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

                                    FORM 10-K

(Mark One)

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

         For the fiscal year ended December 31, 1998

                                       OR

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

         For the transition period from                     to                 
                                        -------------------    -----------------

         Commission file number 0-17660

                                 METRIC PARTNERS
                          GROWTH SUITE INVESTORS, L.P.,

                        a California Limited Partnership
             (Exact name of Registrant as specified in its charter)

           CALIFORNIA                                   94-3050708
     ----------------------                 ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

          1 California Street                       
       San Francisco, California                        94111-5415
   --------------------------------         ------------------------------------
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code: (415) 678-2000
                                                    (800) 347-6707 in all states

Securities registered pursuant to Section 12(b) of the Act:  None
Securities registered pursuant to Section 12(g) of the Act:  Limited Partnership
                                                             Assignee Units

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.   Yes   X    No
                                         -----     -----

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]

No market for the Limited  Partnership  Assignee  Units  exists and  therefore a
market value for such Units cannot be determined.


<PAGE>
                  METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                        a California Limited Partnership
                                     PART I

Item 1.  Business.

Metric Partners Growth Suite Investors,  L.P., a California Limited  Partnership
(the "Partnership"),  was organized in 1984 under the California Uniform Limited
Partnership  Act. On April 1, 1997,  Metric  Holdings,  Inc.  and Metric  Realty
Corp.,  the  partners of the  Managing  General  Partner,  Metric  Realty,  were
involved in certain corporate transactions.  Pursuant to these transactions, (i)
Metric Holdings,  Inc. was merged into a newly-formed  corporation  known as SSR
Realty  Advisors,  Inc.  ("SSR  Realty"),  which became the managing  partner of
Metric  Realty,  and (ii) Metric  Realty Corp.  was merged into Metric  Property
Management,  Inc.,  a  subsidiary  of SSR Realty.  Accordingly,  the partners of
Metric  Realty are now SSR Realty and Metric  Property  Management,  Inc.  After
consummation of these  transactions,  both partners of Metric Realty continue to
be wholly-owned  subsidiaries of Metropolitan  Life Insurance  Company,  as were
both  partners  prior to the  occurrence  of such  transactions.  The  associate
general  partner of the  Partnership  is GHI  Associates  II, L.P., a California
Limited  Partnership.  The general partner of GHI Associates II is Metric Realty
and the limited partner is Prudential-Bache Properties, Inc.

The Partnership's Registration Statement filed pursuant to the Securities Act of
1933 (No.  33-8610)  was  declared  effective  by the  Securities  and  Exchange
Commission on April 14, 1988. The Partnership  marketed its securities  pursuant
to its  Prospectus  dated  April 14,  1988,  which was  thereafter  supplemented
(hereinafter  the  "Prospectus").  This Prospectus was filed with the Securities
and Exchange Commission pursuant to Rule 424(b) of the Securities Act of 1933.

The principal  business of the  Partnership is to acquire,  hold for investment,
manage and ultimately sell all-suite,  extended stay hotels,  which are operated
under franchise licenses from Residence Inn by Marriott, Inc. The Partnership is
a "closed" limited partnership real estate syndicate.  For a further description
of the  Partnership's  business,  see the sections  entitled  "Risk Factors" and
"Investment Objectives and Policies" in the Prospectus.

Beginning  in  April  1988,  the  Partnership  offered  $60,000,000  in  Limited
Partnership Assignee Units. The offering was closed on June 30, 1989, with total
funding of  $59,932,000.  The net proceeds of the offering were used to purchase
ten hotel properties,  which are described in Item 2. The acquisition activities
of the  Partnership  were  completed on March 16,  1990,  with the purchase of a
final hotel property,  the Residence Inn - Altamonte  Springs.  Since that time,
the principal  activity of the Partnership  has been managing its portfolio.  As
the Partnership's  long-term goal is to ultimately liquidate the portfolio,  the
markets where the hotels are located have been monitored on an ongoing basis for
potential sales opportunities.  The Partnership entered into a purchase and sale
agreement for the Residence  Inn-Atlanta  (Perimeter  West) with an unaffiliated
buyer and sold the  property  on  October  3,  1995.  In 1997,  the  Partnership
marketed eight of the nine remaining  hotels for sale, and on December 30, 1997,
the hotels were sold to an unaffiliated  buyer. The Partnership's sole remaining
property  is the  Residence  Inn -  Nashville.  On April 1,  1998,  the  balloon
mortgage  payment for this  property  became due and payable.  In exchange for a
six-month forbearance  agreement,  during which time the Partnership pursued the
potential  sale of the  property,  the  lender  received a  principal  reduction
payment of $100,000,  reimbursement of $20,000 of its costs, and regular monthly
debt service  payments  through  November 1, 1998. The Partnership  subsequently
determined that a sale of the property was not feasible, and, as the forbearance
agreement has expired, it is likely that the property will be disposed of in the
first half of 1999. The Partnership is currently  negotiating with the lender to
accept the deed in lieu of  foreclosure  and to assume the  Marriott  management
contract,  thereby relieving the Partnership of substantial contract termination
fees that it would  likely have to pay in the event of a  foreclosure  sale.  In
this regard,  the Partnership has made the regular monthly debt service payments
for the months of December 1998,  January,  February and March 1999, and intends
to make the April 1999 payment.  While the Partnership  believes that the ground
lease  associated  with the  property  would  be  terminated  in the  event of a
foreclosure,  or assumed by the lender in the event of a deed in lieu  transfer,
the  Partnership  may be obligated to pay deferred rent under the lease.  Please
refer to Part II, Item 7 and Item 8, Notes 5 and 6 to the financial statements.

Both the income and expenses of operating  the  property  which the  Partnership
owns  are  subject  to  factors  outside  the  Partnership's  control,  such  as
oversupply  of similar  properties  resulting  from  overbuilding,  increases in
unemployment or population  shifts, or changes in patterns of needs of users. In
addition,  there are risks  inherent  in owning and  operating  hotels and other
lodging  facilities  because such  properties are management and labor intensive
and  especially  susceptible  to the  impact of  economic  and other  conditions
outside the control of the Partnership.


                                      -2-
<PAGE>
Expenses,  such as local real estate taxes and management expenses,  are subject
to change and cannot  always be reflected in room rate  increases  due to market
conditions.  The  profitability and marketability of developed real property may
be adversely affected by changes in general and local economic conditions and in
prevailing  interest  rates,  and  favorable  changes in such  factors  will not
necessarily enhance the profitability or marketability of such property.

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 managing  general partner 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
remaining property owned by the Partnership.

Environmental  site assessments were performed for each of the properties at the
time of property acquisition.  No material adverse  environmental  conditions or
liabilities  were  identified at that time, nor were any  identified  during due
diligence conducted in conjunction with the sale of the Partnership's hotels. In
no case has the Partnership received notice that it is a potentially responsible
party with respect to an environmental clean-up site.

The Partnership and the hotel management company maintain property and liability
insurance on the Partnership's remaining property. The Partnership believes such
coverage to be adequate.

The Partnership is subject to the general competitive  conditions of the lodging
industry.  In addition,  the  Partnership's  property  competes in an area which
contains numerous other properties which may be considered competitive.

Item 2.  Properties.

A description of the hotel properties which the Partnership owns or has owned is
as follows:

<TABLE>
<CAPTION>
Name and Location                                             Rooms    Date of Purchase  Date of Sale
-----------------                                             -----    ----------------  ------------
<S>                                                             <C>          <C>            <C>
Residence Inn-Ontario                                           200          04/88          12/97
 2025 East D Street, Ontario, California

Residence Inn-Fort Wayne                                         80          06/88          12/97
 4919 Lima Road, Fort Wayne, Indiana

Residence Inn-Columbus East                                      80          06/88          12/97
 2084 South Hamilton Road, Columbus, Ohio

Residence Inn-Indianapolis                                       88          06/88          12/97
 3553 Founders Road, Indianapolis, Indiana

Residence Inn-Lexington                                          80          06/88          12/97
 1080 Newtown Pike, Lexington, Kentucky

Residence Inn-Louisville                                         96          06/88          12/97
 120 North Hurtsbourne Lane, Louisville, Kentucky

Residence Inn-Winston-Salem                                      88          06/88          12/97
 7835 North Point Blvd., Winston-Salem, North Carolina

Residence Inn-Nashville (Airport)                               168          05/89          N/A
 2300 Elm Hill Pike, Nashville, Tennessee

Residence Inn-Atlanta (Perimeter West)                          128          10/89          10/95
 6096 Barfield Road, Atlanta, Georgia

Residence Inn-Altamonte Springs                                 128          03/90          12/97
 270 Douglas Avenue, Altamonte Springs, Florida

</TABLE>


                                      -3-
<PAGE>
See  the  Financial   Statements  in  Item  8  for  information   regarding  any
encumbrances to which the properties of the Partnership are or were subject.

Occupancy  and room rates for the years ended  December 31, 1998,  1997 and 1996
are as follows:

<TABLE>
<CAPTION>

                                                                Average                     Average
                                                           Occupancy Rate (%)          Daily Room Rate ($)    
                                                           ------------------          -------------------    
                                                         1998     1997     1996       1998    1997    1996
                                                         ----     ----     ----       ----    ----    ----
<S>                                                       <C>       <C>     <C>      <C>      <C>     <C> 
HOTELS:
Residence Inn-Ontario(2)........................          ---       71      74         ---    80.20   69.60
Residence Inn-Columbus East(2)..................          ---       88      87         ---    74.22   74.54
Residence Inn-Fort Wayne(2).....................          ---       85      88         ---    66.25   67.45
Residence Inn-Indianapolis(2)...........                  ---       76      82         ---    79.25   76.06
Residence Inn-Lexington(2)..............                  ---       89      91         ---    77.49   71.92
Residence Inn-Louisville(2).............                  ---       90      86         ---    91.95   86.31
Residence Inn-Winston-Salem(2)........                    ---       85      84         ---    79.36   75.95
Residence Inn-Nashville (Airport).......                   83       82      76       83.23    85.71   78.74
Residence Inn-Atlanta (Perimeter West) (1)                ---      ---     ---         ---      ---     ---
Residence Inn-Altamonte Springs(2)..............          ---       84      86         ---    91.45   83.73

<FN>
(1) Sold in October 1995.
(2) Sold in December 1997.
</FN>
</TABLE>

                               Project Operations

Project  Operations  for the years ended  December 31,  1998,  1997 and 1996 are
shown on the  following  three  pages.  Project  Operations  tables  reflect the
components of income or loss (before gain on sale) for each  property  which the
Partnership  owns  (or  has  owned)  and  the  components  of  the  loss  at the
Partnership  level.  In  addition,  non-cash  items  such  as  depreciation  and
amortization  are shown.  The tables  also  reflect  principal  payments  on the
Partnership's notes payable and capital improvements.


                                      -4-
<PAGE>

                  METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.
                        a California Limited Partnership

                  Project Operations of the Residence Inns for
                        the Year Ended December 31, 1998
                                     (000's)

                                                            Sold
                                Partnership   Nashville    Hotels     Total
                                -----------   ---------    ------     -----
REVENUES:
Hotel operations:
  Rooms                           $     0      $ 4,241      $  0     $ 4,241
  Telephone and other                   0          204         0         204
                                  -------      -------      ----     -------
Hotel operations                        0        4,445         0       4,445
Interest and other                    726            0         0         726
                                  -------      -------      ----     -------
Total revenues                        726        4,445         0       5,171
                                  -------      -------      ----     -------

EXPENSES:
Hotel operations:
  Rooms                                 0          936         0         936
  Administrative                        0          577        34         611
  Marketing                             0          464         0         464
  Energy                                0          230         0         230
  Repair and maintenance                0          221         0         221
  Management fees                       0          152         0         152
  Property taxes                        0          112         0         112
  Other                                 0          258         0         258
                                  -------      -------      ----     -------
Hotel operations                        0        2,950        34       2,984
Depreciation and other
  amortization                          0          533         0         533
Interest                                0          853         6         859
General and administrative          1,023            0         0       1,023
Impairment provision for asset
  to be disposed of                     0          195         0         195
                                  -------      -------      ----     -------
Total expenses                      1,023        4,531        40       5,594
                                  -------      -------      ----     -------
INCOME(LOSS) (1)                     (297)         (86)      (40)       (423)

Plus non-cash items - net               0          728         0         728
Less notes payable
  principal payments                    0          222         0         222
                                  -------      -------      ----     -------
Project operations                   (297)         420       (40)         83

Capital Improvements                    0          262         0         262
                                  -------      -------      ----     -------
Project operations after
  capital improvements            ($  297)     $   158      ($40)    ($  179)
                                  =======      =======      ====     =======

Occupancy                                          83%                   83%
ADR                                             $83.23                $83.23

(1) Does not include gain on sale of property.

