SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 25049

                                   Form 10-KSB
(Mark One)
[X]   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
         1934


                   For the fiscal year ended December 31, 2002

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
         OF 1934


                    For the transition period from _________to _________

                         Commission file number 0-16684

                         MULTI-BENEFIT REALTY FUND '87-1
                 (Name of small business issuer in its charter)

         California                                            94-3026785
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                            Identification No.)

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

                 (864) 239-1000 Issuer's telephone number,
                                including area code

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

                                      None

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

                          Units of Limited Partnership
                                (Title of class)

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

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

State issuer's revenues for its most recent fiscal year.  $3,780,000

State the aggregate  market value of the voting  partnership  interests  held by
non-affiliates  computed  by  reference  to the price at which  the  partnership
interests  were sold,  or the average bid and asked  prices of such  partnership
interests as of December 31, 2002. No market exists for the limited  partnership
interests of the Registrant,  and,  therefore,  no aggregate market value can be
determined.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None

The matters discussed in this report contain certain forward-looking statements,
including, without limitation, statements regarding future financial performance
and the effect of government  regulations.  The discussions of the  Registrant's
business  and  results  of  operations,   including  forward-looking  statements
pertaining to such matters,  do not take into account the effects of any changes
to the  Registrant's  business  and results of  operations.  Actual  results may
differ  materially  from those described in the  forward-looking  statements and
will  be  affected  by  a  variety  of  risks  and  factors  including,  without
limitation:  national and local economic  conditions;  the terms of governmental
regulations that affect the Registrant and interpretations of those regulations;
the competitive  environment in which the Registrant operates;  financing risks,
including the risk that cash flows from  operations may be  insufficient to meet
required  payments of  principal  and  interest;  real estate  risks,  including
variations  of real  estate  values and the  general  economic  climate in local
markets and competition for tenants in such markets; and possible  environmental
liabilities.   Readers  should  carefully  review  the  Registrant's   financial
statements and the notes thereto,  as well as the risk factors  described in the
documents  the  Registrant  files  from  time to time  with the  Securities  and
Exchange Commission.

                                     PART I

Item 1.     Description of Business

Multi-Benefit   Realty  Fund  '87-1  (the  "Partnership"  or  "Registrant")  was
organized on September 8, 1986, as a limited  partnership  under the  California
Revised Limited  Partnership Act. ConCap  Equities,  Inc. ("CEI") is the general
partner of the Partnership (see additional information below). CEI (the "General
Partner")  is a  subsidiary  of  Apartment  Investment  and  Management  Company
("AIMCO"), a publicly traded real estate investment trust.

Commencing December 10, 1986, the Registrant offered, pursuant to a Registration
Statement  filed with the  Securities  and Exchange  Commission,  $60,000,000 of
Units of  Depositary  Receipts  (collectively,  the "Units,"  and  individually,
"Unit").   Upon  the  closing  of  the  offering,   the   Partnership   received
subscriptions for 172,436 Units resulting in gross proceeds of $17,244,000.  The
Units were sold in two  different  classes,  ("A" Units and "B" Units) which are
entitled  to  different  rights  and  priorities  as to cash  distributions  and
Partnership allocations. The Units represent economic rights attributable to the
limited partnership  interests in the Partnership and entitle the holders ("Unit
holders") thereof to participate in certain allocations and distributions of the
Partnership.  The General Partner of the Partnership intended that the "A" Units
and "B" Units be  allocated  such that the "B" Units would not exceed 25% nor be
less than 20% of the total  amount of the Units sold.  At the end of the current
fiscal year, the "B" Units represented  approximately 44% of the total amount of
the Units sold. The General Partner is currently considering several alternative
procedures  to  conform  the  unit  allocations  more  closely  to the  intended
investment  objectives  but has not yet determined a feasible  alternative.  The
corporate limited partner of the Partnership was Multi-Benefit  '87-1 Depositary
Corporation, an affiliate of the General Partner. The Partnership may repurchase
or retire any Units, at its absolute  discretion,  but is under no obligation to
do so.  Since its initial  offering,  1,000 Units have been  retired.  Since its
initial  offering,  the Partnership has not received,  nor are limited  partners
required to make, additional capital contributions.

Upon  the  Partnership's   formation  in  1986,  Consolidated  Capital  Equities
Corporation  ("CCEC"), a Colorado  corporation,  was the sole general partner of
the Partnership and the corporate limited partner, a wholly-owned  subsidiary of
CCEC, was the sole limited partner.  In 1988,  through a series of transactions,
Southmark Corporation  ("Southmark") acquired a controlling interest in CCEC. In
December  1988,  CCEC filed for  reorganization  under  Chapter 11 of the United
States  Bankruptcy  Code. In 1990, as part of CCEC's  reorganization  plan,  CEI
acquired  CCEC's general  partner  interest in the  Partnership  and in 15 other
affiliated public limited partnerships (the "Affiliated Partnerships"), acquired
the stock of the corporate  limited  partner,  and CEI replaced CCEC as managing
general  partner  in all  16  partnerships.  The  selection  of CEI as the  sole
managing  general  partner was approved by a majority of the Unit holders in the
Partnership and of the limited  partners in each of the Affiliated  Partnerships
pursuant to a solicitation of the Unit holders dated August 10, 1990. As part of
this  solicitation,   the  Unit  holders  also  approved  an  amendment  to  the
Partnership Agreement to limit changes of control of the Partnership.

All of CEI's outstanding  stock was owned by Insignia  Properties Trust ("IPT"),
which acquired the stock through two  transactions  in December 1994 and October
1995. Effective February 26, 1999, IPT was merged into AIMCO.

The  Registrant  is engaged in the business of operating and holding real estate
properties for investment.  The Partnership  originally acquired three apartment
properties.  During the year ended  December 31, 2000, one of the properties was
sold. The Registrant continues to own and operate the other two properties.  See
"Item 2. Description of Properties". The Partnership Agreement provides that the
Partnership  is to terminate on December 31, 2036,  unless  terminated  prior to
such date.

The Registrant has no employees. Property management and administrative services
are  provided  by the  General  Partner  and by agents  retained  by the General
Partner.  An affiliate of the General Partner provides such property  management
services.

Risk Factors

The  real  estate  business  in which  the  Partnership  is  engaged  is  highly
competitive.  There are other  residential  properties within the market area of
the Partnership's properties.  The number and quality of competitive properties,
including those which may be managed by an affiliate of the General Partner,  in
such  market  area  could have a  material  effect on the rental  market for the
apartments at the Partnership's properties and the rents that may be charged for
such apartments. While the General Partner and its affiliates own and/or control
a  significant  number of  apartment  units in the  United  States,  such  units
represent an  insignificant  percentage of total  apartment  units in the United
States and competition for the apartments is local.

Laws benefiting  disabled persons may result in the Partnership's  incurrence of
unanticipated  expenses.  Under the Americans with  Disabilities Act of 1990, or
ADA,  all places  intended to be used by the public are required to meet certain
Federal  requirements  related to access and use by disabled persons.  Likewise,
the Fair Housing Amendments Act of 1988, or FHAA, requires apartment  properties
first occupied after March 13, 1990 to be accessible to the  handicapped.  These
and other  Federal,  state  and  local  laws may  require  modifications  to the
Partnership's   properties,   or  restrict   renovations   of  the   properties.
Noncompliance  with  these laws could  result in the  imposition  of fines or an
award of  damages  to private  litigants  and also  could  result in an order to
correct any  non-complying  feature,  which could result in substantial  capital
expenditures.  Although  the General  Partner  believes  that the  Partnership's
properties  are  substantially  in  compliance  with present  requirements,  the
Partnership  may incur  unanticipated  expenses  to comply  with the ADA and the
FHAA.


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

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

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

Insurance  coverage is becoming  more  expensive  and  difficult to obtain.  The
current  insurance market is  characterized by rising premium rates,  increasing
deductibles,  and more restrictive  coverage language.  Recent developments have
resulted in  significant  increases in insurance  premiums and have made it more
difficult to obtain  certain types of insurance.  As an example,  many insurance
carriers are excluding  mold-related  risks from their policy coverages,  or are
adding  significant  restrictions to such coverage.  Continued  deterioration in
insurance   market  place   conditions  may  have  a  negative   effect  on  the
Partnership's operating results.

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

Item 2.     Description of Properties

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

                                    Date of
Property                           Purchase      Type of Ownership        Use

Hunt Club Apartments                 05/87   Fee ownership subject to  Apartment
  Indianapolis, Indiana                      first mortgage (1)        200 units

Shadow Brook Apartments              05/87   Fee ownership subject to  Apartment
  West Valley City, Utah                     first mortgage            300 units

(1) The property is held by a limited  partnership in which the Partnership owns
a 99% interest.

Schedule of Properties

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

<TABLE>
<CAPTION>

                             Gross
                            Carrying   Accumulated                        Federal
Property                     Value    Depreciation    Rate    Method     Tax Basis
                                (in thousands)                         (in thousands)

<S>                         <C>          <C>          <C>                  <C>
Hunt Club Apartments        $ 7,937      $ 5,243      5-30     S/L         $3,637
Shadow Brook Apartments      11,366        6,160      5-30     S/L          5,401

  Total                     $19,303      $11,403                           $9,038
</TABLE>

See  "Note A" to the  consolidated  financial  statements  included  in "Item 7.
Financial Statements" for a description of the Partnership's  capitalization and
depreciation policies.

Schedule of Property Indebtedness

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

<TABLE>
<CAPTION>

                       Principal                                         Principal
                       Balance At      Stated                             Balance
                      December 31,    Interest    Period    Maturity       Due At
Property                  2002          Rate     Amortized    Date      Maturity (1)
                     (in thousands)                                    (in thousands)
Hunt Club
<S>                     <C>            <C>       <C>          <C>           <C>
  1st mortgage          $ 3,706        8.05%     20 years     09/20         $ --
Shadow Brook
  1st mortgage            8,515        7.10%     20 years     09/21            --

                        $12,221                                             $ --
</TABLE>

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

On August 31, 2001, the Partnership  refinanced the mortgage  encumbering Shadow
Brook Apartments. The refinancing replaced indebtedness of $6,000,000 with a new
mortgage of $8,775,000. The new mortgage carries a stated interest rate of 7.10%
as  compared to the 7.33%  interest  rate on the old  mortgage.  Payments on the
mortgage  loan are due monthly  until the loan  matures on  September 1, 2021 at
which time the loan is scheduled to be fully amortized.  Total  capitalized loan
costs were  approximately  $281,000 during the year ended December 31, 2001. The
Partnership   recognized  a  loss  on  the  early   extinguishment  of  debt  of
approximately $47,000 due to the write-off of unamortized loan costs.

