the time the notice of acceleration of
the Bonds is given by the Trustee under the Indenture, a sum
sufficient to pay all overdue amounts which resulted in such Event
of Default and Trustee's Expenses, if any, then the acceleration of
all amounts due under this Agreement shall be rescinded, the demand
on the Guarantor shall be deemed to be null and void and the
parties shall be restored to the same position as though no such
Event of Default had occurred.

     SECTION 7.3.   Discontinuance of Proceedings.  In case any
proceeding taken by the City or its assigns on account of any
failure to perform under this Agreement shall have been
discontinued or determined adversely to the City or its assigns,
then and in every case the City or its assigns and the Owner shall
be restored to their former positions and rights hereunder,
respectively, and all rights, remedies and powers of the City or
its assigns shall continue as though no such proceeding had been
taken.

     SECTION 7.4.   Remedies Cumulative.  No remedy conferred upon
or reserved to the City or the Trustee by this Agreement is
intended to be exclusive of any other available remedy or remedies,
but each and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Agreement or the
Indenture or now or hereafter existing at law or in equity.  No
delay or omission to exercise any right or power accruing upon any
failure to perform under this Article shall impair any such right
or power or shall be construed to be a waiver thereof.  In order to
entitle the City or the Trustee to exercise any remedy reserved to
it in this Article, it shall not be necessary to give any notice
other than as otherwise specified in this Agreement.

     SECTION 7.5.   Waiver of Event of Default.  In case of the
occurrence of an Event of Default and either prior to giving notice
of acceleration of the maturity of the Bonds by the Trustee or
annulment of a declaration of acceleration pursuant to the
Indenture, the Owner shall have paid or caused to be paid all
amounts then due and payable under this Agreement and the Note and
shall perform all other obligations in respect of which it is in
default under this Agreement, and shall have paid the reasonable
charges and expenses of the City and the Trustee, and if as to the
Event of Default specified in paragraph (c) of Section 7.01 hereof,
the Trustee receives the opinion of Bond Counsel to the effect
that, following such cure, and assuming no recurrence of such
default, interest on the Bonds will not be subject to federal
income taxation as the result of such default, then such event of
default shall be waived and annulled, and the remedies invoked
under this Agreement shall be rescinded, but no such waiver or
annulment shall extend to or affect any subsequent event of default
or impair any right or remedy consequent thereon.


                      (End of Article VII)<PAGE>
                          ARTICLE VIII

                          MISCELLANEOUS

     SECTION 8.1.   Amounts Remaining in Funds and Accounts.  Any
amounts remaining in any fund or account established under the
Indenture after payment of the Bonds in full including interest and
premium, if any, thereon, or provision for payment thereof having
been made in accordance with the provisions of the Indenture, and
payment of all other reasonable and necessary obligations owing to
the City, the Registrar and the Trustee under this Agreement or the
Indenture, shall be paid by the Trustee in accordance with Section
12.01 of the Indenture.

     SECTION 8.2.   Limited Obligation of City.  The City shall not
be obligated to pay the principal of, or premium, if any, or
interest on the Bonds, except from revenues arising from the pledge
and assignment of the Loan and the other funds held or set aside in
trust under the Indenture.  The Owner hereby acknowledges that the
City's sole source of moneys to repay the Bonds and to refund the
Prior Bonds will be provided by the proceeds of the Bonds and
payments made by the Owner pursuant to this Agreement, together
with other revenues, including any drawings under the Guaranty
Agreement or investment income on certain funds and accounts held
by the Trustee under the Indenture, and hereby confirms that
amounts available to pay all principal of, and premium, if any, and
interest on the Bonds as the same shall become due (whether by
maturity, redemption, acceleration or otherwise), have been
calculated to be at all times sufficient for such purpose.

     Any obligation or liability of the City created by or arising
out of this Agreement (including without limitation any liability
created by or arising out of the representations, warranties or
covenants set forth herein or otherwise) shall not impose a debt or
pecuniary liability upon the City or a charge upon its general
credit or taxing powers, but shall be payable solely out of the
above-described revenues.  Neither the issuance of the Bonds nor
the delivery of this Agreement shall, directly or indirectly or
contingently, obligate the City to levy any form of taxation
therefor or to make any appropriation for their payment.  Nothing
in the Bonds or in the Indenture or this Agreement or the
proceedings of the City authorizing the Bonds or in the Act or in
any other related document shall be construed to authorize the City
to create a debt of the City within the meaning of any
constitutional or statutory provision of the State.  No breach of
any pledge, obligation or agreement of the City hereunder may
impose any pecuniary liability upon the City or any charge upon its
general credit or against its taxing power.

