March 30, 2000



United States
Securities and Exchange Commission
Washington, D.C.  20549


RE:   Angeles Income Properties 6
      Form 10-KSB
      File No. 0-16210


To Whom it May Concern:

The  accompanying  Form 10-KSB for the year ended  December 31, 1999 describes a
change in the method of  accounting to  capitalize  exterior  painting and major
landscaping,   which  would  have  been  expensed  under  the  old  policy.  The
Partnership believes that this accounting principle change is preferable because
it  provides a better  matching  of  expenses  with the  related  benefit of the
expenditures and it is consistent with industry practice and the policies of the
General Partner.

Please do not hesitate to contact the undersigned with any questions or comments
that you might have.

Very truly yours,



Stephen Waters
Real Estate Controller
<PAGE>

               FORM 10-KSB--ANNUAL OR TRANSITIONAL REPORT UNDER

                               SECTION 13 OR 15(d)

                                   Form 10-KSB

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

      [No Fee Required]

                 For the fiscal year ended December 31, 1999

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934
      [No Fee Required]

             For the transition period from _________to _________

                         Commission file number 0-16210

                      ANGELES INCOME PROPERTIES, LTD. 6
                (Name of small business issuer in its charter)

         California                                               95-4106139
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)

                          55 Beattie Place, PO Box 1089
                       Greenville, South Carolina 29602
                   (Address of principal executive offices)

                   Issuer's telephone number (864) 239-1000

        Securities registered under Section 12(b) of the Exchange Act:

                                      None

        Securities registered under Section 12(g) of the Exchange Act:

                      Units of Limited Partnership Interest

                                (Title of class)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days.Yes X  No___

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the best of the  registrant's  knowledge  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [ ]

State issuer's revenues for its most recent fiscal year.  $5,646,000

State the aggregate  market value of the voting  partnership  interests  held by
non-affiliates  computed  by  reference  to the price at which  the  partnership
interests  were sold,  or the average bid and asked  prices of such  partnership
interests as of December 31, 1999. No market exists for the limited  partnership
interests of the Registrant,  and,  therefore,  no aggregate market value can be
determined.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None


<PAGE>

                                     PART I

Item 1.     Description of Business

Angeles Income  Properties,  Ltd. 6 (the  "Partnership"  or  "Registrant")  is a
publicly held limited partnership organized under the California Uniform Limited
Partnership Act on June 29, 1984, as amended. The Partnership Agreement provides
that the  Partnership  is to terminate on December 31, 2037,  unless  terminated
prior to such date.

The Partnership's general partner is Angeles Realty Corporation II, a California
corporation  (the "General  Partner" or "ARC II") was  wholly-owned  by Insignia
Properties  Trust  ("IPT").  Effective  February 26,  1999,  IPT was merged into
Apartment   Investment  and  Management  Company  ("AIMCO")  (see  "Transfer  of
Control"). Thus, the General Partner is now a wholly-owned subsidiary of AIMCO.

The Partnership,  through its public offering of Limited Partnership Units, sold
47,384 units aggregating $47,384,000. The General Partner contributed capital in
the amount of $1,000 for a 1%  interest  in the  Partnership.  Since its initial
offering, the Partnership has not received, nor are limited partners required to
make,  additional  capital  contributions.  The  Partnership  was formed for the
purpose of acquiring fee and other forms of equity interests in various types of
real estate property.  At December 31, 1999, the Partnership  owned and operated
three  residential  properties  and two  commercial  properties  (see  "Item  2.
Description of Properties").

The Registrant  has no employees.  Management  and  administrative  services are
provided by the General Partner and by agents  retained by the General  Partner.
These services for the residential properties were provided by affiliates of the
General Partner for the years ended December 31, 1999 and 1998. As of October 1,
1998, these services for the commercial properties were provided by an unrelated
party.

The  real  estate  business  in which  the  Partnership  is  engaged  is  highly
competitive.  There are other  residential and commercial  properties within the
market  area  of  the  Partnership's  properties.  The  number  and  quality  of
competitive properties,  including those which may be managed by an affiliate of
the General  Partner in such market  area,  could have a material  effect on the
rental  market for the  apartments  and  commercial  space at the  Partnership's
properties and the rents that may be charged for such  apartments and commercial
space.  While the  General  Partner  and its  affiliates  own  and/or  control a
significant  number of apartment units in the United States such units represent
an  insignificant  percentage of total  apartment units in the United States and
competition  for  the  apartments  is  local.  The  General  Partner  is  not  a
significant factor in commercial real estate.

There have been, and it is possible there may be other, Federal, state and local
legislation  and  regulations   enacted   relating  to  the  protection  of  the
environment.  The Partnership is unable to predict the extent,  if any, to which
such new  legislation  or  regulations  might occur and the degree to which such
existing or new legislation or regulations might adversely affect the properties
owned by the Partnership.

The Partnership  monitors its properties for evidence of pollutants,  toxins and
other dangerous substances, including the presence of asbestos. In certain cases
environmental  testing has been performed which resulted in no material  adverse
conditions or liabilities.  In no case has the Partnership  received notice that
it is a potentially  responsible party with respect to an environmental clean up
site.

<PAGE>

Both  the  income  and  expenses  of  operating  the  properties  owned  by  the
Partnership are subject to factors outside of the Partnership's control, such as
changes in the supply and demand for similar  properties  resulting from various
market  conditions,  increases/decreases  in unemployment or population  shifts,
changes in the availability of permanent mortgage  financing,  changes in zoning
laws,  or changes in patterns or needs of users.  In  addition,  there are risks
inherent in owning and operating  residential and commercial  properties because
such properties are  susceptible to the impact of economic and other  conditions
outside of the control of the Partnership.

A further description of the Partnership's business is included in "Management's
Discussion and Analysis or Plan of Operation"  included in "Item 6" of this Form
10-KSB.

Transfer of Control

Pursuant  to a series  of  transactions  which  closed  on  October  1, 1998 and
February 26, 1999,  Insignia  Financial Group, Inc. and IPT merged into AIMCO, a
publicly  traded real estate  investment  trust,  with AIMCO being the surviving
corporation (the "Insignia Merger").  As a result, AIMCO acquired 100% ownership
interest in the General Partner.  The General Partner does not believe that this
transaction has had or will have a material effect on the affairs and operations
of the Partnership.

Item 2.     Description of Properties

The following table sets forth the Partnership's investment in properties:

                         Date of
Property                 Purchase       Type of Ownership        Use

Lazy Hollow Apartments   07/01/89  Fee ownership, subject to  Apartment
  Columbia, MD                       a first mortgage         178 units

Homestead Apartments     11/10/88  Fee ownership subject to   Apartment
  East Lansing, MI                   a first mortgage         168 units

Casa Granada Apartments  04/30/89  Fee ownership subject to   Apartment
  Harlingen, TX                      a first mortgage (1)     108 units

Wakonda Shopping Center  04/01/95  Fee ownership subject to   Commercial
  Des Moines, IA                     a first mortgage (2)     147,000 sq. ft

Town & Country           04/01/95  Fee ownership subject to   Commercial
  Shopping Center                    a first mortgage (2)     104,000 sq. ft (3)
  Cedar Rapids, IA

(1)   Property is held by a Limited  Partnership which the Registrant owns a 99%
      interest in.

(2)   Property is held by a Limited Partnership which the Registrant owns a 100%
      interest in.

(3)   During May 1997, a tenant  occupying  18,600  square feet moved out as its
      lease had  expired.  The tenant  was a bowling  center  and  occupied  the
      basement  level  of the  property.  Due  to the  estimated  high  cost  of
      improving  this space and its basement  location,  the space is considered
      non-leasable space and is not included in the square footage above.

Schedule of Properties

Set forth below for each of the  Registrant's  properties is the gross  carrying
value,  accumulated  depreciation,  depreciable life, method of depreciation and
Federal tax basis.
<TABLE>
<CAPTION>

                             Gross
                            Carrying    Accumulated                         Federal
Property                      Value    Depreciation     Rate    Method     Tax Basis
                                (in thousands)                          (in thousands)
<S>                          <C>          <C>         <C>                   <C>
Lazy Hollow Apartments       $ 7,399      $ 2,778     5-40 yrs    S/L       $ 8,392
Homestead Apartments           5,721        2,070     5-40 yrs    S/L         5,062
Casa Granada Apartments        2,868          778     5-40 yrs    S/L         2,240
Continuing operations         15,988        5,626                            15,694

Discontinued Operations

Wakonda Shopping Center        3,578        1,151     5-40 yrs    S/L         4,551
Town & Country
  Shopping Center              4,458        1,192     5-40 yrs    S/L         3,431
Totals                       $24,024      $ 7,969                           $23,676
</TABLE>

See  "Note A" of the  consolidated  financial  statements  included  in "Item 7.
Financial Statements" for a description of the Partnership's depreciation policy
and "Note N - Change in Accounting Principle".

Schedule of Property Indebtedness

The  following  table  sets  forth  certain  information  relating  to the loans
encumbering the Registrant's properties.
<TABLE>
<CAPTION>

                                  Principal                                        Principal
                                 Balance At                                         Balance
                                December 31,    Interest    Period    Maturity      Due At
Property                            1999          Rate    Amortized     Date     Maturity (2)
                               (in thousands)                                   (in thousands)
Lazy Hollow Apartments
<S>                                <C>            <C>       <C>        <C>           <C>
  1st trust deed                   $ 3,919        7.50%     30 yrs     07/19         $   --
Homestead Apartments
  1st trust deed                     3,099        7.33%     30 yrs     11/03          2,935
Casa Granada Apartments
  1st trust deed                     1,408        7.65%     20 yrs     10/19             --
Continuing operations                8,426                                            2,935

Discontinued Operations

Wakonda Shopping Center and
  Town & Country Center
  1st trust deed (1)                 3,312        9.00%     30 yrs     12/03          3,125

      Total                        $11,738                                          $ 6,060
</TABLE>

(1)   Payable to Angeles  Mortgage  Investment  Trust  ("AMIT")  (See "Item 7.
      Financial Statements - Note G").

(2)   See "Item 7. Financial  Statements - Note C" for information  with respect
      to the  Registrant's  ability  to prepay  these  loans and other  specific
      details about the loans.

On September 30, 1999, the Partnership  refinanced the mortgage encumbering Casa
Granada Apartments.  Interest on the new mortgage is 7.65%.  Interest on the old
mortgage was 10.07%.  The refinancing  replaced  indebtedness  of  approximately
$1,279,000,  including  accrued  interest of  approximately  $12,000  with a new
mortgage in the amount of $1,413,000.  Payments of approximately $12,000 are due
on the first day of each month  until the loan  matures on October 1, 2019.  The
prior note matured in September 1999.

Rental Rates and Occupancy

Average annual rental rate and occupancy for 1999 and 1998 for each property:
<TABLE>
<CAPTION>

                                             Average Annual             Average
                                              Rental Rates             Occupancy
 Property                                  1999         1998        1999       1998

<S>                                    <C>           <C>             <C>        <C>
 Lazy Hollow Apartments                $9,618/unit   $9,391/unit     96%        97%
 Homestead Apartments                   7,866/unit    7,657/unit     93%        89%
 Casa Granada Apartments                5,677/unit    5,595/unit     95%        94%

 Discontinued Operations

 Wakonda Shopping Center                 5.42/s.f.    5.04/s.f.      86%        85%
 Town & Country Shopping Center          7.27/s.f.    6.80/s.f.      98%        89%
</TABLE>

The Partnership attributes the increase in occupancy at Homestead Apartments and
Town and Country Shopping Center to increased marketing efforts.

As noted under "Item 1.  Description of Business",  the real estate  industry is
highly competitive.  All of the properties are subject to competition from other
residential  apartment  complexes  and  commercial  buildings  in the area.  The
General Partner believes that all of the properties are adequately insured.  The
multi-family  residential  properties'  lease terms are for one year or less. No
residential  tenant leases 10% or more of the available rental space. All of the
properties are in good physical  condition,  subject to normal  depreciation and
deterioration as is typical for assets of this type and age.


<PAGE>


The following is a schedule of the commercial  lease  expirations  for the years
2000-2009:
<TABLE>
<CAPTION>

      Town & Country        Number of                     Annual        % of Gross
     Shopping Center       Expirations   Square Feet       Rent        Annual Rent
                                                      (in thousands)
<S>        <C>                 <C>         <C>             <C>            <C>
           2000                10          31,207          $ 245          34.44%
           2001                11          42,367            220          30.84%
           2002                 4           5,704             47           6.65%
           2003                 4          16,260            157          21.99%
           2004                 2           3,339             29           4.14%
           2005                 1           1,517             14           1.94%
        2006-2009              --              --             --             --
</TABLE>
<TABLE>
<CAPTION>

     Wakonda Shopping       Number of                     Annual        % of Gross
          Center           Expirations   Square Feet       Rent        Annual Rent
                                                      (in thousands)
<S>        <C>                  <C>        <C>             <C>            <C>
           2000                 9          14,104          $ 104          18.10%
           2001                 4          13,963             90          15.60%
           2002                 8          73,407            210          36.47%
           2003                 1           1,542             11           1.87%
           2004                 3           8,530             60          10.41%
           2005                 1           3,500             37           6.42%
        2006-2007              --              --             --             --
           2008                 1           4,300             33           5.75%
           2009                --              --             --             --
</TABLE>


The following schedule reflects  information on tenants occupying 10% or more of
the leasable square feet for each commercial property:
<TABLE>
<CAPTION>

                                            Square Footage   Annual Rent     Lease
Property               Nature of Business       Leased        Per Sq. Ft   Expiration

Town & Country
<S>                                             <C>             <C>         <C>   <C>
  Shopping Center      Variety Discount         14,412          $7.02       01/31/01

Wakonda Shopping
  Center               Grocery                  47,382          $ .78       01/31/02
</TABLE>



See financial  statements  Notes A and K for  additional  information  as to the
terms of these leases.


<PAGE>


Real Estate Taxes and Rates

Real estate taxes and rates in 1999 for each property were:

                                              1999            1999
                                            Billing           Rate
                                         (in thousands)
Properties

Lazy Hollow Apartments (1)                    $134            3.45%
Homestead Apartments                           144            5.50%
Casa Granada Apartments                         36            2.39%

Discontinued Operations

Wakonda Shopping Center (1)                    257            4.36%
Town & Country Shopping Center (1)              98            3.05%

(1)   Tax bill is for the fiscal year of the taxing authority which differs from
      that of the Partnership.