Schedule of Rental Rates and Occupancy

Average annual rental rates and occupancy for 2002 and 2001 for each property:

                                   Average Annual               Average Annual
                                    Rental Rates                  Occupancy
                                     (per unit)
Property                         2002           2001          2002          2001

Hunt Club Apartments            $7,876         $8,018          93%          92%
Shadow Brook Apartments          7,364          7,257          95%          97%

As noted under "Item 1.  Description of Business",  the real estate  industry is
highly  competitive.  Both of the properties of the  Partnership  are subject to
competition from other residential  apartment complexes in the area. The General
Partner  believes  that both of the  properties  are  adequately  insured.  Each
property is an  apartment  complex  which  leases units for terms of one year or
less. No tenant leases 10% or more of the  available  rental space.  Both of the
properties are in good physical  condition,  subject to normal  depreciation and
deterioration as is typical for assets of this type and age.

Schedule of Real Estate Taxes and Rates

Real estate taxes and rates in 2002 for each property were:

                                                2002            2002
                                                Taxes           Rates
                                           (in thousands)

       Hunt Club Apartments                     $157            3.51%
       Shadow Brook Apartments                   100            1.41%

Capital Improvements

Hunt Club

During the year ended December 31, 2002, the Partnership completed approximately
$70,000  of  capital  expenditures   consisting  primarily  of  appliance,   air
conditioning  unit, and floor covering  replacements  and water heater upgrades.
These  improvements  were funded from  Partnership  reserves and operating  cash
flow. The Partnership is currently  evaluating the capital  improvement needs of
the property for the upcoming year and currently expects to budget approximately
$60,000.  Additional  improvements may be considered during 2003 and will depend
on the physical condition of the property as well as Partnership's  reserves and
anticipated cash flow generated by the property.

Shadow Brook

During the year ended December 31, 2002, the Partnership completed approximately
$102,000 of capital  expenditures  consisting  primarily  of major  landscaping,
parking area upgrades, and floor covering replacements.  These improvements were
funded from  operating cash flow.  The  Partnership is currently  evaluating the
capital  improvement  needs of the property for the upcoming  year and currently
expects  to  budget  approximately  $90,000.   Additional  improvements  may  be
considered during 2003 and will depend on the physical condition of the property
as well as anticipated cash flow generated by the property.

Item 3.     Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the Partnership,  its General Partner and several of
their  affiliated  partnerships and corporate  entities.  The action purports to
assert  claims on behalf of a class of  limited  partners  and  derivatively  on
behalf of a number of limited partnerships (including the Partnership) which are
named as nominal defendants, challenging, among other things, the acquisition of
interests in certain General Partner entities by Insignia  Financial Group, Inc.
("Insignia") and entities which were, at one time, affiliates of Insignia;  past
tender offers by the Insignia  affiliates to acquire limited  partnership units;
management of the  partnerships  by the Insignia  affiliates;  and the series of
transactions  which  closed on October 1, 1998 and  February  26,  1999  whereby
Insignia and Insignia  Properties Trust,  respectively,  were merged into AIMCO.
The plaintiffs seek monetary damages and equitable  relief,  including  judicial
dissolution of the  Partnership.  On June 25, 1998, the General  Partner filed a
motion seeking dismissal of the action. In lieu of responding to the motion, the
plaintiffs  filed an amended  complaint.  The General Partner filed demurrers to
the amended complaint which were heard February 1999.

Pending the ruling on such  demurrers,  settlement  negotiations  commenced.  On
November 2, 1999,  the parties  executed and filed a Stipulation  of Settlement,
settling claims, subject to court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  at which time
the Court set a final  approval  hearing for  December  10,  1999.  Prior to the
December  10,  1999  hearing,  the  Court  received  various  objections  to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement.  On
December  14,  1999,  the General  Partner  and its  affiliates  terminated  the
proposed settlement.  In February 2000, counsel for some of the named plaintiffs
filed a motion to disqualify plaintiff's lead and liaison counsel who negotiated
the settlement.  On June 27, 2000, the Court entered an order disqualifying them
from the case and an appeal was taken  from the order on  October  5,  2000.  On
December 4, 2000, the Court  appointed the law firm of Lieff Cabraser  Heimann &
Bernstein  LLP as new  lead  counsel  for  plaintiffs  and the  putative  class.
Plaintiffs  filed a third  amended  complaint on January 19,  2001.  On March 2,
2001,  the  General  Partner  and its  affiliates  filed a demurrer to the third
amended  complaint.  On May 14, 2001,  the Court heard the demurrer to the third
amended  complaint.  On July 10,  2001,  the Court  issued  an order  sustaining
defendants'  demurrer on certain grounds.  On July 20, 2001,  Plaintiffs filed a
motion for  reconsideration  of the Court's July 10, 2001 order granting in part
and denying in part defendants' demurrer. On September 7, 2001, Plaintiffs filed
a fourth amended class and derivative action  complaint.  On September 12, 2001,
the Court denied Plaintiffs' motion for reconsideration. On October 5, 2001, the
General Partner and affiliated defendants filed a demurrer to the fourth amended
complaint,  which was heard on December 11, 2001. On February 2, 2002, the Court
served its order granting in part the demurrer.  The Court has dismissed without
leave  to amend  certain  of the  plaintiffs'  claims.  On  February  11,  2002,
plaintiffs  filed a motion seeking to certify a putative class  comprised of all
non-affiliated  persons  who own or have owned  units in the  partnerships.  The
General Partner and affiliated  defendants oppose the motion. On April 29, 2002,
the Court held a hearing on plaintiffs' motion for class  certification and took
the matter under submission after further briefing, as ordered by the court, was
submitted by the parties.  On July 10, 2002, the Court entered an order vacating
the  current  trial  date of  January  13,  2003 (as well as the  pre-trial  and
discovery cut-off dates) and stayed the case in its entirety through November 7,
2002 so that the parties could have an  opportunity  to discuss  settlement.  On
October  30,  2002,  the court  entered  an order  extending  the stay in effect
through January 10, 2003.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action described below. The Court
has  scheduled  the hearing on  preliminary  approval  for April 4, 2003 and the
hearing on final approval for June 2, 2003.

In general  terms,  the  proposed  settlement  provides  for  certification  for
settlement  purposes of a settlement class consisting of all limited partners in
this  Partnership and others (the  "Partnerships")  as of December 20, 2002, the
dismissal  with  prejudice  and  release  of claims  in the  Nuanes  and  Heller
litigation,  payment by AIMCO of $9.9  million  (which shall be  distributed  to
settlement  class  members  after  deduction of attorney fees and costs of class
counsel and certain costs of  settlement)  and up to $ 1 million toward the cost
of independent  appraisals of the Partnerships'  properties by a Court appointed
appraiser.  An affiliate of the General Partner has also agreed to make a tender
offer to purchase all of the partnership  interests in the  Partnerships  within
one year of final approval,  if it is granted,  and to provide partners with the
independent  appraisals at the time of these  tenders.  The proposed  settlement
also  provides  for the  limitation  of the  allowable  costs  which the General
Partner or its affiliates  will charge the  Partnerships in connection with this
litigation  and  imposes  limits  on the  class  counsel  fees and costs in this
litigation.  If the Court grants preliminary approval of the proposed settlement
in April, a notice will be distributed to partners providing detail on the terms
of the proposed settlement.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the Managing  General  Partner and affiliated
defendants  moved to strike the first  amended  complaint  in its  entirety  for
violating  the Court's July 10, 2001 order  granting in part and denying in part
defendants'  demurrer in the Nuanes action, or alternatively,  to strike certain
portions of the complaint based on the statute of limitations.  Other defendants
in the action  demurred to the fourth  amended  complaint,  and,  alternatively,
moved to strike the complaint. On December 11, 2001, the court heard argument on
the motions  and took the matters  under  submission.  On February 4, 2002,  the
Court  served  notice of its order  granting  defendants'  motion to strike  the
Heller complaint as a violation of its July 10, 2001 order in the Nuanes action.
On March 27, 2002,  the plaintiffs  filed a notice  appealing the order striking
the  complaint.  Before  completing  briefing on the appeal,  the parties stayed
further proceedings in the appeal pending the Court's review of the terms of the
proposed settlement described above.

The  General  Partner  does not  anticipate  that any costs to the  Partnership,
whether legal or settlement costs,  associated with these cases will be material
to the Partnership's overall operations.

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

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

During the quarter ended  December 31, 2002, no matters were submitted to a vote
of the Unit holders through the solicitation of proxies or otherwise.

                                     PART II

Item 5. Market for the  Registrant's  Units of  Depository  Receipts and Related
Security Holder Matters

No  established  public trading market has developed for the Units of Depository
Receipts  ("Units") and it is not anticipated that such a market will develop in
the future.

      Title of Class:                     Number of Record Unit holders:

      Units of Depositary Receipts
               A Units                    372 as of December 31, 2002
               B Units                    519 as of December 31, 2002

The  Partnership  offered and sold  172,436 "A" and "B" Units.  At December  31,
2002,  the  Partnership  had 96,284 "A" Units and 75,152 "B" Units  outstanding.
Affiliates of the General  Partner held 62,627 "A" Units (65.04%) and 39,384 "B"
Units (52.41%) at December 31, 2002.

The following table sets forth the distributions declared by the Partnership for
the years ended December 31, 2001 and 2002 (see "Item 6. Management's Discussion
and Analysis or Plan of Operation" for more details).

<TABLE>
<CAPTION>

                                                            Distributions
                                                   Per Limited         Per Limited
                                Aggregate        Partnership "A"     Partnership "B"

<S> <C>   <C>  <C>   <C>      <C>        <C>          <C>                 <C>
    01/01/01 - 12/31/01       $3,397,000 (1)          $28.76              $ 8.24
    01/01/02 - 12/31/02          692,000 (2)            7.11                0.00
</TABLE>


(1)  Consists of $898,000 of cash from  operations  and  $2,499,000 of cash from
     the refinancing proceeds of Shadow Brook Apartments.

(2)   Consists of $692,000 of cash from operations.