     SECTION 8.3.   Payments by Guarantor.  The Guarantor shall, to
the extent of any payments made by it pursuant to the Guaranty
Agreement, be subrogated to all rights of the City or its assigns
(including, without limitation, the Trustee) as to all obligations
of the Owner with respect to which such payments shall be made by
the Guarantor, but, so long as any of the Bonds remain Outstanding
under the terms of the Indenture, such right of subrogation on the
part of the Guarantor shall be in all respects subordinate to all
rights and claims of the Registered Owners, the Trustee and the
City for all payments which shall be or become due and payable
under the Indenture or otherwise arising under this Agreement, the
Indenture, the Note, the Regulatory Agreement or the Bonds.  The
Trustee will, upon request, execute and deliver any instrument
reasonably requested by the Guarantor to evidence such subrogation
and the Trustee shall assign its rights in any obligations of the
Owner with respect to which payment of the entire principal balance
and accrued interest thereon shall be made by the Guarantor,
provided such amounts are sufficient to cause defeasance of the
Indenture in accordance with Section 12.01 thereof.

     SECTION 8.4.   Amendments, Changes or Modifications to Loan
Agreement.  This Agreement may be amended, changed or modified only
subject to the requirements for and limitations on such amendments,
changes or modifications set forth in the Indenture.

     SECTION 8.5.   Rights of the Guarantor; References to the
Guarantor.  Notwithstanding anything contained herein to the
contrary, all provisions hereof regarding consents, approvals,
directions, waivers, appointments, requests or other actions by the
Guarantor shall be deemed not to require or permit such consents,
approvals, directions, waivers, appointments, requests or other
actions and shall be read as if the Guarantor were not mentioned
herein (a) during any period during which there is a payment
default under the Guaranty Agreement, or (b) after the Guaranty
Agreement shall at any time for any reason cease to be valid and
binding on the Guarantor, or shall be declared to be null and void
by final judgment of a court of competent jurisdiction; provided,
however, that the payment of amounts due to the Guarantor pursuant
to the terms hereof shall continue in full force and effect.  The
foregoing shall not affect any other rights of the Guarantor.

     SECTION 8.6.   Payment.  At such time as the principal of,
premium, if any, and interest on all Bonds outstanding under the
Indenture shall have been paid, or shall be deemed to be paid in
accordance with the Indenture, and all other sums payable by the
Owner under this Agreement and the Indenture shall have been paid,
the Loan shall be deemed to be fully paid and the Owner upon
request is entitled to receive acknowledgment of such payment in
full from the Trustee.

     SECTION 8.7.   Counterparts.  This Agreement may be executed
in any number of counterparts, each of which, when so executed and
delivered, shall be an original; but such counterparts shall
together constitute but one and the same Agreement, and, in making
proof of this Agreement, it shall not be necessary to produce or
account for more than one such counterpart.

     SECTION 8.8.   Severability.  If any clause, provision or
section of this Agreement shall be held illegal or invalid by any
court, the invalidity of such provisions or sections shall not
affect any other provisions or sections hereof, and this Agreement
shall be construed and enforced to the end that the transactions
contemplated hereby be effected and the obligations contemplated
hereby be enforced, as if such illegal or invalid clause, provision
or section had not been contained herein.

     SECTION 8.9.   Term of Agreement.  This Agreement shall be in
full force and effect from the date hereof and shall continue in
effect (i) so long as any Bonds are outstanding, or (ii) until 365
days have elapsed after the Owner has made any payments under this
Agreement during which no petition in bankruptcy is filed by or
against the Owner under Title 11 of the United States Code during
such 365 day period, or (iii) so long as Trustee holds any moneys
under the Indenture, whichever is later.  All representations and
certifications by the Owner set forth in Article II hereof and all
provisions relating to the payment of any amounts due hereunder
(including any amounts due pursuant to Article VI hereof) shall
survive the termination of this Agreement.