Capital Improvements

Lazy Hollow Apartments

The Partnership completed approximately $691,000 in capital expenditures at Lazy
Hollow Apartments as of December 31, 1999,  consisting  primarily of heating and
air conditioning replacements,  exterior painting, major landscaping, structural
repairs,  and carpet and vinyl replacement.  These improvements were funded from
operating  cash flow.  The  Partnership  is  currently  evaluating  the  capital
improvement  needs of the property for the upcoming  year. The minimum amount to
be budgeted is expected to be $300 per unit or $53,400.  Additional improvements
may be considered  and will depend on the physical  condition of the property as
well  as  replacement  reserves  and  anticipated  cash  flow  generated  by the
property.

Homestead Apartments

The  Partnership  completed  approximately  $149,000 in capital  expenditures at
Homestead  Apartments  as of December  31,  1999,  consisting  primarily of roof
replacements and carpet and vinyl  replacements.  These improvements were funded
from operating cash flow and replacement reserves.  The Partnership is currently
evaluating the capital  improvement needs of the property for the upcoming year.
The  minimum  amount to be  budgeted is expected to be $300 per unit or $50,400.
Additional  improvements  may be  considered  and will  depend  on the  physical
condition of the property as well as replacement  reserves and anticipated  cash
flow generated by the property.

Casa Granada Apartments

The Partnership completed approximately $202,000 in capital expenditures at Casa
Granada Apartments as of December 31, 1999,  consisting  primarily of carpet and
vinyl  replacements,   structural  improvements,  exterior  painting,  and  roof
replacements.  These  improvements  were funded from  replacement  reserves  and
operating  cash flow.  The  Partnership  is  currently  evaluating  the  capital
improvement  needs of the property for the upcoming  year. The minimum amount to
be budgeted is expected to be $300 per unit or $32,400.  Additional improvements
may be considered  and will depend on the physical  condition of the property as
well  as  replacement  reserves  and  anticipated  cash  flow  generated  by the
property.

Wakonda Shopping Center

The  Partnership  completed  approximately  $25,000 in capital  expenditures  at
Wakonda  Shopping  Center  as  of  December  31,  1999,   consisting  of  tenant
improvements and HVAC units.  These improvements were funded from operating cash
flow. The Partnership is currently  evaluating the capital  improvement needs of
the property for the upcoming year.

Town & Country Shopping Center

The Partnership completed approximately $4,000 in capital expenditures at Town &
Country  Shopping  Center  as  of  December  31,  1999,   consisting  of  tenant
improvements.  These  improvements  were funded from  operating  cash flow.  The
Partnership  is  currently  evaluating  the  capital  improvement  needs  of the
property for the upcoming year.

Mesa Dunes Mobile Home Park

The Partnership  completed  approximately $1,000 in capital improvements at Mesa
Dunes   Mobile  Home  Park  during  1999   consisting   primarily   of  building
improvements. This property was sold on February 19, 1999.

Item 3.     Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the   Partnership,   the  General  Partner  and  several  of  their   affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging  the  acquisition  by Insignia  Financial  Group,  Inc.
("Insignia")  and  entities  which  were,  at one time,  affiliates  of Insignia
("Insignia  Affiliates") of interests in certain general partner entities,  past
tender offers by Insignia  Affiliates to acquire limited  partnership units, the
management of partnerships  by Insignia  Affiliates and the Insignia Merger (see
"Item 7. Financial  Statements,  Note B - Transfer of Control").  The plaintiffs
seek monetary damages and equitable relief,  including  judicial  dissolution of
the  Partnership.  On June 25, 1998, the General  Partner filed a motion seeking
dismissal of the action.  In lieu of  responding to the motion,  the  plaintiffs
have filed an amended  complaint.  The General  Partner  filed  demurrers to the
amended  complaint  which were heard February  1999.  Pending the ruling on such
demurrers,  settlement  negotiations commenced. On November 2, 1999, the parties
executed and filed a Stipulation  of  Settlement,  settling  claims,  subject to
final court approval,  on behalf of the Partnership and all limited partners who
own units as of November 3, 1999.  Preliminary  approval of the  settlement  was
obtained on November 3, 1999 from the Superior Court of the State of California,
County of San Mateo,  at which time the Court set a final  approval  hearing for
December  10, 1999.  Prior to the  December 10, 1999 hearing the Court  received
various  objections  to the  settlement,  including a  challenge  to the Court's
preliminary  approval  based  upon  the  alleged  lack  of  authority  of  class
plaintiffs'  counsel to enter the settlement.  On December 14, 1999, the General
Partner  and  its  affiliates   terminated  the  proposed  settlement.   Certain
plaintiffs have filed a motion to disqualify some of the plaintiffs'  counsel in
the action.  The General Partner does not anticipate that costs  associated with
this case will be material to the Partnership's overall operations.

The  Partnership  is unaware of any other  pending or  outstanding  litigation
that is not of a routine nature arising in the ordinary course of business.

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

During the quarter ended December 31, 1999, no matter was submitted to a vote of
unit holders through the solicitation of proxies or otherwise.


<PAGE>


                                     PART II

Item 5.     Market for the Partnership's Common Equity and Related Security
            Holder Matters

The  Partnership,  a  publicly-held  limited  partnership  sold  47,384  Limited
Partnership  Units during its offering period through September 30, 1988, and as
of December 31, 1999, had 47,311 Limited  Partnership  Units outstanding held by
2,848 Limited Partners of record. Affiliates of the General Partner owned 16,261
units or 34.37% at December 31, 1999. In 1998, the number of Limited Partnership
Units decreased by 3 units due to Limited  Partners  abandoning  their units. In
abandoning Limited Partnership Units, a Limited Partner  relinquishes all right,
title and interest in the Partnership as of the date of abandonment.

The following table sets forth the distributions made by the Partnership for the
years ended December 31, 1998 and 1999:

                                                Distributions
                                                            Per Limited
                                        Aggregate        Partnership Unit
                                                 (in thousands)

       01/01/98 - 12/31/98                   212                  --
       01/01/99 - 12/31/99                $5,615             $111.54

During the year ended  December 31, 1999,  the  Partnership  declared and paid a
distribution  of  approximately  $285,000  payable  to the  General  Partner  in
connection  with  the sale of Mesa  Dunes  Mobile  Home  Park.  The  Partnership
declared  a  distribution  of  approximately  $212,000  in 1998  for the sale of
Whispering  Pines  Mobile Home Park which was  subsequently  paid to the General
Partner  during  the year  ended  December  31,  1999.  However,  these fees are
subordinate to the limited partners  receiving a preferred  return, as specified
in the partnership  agreement.  If the limited  partners have not received their
preferred  return when the  Partnership  terminates,  the General  Partner  will
return  these  amounts  to  the   Partnership.   The   Partnership   distributed
approximately  $4,016,000  (approximately  $3,976,000 to the limited partners or
$84.04 per limited  partnership  unit) from the Mesa Dunes  Mobile Home Park and
Whispering  Pines Mobile Home Park sale  proceeds and  approximately  $1,314,000
(approximately  $1,301,000  to  the  limited  partners  or  $27.50  per  limited
partnership  unit) from  operations  during the year ended December 31, 1999. No
distributions  were  paid  during  the year  ended  December  31,  1998.  Future
distributions  will depend on the levels of net cash generated from  operations,
the  availability  of  cash  reserves,   and  the  timing  of  debt  maturities,
refinancings,  and/or property sales. The Partnership's  distribution  policy is
reviewed on a semi-annual  basis. There can be no assurance,  however,  that the
Partnership  will  generate  sufficient  funds from  operations  after  required
capital expenditures to permit distributions to its partners in the year 2000 or
subsequent periods.

Several tender offers were made by various parties,  including affiliates of the
General Partner,  during the years ended December 31, 1999 and 1998. As a result
of these tender offers,  AIMCO and its  affiliates  currently own 16,261 limited
partnership  units in the  Partnership  representing  34.37% of the  outstanding
units.  It is  possible  that  AIMCO  or its  affiliates  will  make one or more
additional offers to acquire  additional  limited  partnership  interests in the
Partnership  for cash or in exchange for units in the operating  partnership  of
AIMCO. Under the Partnership  Agreement,  unitholders  holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters.  When
voting on matters, AIMCO would in all likelihood vote the Units it acquired in a
manner  favorable  to the  interest  of the  General  Partner  because  of their
affiliation with the General Partner.

Item 6.     Management's Discussion and Analysis or Plan of Operation

The  matters  discussed  in this Form  10-KSB  contain  certain  forward-looking
statements  and  involve  risks and  uncertainties  (including  changing  market
conditions, competitive and regulatory matters, etc.) detailed in the disclosure
contained  in this Form 10-KSB and the other  filings  with the  Securities  and
Exchange  Commission made by the Registrant from time to time. The discussion of
the Registrant's business and results of operations,  including  forward-looking
statements pertaining to such matters, does not take into account the effects of
any changes to the Registrant's business and results of operation.  Accordingly,
actual   results   could  differ   materially   from  those   projected  in  the
forward-looking  statements as a result of a number of factors,  including those
identified herein.

This item should be read in conjunction with "Item 7. Financial  Statements" and
other items contained elsewhere in this report.

Results of Operations

The  Partnership  realized  net income of  approximately  $1,714,000  versus net
income of  approximately  $3,131,000  for the years ended  December 31, 1999 and
1998, respectively. The decrease in net income is due primarily to a decrease in
total revenues resulting from the gain of approximately  $1,783,000  realized on
the sale of Mesa Dunes Mobile Home Park in February 1999 partially offset by the
extraordinary loss on early  extinguishment of debt of approximately  $1,011,000
during  the  first  quarter  of 1999  was less  than  the gain of  approximately
$2,995,000  realized on the sale of  Whispering  Pines  Mobile Home Park in July
1998 partially offset by the extraordinary loss on early  extinguishment of debt
of  approximately  $229,000  during  the third  quarter of 1998.  Excluding  the
operations of Mesa Dunes and  Whispering  Pines and the related gain on the sale
of the investment  properties,  income  increased during the year ended December
31, 1999 as compared to the year ended  December 31, 1998.  This increase at the
Partnership's residential properties is due to an increase in total revenues and
a decrease  in total  expenses.  The  increase  in total  revenues  is due to an
increase in rental and other income.  Rental income increased due to rental rate
increases and improved  occupancy at two of the  residential  properties.  Other
income  increased  primarily due to interest earned on the sale proceeds of Mesa
Dunes Mobile Home Park prior to the funds being distributed to the partners. The
decrease in total  expenses is primarily due to a decrease in operating  expense
and  general  and  administrative  expense  partially  offset by an  increase in
depreciation  expense.  The decrease in operating expense is due to decreases in
insurance and maintenance expenses.  The decrease in insurance expense is due to
a change in  insurance  carriers  which  resulted  in new  policies  with  lower
premiums.  The decrease in maintenance expense is due primarily to the reduction
of exterior  building  improvements  at  Homestead  Apartments.  The decrease in
general  and  administrative  expenses  is due to a decline in  general  partner
reimbursements.  The  increase  in  depreciation  expense  is  due  to  property
improvements  and replacements  placed into service at the remaining  properties
over the last 12 months.

<PAGE>
Included in general and  administrative  expenses at both  December 31, 1999 and
1998 are  management  reimbursements  to the General  Partner  allowed under the
Partnership  Agreement.  In addition,  costs  associated  with the quarterly and
annual  communications  with  investors and  regulatory  agencies and the annual
audit required by the Partnership Agreement are also included.

On February 19,  1999,  the  Partnership  sold Mesa Dunes Mobile Home Park to an
unaffiliated  third party for  distributable net sales proceeds of approximately
$9,292,000  after payment of closing costs.  The Partnership  realized a gain of
approximately  $1,783,000  on the sale  during the first  quarter  of 1999.  The
Partnership also realized a loss on the early extinguishment of debt encumbering
the  property  of  approximately  $1,011,000  during  the first  quarter of 1999
consisting of a prepayment  penalty and the write off of unamortized  loan costs
and mortgage discount.

On July 16, 1998, the Partnership  sold Whispering  Pines Mobile Home Park to an
unaffiliated  third  party for net sales  proceeds of  approximately  $6,959,000
after payment of closing costs. The Partnership realized a gain of approximately
$2,995,000 on the sale during the third quarter of 1998.  The  Partnership  also
realized a loss on the early extinguishment of debt encumbering Whispering Pines
Mobile  Home Park of  approximately  $229,000  during the third  quarter of 1998
consisting of the write off of unamortized loan costs and mortgage discount.

The  increase in income from  discontinued  operations  is  primarily  due to an
increase in rental  income as the result of the  increase in occupancy at Town &
Country Shopping Center.

Wakonda  Shopping  Center  and  Town &  Country  Shopping  Center  are  the  two
commercial  properties owned by the Partnership and represent one segment of the
Partnership's  operations.  Due to the  projected  sale  of the  two  commercial
properties in 2000, the net assets of these  properties  have been classified as
"Investment in discontinued  operations" as of December 31, 1999, on the balance
sheet.  The  investment  in  discontinued  operations on the balance sheet as of
December  31, 1999  includes  all the assets and  liabilities  of Town & Country
Shopping Center and Wakonda Shopping Center.  The income of these two properties
has been classified as "Income from discontinued operations" for the years ended
December 31, 1999 and 1998. The revenues of these properties were  approximately
$1,909,000  and  $1,735,000  for  1999  and  1998,  respectively.   Income  from
operations was approximately $460,000 and $308,000, respectively.

Effective  January 1, 1999, the Partnership  changed its method of accounting to
capitalize the cost of exterior  painting and major landscaping on a prospective
basis.  The  Partnership  believes  that  this  accounting  principle  change is
preferable  because it provides a better  matching of expenses  with the related
benefit of the expenditures and it is consistent with industry  practice and the
policies  of the  General  Partner.  The  effect  of the  change  in 1999 was to
increase net income by  approximately  $156,000  ($3.26 per limited  partnership
unit). The cumulative effect, had this change been applied to prior periods,  is
not material.  The accounting  principle  change will not have an effect on cash
flow,  funds  available for  distribution or fees payable to the General Partner
and affiliates.

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

Capital Resources and Liquidity

At December 31, 1999, the  Partnership  held cash  equivalents of  approximately
$1,235,000  compared to  approximately  $4,918,000 at December 31, 1998. For the
year  ended  December  31,  1999,  cash  and  cash   equivalents   decreased  by
approximately  $3,683,000 from the  Partnership's  year ended December 31, 1998.
The decrease in cash and cash equivalents is due to approximately $13,137,000 of
cash used in financing  activities,  which was partially offset by approximately
$8,366,000 of cash provided by investing activities and approximately $1,088,000
of cash  provided by operating  activities.  Cash used in  financing  activities
consisted primarily of repayment of the mortgages  encumbering Mesa Dunes Mobile
Home  Park  and  Casa  Granada  Apartments,   distributions  paid  to  partners,
prepayment  penalties  relating to Mesa Dunes Mobile Home Park, loan costs,  and
payments on mortgages  encumbering the remaining  properties partially offset by
proceeds  from the  refinancing  of Casa Granada  Apartments.  Cash  provided by
investing activities consisted primarily of sale proceeds from Mesa Dunes Mobile
Home Park and net withdrawals from restricted escrows maintained by the mortgage
lenders offset by property  improvements and replacements and lease commissions.
The Registrant invests its working capital reserves in money market accounts.