Upon distribution of sale proceeds from the sale of Carlin Manor during the year
ended  December  31,  2000,  the "A" Unit  holders  did not  receive the correct
priority  return.  As a result,  at December  31, 2002 the "B" Unit holders have
received excess distributions of approximately $1,328,000  (approximately $17.67
per "B" Unit).  Approximately  $1,303,000  of this amount is due to the "A" Unit
holders  (approximately $13.53 per "A" Unit) and approximately $25,000 is due to
the General Partner.  All future  distributions  payable to the "B" Unit holders
will be paid to the "A" Unit  holders  until the "A" Unit  holders  receive  the
correct priority  return.  During the year ended December 31, 2002, the "B" unit
holders were entitled to approximately $95,000 (approximately $1.26 per "B" Unit
and approximately $0.99 per "A" Unit) in distributions.  This amount was paid to
the "A" unit holders to reduce the overpayment.

Future cash  distributions  will depend on the levels of net cash generated from
operations,   the  availability  of  cash  reserves,  and  the  timing  of  debt
maturities,   refinancings,   and/or  property  sales.  The  Partnership's  cash
available  for  distribution  is  reviewed on a monthly  basis.  There can be no
assurance,  however,  that the Partnership  will generate  sufficient funds from
operations  after required capital  expenditures to permit  distributions to its
partners  in  2003  or  subsequent   periods.   See  "Item  2.   Description  of
Properties-Capital Improvements" for information relating to anticipated capital
expenditures at the properties.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 62,627 "A" and 39,384 "B" Units of
Depository Receipts ("Units") in the Partnership  representing 65.04% and 52.41%
of the  outstanding  "A" and "B" Units,  respectively,  at December  31, 2002. A
number of these units were  acquired  pursuant to tender offers made by AIMCO or
its  affiliates.  It is  possible  that  AIMCO or its  affiliates  will  acquire
additional Units of limited partnership  interest in the Partnership in exchange
for cash or a  combination  of cash and units in the  operating  partnership  of
AIMCO either through private  purchases or tender offers.  Under the Partnership
Agreement,  units  holders  holding a majority of the Units are entitled to take
action  with  respect to a variety  of matters  which  would  include  voting on
certain amendments to the Partnership Agreement and voting to remove the General
Partner.  As a result of its  ownership of 65.04% and 52.41% of the  outstanding
"A" and "B"  Units,  respectively,  AIMCO is in a position  to control  all such
voting  decisions with respect to the  Registrant.  Although the General Partner
owes fiduciary duties to the limited  partners of the  Partnership,  the General
Partner  also  owes  fiduciary  duties  to AIMCO as its sole  stockholder.  As a
result,  the  duties  of  the  General  Partner,  as  general  partner,  to  the
Partnership  and its limited  partners may come into conflict with the duties of
the General Partner to AIMCO, as its sole stockholder.

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

This item should be read in conjunction with the financial  statements and other
items contained elsewhere in this report.

Results of Operations

The  Partnership  had net  income of  approximately  $82,000  for the year ended
December  31,  2002 as  compared  to  approximately  $77,000  for the year ended
December 31, 2001.  The  increase in net income is primarily  attributable  to a
decrease in total expenses partially offset by a decrease in total revenues.

Total expenses decreased primarily due to decreases in operating and general and
administrative  expenses  and a loss  on  early  extinguishment  of debt in 2001
partially offset by an increase in interest  expense.  The decrease in operating
expense  was  primarily  due  to  decreases  in  property,   administrative  and
maintenance  expenses.  Property expenses  decreased due to decreases in utility
expense at Hunt Club Apartments and salary and related benefit  expenses at both
of the  Partnership's  properties,  partially  offset by increased  utilities at
Shadow Brook Apartments.  Administrative  expenses decreased due to decreases in
sales and use tax at Shadow Brook  Apartments  and contract  cleaning at both of
the Partnership's properties.  Maintenance expense decreased due to decreases in
floor covering  repair at Shadow Brook  Apartments and snow removal  expenses at
both of the Partnership's  properties  partially offset by increases in contract
labor at both of the Partnership's properties.  The loss on early extinguishment
of debt  recognized  during  the year ended  December  31,  2001  related to the
refinancing of the mortgage encumbering Shadow Brook Apartments.  See "Liquidity
and Capital  Resources"  for  further  discussion.  General  and  administrative
expenses  decreased  primarily due to decreases in  professional  fees,  reduced
Partnership  management  fees on operating  distributions,  and reduced costs of
services  included in the management  reimbursements  to the General  Partner as
allowed  under  the  Partnership   Agreement.   Also  included  in  general  and
administrative  expenses at both December 31, 2002 and 2001 are costs associated
with the  quarterly and annual  communications  with  investors  and  regulatory
agencies and the annual audit required by the  Partnership  Agreement.  Interest
expense  increased due to the  refinancing  of the mortgage  encumbering  Shadow
Brook  Apartments  during August 2001,  which  increased the debt balance at the
property.

Total  revenues  decreased due to decreased  rental income  partially  offset by
increased other income.  Rental income  decreased due to decreased  occupancy at
Shadow Brook Apartments, decreased average rental rates at Hunt Club Apartments,
and increased bad debt expenses at both of the Partnership's  properties.  These
decreases were partially  offset by increased  occupancy at Hunt Club Apartments
and  increased  average  rental rates at Shadow Brook  Apartments.  Other income
increased   due  to  increases  in  utility   reimbursements   at  both  of  the
Partnership's  properties and increased lease cancellation fees and late charges
at Hunt Club  Apartments.  These  increases  were  partially  offset by  reduced
interest  income due to lower  average  cash  balances  maintained  in  interest
bearing accounts.

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

Liquidity and Capital Resources

At  December  31,  2002,  the  Partnership  had  cash and  cash  equivalents  of
approximately  $219,000 as compared to  approximately  $342,000 at December  31,
2001. Cash and cash equivalents decreased  approximately  $123,000 from December
31, 2001 due to approximately  $992,000 of cash used in financing activities and
approximately $60,000 of cash used in investing activities,  partially offset by
approximately  $929,000 of cash provided by operating  activities.  Cash used in
financing  activities  consisted of  distributions  to partners and, to a lesser
extent,  of  payments  of  principal  made  on  the  mortgages  encumbering  the
Partnership's  properties.  Cash  used  in  investing  activities  consisted  of
property improvements and replacements  partially offset by net withdrawals from
restricted escrows  maintained by the mortgage lender.  The Partnership  invests
its working capital reserves in interest bearing accounts.

On August 31, 2001, the Partnership  refinanced the mortgage  encumbering Shadow
Brook Apartments. The refinancing replaced indebtedness of $6,000,000 with a new
mortgage of $8,775,000. The new mortgage carries a stated interest rate of 7.10%
as  compared to the 7.33%  interest  rate on the old  mortgage.  Payments on the
mortgage  loan are due monthly  until the loan  matures on  September 1, 2021 at
which time the loan will be fully amortized.  Total  capitalized loan costs were
approximately  $281,000 during the year ended December 31, 2001. The Partnership
recognized a loss on the early  extinguishment of debt of approximately  $47,000
due to the write-off of unamortized loan costs.

Effective  April  1,  2002,  the  Partnership  adopted  Statement  of  Financial
Accounting  Standards ("SFAS") No. 145, "Rescission of FASB Statements No. 4, 44
and 64". SFAS No. 4 "Reporting  Gains and Losses from  Extinguishment  of Debt,"
required  that all gains and losses from  extinguishments  of debt be aggregated
and, if material,  classified as an  extraordinary  item.  SFAS No. 145 rescinds
SFAS No. 4, and  accordingly,  gains and  losses  from  extinguishments  of debt
should only be  classified  as  extraordinary  if they are unusual in nature and
occur infrequently.  Neither of these criteria applies to the Partnership.  As a
result, the accompanying consolidated statement of operations for the year ended
December 31, 2001 has been restated to reflect the loss on early  extinguishment
of debt at Shadow Brook Apartments of approximately $47,000 in operations rather
than as an extraordinary item.

The sufficiency of existing  liquid assets to meet future  liquidity and capital
expenditure   requirements   is  directly   related  to  the  level  of  capital
expenditures  required at the  properties  to  adequately  maintain the physical
assets and other  operating needs of the Partnership and to comply with Federal,
state, and local legal and regulatory requirements. The General Partner monitors
developments in the area of legal and regulatory  compliance and is studying new
federal laws,  including the  Sarbanes-Oxley Act of 2002. The Sarbanes-Oxley Act
of 2002  mandates  or suggests  additional  compliance  measures  with regard to
governance,  disclosure,  audit and other areas. In light of these changes,  the
Partnership  expects that it will incur higher  expenses  related to compliance,
including   increased  legal  and  audit  fees.  The  Partnership  is  currently
evaluating the capital improvement needs of the properties for the upcoming year
and currently expects to budget approximately $150,000.  Additional improvements
may be considered  and will depend on the physical  condition of the property as
well  as  replacement  reserves  and  anticipated  cash  flow  generated  by the
properties. The additional capital expenditures will be incurred only if cash is
available from operations or from Partnership  reserves. To the extent that such
budgeted capital  improvements are completed,  the  Partnership's  distributable
cash flow, if any, may be adversely affected at least in the short term.

The  Partnership's  assets are thought to be sufficient for any near-term  needs
(exclusive  of  capital   improvements)   of  the   Partnership.   The  mortgage
indebtedness of approximately $12,221,000 is amortized over 20 years and matures
September 1, 2020 and September 1, 2021 at which time the loans are scheduled to
be fully amortized.

Upon distribution of sale proceeds from the sale of Carlin Manor during the year
ended  December  31,  2000,  the "A" Unit  holders  did not  receive the correct
priority  return.  As a result,  at December  31, 2002 the "B" Unit holders have
received excess distributions of approximately $1,328,000  (approximately $17.67
per "B" Unit).  Approximately  $1,303,000  of this amount is due to the "A" Unit
holders  (approximately $13.53 per "A" Unit) and approximately $25,000 is due to
the General Partner.  All future  distributions  payable to the "B" Unit holders
will be paid to the "A" Unit  holders  until the "A" Unit  holders  receive  the
correct priority  return.  During the year ended December 31, 2002, the "B" unit
holders were entitled to approximately $95,000 (approximately $1.26 per "B" Unit
and approximately $0.99 per "A" Unit) in distributions.  This amount was paid to
the "A" unit holders to reduce the overpayment.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 62,627 "A" and 39,384 "B" Units of
Depository Receipts ("Units") in the Partnership  representing 65.04% and 52.41%
of the  outstanding  "A" and "B" Units,  respectively,  at December  31, 2002. A
number of these units were  acquired  pursuant to tender offers made by AIMCO or
its  affiliates.  It is  possible  that  AIMCO or its  affiliates  will  acquire
additional Units of limited partnership  interest in the Partnership in exchange
for cash or a  combination  of cash and units in the  operating  partnership  of
AIMCO either through private  purchases or tender offers.  Under the Partnership
Agreement,  units  holders  holding a majority of the Units are entitled to take
action  with  respect to a variety  of matters  which  would  include  voting on
certain amendments to the Partnership Agreement and voting to remove the General
Partner.  As a result of its  ownership of 65.04% and 52.41% of the  outstanding
"A" and "B"  Units,  respectively,  AIMCO is in a position  to control  all such
voting  decisions with respect to the  Registrant.  Although the General Partner
owes fiduciary duties to the limited  partners of the  Partnership,  the General
Partner  also  owes  fiduciary  duties  to AIMCO as its sole  stockholder.  As a
result,  the  duties  of  the  General  Partner,  as  general  partner,  to  the
Partnership  and its limited  partners may come into conflict with the duties of
the General Partner to AIMCO, as its sole stockholder.