     SECTION 8.10.  Notice of Changes in Fact.  Promptly after the
Owner becomes aware of the same, the Owner will notify the Trustee
of (i) any change in any material fact or circumstance represented
or warranted by the Owner in this Agreement or in connection with
the issuance of the Bonds, and (ii) any default or event which,
with notice or lapse of time or both, could become a default under
this Agreement, or the Indenture, specifying in each case the
nature thereof and what action the Owner has taken, is taking,
and/or proposes to take with respect thereto.

     SECTION 8.11.  Notices.  Any notices or other communications
required or permitted hereunder shall be sufficiently given if
delivered personally or sent registered or certified mail, postage
prepaid, to Owner, Wellsford Marks West Corp., c/o Wellsford
Residential Property Trust, 610 Fifth Avenue, New York, New York
10020, Attention: President, with a copy to Wellsford Marks West
Corp., 370 17th Street, Suite 3100, Denver, Colorado, Attention:
President; to the Guarantor, Wellsford Residential Property Trust,
610 Fifth Avenue, New York, New York 10020, Attention: Chief
Financial Officer; to the City, City of Englewood, Colorado, 3400
South Elati, Englewood, Colorado 80110, Attention: City Attorney;
to the Trustee, American National Bank and Trust Company of
Chicago, 33 North LaSalle Street, 13th Floor, Chicago, Illinois
60690, Attention: Corporate Trust Department; or at such other
address as shall be furnished in writing by any such party to the
others, and shall be deemed to have been given as of the date so
delivered or deposited in the United States mail.

     SECTION 8.12.  Provision of Alternate Security.  The Owner
hereby is authorized to provide Alternate Security for the Guaranty
Agreement or for Alternate Security previously provided at any time
after providing the City and the Trustee with the following: (i) an
opinion of counsel to the provider of such Alternate Security
acceptable to the Trustee, addressed to the Trustee and the City,
stating that such Alternate Security constitutes a legal, valid and
binding obligation of such provider and is enforceable in
accordance with its terms (except to the extent that the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting creditors'
rights generally and by general principles of equity which permit
the exercise of judicial discretion and to the extent that the
enforceability of indemnification provisions therein or to which
such Alternate Security relates shall be limited by applicable
securities laws or public policy), (ii) an opinion of counsel
reasonably acceptable to the Trustee, addressed to the Trustee and
the City, stating that the provision of such Alternate Security
will not subject the Bonds or such Alternate Security to the
registration requirements of the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended, or the
Indenture to qualification under the Trust Indenture Act of 1939,
as amended, (iii) an amount sufficient to pay all costs incurred by
the City and the Trustee in connection with the provision of such
Alternate Security (including without limitations, reasonable
counsels' fees and expenses), (iv) written confirmation from the
rating agency or agencies whose rating on the Bonds is then in
effect, that the rating on the Bonds on the date immediately
succeeding the substitution will be at least equal to the rating in
effect immediately prior to such substitution, but in no event
shall such rating be less than investment grade (e.g., rated "AAA,"
"AA," "A" or "BBB" by S&P, or the equivalent rating category
assigned by another nationally recognized rating agency, and (v) an
opinion of Bond Counsel, addressed to the City and the Trustee,
stating that the provision of the Alternate Security is permitted
under this Agreement, the Indenture and the Act, and that such
provision will not have an adverse effect upon the tax exempt
status of the interest on the Bonds.