                                      -5-

<PAGE>
<TABLE>
                  METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.
                        a California Limited Partnership

                  Project Operations of the Residence Inns for
                        the Year Ended December 31, 1997
                                     (000's)
<CAPTION>
                               Columbus  Fort    Indian-            Louis-  Winston   Nash-          Altamonte
                      Ontario   (East)   Wayne   apolis  Lexington  ville    Salem    ville   Atlanta Springs Partnership Total
                      -------   -----    -----   ------  ---------  ------   -----    -----   ------- ------- ----------- -----
<S>                    <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>     <C>     <C>      <C>      <C>  
REVENUES:
Hotel operations:
  Rooms                $4,170   $1,905   $1,636   $1,936   $2,018   $2,883   $2,162   $4,285     $0   $3,592   $   0    $24,587
  Telephone and other     230       73       72       68      122      154      126      221      0      125       0      1,191
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------
Hotel operations        4,400    1,978    1,708    2,004    2,140    3,037    2,288    4,506      0    3,717       0     25,778
Interest and other          0        0        0        0        0        0        0        0      0        0     415        415
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------
Total revenues          4,400    1,978    1,708    2,004    2,140    3,037    2,288    4,506      0    3,717     415     26,193
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------

EXPENSES:
Hotel operations:
  Rooms                   827      465      340      499      330      523      493    1,007      0      739       0      5,223
  Administrative          545      282      211      234      298      388      252      400      0      398       0      3,008
  Marketing               474      198      168      208      200      303      252      489      0      385       0      2,677
  Energy                  249      113       94       94       79       91      118      234      0      190       0      1,262
  Repair and
   maintenance            235      126       77      134      126      133      139      299      0      184       0      1,453
  Management fees         150       59       67       60       97      140       99      150      0      183       0      1,005
  Property taxes           95       88       47       14       50       76       85      116      0      160       0        731
  Other                   174       56       52       50       66       85       76      311      0      105       0        975
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------
Hotel operations        2,749    1,387    1,056    1,293    1,246    1,739    1,514    3,006      0    2,344       0     16,334
Depreciation and
 other amortization       259      115      120      141      139      148      141      520      0      176       0      1,759
Interest                  855      273      289      335      326      376      330      861      0      682       0      4,327
General and
 administrative             0        0        0        0        0        0        0        0      0        0     959        959
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------
Total expenses          3,863    1,775    1,465    1,769    1,711    2,263    1,985    4,387      0    3,202     959     23,379
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------
INCOME(LOSS) (1)          537      203      243      235      429      774      303      119      0      515    (544)     2,814

Plus non-cash
 items-net                259      119      125      147      144      154      146      520      0      348       0      1,962
Less notes payable
 principal payments         0       20       21       25       24       28       24      133      0       91       0        366
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------
Project operations        796      302      347      357      549      900      425      506      0      772    (544)     4,410

Capital Improvements      261      284      121      225      118      161      389      428      0      263       0      2,250
                       ------   ------   ------   ------   ------   ------   ------   ------     --   ------   -----    -------
Project operations
 after capital
 improvements          $  535   $   18   $  226   $  132   $  431   $  739   $   36   $   78     $0   $  509   ($544)   $ 2,160
                       ======   ======   ======   ======   ======   ======   ======   ======     ==   ======   =====    =======

Occupancy                  71%      88%      85%      76%      89%      90%      85%      82%     0%      84%                82%
ADR                    $80.20   $74.22   $66.25   $79.25   $77.49   $91.95   $79.36   $85.71  $0.00   $91.45            $ 81.77

<FN>
(1) Does not include gain on sale of properties.
</FN>
</TABLE>
                                      -6-
<PAGE>
<TABLE>
                  METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.
                        a California Limited Partnership

                  Project Operations of the Residence Inns for
                        the Year Ended December 31, 1996
                                     (000's)
<CAPTION>
                             Columbus  Fort     Indian-             Louis-   Winston     Nash-          Altamonte
                     Ontario  (East)   Wayne    apolis   Lexington  ville     Salem      ville   Atlanta Springs Partnership  Total
                     -------  -----    -----    ------   ---------  ------    -----      -----   ------- ------- -----------  -----
<S>                  <C>      <C>      <C>      <C>        <C>      <C>      <C>        <C>      <C>      <C>      <C>       <C>
REVENUES:
Hotel operations:
  Rooms              $3,843   $1,923   $1,753   $ 2,031    $1,947   $2,653   $ 2,082    $ 3,744    $ 0    $3,412   $     0   $23,388
  Telephone and other   242       82       98        94       140      160       134        148      0       124         0     1,222
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------
Hotel operations      4,085    2,005    1,851     2,125     2,087    2,813     2,216      3,892      0     3,536         0    24,610
Interest and other        0        0        0         0         0        0         0          0      0         0       435       435
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------
Total revenues        4,085    2,005    1,851     2,125     2,087    2,813     2,216      3,892      0     3,536       435    25,045
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------

EXPENSES:
Hotel operations:
  Rooms                 698      458      366       490       342      482       444        930      0       689         0     4,899
  Administrative        467      254      234       287       287      270       287        627      9       379         0     3,101
  Marketing             468      198      197       259       248      310       252        451      0       379         0     2,762
  Energy                245      109       95       114        88      100       115        239      0       176         0     1,281
  Repair and
   maintenance          202      115       88       123       131      121       146        320      0       165         0     1,411
  Management fees       123       74       89        64        76      115        94        117      0       164         0       916
  Property taxes         94       71       29        76        52       77        63        112      0       164         0       738
  Other                 146       60       51        48        70       83        66        316      0        77         0       917
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------
Hotel operations      2,443    1,339    1,149     1,461     1,294    1,558     1,467      3,112      9     2,193         0    16,025
Depreciation and
 other amortization     505      218      224       264       258      301       263        496      0       404         0     2,933
Interest                855      277      291       337       328      379       333        872      0       678         0     4,350
General and
 administrative           0        0        0         0         0        0         0          0      0         0     1,216     1,216
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------
Total expenses        3,803    1,834    1,664     2,062     1,880    2,238     2,063      4,480      9     3,275     1,216    24,524
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------
INCOME(LOSS)            282      171      187        63       207      575       153       (588)    (9)      261      (781)      521

Plus non-cash
  items-net             505      222      228       269       263      307       268        496      0       564         0     3,122
Less notes payable
  principal payments      3       18       19        22        22       25        22        129      0       100         0       360
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------
Project operations      784      375      396       310       448      857       399       (221)    (9)      725      (781)    3,283

Capital Improvements     84      179      276       319       361      221       430        548      0       153         0     2,571
                     ------   ------   ------   -------    ------   ------   -------    -------    ---    ------   -------   -------
Project operations
  after capital
  improvements       $  700   $  196   $  120   ($    9)   $   87   $  636   ($   31)   ($  769)   ($9)   $  572   ($  781)  $   712
                     ======   ======   ======   =======    ======   ======   =======    =======    ===    ======   =======   =======


Occupancy               74%      87%      88%       82%       91%      86%       84%        76%     0%       86%                 82%
ADR                  $69.60   $74.54   $67.45   $ 76.06    $71.92   $86.31   $ 75.95    $ 78.74  $0.00    $83.73             $ 76.13
</TABLE>
                                      -7-

<PAGE>

Item 3.  Legal Proceedings.

There are no material  pending legal  proceedings to which the  Partnership is a
party or to which any of its assets are subject, except the following:

Metric Partners Growth Suite Investors,  L.P. vs. Kenneth E. Nelson,  The Nelson
Group, et al., San Francisco County Superior Court, Case No. 928065.

Nashville  Lodging Company vs. Metric Partners Growth Suite Investors,  L.P., et
al., Circuit Court, State of Wisconsin, Case No. 94CV001212.

Orlando  Residence,  Ltd.  (Plaintiff) vs.  Nashville  Lodging  Company,  Metric
Partners  Growth Suite  Investors,  L.P., et al.  (Defendants);  Metric Partners
Growth Suite  Investors,  L.P.  (Third Party  Plaintiff) vs. 2300 Elm Hill Pike,
Inc. et al.  (Third  Party  Defendant),  Tennessee  Chancery  Court for Davidson
County, Case No. 92-3086-III.

Orlando  Residence,  Ltd.  (Plaintiff)  vs.  2300 Elm Hill  Pike,  Inc.,  et al.
(Defendants/Third  Party Plaintiffs) vs. Metric Partners Growth Suite Investors,
L.P. (Third Party Defendant), Tennessee Chancery Court for Davidson County, Case
No. 94-1911-I.

Metric Partners Growth Suite Investors, L.P. vs. Nashville Lodging Co., 2300 Elm
Hill Pike, Inc., Orlando Residence,  Ltd., and LaSalle National Bank, as trustee
under that certain pooling and servicing agreement, dated July 11, 1995, for the
holders of the WHP Commercial Mortgage Pass Through Certificates,  Series 1995C1
and Robert Holland,  Trustee,  Chancery Court for Davidson County, in Nashville,
Tennessee,  Case No. 96-1405-III.  [Proceeding concluded in March 1999; see Part
II, Item 8, Note 8 to the financial statements.]

Kenneth E.  Nelson  and  Nashville  Lodging  Co.,  vs.  Metric  Realty et.  al.,
Tennessee Chancery Court for Davidson County, Case No. 97-2189-III.

For  information  regarding  these  lawsuits,  see  Management's  Discussion and
Analysis of Financial  Condition and Results of Operations  and Part II, Item 8,
Note 8 to the financial statements.

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

No matter was submitted to a vote of security  holders during the period covered
by this report.

                                     PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters.

The  Limited   Partnership   Assignee  Unit  holders  are  entitled  to  certain
distributions as provided in the Partnership  Agreement.  From inception through
April 9, 1998, Assignee Unit holders have received distributions from operations
and sales ranging from $611 - $704 for each $1,000 limited partnership  assignee
Unit,  inclusive of $310 from sales proceeds.  No market for Limited Partnership
Assignee Units exists, nor is one expected to develop.

As  of  December  31,  1998,  the  approximate  number  of  holders  of  Limited
Partnership Assignee Units was as follows:

     Title of Class                                 Number of Record Holders*
     --------------                                 -------------------------

     Limited Partnership Assignee Units..................     4,405

*Number of Investments


                                      -8-
<PAGE>
Item 6.  Selected Financial Data.

The following  represents  selected  financial data for Metric  Partners  Growth
Suite Investors,  L.P., a California Limited  Partnership,  for each of the five
years  in the  period  ended  December  31,  1998.  The data  should  be read in
conjunction with the financial statements included elsewhere herein.
<TABLE>
<CAPTION>

                                                                             For the Year Ended
                                                                                 December 31
                                                              ------------------------------------------------
                                                                1998(2)    1997     1996      1995      1994
                                                               -------     ----     ----      ----      ----
                                                                 (amounts in thousands except per unit data)
<S>                                                           <C>        <C>      <C>      <C>        <C> 
 Total Revenues                                               $  5,171   $26,193  $25,045  $ 26,107   $ 25,008
                                                              ========   =======  =======  ========   ========
 Net Income (Loss):
     Income (Loss) Before Gain on Sale of Properties          $   (423)  $ 2,814  $   521  $     69   $   (947)
     Gain on Sale of Properties                                    300     7,505     --       3,275       --
                                                              --------   -------  -------  --------   --------

 Net Income(Loss)                                             $   (123)  $10,319  $   521  $  3,344   $   (947)
                                                              ========   =======  =======  ========   ========

 Net Income (Loss) per Limited Partnership Assignee Unit(1):
     Income (Loss) Before Gain on Sale of Properties          $     (7)  $    47  $     8  $     (1)  $    (19)
     Gain on Sale of Properties                                      5       120     --          53       --
                                                              --------   -------  -------  --------   --------
 Net Income(Loss) per Limited Partnership Assignee Unit       $     (2)  $   167  $     8  $     52   $    (19)
                                                              ========   =======  =======  ========   ========

 Total Assets                                                 $ 21,845   $60,636  $67,436   $71 071   $ 74,936
                                                              ========   =======  =======  ========   ========

 Long Term Obligations:
     Notes Payable                                            $  8,292   $26,983  $42,518  $ 42,669   $ 48,800
                                                              ========   =======  =======  ========   ========

 Cash Distributions per Limited Partnership Assignee Unit     $    288   $    40  $    68  $     32   $     30
                                                              ========   =======  =======  ========   ========
<FN>

(1)    $1,000 original contribution per limited partnership assignee Unit, based
       on limited  partnership  assignee  units  outstanding  during the period,
       after allocation to the General Partners.
(2)    See discussion in Item 7 regarding future results of operations.
</FN>
</TABLE>

Item 7.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations.

Introduction

This Item should be read in  conjunction  with  Financial  Statements  contained
elsewhere in this Report.

Year 2000 Readiness Disclosure

With the change to the year 2000,  computer  programs or hardware  utilizing two
digits rather than four to define the applicable year may recognize a date using
"00" as the year 1900 rather than the year 2000.  This could  result in a system
failure or miscalculations causing disruptions of operations,  including,  among
other things, a temporary inability to conduct normal business activities.

In  anticipation  of the year 2000,  in late 1996 the Managing  General  Partner
conducted  a  thorough  inventory  of all  software  programs  it had in use and
identified  programs  that would require  modification  to correct date handling
methodology.  Furthermore,  the  Managing  General  Partner  initiated  a policy
requiring that all future software  purchases be year-2000  compliant.  With the
exception of the Managing General Partner's  financial  accounting  system,  the
majority of the  hardware  and  software in use was  determined  to be year-2000
compliant or it was  determined  that  compliance  could be achieved  with minor
modifications.  These  modifications  were 100% completed by year-end 1998. With
respect to the financial  accounting  system, the Managing General Partner is in
the process of implementing a Year  2000-compliant  software  product to replace
its existing system,  and anticipates the new system to be fully operational and
tested by July 31, 1999. All necessary changes have been and will continue to be
undertaken at no cost to the Partnership.


                                      -9-
<PAGE>
In addition to internal  systems,  the Managing  General Partner  surveyed third
parties that provide  essential  business  services to determine  their state of
year-2000 readiness.  The Partnership's  Servicing and Transfer Agent,  Gemisys,
utilizes a platform  programmed  to  correctly  interpret  the change to the new
century.  The state of  year-2000  readiness  of  Marriott,  the  manager of the
remaining  hotel,  is not  considered to be of  significance,  as the hotel will
likely be disposed of prior to year-end 1999.

The Managing  General Partner  anticipates  there to be no material  exposure to
year-2000 issues.  However,  should the Managing General Partner's new financial
accounting  system not be fully  operational  by December 31, 1999, the Managing
General Partner's  contingency plan would be to process  necessary  transactions
utilizing non-date sensitive software.