Critical Accounting Policies and Estimates

A summary of the Partnership's  significant  accounting  policies is included in
"Note A - Organization and Significant Accounting Policies" which is included in
the consolidated  financial  statements in "Item 7. Financial  Statements".  The
General  Partner  believes that the  consistent  application  of these  policies
enables the  Partnership  to provide  readers of the financial  statements  with
useful and reliable  information about the  Partnership's  operating results and
financial  condition.  The preparation of consolidated  financial  statements in
conformity with accounting  principles  generally  accepted in the United States
requires the Partnership to make estimates and assumptions.  These estimates and
assumptions affect the reported amounts of assets and liabilities at the date of
the financial  statements  as well as reported  amounts of revenues and expenses
during the reporting  period.  Actual results could differ from these estimates.
Judgments  and  assessments  of  uncertainties  are  required  in  applying  the
Partnership's  accounting policies in many areas. The Partnership  believes that
of its  significant  accounting  policies,  the  following  may involve a higher
degree of judgment and complexity.

Impairment of Long-Lived Assets

Investment  properties  are  recorded at cost,  less  accumulated  depreciation,
unless  considered  impaired.  If  events  or  circumstances  indicate  that the
carrying  amount of a property may be  impaired,  the  Partnership  will make an
assessment of its  recoverability  by estimating  the  undiscounted  future cash
flows,  excluding  interest  charges,  of the property.  If the carrying  amount
exceeds the aggregate  future cash flows,  the  Partnership  would  recognize an
impairment  loss to the extent the carrying amount exceeds the fair value of the
property.

Real  property  investments  are  subject  to varying  degrees of risk.  Several
factors  may  adversely  affect  the  economic  performance  and  value  of  the
Partnership's  investment  properties.  These  factors  include  changes  in the
national,  regional and local economic  climate;  local  conditions,  such as an
oversupply  of  multifamily   properties;   competition   from  other  available
multifamily  property  owners and changes in market  rental  rates.  Any adverse
changes in these factors could cause an impairment in the Partnership's assets.

Revenue Recognition

The Partnership generally leases apartment units for twelve-month terms or less.
Rental income  attributable to leases is recognized  monthly as it is earned and
the  Partnership  fully  reserves all  balances  outstanding  over 30 days.  The
Partnership will offer rental concessions during  particularly slow months or in
response  to  heavy  competition  from  other  similar  complexes  in the  area.
Concessions are charged to income as incurred.



Item 7.     Financial Statements

MULTI-BENEFIT REALTY FUND '87-1

LIST OF CONSOLIDATED FINANCIAL STATEMENTS

      Report of Ernst & Young LLP, Independent Auditors

      Consolidated Balance Sheet - December 31, 2002

      Consolidated Statements of Operations - Years ended December 31, 2002 and
         2001

      Consolidated  Statements of Changes in Partners' (Deficit) Capital - Years
      ended December 31, 2002 and 2001

      Consolidated  Statements of Cash Flows - Years ended December 31, 2002 and
        2001

      Notes to Consolidated Financial Statements

                     Report of Ernst & Young LLP, Independent Auditors



The Partners
Multi-Benefit Realty Fund '87-1


We have audited the  accompanying  consolidated  balance sheet of  Multi-Benefit
Realty  Fund  '87-1  as of  December  31,  2002,  and the  related  consolidated
statements of operations, changes in partners' (deficit) capital, and cash flows
for each of the two years in the period ended December 31, 2002. These financial
statements  are  the  responsibility  of  the  Partnership's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the  consolidated  financial  position of Multi-Benefit
Realty Fund '87-1 at December  31,  2002,  and the  consolidated  results of its
operations  and its cash  flows  for each of the two years in the  period  ended
December 31, 2002, in conformity with accounting  principles  generally accepted
in the United States.

As discussed in Note A to the  consolidated  financial  statements,  in 2002 the
Partnership  adopted  Statement  of  Financial  Accounting  Standards  No.  145,
"Rescission of FASB Statements No. 4, 44 and 64." As a result,  the accompanying
consolidated  financial  statements  for  2001,  referred  to  above,  have been
restated  to conform to the  presentation  adopted  in 2002 in  accordance  with
accounting principles generally accepted in the United States.


                                                            /s/ERNST & YOUNG LLP


Greenville, South Carolina
February 14, 2003

                         MULTI-BENEFIT REALTY FUND '87-1

                           CONSOLIDATED BALANCE SHEET
                        (in thousands, except unit data)

                                December 31, 2002

<TABLE>
<CAPTION>


Assets
<S>                                                                          <C>
   Cash and cash equivalents                                                 $ 219
   Receivables and deposits                                                      170
   Other assets                                                                  421
   Investment properties (Notes B and E):
      Land                                                    $ 1,447
      Buildings and related personal property                   17,856
                                                                19,303
      Less accumulated depreciation                            (11,403)        7,900
                                                                            $ 8,710

Liabilities and Partners' (Deficit) Capital
Liabilities
      Accounts payable                                                        $ 36
      Tenant security deposit liabilities                                         63
      Accrued property taxes                                                     162
      Other liabilities                                                          221
      Mortgage notes payable (Note B)                                         12,221

Partners' (Deficit) Capital
   General Partner                                             $ (131)
   Limited Partner "A" Unit holders -
      96,284 units issued and outstanding                       (8,033)
   Limited Partner "B" Unit holders -
      75,152 units issued and outstanding                        4,171        (3,993)
                                                                            $ 8,710

                See Accompanying Notes to Consolidated Financial Statements

</TABLE>

                         MULTI-BENEFIT REALTY FUND '87-1

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                      (in thousands, except per unit data)


                                                     Years Ended December 31,
                                                     2002                2001
                                                                      (Restated)
Revenues:
  Rental income                                     $ 3,394             $ 3,537
  Other income                                          386                 323
      Total revenues                                  3,780               3,860

Expenses:
  Operating                                           1,411               1,502
  General and administrative                            224                 295
  Depreciation                                          848                 840
  Interest                                              945                 847
  Property taxes                                        270                 252
  Loss on early extinguishment
    of debt (Note B)                                     --                  47
      Total expenses                                  3,698               3,783

Net income (Note C)                                  $ 82                  $ 77


Net income allocated to general
  partner (1%)                                        $ 1                 $ 1
Net income allocated to
  limited partners (99%)                                 81                  76

                                                     $ 82                $ 77

Net income per limited
  partnership unit                                   $ .47               $ .45

Distributions per limited
  partnership "A" units                             $ 7.11              $ 28.76
Distributions per limited
  partnership "B" units                              $ --               $ 8.24

                See Accompanying Notes to Consolidated Financial Statements


                         MULTI-BENEFIT REALTY FUND '87-1

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


<TABLE>
<CAPTION>

                                                                              Total
                                                                            Partners'
                                        General       Limited Partners      (Deficit)
                                        Partner    "A" Units    "B" Units    Capital

<S>                                       <C>       <C>          <C>        <C>
Original capital contributions            $ 1       $ 9,706      $ 7,538    $ 17,245

Limited partnership units at
  December 31, 2002 and
  December 31, 2001                         --       96,284       75,152     171,436

Partners' (deficit) capital at
  December 31, 2000                     $ (117)     $(4,667)     $ 4,721      $ (63)

Distributions to partners                   (9)      (2,769)        (619)     (3,397)

Net income for the year ended
  December 31, 2001                          1           43           33          77

Partners' (deficit) capital at
  December 31, 2001                       (125)      (7,393)       4,135      (3,383)

Distributions to partners                   (7)        (685)          --        (692)

Net income for the year ended
  December 31, 2002                          1           45           36          82

Partners' (deficit) capital at
  December 31, 2002                     $ (131)     $(8,033)      $4,171    $ (3,993)


                See Accompanying Notes to Consolidated Financial Statements
</TABLE>



                         MULTI-BENEFIT REALTY FUND '87-1

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)

<TABLE>
<CAPTION>


                                                              Years Ended December 31,
                                                                  2002        2001
Cash flows from operating activities:
<S>                                                               <C>         <C>
  Net income                                                      $ 82        $ 77
  Adjustments to reconcile net income to net cash provided
   by operating activities:
     Depreciation                                                   848          840
     Amortization of loan costs                                      27           35
     Loss on early extinguishment of debt                            --           47
     Change in accounts:
      Receivables and deposits                                       (8)         (77)
      Other assets                                                    8           (4)
      Accounts payable                                              (51)          20
      Tenant security deposit liabilities                            13           (8)
      Accrued property taxes                                          9            1
      Other liabilities                                               1          (57)
          Net cash provided by operating activities                 929          874

Cash flows from investing activities:
  Property improvements and replacements                           (172)        (556)
  Net withdrawals from restricted escrows                           112          169
          Net cash used in investing activities                     (60)        (387)


Cash flows from financing activities:
  Payments on mortgage notes payable                               (300)        (134)
  Repayment of mortgage note payable                                 --       (6,000)
  Proceeds from mortgage note payable                                --        8,775
  Loan costs paid                                                    --         (281)
  Distributions to partners                                        (692)      (3,397)
          Net cash used in financing activities                    (992)      (1,037)

Net decrease in cash and cash equivalents                          (123)        (550)
Cash and cash equivalents at beginning of year                      342          892
Cash and cash equivalents at end of year                         $ 219        $ 342

Supplemental disclosure of cash flow information:
  Cash paid for interest                                         $ 915        $ 796


                See Accompanying Notes to Consolidated Financial Statements
</TABLE>


                         MULTI-BENEFIT REALTY FUND '87-1

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                December 31, 2002


Note A - Organization and Significant Accounting Policies

Organization

Multi-Benefit   Realty  Fund  '87-1  (the  "Partnership"  or  "Registrant")  was
organized  as a limited  partnership  under the laws of the State of  California
pursuant to a Certificate and Agreement of Limited  Partnership  filed September
8, 1986.  The  Partnership  commenced  operations  on  February  27,  1987.  The
Partnership operates two apartment  properties,  one each located in Indiana and
Utah. ConCap Equities,  Inc. ("CEI" or the "General Partner") is a subsidiary of
Apartment  Investment and Management Company  ("AIMCO"),  a publicly traded real
estate  investment  trust. The director and officers of the General Partner also
serve as executive  officers of AIMCO. The Partnership  Agreement  provides that
the Partnership is to terminate on December 31, 2036, unless terminated prior to
such date.