     SECTION 8.13.  Guarantor Debt; Mandatory Provision of
Alternate Security.  In the event the original Guarantor (Wellsford
Residential Property Trust) shall fail to comply with the debt
covenants set forth in Section 1.10 of the Guaranty, the Guarantor
shall, or the Owner shall if the Guarantor does not, promptly
report such event to the Trustee in writing.  In such event the
Owner may cause Alternate Security to be delivered to the Trustee. 
Such Alternate Security shall be delivered not later than 60 days
after the receipt of such written notice together with (i) an
opinion of counsel to the provider of such Alternate Security
acceptable to the Trustee, addressed to the Trustee and the City,
stating that such Alternate Security constitutes a legal, valid and
binding obligation of such provider and is enforceable in
accordance with its terms (except to the extent that the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting creditors'
rights generally and by general principles of equity which permit
the exercise of judicial discretion and to the extent that the
enforceability of indemnification provisions therein or to which
such Alternate Security relates shall be limited by applicable
securities laws or public policy, (ii) an opinion of counsel
reasonably acceptable to the Trustee, addressed to the Trustee and
the City, stating that the provision of such Alternate Security
will not subject the Bonds or such Alternate Security to the
registration requirements of the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended, or the
Indenture to qualification under the Trust Indenture Act of 1939,
as amended, (iii) an amount sufficient to pay all costs incurred by
the City and the Trustee in connection with the provision of such
Alternate Security, (iv) written evidence from the rating agency or
agencies whose rating on the Bonds is then in effect that the
credit rating assigned to the Bonds after such provision is at
least equal to the credit rating assigned to the Bonds immediately
prior to the occurrence of the Guarantor's failure to meet the debt
tests set forth in Section __ of the Guaranty, but in no event
shall such rating be less than investment grade (e.g., rated "AAA,"
"AA," "A" or "BBB" by S&P), or the equivalent rating category
assigned by another nationally recognized rating agency, and (v) an
opinion of Bond Counsel, addressed to the City and the Trustee,
stating that the provision of Alternate Security is permitted under
this Agreement, the Indenture and the Act, and that such provision
will not have an adverse effect upon the exclusion from gross
income for federal income tax purposes of interest on the Bonds. 
In the event such Alternate Security is not delivered to the
Trustee within such 60 day period or the Guarantor shall certify it
then complies with the tests set forth in Section 1.10 of the
Guaranty, the Trustee shall treat such event as a covenant default
under this Agreement and shall take such action as is permitted
under Article VII hereof.

     SECTION 8.14.  Applicable Law.  The substantive laws of the
State shall govern this Agreement.

     IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement as of October 1, 1996.

                                   CITY OF ENGLEWOOD, COLORADO



                                   By:/s/ Thomas J. Burns
                                      ---------------------
                                             Mayor
                                        Thomas J. Burns
(SEAL)

Attest:


/s/ Loucrishia A. Ellis
          City Clerk



                                    WELLSFORD MARKS WEST CORP.



                                   By:/s/ David M. Strong    
                                          Vice President


<PAGE>
                         ACKNOWLEDGMENTS


STATE OF COLORADO             )
                              )  SS.
CITY OF ENGLEWOOD             )

     The foregoing instrument was acknowledged before me this 23rd
day of October, 1996, by Thomas J. Burns, as Mayor of the CITY OF
ENGLEWOOD, COLORADO, a municipal corporation, and by Loucrishia A.
Ellis, as City Clerk of the CITY OF ENGLEWOOD, COLORADO, a
municipal corporation.

     WITNESS my hand and official seal.


                                   /s/ Brenda J. Castle         
                                       -------------------------
                                     Notary Public for the State
                                             of Colorado

     My commission expires 1-3-00.





STATE OF COLORADO             )
                              )  SS.
CITY OF ENGLEWOOD             )

     The foregoing instrument was acknowledged before me this 25th
day of October, 1996, by David M. Strong, as Vice President of
WELLSFORD MARKS WEST CORP., a Colorado corporation, and by
_________________, as Secretary of WELLSFORD MARKS WEST CORP., a
Colorado corporation.

     WITNESS my hand and official seal.

(SEAL)

                                   /s/ Roberta Kay Peterson     
                                       -----------------------
                                     Notary Public for the State
                                             of Colorado
     My commission expires 6-21-98.
<PAGE>
                            EXHIBIT A