On September 30, 1999, the Partnership  refinanced the mortgage encumbering Casa
Granada Apartments.  Interest on the new mortgage is 7.65%.  Interest on the old
mortgage was 10.07%.  The refinancing  replaced  indebtedness  of  approximately
$1,279,000,  including  accrued  interest of  approximately  $12,000  with a new
mortgage in the amount of $1,413,000.  Payments of approximately $12,000 are due
on the first day of each month  until the loan  matures on October 1, 2019.  The
prior note matured in September 1999.

The sufficiency of existing  liquid assets to meet future  liquidity and capital
expenditure   requirements   is  directly   related  to  the  level  of  capital
expenditures  required at the various  properties  to  adequately  maintain  the
physical  assets and other  operating needs of the Registrant and to comply with
Federal, state, and local legal and regulatory requirements.  The minimum amount
to be  budgeted  is  expected  to be $300  per unit or  approximately  $136,200.
Additional  improvements  may be  considered  and will  depend  on the  physical
condition of each property as well as replacement  reserves and anticipated cash
flow  generated  by each  property.  To the extent  that such  budgeted  capital
improvements are completed,  the Registrant's  distributable  cash flow, if any,
may be adversely affected at least in the short term.

The Partnership's  current assets are thought to be sufficient for any near-term
needs  (exclusive  of capital  improvements)  of the  Partnership.  The mortgage
indebtedness  of  approximately  $8,426,000  has  maturity  dates  ranging  from
November  2003 to October  2019.  The General  Partner will attempt to refinance
such  indebtedness  and/or sell the properties  prior to such maturity dates. If
the  properties  cannot  be  refinanced  or sold for a  sufficient  amount,  the
Registrant will risk losing such properties through foreclosure.

The Partnership  declared a distribution of  approximately  $212,000 in 1998 for
the sale of Whispering Pines Mobile Home Park which was subsequently paid to the
General  Partner  during the year ended  December  31,  1999.  During the twelve
months ended December 31, 1999, the Partnership declared and paid a distribution
of approximately  $285,000 payable to the General Partner in connection with the
sale of Mesa Dunes Mobile Home Park. However, both of these fees are subordinate
to the limited  partners  receiving  a preferred  return,  as  specified  in the
partnership agreement. If the limited partners have not received their preferred
return when the  Partnership  terminates,  the General Partner will return these
amounts to the Partnership. The Partnership distributed approximately $4,016,000
(approximately  $3,976,000  to  the  limited  partners  or  $84.04  per  limited
partnership  unit) from the Mesa Dunes  Mobile  Home Park and  Whispering  Pines
Mobile  Home Park sale  proceeds  and  approximately  $1,314,000  (approximately
$1,301,000 to the limited partners or $27.50 per limited  partnership unit) from
operations  during the year ended December 31, 1999. No distributions  were paid
during the twelve months ended December 31, 1998. The Partnership's distribution
policy is reviewed on a semi-annual basis. Future cash distributions will depend
on the levels of net cash generated from  operations,  the  availability of cash
reserves,  and the  timing of debt  maturities,  refinancings,  and/or  property
sales.  There can be no assurance,  however,  that the Partnership will generate
sufficient funds from operations  after required capital  expenditures to permit
any further  distributions  to its partners  during the year 2000 or  subsequent
periods.

Several tender offers were made by various parties,  including affiliates of the
General Partner,  during the years ended December 31, 1999 and 1998. As a result
of these tender offers,  AIMCO and its  affiliates  currently own 16,261 limited
partnership  units in the  Partnership  representing  34.37% of the  outstanding
units.  It is  possible  that  AIMCO  or its  affiliates  will  make one or more
additional offers to acquire  additional  limited  partnership  interests in the
Partnership  for cash or in exchange for units in the operating  partnership  of
AIMCO. Under the Partnership  Agreement,  unitholders  holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters.  When
voting on matters, AIMCO would in all likelihood vote the Units it acquired in a
manner  favorable  to the  interest  of the  General  Partner  because  of their
affiliation with the General Partner.

Year 2000 Compliance

General Description

The Year 2000 issue is the result of computer  programs  being written using two
digits rather than four digits to define the applicable year. The Partnership is
dependent  upon the  General  Partner  and its  affiliates  for  management  and
administrative services ("Managing Agent"). Any of the Managing Agent's computer
programs or hardware that had  date-sensitive  software or embedded  chips might
have  recognized  a date using "00" as the year 1900  rather than the year 2000.
This  could  have  resulted  in a  system  failure  or  miscalculations  causing
disruptions of operations,  including, among other things, a temporary inability
to process  transactions,  send invoices,  or engage in similar normal  business
activities.

Computer Hardware, Software and Operating Equipment

In 1999,  the Managing  Agent  completed  all phases of its Year 2000 program by
completing  the  replacement  and repair of any  hardware or software  system or
operating  equipment that was not yet Year 2000 compliant.  The Managing Agent's
hardware  and software  systems and its  operating  equipment  are now Year 2000
compliant.  No  material  failure or  erroneous  results  have  occurred  in the
Managing Agent's computer  applications  related to the failure to reference the
Year 2000 to date.

Third Parties

To  date,  the  Managing  Agent  is not  aware of any  significant  supplier  or
subcontractor  (external agent) or financial institution of the Partnership that
has a Year 2000 issue that  would  have a material  impact on the  Partnership's
results of operations,  liquidity or capital  resources.  However,  the Managing
Agent  has no means of  ensuring  or  determining  the Year 2000  compliance  of
external  agents.  At this time, the Managing Agent does not believe that a Year
2000 issue of any  non-compliant  external agent will have a material  impact on
the Partnership's financial position or results of operations.

Costs

The total cost of the Managing Agent's Year 2000 project was approximately  $3.2
million and was funded from operating cash flows.

Risks Associated with the Year 2000

The Managing  Agent  completed all necessary  phases of its Year 2000 program in
1999,  and did not  experience  system or  equipment  malfunctions  related to a
failure to reference the Year 2000. The Managing  Agent or  Partnership  has not
been  materially  adversely  effected by  disruptions  in the economy  generally
resulting from the Year 2000 issue.

At this  time,  the  Managing  Agent  does not  believe  that the  Partnership's
businesses,  results of  operations  or financial  condition  will be materially
adversely effected by the Year 2000 issue.

Contingency Plans Associated with the Year 2000

The  Managing  Agent has not had to implement  contingency  plans such as manual
workarounds or selecting new relationships for its banking or elevator operation
activities in order to avoid the Year 2000 issue.


<PAGE>


Item 7.     Financial Statements

ANGELES INCOME PROPERTIES, LTD. 6

LIST OF FINANCIAL STATEMENTS

      Report of Ernst & Young LLP, Independent Auditors

      Consolidated Balance Sheet - December 31, 1999

      Consolidated  Statements of  Operations - Years ended  December 31, 1999
      and 1998

      Consolidated  Statements of Changes in Partners' (Deficit) Capital - Years
      ended December 31, 1999 and 1998

      Consolidated  Statements  of Cash Flows - Years ended  December 31, 1999
      and 1998

      Notes to Consolidated Financial Statements


<PAGE>


              Report of Ernst & Young LLP, Independent Auditors



The Partners
Angeles Income Properties, Ltd. 6


We have audited the  accompanying  consolidated  balance sheet of Angeles Income
Properties,  Ltd.  6 as of  December  31,  1999,  and the  related  consolidated
statements of operations,  changes in partners' (deficit) capital and cash flows
for each of the two years in the period ended December 31, 1999. These financial
statements  are  the  responsibility  of  the  Partnership's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the consolidated  financial  position of Angeles Income
Properties,  Ltd. 6 at December 31, 1999,  and the  consolidated  results of its
operations  and its cash  flows  for each of the two years in the  period  ended
December 31, 1999, in conformity with accounting  principles  generally accepted
in the United States.

As discussed in Note N to the consolidated financial statements, the Partnership
changed its method of accounting to capitalize the cost of exterior painting and
major landscaping effective January 1, 1999.

                                                            /s/ERNST & YOUNG LLP


Greenville, South Carolina
February 25, 2000



<PAGE>


                        ANGELES INCOME PROPERTIES, LTD. 6

                           CONSOLIDATED BALANCE SHEET

                       (in thousands, except unit data)

                                December 31, 1999
<TABLE>
<CAPTION>

Assets
<S>                                                                         <C>
   Cash and cash equivalents                                                $ 1,235
   Receivables and deposits                                                     381
   Restricted escrows                                                           245
   Other assets                                                                 288
   Investment properties (Notes C and I):
      Land                                                    $ 1,632
      Buildings and related personal property                  14,356
                                                               15,988

      Less accumulated depreciation                            (5,626)       10,362

   Investment in discontinued operations (Note H)                             2,811
                                                                            $15,322

Liabilities and Partners' Capital
Liabilities
   Accounts payable                                                          $  257
   Tenant security deposit liabilities                                           52
   Accrued property taxes                                                        63
   Other liabilities                                                            226
   Mortgage notes payable (Note C)                                            8,426

Partners' Capital
   General partner                                              $ 63
   Limited partners (47,311 units issued
      and outstanding)                                          6,235         6,298
                                                                            $15,322
</TABLE>

           See Accompanying Notes to Consolidated Financial Statements
<PAGE>


                      ANGELES INCOME PROPERTIES, LTD. 6

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                       (in thousands, except unit data)

<TABLE>
<CAPTION>

                                                           Years Ended December 31,
                                                               1999         1998

Revenues:                                                                (Restated)
<S>                                                          <C>           <C>
   Rental income                                             $  3,556      $ 5,035
   Other income                                                   307          340
   Gain on sale of investment properties                        1,783        2,995
      Total revenues                                            5,646        8,370

Expenses:
   Operating expenses                                           1,458        2,100
   General and administrative                                     311          567
   Depreciation                                                   519          719
   Interest                                                       757        1,475
   Property taxes                                                 336          457
      Total expenses                                            3,381        5,318

Income before discontinued operations and
   extraordinary item                                           2,265        3,052
Income from discontinued operations                               460          308
Income before extraordinary item                                2,725        3,360
Extraordinary loss on early extinguishment of debt             (1,011)        (229)

Net income                                                   $  1,714      $ 3,131

Net income allocated to general partner                       $   299        $ 646
Net income allocated to limited partners                        1,415        2,485

                                                             $  1,714      $ 3,131

Per limited partnership unit:
   Income before discontinued operations and
      extraordinary item                                     $  41.44      $ 50.86
   Income from discontinued operations                           9.63         6.45
   Extraordinary loss on early extinguishment of debt          (21.16)       (4.79)

              Net income                                     $  29.91      $ 52.52

Distributions per limited partnership unit                   $ 111.54       $  --
</TABLE>

           See Accompanying Notes to Consolidated Financial Statements
<PAGE>


                      ANGELES INCOME PROPERTIES, LTD. 6

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

<TABLE>
<CAPTION>

                                         Limited
                                       Partnership    General    Limited
                                          Units       Partner    Partners     Total

<S>                                       <C>           <C>       <C>        <C>
Original capital contributions            47,384        $   1     $47,384    $47,385

Partners' (deficit) capital at
   December 31, 1997                      47,314       $ (332)    $ 7,612    $ 7,280

Abandonment of limited
   partnership units (Note J)                 (3)

Distribution payable to General
   Partner (Note G)                           --         (212)         --       (212)

Net income for the year ended
   December 31, 1998                          --          646       2,485      3,131

Partners' capital at
   December 31, 1998                      47,311          102      10,097     10,199

Distributions to partners                     --         (338)     (5,277)    (5,615)

Net income for the year ended
   December 31, 1999                          --          299       1,415      1,714

Partners' capital at
   December 31, 1999                      47,311        $ 63      $ 6,235    $ 6,298
</TABLE>

           See Accompanying Notes to Consolidated Financial Statements
<PAGE>


                      ANGELES INCOME PROPERTIES, LTD. 6

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                (in thousands)
<TABLE>
<CAPTION>

                                                              Year Ended December 31,
                                                                  1999        1998
Cash flows from operating activities:
<S>                                                             <C>          <C>
  Net income                                                    $  1,714     $ 3,131
  Adjustments to reconcile net income to net
   cash provided by operating activities:
   Depreciation                                                      868         999
   Amortization of discounts, loan costs, and leasing
      commissions                                                     75         124
   Gain on sale of investment properties                          (1,783)     (2,995)
   Extraordinary loss on early extinguishment of debt              1,011         229
   Change in accounts:
      Receivables and deposits                                       (62)        340
      Other assets                                                  (314)        (87)
      Accounts payable                                                77          16
      Tenant security deposit liabilities                             --          (2)
      Accrued taxes                                                  (52)         28
      Other liabilities                                             (446)        316

          Net cash provided by operating activities                1,088       2,099

Cash flows from investing activities:
  Property improvements and replacements                            (977)       (749)
  Lease commissions paid                                              (7)         --
  Net withdrawals from (deposits to) restricted escrows               58         (14)
  Proceeds from sale of investment properties                      9,292       6,959

          Net cash provided by investing activities                8,366       6,196

Cash flows used in financing activities:
  Proceeds from long-term borrowing                                1,413          --
  Repayment of mortgage notes payable                             (7,702)     (5,027)
  Loan costs paid                                                    (46)         --
  Prepayment penalty                                                (787)         --
  Distributions paid                                              (5,827)         --
  Payments on mortgage notes payable                                (188)       (291)

          Net cash used in financing activities                  (13,137)     (5,318)

Net (decrease) increase in cash and cash equivalents              (3,683)      2,977
Cash and cash equivalents at beginning of the year                 4,918       1,941
Cash and cash equivalents at end of year                        $  1,235     $ 4,918

Supplemental disclosure of cash flow information:
  Cash paid for interest                                        $ 1,050      $ 1,707
Supplemental disclosure of non-cash flow information:
  Distribution payable to General Partner                         $  --        $ 212
  Property improvements and replacements in accounts
   payable                                                        $  95        $ --
</TABLE>

           See Accompanying Notes to Consolidated Financial Statements
<PAGE>

                      ANGELES INCOME PROPERTIES, LTD. 6

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                December 31, 1999

Note A - Organization and Significant Accounting Policies

Organization:   Angeles  Income   Properties,   Ltd.  6  (the  "Partnership"  or
"Registrant")  is  a  publicly-held  limited  partnership  organized  under  the
California Uniform Limited  Partnership Act pursuant to the Agreement of Limited
Partnership dated June 29, 1984, as amended. The Partnership's  general partner,
Angeles Realty  Corporation II, a California  corporation (the "General Partner"
or "ARC II") was wholly-owned by Insignia  Properties  Trust ("IPT").  Effective
February 26, 1999, IPT merged into Apartment  Investment and Management  Company
("AIMCO").  Thus, the General Partner is now a wholly-owned  subsidiary of AIMCO
(see "Note B - Transfer of Control").  The Partnership  Agreement  provides that
the Partnership is to terminate on December 31, 2037, unless terminated prior to
such date. As of December 31, 1999, the Partnership  operates three  residential
properties in Maryland,  Michigan,  and Texas and two  commercial  properties in
Iowa.