Upon  the  Partnership's   formation  in  1986,  Consolidated  Capital  Equities
Corporation  ("CCEC"), a Colorado  corporation,  was the sole general partner of
the Partnership and the corporate limited partner, a wholly-owned  subsidiary of
CCEC, was the sole limited partner.  In 1988,  through a series of transactions,
Southmark Corporation  ("Southmark") acquired a controlling interest in CCEC. In
December  1988,  CCEC filed for  reorganization  under  Chapter 11 of the United
States  Bankruptcy  Code. In 1990, as part of CCEC's  reorganization  plan,  CEI
acquired  CCEC's general  partner  interest in the  Partnership  and in 15 other
affiliated public limited partnerships (the "Affiliated Partnerships"), acquired
the stock of the  corporate  limited  partner,  and CEI replaced CCEC as General
Partner in all 16 partnerships. The selection of CEI as the sole General Partner
was  approved by a majority of the Unit  holders in the  Partnership  and of the
limited  partners  in  each  of  the  Affiliated   Partnerships  pursuant  to  a
solicitation  of the  Unit  holders  dated  August  10,  1990.  As  part of this
solicitation,  the Unit  holders also  approved an amendment to the  Partnership
Agreement to limit changes of control of the Partnership.

Principles of Consolidation

The consolidated financial statements of the Partnership include its 99% limited
partnership  interest in Hunt Club Associates,  Ltd. The general partner of Hunt
Club  Associates,  Ltd. is the General  Partner.  The Partnership may remove the
general partner of Hunt Club  Associates,  Ltd;  therefore,  this partnership is
controlled and consolidated by the Partnership. All significant interpartnership
balances have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  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.

Partners' (Deficit) Capital

The  Partnership  has  issued  two  classes  of  Units  of  Depositary  Receipts
("Units"),  "A" Units and "B" Units.  The two  classes of Units are  entitled to
different  rights  and  priorities  as to  cash  distributions  and  partnership
allocations.  The Units represent  economic  rights  attributable to the limited
partnership  interests in the Partnership and entitle the holders thereof ("Unit
holders") to participate in certain allocations of the Partnership.

The  Partnership  Agreement  provides for the  allocation  of net income and net
losses from operations for both financial and tax reporting purposes as follows:
net profits are first  allocated in the reverse order of any net losses then are
allocated 99% to the holders of "A" Units until they have been allocated  income
equal to their  priority  return,  and 1% to the General  Partner.  The priority
return  represents 9% per annum return on invested capital for the Partnership's
first  fiscal  year,  9.5% for the  second  year and 10% per  annum  thereafter.
Additional  net profits are  allocated 1% to the General  Partner and 99% to the
Unit holders.  Net losses are allocated 1% to the General Partner and 99% to the
Unit holders until their capital  accounts are depleted.  Additional  net losses
are allocated to the General  Partner.  Net income per limited  partnership unit
for both 2002 and 2001 was  computed  as 99% of net  income  divided  by 171,436
units outstanding.

Distributable  cash from  operations is allocated 1% to the General  Partner and
99% to the Unit holders with holders of "A" Units first receiving their priority
return,  then the balance is split equally  between holders of "A" Units and "B"
Units.  The General Partner  receives 1% of surplus funds and holders of "A" and
"B" Units will receive a return of their invested capital. Any remainder will be
allocated 10% to holders of "A" Units and 90% to holders of "B" Units.

Cash and Cash Equivalents

Includes  cash on hand and in  banks.  At  certain  times,  the  amount  of cash
deposited  at a bank may  exceed the limit on insured  deposits.  Cash  balances
include  approximately  $201,000 at December 31, 2002 that are  maintained by an
affiliated   management  company  on  behalf  of  affiliated  entities  in  cash
concentration accounts.

Tenant Security Deposits

The Partnership  requires security deposits from lessees for the duration of the
lease.  Deposits are refunded when the tenant  vacates,  provided the tenant has
not damaged their space and is current on rental payments.

Investment Properties

Investment properties consist of two apartment complexes and are stated at cost.
Acquisition  fees are  capitalized  as a cost of real  estate.  Expenditures  in
excess of $250 that  maintain an existing  asset which has a useful life of more
than  one  year  are  capitalized  as  capital   replacement   expenditures  and
depreciated  over the  estimated  useful  life of the  asset.  Expenditures  for
ordinary  repairs,  maintenance  and  apartment  turnover  costs are  accrued as
incurred.

In accordance with Statement of Financial Accounting Standards ("SFAS") No. 144,
"Accounting   for  the  Impairment  or  Disposal  of  Long-Lived   Assets,"  the
Partnership  records  impairment  losses on long-lived assets used in operations
when events and circumstances indicate that the assets might be impaired and the
undiscounted  cash flows estimated to be generated by those assets are less than
the carrying  amounts of those assets.  No  adjustments  for impairment of value
were recorded in the years ended December 31, 2002 and 2001.

Depreciation

Depreciation is provided by the straight-line method over the estimated lives of
the investment properties and related personal property.  For Federal income tax
purposes, the accelerated cost recovery method is used for real property over 18
years for additions after May 8, 1985 and before January 1, 1987. As a result of
the Tax  Reform  Act of  1986,  for  additions  after  December  31,  1986,  the
alternative  depreciation  system is used for  depreciation of (1) real property
additions over 40 years, and (2) personal property additions over 5-20 years.

Loan Costs

Loan  costs  of  approximately   $442,000  less   accumulated   amortization  of
approximately  $46,000 are included in other  assets and are being  amortized by
the straight-line method over the life of the respective loans.  Amortization of
loan costs is included in interest  expense in the  accompanying  statements  of
operations.  Amortization  expense is expected to be  approximately  $21,000 for
each of the years 2003 through 2007.

Leases

The Partnership generally leases apartment units for twelve-month terms or less.
The  Partnership  recognizes  income as earned on leases and fully  reserves all
balances  outstanding over thirty days. The General Partner's policy is to offer
rental  concessions  during  particularly  slow  months or in  response to heavy
competition  from other similar  complexes in the area.  Concessions are charged
against rental income as incurred.

Segment Reporting

SFAS  No.  131,   "Disclosure  about  Segments  of  an  Enterprise  and  Related
Information"  established standards for the way that public business enterprises
report information about operating  segments in annual financial  statements and
requires that those  enterprises  report  selected  information  about operating
segments in interim financial reports. It also established standards for related
disclosures about products and services,  geographic areas, and major customers.
As defined in SFAS No. 131, the Partnership has only one reportable segment.

Advertising

Advertising  costs of  approximately  $57,000  and  $58,000  for the years ended
December 31, 2002 and 2001, respectively, are charged to expense as incurred and
are included in operating expenses.

Fair Value of Financial Statements

SFAS No.  107,  "Disclosures  about Fair  Value of  Financial  Instruments",  as
amended by SFAS No. 119, "Disclosures about Derivative Financial Instruments and
Fair  Value  of  Financial  Instruments",  requires  disclosure  of  fair  value
information  about  financial  instruments,  whether  or not  recognized  in the
balance sheet, for which it is practicable to estimate fair value. Fair value is
defined in the SFAS as the amount at which the instruments could be exchanged in
a  current  transaction  between  willing  parties,  other  than in a forced  or
liquidation  sale.  The fair value of the  Partnership's  long term debt,  after
discounting  the  scheduled  loan  payments  to  maturity  at the  Partnership's
incremental borrowing rate was approximately $12,769,000 at December 31, 2002.

Recent Accounting Pronouncements

In August 2001, the Financial  Accounting  Standards  Board issued SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived  Assets".  SFAS No. 144
provides  accounting  guidance for  financial  accounting  and reporting for the
impairment or disposal of long-lived  assets.  SFAS No. 144 supersedes  SFAS No.
121,  "Accounting  for the  Impairment of Long-Lived  Assets and for  Long-Lived
Assets to be Disposed Of". SFAS No. 144 is effective for fiscal years  beginning
after December 15, 2001. The Partnership  adopted SFAS 144 effective  January 1,
2002. The adoption did not have a material  effect on the financial  position or
results of operations of the Partnership.

Effective  April  1,  2002,  the  Partnership  adopted  Statement  of  Financial
Accounting  Standards ("SFAS") No. 145, "Rescission of FASB Statements No. 4, 44
and 64". SFAS No. 4 "Reporting  Gains and Losses from  Extinguishment  of Debt,"
required  that all gains and losses from  extinguishment  of debt be  aggregated
and, if material,  classified as an  extraordinary  item.  SFAS No. 145 rescinds
SFAS No. 4, and accordingly, gains and losses from extinguishment of debt should
only be  classified  as  extraordinary  if they are  unusual in nature and occur
infrequently. Neither of these criteria applies to the Partnership. As a result,
the  accompanying  consolidated  statement  of  operations  for the  year  ended
December 31, 2001 has been restated to reflect the loss on early  extinguishment
of debt at Shadow Brook Apartments of approximately $47,000 in operations rather
than as an extraordinary item.

Note B - Mortgage Notes Payable

The principle terms of mortgage notes payable are as follows:

<TABLE>
<CAPTION>

                        Principal      Monthly                           Principal
                       Balance At      Payment    Stated                  Balance
                      December 31,    Including  Interest   Maturity       Due At
Property                  2002        Interest     Rate       Date        Maturity
                           (in thousands)                              (in thousands)
Hunt Club
<S>                      <C>            <C>        <C>      <C>   <C>       <C>
  1st mortgage           $ 3,706        $ 33       8.05%    09/01/20        $ --
Shadow Brook
  1st mortgage             8,515           69      7.10%    09/01/21           --

                         $12,221        $ 102                               $ --
</TABLE>


The mortgage  notes  payable are  non-recourse  and are secured by pledge of the
respective  apartment  properties  and by pledge of revenues from the respective
apartment  properties.  Both of the notes require prepayment penalties if repaid
prior to maturity  and  prohibit  resale of the  properties  subject to existing
indebtedness.