                          FORM OF NOTE
                                                 October 25, 1996

     FOR VALUE RECEIVED, Wellsford Marks West Corp., a Colorado
corporation (the "Owner"), does hereby promise to pay to the order
of the City of Englewood, Colorado (the "City") at the principal
corporate trust office of American National Bank and Trust Company
of Chicago, Chicago, Illinois, or any successor trustee (the
"Trustee") acting as such under that certain Indenture of Trust
dated as of October 1, 1996, by and between the City and the
Trustee (the "Indenture"), in lawful money of the United States of
America, the principal sum of Eleven Million Two Hundred Thousand
and No/100 Dollars ($11,200,000) on November 1, 2026, and to pay
interest on the unpaid principal amount hereof, in like money, from
October 1, 1996 at such office at the rate, and to the funds and
accounts specified in Sections 4.01 and 4.02 of that certain Loan
Agreement dated as of October 1, 1996 between the City and the
Owner (hereinafter referred to as the "Agreement").  The Owner
agrees to pay interest on the outstanding principal amount hereof
in semi-annual installments on the business day preceding each June
1 and December 1 (each an "Interest Payment Date"), commencing on
June 1, 1997, until the maturity hereof; provided, however, that
the installment due and payable on June 1, 1997 shall be reduced by
the interest paid by the original purchasers of the Bonds on the
date hereof; and provided further, however, that each installment
due and payable shall be reduced by the amount of investment
earnings in the Revenue Fund (as defined in the Indenture) the
available for payment of interest on the Bonds.  In addition, the
Owner shall pay semiannually on each June 1 and December 1,
commencing on June 1, 1997, an amount equal to 1/2 of the annual
fee payable to the Trustee, or to the fees of the City, if any, in
full satisfaction of its obligations to the Trustee and to the City
for such fees.  In addition the Owner shall pay all additional
amounts set forth in Section 4.01(c) of the Agreement as they shall
arise upon written notice to the Owner.

     ANYTHING HEREIN or in the Agreement to the contrary
notwithstanding, it is hereby agreed by and between the City and
the Owner that in no event shall the interest contracted for,
charged or received in connection with the loan made hereunder
(including any other costs or considerations that constitute
interest under the laws of the State of Colorado (the "State")
which are contracted for, charged or received pursuant hereto and
pursuant to the Agreement) exceed the maximum rate of nonusurious
interest allowed under the laws of the State as presently in effect
and to the extent an increase is allowable by such laws, but in no
event shall any amount ever be paid or payable by the Owner greater
than the amount contracted for herein; and in the event the
maturity of the loan is accelerated pursuant to Article VII of the
Agreement, or prepaid in accordance with the provisions thereof
requiring mandatory prepayment, then such amounts that constitute
payments of interest on the loan, together with any costs or
considerations which constitute interest under the laws of the
State, may never exceed an amount which would result in payment of
interest at a rate in excess of the nonusurious interest allowed by
the laws of the State or the United States to the extent
applicable, as presently in effect and to the extent an increase is
allowable by such laws; and excess interest, if any, provided for
herein and in the Agreement, or otherwise, shall be cancelled
automatically as of the date of such acceleration or, if
theretofore paid, shall be credited on the loan.

     ALL SUMS paid hereon shall be applied, as applicable, first to
the satisfaction of unpaid accrued interest and the balance to the
unpaid principal and premium, if any.

     THIS NOTE is subject to all of the terms, conditions, and
provisions of the Agreement, including those respecting prepayment
and the acceleration of maturity and is further subject to all of
the terms, conditions, and provisions of the Indenture, all as
provided in the Agreement.  The outstanding principal hereof is
subject to acceleration at the same time or times and under the
same terms and conditions, and with the same notice, if any, as
provided under the Indenture for the acceleration of payment of the
bonds designated City of Englewood, Colorado, Multifamily Housing
Revenue Refunding Bonds, (Marks Apartments Project) Series 1996"
(the "Bonds").  Notwithstanding anything to the contrary contained
herein or in the Agreement, the payments in respect of the Loan
shall be sufficient to pay, when due (whether at stated maturity,
upon redemption prior to maturity, upon acceleration of stated
maturity, or otherwise), the principal of, premium, if any, and
interest on the Bonds at any time outstanding, and, to the extent
permitted by law, interest on any overdue payments.

     THE OWNER hereby acknowledges that, pursuant to the Indenture,
the City is collaterally assigning to the Trustee all of the City's
right, title, and interest in and to this Note.

     THIS NOTE is a contract made under and shall be construed in
accordance with and governed by the laws of the State of Colorado
entered into as of October 25, 1996.

                                   WELLSFORD MARKS WEST CORP.



                                        By:_____________________ 
                                             President

                                        By:_____________________
                                             President<PAGE>
                            EXHIBIT B


     The multifamily housing project located on the real property
described below, consisting of 12 apartment buildings which contain
in aggregate 280 units.  The street address of the project is 1701
East Hampden Avenue, Englewood, Colorado.  


          Lot 1, Block 1, The Marks Subdivision, Filing
          No. 2, County of Arapahoe, State of Colorado

          However, Together with Beneficial Easement
          rights for ingress and egress as contained in
          Agreement recorded August 20, 1973, in
          Book 2160 at Page 242.