The  Partnership  sold eight of its nine remaining  hotels in December 1997, and
anticipates  disposing of its final  remaining  property,  the  Residence  Inn -
Nashville,  in  the  first  half  of  1999.  Accordingly,  historical  financial
information  will not be  representative  of future  results.  Future results of
operations  will be dependent on the operations of the Residence Inn - Nashville
and its  ultimate  disposal,  general and  administrative  expenses and interest
income, as well as the outcome of the legal proceedings relating to this hotel.

Results of Operations

1998 Compared to 1997

Net loss was $123,000 in 1998 compared to net income of $10,319,000 in 1997. The
change is primarily  due to the sale of eight  properties  on December 30, 1997,
when a gain on sale totaling  $7,505,000  was  recognized.  In 1998, the gain on
sale was  $300,000  relating  to the  portion  of the  1995  gain on sale of the
Residence Inn - Atlanta (Perimeter West) which had been deferred pending certain
contingencies  that have now been removed.  (See Item 8, Note 7 to the financial
statements).  In 1998,  the  Partnership  recognized  a $195,000  provision  for
impairment  on  its  remaining  property,  the  Residence  Inn -  Nashville,  as
described  in  Notes  4 and 5 to the  financial  statements.  Operations  at the
Residence  Inn -  Nashville  dropped  slightly  in 1998  compared  to 1997 while
interest income increased substantially.

Revenues and expenses from hotel operations as well as depreciation and interest
expense decreased substantially in 1998 when compared to 1997 due to the sale of
the eight hotels in 1997.  Revenues from the Partnership's  remaining hotel also
decreased as room rates were lowered in an attempt to maintain occupancy levels.
The  operating  expenses  decreased at this hotel in 1998 compared to 1997, as a
substantial  increase  in  administrative  expenses  was  more  than  offset  by
decreases in room operating costs, marketing,  repair and maintenance and ground
lease expense. The administrative expenses were unusually low in 1997 due to the
recognition  of a $95,000 credit related to the settlement of disputed sales and
use taxes which had been assessed by the State of Tennessee.

Interest  income  increased  by $311,000 in 1998  compared to 1997 due to higher
cash balances resulting from sales proceeds. General and administrative expenses
increased in 1998 compared to 1997 primarily as a result of an increase in legal
expenses which was only partially offset by decreases in Partnership  management
fees and administrative costs.

The operations of the Partnership's  single remaining property and the market in
which it is located are described below.

Residence  Inn - Nashville:  Operations  were  positive for 1998 but declined in
comparison to the prior year  resulting  primarily  from the $100,000  principal
reduction payment, as discussed below and in Note 5 to the financial statements.
While  occupancy  increased 1% to 83%, the average daily room rate  decreased by
$2.48 to $83.23, in comparison to the prior year. Market conditions deteriorated
significantly  during the latter part of the year due primarily to the reduction
in tourism to Nashville  resulting  from the closure of the Opryland Theme Park,
in combination with reduced  bookings for the Opryland  Convention  Center.  The
hotel continues to rely heavily on a marketing strategy  involving  coordination
among all local Marriott products.

1997 Compared to 1996

Net income was  $10,319,000  in 1997 compared to net income of $521,000 in 1996.
The net income in 1997 is comprised of $2,814,000  income before gain on sale of
properties and $7,505,000 gain on sale of properties.  There was no gain on sale
of  properties in 1996.  Income  before gain on sale of properties  increased by
$2,293,000 in 1997 compared to 1996  primarily as a result of  depreciation  not


                                      -10-
<PAGE>
being  recorded after June 30, 1997 on the real estate assets held for sale (see
Note  1  to  the  financial  statements).   In  addition,   operations  improved
substantially at the Residence Inn - Nashville and the Partnership's general and
administrative expenses decreased.

Revenues from hotel operations  increased 5% for 1997 compared to 1996 due to an
overall  increase in average room rates and improved  occupancy at the Residence
Inn - Nashville.  Hotel operating  expenses increased by 2% for 1997 compared to
1996. The increase was primarily in room  operating  expenses as a result of the
increase in room  revenues.  Management  fees also  increased as a result of the
increase  in  revenues.  The  increases  in these two  categories  as well as an
increase in repair and maintenance  expenses were partially  offset by decreases
in  administrative,  marketing and energy costs. The decrease in  administrative
expenses was  primarily  due to a favorable  settlement  regarding  the disputed
sales and use taxes assessed by the State of Tennessee  against the Partnership.
As of December 31, 1996,  the  Partnership  had accrued  $205,000 for  potential
payment to the State of Tennessee,  $165,000 of which had been expensed in 1996.
In 1997 the Partnership proposed, and the State accepted, payment of $122,000 in
settlement.  Thus,  in 1997 a credit of $83,000 was recorded and that,  combined
with  the  $165,000   expense  booked  in  1996,   resulted  in  a  decrease  in
administrative expenses of $248,000 in 1997 compared to 1996.

Interest  income  decreased by $20,000 for 1997  compared to 1996 as a result of
lower  average  cash  balances  in 1997.  General  and  administrative  expenses
decreased substantially in 1997 compared to 1996 primarily due to a write-off of
a $194,000  receivable  in 1996 and the  recognition  in 1996 of a $74,000  cost
associated with the additional loan obligation on the Residence Inn - Nashville.

Partnership Liquidity and Capital Resources

Introduction

As  presented  in the  Statements  of Cash  Flows,  cash was  used by  operating
activities.  Cash was  provided  by  investing  activities  from sales  proceeds
previously  held in escrow and proceeds  from sale of cash  investments  and was
used for capital  improvements and an increase in restricted cash. Cash was used
by financing  activities  for  distribution  to partners,  payment of prepayment
penalties and principal payments on notes payable.

The results of project operations before capital improvements for the year ended
December  31, 1998 are  determined  by net income or loss before gain on sale of
property  adjusted for non-cash items such as  depreciation,  amortization,  and
impairment  provision  for asset to be  disposed  of, and  reduced by  principal
payments  made on the  notes  payable  (see  Item 2.  Properties).  The  project
operations  before  capital  improvements  is an indication  of the  operational
performance of the property.  During 1998, the Partnership's  remaining property
generated   positive   project   operations   before   deductions   for  capital
improvements.  The  Partnership,  after taking into  account  results of project
operations  before  capital  improvements,  interest  income,  and  general  and
administrative  expenses, on an accrual basis, experienced negative results from
operations. Project operations should not be considered as an alternative to net
income or loss (as  presented in the financial  statements),  as an indicator of
the Partnership's operating performance,  or as an alternative to cash flow as a
measure of liquidity.  Project  operations  after capital  improvements  for any
given  year may not be  indicative  of the  property's  general  performance  as
capital improvements are likely to be made in large amounts when associated with
renovation programs.

The Partnership  considers cash investments to be those  investments  (primarily
commercial  paper) with an original  maturity  date of more than three months at
time of purchase. There were no cash investments at December 31, 1998.

The former management  company at the Residence  Inn-Ontario which is controlled
by Kenneth E.  Nelson  ("Nelson")  defaulted  on certain  obligations  under the
management  agreement.  As discussed in Note 8 to the financial  statements,  in
1991, the  Partnership  terminated the management  agreement and initiated legal
proceedings  against  the former  management  company.  The  management  company
withheld  $194,000 from property funds in unauthorized  management fees prior to
relinquishing  management  of  the  property.  The  $194,000  was  treated  as a
receivable  in the  Partnership's  financial  statements  until 1996 when it was
written off. See discussion in the Results of Operations  section. In March 1993
the  parties  verbally  agreed  to settle  the  lawsuit  (the "SF  Settlement");
however,  difficulties arose in consummating the settlement.  After a hearing in
May 1994,  the Court ruled in June that in the settlement  the  Partnership  had
agreed to purchase the land underlying the Residence  Inn-Nashville (the "Land")
from Nashville Lodging Company ("NLC"), an affiliate of Nelson, subject to a lis
pendens on the Land.


                                      -11-
<PAGE>
Following this ruling, the Partnership has attempted to negotiate and enter into
a settlement agreement and a land purchase agreement and related agreements (the
"Settlement  Documents")  among  itself and Nelson  and NLC and  another  Nelson
entity, 2300 Elm Hill Pike, Inc. ("2300").  To date, these parties have not been
able to reach agreement on all issues relating to the Settlement Documents.

As discussed in Item 8, Note 8 to the  financial  statements,  in May 1991 legal
proceedings  were  initiated  against  the  Partnership  and  others by  Orlando
Residence  Ltd.,  ("Orlando"),  holder of a promissory note issued by a previous
owner of the Residence  Inn-Nashville  (Airport) (the "Hotel").  Orlando claimed
the sale of the Hotel to the Partnership by NLC was intended to defraud,  hinder
and delay Orlando's recovery of the amount owed to it. The Partnership  obtained
a summary judgement dismissing the case against it on September 15, 1993.

In July 1994,  the Court in the case  filed by Orlando  ruled that the Hotel had
been  fraudulently  conveyed  to NLC by 2300 in 1986 and voided the  conveyance.
Judgements totaling more than $1,350,000 were subsequently entered by this Court
against Nelson,  NLC and 2300.  Based on this judgement,  Orlando  purchased the
Land at a judicial sale and became the landlord under the Lease.  This judgement
was reversed in December 1996 and NLC asked the Court to return ownership of the
Land to it. However, the Court has denied NLC's request.

In another  action in Nashville,  Tennessee,  2300 and NLC have alleged that the
Partnership  refused to purchase the Land as required by the SF  Settlement  and
demanded  indemnification  for all costs and losses of 2300 and NLC  relating to
Orlando's  claims.  In February  1996, the Court in this action granted a motion
filed by 2300 and NLC for partial summary judgement, ruling that the Partnership
had breached the SF  Settlement.  The action will continue to determine  damages
and other issues.  In February  1998, the Court  enjoined the  Partnership  from
conveying,  transferring, or otherwise disposing of its cash to any extent which
would leave less than $5 million  available for payment of any judgment  awarded
to 2300 and NLC. The Partnership does not believe it breached the SF Settlement.

See Item 8, Note 8 to the financial  statements for more  information  about the
foregoing and other related proceedings.

In December  1996 the  Partnership  reported  its  intention to proceed with the
marketing for sale of the  remaining  hotels in the  portfolio,  and the sale of
eight of the nine remaining hotels was completed on December 30, 1997.

In January  1998,  the  Partnership  made two  distributions  to its general and
limited partners,  one totaling  $16,818,000,  representing a portion of the net
sales proceeds,  and another one totaling  $612,000  representing a distribution
from 1997 operations.  In April 1998, the Partnership made another  distribution
to its partners  totaling  $229,000 in order to comply with certain  states' tax
withholding  requirements.   Since  these  distributions,  the  Partnership  has
maintained  approximately  $12  million  in  average  cash  balances  (including
$5,000,000  of  restricted  cash,  as  discussed  in  Note  8 to  the  financial
statements).   The  balance  may  change  depending  upon  the  outcome  of  the
Partnership's  negotiations  with the  lender  with  respect  to the note on the
Residence  Inn - Nashville  (see below).  With  respect to the use of cash,  the
Partnership  continues to be under certain  restrictions as discussed in Item 8,
Note 8 to the financial statements.

On  April  1,  1998,  the  balloon  mortgage  payment  for the  Residence  Inn -
Nashville, totaling approximately $8.5 million, became due and payable (see Note
5 to  the  financial  statements).  In  exchange  for  a  six-month  forbearance
agreement,  during which time the Partnership  pursued the potential sale of the
property,  the  lender  accepted a  principal  reduction  payment  of  $100,000,
reimbursement of $20,000 of its costs, and regular monthly debt service payments
through November 1, 1998. The Partnership subsequently determined that a sale of
the property was not feasible, and, as the forbearance agreement has expired, it
is likely that the property  will be disposed of in the first half of 1999.  The
Partnership is currently  negotiating with the lender to accept the deed in lieu
of foreclosure and to assume the Marriott management contract, thereby relieving
the Partnership of substantial  contract  termination  fees that it would likely
have to pay in the event of a foreclosure sale. In this regard,  the Partnership
has made regular monthly debt service  payments for the months of December 1998,
January,  February and March 1999,  and intends to make the April 1999  payment.
While  the  Partnership  believes  that the  ground  lease  associated  with the
property  would be terminated in the event of a  foreclosure,  or assumed by the
lender in the event of a deed in lieu transfer, the Partnership may be obligated
to pay deferred  rent under the lease.  Please refer to Part II, Item 7 and Item
8, Notes 5 and 6 to the financial statements.

In 1998,  the  Partnership  incurred  $262,000 for capital  improvements  at the
Residence Inn - Nashville.  The majority was spent on concrete  work,  decks and
necessary improvements to the foundation. In 1999, the capital plan, as proposed
by Marriott, calls for spending approximately $1,921,000, of which $1,260,000 is
budgeted for suite  renovations  commencing in the second quarter of 1999. These


                                      -12-
<PAGE>
improvements are generally  necessary to enable the remaining property to remain
competitive  in the market and are required under the franchise  agreement.  The
Partnership,  however,  has not  approved the 1999 capital plan and has put most
capital expenditures on hold pending the disposal of the hotel.