On August 31, 2001, the Partnership  refinanced the mortgage  encumbering Shadow
Brook Apartments. The refinancing replaced indebtedness of $6,000,000 with a new
mortgage of $8,775,000. The new mortgage carries a stated interest rate of 7.10%
as  compared to the 7.33%  interest  rate on the old  mortgage.  Payments on the
mortgage  loan are due monthly  until the loan  matures on  September 1, 2021 at
which time the loan will be fully amortized.  Total  capitalized loan costs were
approximately  $281,000 during the year ended December 31, 2001. The Partnership
recognized a loss on the early  extinguishment of debt of approximately  $47,000
due to the write-off of unamortized loan costs.

Scheduled  principal  payments  of the  mortgage  notes  payable  subsequent  to
December 31, 2002 are as follows (in thousands):

                               2003                 324
                               2004                 348
                               2005                 375
                               2006                 404
                               2007                 434
                            Thereafter           10,336
                                                $12,221

Note C - Income Taxes

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

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

                                              2002          2001
Net income as reported                        $ 82          $ 77
Add (deduct)
  Depreciation differences                        52            38
  Unearned income                                 (3)           70
  Gain on sale of investment property             --            96
  Other                                         (116)          (77)
Federal taxable income                        $ 15          $ 204
Federal taxable income per limited
  partnership unit                            $ .09        $ 1.18


The following is a reconciliation between the Partnership's reported amounts and
Federal tax basis of net assets and  liabilities  (in  thousands) as of December
31, 2002:

Net liabilities as reported                  $ (3,993)
Land and buildings                                314
Accumulated depreciation                          824
Syndication fees                                1,975
Other                                             117

Net assets - tax basis                        $ (763)

Note D - Transactions with Affiliated Parties

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

During the years ended  December  31, 2002 and 2001,  affiliates  of the General
Partner  were  entitled  to  receive  5% of  gross  receipts  from  both  of the
Partnership's  properties  as  compensation  for providing  property  management
services.  The Partnership  paid to such affiliates  approximately  $187,000 and
$198,000 for the years ended December 31, 2002 and 2001, respectively,  which is
included in operating expenses.

An affiliate  of the General  Partner  received  reimbursements  of  accountable
administrative expenses amounting to approximately $101,000 and $357,000 for the
years  ended  December  31,  2002 and 2001,  respectively,  which is included in
general and administrative expenses and investment properties. Included in these
amounts are fees  related to  construction  management  services  provided by an
affiliate of the General Partner of approximately $4,000 and $174,000 during the
years ended  December 31, 2002 and 2001,  respectively.  The fees are calculated
based on a percentage of current year additions to investment properties.

The Partnership  Agreement  provides for a fee equal to 9% of distributable cash
from  operations  (as  defined in the  Partnership  Agreement)  received  by the
limited   partners  to  be  paid  to  the  General  Partner  for  executive  and
administrative  management services.  Fees of approximately  $62,000 and $82,000
were paid for the years  ended  December  31,  2002 and 2001,  respectively,  in
association   with  the   distributions   and  are   included   in  general  and
administrative expenses.

An affiliate of the General Partner received  approximately $88,000 for services
provided in conjunction with the refinancing of the mortgage  encumbering Shadow
Brook Apartments in August 2001 (see "Note B"). This cost was capitalized and is
included in other assets on the consolidated balance sheet.

Beginning in 2001, the  Partnership  began insuring its properties up to certain
limits through coverage provided by AIMCO which is generally  self-insured for a
portion of losses and  liabilities  related  to workers  compensation,  property
casualty and vehicle liability. The Partnership insures its properties above the
AIMCO  limits  through  insurance  policies  obtained  by  AIMCO  from  insurers
unaffiliated with the General Partner.  During the years ended December 31, 2002
and 2001, the Partnership was charged by AIMCO and its affiliates  approximately
$50,000 and $36,000,  respectively,  for insurance  coverage and fees associated
with policy claims administration.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 62,627 "A" and 39,384 "B" Units of
Depository Receipts ("Units") in the Partnership  representing 65.04% and 52.41%
of the  outstanding  "A" and "B" Units,  respectively,  at December  31, 2002. A
number of these units were  acquired  pursuant to tender offers made by AIMCO or
its  affiliates.  It is  possible  that  AIMCO or its  affiliates  will  acquire
additional Units of limited partnership  interest in the Partnership in exchange
for cash or a  combination  of cash and units in the  operating  partnership  of
AIMCO either through private  purchases or tender offers.  Under the Partnership
Agreement,  units  holders  holding a majority of the Units are entitled to take
action  with  respect to a variety  of matters  which  would  include  voting on
certain amendments to the Partnership Agreement and voting to remove the General
Partner.  As a result of its  ownership of 65.04% and 52.41% of the  outstanding
"A" and "B"  Units,  respectively,  AIMCO is in a position  to control  all such
voting  decisions with respect to the  Registrant.  Although the General Partner
owes fiduciary duties to the limited  partners of the  Partnership,  the General
Partner  also  owes  fiduciary  duties  to AIMCO as its sole  stockholder.  As a
result,  the  duties  of  the  General  Partner,  as  general  partner,  to  the
Partnership  and its limited  partners may come into conflict with the duties of
the General Partner to AIMCO, as its sole stockholder.

Note E - Real Estate and Accumulated Depreciation


<TABLE>
<CAPTION>

                                                  Initial Cost
                                                 To Partnership
                                                 (in thousands)
                                                         Buildings       Net Cost
                                                        and Related     Capitalized
                                                         Personal      Subsequent to
Description                  Encumbrances      Land      Property       Acquisition
                            (in thousands)                            (in thousands)
<S>                            <C>            <C>         <C>             <C>
Hunt Club Apartments           $ 3,706        $ 485       $ 5,673         $ 1,779
Shadow Brook Apartments          8,515           962        8,262           2,142

          Totals               $12,221       $ 1,447      $13,935         $ 3,921
</TABLE>


                 Gross Amount At Which
                        Carried
                  At December 31, 2002
                    (in thousands)

<TABLE>
<CAPTION>

                       Buildings
                      And Related
                       Personal             Accumulated     Date of      Date    Depreciable
Description    Land    Property    Total    Depreciation  Construction Acquired  Life-Years
                                           (in thousands)
<S>            <C>      <C>       <C>         <C>             <C>        <C>        <C>
Hunt Club      $ 485    $ 7,452   $ 7,937     $ 5,243         1979       05/87      5-30
Shadow Brook     962     10,404    11,366       6,160         1985       05/87      5-30

Totals        $1,447    $17,856   $19,303     $11,403
</TABLE>


Reconciliation of "real estate and accumulated depreciation"

                                              Years Ended December 31,
                                                 2002          2001
                                                   (in thousands)
Real Estate
Balance at beginning of year                    $19,131       $18,700
  Property improvements                             172           431
Balance at end of year                          $19,303       $19,131

Accumulated Depreciation
Balance at beginning of year                    $10,555       $ 9,715
  Additions charged to expense                      848           840
Balance at end of year                          $11,403       $10,555

The  aggregate  cost of the real  estate  for  Federal  income tax  purposes  at
December  31,  2002 and 2001,  is  approximately  $19,617,000  and  $19,445,000,
respectively. The accumulated depreciation taken for Federal income tax purposes
at December 31, 2002 and 2001,  is  approximately  $10,579,000  and  $9,783,000,
respectively.

Note F - Distributions

Upon distribution of sale proceeds from the sale of Carlin Manor during the year
ended  December  31,  2000,  the "A" Unit  holders  did not  receive the correct
priority  return.  As a result,  at December  31, 2002 the "B" Unit holders have
received excess distributions of approximately $1,328,000  (approximately $17.67
per "B" Unit).  Approximately  $1,303,000  of this amount is due to the "A" Unit
holders  (approximately $13.53 per "A" Unit) and approximately $25,000 is due to
the General Partner.  All future  distributions  payable to the "B" Unit holders
will be paid to the "A" Unit  holders  until the "A" Unit  holders  receive  the
correct priority  return.  During the year ended December 31, 2002, the "B" unit
holders were entitled to approximately $95,000 (approximately $1.26 per "B" Unit
and approximately $0.99 per "A" Unit) in distributions.  This amount was paid to
the "A" unit holders to reduce the overpayment.

Note G - Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the Partnership,  its General Partner and several of
their  affiliated  partnerships and corporate  entities.  The action purports to
assert  claims on behalf of a class of  limited  partners  and  derivatively  on
behalf of a number of limited partnerships (including the Partnership) which are
named as nominal defendants, challenging, among other things, the acquisition of
interests in certain General Partner entities by Insignia  Financial Group, Inc.
("Insignia") and entities which were, at one time, affiliates of Insignia;  past
tender offers by the Insignia  affiliates to acquire limited  partnership units;
management of the  partnerships  by the Insignia  affiliates;  and the series of
transactions  which  closed on October 1, 1998 and  February  26,  1999  whereby
Insignia and Insignia  Properties Trust,  respectively,  were merged into AIMCO.
The plaintiffs seek monetary damages and equitable  relief,  including  judicial
dissolution of the  Partnership.  On June 25, 1998, the General  Partner filed a
motion seeking dismissal of the action. In lieu of responding to the motion, the
plaintiffs  filed an amended  complaint.  The General Partner filed demurrers to
the amended complaint which were heard February 1999.