Principles  of  Consolidation:  The  consolidated  financial  statements  of the
Partnership  include its 99% limited  partnership  interests  in Granada AIPL 6,
Ltd., AIP 6 GP, LP,  Whispering Pines AIP 6, LP and Lazy Hollow  Partners,  Ltd.
The Partnership may remove the General Partner of all of the above Partnerships;
therefore,  the partnerships are controlled and consolidated by the Partnership.
Also included in the consolidated  financial  statements are Mesa Dunes GP, LLC,
Wakonda Partners,  Town and Country Partners and Mesa Dunes Partners,  which are
wholly-owned by the partnership.  All significant interentity balances have been
eliminated.

Allocations and  Distributions to Partners:  In accordance with the Agreement of
Limited  Partnership (the  "Partnership  Agreement"),  any gain from the sale or
other  disposition of Partnership  assets will be allocated first to the General
Partner  to the  extent of the  amount of any  Incentive  Interest  to which the
General  Partner is entitled.  Any gain remaining  after said allocation will be
allocated to the General  Partner and Limited  Partners in  proportion  to their
interests in the Partnership;  provided,  that the gain shall first be allocated
to Partners with negative account balances,  in proportion to such balances,  in
an amount equal to the sum of such negative capital account balances.

The Partnership will allocate other profits and losses 1% to the General Partner
and 99% to the Limited Partners.

Except as discussed below, the Partnership will allocate distributions 1% to the
General Partner and 99% to the Limited Partners.

Upon  the  sale  or  other  disposition,  or  refinancing  of any  asset  of the
Partnership, the Distributable Net Proceeds shall be distributed as follows: (i)
First, to the General Partner,  on account of the current and accrued Management
Fee payable,  deferred as contemplated  therein (ii) Second,  to the Partners in
proportion to their interests until the Limited Partners have received  proceeds
equal to their unrecovered  Capital  Contributions  (iii) Third, to the Partners
until the Limited  Partners have received  distributions  equal to their 6% (not
compounded) Cumulative  Distribution;  (iv) Fourth, to the General Partner until
it has received an amount equal to 3% of the aggregate Disposition Prices of all
properties or investments sold (Initial Incentive  Interest);  (v) Fifth, to the
Partners until the Limited Partners have received  distributions  equal to their
8% (not  compounded)  Cumulative  Distribution,  with certain  limited  partners
receiving additional priority  distributions ranging from 1.5% to 4.5% per annum
(not compounded);  and (vi) Sixth, thereafter, 86% to the Partners in proportion
to their interests and 14% (Final Incentive Interest) to the General Partner.

Fair Value of Financial Instruments: Statement of Financial Accounting Standards
("SFAS") No. 107,  "Disclosures about Fair Value of Financial  Instruments",  as
amended by SFAS No. 119, "Disclosures about Derivative Financial Instruments and
Fair  Value  of  Financial  Instruments",  requires  disclosure  of  fair  value
information  about  financial  instruments,  whether  or not  recognized  in the
balance sheet, for which it is practicable to estimate fair value. Fair value is
defined in the SFAS as the amount at which the instruments could be exchanged in
a  current  transaction  between  willing  parties,  other  than in a forced  or
liquidation  sale.  The  Partnership  believes  that the carrying  amount of its
financial  instruments (except for long term debt) approximates their fair value
due to the short  term  maturity  of these  instruments.  The fair  value of the
Partnership's  long term debt, after  discounting the scheduled loan payments to
maturity, approximates its carrying balance.

Depreciation:  Depreciation is calculated by the  straight-line  method over the
estimated  lives of the  investment  properties  and related  personal  property
ranging  from 15 to 40 years for  buildings  and  improvements  and from five to
seven years for  furnishings.  For Federal income tax purposes,  the accelerated
cost  recovery  method is used (1) for real property over 15 years for additions
prior to March 16, 1984, 18 years for additions  after March 15, 1984 and before
May 9, 1985, and 19 years for additions after May 8, 1985, and before January 1,
1987, and (2) for personal  property over 5 years for additions prior to January
1, 1987. As a result of the Tax Reform Act of 1986, for additions after December
31, 1986, the modified accelerated cost recovery method is used for depreciation
of (1) real property over 27 1/2 years and (2) personal property  additions over
5 years.

Effective  January 1, 1999 the  Partnership  changed its method of accounting to
capitalize the costs of exterior painting and major landscaping (see "Note N").

Use of Estimates:  The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Cash and Cash  Equivalents:  Cash and cash equivalents  include cash on hand, in
banks and money market accounts.  At certain times, the amount of cash deposited
at a bank may exceed the limit on insured deposits.

<PAGE>

Tenant  Security  Deposits:  The  Partnership  requires  security  deposits from
lessees  for the  duration  of the  lease  and such  deposits  are  included  in
receivables  and deposits  for the  residential  properties  and  investment  in
discontinued  operations  for the commercial  properties.  Deposits are refunded
when the tenant  vacates,  provided  the tenant has not damaged its space and is
current on its rental payments.

Investment   Properties:   Investment  properties  consist  of  three  apartment
complexes  and two  commercial  complexes  and are  stated  at cost.  Due to the
projected sale of the two commercial properties in 2000, the net assets of these
properties have been classified as "Investment in discontinued operations" as of
December 31, 1999, on the balance sheet.  Acquisition  fees are capitalized as a
cost of real  estate.  In  accordance  with SFAS No.  121,  "Accounting  for the
Impairment of Long-Lived  Assets and for  Long-Lived  Assets to Be Disposed Of",
the  Partnership   records  impairment  losses  on  long-lived  assets  used  in
operations  when  events and  circumstances  indicate  that the assets  might be
impaired  and the  undiscounted  cash flows  estimated  to be generated by those
assets are less than the carrying  amounts of those assets.  Costs of investment
properties  that have  been  permanently  impaired  have  been  written  down to
appraised  value.  No  adjustments  for impairment of value were recorded in the
years ended December 31, 1999 or 1998.

Restricted  Escrows: As a result of the refinancings in prior years of Homestead
Apartments and Lazy Hollow Apartments, general reserve accounts were established
to cover  necessary  repairs  and  replacements  of existing  improvements.  The
balance in the reserve account for Homestead  Apartments at December 31, 1999 is
approximately $24,000, with required monthly deposits of $2,000. The balance for
Lazy Hollow  Apartments  at December 31, 1999,  is  approximately  $221,000 with
required monthly deposits of $2,000.

Loan Costs: Loan costs of approximately $194,000, less accumulated  amortization
of approximately  $45,000 at December 31, 1999, are included in other assets and
are being  amortized  on a  straight-line  basis  over the lives of the  related
loans.

Advertising:  The  Partnership  expenses  the cost of  advertising  as incurred.
Advertising  costs of  approximately  $94,000 and  $109,000  for the years ended
December 31, 1999 and 1998,  respectively  were charged to operating expense for
the  residential  properties  as incurred.  Advertising  costs of  approximately
$6,000 and $27,000 for the years ended December 31, 1999 and 1998, respectively,
are  included  in  Income  from  discontinued   operations  for  the  commercial
properties.

Lease  Commissions:  Lease  commissions  of  approximately  $281,000,  which are
included  in  Investment  in   discontinued   operations  in  the   accompanying
consolidated  balance  sheet,  are  amortized on a straight  line basis over the
terms  of  the  respective   leases.   Current   accumulated   amortization   is
approximately $182,000.

Leases:  The Partnership  generally leases  residential  units for twelve-months
terms or less.  The  Partnership  recognizes  income as  earned  on  residential
leases.  Commercial  building lease terms are generally for one to twenty years.
Income from base rents on such leases is  recognized  on a  straight-line  basis
over the lease term.  Several tenants have percentage rent clauses which provide
for  additional  rent  upon the  tenant  achieving  certain  rental  objectives.
Percentage rent recognized was approximately  $124,000 in 1999 and approximately
$103,000 in 1998 and is included in income from discontinued operations.

<PAGE>

Segment Reporting: SFAS No. 131, "Disclosure about Segments of an Enterprise and
Related  Information"  established  standards  for the way that public  business
enterprises  report  information  about operating  segments in annual  financial
statements and requires that those enterprises report selected information about
operating segments in interim financial reports.  It also establishes  standards
for related disclosures about products and services, geographic areas, and major
customers. See "Note L" for required disclosures.

Note B - Transfer of Control

Pursuant  to a series  of  transactions  which  closed  on  October  1, 1998 and
February 26, 1999,  Insignia  Financial Group, Inc. and IPT merged into AIMCO, a
publicly  traded real estate  investment  trust,  with AIMCO being the surviving
corporation (the "Insignia Merger").  As a result, AIMCO acquired 100% ownership
interest in the General Partner.  The General Partner does not believe that this
transaction has had or will have a material effect on the affairs and operations
of the Partnership.

Note C - Mortgage Notes Payable

The principle terms of mortgage notes payable are as follows:
<TABLE>
<CAPTION>

                            Principal      Monthly                            Principal
                           Balance At      Payment     Stated                  Balance
                            December      Including   Interest    Maturity      Due At
        Property              1999         Interest     Rate        Date       Maturity
                                (in thousands)                              (in thousands)
Lazy Hollow Apartments
<S>                          <C>             <C>        <C>        <C>           <C>
  1st trust deed             $ 3,919         $32        7.50%      07/19         $ --
Homestead Apartments
  1st trust deed               3,099          22        7.33%      11/03         2,935
Casa Granada Apartments
  1st trust deed               1,408          12        7.65%      10/19            --
Continuing Operations          8,426          66                                 2,935

Discontinued Operations

Wakonda Shopping Center
  Town & Country
  Shopping Center
  1st trust deed (1)           3,312          28        9.00%      12/03         3,125
    Total                    $11,738         $94                               $ 6,060
</TABLE>

(1)   Payable to Angeles Mortgage Investment Trust ("AMIT") (see "Note G").

<PAGE>

On September 30, 1999, the Partnership  refinanced the mortgage encumbering Casa
Granada Apartments.  Interest on the new mortgage is 7.65%.  Interest on the old
mortgage was 10.07%.  The refinancing  replaced  indebtedness  of  approximately
$1,279,000,  including  accrued  interest of  approximately  $12,000  with a new
mortgage in the amount of $1,413,000.  Payments of approximately $12,000 are due
on the first day of each month  until the loan  matures on October 1, 2019.  The
prior note matured in September 1999.

The  mortgage  notes  payable are  nonrecourse  and are secured by pledge of the
Partnership's   investment  properties  and  by  pledge  of  revenues  from  the
investment properties.  Prepayment penalties are imposed if the mortgage note is
repaid prior to maturity.  Further,  the  properties  may not be sold subject to
existing indebtedness.

Scheduled  principal  payments  of the  mortgage  notes  payable  subsequent  to
December 31, 1999 are as follows (in thousands):

                                   2000          $  204
                                   2001             220
                                   2002             238
                                   2003           6,306
                                   2004             167
                                Thereafter        4,603
                                                $11,738

Note D - Sale of Investment Properties

On February 19,  1999,  the  Partnership  sold Mesa Dunes Mobile Home Park to an
unaffiliated  third party for  distributable net sales proceeds of approximately
$9,292,000  after payment of closing costs.  The Partnership  realized a gain of
approximately  $1,783,000  on the sale  during the first  quarter  of 1999.  The
Partnership also realized a loss on the early extinguishment of debt encumbering
the  property  of  approximately  $1,011,000  during  the first  quarter of 1999
consisting of a prepayment  penalty and the write off of unamortized  loan costs
and mortgage  discount.  Revenues from Mesa Dunes  included in the  accompanying
consolidated statements of operations were approximately $254,000 and $1,336,000
for the years ended December 31, 1999 and 1998, respectively.

On July 16, 1998, the Partnership  sold Whispering  Pines Mobile Home Park to an
unaffiliated  third  party for net sales  proceeds of  approximately  $6,959,000
after payment of closing costs. The Partnership realized a gain of approximately
$2,995,000 on the sale during the third quarter of 1998.  The  Partnership  also
realized a loss on the early extinguishment of debt encumbering Whispering Pines
Mobile  Home Park of  approximately  $229,000  during the third  quarter of 1998
consisting  of the write off of  unamortized  loan costs and mortgage  discount.
Revenues from Whispering  Pines in the accompanying  consolidated  statements of
operations were approximately $572,000 for the year ended December 31, 1998.

<PAGE>

Note E - Distributions

During the year ended  December 31, 1999,  the  Partnership  declared and paid a
distribution  of  approximately  $285,000  payable  to the  General  Partner  in
connection  with  the sale of Mesa  Dunes  Mobile  Home  Park.  The  Partnership
declared  a  distribution  of  approximately  $212,000  in 1998  for the sale of
Whispering  Pines  Mobile Home Park which was  subsequently  paid to the General
Partner  during  the year  ended  December  31,  1999.  However,  these fees are
subordinate to the limited partners  receiving a preferred  return, as specified
in the partnership  agreement.  If the limited  partners have not received their
preferred  return when the  Partnership  terminates,  the General  Partner  will
return  these  amounts  to  the   Partnership.   The   Partnership   distributed
approximately  $4,016,000  (approximately  $3,976,000 to the limited partners or
$84.04 per limited  partnership  unit) from the Mesa Dunes  Mobile Home Park and
Whispering  Pines Mobile Home Park sale  proceeds and  approximately  $1,314,000
(approximately  $1,301,000  to  the  limited  partners  or  $27.50  per  limited
partnership  unit) from  operations  during the year ended December 31, 1999. No
distributions were paid during the year ended December 31, 1998.