During  the  second  and third  quarters  of 1995 the  Partnership  worked  with
Marriott in an effort to  restructure  contracts on certain  Partnership  hotels
under their  management.  An agreement was reached whereby  Marriott reduced the
base  management  fee,  and  incorporated  incentive  fees which are tied to the
operations of the properties.  The restructured  agreements also provided for an
increase  in  certain  marketing  fees  charged by  Marriott.  The length of the
contract  terms was  reduced.  In addition,  the  Partnership  was  permitted to
terminate the contract  after a five year term in connection  with a sale of the
hotels.  A termination fee was payable if the purchaser were not to continue the
Residence Inn by Marriott franchise.  In exchange,  the Partnership executed new
agreements  with Marriott for the  management  of the Residence  Inns located in
Altamonte Springs,  Nashville, and Ontario.  Effective January 1, 1996, Marriott
managed all nine of the Partnership's then remaining hotels.  Marriott continues
to manage the Partnership's Residence Inn - Nashville.

In  accordance  with,  and as is  customary  in the  management  of hotels,  the
management  agreement  for the  remaining  hotel  provides for a  percentage  of
revenues to be placed in capital  replacement  funds.  The  capital  replacement
funds are used to fund on-going  capital  improvements  as well as room or other
major  renovation  programs.  The  capital  replacement  fund is being held in a
separate  account with  additions  generally  made monthly based on revenues and
expenditures  which are based on  approved  capital  expenditure  budgets by the
Partnership.  Unused funds are held in interest-bearing  accounts. To the extent
not available from the replacement fund, a capital improvement or renovation may
be funded from the Partnership's working capital reserve.

Over the past several  years a number of  unsolicited  offers to purchase  Units
were made to the  investors in the  Partnership,  of which the  Partnership  was
aware. As required by applicable  securities laws, the Partnership  notified its
investors of its views regarding these offers.  The Partnership took no position
with  respect to the offers but rather  advised the holders of assignee  limited
partnership  Units  to  consult  their  personal  financial  advisors,   as  the
desirability  of any  particular  offer to any Unit holder could differ  greatly
depending upon such Unit holder's financial, tax, and other individual status.

Unit holders were also advised that the Partnership and its Transfer Agent would
take such action as the  Partnership  deemed  appropriate  to ensure that resale
transactions  did not result in termination of the Partnership for tax purposes,
cause the Partnership to be classified as a publicly traded partnership or cause
the  Partnership to be taxed as a corporation.  Unit holders were reminded that,
in order to protect its status as a partnership for federal income tax purposes,
secondary  market  activity in its Units would be limited to less than 5% of the
outstanding  Units per calendar  year,  and that,  for any of these  reasons the
Partnership may refuse to recognize a resale transaction.

In 1996,  trading  of  assignee  limited  partnership  Units of the  Partnership
reached 4.9% as of April 9. Subsequent to that date and through the remainder of
the calendar year, the Partnership  did not recognize  resale  transactions  for
1996, and its Transfer Agent returned all paperwork  regarding such transactions
to the  originators.  This action was taken by the Managing  General  Partner in
accordance with its fiduciary  responsibility  and with the advice of Counsel to
protect the Partnership's tax status as a limited Partnership.

At the  beginning of 1997 the  suspension  of resale  transactions  was removed;
however,  on February 26, 1997,  the  Partnership's  Transfer Agent informed the
Managing  General  Partner  that  trading  had again  reached  4.9% (near the 5%
maximum percentage),  at which time the Managing General Partner again suspended
processing of resale transactions through the remainder of the calendar year.

At the  beginning of 1998 the  suspension  of resale  transactions  was removed,
although yet again on June 24, 1998 the  Partnership's  Transfer  Agent informed
the Managing  General  Partner that trading had again reached 4.9% at which time
the Managing General Partner again suspended  processing of resale transactions.
Unit holders were advised of that  suspension in accordance with Section 12.1 of
the Partnership  Agreement,  via a special communication dated June 24, 1998 and
all paperwork submitted from the time of the suspension through the remainder of
the calendar year was returned to the originator.

At the  beginning of 1999 the  suspension  of resale  transactions  was removed.
Through March 25, 1999, the  Partnership's  Transfer Agent processed  non-exempt
resale  transactions  representing  approximately  3.0% of the  total  number of
outstanding Units.  Should non-exempt resale  transactions  representing 4.9% of
the total number of outstanding  Units be reached,  the Managing General Partner


                                      -13-
<PAGE>
will again suspend  processing of these  transactions.  In this event  investors
will be notified promptly.

Conclusion

Since 1994 the Partnership  has provided  investors an estimated net asset value
per Unit based upon year-end  appraisals of the  Partnership's  real property in
combination with all other Partnership assets and liabilities as of year-end. In
view of (i) the sale of all of the Partnership's properties except the Residence
Inn - Nashville; (ii) the anticipated foreclosure or transfer pursuant to a deed
in lieu of foreclosure of the Residence Inn - Nashville; (iii) the Partnership's
potential liability of $1,400,000 in contract  termination fees plus other costs
upon  disposal of the hotel;  (iv)  distributions  the General  Partners will be
obligated  to  return  to the  Partnership  prior  to its  liquidation;  and (v)
uncertainties  related  to  the  litigation  relating  to  that  property,   the
Partnership will no longer provide an estimated net asset value per Unit.

However, the Partnership is aware that some resales of Units have taken place in
the informal secondary market. In this informal market,  transactions may or may
not take place in any given time period and occur at a price negotiated  between
the  buyer  and  seller.  The  Partnership  has no  knowledge  concerning  how a
particular  price may be  determined.  A total of 259 resale  transactions  were
recorded on the books of the  Partnership's  Transfer  Agent between  January 1,
1998 and June 24, 1998 (at which time the  Partnership  suspended  trading-  see
above),  reflecting  prices  ranging  from $112 to $417 per Unit,  with a simple
average price of $323. A total of 112 resale  transactions have been recorded on
the books of the Partnership's  transfer agent between January 1, 1999 and March
25, 1999,  reflecting  prices  ranging from $75 to $415 per Unit,  with a simple
average price of $104.  The  Partnership's  knowledge of these  transactions  is
based solely on the books and records of its Transfer Agent.

As discussed in Item 8, Note 9 to the financial statements, there is substantial
doubt regarding the  Partnership's  ability to continue as a going concern.  The
Partnership  does not  expect to  receive  any  significant  cash  flow  through
December 31, 1999.


                                      -14-
<PAGE>
Item 8.    Financial Statements and Financial Statement Schedules.

                  METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                        a California Limited Partnership

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                          <C>
Report of Independent Auditors............................................................................      16
Financial Statements:
   Balance Sheets at December 31, 1998 and 1997...........................................................      17
   Statements of Operations for the Years ended December 31, 1998, 1997 and 1996..........................      18
   Statements of Partners' Equity (Deficiency) for the Years ended December 31, 1998, 1997 and 1996.......      19
   Statements of Cash Flows for the Years ended December 31, 1998, 1997 and 1996..........................      20
   Notes to Financial Statements..........................................................................   21-28
Financial Statement Schedule:
   Schedule III - Real Estate and Accumulated Depreciation at December 31, 1998 and 1997..................   29-30
</TABLE>

      Financial  statements and financial  statement schedules not included have
been omitted because of the absence of conditions  under which they are required
or because the information is included elsewhere in the financial statements.



                                      -15-
<PAGE>
                         REPORT OF INDEPENDENT AUDITORS

Metric Partners Growth Suite Investors, L.P., a California Limited Partnership:

      We have audited the accompanying  balance sheets of Metric Partners Growth
Suite Investors, L.P., a California Limited Partnership,  (the "Partnership") as
of  December  31,  1998 and 1997,  and the  related  statements  of  operations,
partners'  equity  (deficiency) and cash flows for the three years in the period
ended  December  31,  1998.  Our audit also  included  the  financial  statement
schedule of the Partnership listed in the accompanying table of contents.  These
financial  statements and financial statement schedule are the responsibility of
the  Partnership's  management.  Our  responsibility is to express an opinion on
these financial statements and financial statement schedule based on our audits.

      We conducted our audits in accordance  with  generally  accepted  auditing
standards.  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
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 present fairly, in all material
respects,  the financial  position of the  Partnership  at December 31, 1998 and
1997,  and the results of its  operations and its cash flows for the three years
in the period ended  December 31, 1998, in conformity  with  generally  accepted
accounting  principles.  Also, in our opinion,  the financial statement schedule
for 1998 and 1997, when considered in relation to the basic financial statements
taken as a whole,  presents fairly in all material  respects the information set
forth therein.

      As discussed in Note 8 to the financial  statements,  the  Partnership  is
involved in  litigation in connection  with its one  remaining  hotel  property.
Additionally,  as discussed in Note 5 to the financial statements,  the property
was subject to a mortgage note payable that became due on April 1, 1998,  and is
in default.  These conditions raise  substantial  doubt about the  Partnership's
ability to  continue as a going  concern.  The  Partnership's  plans as to these
matters  are  also  described  in  Notes  4 and 5.  The  accompanying  financial
statements  do  not  include  any  adjustments   that  might  result  from  this
uncertainty.


                                                               Ernst & Young LLP

San Francisco, California
March 15, 1999


                                      -16-
<PAGE>
<TABLE>

                                   METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                                       a California Limited Partnership

                                                  BALANCE SHEETS
                                                   December 31,


<CAPTION>
                                        ASSETS                  1998           1997
                                                                ----           ----
<S>                                                          <C>          <C>            
CASH AND CASH EQUIVALENTS .................................  $ 7,485,000  $ 27,051,000
CASH INVESTMENTS ..........................................         --       3,888,000
CASH IN ESCROW ............................................         --      19,214,000
RESTRICTED CASH ...........................................    5,353,000       335,000
ACCOUNTS RECEIVABLE .......................................      672,000     1,295,000
PREPAID EXPENSES AND OTHER ASSETS .........................      126,000       178,000

PROPERTIES AND IMPROVEMENTS ...............................         --      13,909,000
ACCUMULATED DEPRECIATION ..................................         --      (5,263,000)
                                                             -----------  ------------

NET PROPERTIES AND IMPROVEMENTS ...........................         --       8,646,000
ASSET TO BE DISPOSED OF ...................................    8,185,000          --
DEFERRED FRANCHISE FEES ...................................       24,000        29,000
                                                             -----------  ------------

TOTAL ASSETS ..............................................  $21,845,000  $ 60,636,000
                                                             ===========  ============

                           LIABILITIES AND PARTNERS' EQUITY

ACCOUNTS PAYABLE ..........................................  $   655,000  $  1,542,000
ACCRUED PROPERTY TAXES ....................................      114,000       116,000
ACCRUED PREPAYMENT PENALTIES ..............................         --         438,000
ACCRUED INTEREST ..........................................      333,000       307,000
OTHER LIABILITIES .........................................      751,000     1,487,000
DEFERRED GAIN ON SALE OF PROPERTY .........................         --         300,000
NOTES PAYABLE .............................................    8,292,000    26,983,000
                                                             -----------  ------------

TOTAL LIABILITIES .........................................   10,145,000    31,173,000
                                                             -----------  ------------

COMMITMENTS AND CONTINGENCIES

PARTNERS' EQUITY:
    GENERAL PARTNERS ......................................         --         348,000
    LIMITED PARTNERS (59,932 units outstanding) ...........   11,700,000    29,115,000
                                                             -----------  ------------

TOTAL PARTNERS' EQUITY ....................................   11,700,000    29,463,000
                                                             -----------  ------------

TOTAL LIABILITIES AND PARTNERS' EQUITY ....................  $21,845,000  $ 60,636,000
                                                             ===========  ============
</TABLE>


                       See notes to financial statements
                                      -17-
<PAGE>
<TABLE>
                               METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                                      a California Limited Partnership

                                          STATEMENTS OF OPERATIONS
                            For the Years Ended December 31, 1998, 1997 and 1996
<CAPTION>


                                                                          1998          1997         1996
                                                                          ----          ----         ----
<S>                                                                   <C>           <C>          <C>        
REVENUES
Hotel operations ...................................................  $ 4,445,000   $25,778,000  $ 24,610,000
Interest and other .................................................      726,000       415,000       435,000
                                                                      -----------   -----------  ------------

Total revenues .....................................................    5,171,000    26,193,000    25,045,000
                                                                      -----------   -----------  ------------

EXPENSES (Including $282,000, $513,000 and $461,000 paid to managing
general partner and affiliates in 1998, 1997 and 1996, respectively)
Hotel operations
     Rooms .........................................................      936,000     5,223,000     4,899,000
     Administrative ................................................      611,000     3,008,000     3,101,000
     Marketing .....................................................      464,000     2,677,000     2,762,000
     Energy ........................................................      230,000     1,262,000     1,281,000
     Repair and maintenance ........................................      221,000     1,453,000     1,411,000
     Management fees ...............................................      152,000     1,005,000       916,000
     Property taxes ................................................      112,000       731,000       738,000
     Other .........................................................      258,000       975,000       917,000
                                                                      -----------   -----------  ------------
Total hotel operations .............................................    2,984,000    16,334,000    16,025,000
Depreciation and other amortization ................................      533,000     1,759,000     2,933,000
Interest ...........................................................      859,000     4,327,000     4,350,000
General and administrative .........................................    1,023,000       959,000     1,216,000
Impairment provision for asset to be disposed of ...................      195,000          --            --
                                                                      -----------   -----------  ------------

Total expenses .....................................................    5,594,000    23,379,000    24,524,000
                                                                      -----------   -----------  ------------

INCOME (LOSS) BEFORE GAIN ON SALE OF PROPERTIES ....................     (423,000)    2,814,000       521,000
Gain on sale of properties .........................................      300,000     7,505,000          --
                                                                      -----------   -----------  ------------

NET INCOME (LOSS) ..................................................  $  (123,000)  $10,319,000  $    521,000
                                                                      ===========   ===========  ============

NET INCOME PER LIMITED PARTNERSHIP ASSIGNEE UNIT:
Income (loss) before gain on sale of properties ....................  $        (7)  $        47  $          8
                                                                                                             
Gain on sale of properties .........................................            5           120          --
                                                                      -----------   -----------  ------------
NET INCOME (LOSS) ..................................................  $        (2)  $       167  $          8
                                                                      ===========   ===========  ============

CASH DISTRIBUTIONS PER LIMITED PARTNERSHIP ASIGNEE UNIT ............  $       288   $        40  $         68
                                                                      ===========   ===========  ============
</TABLE>
                       See notes to financial statements
                                      -18-
<PAGE>

<TABLE>

                               METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                                      a California Limited Partnership

                                STATEMENTS OF PARTNERS' EQUITY (DEFICIENCY)
                           For the Years Ended December 31, 1998, 1997 and 1996

<CAPTION>

                                                  General       Limited
                                                  Partners      Partners        Total
                                                  --------      --------        -----
<S>                                              <C>         <C>            <C>        
BALANCE, January 1, 1996 ......................  $ 100,000   $ 25,150,000   $ 25,250,000
Net Income ....................................     43,000        478,000        521,000
Cash Distributions ............................    (84,000)    (4,097,000)    (4,181,000)
                                                 ---------   ------------   ------------
BALANCE, DECEMBER 31, 1996 ....................     59,000     21,531,000     21,590,000
Income Before Gain on Sale of Properties ......      2,000      2,812,000      2,814,000
Gain on Sale of Properties ....................    336,000      7,169,000      7,505,000
Cash Distributions ............................    (49,000)    (2,397,000)    (2,446,000)
                                                 ---------   ------------   ------------
BALANCE, DECEMBER 31, 1997 ....................    348,000     29,115,000     29,463,000
Income (Loss) Before Gain on Sale of Properties      5,000       (428,000)      (423,000)
Gain on Sale of Properties ....................       --          300,000        300,000
Cash Distributions ............................   (353,000)   (17,287,000)   (17,640,000)
                                                 ---------   ------------   ------------
BALANCE, DECEMBER 31, 1998 ....................  $    --     $ 11,700,000   $ 11,700,000
                                                 =========   ============   ============
</TABLE>


                       See notes to financial statements.
                                      -19-
<PAGE>
<TABLE>
                                METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                                      a California Limited Partnership

                                          STATEMENTS OF CASH FLOWS
                            For the Years Ended December 31, 1998, 1997 and 1996


<CAPTION>
                                                                          1998            1997           1996
                                                                          ----            ----           ----
<S>                                                                    <C>            <C>            <C>
OPERATING ACTIVITIES:
Net income (loss) ...................................................  $   (123,000)  $ 10,319,000   $    521,000
Adjustments to reconcile net income (loss) to net cash provided
(used) by operating activities:
     Depreciation and other amortization ............................       533,000      1,962,000      3,122,000
     Cost associated with note payable change (see Note 5) ..........          --             --           74,000
     Impairment provision for asset to be disposed of ...............       195,000           --             --
     Gain on sale of properties .....................................      (300,000)    (7,505,000)          --
     Changes in operating assets and liabilities:
         Accounts receivable ........................................       623,000       (580,000)       319,000
         Prepaid expenses and other assets ..........................        52,000         (1,000)       (13,000)
         Accounts payable, accrued expenses and other liabilities ...    (1,381,000)       206,000        176,000
                                                                       ------------   ------------   ------------
Net cash provided (used) by operating activities ....................      (401,000)     4,401,000      4,199,000
                                                                       ------------   ------------   ------------

INVESTING ACTIVITIES:
Proceeds from sale of properties ....................................          --       58,644,000           --
Capital improvements ................................................      (480,000)    (2,032,000)    (2,571,000)
Cash in escrow ......................................................    19,214,000    (19,214,000)          --
Restricted cash - increase ..........................................    (5,018,000)       (27,000)        (6,000)
Purchase of cash investments ........................................          --       (3,888,000)    (5,862,000)
Proceeds from sale of cash investments ..............................     3,888,000      3,893,000      1,969,000
                                                                       ------------   ------------   ------------
Net cash provided (used) by investing activities ....................    17,604,000     37,376,000     (6,470,000)
                                                                       ------------   ------------   ------------

FINANCING ACTIVITIES:
Notes payable principal payments ....................................   (18,691,000)   (15,716,000)      (360,000)
Prepayment penalties paid ...........................................      (438,000)          --             --
Cash distributions to partners ......................................   (17,640,000)    (2,446,000)    (4,181,000)
                                                                       ------------   ------------   ------------
Cash used by financing activities ...................................   (36,769,000)   (18,162,000)    (4,541,000)
                                                                       ------------   ------------   ------------

INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS .........................................................   (19,566,000)    23,615,000     (6,812,000)
Cash and cash equivalents at beginning of year ......................    27,051,000      3,436,000     10,248,000
                                                                       ------------   ------------   ------------

CASH AND CASH EQUIVALENTS AT END OF YEAR ............................  $  7,485,000   $ 27,051,000   $  3,436,000
                                                                       ============   ============   ============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Interest paid in cash during the year ...............................  $    833,000   $  4,080,000   $  4,242,000
                                                                       ============   ============   ============

SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES


Note payable increase (see Note 5) ..................................          --             --     $     74,000
                                                                       ============   ============   ============

Capital improvements - accrued ......................................          --     $    218,000           --
                                                                       ============   ============   ============

Accrued prepayment penalties ........................................          --     $    438,000           --
                                                                       ============   ============   ============
</TABLE>


                       See notes to financial statements.
                                      -20-
<PAGE>
                  METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                        a California Limited Partnership

                          NOTES TO FINANCIAL STATEMENTS


1.    Organization and Summary of Significant Accounting Policies

Organization  - Metric  Partners  Growth  Suite  Investors,  L.P.,  a California
Limited  Partnership  (the  "Partnership"),  was organized under the laws of the
State of California to acquire,  hold for  investment,  manage,  and  ultimately
sell, all-suite, extended stay hotels which are a franchise of the Residence Inn
by Marriott,  Inc. The managing  general  partner is Metric Realty,  an Illinois
general  partnership.  The Associate  General  Partner of the Partnership is GHI
Associates II, L.P., a California Limited Partnership, of which Metric Realty is
the general  partner  and  Prudential-Bache  Properties,  Inc.,  a  wholly-owned
subsidiary of Prudential Securities Group Inc., is the limited partner.  Through
March 31,  1997,  Metric  Realty was owned by Metric  Holdings,  Inc. and Metric
Realty Corp.  Metric Realty Corp. was the Managing Partner of Metric Realty.  On
April 1, 1997,  Metric  Holdings,  Inc. and Metric Realty Corp., the partners of
the Managing General Partner,  Metric Realty, were involved in certain corporate
transactions.  Pursuant to these  transactions,  (i) Metric  Holdings,  Inc. was
merged into a newly-formed  corporation known as SSR Realty Advisors, Inc. ("SSR
Realty"),  which became the managing  partner of Metric Realty,  and (ii) Metric
Realty Corp. was merged into Metric Property  Management,  Inc., a subsidiary of
SSR Realty.  Accordingly,  the partners of Metric  Realty are now SSR Realty and
Metric Property Management, Inc. After consummation of these transactions,  both
partners of Metric Realty continue to be wholly-owned individual subsidiaries of
Metropolitan  Life  Insurance  Company,  as  were  both  partners  prior  to the
occurrence of such transactions. The Partnership was organized on June 28, 1984,
and commenced operations on April 14, 1988. Capital contributions of $59,932,000
($1,000 per assignee Unit) were made by the limited partners.

Fair Value of  Financial  Instruments  - The  carrying  amounts of cash and cash
equivalents,  cash investments and restricted cash approximate their fair value.
It is not practicable to estimate the fair value of the note payable because the
note is in default  and the  related  property  securing  the note is subject to
litigation; therefore, there is no readily determinable market for the note.

Use of Estimates - The  preparation  of the  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  - The  Partnership  considers  all  highly  liquid
investments, primarily commercial paper, with an original maturity date of three
months or less at the time of purchase to be cash equivalents.

Cash Investments - Cash investments  include all cash investments not considered
cash or cash  equivalents.  The cash  investment at December 31, 1997 matured in
March 1998 and carried  interest at an effective  rate of 5.6% per annum.  There
were no cash investments at December 31, 1998.

Restricted Cash - The restricted  cash at December 31, 1998 includes  $5,000,000
that (as discussed in Note 8) the Court enjoined the Partnership from conveying,
transferring,  or otherwise  disposing  of. The balance at December 31, 1998 and
the amount at December 31, 1997,  consists of amounts related to the sale of the
Residence Inn - Atlanta  (Perimeter  West) which were  deposited  into an escrow
account. See Note 7.

Cash in Escrow - Cash in escrow at December 31, 1997  consisted  of  $19,070,000
due to the lender of the notes payable on six of the hotels sold on December 30,
1997, and $144,000 in funds held in escrow  pending final closing  settlement by
the escrow agent. The $19,070,000 was paid to the lender on January 2, 1998. The
amount represented  $18,469,000 principal due, $438,000 prepayment penalties and
$163,000  accrued  interest.  The $144,000 excess funds held by the escrow agent
were returned to the Partnership on January 5, 1998. See Note 7.

Credit Risk - Financial instruments which potentially subject the Partnership to
concentrations  of credit risk include cash and cash  equivalents and restricted
cash. The  Partnership  places its cash deposits and temporary cash  investments
with creditworthy,  high-quality  financial  institutions.  The concentration of
such cash  deposits and  temporary  cash  investments  is not deemed to create a
significant risk to the Partnership.


                                      -21-
<PAGE>
Properties and Improvements - At December 31, 1997, the Partnership's  remaining
property was stated at cost. At December 31, 1998,  the property was  classified
as asset to be disposed of and a provision for impairment was recorded in 1998.

Asset to be  disposed of - Asset to be disposed of is stated at the lower of its
carrying value amount or estimated fair value.  Depreciation  is not recorded on
an asset to be disposed of,  therefore,  no further  depreciation  will be taken
after December 31, 1998.

Gain on Sale of Properties - Sales are generally recorded at the close of escrow
or after title has been transferred to buyer and after appropriate payments have
been received and other criteria have been met.

Depreciation - Depreciation  was computed  using the  straight-line  method over
estimated  useful lives of 30 years for buildings and improvements and six years
for furnishings.

Marketing - Marketing costs are expensed as incurred.

Deferred  Financing  Costs -  Financing  costs are  deferred  and  amortized  as
interest expense over the lives of the related loans.

Deferred   Franchise  Fees  -  Franchise  fees,  paid  in  connection  with  the
acquisition of the Residence Inns, are deferred and amortized over the remaining
lives of the franchise agreements.

Net Income (Loss) Per Limited Partnership Assignee Unit - Net income per limited
partnership  assignee  Unit is computed by dividing net income  allocated to the
limited partners by 59,932 assignee Units.

Income Taxes - No provision  for Federal and state income taxes has been made in
the  financial  statements  because  income  taxes  are  the  obligation  of the
partners.

Comprehensive Income - The Partnership adopted Statement of Financial Accounting
Standards No. 130, "Reporting  Comprehensive Income" ("FAS 130") at December 31,
1998. Under FAS 130, the Partnership is required to display comprehensive income
(loss)  and  its  components  as  part  of  the  financial   statements.   Other
comprehensive income (loss) includes certain changes in equity that are excluded
from net income (loss). Specifically,  FAS 130 requires unrealized holding gains
and losses on available-for-sale  securities to be included in accumulated other
comprehensive income (loss). The Partnership has no material components of other
comprehensive income (loss) and, accordingly, the comprehensive income (loss) is
the same as net income (loss) for all periods presented.

Segment  Information - The  Financial  Accounting  Standards  Board (the "FASB")
issued Statement of Financial Accounting  Standards No. 131,  "Disclosures about
Segments  of an  Enterprise  and  Related  Information"  ("FAS  131"),  which is
effective for financial  statements  for periods  beginning  after  December 15,
1997. FAS 131 establishes standards for the way that public business enterprises
report financial and descriptive information about reportable operating segments
in annual  financial  statements  and in interim  reporting  to  investors.  The
Partnership  adopted FAS 131 in 1998. The Partnership has determined that it has
one operating and reportable segment,  the operations of its one remaining hotel
property in Nashville, which is further described in Note 4.

2.    Transactions With the General Partners and Affiliates

In accordance with the Partnership agreement,  the Partnership is charged by the
managing   general   partner  and  affiliates  for  services   provided  to  the
Partnership. The amounts are as follows:

                                  1998         1997         1996
                                  ----         ----         ----
Partnership management fees.... $ 72,000     $213,000     $186,000
Reimbursement of expenses......  210,000      300,000      275,000
                                --------     --------     --------
Total                           $282,000     $513,000     $461,000
                                ========     ========     ========


Reimbursement of expenses include partnership accounting,  professional services
and investor services.

In accordance with the Partnership  agreement the general partners are allocated
their two percent  continuing  interest in the  Partnership's net income or loss
and cash distributions. In addition, in 1994 the general partners were allocated


                                      -22-
<PAGE>
gross  income of  $245,000 in  accordance  with and  calculated  pursuant to the
Partnership Agreement.  However, beginning in 1995, due to the general partners'
equity  account  balance,  the  Partnership  adjusted  and  limited  the  income
allocation  to the  general  partners  to  amounts  equal to their  two  percent
continuing  interest  in  cash   distributions.   Pursuant  to  the  Partnership
Agreement,  immediately prior to liquidation and if certain  distribution levels
to the limited  partners are not met,  the general  partners may be obligated to
return all or a portion of the cumulative amounts received in distributions.  At
December 31, 1998,  such amount is  approximately  $810,000 and the  Partnership
believes  circumstances  will be such that the general partners will be required
to re-contribute this amount.

The general partners were allocated taxable gain and loss in accordance with the
Partnership Agreement.

3.    Properties and Improvements

Hotel  properties  and  improvements  at  December  31, 1997 are  summarized  as
follows:
                                                  1997
                                                  ----
Land ..........................               $       --
Buildings and improvements ....                 11,110,000
Furnishings ...................                  2,799,000
                                              ------------

Total .........................                 13,909,000
Accumulated depreciation ......                 (5,263,000)
                                              ------------

Net properties and improvements               $  8,646,000
                                              ============


4.    Asset To Be Disposed Of

At December 31, 1998, the Partnership's  remaining property, the Residence Inn -
Nashville,  was  classified  as  asset  to be  disposed  of  and  an  impairment
provision,  in the amount of $195,000, was recorded to reduce the carrying value
to the estimated  fair value less costs to dispose of. The estimated  fair value
for this  property  is  equivalent  to the  estimated  principal  balance on the
mortgage  note payable at the expected  date for the transfer of the property to
the lender via deed in lieu of foreclosure  or through  foreclosure as discussed
in Note 5 below.  The estimated fair value of the property does not  necessarily
represent  the amount at which the property  will  ultimately  be disposed.  The
actual  disposition  price  may  differ  from  management's  estimate;  however,
management  believes  that  the  estimated  fair  value  of  the  property  is a
reasonable approximation of the market price.

In deciding to sell or dispose of the property,  the Partnership  considered the
deterioration  of the Nashville  market,  in  conjunction  with the  substantial
capital improvements that would be required under the Marriott contract over the
next  several  years  and  which  would be  necessary  for the  hotel to  remain
competitive.

5.    Notes Payable

The  $26,983,000  notes  payable  balance  at  December  31,  1997,   represents
$8,514,000  outstanding balance on the note payable related to the Residence Inn
- Nashville,  the Partnership's  remaining property, and $18,469,000 outstanding
combined balance on the notes relating to six of the properties sold on December
30, 1997, which was paid on January 2, 1998. See Note 7.

The note payable on the Residence  Inn - Nashville  became due on April 1, 1998,
and a balloon  payment of $8,491,000 was due. The  Partnership  did not make the
payment and has since been in default.  The  Partnership was unable to negotiate
an extension  of the loan with the lender.  However,  the lender  entered into a
six-month forbearance agreement with the Partnership,  while the Partnership was
in  negotiations  for a potential  sale,  in exchange for a principal  reduction
payment of  $100,000  and  reimbursement  of  $20,000 to the lender for  certain
costs.  In  addition,  the  Partnership  made the regular  monthly  debt service
payments  through  November  1,  1998,  including  payments  to the tax  impound
account. At that time, however,  negotiations with a potential buyer, for a sale
at a contract price equal to approximately the outstanding note payable balance,
had  terminated  and the buyer had  withdrawn its offer as the title company was
unable to issue acceptable title insurance to the buyer with respect to the land
on which the hotel is built.  The  forbearance  agreement  had  expired  and the
Partnership  concluded  that  permitting the lender to foreclose was in the best
interest of the investors.

The Partnership  discontinued the monthly debt service  payments  effective with
the payment due December 1, 1998.  In January  1999,  the lender  contacted  the
Partnership and it was agreed that the  Partnership  would make the monthly debt
                                  -23-
<PAGE>
service  payments to cover the payments  due  December 1, 1998 through  April 1,
1999,  in exchange for the lender  agreeing to work towards  taking title to the
property via a deed in lieu of foreclosure and assuming the management  contract
with Marriott (with Marriott's consent),  thereby relieving the Partnership of a
potential  obligation to pay  approximately  $1,400,000 in termination fees plus
other  costs,  and relief from the ground  lease.  Consequently,  on February 5,
1999, the  Partnership  paid $265,000 to cover the monthly  payments  (including
impound) due through February 1, 1999. The Partnership has also paid the $88,000
due March 1, 1999 and is planning to make the payment due April 1, 1999, also in
the amount of $88,000.  There can, however, be no assurance that the transfer of
the property will be ultimately consumated as here described.

The Residence Inn - Nashville (Airport) note payable with an original balance of
$9,250,000   originally  wrapped  an  existing  loan  which  had  a  balance  of
approximately  $9,336,000  at the time the  Partnership  acquired the  property.
However,  on April 15, 1996,  the  Partnership  made a payment of  approximately
$176,000  to the  lender  of the  underlying  mortgage  of the wrap  note on the
Residence  Inn - Nashville  (Airport).  The payment was made to cure defaults by
that  lender  to the  holder of the wrap  note for  non-payment  of the debt and
impound  payments due on January 1, 1996 and  February 1, 1996.  As described in
Note 8, Legal  Proceedings,  the  Partnership  is now the direct  obligor to the
first note holder and the note  payable  balance has been  increased by $74,000,
the difference between the balance of the first note and the balance of the wrap
note on April 15, 1996. The $74,000 cost incurred to prevent  foreclosure and to
eliminate  the wrap note was  recorded in 1996 as a general  and  administrative
expense in these financial statements. The terms of the first note vary slightly
from those of the wrap note.  The  interest  rate is 9.5% per annum on the first
note  compared to 9.9433% on the wrap note and monthly  payments of interest and
principal are approximately  $2,600 lower on the first note. Similar to the wrap
note, the first note matured in April 1998 and required a balloon payment.  As a
further  consequence of the  Partnership  becoming a direct obligor to the first
note holder,  the payments due under the land lease on Residence Inn - Nashville
(Airport) were reduced by $50,000 per year. See Note 6.

Certain of the notes were  discounted over their term to yield interest at 10.15
to 10.5 percent per annum.  Discount  amortization was $149,000 and $135,000 for
the years ended December 31, 1997 and 1996, respectively.  There was no discount
amortization in 1998.  Amortization of deferred  financing costs totaled $54,000
for each of the years ended December 31, 1997, and 1996.

6.    Minimum Future Rental Commitments

The Residence Inn - Nashville  (Airport) is subject to a land lease that extends
through May 25, 2049,  with an option to purchase the land. The annual  payments
on the lease were $100,000 plus additional payments equal to 1.8% of the hotel's
revenues.  The 1.8% additional  payments  requirement expired on April 15, 1998.
Additional  payments of $50,000 were required and paid until the purchase  money
note to the  seller  of the  property  was paid off in full in April  1996.  The
$100,000  annual  payment  is due  based  upon the  property  achieving  certain
operating results and any amounts not paid currently are accrued. The balance of
accrued rent is subject to interest charges at ten percent per annum, compounded
annually.  At December  31,  1998 and 1997,  the  balances of accrued  rent plus
interest  were  $598,000 and  $512,000,  respectively.  Accrued rent and accrued
interest are included in other liabilities and accrued  interest,  respectively,
in the accompanying financial statements.

Beginning in the eleventh lease year, the annual lease payment is adjusted every
five years with the payment based on  application  of the then current  ten-year
United States Treasury Bond rate of interest,  to a valuation of the land at the
higher of its then fair market value or the option price in the lease.

While  the  Partnership  believes  that the  ground  lease  associated  with the
property  would be  terminated  in the event of  foreclosure,  or assumed by the
lender in the event of a deed in lieu transfer, the Partnership may be obligated
to pay deferred rent under the lease.

Rental  expense  (including  the 1.8% of revenues)  for this lease was $114,000,
$178,000 and $186,000 in 1998, 1997 and 1996, respectively.

7.    Sale of Properties

The Partnership sold the Residence Inns - Ontario,  Columbus (East), Fort Wayne,
Indianapolis,  Lexington,  Louisville,  Winston Salem and  Altamonte  Springs on
December 30,  1997.  The  combined  sales price,  for the package of these eight
residence inns, was  $59,500,000.  After payment of the outstanding  balances on
the  loans  totaling  $33,819,000  and  expenses  of sale  totaling  $1,294,000,
including  $438,000 of  prepayment  penalties  on certain of the loans,  the net
proceeds to the Partnership were $24,387,000.  Pursuant to an agreement with the
lender on six of the eight  residence  inns,  the  outstanding  balances  on the
related six notes totaling $18,469,000, and the required prepayment penalties of
$438,000,  were not paid until January 2, 1998. To secure  payment to the lender
                                      -24-
<PAGE>
of the six notes mentioned,  a portion of the net sales proceeds was retained in
an escrow  account on December 30, 1997,  sufficient to pay off the  outstanding
principal balances, prepayment penalties due pursuant to the loan agreements and
interest  accrued to date of payoff,  and is  reflected in Cash in Escrow on the
December 31, 1997 balance sheet.

The  Partnership  was  required by the  purchaser,  under the terms of the sales
contract, not to distribute $7,500,000 of the sales proceeds for a period of one
year  from the date of sale,  which  amount  represented  the  maximum  possible
liability of the Partnership for any breach of the sales  agreement.  There were
no known  contingencies  with respect to potential  claims that could be brought
against the Partnership nor were any presented during the aforementioned period,
which expired on December 30, 1998.

The  December  31,  1998  accounts  receivable  balance  includes  approximately
$572,000  due from the buyer of the eight  hotels.  The amount  relates to final
prorations  and  is  expected  to  be  collected  in  full.  Upon  receipt,  the
Partnership will pay amounts due Marriott,  also relating to final prorations of
the eight hotels and which amounts are included in the  liabilities  at December
31, 1998.

The Partnership  sold the Residence  Inn-Atlanta  (Perimeter West) on October 3,
1995.  The net sales price was  $11,350,000  after  deducting  $300,000 that was
deposited  into an  escrow  account  (the  "Shortfall  Guaranty  Account").  The
Partnership  guaranteed  certain  income  levels to the buyer for the years from
1996 through  1998.  To the extent these income  levels were not  attained,  the
buyer  would  receive  the  deficiency,  up to the  maximum  $300,000,  from the
Shortfall  Guaranty  Account.  For each of the  three  years,  the buyer has not
provided requests for draws on the Shortfall Guaranty Account, and, based on the
lapse of the  period  in which  the  buyer  had to  provide  such  request,  the
Partnership has concluded that the contingency has been removed and the deferred
gain  on sale  of  $300,000  was  recognized  in  1998.  Pursuant  to an  escrow
agreement,  the $300,000 (plus interest  earned thereon) will be returned to the
Partnership on March 31, 1999.

8.    Legal Proceedings

Metric Partners Growth Suite Investors,  L.P. vs. Kenneth E. Nelson,  The Nelson
Group, et al., San Francisco  County  Superior  Court,  Case No. 928065 (the "SF
Lawsuit").  [The  lawsuits  described  below are related.  Terms  defined in the
description of one case may be used in the description of the other cases.]

This  lawsuit   relates  to  disputes  in  connection  with  management  of  the
Partnership's  Residence  Inn - Ontario  by an entity  controlled  by Kenneth E.
Nelson  ("Nelson")  from  April  1988 to  February  1991.  In  March  1993,  the
Partnership  and Nelson verbally agreed to settle the SF Lawsuit at a settlement
conference (the "SF  Settlement"),  whereby the Partnership  would purchase at a
discount the land (the "Land")  underlying  the  Partnership's  Residence  Inn -
Nashville (the "Hotel") then leased by the  Partnership  from Nashville  Lodging
Company ("NLC"), an entity controlled by Nelson.  Various  disagreements between
the  Partnership and Nelson  regarding the SF Settlement  arose after March 1993
and documents to effectuate the SF Settlement were never executed.

In July 1994, the Court in the Nashville Case I, discussed below, ruled that the
Hotel had been  fraudulently  conveyed to NLC in 1996 and voided the conveyance.
The Court in the  Nashville  Case I ordered a sale of the Land,  subject  to all
prior  encumbrances,  including the ground lease of the Land by the  Partnership
(the  "Lease").  As  discussed in more detail  below (see  "Nashville  Case I"),
subsequent  to a  judicial  sale held on July 24,  1996,  the  Court  ruled in a
confirmation  hearing held in August 1996 that the Land would be sold to Orlando
Residence,  Ltd.  ("Orlando").  In December 1996, the Tennessee Court of Appeals
reversed the judgment underlying the judicial sale; however, the Court has ruled
against NLC on its motion that the Land be reinstated to NLC.

Orlando Residence Ltd. vs. Metric Partners Growth Suite Investors,  L.P. et al.,
Chancery  Court  for  Davidson  County,  in  Nashville,   Tennessee,   Case  No.
92-3086-III ("Nashville Case I")

2300 Elm Hill  Pike,  Inc.  ("2300")  (formerly  known  as  Nashville  Residence
Corporation  until  1986) was the  original  owner of the Hotel  (including  the
Land).  2300 conveyed its interest in the Hotel  (including  the Land) to NLC in
1986 by unrecorded  quitclaim deed. In April 1989, NLC sold the Hotel and leased
the Land to the Partnership pursuant to the Lease.

In October 1992, Orlando filed this lawsuit against NLC and its general partners
and the Partnership, alleging that the sale of the Hotel and the Land by 2300 to
NLC in 1986 and NLC's  subsequent sale of the Hotel and lease of the Land to the
Partnership in 1989 were fraudulent conveyances,  intended to hinder Plaintiff's
recovery of a judgment  against 2300. In August 1993,  the Court  dismissed this
action  against the  Partnership.  The  Partnership's  only material  continuing
interest in the case is its effect on ownership of the Land and the Lease.


                                      -25-
<PAGE>
In August  1994,  the Court held that the sale of the Hotel by 2300 to NLC was a
fraudulent  conveyance and voided the  conveyance.  The defendants  appealed the
judgment  for Orlando in this case to the  Tennessee  Court of Appeals,  but the
judgment was not stayed pending appeal. Oral argument on this appeal was held on
November  1, 1996,  and in  December  1996,  the Court of Appeals  reversed  the
judgment  for  Orlando,  sending  the case back to the lower  court for  further
proceedings.

Prior to this reversal,  Orlando requested and the Court ordered a judicial sale
of the Land,  with the sale subject to  encumbrances  of record,  including  the
Lease.  The sale was a credit sale,  with the purchase  price due in six months.
This sale was held on July 24, 1996. At a  confirmation  hearing in August 1996,
the Court ordered the Land to be sold to Orlando. The Court further ordered that
Orlando was to become the landlord under the Lease. Because of this reversal and
the refusal of the Tennessee  Supreme Court to hear an appeal from Orlando,  NLC
asked the  Chancery  Court to return  ownership  of the Land to it,  which would
result in it again  becoming  the  landlord  under the  Lease.  The Court  heard
argument  regarding NLC's request on September 11, 1997, and later ruled against
NLC. Thus,  Orlando  continues to be the owner of the Land and the Partnership's
landlord  under the Lease.  NLC may appeal  this  ruling for  Orlando;  however,
Orlando has  asserted  that the period  during which this ruling may be appealed
has expired.

Nashville  Lodging Company vs. Metric Partners Growth Suite  Investors,  L.P. et
al., Circuit Court, State of Wisconsin, Case No. 94CV001212.

In February 1994, NLC served this lawsuit on the Partnership. NLC alleges fraud,
breach of  settlement  contract  and breach of good faith and fair  dealing  and
seeks compensatory,  punitive and exemplary damages in an unspecified amount for
the Partnership's failure to consummate the SF Settlement. In February 1994, the
Partnership filed an answer and requested that the Court stay the action pending
resolution of the SF Lawsuit  including  all appeals.  The Court refused to stay
the action and discovery commenced.  In February 1995, the Court determined that
the  Partnership  could be sued in  Wisconsin  but  stayed  the case  until  the
settlement of the SF Lawsuit has been finalized.

Orlando  Residence  Ltd.  vs. 2300 Elm Hill Pike,  Inc.  and  Nashville  Lodging
Company vs. Metric Partners  Growth Suite  Investors,  L.P.,  Chancery Court for
Davidson County, in Nashville,  Tennessee,  Case No. 94-1911-I  ("Nashville Case
II").

Orlando filed this action against 2300 and NLC in the Davidson  County  Chancery
Court to  attempt to execute on its  judgment  against  Nelson,  NLC and 2300 in
Nashville Case I by subjecting the Land to sale. In May 1995, 2300 and NLC filed
a  third-party  complaint  against the  Partnership,  alleging it had refused to
purchase  the Land as  required  by the SF  Settlement.  2300  and NLC  demanded
payment by the  Partnership of 2300 and NLC's costs of defending  Nashville Case
II and indemnification for any loss resulting from the claims of Orlando,  among
other claims of damage.

In February  1996,  the Court granted a motion filed by 2300 and NLC for partial
summary  judgment,  ruling that the  Partnership had breached the SF Settlement.
The action will continue to determine damages and other issues.  The Partnership
does not believe it breached the SF Settlement and will appeal this ruling at an
appropriate time. However, no  assurance can  be given that  its appeal  will be
successful.

In late October 1997,  2300 and NLC filed a motion for an injunction to prohibit
GSI from distributing proceeds from the sale of the Residence Inns owned by GSI,
pending a final  judgment  in this case.  A hearing  on this  motion was held in
February  1998  and  the  Court  enjoined  the   Partnership   from   conveying,
transferring,  distributing  or  otherwise  disposing  of its cash to any extent
which would  leave less than $5 million  available  for payment of any  judgment
obtained by 2300 and NLC.

2300 and NLC filed an amended  complaint  against the Partnership in April 1998,
asserting,   among  other  things,  a  bad  faith  breach  of  contract  by  the
Partnership.  In May 1998,  the Court  granted  a motion by the  Partnership  to
dismiss these bad faith  allegations  and to dismiss certain claims for specific
damages  made by 2300  and  NLC,  including  attorneys'  fees  and the  value of
Nelson's time relating to efforts to enforce the SF Settlement.

In late October 1998, 2300 and NLC filed a second amended  complaint,  asserting
that a certain 1989  three-party  agreement  among NLC, the  Partnership and the
holder of a mortgage on the Hotel and the Land  entitles  2300 and NLC to obtain
judgment for, among other things, the cost,  including  attorney's fees, of this
action and of  Nelson's  time and  efforts on behalf of NLC in this  action.  In
November 1998, the Court granted a motion filed by the  Partnership,  dismissing
the claim of NLC and 2300 to recover for the value of Nelson's  time and efforts
on behalf of NLC in this and related litigation.

In December 1998, the Court granted a motion for partial summary  judgment filed
by the  Partnership,  dismissing most of the remaining damage claims of 2300 and
NLC, including claims for indemnification for any loss resulting from the claims
                                      -26-
<PAGE>
of Orlando. After these claims were dismissed, 2300 and NLC amended their damage
claim to seek to recover  the  alleged  differential  between the price that the
Partnership  agreed to pay for the Land and its alleged fair market  value.  The
amount of this claim is approximately $1.6 million.

The trial of the case,  which had  previously  been set for February 9, 1998 and
continued  to March 15,  1999,  has been  further  continued  to permit  limited
discovery related to this new claim.

Metric Partners Growth Suite Investors,  L.P., vs.  Nashville  Lodging Co., 2300
Elm Hill Pike,  Inc.,  Orlando  Residence  Ltd.,  and LaSalle  National Bank, as
trustee under that certain pooling and servicing agreement,  dated July 11, 1995
for the holders of the WHP Commercial Mortgage Pass Through Certificates, Series
1995C1 and Robert  Holland,  Trustee,  Chancery  Court for Davidson  County,  in
Nashville, Tennessee, Case No. 96-1405-III ("Nashville Case III").

GSI filed this  action May 3, 1996 to obtain,  among  other  things,  a judicial
determination  of the  rights  and  obligations  of GSI and NLC under the senior
mortgage on the Hotel ("Senior  Mortgage"),  a note held by NLC "wrapped around"
the Senior  Mortgage (the "Wrap Note") and the Lease as a  consequence  of GSI's
cure of certain defaults by NLC under the Senior Mortgage.  GSI believed that as
a result of such a cure,  it became the direct  obligor to the lender  under the
Senior  Mortgage and that the Wrap Note had been  satisfied and the payments due
under  Lease  reduced by  $50,000  per year.  GSI also  sought  preliminary  and
permanent  injunctive  relief to prevent NLC from  attempting  to  accelerate or
foreclose  the Wrap Note and/or from  attempting  to enforce any  remedies  with
regard to the Lease in connection  with this matter and a judgment  establishing
that GSI is the  owner of the  Hotel,  subject  only to the  lease  and  certain
specified security interests.

In May 1996, the Partnership  obtained a temporary  injunction  staying NLC from
undertaking  any efforts to exercise any  remedies  pursuant to the Wrap Note or
the Lease.  NLC and 2300 filed an answer in June,  together with a  counterclaim
against the  Partnership.  NLC and 2300 claimed damages from the Partnership and
asked the Court to permit  acceleration  of the Wrap Note and termination of the
Lease. In July 1996, the Partnership filed a motion for summary judgment in this
case,  asking  that the Court  award the relief  sought by it and that the Court
dismiss the  counterclaim  of NLC and 2300.  At a hearing on this motion held in
August 1996 the Court granted the Partnership's  motion. The defendants appealed
all  judgments  for  the  Partnership  in this  case.  The  Partnership  and the
defendants agreed on an attorneys' fee award to the Partnership of $60,000,  but
no payment was expected until the defendants' appeal is resolved. Oral arguments
regarding  this  appeal  were  held in July  1998,  and in  September  1998  the
appellate court affirmed the judgments for the Partnership. Defendants moved for
rehearing,  which was denied in early  October  1998.  Defendants  then filed an
application  with the  Tennessee  Supreme  Court for  permission  to appeal  the
appellate court decision.  This application was denied by the Tennessee  Supreme
Court in early March 1999.  Subsequently,  Defendants  petitioned  the Tennessee
Supreme Court to reconsider its denial.  While counsel for the Partnership  does
not believe such a petition is  authorized  by  Tennessee  law, no action on the
petition for reconsideration has yet been taken by the Tennessee Supreme Court.

Kenneth E. Nelson and Nashville  Lodging Co. vs. Metric Realty et al.,  Chancery
Court for Davidson County in Nashville,  Tennessee,  Case No.  97-2189-III  (the
"Inducement Action").

In the  second  quarter  of 1997,  Nelson  alleged  that  Metric  Realty and GHI
Associates II, L.P., the Managing and Associate General Partners,  respectively,
of the Partnership, and certain of Metric Realty's affiliates (the "Affiliates")
and certain former and current employees of Metric Realty or its affiliates (the
"Employees") had improperly induced the Partnership to breach the SF Settlement.
In June 1997,  Nelson and NLC filed the Inducement  Action in the Chancery Court
for Davidson  County in Nashville,  Tennessee  (the  "Chancery  Court")  against
Metric  Realty,  GHI  Associates  II, L.P.,  the  Affiliates  and certain of the
Employees   (the   "Inducement   Action   Defendants"),    seeking   unspecified
compensatory, treble and punitive damages for the alleged improper inducement of
breach of contract.

The Inducement Action Defendants  removed the lawsuit from the Chancery Court to
the U.S.  District  Court for  Tennessee on July 25,  1997.  On August 11, 1997,
Nelson  asked the  Court to remand  this  action  to the  Chancery  Court and on
January 28, 1998, the Court remanded this action back to the Chancery  Court. In
the  Inducement  Action,  Defendants  in June 1998 filed a motion to dismiss the
complaint  against the Employees and one of the  Affiliates  named in the action
based on lack of  jurisdiction  and against the  remaining  Affiliates  based on
failure to state a claim.  The Chancery  Court in September  1998  dismissed the
complaint  against all Affiliates but one and denied the remaining  requests for
dismissal.

A motion for summary  judgment to dismiss the action on the basis of the statute
of limitations was filed in January 1999 by the Inducement Action Defendants and
was argued at a hearing  held in February  1999.  No decision on this motion has
yet been rendered.
                                      -27-
<PAGE>

The  legal  and  other  expenses  of the  Inducement  Action  Defendants  in the
Inducement  Action arising as a result of the allegations made by Nelson will be
paid  by the  Partnership  pursuant  to the  indemnification  provisions  of the
Partnership's  limited  partnership  agreement and subject to the conditions set
forth in those provisions.

9.    Going Concern

As discussed in Note 8, the  Partnership is subject to ongoing  litigation.  The
litigation has resulted in  substantial  legal fees and costs that have been and
are  expected  to  be  incurred  by  the  Partnership  and  which  have  created
difficulties  in  refinancing  or  disposing of the  Residence  Inn - Nashville.
Although it is management's  current  intention to dispose of the property via a
deed in lieu of foreclosure,  it is uncertain that this  transaction will occur.
Additionally,  the  Partnership  may be required to pay the $1,400,000  contract
cancellation  fee to the  manager of the hotel,  plus  other  costs,  and may be
obligated  to pay the deferred  rent under the ground lease with the  landowner.
These conditions create  substantial  doubt about the  Partnership's  ability to
continue  as a going  concern.  The  accompanying  financial  statements  do not
include any adjustments that might result from these uncertainties.

10.   Reconciliation to Income Tax Method of Accounting

The  differences  between the method of accounting  for income tax reporting and
the  accrual  method  of  accounting  used in the  financial  statements  are as
follows:

<TABLE>
<CAPTION>
                                                                  1998            1997            1996
                                                                  ----            ----            ----
                                                             
<S>                                                            <C>            <C>            <C>             
Net income (loss)-- financial statements ....................  $   (123,000)  $ 10,319,000   $    521,000
Differences resulted from:
     Gain on sale of property ...............................      (300,000)       613,000           --
     Impairment provision for asset to be disposed of .......       195,000           --             --
     Depreciation ...........................................        34,000       (683,000)      (137,000)
     Prepayment penalties ...................................          --         (438,000)          --
     Amortization of notes payable discount .................          --          148,000        135,000
     Interest ...............................................        10,000        (23,000)        (6,000)
     Other ..................................................       (61,000)       (54,000)       (58,000)
                                                               ------------   ------------   ------------

Net income (loss) - income tax method .......................  $   (245,000)  $  9,882,000   $    455,000
                                                               ============   ============   ============

Taxable income (loss) per limited partnership assignee unit
after giving effect to the allocation to the general partners  $         (4)  $        161   $          3
                                                               ============   ============   ============

Net assets and liabilities - financial statements ...........  $ 11,700,000   $ 29,463,000   $ 21,590,000
Cumulative differences resulted from:
     Gain on sale of property ...............................          --          300,000        300,000
     Impairment provision for asset to be disposed of .......       195,000
     Depreciation ...........................................       124,000         90,000        514,000
     Amortization of notes payable discount .................          --             --        2,347,000
     Interest ...............................................        86,000         76,000     (2,211,000)
     Capital account adjustment .............................          --             --        5,993,000
     Other ..................................................       (20,000)        41,000         (6,000)
                                                               ------------   ------------   ------------

Net assets and liabilities - income tax method ..............  $ 12,085,000   $ 29,970,000   $ 28,527,000
                                                               ============   ============   ============
</TABLE>


                                      -28-
<PAGE>
<TABLE>
                                                                                                               SCHEDULE III
                                   METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
                                         a California Limited Partnership

                                     REAL ESTATE AND ACCUMULATED DEPRECIATION
                                                 December 31, 1997
<CAPTION>

COLUMN                COLUMN        COLUMN            COLUMN                 COLUMN             COLUMN    COLUMN    COLUMN
     A                   B             C                 D                      E                  F         G         H

                                                      Cost Capitalized
                                         Initial Cost   Subsequent       Gross Amount at Which
                                        to Partnership to Acquisition Carried at Close of Period(1)
                                        -------------- -------------- -----------------------------
                                                                                                 Accumu-     Date
                                              Buildings                       Buildings          lated        of      Date
                                                and                              and            Deprecia-    Con-      of
                             Encum-           Improve- Improve- Carrying       Improve-           tion      struc-    Acqui-
Description                  brances   Land   ments    ments     Costs Land     ments   Total(2)  (3)(4)     tion     sition
-----------                  -------   ----   -----    -----     ----- ----     -----   --------  ------     ----     ------

                                             (Amounts in thousands)
HOTEL:
<S>                            <C>           <C>       <C>       <C>            <C>      <C>      <C>         <C>      <C>
Residence Inn-Nashville
 (Airport)
   Nashville, Tennessee.......$8,514         $11,416   $3,018    $(525)         $13,909  $13,909  $5,263      1/85     5/26/89
                              ======         =======   ======    ======         =======  =======  ======

</TABLE>

                             See accompanying notes.

                                      -29-
<PAGE>

<TABLE>

                                                                                             SCHEDULE III


                                   METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.
                                         A California Limited Partnership

                                     REAL ESTATE AND ACCUMULATED DEPRECIATION

<CAPTION>

NOTES:
<S>                                                                                          <C>          
(1)   The aggregate  costs for Federal income tax purposes are  $14,256,000  and
      $13,985,000 as of December 31, 1998 and December 31, 1997, respectively.

(2)   Balance, January, 1, 1996..............................................................$  87,885,000
      Capital improvements....................................................................   2,571,000
                                                                                              ------------

      Balance, December 31, 1996..............................................................  90,456,000
      Cost of properties and improvements sold................................................ (78,797,000)
      Capital improvements....................................................................   2,250,000
                                                                                              ------------
      Balance, December 31, 1997..............................................................  13,909,000
      Capital improvements....................................................................     262,000
      Property and improvements reclassified to asset to be disposed of....................... (14,171,000)
                                                                                              ------------
      Balance, December 31, 1998.............................................................$           -
                                                                                              ============

(3)   Balance, January, 1, 1996..............................................................$  28,935,000
      Additions charged to expense............................................................   2,890,000
                                                                                              ------------

      Balance, December 31, 1996..............................................................  31,825,000
      Accumulated depreciation on properties and improvements sold............................ (28,297,000)
      Additions charged to expense............................................................   1,735,000
                                                                                              ------------

      Balance, December 31, 1997..............................................................   5,263,000
      Additions charged to expense............................................................     528,000
      Accumulated depreciation reclassified to asset to be disposed of.......................   (5,791,000)
                                                                                              ------------
      Balance, December 31, 1998.............................................................$           -
                                                                                              ============
(4)   Depreciation is computed on lives ranging from six to 30 years.
</TABLE>

Item  9.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure.

The information  called for by this item is incorporated  herein by reference to
the Registrant's Current Report on Form 8-K filed September 14, 1994 (Commission
File No. 0-17660).

                                      -30-
<PAGE>


                                    PART III

Item 10.  Directors and Executive Officers of the Registrant.
The  Partnership  has no  directors  or executive  officers.  For  informational
purposes only, the following are the names and additional  information  relating
to the directors  and  executive  officers of SSR Realty  Advisors,  Inc.  ("SSR
Realty"), the managing partner of Metric Realty, the managing general partner of
the Partnership.
      (a)  Directors

Thomas P. Lydon, Jr.
Director, President and Chief Executive Officer, SSR Realty

Mr. Lydon age 50, has been President and Chief Executive  Officer of SSR Realty,
or one of its predecessor  companies  since February 1995.  Since March 1997, he
has also been Chairman of the Board and Chief Executive Officer of Metric Income
Trust Series,  Inc., a publicly-held  real estate investment trust, of which SSR
Realty is the  Advisor.  Prior to joining SSR Realty,  Mr.  Lydon was from April
1992, an Executive  Vice  President of MBL Life  Assurance  Corporation  ("MBL")
(formerly  Mutual  Benefit  Life  Insurance  Company)  chosen by the New  Jersey
Department  of Insurance to oversee and  reorganize  the real estate  investment
division of MBL. Mr. Lydon's  experience  before joining MBL included serving as
Executive Vice President and Principal of Manhattan Capital Realty  Corporation,
an investment  banking firm,  from 1990 to 1992; and as Senior Vice President of
Unicorp American Corporation, a real estate and banking firm, from 1985 to 1990.
Mr.  Lydon  graduated  from  Syracuse  University  with a  Bachelor's  Degree in
Business Administration in 1970.

Ralph F. Verni
Chairman of the Board, SSR Realty

Mr. Verni,  age 56, was elected to his position with a predecessor of SSR Realty
in March 1993. He joined State Street  Research and Management  Company  ("State
Street   Research"),   a  subsidiary  of  Metropolitan  Life  Insurance  Company
("MetLife"),  in 1992  as  Chairman  and  Chief  Executive  Officer  and  became
President in January 1993. He also serves as Director, President and CEO of SSRM
Holdings,  Inc., a wholly-owned  subsidiary of MetLife which in turn serves as a
holding company for several of MetLife's investment management subsidiaries.  He
is a trustee of 11 registered  investment companies in the State Street Research
Fund complex  which are managed by State Street  Research or an  affiliate.  Mr.
Verni is a member of the Advisory  Committee  for the MIT Center for Real Estate
Development, the Colgate University Board of Trustees and its Finance Committee,
the Advisory Committee of Commonwealth Capital Ventures,  L.P., and Commonwealth
Capital Ventures II, L.P. Prior to joining State Street Research,  Mr. Verni was
President and Chief Executive  Officer of New England  Investment  Companies,  a
holding company for the real estate,  investment  management,  and broker/dealer
subsidiaries  of New England Mutual Life Insurance  Company ("The New England"),
and was also the Chief  Investment  Officer and a director  of The New  England.
Prior to  joining  The New  England  in 1982,  Mr Verni  spent 16 years with The
Equitable Life Assurance Company in senior investment management  positions.  He
holds a  Bachelor's  Degree from  Colgate  University  and a Master's  Degree in
Business Administration from Columbia University.

Gerard P. Maus
Director, SSR Realty

Mr.  Maus,  age 47, was  elected as a director of a  predecessor  company of SSR
Realty  in March  1993.  He joined  State  Street  Research  as  Executive  Vice
President,  Chief Financial Officer and Chief Administrative Officer in February
1993.  Prior to joining State Street,  Mr. Maus served since 1983 as a financial
officer of New England and its  subsidiary,  New  England  Investment  Companies
("NEIC"),  most recently as Executive Vice President and Chief Financial Officer
of NEIC from 1990 to January 1993.  Prior to holding these  positions,  Mr. Maus
held  financial  positions  with Bank of New  England,  Coopers &  Lybrand,  and
Liberty Mutual Life Insurance Company.  He received a Bachelor of Arts Degree in
Business  Administration  from  Rutgers  University  in 1973 and is a  Certified
Public Accountant.

                                      -31-
<PAGE>


      (b)  Executive Officers

William A. Finelli
Managing Director and Chief Financial Officer, SSR Realty

Mr.  Finelli,  age 41, has been Managing  Director,  and Vice  President,  Chief
Financial  Officer  and  Treasurer  of SSR  Realty  or  one  of its  predecessor
companies  since August 1995. He is  responsible  for  overseeing the day to day
activity of the accounting,  finance,  legal,  technology and valuation areas of
SSR Realty.  Before he joined SSR Realty,  Mr. Finelli served from November 1983
as a financial executive of MBL. His last position with MBL was Vice President -
Real Estate Accounting.  Prior to his years at MBL, Mr. Finelli was with Ernst &
Young, a public accounting firm. Mr. Finelli  graduated from Rutgers  University
with a  Bachelor's  Degree  in  Accounting  in 1979  and is a  certified  public
accountant.

Herman H. Howerton
Managing Director and General Counsel, SSR Realty

Mr.  Howerton,  age 55,  has  served as  General  Counsel  of SSR  Realty or its
predecessor  companies  since 1988.  From 1984 to 1988,  he was  employed by Fox
Capital  Management  Corporation  ("FCMC") in various  legal  positions.  He was
employed by Cushman & Wakefield in commercial  leasing from 1983 to 1984.  Prior
to that,  from 1972 to 1982,  Mr.  Howerton  held  various  positions  with Itel
Corporation,   including  those  of  Vice   President-Administration   and  Vice
President,  General Counsel and Secretary. He received a Bachelor of Arts Degree
from California  State University at Fresno in 1965 and a Juris Doctorate Degree
from Harvard Law School in 1968.  He is a member of the State Bar of  California
and a licensed California real estate broker.

Ronald E. Zuzack
Executive Managing Director, SSR Realty

Mr. Zuzack, age 55, has been in charge of the Multi-Housing Operating Company of
SSR Realty since its  organization in April 1997, and was in charge of Portfolio
Services for certain predecessor  companies since March 1988. From 1981 to 1988,
he was employed by FCMC in various portfolio management positions. Prior to 1981
he was employed by Union Bank as Vice President/Manager Real Estate,  Sacramento
Region, and acted as Vice President,  Development and Property  Management while
employed by  Inter-Cal  Real Estate  Corporation.  He received  his  Bachelor of
Science  Degree  and  Master's  Degree  in  Business   Administration  from  the
University of Missouri.

Item 11.  Executive Compensation.

The Partnership  does not pay or employ any directors or officers.  Compensation
to the  directors  and officers of SSR Realty,  the  managing  partner of Metric
Realty (the managing general partner of the Partnership),  is paid by SSR Realty
or its affiliates and is not related to the results of the Partnership.

The Partnership has not established any plans pursuant to which plan or non-plan
compensation  has been paid or  distributed  during the last  fiscal  year or is
proposed to be paid or distributed in the future, nor has the Partnership issued
or  established  any  options  or  rights  relating  to the  acquisition  of its
securities or any plan relating to such options or rights.  However,  SSR Realty
is expected to receive  certain  allocations,  distributions  and other  amounts
pursuant  to the  Partnership's  limited  partnership  agreement.  In  addition,
included  in  the  expense  reimbursements  made  to  such  general  partner  or
affiliates by the Partnership is an allocation for a portion of the compensation
(including  employee benefit plans) paid to personnel rendering asset management
services to the Partnership.

Item 12.  Security Ownership of Certain Beneficial Owners and Management.

There is no person known to the Partnership  who owns  beneficially or of record
more than five percent of the voting securities of the Partnership.  Neither the
Partnership's  managing  general  partner nor  affiliates  of the  Partnership's
managing general partner have contributed capital to the Partnership.

                                      -32-
<PAGE>

The Partnership is a limited  partnership and has no officers or directors.  The
managing  general partner has  discretionary  control over most of the decisions
made by or for the  Partnership in accordance  with the terms of the Partnership
Agreement.  Each of the  directors  and officers of the managing  partner of the
Partnership's managing general partner, and all of these individuals as a group,
own less than one percent of the Partnership's voting securities.

There are no arrangements known to the Partnership, the operations of which may,
at a subsequent date, result in a change in control of the Partnership.

Item 13.  Certain Relationships and Related Transactions.

None;  except  that the  Partnership  in 1998 paid and in 1999 will pay fees and
expense   reimbursements   to  Metric  Realty  for  services   provided  to  the
Partnership.  See the Prospectus filed pursuant to Rule 424(b) of the Securities
Act of 1933,  which  is  incorporated  by  reference  herein,  and Note 2 to the
financial  statements in Item 8. All of the individuals  listed in Item 10 above
are officers and  employees  of and receive  compensation  from SSR Realty or an
affiliate.

                                     PART IV

Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

(a)   1., 2. and 3. See Item 8 of Form  10-K for  Financial  Statements  for the
      Partnership, Notes thereto, and Financial Statement Schedules. (A table of
      contents to Financial  Statements  and  Financial  Statement  Schedules is
      included in Item 8 and incorporated herein by reference.)

(b)   No reports on Form 8-K were  required to be filed  during the last quarter
      of the period covered by this Report.

(c)   Financial Statement Schedules, if required by Regulation S-K, are included
      in Item 8.

                                      -33-
<PAGE>


                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                   REGISTRANT

                        METRIC  PARTNERS  GROWTH  SUITE  INVESTORS,  L.P.,
                        a California Limited Partnership

                               By:   Metric Realty,
                                     an Illinois general partnership,
                                     its Managing General Partner

                               By:   SSR Realty Advisors, Inc.,
                                     a Delaware corporation,
                                     its Managing General Partner


                               By:   /s/ Thomas P. Lydon, Jr. 
                                     -------------------------------------------
                                     Thomas P. Lydon, Jr.
                                     President and Chief Executive Officer,
                                     SSR Realty Advisors, Inc.

                               Date: March 30, 1999
                                     -------------------------------------------

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the date indicated.


By: /s/ William A. Finelli                 By: /s/ Ralph F. Verni
    ------------------------------------       ---------------------------------
    William A. Finelli                         Ralph F. Verni
    Managing Director and Chief Financial      Chairman of the Board, SSR 
    Officer, SSR Realty Advisors, Inc.         Realty Advisors, Inc.



By: /s/ Gerard P. Maus                     By: /s/ Thomas P. Lydon, Jr.        
    ------------------------------------       ---------------------------------
    Gerard P. Maus                             Thomas P. Lydon
    Director, SSR Realty Advisors, Inc.        Director, SSR Realty Advisors, 
                                               Inc.



Date:  March 30, 1999                             
    ------------------------------------
                  

                                      -34-