Pending the ruling on such  demurrers,  settlement  negotiations  commenced.  On
November 2, 1999,  the parties  executed and filed a Stipulation  of Settlement,
settling claims, subject to court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  at which time
the Court set a final  approval  hearing for  December  10,  1999.  Prior to the
December  10,  1999  hearing,  the  Court  received  various  objections  to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement.  On
December  14,  1999,  the General  Partner  and its  affiliates  terminated  the
proposed settlement.  In February 2000, counsel for some of the named plaintiffs
filed a motion to disqualify plaintiff's lead and liaison counsel who negotiated
the settlement.  On June 27, 2000, the Court entered an order disqualifying them
from the case and an appeal was taken  from the order on  October  5,  2000.  On
December 4, 2000, the Court  appointed the law firm of Lieff Cabraser  Heimann &
Bernstein  LLP as new  lead  counsel  for  plaintiffs  and the  putative  class.
Plaintiffs  filed a third  amended  complaint on January 19,  2001.  On March 2,
2001,  the  General  Partner  and its  affiliates  filed a demurrer to the third
amended  complaint.  On May 14, 2001,  the Court heard the demurrer to the third
amended  complaint.  On July 10,  2001,  the Court  issued  an order  sustaining
defendants'  demurrer on certain grounds.  On July 20, 2001,  Plaintiffs filed a
motion for  reconsideration  of the Court's July 10, 2001 order granting in part
and denying in part defendants' demurrer. On September 7, 2001, Plaintiffs filed
a fourth amended class and derivative action  complaint.  On September 12, 2001,
the Court denied Plaintiffs' motion for reconsideration. On October 5, 2001, the
General Partner and affiliated defendants filed a demurrer to the fourth amended
complaint,  which was heard on December 11, 2001. On February 2, 2002, the Court
served its order granting in part the demurrer.  The Court has dismissed without
leave  to amend  certain  of the  plaintiffs'  claims.  On  February  11,  2002,
plaintiffs  filed a motion seeking to certify a putative class  comprised of all
non-affiliated  persons  who own or have owned  units in the  partnerships.  The
General Partner and affiliated  defendants oppose the motion. On April 29, 2002,
the Court held a hearing on plaintiffs' motion for class  certification and took
the matter under submission after further briefing, as ordered by the court, was
submitted by the parties.  On July 10, 2002, the Court entered an order vacating
the  current  trial  date of  January  13,  2003 (as well as the  pre-trial  and
discovery cut-off dates) and stayed the case in its entirety through November 7,
2002 so that the parties could have an  opportunity  to discuss  settlement.  On
October  30,  2002,  the court  entered  an order  extending  the stay in effect
through January 10, 2003.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action described below. The Court
has  scheduled  the hearing on  preliminary  approval  for April 4, 2003 and the
hearing on final approval for June 2, 2003.

In general  terms,  the  proposed  settlement  provides  for  certification  for
settlement  purposes of a settlement class consisting of all limited partners in
this  Partnership and others (the  "Partnerships")  as of December 20, 2002, the
dismissal  with  prejudice  and  release  of claims  in the  Nuanes  and  Heller
litigation,  payment by AIMCO of $9.9  million  (which shall be  distributed  to
settlement  class  members  after  deduction of attorney fees and costs of class
counsel and certain costs of  settlement)  and up to $ 1 million toward the cost
of independent  appraisals of the Partnerships'  properties by a Court appointed
appraiser.  An affiliate of the General Partner has also agreed to make a tender
offer to purchase all of the partnership  interests in the  Partnerships  within
one year of final approval,  if it is granted,  and to provide partners with the
independent  appraisals at the time of these  tenders.  The proposed  settlement
also  provides  for the  limitation  of the  allowable  costs  which the General
Partner or its affiliates  will charge the  Partnerships in connection with this
litigation  and  imposes  limits  on the  class  counsel  fees and costs in this
litigation.  If the Court grants preliminary approval of the proposed settlement
in April, a notice will be distributed to partners providing detail on the terms
of the proposed settlement.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the General Partner and affiliated defendants
moved to strike the first  amended  complaint in its entirety for  violating the
Court's  July 10, 2001 order  granting  in part and denying in part  defendants'
demurrer in the Nuanes action, or  alternatively,  to strike certain portions of
the  complaint  based on the statute of  limitations.  Other  defendants  in the
action demurred to the fourth amended complaint,  and,  alternatively,  moved to
strike the  complaint.  On December  11, 2001,  the court heard  argument on the
motions and took the matters under  submission.  On February 4, 2002,  the Court
served  notice of its order  granting  defendants'  motion to strike  the Heller
complaint  as a violation  of its July 10, 2001 order in the Nuanes  action.  On
March 27, 2002, the plaintiffs  filed a notice  appealing the order striking the
complaint.  Before completing briefing on the appeal, the parties stayed further
proceedings  in the  appeal  pending  the  Court's  review  of the  terms of the
proposed settlement described above.

The  General  Partner  does not  anticipate  that any costs to the  Partnership,
whether legal or settlement costs,  associated with these cases will be material
to the Partnership's overall operations.

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

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

            None.

                                    PART III

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

The general partner of Multi-Benefit Realty Fund '87-1 (the "Partnership" or the
"Registrant") is ConCap  Equities,  Inc. ("CEI" or the "General  Partner").  The
names of the director and executive officers of the General Partner,  their ages
and the nature of all positions with CEI presently held by them are as follows:

Name                        Age    Position

Patrick J. Foye              45    Executive Vice President and Director

Paul J. McAuliffe            46    Executive Vice President and Chief
                                     Financial Officer

Thomas C. Novosel            44    Senior Vice President and Chief Accounting
                                     Officer

Patrick J. Foye has been  Executive  Vice  President and Director of the General
Partner since October 1, 1998.  Mr. Foye has served as Executive  Vice President
of AIMCO since May 1998,  where he is responsible  for  continuous  improvement,
acquisitions of partnership securities, consolidation of minority interests, and
corporate and other acquisitions.  Prior to joining AIMCO, Mr. Foye was a Merger
and Acquisitions Partner in the law firm of Skadden, Arps, Slate, Meagher & Flom
LLP from 1989 to 1998.

Paul J. McAuliffe has been Executive Vice President and Chief Financial  Officer
of the  General  Partner  since  April 1,  2002.  Mr.  McAuliffe  has  served as
Executive  Vice  President  of AIMCO  since  February  1999 and Chief  Financial
Officer of AIMCO since  October 1999.  From May 1996 until he joined AIMCO,  Mr.
McAuliffe was Senior Managing Director of Secured Capital Corp.

Thomas C. Novosel has been Senior Vice President and Chief Accounting Officer of
the General  Partner since April 1, 2002.  Mr. Novosel has served as Senior Vice
President and Chief  Accounting  Officer of AIMCO since April 2000. From October
1993  until he joined  AIMCO,  Mr.  Novosel  was a partner at Ernst & Young LLP,
where he  served  as the  director  of real  estate  advisory  services  for the
southern Ohio Valley area offices but did not work on any assignments related to
AIMCO or the Partnership.

One or more of the above persons are also directors and/or officers of a general
partner (or general partner of a general partner) of limited  partnerships which
either have a class of  securities  registered  pursuant to Section 12(g) of the
Securities Exchange Act of 1934, or are subject to the reporting requirements of
Section  15(d) of such Act.  Further,  one or more of the above persons are also
directors and/or officers of Apartment Investment and Management Company and the
general  partner  of  AIMCO  Properties,  L.P.,  entities  that  have a class of
securities  registered  pursuant to Section 12(g) of the Securities Exchange Act
of 1934, or are subject to the reporting  requirements of Section 15 (d) of such
Act.

The  executive  officers  and  director  of  the  General  Partner  fulfill  the
obligations  of the Audit  Committee  and  oversee the  Partnership's  financial
reporting  process on behalf of the General Partner.  Management has the primary
responsibility for the financial  statements and the reporting process including
the systems of internal controls. In fulfilling its oversight  responsibilities,
the executive  officers and director of the General Partner reviewed the audited
financial  statements with management including a discussion of the quality, not
just the  acceptability,  of the accounting  principles,  the  reasonableness of
significant  judgments,   and  the  clarity  of  disclosures  in  the  financial
statements.

The  executive  officers and director of the General  Partner  reviewed with the
independent  auditors,  who are  responsible  for  expressing  an opinion on the
conformity of those audited  financial  statements  with  accounting  principles
generally accepted in the United States,  their judgments as to the quality, not
just the  acceptability,  of the  Partnership's  accounting  principles and such
other  matters as are required to be discussed  with the Audit  Committee or its
equivalent under auditing standards  generally accepted in the United States. In
addition,  the  Partnership  has  discussed  with the  independent  auditors the
auditors' independence from management and the Partnership including the matters
in the written  disclosures  required by the  Independence  Standards  Board and
considered  the   compatibility   of  non-audit   services  with  the  auditors'
independence.

The executive  officers and director of the General  Partner  discussed with the
Partnership's  independent auditors the overall scope and plans for their audit.
In  reliance on the reviews and  discussions  referred to above,  the  executive
officers and director of the General  Partner have approved the inclusion of the
audited financial  statements in the Form 10-KSB for the year ended December 31,
2002 for filing with the Securities and Exchange Commission.

The General Partner has reappointed Ernst & Young LLP as independent auditors to
audit the financial  statements of the  Partnership for 2003. Fees for 2002 were
audit  services of  approximately  $37,000 and non-audit  services  (principally
tax-related) of approximately $18,000.

Item 10.    Executive Compensation

Neither  the  director  nor the  officers of the General  Partner  received  any
remuneration from the Registrant.

Item 11.    Security Ownership of Certain Beneficial Owners and Management

(a)   Security Ownership of Certain Beneficial Owners

      Except as noted  below,  no  person  or entity  was known to CEI to own of
      record or beneficially  more than 5% of the Units of the Partnership as of
      December 31, 2002.

                                               Number of         Percent
                                                 Units           of Total

      AIMCO Properties, LP (1)              33,744 A units        35.04%
         (an affiliate of AIMCO)            20,944 B units        27.87%

      Insignia Properties, LP (2)            2,243 A units        2.33%
         (an affiliate of AIMCO)               210 B units        0.28%

      Madison River Properties, LLC (2)     21,457 A units        22.29%
         (an affiliate of AIMCO)            13,822 B units        18.39%

      Cooper River Properties, LLC (2)       5,183 A units        5.38%
         (an affiliate of AIMCO)             4,408 B units        5.87%

(1)  Entity is indirectly  ultimately  controlled by AIMCO. Its business address
     is 4582 S. Ulster St. Parkway, Suite 1100, Denver, Colorado 80237.

(2)  Entity is indirectly  ultimately owned by AIMCO. Its business address is 55
     Beattie Place, Greenville, SC 29601.

(b)   Beneficial Owners of Management

      As of December 31, 2002,  neither CEI nor any of its directors or officers
      or  associates  of CEI own any  units  of the  Partnership  of  record  or
      beneficially.

(c)   Changes in Control

      Beneficial Owners of CEI

      As of December 31, 2002,  the following  entity was known to CEI to be the
      beneficial owner of more than 5 percent of its common stock:

              Name and address         Number of CEI SHARES   Percent of Total

      Insignia Properties Trust (1)           100,000               100%

(1)  Entity is indirectly  ultimately owned by AIMCO. Its business address is 55
     Beattie Place, Greenville, SC 29601.

Item 12.    Certain Relationships and Related Transactions

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

During the years ended  December  31, 2002 and 2001,  affiliates  of the General
Partner  were  entitled  to  receive  5% of  gross  receipts  from  both  of the
Partnership's  properties  as  compensation  for providing  property  management
services.  The Partnership  paid to such affiliates  approximately  $187,000 and
$198,000 for the years ended December 31, 2002 and 2001, respectively,  which is
included in operating expenses.