Note F - Income Taxes

The Partnership has received a ruling from the Internal  Revenue Service that it
will  be  classified  as  a  partnership   for  Federal   income  tax  purposes.
Accordingly, no provision for income taxes is made in the consolidated financial
statements of the  Partnership.  Taxable  income or loss of the  Partnership  is
reported in the income tax returns of its partners.

The  following is a  reconciliation  of reported net income and Federal  taxable
income (in thousands, except per unit data):

                                             1999          1998

Net income as reported                      $ 1,714      $ 3,131
Add (deduct):
  Depreciation differences                     (103)         (64)
  Disposition of investment property            349          (54)
  Other                                        (219)         124
Federal taxable income                      $ 1,741      $ 3,137

Federal taxable income per limited
  partnership unit                          $ 30.48      $ 53.32


The following is a reconciliation between the Partnership's reported amounts and
Federal tax basis of net assets and liabilities (in thousands):

   Net assets as reported               $6,298
   Land and buildings                    8,113
   Accumulated depreciation               (492)
   Syndication                           6,802
   Other                                   163
   Net assets - tax basis               $20,884

<PAGE>

Note G - Transactions with Affiliated Parties

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

The  following  payments  were  paid  or  accrued  to the  General  Partner  and
affiliates in 1999 and in 1998:

                                                              1999       1998
                                                               (in thousands)
   Property management fees (included in
     operating expense)                                       $189       $313
   Partnership management fees (included in general and
     administrative expense)                                    --        104
   Reimbursement for services of affiliates (included in
     investment properties, operating expense and
     general and administrative expense)                       205        293
   Property lease commissions                                   --         34

During the years ended  December  31, 1999 and 1998,  affiliates  of the General
Partner  were  entitled  to  receive  5% of  gross  receipts  from  all  of  the
Registrant's  residential properties for providing property management services.
The Registrant paid to such affiliates  approximately  $189,000 and $274,000 for
the years ended  December 31, 1999 and 1998,  respectively.  For the nine months
ending  September 30, 1998,  affiliates of the General  Partner were entitled to
varying   percentages  of  gross  receipts  from  the  Registrant's   commercial
properties  for providing  property  management  services.  These  services were
performed  by  affiliates  of the General  Partner  for the nine  months  ending
September 30, 1998 and were  approximately  $39,000.  Effective  October 1, 1998
(the effective date of the Insignia  Merger),  these services for the commercial
properties were provided by an unrelated party.

An  affiliate  of the General  Partner  received  reimbursement  of  accountable
administrative expenses amounting to approximately $205,000 and $293,000 for the
years ended December 31, 1999 and 1998, respectively.

Pursuant  to  the  Partnership   Agreement  for  managing  the  affairs  of  the
Partnership, the General Partner is entitled to receive a Partnership management
fee equal to 10% of the Partnership's adjusted cash from operations.  No fee was
accrued or paid in 1999.  Approximately  $104,000 in Partnership management fees
was accrued  during the year ended  December 31, 1998 and paid in 1999.  No fees
were due in 1999.

Pursuant  to the  Partnership  Agreement,  the  General  Partner is  entitled to
receive  a  distribution  of 3% of  the  aggregate  disposition  price  of  sold
properties.  Pursuant to this provision, the Partnership declared a distribution
of  approximately  $212,000 in 1998 for the sale of Whispering Pines Mobile Home
Park which was  subsequently  paid to the General  Partner during the year ended
December 31, 1999. The Registrant  also declared and paid a distribution  to the
General  Partner of  approximately  $285,000  in 1999 for the sale of Mesa Dunes
Mobile Home Park. These fees are subordinate to the limited partners receiving a
preferred  return,  as specified in the  Partnership  Agreement.  If the limited
partners  have  not  received  their  preferred   return  when  the  Partnership
terminates, the General Partner will return these amounts to the Partnership.

The Partnership has a first mortgage to AMIT in the amount of $3,312,000,  which
is secured  by  Wakonda  Shopping  Center  and Town & Country  Shopping  Center.
Pursuant to a series of transactions, affiliates of the General Partner acquired
ownership  interests in AMIT.  On September  17, 1998,  AMIT was merged with and
into IPT. On February  26,  1999,  IPT was then merged into AIMCO.  As a result,
AIMCO became the holder of the AMIT note.  The  Partnership  paid  approximately
$300,000  and  $303,000  in  interest  expense on this note to AMIT for 1999 and
1998, respectively.

Several tender offers were made by various parties,  including affiliates of the
General Partner,  during the years ended December 31, 1999 and 1998. As a result
of these tender offers,  AIMCO and its  affiliates  currently own 16,261 limited
partnership  units in the  Partnership  representing  34.37% of the  outstanding
units.  It is  possible  that  AIMCO  or its  affiliates  will  make one or more
additional offers to acquire  additional  limited  partnership  interests in the
Partnership  for cash or in exchange for units in the operating  partnership  of
AIMCO. Under the Partnership  Agreement,  unitholders  holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters.  When
voting on matters, AIMCO would in all likelihood vote the Units it acquired in a
manner  favorable  to the  interest  of the  General  Partner  because  of their
affiliation with the General Partner.

Note H - Investment in Discontinued Operations

Wakonda  Shopping  Center  and  Town &  Country  Shopping  Center  are  the  two
commercial  properties owned by the Partnership and represent one segment of the
Partnership's  operations.  Due to the  projected  sale  of the  two  commercial
properties in 2000, the net assets of these  properties  have been classified as
"Investment in discontinued  operations" as of December 31, 1999, on the balance
sheet.  The  investment  in  discontinued  operations on the balance sheet as of
December  31,  1999   includes  the   investment   property  and  the  remaining
receivables,  other assets and liabilities of Town & Country Shopping Center and
Wakonda  Shopping  Center.  The  results  of the  commercial  segment  have been
classified as "Income from discontinued operations" for the years ended December
31,  1999  and  1998.  The  revenues  of  these  properties  were  approximately
$1,909,000  and  $1,735,000  for  1999  and  1998,  respectively.   Income  from
operations  was  approximately   $460,000  and  $308,000,  for  1999  and  1998,
respectively.

<PAGE>

Note I - Real Estate and Accumulated Depreciation
<TABLE>
<CAPTION>

                                                   Initial Cost
                                                  To Partnership
                                                  (in thousands)
                                                                             Cost
                                                          Buildings       (Removed)
                                                         and Related     Captialized
                                                           Personal     Subsequent to
        Description          Encumbrances      Land        Property      Acquisition
                            (in thousands)                              (in thousands)
<S>                             <C>            <C>         <C>             <C>
Lazy Hollow Apartments          $ 3,919        $  998      $ 8,988         $(2,587)
Homestead Apartments              3,099           557        5,988            (824)
Casa Granada Apartments           1,408           235        1,930             703

Continuing Operations             8,426         1,790       16,906          (2,708)

Discontinued Operations

Wakonda Shopping Center           1,656           873        2,469             236
Town & Country Shopping
  Center                          1,656            38        3,994             426

Totals                          $11,738       $ 2,701      $23,369         $(2,046)
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

                          Gross Amount At Which Carried
                              At December 31, 1999
                                (in thousands)
                                   Buildings
                                  And Related
                                   Personal             Accumulated     Date    Depreciable
      Description          Land    Property    Total    Depreciation  Acquired  Life-Years
                                                       (in thousands)
<S>                       <C>       <C>       <C>         <C>         <C>   <C>    <C>
Lazy Hollow Apartments    $ 841     $ 6,558   $ 7,399     $ 2,778     07/01/89     5-40
Homestead Apartments         557      5,164     5,721       2,070     11/10/88     5-40
Casa Granada Apartments      234      2,634     2,868         778     04/30/89     5-40

Continuing Operations      1,632     14,356    15,988       5,626

Discontinued Operations

Wakonda Shopping Center      873      2,705     3,578       1,151     04/01/95     5-40
  And Town & Country
  Shopping Center             38      4,420     4,458       1,192     04/01/95     5-40

  Totals                 $ 2,543    $21,481   $24,024     $ 7,969
</TABLE>

Reconciliation of "Real Estate and Accumulated Depreciation":

                                                 Years Ended December 31,
                                                  1999             1998
                                                      (in thousands)
Investment Properties

Balance at beginning of year                    $31,921           $36,223
    Property improvements                         1,072               749
    Disposal of investment properties            (8,969)           (5,051)
Balance at end of year                          $24,024           $31,921

Accumulated Depreciation

Balance at beginning of year                    $ 8,562           $ 8,650
    Additions charged to expense                    868               999
    Disposal of investment properties            (1,461)           (1,087)
Balance at end of year                          $ 7,969           $ 8,562

<PAGE>


The  aggregate  cost of the real  estate  for  Federal  income tax  purposes  at
December  31,  1999 and 1998,  is  approximately  $32,137,000  and  $38,914,000,
respectively. The accumulated depreciation taken for Federal income tax purposes
at December 31, 1999 and 1998, is approximately $8,461,000 and $8,080,000.

Note J - Abandonment of Limited Partnership Units

In 1998,  the number of Limited  Partnership  Units  decreased by 3 units due to
Limited  Partners  abandoning  their units.  In abandoning  Limited  Partnership
Units,  a Limited  Partner  relinquishes  all right,  title and  interest in the
Partnership  as of  the  date  of  abandonment.  However,  during  the  year  of
abandonment, the Limited Partner will still be allocated his or her share of the
income or loss for that year.  The income per  limited  partnership  unit in the
accompanying  consolidated  statements of operations is calculated  based on the
number  of units  outstanding  at the  beginning  of the  year.  No  units  were
abandoned in 1999.

Note K - Operating Leases

Tenants of the commercial properties are responsible for their own utilities and
maintenance of their space, and payment of their  proportionate  share of common
area  maintenance,  utilities,  insurance  and real  estate  taxes.  Tenants are
generally not required to pay a security deposit.

As of December  31, 1999,  the  Partnership  had minimum  future  rentals  under
non-cancelable  leases with initial or remaining  terms in excess of one year as
follows (in thousands):

                              2000              $1,130
                              2001                 778
                              2002                 536
                              2003                 283
                              2004                 159
                           Thereafter              573
                                                $3,459

Note L - Segment Reporting

Description  of the types of products  and  services  from which the  reportable
segment derives its revenues:

The  Partnership  has  two  reportable  segments:   residential  and  commercial
properties.  The  Partnership's  residential  property segment consists of three
apartment  complexes in Maryland,  Michigan,  and Texas.  The Partnership  rents
apartment units for terms that are typically  twelve months or less. At December
31, 1999, the Partnership's  commercial  property segment consists of two retail
shopping  centers located in Iowa. The  Partnership  rents  commercial  space to
tenants  under  various lease terms  expiring  during 2000 through  2017.  These
properties lease space to a grocery chain,  various specialty retail outlets and
fast food enterprises and discount stores.

<PAGE>

Measurement of segment profit or loss:

The  Partnership  evaluates  performance  based on segment  profit (loss) before
depreciation.  The accounting policies of the reportable segment are the same as
those described in the summary of significant accounting policies.

Factors management used to identify the enterprise's reportable segment:

The  Partnership's  reportable  segments  consist of investment  properties that
offer different products and services.  The reportable segments are each managed
separately  because they provide  services with different  types of products and
customers.

Segment information for the years 1999 and 1998 is shown in the tables below (in
thousands). The "Other" Column includes Partnership administration related items
and income and expense not allocated to the reportable segments (in thousands).
<TABLE>
<CAPTION>

1999                                 Residential     Commercial      Other      Totals
                                                   (discontinued)
<S>                                    <C>              <C>            <C>       <C>
Rental income                          $ 3,556          $   --         $ --      $ 3,556
Other income                               225              --           82         307
Interest expense                           757              --           --         757
Depreciation                               519              --           --         519
General and administrative
  expense                                   --              --          311         311
Gain on sale of investment
  property                               1,783              --           --       1,783
Loss on extraordinary item              (1,011)             --           --      (1,011)
Segment profit (loss)                    1,483             460         (229)      1,714
Total assets                            12,123           2,554          645      15,322
Capital expenditures for
  investment properties                  1,043              29           --       1,072
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

1998                                 Residential    Commercial       Other      Totals
                                                  (discontinued)
<S>                                    <C>             <C>             <C>     <C>
Rental income                          $ 5,035         $   --          $ --    $ 5,035
Other income                               285             --            55        340
Interest expense                         1,475             --            --      1,475
Depreciation                               719             --            --        719
General and administrative
  expense                                   --             --           567        567
Gain on sale of investment
  property                               2,995             --            --      2,995
Loss on extraordinary item                (229)            --            --       (229)
Segment profit (loss)                    3,335            308          (512)     3,131
Total assets                            22,275          6,607           941     29,823
Capital expenditures for
  investment properties                    325            424            --        749
</TABLE>


Note M - Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the   Partnership,   the  General  Partner  and  several  of  their   affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging  the  acquisition  by Insignia  Financial  Group,  Inc.
("Insignia")  and  entities  which  were,  at one time,  affiliates  of Insignia
("Insignia  Affiliates") of interests in certain general partner entities,  past
tender offers by Insignia  Affiliates to acquire limited  partnership units, the
management of partnerships  by Insignia  Affiliates and the Insignia Merger (see
"Note B - Transfer  of  Control").  The  plaintiffs  seek  monetary  damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998,  the General  Partner filed a motion seeking  dismissal of the action.  In
lieu  of  responding  to the  motion,  the  plaintiffs  have  filed  an  amended
complaint.  The General Partner filed  demurrers to the amended  complaint which
were heard  February  1999.  Pending  the ruling on such  demurrers,  settlement
negotiations  commenced.  On November 2, 1999, the parties  executed and filed a
Stipulation of Settlement,  settling claims, subject to final court approval, on
behalf of the Partnership and all limited  partners who own units as of November
3, 1999. Preliminary approval of the settlement was obtained on November 3, 1999
from the  Superior  Court of the State of  California,  County of San Mateo,  at
which time the Court set a final approval  hearing for December 10, 1999.  Prior
to the December 10, 1999 hearing the Court  received  various  objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the  alleged  lack of  authority  of class  plaintiffs'  counsel  to  enter  the
settlement.  On  December  14,  1999,  the General  Partner  and its  affiliates
terminated the proposed  settlement.  Certain  plaintiffs have filed a motion to
disqualify  some of the plaintiffs'  counsel in the action.  The General Partner
does not anticipate that costs associated with this case will be material to the
Partnership's overall operations.

The  Partnership is unaware of any other pending or outstanding  litigation that
is not of a routine nature arising in the ordinary course of business.

Note N - Change in Accounting Principle

Effective  January 1, 1999, the Partnership  changed its method of accounting to
capitalize the cost of exterior  painting and major landscaping on a prospective
basis.  The  Partnership  believes  that  this  accounting  principle  change is
preferable  because it provides a better  matching of expenses  with the related
benefit of the expenditures and it is consistent with industry  practice and the
policies  of the  General  Partner.  The  effect  of the  change  in 1999 was to
increase net income by  approximately  $156,000  ($3.26 per limited  partnership
unit). The cumulative effect, had this change been applied to prior periods,  is
not material.  The accounting  principle  change will not have an effect on cash
flow,  funds  available for  distribution or fees payable to the General Partner
and affiliates.
<PAGE>

Item 8.     Changes in and  Disagreements  with  Accountant on Accounting and
            Financial Disclosures

            None.


<PAGE>

                                    PART III

Item 9.     Directors,  Executive  Officers,  Promoters and Control Persons;
            Compliance with Section 16(a) of the Exchange Act

Angeles Income Properties, Ltd. 6 (the "Partnership" or the "Registrant") has no
officers or directors.  The names of the  directors  and  executive  officers of
Angeles Realty Corporation ("ARC II" or the "General  Partner"),  their ages and
the nature of all positions with ARC II presently held by them are as follows:

Name                        Age    Position

Patrick J. Foye              42    Executive Vice President and Director

Martha L. Long               40    Senior Vice President and Controller

Patrick  J.  Foye  has been  Executive  Vice  President  and  Director  of the
Managing  General  Partner  since  October  1,  1998.  Mr.  Foye has served as
Executive  Vice  President  of AIMCO since May 1998.  Prior to joining  AIMCO,
Mr.  Foye was a partner in the law firm of  Skadden,  Arps,  Slate,  Meagher &
Flom LLP from 1989 to 1998 and was  Managing  Partner of the firm's  Brussels,
Budapest and Moscow  offices from 1992 through  1994.  Mr. Foye is also Deputy
Chairman of the Long Island Power  Authority and serves as a member of the New
York State  Privatization  Council.  He received a B.A.  from Fordham  College
and a J.D. from Fordham University Law School.

Martha L. Long has been  Senior Vice  President  and  Controller  of the General
Partner and AIMCO since October 1998, as a result of the acquisition of Insignia
Financial Group,  Inc. From June 1994 until January 1997, she was the Controller
for Insignia, and was promoted to Senior Vice President - Finance and Controller
in January 1997,  retaining  that title until  October  1998.  From 1988 to June
1994,  Ms. Long was Senior Vice  President and  Controller for The First Savings
Bank, FSB in Greenville, South Carolina.

Based solely upon a review of Forms 3 and 4 and amendments  thereto furnished to
the Registrant  under Rule 16a-3(e) during the  Registrant's  most recent fiscal
year and Form 5 and amendments  thereto furnished to the Registrant with respect
to its most recent  fiscal year,  the  Registrant  is not aware of any director,
officer,  beneficial  owner of more than ten  percent  of the  units of  limited
partnership interest in the Registrant that failed to file on a timely basis, as
disclosed in the above Forms,  reports required by Section 16(a) of the Exchange
Act during the most recent  fiscal year or prior fiscal years except as follows:
AIMCO Properties,  L.P. and its joint filers failed to timely file a Form 3 with
respect to its  acquisition  of Units and AIMCO and its joint  filers  failed to
timely file a Form 4 with respect to its acquisition of Units.

Item 10.    Executive Compensation

Neither the  director nor officers  received any  remuneration  from the General
Partner during the year ended December 31, 1999.


<PAGE>


Item 11.    Security Ownership of Certain Beneficial Owners and Management

Except as noted below, no person or entity was known by the Registrant to be the
beneficial  owner  of  more  than 5% of the  Limited  Partnership  Units  of the
Registrant as of December 31, 1999.

Entity                                  Number of Units      Percentage

AIMCO Properties, LP                         10,799            22.83%
  (an affiliate of AIMCO)
Cooper River Properties, LLC                  3,506             7.41%
  (an affiliate of AIMCO)
Insignia Properties LP                        1,956             4.13%
  (an affiliate of AIMCO)

Cooper  River  Properties,   LLC  and  Insignia  Properties  LP  are  indirectly
ultimately  owned  by  AIMCO.  Their  business  address  is  55  Beattie  Place,
Greenville, SC 29602.

AIMCO Properties,  LP is indirectly ultimately controlled by AIMCO. Its business
address is 2000 South Colorado Boulevard, Denver, CO 80222.

No  director  or officer of the  General  Partner  owns any Units.  The  General
Partner  owns 100 Units as  required by the terms of the  partnership  agreement
governing the Partnership.

The Partnership knows of no contractual arrangements, the operation of the terms
of  which  may at a  subsequent  date  result  in a  change  in  control  of the
Partnership, except for: Article 12.1 of the Agreement, which provides that upon
a vote of the limited  partners  holding  more than 50% of the then  outstanding
limited  partnership  units  the  general  partner  may  be  expelled  from  the
Partnership  upon 90 days written  notice.  In the event that successor  general
partner has been elected by limited  partners  holding more than 50% of the then
outstanding  limited  partnership  Units and if said limited  partners  elect to
continue the business of the Partnership,  the Partnership is required to pay in
cash to the expelled  general  partner an amount equal to the accrued and unpaid
management  fee,  described in Article 10 of the  Agreement  and to purchase the
general  partner's  interest in the  Partnership  on the  effective  date of the
expulsion,  which shall be an amount equal to the difference between the balance
of the general  partner's capital account and the fair market value of the share
of  distributable  net proceeds to which the general  partner would be entitled.
Such  determination of the fair market value of the share of  distributable  net
proceeds is defined in Article 12.2(b) of the Agreement.

Item 12.    Certain Relationships and Related Transactions

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

<PAGE>

The following  payments were paid or accrued to the Managing General Partner and
affiliates in 1999 and in 1998:

                                                              1999       1998
                                                              (in thousands)

   Property management fees                                   $189       $313
   Partnership management fees                                  --        104
   Lease commissions                                            --         34
   Reimbursement for services of affiliates                    205        293

During the years ended  December  31, 1999 and 1998,  affiliates  of the General
Partner  were  entitled  to  receive  5% of  gross  receipts  from  all  of  the
Registrant's  residential properties for providing property management services.
The Registrant paid to such affiliates  approximately  $189,000 and $274,000 for
the years ended  December 31, 1999 and 1998,  respectively.  For the nine months
ending  September 30, 1998,  affiliates of the General  Partner were entitled to
varying   percentages  of  gross  receipts  from  the  Registrant's   commercial
properties  for providing  property  management  services.  These  services were
performed  by  affiliates  of the General  Partner  for the nine  months  ending
September 30, 1998 and were  approximately  $39,000.  Effective  October 1, 1998
(the effective date of the Insignia  Merger),  these services for the commercial
properties were provided by an unrelated party.

An  affiliate  of the General  Partner  received  reimbursement  of  accountable
administrative expenses amounting to approximately $205,000 and $293,000 for the
years ended December 31, 1999 and 1998, respectively.

Pursuant  to  the  Partnership   Agreement  for  managing  the  affairs  of  the
Partnership, the General Partner is entitled to receive a Partnership management
fee equal to 10% of the Partnership's adjusted cash from operations.  No fee was
accrued or paid in 1999.  Approximately  $104,000 in Partnership management fees
was accrued  during the year ended  December 31, 1998 and paid in 1999.  No fees
were due in 1999.

Pursuant  to the  Partnership  Agreement,  the  General  Partner is  entitled to
receive a distribution of 3% the aggregate disposition price of sold properties.
Pursuant  to  this  provision,   the  Registrant   declared  a  distribution  of
approximately $212,000 in 1998 for the sale of Whispering Pines Mobile Home Park
which  was  subsequently  paid to the  General  Partner  during  the year  ended
December 31, 1999. The Registrant also declared and paid a distribution,  to the
General  Partner of  approximately  $285,000  in 1999 for the sale of Mesa Dunes
Mobile Home Park. These fees are subordinate to the limited partners receiving a
preferred  return,  as specified in the  Partnership  Agreement.  If the limited
partners  have  not  received  their  preferred   return  when  the  Partnership
terminates the General Partner will return these amounts to the Partnership.

The Partnership has a first mortgage to AMIT in the amount of $3,350,000,  which
is secured  by  Wakonda  Shopping  Center  and Town & Country  Shopping  Center.
Pursuant to a series of transactions, affiliates of the General Partner acquired
ownership  interests in AMIT.  On September  17, 1998,  AMIT was merged with and
into IPT. On February  26,  1999,  IPT was then merged into AIMCO.  As a result,
AIMCO became the holder of the AMIT note.  The  Partnership  paid  approximately
$300,000  and  $303,000  in  interest  expense on this note to AMIT for 1999 and
1998, respectively.

Several tender offers were made by various parties,  including affiliates of the
General Partner,  during the years ended December 31, 1999 and 1998. As a result
of these tender offers,  AIMCO and its  affiliates  currently own 16,261 limited
partnership  units in the  Partnership  representing  34.37% of the  outstanding
units.  It is  possible  that  AIMCO  or its  affiliates  will  make one or more
additional offers to acquire  additional  limited  partnership  interests in the
Partnership  for cash or in exchange for units in the operating  partnership  of
AIMCO. Under the Partnership  Agreement,  unitholders  holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters.  When
voting on matters, AIMCO would in all likelihood vote the Units it acquired in a
manner  favorable  to the  interest  of the  General  Partner  because  of their
affiliation with the General Partner.

<PAGE>

                                     PART IV

Item 13.    Exhibits and Reports on Form 8-K

      (a)   Exhibits:

            Exhibit 18, Independent Accountants' Preferability Letter for Change
            in Accounting Principle, is filed as an exhibit to this report.

            Exhibit 27, Financial Data Schedule,  is filed as an exhibit to this
            report.

      (b)   Reports on Form 8-K filed in the fourth  quarter of calendar  year
            1999:

            None.


<PAGE>


                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Exchange Act, the  Registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                    ANGELES INCOME PROPERTIES, LTD. 6

                                    By:   Angeles Realty Corporation II
                                          General Partner

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

                                    By:   /s/Martha L. Long
                                          Martha L. Long
                                          Senior Vice President
                                          and Controller

                                    Date:

In  accordance  with the Exchange  Act, this report has been signed below by the
following  persons on behalf of the Registrant and in the capacities on the date
indicated.

/s/Patrick J. Foye      Executive Vice President      Date:
Patrick J. Foye         and Director


/s/Martha L. Long       Senior Vice President         Date:
Martha L. Long          and Controller



<PAGE>


                                  EXHIBIT INDEX

Exhibit

2.1         NPI, Inc.  Stock  Purchase  Agreement,  dated as of August 17, 1995,
            incorporated  by reference to the  Partnership's  Current  Report on
            Form 8-K dated August 17, 1995.

3.1         Amended  Certificate and Agreement of the Limited  Partnership filed
            in the  Partnership's  Prospectus  dated  June  11,  1987  which  is
            incorporated herein by reference.

3.2         Second  Amended and Restated  Bylaws of IPT,  dated  October 2, 1998
            (incorporated  by reference to  Registrant's  Current Report on Form
            8-K, dated October 1, 1998.

10.1        Agreement  of Purchase  and Sale of Real  Property  with  Exhibits -
            Whispering  Pines Mobile Home Park filed in Form 8-K dated  November
            30, 1987 which is incorporated herein by reference.

10.2        Agreement of Purchase and sale of Real  Property and Exhibits - Mesa
            Dunes  Mobile  Home Park filed in Form 8-K dated  December  23, 1987
            which is incorporated herein by reference.

10.3        Beneficiary's  Statement of Assumption - Mesa Dunes Mobile Home Park
            filed in Form 8-K dated  December  23,  1987  which is  incorporated
            herein by reference.

10.4        General  Partnership  Agreement of Sunny Acres Partners - Mesa Dunes
            Mobile Home Park filed in Form 8-K dated  December 23, 1987 which is
            incorporated herein by reference.

10.5        Agreement of Purchase and Sale of Property  with  Exhibits - Wakonda
            Shopping Center and Town & Country Shopping Center filed in Form 8-K
            dated December 30, 1987 which is incorporated herein by reference.

10.6        First  Amendment  to  Agreement  of Purchase  and Sale of Property -
            Wakonda  Shopping Center and Town & Country Shopping Center filed in
            Form 8-K dated  December  30, 1987 which is  incorporated  herein by
            reference.

10.7        Agreement  of Purchase  and Sale of Real  Property  with  Exhibits -
            Homestead Apartments filed in Form 8-K dated November 10, 1988 which
            is incorporated herein by reference.

10.8        Promissory Notes Homestead  Apartments filed in Form 8-K dated March
            29, 1991 which is incorporated herein by reference.

10.9        Agreement of Purchase and Sale of Real  Property and Exhibits - Lazy
            Hollow  Apartments  filed in Form 8-K dated December 1989,  which is
            incorporated herein by reference.

10.10       Agreement  of  Purchase  and Sale of Real  Property  and  Exhibits -
            Hawthorne  Works Business Center filed in Form 8-K dated January 19,
            1990, which is incorporated herein by reference.

10.11       Promissory  Note -  Whispering  Pines filed in Form 10-K dated March
            27, 1992, which is incorporated herein by reference.

10.12       Stock  Purchase  Agreement  dated  November  24,  1992  showing  the
            purchase  of  100%  of  the  outstanding  stock  of  Angeles  Realty
            Corporation  II by  IAP  GP  Corporation,  a  subsidiary  of  MAE GP
            Corporation,  filed in Form 8-K dated  December 31,  1992,  which is
            incorporated herein by reference.

10.13       Contract to Purchase and Sell  Property - Cable Plant and CM Complex
            of  Hawthorne  Business  Works -  between  CP and CMC and  Greybeard
            Properties, LLC, dated July 1, 1996.

10.14       Assignment  and Assumption of Contracts - Cable Plant and CM Complex
            of  Hawthorne  Business  Works -  between  CP and  CMC  and  LaSalle
            National Trust, dated August 28, 1996.

10.15       Assignment  and Assumption of Contracts - Cable Plant and CM Complex
            of  Hawthorne  Business  Works -  between  CP and CMC and  Hawthorne
            Street  Properties,  LLC,  as agent of LaSalle  National  Trust,  as
            Trustee dated August 28, 1996.

10.16       Bill of Sale - Cable  Plant and CM  Complex  of  Hawthorne  Business
            Works - between CP and CMC and LaSalle  National  Trust,  as Trustee
            dated August 28, 1996.

10.17       Multifamily  Note dated November 1, 1996,  between  Angeles Income
            Properties  Ltd. 6, a California  Limited  Partnership  and Lehman
            Brothers Holdings, Inc., relating to Homestead Apartments.

10.18       Contract of Sale executed  October 8, 1997, by and between Angeles
            Income  Properties  Ltd. 6, a California  Limited  Partnership and
            Paul Callister regarding the sale of LaSalle Warehouse.

10.19       Assignment and Assumption of Leases  regarding the sale of LaSalle
            Warehouse.

10.20       Blanket  Conveyance,  Bill of Sale and  Assignment  regarding  the
            sale of LaSalle Warehouse.

10.21       Contract of Sale between  Registrant and Hometown America,  L.L.C.
            effective July 16, 1998.

10.22       Amendment  to Contract of Sale  between  Registrant  and  Hometown
            America, L.L.C. effective July 16, 1998.

10.23       Second  Amendment  to  Contract  of Sale  between  Registrant  and
            Hometown America, L.L.C. effective July 16, 1998.

10.24       Contract of Sale between Registrant and Matthew N. Follett,  L.P.,
            effective  September  8, 1998 (filed as Exhibit  10.21 on Form 8-K
            February 19, 1999).

10.25       Reinstatement   and   Amendment   to  Contract  of  Sale   between
            Registrant and Matthew N. Follett,  L.P.,  effective  December 14,
            1998 (filed as Exhibit 10.21 on Form 8-K February 19, 1999).

10.26       Multi-family  note between Granada AIPL6, L.P. and GMAC Commercial
            Mortgage Corporation dated September 27, 1999.

<PAGE>

16.1        Letter from the Registrant's former independent accountant regarding
            its  concurrence  with  the  statements  made by the  Registrant  is
            incorporated  by reference to the Exhibit  filed with Form 8-K dated
            September 1, 1993.

18          Independent  Accountants'   Preferability  Letter  for  Change  in
            Accounting Principle.

27          Financial Data Schedule.

<PAGE>

                                                                    Exhibit 18


February 7, 2000


Mr. Patrick J. Foye
Executive Vice President
Angeles Realty Corporation II
General Partner of Angeles Income Properties, Ltd. 6
55 Beattie Place
P.O. Box 1089
Greenville, South Carolina 29602

Dear Mr. Foye:

Note N of Notes to the  Consolidated  Financial  Statements  of  Angeles  Income
Properties,  Ltd. 6 included in its Form 10-KSB for the year ended  December 31,
1999  describes  a change in the method of  accounting  to  capitalize  exterior
painting and major  landscaping,  which would have been  expensed  under the old
policy.  You have advised us that you believe that the change is to a preferable
method in your  circumstances  because it provides a better matching of expenses
with the related  benefit of the  expenditures  and is consistent  with policies
currently  being used by your  industry  and  conforms  to the  policies  of the
General Partner.

There are no authoritative criteria for determining a preferable method based on
the particular circumstances; however, we conclude that the change in the method
of accounting  for exterior  painting and major  landscaping is to an acceptable
alternative  method which,  based on your business  judgment to make this change
for the reasons cited above, is preferable in your circumstances.

                                                             Very truly yours,
                                                          /s/Ernst & Young LLP


<PAGE>
                                                                  Exhibit 10.26
                                                       FHLMC Loan No. 002640244


                                MULTIFAMILY NOTE
                                     (TEXAS)

US $1,413,000.00                          As of this 27th day of September, 1999


      FOR VALUE RECEIVED, the undersigned ("Borrower") jointly and severally (if
more  than  one)  promises  to pay to the  order  of  GMAC  COMMERCIAL  MORTGAGE
CORPORATION,  a California  corporation,  the  principal sum of One Million Four
Hundred Thirteen Thousand and 00/100 Dollars (US  $1,413,000.00),  with interest
on the  unpaid  principal  balance at the  annual  rate of seven and  sixty-five
hundredths percent (7.65%).

1. Defined  Terms.  As used in this Note, (i) the term "Lender" means the holder
of this Note, and (ii) the term "Indebtedness"  means the principal of, interest
on,  or any  other  amounts  due at any time  under,  this  Note,  the  Security
Instrument  or any other Loan  Document,  including  prepayment  premiums,  late
charges,  default interest, and advances to protect the security of the Security
Instrument under Section 12 of the Security  Instrument.  "Event of Default" and
other  capitalized  terms  used but not  defined  in this  Note  shall  have the
meanings given to such terms in the Security Instrument.

2. Address for Payment. All payments due under this Note shall be payable at 650
Dresher Road, P.O. Box 1015, Horsham, Pennsylvania 19044-8015, Attn: Servicing -
Account  Manager,  or such other place as may be designated by written notice to
Borrower from or on behalf of Lender.

3. Payment of Principal  and Interest.  Principal and interest  shall be paid as
follows:

(a) Unless  disbursement of principal is made by Lender to Borrower on the first
day of the month,  interest for the period beginning on the date of disbursement
and ending on and including the last day of the month in which such disbursement
is made  shall be  payable  simultaneously  with  the  execution  of this  Note.
Interest  under  this Note  shall be  computed  on the  basis of a 360-day  year
consisting of twelve 30-day months.

(b)  Consecutive  monthly  installments  of principal and interest,  each in the
amount  of  Eleven   Thousand  Five  Hundred   Twelve  and  98/100  Dollars  (US
$11,512.98),  shall be  payable  on the first  day of each  month  beginning  on
November 1, 1999,  until the entire unpaid principal  balance  evidenced by this
Note is fully paid. Any accrued interest  remaining past due for 30 days or more
shall be added to and become part of the unpaid principal balance and shall bear
interest at the rate or rates specified in this Note, and any reference below to
"accrued  interest" shall refer to accrued interest which has not become part of
the unpaid principal balance.  Any remaining principal and interest shall be due
and  payable  on  October  1, 2019 or on any  earlier  date on which the  unpaid
principal  balance of this Note  becomes due and  payable,  by  acceleration  or
otherwise (the "Maturity Date").  The unpaid principal balance shall continue to
bear interest after the Maturity Date at the Default Rate set forth in this Note
until and including the date on which it is paid in full.

(c) Any regularly  scheduled monthly  installment of principal and interest that
is  received  by Lender  before  the date it is due shall be deemed to have been
received on the due date solely for the purpose of calculating interest due.

4.  Application of Payments.  If at any time Lender  receives,  from Borrower or
otherwise,  any amount  applicable  to the  Indebtedness  which is less than all
amounts due and payable at such time,  Lender may apply that  payment to amounts
then due and  payable in any manner and in any order  determined  by Lender,  in
Lender's  discretion.  Borrower  agrees that neither  Lender's  acceptance  of a
payment  from  Borrower in an amount that is less than all amounts  then due and
payable nor Lender's  application of such payment shall  constitute or be deemed
to  constitute  either  a  waiver  of  the  unpaid  amounts  or  an  accord  and
satisfaction.

5. Security.  The Indebtedness is secured,  among other things, by a multifamily
mortgage, deed to secure debt or deed of trust dated as of the date of this Note
(the "Security  Instrument"),  and reference is made to the Security  Instrument
for other rights of Lender as to collateral for the Indebtedness.

6.  Acceleration.  If an Event of Default has  occurred and is  continuing,  the
entire unpaid principal  balance,  any accrued interest,  the prepayment premium
payable under  Paragraph  10, if any, and all other  amounts  payable under this
Note and any other Loan  Document  shall at once become due and payable,  at the
option of Lender, without any prior notice to Borrower. Lender may exercise this
option to accelerate regardless of any prior forbearance.

7. Default Rate. So long as (a) any monthly  installment under this Note remains
past due for 30 days or more, or (b) any other Event of Default has occurred and
is  continuing,  interest  under this Note shall accrue on the unpaid  principal
balance from the earlier of the due date of the first unpaid monthly installment
or the occurrence of such other Event of Default, as applicable,  at a rate (the
"Default Rate") equal to the lesser of 4 percentage points above the rate stated
in the first  paragraph of this Note or the maximum  interest  rate which may be
collected from Borrower under  applicable law. If the unpaid  principal  balance
and all accrued  interest are not paid in full on the Maturity  Date, the unpaid
principal balance and all accrued interest shall bear interest from the Maturity
Date at the Default Rate.  Borrower also  acknowledges  that its failure to make
timely payments will cause Lender to incur additional  expenses in servicing and
processing the loan evidenced by this Note (the "Loan"),  that,  during the time
that any  monthly  installment  under this Note is  delinquent  for more than 30
days,  Lender will incur  additional costs and expenses arising from its loss of
the use of the money due and from the adverse impact on Lender's ability to meet
its other  obligations and to take advantage of other investment  opportunities,
and that it is extremely difficult and impractical to determine those additional
costs and expenses.  Borrower also  acknowledges  that, during the time that any
monthly  installment  under this Note is delinquent for more than 30 days or any
other  Event  of  Default  has  occurred  and is  continuing,  Lender's  risk of
nonpayment of this Note will be  materially  increased and Lender is entitled to
be compensated for such increased risk. Borrower agrees that the increase in the
rate of interest  payable under this Note to the Default Rate  represents a fair
and reasonable estimate,  taking into account all circumstances  existing on the
date of this Note,  of the  additional  costs and expenses  Lender will incur by
reason of the  Borrower's  delinquent  payment and the  additional  compensation
Lender is entitled to receive for the increased  risks of nonpayment  associated
with a delinquent loan.

8. Loan Charges.  Borrower and Lender intend at all times to comply with the law
of the State of Texas  governing the maximum rate or amount of interest  payable
on or in connection with this Note and the  Indebtedness  (or applicable  United
States federal law to the extent that it permits Lender to contract for, charge,
take,  reserve or receive a greater amount of interest than under Texas law). If
the applicable law is ever  judicially  interpreted so as to render usurious any
amount payable under this Note or under any other Loan  Document,  or contracted
for, charged,  taken, reserved or received with respect to the Indebtedness,  or
of  acceleration  of the maturity of this Note, or if any prepayment by Borrower
results in Borrower  having paid any interest in excess of that permitted by any
applicable  law,  then  Borrower  and Lender  expressly  intend  that all excess
amounts  collected  by Lender  shall be applied  to reduce the unpaid  principal
balance  of this Note (or,  if this  Note has been or would  thereby  be paid in
full,  shall be refunded to  Borrower),  and the  provisions  of this Note,  the
Security  Instrument  and any other Loan Documents  immediately  shall be deemed
reformed  and the amounts  thereafter  collectible  under this Note or any other
Loan  Document  reduced,  without  the  necessity  of the  execution  of any new
documents,  so as to comply  with any  applicable  law,  but so as to permit the
recovery of the fullest  amount  otherwise  payable under this Note or any other
Loan  Document.  The  right to  accelerate  the  maturity  of this Note does not
include the right to accelerate any interest which has not otherwise  accrued on
the date of such  acceleration,  and  Lender  does not  intend  to  collect  any
unearned  interest in the event of  acceleration.  All sums paid or agreed to be
paid to Lender for the use,  forbearance or detention of the Indebtedness shall,
to the extent permitted by any applicable law, be amortized, prorated, allocated
and spread throughout the full term of the Indebtedness until payment in full so
that the rate or amount of  interest  on  account of the  Indebtedness  does not
exceed the applicable usury ceiling.  Notwithstanding any provision contained in
this Note,  the Security  Instrument or any other Loan Document that permits the
compounding of interest,  including any provision by which any accrued  interest
is added to the principal amount of this Note, the total amount of interest that
Borrower is  obligated  to pay and Lender is entitled to receive with respect to
the  Indebtedness  shall not  exceed the amount  calculated  on a simple  (i.e.,
noncompounded)  interest basis at the maximum rate on principal amounts actually
advanced  to or for the  account of  Borrower,  including  all current and prior
advances and any advances made pursuant to the Security Instrument or other Loan
Documents  (such as for the  payment of taxes,  insurance  premiums  and similar
expenses or costs).

9.    Limits on Personal Liability.

(a) Except as otherwise  provided in this  Paragraph 9,  Borrower  shall have no
personal  liability  under this Note, the Security  Instrument or any other Loan
Document for the repayment of the  Indebtedness  or for the  performance  of any
other  obligations  of Borrower  under the Loan  Documents,  and  Lender's  only
recourse for the  satisfaction of the  Indebtedness  and the performance of such
obligations  shall be Lender's  exercise of its rights and remedies with respect
to the Mortgaged  Property and any other  collateral  held by Lender as security
for the Indebtedness. This limitation on Borrower's liability shall not limit or
impair  Lender's  enforcement  of  its  rights  against  any  guarantor  of  the
Indebtedness or any guarantor of any obligations of Borrower.

(b) Borrower shall be personally liable to Lender for the repayment of a portion
of the Indebtedness equal to zero percent (0%) of the original principal balance
of this Note,  plus any other amounts for which Borrower has personal  liability
under this Paragraph 9.

(c) In addition to Borrower's  personal liability under Paragraph 9(b), Borrower
shall be personally  liable to Lender for the repayment of a further  portion of
the  Indebtedness  equal to any loss or damage suffered by Lender as a result of
(1) failure of  Borrower to pay to Lender upon demand  after an Event of Default
all  Rents to which  Lender  is  entitled  under  Section  3(a) of the  Security
Instrument  and the amount of all security  deposits  collected by Borrower from
tenants  then in  residence;  (2)  failure of  Borrower  to apply all  insurance
proceeds and condemnation  proceeds as required by the Security  Instrument;  or
(3)  failure of Borrower to comply  with  Section  14(d) or (e) of the  Security
Instrument relating to the delivery of books and records, statements,  schedules
and reports.

(d) For purposes of determining  Borrower's  personal  liability under Paragraph
9(b) and Paragraph  9(c), all payments made by Borrower or any guarantor of this
Note with respect to the  Indebtedness  and all amounts  received by Lender from
the  enforcement  of its rights under the Security  Instrument  shall be applied
first to the  portion of the  Indebtedness  for which  Borrower  has no personal
liability.

(e) Borrower shall become  personally  liable to Lender for the repayment of all
of the  Indebtedness  upon the  occurrence  of any of the  following  Events  of
Default: (1) Borrower's acquisition of any property or operation of any business
not  permitted  by  Section  33 of  the  Security  Instrument;  (2)  a  Transfer
(including,  but not  limited  to,  a lien or  encumbrance)  that is an Event of
Default  under  Section  21 of the  Security  Instrument,  other than a Transfer
consisting  solely of the  involuntary  removal or  involuntary  withdrawal of a
general  partner in a limited  partnership  or a manager in a limited  liability
company; or (3) fraud or written material  misrepresentation  by Borrower or any
officer,  director,  partner,  member or employee of Borrower in connection with
the  application  for or  creation  of the  Indebtedness  or any request for any
action or consent by Lender.

(f) In addition to any personal  liability for the Indebtedness,  Borrower shall
be  personally  liable to Lender for (1) the  performance  of all of  Borrower's
obligations   under  Section  18  of  the  Security   Instrument   (relating  to
environmental  matters);  (2) the costs of any audit under  Section 14(d) of the
Security  Instrument;  and (3) any  costs  and  expenses  incurred  by Lender in
connection  with the  collection of any amount for which  Borrower is personally
liable under this  Paragraph  9,  including  fees and out of pocket  expenses of
attorneys and expert witnesses and the costs of conducting any independent audit
of Borrower's  books and records to determine the amount for which  Borrower has
personal liability.

(g) To the extent that Borrower has personal  liability  under this Paragraph 9,
Lender may exercise its rights  against  Borrower  personally  without regard to
whether  Lender has exercised any rights  against the Mortgaged  Property or any
other  security,  or pursued any rights  against any  guarantor,  or pursued any
other rights available to Lender under this Note, the Security  Instrument,  any
other Loan  Document or  applicable  law. For purposes of this  Paragraph 9, the
term "Mortgaged Property" shall not include any funds that (1) have been applied
by Borrower as required or  permitted by the  Security  Instrument  prior to the
occurrence  of an  Event of  Default  or (2)  Borrower  was  unable  to apply as
required  or  permitted  by the  Security  Instrument  because of a  bankruptcy,
receivership, or similar judicial proceeding.

10.   Voluntary and Involuntary Prepayments.

(a) A prepayment premium shall be payable in connection with any prepayment made
under this Note as provided below:

(1) Borrower may voluntarily  prepay all of the unpaid principal balance of this
Note on the last  Business Day of a calendar  month if Borrower has given Lender
at least 30 days prior  notice of its  intention to make such  prepayment.  Such
prepayment  shall be made by paying (A) the amount of principal  being  prepaid,
(B) all  accrued  interest,  (C) all other  sums due  Lender at the time of such
prepayment,  and (D) the prepayment premium  calculated  pursuant to Schedule A.
For all purposes including the accrual of interest,  any prepayment  received by
Lender on any day other than the last  calendar day of the month shall be deemed
to have been  received on the last  calendar day of such month.  For purposes of
this Note, a "Business  Day" means any day other than a Saturday,  Sunday or any
other day on which Lender is not open for business.  Borrower shall not have the
option to voluntarily prepay less than all of the unpaid principal balance.

(2) Upon  Lender's  exercise  of any  right of  acceleration  under  this  Note,
Borrower shall pay to Lender, in addition to the entire unpaid principal balance
of this  Note  outstanding  at the  time of the  acceleration,  (A) all  accrued
interest  and  all  other  sums  due  Lender,  and (B)  the  prepayment  premium
calculated pursuant to Schedule A.

(3) Any  application  by  Lender  of any  collateral  or other  security  to the
repayment of any portion of the unpaid  principal  balance of this Note prior to
the  Maturity  Date and in the absence of  acceleration  shall be deemed to be a
partial prepayment by Borrower, requiring the payment to Lender by Borrower of a
prepayment premium.  The amount of any such partial prepayment shall be computed
so as to provide to Lender a prepayment  premium computed pursuant to Schedule A
without Borrower having to pay out-of-pocket any additional amounts.

(b)  Notwithstanding  the provisions of Paragraph  10(a), no prepayment  premium
shall be payable with respect to (A) any  prepayment  made no more than 180 days
before the Maturity  Date,  or (B) any  prepayment  occurring as a result of the
application of any insurance  proceeds or condemnation  award under the Security
Instrument.

(c)   Schedule A is hereby incorporated by reference into this Note.

(d) Any  permitted  or  required  prepayment  of less than the unpaid  principal
balance of this Note shall not extend or postpone the due date of any subsequent
monthly  installments or change the amount of such  installments,  unless Lender
agrees otherwise in writing.

(e) Borrower  recognizes that any prepayment of the unpaid principal  balance of
this Note,  whether  voluntary or  involuntary  or  resulting  from a default by
Borrower,  will result in Lender's incurring loss, including  reinvestment loss,
additional expense and frustration or impairment of Lender's ability to meet its
commitments  to third  parties.  Borrower  agrees to pay to Lender  upon  demand
damages  for the  detriment  caused by any  prepayment,  and  agrees  that it is
extremely  difficult  and  impractical  to ascertain the extent of such damages.
Borrower  therefore  acknowledges  and agrees that the  formula for  calculating
prepayment  premiums set forth on Schedule A represents a reasonable estimate of
the damages Lender will incur because of a prepayment.

(f) Borrower further acknowledges that the prepayment premium provisions of this
Note are a material part of the  consideration  for the Loan,  and  acknowledges
that the terms of this Note are in other  respects more favorable to Borrower as
a  result  of the  Borrower's  voluntary  agreement  to the  prepayment  premium
provisions.

11. Costs and  Expenses.  Borrower  shall pay all expenses and costs,  including
fees and  out-of-pocket  expenses of attorneys and expert witnesses and costs of
investigation,  incurred by Lender as a result of any default under this Note or
in  connection  with  efforts to collect  any amount due under this Note,  or to
enforce  the  provisions  of any of the other Loan  Documents,  including  those
incurred in post-judgment  collection  efforts and in any bankruptcy  proceeding
(including  any action  for relief  from the  automatic  stay of any  bankruptcy
proceeding) or judicial or non-judicial foreclosure proceeding.

12.  Forbearance.  Any  forbearance  by Lender in exercising any right or remedy
under  this  Note,  the  Security  Instrument,  or any other  Loan  Document  or
otherwise  afforded by applicable  law, shall not be a waiver of or preclude the
exercise of that or any other right or remedy.  The  acceptance by Lender of any
payment after the due date of such  payment,  or in an amount which is less than
the required payment,  shall not be a waiver of Lender's right to require prompt
payment  when due of all other  payments or to exercise any right or remedy with
respect to any  failure to make  prompt  payment.  Enforcement  by Lender of any
security for  Borrower's  obligations  under this Note shall not  constitute  an
election by Lender of remedies so as to preclude the exercise of any other right
or remedy available to Lender.

13.  Waivers.  Presentment,  demand,  notice  of  dishonor,  protest,  notice of
acceleration,  notice of intent to demand or  accelerate  payment  or  maturity,
presentment  for  payment,  notice  of  nonpayment,   grace,  and  diligence  in
collecting  the  Indebtedness  are  waived by  Borrower  and all  endorsers  and
guarantors of this Note and all other third party obligors.

14.  Commercial  Purpose.  Borrower  represents  that the  Indebtedness is being
incurred  by  Borrower  solely for the  purpose  of  carrying  on a business  or
commercial enterprise, and not for personal, family or household purposes.

15.  Counting  of  Days.  Except  where  otherwise  specifically  provided,  any
reference in this Note to a period of "days" means  calendar  days, not Business
Days.

16. Governing Law. This Note shall be governed by the law of the jurisdiction in
which the Land is located.

17.  Captions.  The captions of the paragraphs of this Note are for  convenience
only and shall be disregarded in construing this Note.

18. Notices. All notices, demands and other communications required or permitted
to be given by  Lender  to  Borrower  pursuant  to this  Note  shall be given in
accordance with Section 31 of the Security Instrument.

19. Consent to  Jurisdiction  and Venue.  Borrower  agrees that any  controversy
arising under or in relation to this Note shall be litigated  exclusively in the
jurisdiction  in which the Land is located (the  "Property  Jurisdiction").  The
state and federal  courts and  authorities  with  jurisdiction  in the  Property
Jurisdiction  shall have exclusive  jurisdiction  over all  controversies  which
shall arise under or in relation to this Note. Borrower  irrevocably consents to
service,  jurisdiction,  and venue of such  courts for any such  litigation  and
waives  any other  venue to which it might be  entitled  by virtue of  domicile,
habitual residence or otherwise.

20. WAIVER OF TRIAL BY JURY.  BORROWER AND LENDER EACH (A) AGREES NOT TO ELECT A
TRIAL  BY JURY  WITH  RESPECT  TO ANY  ISSUE  ARISING  OUT OF  THIS  NOTE OR THE
RELATIONSHIP BETWEEN THE PARTIES AS LENDER AND BORROWER THAT IS TRIABLE OF RIGHT
BY A JURY AND (B) WAIVES  ANY RIGHT TO TRIAL BY JURY WITH  RESPECT TO SUCH ISSUE
TO THE EXTENT THAT ANY SUCH RIGHT  EXISTS NOW OR IN THE  FUTURE.  THIS WAIVER OF
RIGHT  TO  TRIAL  BY JURY IS  SEPARATELY  GIVEN  BY EACH  PARTY,  KNOWINGLY  AND
VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL.

      ATTACHED SCHEDULES.  The following Schedules are attached to this Note:

             X       Schedule A    Prepayment Premium (required)

             X       Schedule B    Modifications to Multifamily Note

      IN WITNESS  WHEREOF,  Borrower has signed and delivered this Instrument or
has caused this  Instrument  to be signed and  delivered by its duly  authorized
representative.

                                   GRANADA AIPL6, A TEXAS LIMITED PARTNERSHIP, a
                                   Texas limited partnership

                                   By:   Granada AIPL6, Inc.,
                                         a Texas corporation,
                                         its general partner

                                   By
                                   Name:
                                   Title:

                                   74-2640737
                                   Borrower's Social Security/Employer ID Number


<PAGE>



PAY TO THE ORDER OF FEDERAL HOME LOAN MORTGAGE  CORPORATION,  WITHOUT  RECOURSE,
THIS 28TH DAY OF SEPTEMBER, 1999.

GMAC COMMERCIAL MORTGAGE CORPORATION, a
California corporation

By:
   Donald W. Marshall
   Vice President


<PAGE>



                                   SCHEDULE A

                               PREPAYMENT PREMIUM

Any prepayment premium payable under Paragraph 10 of this Note shall be computed
as follows:

(a) If the prepayment is made between the date of this Note and the date that is
180 months after the first day of the first calendar month following the date of
this Note (the "Yield Maintenance Period"),  the prepayment premium shall be the
greater of:

(i) of the unpaid principal balance of this Note; or

(ii) the product obtained by multiplying:

(A) the amount of principal being prepaid,

                        by

(B) the excess (if any) of the Monthly  Note Rate over the Assumed  Reinvestment
    Rate,

                        by

(C)   the Present Value Factor.

      For purposes of subparagraph (ii), the following definitions shall apply:

Monthly Note Rate:  one-twelfth  (1/12) of the annual interest rate of the Note,
expressed as a decimal calculated to five digits.

Prepayment  Date: in the case of a voluntary  prepayment,  the date on which the
prepayment is made; in any other case, the date on which Lender  accelerates the
unpaid principal balance of the Note.

Assumed Reinvestment Rate: one-twelfth (1/12) of the yield rate as of the date 5
Business Days before the Prepayment  Date, on the 9.25% U.S.  Treasury  Security
due  February 1, 2016,  as reported in The Wall Street  Journal,  expressed as a
decimal  calculated  to five digits.  In the event that no yield is published on
the  applicable  date for the Treasury  Security  used to determine  the Assumed
Reinvestment  Rate,  Lender,  in its discretion,  shall select the  non-callable
Treasury Security  maturing in the same year as the Treasury Security  specified
above with the  lowest  yield  published  in The Wall  Street  Journal as of the
applicable  date.  If the  publication  of such yield  rates in The Wall  Street
Journal is  discontinued  for any reason,  Lender shall select a security with a
comparable rate and term to the Treasury  Security used to determine the Assumed
Reinvestment  Rate.  The  selection  of an alternate  security  pursuant to this
Paragraph shall be made in Lender's discretion.


<PAGE>


Present  Value  Factor:  the factor that  discounts  to present  value the costs
resulting  to Lender from the  difference  in interest  rates  during the months
remaining in the Yield Maintenance Period,  using the Assumed  Reinvestment Rate
as the  discount  rate,  with  monthly  compounding,  expressed  numerically  as
follows:

                                  [OBJECT OMITTED]

      n = number of months remaining in Yield Maintenance Period

      ARR = Assumed Reinvestment Rate

(b) If the  prepayment  is made after the  expiration  of the Yield  Maintenance
Period but more than 180 days before the Maturity Date,  the prepayment  premium
shall be 1.0% of the unpaid principal balance of this Note.


<PAGE>



                                   SCHEDULE B

                        MODIFICATIONS TO MULTIFAMILY NOTE

1.   The  following  paragraph  is  added  to  Paragraph  8 of the  Note  ("Loan
     Charges"):

            Notwithstanding  any contrary  provision  contained in this Note, if
            any sum payable  under this Note is not paid  within  three (3) days
            from  the date on which  it is due or the  earliest  time  permitted
            under  applicable law for a late payment charge to accrue,  Borrower
            shall pay to Lender upon demand an amount equal to the lesser of (a)
            five  percent  (5%) of such  unpaid  sum or (b) the  maximum  amount
            permitted  by  applicable  law in order to defray a  portion  of the
            expenses   incurred  by  Lender  in  handling  and  processing  such
            delinquent  payment and to compensate Lender for the loss of the use
            of such  delinquent  payment.  If the day when any payment  required
            under  this  Note  is due is  not a  Business  Day  (as  defined  in
            Paragraph 10 of the Note),  then  payment  shall be due on the first
            Business Day thereafter.

2.   The first sentence of 7 of the Note ("Default  Rate") is hereby deleted and
     replaced with the following:

            So long as (a) any monthly  installment under this Note remains past
            due for more than thirty (30) days or (b) any other event of Default
            has  occurred  and is  continuing,  interest  under  this Note shall
            accrue on the unpaid  principal  balance from the earlier of the due
            date of the first unpaid  monthly  installment  or the occurrence of
            such other Event of Default, as applicable,  at a rate (the "Default
            Rate")  equal to the lesser of (1) the maximum  interest  rate which
            may be  collected  from  Borrower  under  applicable  law or (2) the
            greater of (i) three  percent (3%) above the  Interest  Rate or (ii)
            four percent  (4.0%) above the  then-prevailing  Prime Rate. As used
            herein,  the term  "Prime  Rate"  shall  mean  the rate of  interest
            announced by The Wall Street Journal from time to time as the "Prime
            Rate".

3.   Paragraph  9(c) of the Note is  amended to add the  following  subparagraph
     (4):

      (4) failure by Borrower to pay the amount of the water and sewer  charges,
taxes, fire, hazard or other insurance premiums, ground rents in accordance with
the terms of the Security Instrument.