An affiliate  of the General  Partner  received  reimbursements  of  accountable
administrative expenses amounting to approximately $101,000 and $357,000 for the
years  ended  December  31,  2002 and 2001,  respectively,  which is included in
general and administrative expenses and investment properties. Included in these
amounts are fees  related to  construction  management  services  provided by an
affiliate of the General Partner of approximately $4,000 and $174,000 during the
years ended  December 31, 2002 and 2001,  respectively.  The fees are calculated
based on a percentage of current year additions to investment properties.

The Partnership  Agreement  provides for a fee equal to 9% of distributable cash
from  operations  (as  defined in the  Partnership  Agreement)  received  by the
limited   partners  to  be  paid  to  the  General  Partner  for  executive  and
administrative  management services.  Fees of approximately  $62,000 and $82,000
were paid for the years  ended  December  31,  2002 and 2001,  respectively,  in
association   with  the   distributions   and  are   included   in  general  and
administrative expenses.

An affiliate of the General Partner received  approximately $88,000 for services
provided in conjunction with the refinancing of the mortgage  encumbering Shadow
Brook  Apartments in August 2001.  This cost was  capitalized and is included in
other assets on the consolidated balance sheet.

Beginning in 2001, the  Partnership  began insuring its properties up to certain
limits through coverage provided by AIMCO which is generally  self-insured for a
portion of losses and  liabilities  related  to workers  compensation,  property
casualty and vehicle liability. The Partnership insures its properties above the
AIMCO  limits  through  insurance  policies  obtained  by  AIMCO  from  insurers
unaffiliated with the General Partner.  During the years ended December 31, 2002
and 2001, the Partnership was charged by AIMCO and its affiliates  approximately
$50,000 and $36,000,  respectively,  for insurance  coverage and fees associated
with policy claims administration.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 62,627 "A" and 39,384 "B" Units of
Depository Receipts ("Units") in the Partnership  representing 65.04% and 52.41%
of the  outstanding  "A" and "B" Units,  respectively,  at December  31, 2002. A
number of these units were  acquired  pursuant to tender offers made by AIMCO or
its  affiliates.  It is  possible  that  AIMCO or its  affiliates  will  acquire
additional Units of limited partnership  interest in the Partnership in exchange
for cash or a  combination  of cash and units in the  operating  partnership  of
AIMCO either through private  purchases or tender offers.  Under the Partnership
Agreement,  units  holders  holding a majority of the Units are entitled to take
action  with  respect to a variety  of matters  which  would  include  voting on
certain amendments to the Partnership Agreement and voting to remove the General
Partner.  As a result of its  ownership of 65.04% and 52.41% of the  outstanding
"A" and "B"  Units,  respectively,  AIMCO is in a position  to control  all such
voting  decisions with respect to the  Registrant.  Although the General Partner
owes fiduciary duties to the limited  partners of the  Partnership,  the General
Partner  also  owes  fiduciary  duties  to AIMCO as its sole  stockholder.  As a
result,  the  duties  of  the  General  Partner,  as  general  partner,  to  the
Partnership  and its limited  partners may come into conflict with the duties of
the General Partner to AIMCO, as its sole stockholder.

Item 13.    Exhibits and Reports on Form 8-K

      (a)   Exhibits:

            See attached Exhibit Index.

      (b) Reports on Form 8-K filed during the fourth  quarter of calendar  year
2002:

            None.

Item 14.    Controls and Procedures

The principal  executive officer and principal  financial officer of the General
Partner, who are the equivalent of the Partnership's principal executive officer
and  principal  financial  officer,  respectively,  have,  within 90 days of the
filing  date  of  this  annual  report,   evaluated  the  effectiveness  of  the
Partnership's  disclosure  controls and  procedures  (as defined in Exchange Act
Rules 13a-14(c) and 15d-14(c)) and have determined that such disclosure controls
and  procedures  are  adequate.  There have been no  significant  changes in the
Partnership's  internal  controls or in other  factors that could  significantly
affect the  Partnership's  internal  controls since the date of evaluation.  The
Partnership does not believe any significant deficiencies or material weaknesses
exist in the Partnership's internal controls. Accordingly, no corrective actions
have been taken.

                                   SIGNATURES



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


                                    MULTI-BENEFIT REALTY FUND '87-1


                                    By:   CONCAP EQUITIES, INC.
                                          Its General Partner


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


                                    By:   /s/Thomas C. Novosel
                                          Thomas C. Novosel
                                          Senior Vice President
                                          and Chief Accounting Officer


                              Date: March 31, 2003


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


/s/Patrick J. Foye      Executive Vice President      Date: March 31, 2003
Patrick J. Foye         and Director


/s/Thomas C. Novosel    Senior Vice President         Date: March 31, 2003
Thomas C. Novosel       and Chief Accounting Officer



                                  CERTIFICATION


I, Patrick J. Foye, certify that:


1. I have  reviewed this annual  report on Form 10-KSB of  Multi-Benefit  Realty
Fund '87-1;


2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities,  particularly  during the period in which this annual  report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      annual report (the "Evaluation Date"); and


      c) Presented in this annual report our conclusions about the effectiveness
      of the disclosure  controls and  procedures  based on our evaluation as of
      the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date:  March 31, 2003

                              /s/Patrick J. Foye
                              Patrick J. Foye
                              Executive Vice President of ConCap Equities, Inc.,
                              equivalent of the chief executive officer of the
                              Partnership

                                  CERTIFICATION


I, Paul J. McAuliffe, certify that:


1. I have  reviewed this annual  report on Form 10-KSB of  Multi-Benefit  Realty
Fund '87-1;


2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities,  particularly  during the period in which this annual  report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      annual report (the "Evaluation Date"); and


      c) Presented in this annual report our conclusions about the effectiveness
      of the disclosure  controls and  procedures  based on our evaluation as of
      the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date:  March 31, 2003

                              /s/Paul J. McAuliffe
                              Paul J. McAuliffe
                              Executive  Vice  President  and  Chief  Financial
                              Officer  of ConCap  Equities,  Inc.,  equivalent
                              of the chief financial
                              officer of the Partnership

                                  EXHIBIT INDEX



Exhibit

2.1  Agreement  and Plan of Merger,  dated as of October 1, 1998, by and between
     AIMCO and IPT,  incorporated by reference to Registrant's Current Report on
     Form 8-K dated October 1, 1998.

                  Exhibit 3.1, Agreement of Limited Partnership, incorporated by
                  reference to Exhibit A-5 to the  Prospectus of the  Registrant
                  dated December 10, 1986 as filed with the Commission  pursuant
                  to Rule 424(b) under the Act.

                  Exhibit 3.2, Certificate of Limited Partnership  (incorporated
                  by reference to Registration Statement of Registrant (File No.
                  3-38908) filed December 10, 1986, as amended to date).

4    Depositary Agreement  (Incorporated by reference to Registration  Statement
     of Registrant  (File No.  33-8908)  filed  December 10, 1986, as amended by
     date).

10.12             Letter of Notice dated  December 20,  1991,  from  Partnership
                  Services, Inc. ("PSI") to the Partnership regarding the change
                  in  ownership  and  dissolution  of  ConCap  Services  Company
                  whereby   PSI  assumed  the   Investor   Services   Agreement.
                  (Incorporated  by reference to the Annual  Report on Form 10-K
                  for the year ended December 31, 1991).

10.15             Letter of Notice  dated  December  20,  1991,  from PSI to the
                  Partnership  regarding the change in ownership and dissolution
                  of ConCap  Capital  Company  whereby PSI assumed the Financial
                  Services  Agreement.  (Incorporated by reference to the Annual
                  Report on Form 10-K for the year ended December 31, 1991).

10.18Letter dated  December 8, 1994 reporting a change in control of the General
     Partner of the  Registrant.  (Incorporated  by  reference to Form 8-K dated
     December 8, 1994).

10.21Purchase and Sale Contract  between  Registrant and Carlin Manor Investors,
     Ltd., an Ohio Limited Liability Company, dated April 7, 2000. (Incorporated
     by reference to the Current Report on Form 8-K dated June 13, 2000.)

10.22Multifamily   Note  dated  August  31,  2000,  by  and  between  Hunt  Club
     Associates, Ltd., a Texas limited partnership, and ARCS Commercial Mortgage
     Co.,  L.P.,  a  California  limited  partnership   relating  to  Hunt  Club
     Apartments.  (Incorporated  by  reference to the  Quarterly  Report on Form
     10-QSB for the quarter ended September 30, 2000.)

10.23Multifamily  Note  dated  August 31,  2001,  by and  between  Multi-Benefit
     Realty Fund '87-1, a California  limited  partnership  and GMAC  Commercial
     Mortgage Corporation,  a California  corporation,  relating to Shadow Brook
     Apartments.  (Incorporated  by  reference to the  Quarterly  Report on Form
     10-QSB for the quarter ended September 30, 2001.)

11   Statement  regarding  computation  of Net  Income  per  Unit of  Depositary
     Receipt  (Incorporated  by  reference  to "Note  A" of  "Item 7.  Financial
     Statements" of this Form 10-KSB).


99   Certification of Chief Executive Officer and Chief Financial Officer.





Exhibit 99


                          Certification of CEO and CFO
                       Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002



In connection with the Annual Report on Form 10-KSB of Multi-Benefit Realty Fund
'87-1 (the  "Partnership"),  for the year ended  December 31, 2002 as filed with
the  Securities  and  Exchange  Commission  on the date hereof  (the  "Report"),
Patrick  J.  Foye,  as the  equivalent  of the Chief  Executive  Officer  of the
Partnership,  and Paul J.  McAuliffe,  as the equivalent of the Chief  Financial
Officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section
1350,  as adopted  pursuant  to Section 906 of the  Sarbanes-Oxley  Act of 2002,
that, to the best of his knowledge:

(1)  The Report fully complies with the  requirements  of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

(2)  The information  contained in the Report fairly  presents,  in all material
     respects,  the  financial  condition  and  results  of  operations  of  the
     Partnership.


                                    /s/Patrick J. Foye
                              Name: Patrick J. Foye
                              Date: March 31, 2003


                                    /s/Paul J. McAuliffe
                              Name: Paul J. McAuliffe
                              Date: March 31, 2003


This  certification  accompanies  the  Report  pursuant  to  Section  906 of the
Sarbanes-Oxley  Act of 2002 and shall not,  except to the extent required by the
Sarbanes-Oxley  Act of 2002, be deemed filed by the  Partnership for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended.