<PAGE>



                         SECURITIES AND EXCHANGE COMMISSION
                                Washington, DC 20549

                                     FORM 10-K
              (Mark One)

           [X]ANNUAL  REPORT  PURSUANT  TO SECTION 13 OR 15(d)
              OF THE  SECURITIES  EXCHANGE ACT OF 1934 [FEE REQUIRED] For fiscal
              year ended December 31, 1998

                                            OR

           [  ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE
              SECURITIES  EXCHANGE  ACT  OF  1934  [NO  FEE  REQUIRED]  For  the
              transition period from ________ to ________.

                                      0-17412
                              (Commission File Number)

                                Secured Income L.P.
        (Exact name of registrant as specified in its governing instruments)

            Delaware                                     06-1185846
(State or other jurisdiction                (I.R.S. Employer Identification No.)
    of organization)                      

Wilder Richman Resources Corporation
599 W. Putnam Avenue
Greenwich, Connecticut                                                 06830
(Address of principal executive offices)                            (Zip Code)

Registrant's telephone number, including area code:             (203) 869-0900

Securities registered pursuant to Section 12(b) of the Act:

           None
(Title of each Class)

Securities registered pursuant to Section 12(g) of the Act:

                 Units of Limited Partnership Interest
                               Title of Class)

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

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

The aggregate sales price of the units of limited  partnership  interest held by
non-affiliates  of the Registrant is  $19,687,380.  There is currently no public
market for the units of limited  partnership  interest  and,  accordingly,  such
figure does not represent the market value for the units.

Documents incorporated by reference:

The Prospectus of the Registrant,  dated March 5, 1987 as supplemented and filed
pursuant  to  Rule  424(b)  and  (c)  under  the  Securities  Act  of  1933,  is
incorporated by reference into Parts I, II and III of this Annual Report on Form
10-K.


<PAGE>

                                     


                                  PART I


Item 1   Business


General Development of Business

Registrant  (also  referred to as the  "Partnership")  is a limited  partnership
which was formed under the Delaware  Revised Uniform Limited  Partnership Act on
October  10,  1986.  The  general  partners  of the  Partnership  (the  "General
Partners") are Wilder Richman  Resources  Corporation,  a Delaware  corporation,
Real Estate Equity  Partners L.P., a Delaware  limited  partnership  and WRC-87A
Corporation, a Delaware corporation.

The  Partnership  was  organized  to invest in luxury  multi-family  residential
housing  complexes  (the  "Complexes")  by  acquiring  approximately  99% of the
limited partnership interest (the "Operating  Partnership  Interest") in limited
partnerships that own and operate such Complexes (the "Operating Partnerships").
WRC-87A  Corporation is a special limited partner of each Operating  Partnership
and has certain rights in connection  therewith.  Pursuant to Rule 12b-23 of the
Securities and Exchange  Commission's General Rules and Regulations  promulgated
under the  Securities  Exchange  Act of 1934,  as amended,  the  description  of
Registrant's  business set forth under the heading  "Investment  Objectives  and
Policies" at pages 20 through 30 of the  prospectus,  dated March 5, 1987,  (the
"Prospectus") is incorporated herein by reference.

Pursuant to the  Partnership's  Prospectus,  as supplemented on October 2, 1987,
December 15, 1987 and March 29, 1988, the Partnership  offered up to $50 million
of units of limited partnership  interest in the Partnership (the "Units") at an
offering price of $20 per Unit. The Units were  registered  under the Securities
Act of 1933 pursuant to a Registration Statement on Form S-11 (Registration No.
33-9602).

Registrant  terminated  the offering of Units (the  "Offering")  on February 29,
1988  upon  raising  sufficient  capital  from  the  sale of  Units  to fund the
acquisition  of the two properties  specified for investment by Registrant.  The
Offering  raised  $19,687,380  from the sale of 984,369 Units.  After payment of
$1,378,117 of selling  commissions and $1,378,116 of  organization  and offering
expenses and  acquisition  fees, the net proceeds  available for investment were
$16,931,147. Of such net proceeds,  $16,734,273 was allocated to the acquisition
of  investments  in  the  Operating  Partnerships  (the  "Operating  Partnership
Interests") which included investments in guaranteed investment  contracts.  The
remaining net proceeds of $196,874 was designated as working  capital to be used
for operating expenses of the Partnership.

Competition

Information  regarding  competition,  general risks,  tax risks and  partnership
risks is set forth  under the heading  "Risk  Factors" at pages 37 through 48 of
the Prospectus, which is incorporated herein by reference.

Compliance with Environmental Protection Provisions

Registrant is not aware of any non-compliance by the Operating Partnerships with
respect to federal,  state and local  provisions  regulating  the  discharge  of
material into the  environment  or otherwise  relating to the  protection of the
environment, and is not aware of any condition that would have a material effect
on the capital expenditures or competitive position of Registrant.

Employees of Registrant

Registrant  employs no personnel  and incurs no payroll  costs.  An affiliate of
Wilder Richman Resources Corporation employs individuals who perform accounting,
secretarial,  transfer  and  other  services  on  behalf  of  Registrant  as are
necessary in the  ordinary  course of business.  Such  individuals  also perform
similar services for other affiliates of Wilder Richman Resources Corporation.

                                       2

<PAGE>
<TABLE>
<CAPTION>


Tax Reform Act of 1986, Revenue Act of 1987, Technical and Miscellaneous Revenue
Act  of  1988,  Omnibus  Budget  Reconciliation  Act  of  1989,  Omnibus  Budget
Reconciliation   Act  of  1990,  Tax  Extension  Act  of  1991,  Omnibus  Budget
Reconciliation Act of 1993, Uruguay Round Agreements Act and Taxpayer Relief Act
of 1997 (collectively the "Tax Acts")

Registrant  is organized as a limited  partnership  and is a "pass  through" tax
entity which does not, itself, pay Federal income tax. However,  the partners of
Registrant  who are  subject to Federal  income tax may be  affected  by the Tax
Acts.  Registrant will consider the effect of certain aspects of the Tax Acts on
the partners when making decisions  regarding its  investments.  Registrant does
not anticipate  that the Tax Acts will currently have a material  adverse impact
on Registrant's business operations, capital resources and plans or liquidity.

Item 2   Properties

The following table sets forth information  regarding the Complexes owned by the
Operating Partnerships as of December 31, 1998.

                                                     Number of
         Property               Location            Dwelling Units
          <S>                      <C>                  <C>
         Fieldpointe Apartments Frederick, MD           252
         The Westmont           New York, NY            163
</TABLE>
Fieldpointe  Apartments,  which is  owned by  Carrollton  X  Associates  Limited
Partnership (the "Carrollton Partnership"),  is comprised of 252 apartment units
totalling  approximately  235,000  square  feet with  approximately  500 parking
spaces.  On-site  amenities  include a clubhouse  building  with locker room and
on-site management office, a swimming pool and two tennis courts. The apartments
feature numerous amenities, including dishwashers, disposals and fireplaces.

The  Partnership  acquired its interest as a limited  partner in the  Carrollton
Partnership  by making a capital  contribution  of  $3,121,995.  Of this amount,
$1,373,039  was invested in guaranteed  investment  contracts and $1,748,956 was
contributed  upon the  Partnership's  acquisition  of the Operating  Partnership
Interest,  including the amount due upon the  achievement  of sustaining  rental
revenue.

The mortgage financing of the Carrollton  Partnership was modified on August 30,
1993  from  the sale of  tax-exempt  bonds  pursuant  to the  terms  of  Section
103(b)(4)(a) of the Internal  Revenue Code. The modified  mortgage in the amount
of  $10,494,100,  bearing fixed 6.09%  interest (with an exception for the first
ten months through  August 1994) and with a term of 35 years,  is insured by the
United States Department of Housing and Urban Development  ("HUD") under Section
221(d)(4)  of the  National  Housing  Act,  as  amended.  Under the terms of the
financing, 80% of the units are permitted market rate rents and 20% of the units
are to be rented  to people  earning  no more  than the low or  moderate  income
levels within the meaning of Section  103(b)(4)(a) of the Internal Revenue Code.
The Fieldpointe  Apartments  occupancy rate was approximately 95% as of December
31, 1998.

The   Westmont,   which  is  owned  by  Columbia   Associates   (the   "Columbia
Partnership"),  contains 163  apartment  units,  9,415 square feet of commercial
space,  46 garage parking  spaces,  and a penthouse with an exercise  center and
health club which offers exercise  equipment,  steam room, sauna,  jacuzzi and a
large terrace.  The apartments  feature  numerous  luxury  amenities,  including
security systems, microwave ovens, dishwashers and hardwood floors.

The  Partnership  acquired  its  interest as a limited  partner in the  Columbia
Partnership by making a capital  contribution  of  $12,571,634.  Of this amount,
$6,651,323 was invested in guaranteed investment contracts (which had a value of
$5,610,679,  including  net  accrued  interest  of  $18,918,  at the time of the
acquisition as a result of principal  amortization from the dates of purchase of
such guaranteed  investment contracts to the closing of the Columbia Partnership
acquisition),  $5,921,104 was contributed upon the Partnership's  acquisition of
the Operating  Partnership  Interest in the Columbia  Partnership and $1,039,851
was contributed to the Columbia  Partnership  upon the achievement of sustaining
rental revenue.

The mortgage financing of the Columbia  Partnership was modified on May 27, 1993
pursuant  to  a  bond  refunding  by  the  New  York  City  Housing  Development
Corporation  ("HDC")  in the  amount  of  $27,600,000.  Under  the  terms of the
modified financing,  the Columbia Partnership agreed that 20% of the residential
units in The Westmont will be maintained for occupancy by low or moderate income
tenants through July 2004. The Westmont's occupancy rate as of December 31, 1998
was  approximately  100% as to both  residential  dwelling  units and commercial
space.

                                       3

<PAGE>
<TABLE>
<CAPTION>

As of  December  31,  1998,  the  market  rental  rates  of the  Complexes  were
approximately as follows:


                         Fieldpointe           The
                         Apartments         Westmont
          <S>                 <C>              <C>
     Monthly Rental Rates:
        Studio                            $1,610-$2,100
        One-Bedroom       $600-$660       $1,606-$2,758
        Two-Bedroom       $625-$760       $1,951-$3,850
        Three-Bedroom     $775-$885       $3,419-$4,200

</TABLE>
The low and moderate income rental rates as of December 31, 1998 for Fieldpointe
Apartments fall within the ranges noted above. Such rates for The Westmont range
from $705 to $948.

Further information regarding the Complexes and Registrant's interest therein is
set forth under the heading Specified  Investments at pages 30 through 36 of the
Prospectus,  and in the supplements to the Prospectus  dated October 2, 1987 and
March 29, 1988.


Item 3   Legal Proceedings

None


Item 4   Submission of Matters to a Vote of Security Holders

None

                                       4
<PAGE>
<TABLE>
<CAPTION>



                                      PART II

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

Market

There is no  developed  public  market  for the  purchase  and sale of Units and
Registrant does not anticipate that such a market will develop.

Holders

As of December 31, 1998, there were approximately  1,206 record holders of Units
(the  "Limited   Partners")  holding  an  aggregate  of  984,369  Units  in  the
Partnership.

Distributions

The Agreement of Limited Partnership of Registrant (the "Partnership Agreement")
provides  that all Cash  Available  for  Distribution  (as  defined  therein) be
distributed quarterly to the partners in specified  proportions.  As part of the
restructuring of the Columbia Partnership's  financing, the Columbia Partnership
is prohibited from  distributing  cash flow from operations.  See Item 7 herein,
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations,  for further discussion.  There were no distributions to the Limited
Partners declared during the years ended December 31, 1998 and 1997.


Item 6   Selected Financial Data

The  following  table  summarizes   certain  selected   consolidated   financial
information  concerning  Registrant and should be read in  conjunction  with the
consolidated financial statements and the related notes thereto:


                              Year Ended December 31,


            1998            1997           1996           1995        1994
        -----------     -----------     ----------     ----------  ----------
<S>          <C>              <C>            <C>            <C>         <C>    
Total 
revenue $7,078,399       $6,787,161     $6,434,698     $6,092,551   $5,880,772

Net loss  (216,504)        (596,273)       (69,521)      (397,620)    (465,413)

Net loss 
allocated
per unit 
of limited
partnership
interest         -               -              -              -         (.39)

At year 
end:

Total
assets  38,958,954       38,149,194     39,322,376     40,458,675  41,709,487

Mortgages 
payable 33,973,81        34,449,756     35,320,565     36,589,220  37,441,770

Long-term 
debt           -                 -              -              -          -

</TABLE>
                                       5

<PAGE>



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

Liquidity and Capital Resources

The Partnership's  primary sources of funds are rents generated by the Operating
Partnerships  and interest  derived  from  investments  and  deposits  which are
restricted  in  accordance  with the  terms of the  mortgages  of the  Operating
Partnerships.  As of January 15, 1995, the guaranteed investment contracts which
were  acquired  to provide  distributions  to the  Limited  Partners  were fully
amortized.  One guaranteed investment contract owned by the Columbia Partnership
became fully  amortized on January 15, 1998, the proceeds of which were utilized
for investor service charges of the Columbia Partnership through December 1997.
The Partnership's investments are highly illiquid.

The  Partnership  is not  expected  to have  access  to  additional  sources  of
financing.   Accordingly,  if  unforeseen  contingencies  arise  that  cause  an
Operating  Partnership to require capital in addition to that contributed by the
Partnership and any equity of the Operating General Partners,  potential sources
from which such capital needs will be able to be satisfied (other than reserves)
would be additional  equity  contributions of the Operating  General Partners or
other equity  reserves,  if any, which could adversely  affect the  distribution
from the Operating  Partnerships  to the  Partnership of operating cash flow and
sale or refinancing proceeds.  Prior to the modification of the mortgages of the
respective  Operating  Partnerships  during  1993,  the rents  generated  by the
Operating  Partnerships  were  generally  not  sufficient  to  fully  cover  the
operating expenses and debt service requirements of the Operating  Partnerships.
Although  the  Operating  Partnerships  were  successful  in  refinancing  their
respective  mortgages with significantly lower mandatory payment terms,  certain
restrictions were placed on the respective Operating  Partnerships in connection
with  distributions,   among  other  things.  Prior  to  the  refinancings,  the
respective   Operating  General  Partners  provided  funds  necessary  to  cover
operating deficits in the form of advances and fee deferrals; however, there can
be no assurance that the  respective  Operating  General  Partners would provide
additional funds to the extent they may be needed.

Investment in guaranteed  investment contract decreased by approximately $19,000
as a result of the  amortization  of principal  from the quarterly  payment from
such  contract.  The payments of principal and interest from such contracts were
previously  utilized by the  Partnership to make  distributions  to the partners
(through December 1994) and to cover a portion of the investor services expenses
incurred by the  Partnership.  Virtually all  distributions  to partners to date
have been generated from the investment in guaranteed investment contracts.  The
General Partners do not anticipate  significant cash flow distributions from the
properties  given the  restrictions on cash flow  distributions  of the Columbia
Partnership resulting from the restructuring of its refinancing in 1993.

During 1998,  as a result of the cash flows  generated by the  operations of the
Complexes,  cash and  cash  equivalents  increased  by  approximately  $568,000.
Mortgages  payable  decreased  due to principal  amortization  of  approximately
$476,000. Due to general partners and affiliates decreased primarily as a result
of the  repayment  of $300,000 of advances  previously  provided by the Columbia
Operating  General Partners (see discussion below concerning the modification of
the Columbia  Partnership's  Pledged Cap Account and the modification of certain
partner  guarantees) and the payment of $265,000 by the Partnership for investor
services fees incurred in prior years,  partially offset by the accrued interest
on advances provided by the Columbia  Operating General Partners and the accrual
of investor services fees incurred in the current year. As of December 31, 1998,
the Partnership owes  approximately  $565,000 to an affiliate of certain General
Partners for accrued investor services fees.

Property and equipment  decreased by approximately  $1,423,000  primarily due to
depreciation,  while  intangible  assets  decreased  by  approximately  $108,000
primarily due to amortization.  Property and equipment and intangible assets are
expected to decrease annually as the cost of these assets is allocated to future
periods over their remaining lives.

As of December 31, 1998, the balance in the Columbia  Partnership's  Pledged Cap
Account (see discussion below) is approximately $2,766,000. The original outside
date for the Pledged Cap Account to be  utilized  for its  intended  purpose was
October 31, 1996. The Columbia  Operating  General  Partners had been conducting
discussions  with the lender in order to address  other  potential  uses of such
account, including utilizing such funds for costs in connection with a potential
refinancing of the mortgages with another lender.  During April 1998, the lender
agreed to  restructure  the original  terms  concerning  the Pledged Cap Account
whereby the account may be utilized for potential  debt service  shortfalls  (in
the event the low  floater  rate is higher  than the stated note rate of 4.66%),
but not cause the Pledged Cap Account to decline below a balance of  $1,000,000.
An interest rate cap may be purchased upon the Pledged Cap Account reaching such
minimum  threshold  or in the event the low  floater  rate rises above 7% for 90
consecutive days or 7.5% for 30 consecutive days. In addition, the lender agreed
to eliminate and reduce certain partner  guarantees,  thereby  releasing certain
previously restricted assets of approximately  $1,000,000, of which $300,000 was
provided by and repaid to the Columbia Operating General Partners.  Although the
Columbia Operating General Partners have been conducting  discussions with other
potential  credit  enhancers  and continue to explore  alternatives  in order to
obtain a lower  effective  borrowing  rate,  there can be no assurance  that the
lender would approve any  alternative  utilization of such account,  or that the
Columbia Operating General Partners will procure suitable alternative financing.

                                       6

<PAGE>

Results of Operations

Year Ended December 31, 1998

During 1998, the Columbia Partnership and the Carrollton  Partnership  generated
income from operating  activities of approximately  $2,884,000 and approximately
$1,063,000,  respectively.  Mortgage  principal  payments  during  1998  for the
Columbia Partnership and the Carrollton  Partnership were approximately $356,000
and  approximately  $120,000,   respectively.   In  the  case  of  the  Columbia
Partnership,  the maximum  amount  permitted to be  deposited  to the  Operating
Deficit Reserve ($500,000) was achieved during 1994; accordingly,  no additional
deposits to the Operating  Deficit  Reserve are required  other than to maintain
the  account  at a balance  of  $500,000.  No  amounts  were  utilized  from the
Operating  Deficit Reserve during 1998.  Deposits to the Pledged Cap Account and
the  Bond  Retirement  Escrow  during  1998  were  approximately   $572,000  and
approximately  $213,000,  respectively.  Pursuant  to the terms of the  Columbia
Partnership's  mortgages,  the lender is entitled to a credit enhancement fee of
2.5% per annum based on the outstanding loan balance.  During 1998, the Columbia
Partnership incurred $627,694 in connection with such fee. After considering the
respective mandatory mortgage principal payments,  required deposits to mortgage
escrows and payments for the credit  enhancement  fee,  among other things,  the
Complexes  generated  combined cash flow of approximately  $304,000 during 1998.
Any savings  realized  on the  difference  between the initial  note rate on the
Columbia  Partnership's  mortgages  of 4.66% and the  actual  low  floater  rate
(approximately  3.23% weighted  average rate during 1998) are deposited into the
Pledged  Cap  Account.  To the  extent  the future  cash flow  generated  by the
Columbia  Partnership is not utilized to fund the Operating  Deficit  Reserve or
Pledged Cap  Account,  such cash flow,  under the Citibank  loan terms,  will be
deposited to the Bond Retirement  Escrow to make additional  mortgage  principal
payments.  However,  there  can be no  assurance  that the  level  of cash  flow
generated by the Complexes in 1998 will continue in future years.

Results of operations  improved in 1998 as compared to 1997.  Financial expenses
decreased  as a  result  of  costs  being  incurred  in  1997  by  the  Columbia
Partnership  in connection  with attempts to refinance its mortgages and savings
realized from the decrease in the weighted average interest rate on the Columbia
Partnership's  mortgages from approximately 3.56% in 1997 to approximately 3.23%
in 1998.  Operating and  maintenance  expenses were higher during the year ended
December 31, 1997  primarily  due to scheduled  maintenance  in 1997.  Taxes and
insurance  expenses  increased  in 1998  due  primarily  to an  increase  in the
Columbia  Partnership's real estate taxes, which includes charges for 1997 taxes
not billed until 1998,  net of a refund of certain prior years' taxes.  Based on
the current assessment of the Columbia Property, annual real estate taxes of the
Columbia Partnership have increased by approximately $300,000.  Interest revenue
for the year ended  December 31, 1998 is comparable  to the year ended  December
31, 1997 and was  generated  primarily  from  Partnership  deposits  and escrows
established in connection with the Columbia Partnership's mortgages.

As  of  December  31,  1998,  the  occupancy  of   Fieldpointe   Apartments  was
approximately 95% and the occupancy of The Westmont was approximately 100% as to
both residential units and commercial space. The future operating results of the
Complexes will be extremely  dependent on market conditions and therefore may be
subject to significant volatility.  The Complexes are generally in good physical
condition and are being managed by experienced management companies.

Year Ended December 31, 1997

During 1997, the Columbia Partnership and the Carrollton  Partnership  generated
income from operating  activities of approximately  $3,003,000 and approximately
$949,000, respectively. Mortgage principal payments during 1997 for the Columbia
Partnership  and the  Carrollton  Partnership  were  approximately  $758,000 and
approximately  $113,000,  respectively.  Deposits to the Pledged Cap Account and
the  Bond  Retirement  Escrow  during  1997  were  approximately   $439,000  and
approximately  $252,000,  respectively.  During 1997,  the Columbia  Partnership
incurred  $582,229 in connection with the lender credit  enhancement  fee. After
considering  the respective  mandatory  mortgage  principal  payments,  required
deposits to mortgage  escrows,  accelerated  principal  payments on the Columbia
Mortgages and payments for the credit  enhancement fee, among other things,  the
Complexes generated combined cash flow of approximately $161,000 during 1997.

Although the Complexes  generated  cash flow during 1997,  results of operations
declined as compared to 1996  primarily as a result of (i) the  commencement  of
the  credit  enhancement  fee in  connection  with  the  Columbia  Partnership's
mortgages (on February 1, 1997), (ii) costs incurred by the Columbia Partnership
in connection  with attempts to refinance its mortgages and (iii) an increase in
the weighted average interest rate on the Columbia Partnership's  mortgages from
approximately 3.29% to approximately  3.56%.  Operating and maintenance expenses
increased  for the year ended  December  31,  1997  primarily  due to  scheduled
maintenance. Interest revenue for the year ended December 31, 1997 is comparable
to the year ended December 31, 1996 and was generated primarily from Partnership
deposits and escrows  established in connection with the Columbia  Partnership's
mortgages.  As of December 31, 1997, the occupancy of Fieldpointe Apartments was
approximately  98% and the occupancy of The Westmont was approximately 99% as to
residential units and 100% as to commercial space.

                                       7

<PAGE>

Year Ended December 31, 1996

During 1996, the Columbia Partnership and the Carrollton  Partnership  generated
income from operating  activities of approximately  $2,838,000 and approximately
$961,000,  respectively.  Deposits  to the  Pledged  Cap  Account  and the  Bond
Retirement  Escrow  during 1996 were  approximately  $439,000 and  approximately
$712,000, respectively. Mortgage principal payments during 1996 for the Columbia
Partnership and the Carrollton  Partnership  were  approximately  $1,162,000 and
approximately $106,000,  respectively, which amount for the Columbia Partnership
includes $800,000 of additional payments from the Bond Retirement Escrow.  After
considering  the respective  mandatory  mortgage  principal  payments,  required
deposits to mortgage escrows and accelerated  principal payments on the Columbia
Mortgages,  among other things,  the Complexes  generated  combined cash flow of
approximately $259,000 during 1996.

The  Partnership's  results  from  operations  improved  during  the year  ended
December  31,  1996 as  compared  to the year ended  December  31, 1995 due to a
decrease in the weighted  average  interest  rate on the Columbia  Partnership's
mortgages and an increase in rental revenue.  Operating and maintenance expenses
increased  for the year ended  December  31,  1996  primarily  due to  increased
maintenance  salaries.  Interest revenue for the year ended December 31, 1996 is
comparable to the year ended December 31, 1995 and was generated  primarily from
Partnership  deposits and escrows  established  in connection  with the Columbia
Partnership's  mortgages.  As of December 31, 1996, the occupancy of Fieldpointe
Apartments  was  approximately  99%  and  the  occupancy  of  The  Westmont  was
approximately  99% as to residential  units and 100% as to commercial space. The
commercial space was fully occupied throughout 1996, resulting in an increase in
commercial rent revenue of approximately $133,000 as compared to 1995.

Adoption of Accounting Standards

The Partnership has adopted Statement of Financial  Accounting Standard ("SFAS")
No. 130, "Reporting  Comprehensive  Income." SFAS No. 130 establishes  standards
for reporting and display of comprehensive  income and its components  (revenue,
expenses,  gains and losses) in the financial  statements  and requires that all
such items  required to be recognized as components of  comprehensive  income be
reported and  displayed  with the same  prominence  as items in other  financial
statements.  The adoption of SFAS No. 130 has had no impact on the Partnership's
consolidated financial statements.

The  Partnership  has adopted SFAS No. 131,  "Disclosures  about  Segments of an
Enterprise and Related  Information," which establishes  standards for reporting
information about operating segments and related  disclosures about products and
services,  geographic  areas  and major  customers.  The  Partnership  is in one
business segment and follows the requirements of SFAS No.131.

Year 2000 Compliance

The   inability   of   computers,   software  and  other   equipment   utilizing
microprocessors  to recognize and properly process data fields  containing a two
digit year is commonly referred to as the year 2000 compliance ("Y2K") issue. As
the year 2000  approaches,  such  systems  may be unable to  accurately  process
certain  data-based  information.  Many businesses may need to upgrade  existing
systems or purchase new ones to correct the Y2K issue. The total cost associated
with Y2K  implementation  is not expected to materially impact the Partnership's
financial  position or results of operations in any given year.  However,  there
can be no assurance that the systems of other entities on which the  Partnership
relies,  including  Carrollton and Columbia which report to the Partnership on a
periodic basis for the purpose of the Partnership's  reporting to its investors,
will be timely converted. There can be no assurance that a failure to convert by
another entity would not have a material adverse impact on the Partnership.

Item 7A     Quantitative and Qualitative Disclosures About Market Risk

The Partnership has market risk sensitivity with regard to financial instruments
concerning potential interest rate fluctuations in connection with the low
floater rates associated with the COlumbia Partnership's mortgages.
Accordingly, an increase in the low-floater interest rates could have a 
material adverse impact on the Partnership's results of operations.

Item 8      Financial Statements and Supplementary Data

Set  forth in the  financial  statements  listed  on page  F-2 is the  financial
information  required  in  response  to Item 8. Such  financial  statements  and
schedules appear on pages F-1 to F-16 and are incorporated herein by reference.

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

None.

                                       8

<PAGE>
<TABLE>
<CAPTION>

                                      PART III

Item 10  Directors and Executive Officers of the Registrant

The Partnership has no directors or executive officers.

The  General  Partners  are Wilder  Richman  Resources  Corporation,  a Delaware
corporation  (the "WRC General  Partner"),  Real Estate Equity  Partners L.P., a
Delaware  limited  partnership  and an affiliate of Lehman  Brothers  Inc.  (the
"Lehman General Partner") and WRC-87A  Corporation,  a Delaware corporation (the
"L/WRC General Partner").  The L/WRC General Partner is currently one-half owned
by Real Estate Equity Partners Inc., the corporate general partner of the Lehman
General  Partner,  and  one-half  owned by the  shareholders  of the WRC General
Partner.

                              The WRC General Partner


The directors and officers of the WRC General Partner set forth below:

Certain  officers and  directors  of Real Estate  Equity  Partners  Inc. are now
serving (or in the past have served) as officers or directors of entities  which
act as general  partners of a number of real estate limited  partnerships  which
have sought protection under the provisions of the Federal  Bankruptcy Code. The
partnerships  which have filed  bankruptcy  petitions  own real estate which has
been adversely  affected by the economic  conditions in the markets in which the
real estate is located and, consequently, the partnerships sought the protection
of the  bankruptcy  laws to protect the  partnerships'  assets from loss through
foreclosure.

      Name                  Age     Office
     <S>                    <C>      <C>
      Richard Paul Richman  51      President and Director

      Robert H. Wilder, Jr. 53      Executive Vice President, Secretary,
                                     Treasurer and Director
</TABLE>
Each of such  directors  and  officers  have served in such  capacity  since the
company's formation.

Richard Paul Richman is President and Director of the WRC General  Partner.  Mr.
Richman  graduated  from the Columbia  University Law School with a Juris Doctor
degree, the Columbia University Graduate School of Business  Administration with
a Master of  Business  Administration  degree  and  Syracuse  University  with a
Bachelor of Arts degree in Political Science.  Mr. Richman has over ten years of
extensive  experience in both the  development  and  management  of  residential
properties.  From 1973 until 1979,  Mr. Richman  practiced  corporate law in New
York City with the law firm of Greenbaum, Wolff & Ernst and then as a partner of
Shipley, Richman & Nierenberg. For over six years, Mr. Richman acted as a lawyer
in connection with the development,  syndication and tax issues relating to real
estate.  Since 1988, Mr. Richman has been the President and sole  stockholder of
The Richman  Group,  Inc. In recent years,  Mr. Richman has devoted full time to
the syndication and development of real estate. Mr. Richman was a vice president
and shareholder of Related Housing  Companies  Incorporated,  New York, New York
from  1978  until  mid-1979  with  responsibility  for  that  company's  project
acquisition  and  syndication  activities.  Mr. Richman has been a member of the
National  Advisory Board of the Housing and  Development  Reporter,  a bi-weekly
publication of the Bureau of National Affairs,  Inc., a frequent speaker on real
estate syndication, has been a member of the New York State Historic Credit Task
Force,  the National Leased Housing  Association,  the Coalition to Preserve the
Low-Income Tax Credit and the Minority Developer  Assistance  Corporation (which
was established by the New York State Battery Park Commission).

Robert H. Wilder,  Jr. is Executive  Vice  President,  Secretary,  Treasurer and
Director of the WRC General Partner. Mr. Wilder graduated from the University of
Michigan  with a Bachelor  of Arts  degree in  Economics  and from the  Columbia
University Graduate School of Business with a Master of Business  Administration
degree.   After  graduation  in  1968,  Mr.  Wilder  joined  James  D.  Landauer
Associates,   Inc.,  a  national  real  estate   consulting   firm,   where  his
responsibilities   included  feasibility  studies,  market  analyses,  land  use
studies,  portfolio valuations and appraisals of industrial,  office, commercial
and multi-family properties.  From 1973 until mid-1979, Mr. Wilder was executive
vice president and shareholder of Related Housing  Companies  Incorporated,  New
York, New York, and was responsible for mortgage financing and construction loan
placement and the  supervision  of the  development  of the company's  projects.
Since 1988,  Mr. Wilder has been the President  and sole  shareholder  of Wilder
Property  Companies Inc. Mr. Wilder is also a licensed real estate broker in New
York and Connecticut.

                                       9

<PAGE>
<TABLE>
<CAPTION>



                             The Lehman General Partner

The directors and officers of Real Estate Equity Partners Inc. are set forth 
below.

Certain  officers and  directors  of Real Estate  Equity  Partners  Inc. are now
serving (or in the past have served) as officers or directors of entities  which
act as general  partners of a number of real estate limited  partnerships  which
have sought protection under the provisions of the Federal  Bankruptcy Code. The
partnerships  which have filed  bankruptcy  petitions  own real estate which has
been adversely  affected by the economic  conditions in the markets in which the
real estate is located and, consequently, the partnerships sought the protection
of the  bankruptcy  laws to protect the  partnerships'  assets from loss through
foreclosure.

      Name                  Age     Office
       <S>                  <C>      <C>
      Doreen D. Odell       39      President & Chief Financial Officer

      Joan B. Berkowitz     39      Vice President


     Doreen D. Odell is Senior Vice  President of Lehman  Brothers  Inc. and has
worked with its Diversified Asset Group since June 1988. Ms. Odell graduated Phi
Beta  Kappa and  received a B.A.  in  Economics  summa cum laude from  Wellesley
College  in 1981.  She  received  a M.S.  in Real  Estate  Development  from the
Massachusetts  Institute of Technology in 1986. Prior to joining Lehman Brothers
Inc.,  Ms. Odell was involved in real estate  development in both the public and
private  sectors.  As a  development  manager  with  N.Y.C.  Public  Development
Corporation,  she structured  joint ventures with private  developers.  She also
worked  with  a  private  development  company,   The  Harborside   Corporation,
evaluating real estate investments and development  projects.  From 1981 through
1984,  Ms. Odell was a  construction  loan officer with  Manufacturer's  Hanover
Trust Company.

Joan B. Berkowitz is a Vice President of Lehman Brothers Inc. and
is responsible for investment  management of retail,  commercial and residential
real estate within its  Diversified  Asset Group.  Ms.  Berkowitz  joined Lehman
Brothers Inc. in May 1986 as an accountant in its Realty  Investment Group. From
October  1984 to May 1986,  she was an  Assistant  Controller  to the  Patrician
Group.  From  November  1983 to October  1984,  she was employed by  Diversified
Holdings Corporation.  From September 1981 to November 1983, she was employed by
Deloitte Haskins & Sells. Ms. Berkowitz, a Certified Public Accountant, received
a B.S. degree from Syracuse Univerity in 1981.

                             The L/WRC General Partner

The directors and officers of the L/WRC General Partner are as follows:

      Name                          Office
       <S>                            <C>
      Doreen D. Odell               President and Director

      Richard Paul Richman          Executive Vice President, Secretary,
                                      Treasurer and Director
</TABLE>

Ms.Odell's biography  is included  above under the Lehman  General  Partner.  
Mr. Richman's biography is included above under the WRC General Partner.


Item 11  Executive Compensation

The  Partnership  is not required to pay the officers,  directors or partners of
the General Partners any direct  compensation and no such  compensation was paid
during the fiscal year ended December 31, 1998.

                                       10


<PAGE>
<TABLE>
<CAPTION>



Item 12  Security Ownership of Certain Beneficial Owners and Management

     a) No person or group is known by the Partnership to be the owner of record
of more than 5% of the outstanding units as of December 31, 1998.

     b) Security ownership by the General Partners is as follows:

                                                            Percentage of
                                           Amount and        Outstanding
                                           Nature of           General
                                           Beneficial         Partners'
 Title of Class  Name of Beneficial Owner   Ownership         Interest*
     <S>                 <C>                  <C>                <C>
   General           Real Estate Equity       $3.33             33.3%
   Partners'           Partners L.P.
   Interest in
   Secured Income
   L.P.              Wilder Richman           $3.33             33.3%
                     Resources Corporation

                     WRC-87A Corporation      $3.34             33.4%

  *            General  Partners as a class have a 1% interest in all profits,
   losses and distributions of the Partnership.
</TABLE>
   An affiliate of Wilder  Richman  Resources  Corporation  filed a tender offer
dated  July 24,  1998,  offering  to  acquire  up to  394,000  Units of  limited
partnership  interest at $6.50 per Unit.  The offering price was increased to $7
per Unit on August 7, 1998 and the offer  expired,  as  extended,  on August 31,
1998.  40,961 Units were  tendered in  connection  with the offer,  representing
approximately 4.2% of the outstanding Units of limited partnership interest.

     c) Registrant  knows of no  arrangements  which may, at a subsequent  date,
result in a change of  control  of  Registrant.  Article  VI of the  Partnership
Agreement  describes the  circumstances  under which changes in General Partners
can occur.

     d) There is no family  relationship  between any of the foregoing directors
and executive officers.

     e) Involvement in certain legal  proceedings  with respect to the foregoing
directors and executive officers: None.

Item 13  Certain Relationships and Related Transactions with Management

The General  Partners  and their  affiliates  are  entitled  to receive  certain
compensation,  fees and  reimbursements  of expenses.  The Partnership  incurred
investor services fees in the amount of $98,437,  of which $84,349 is payable to
an  affiliate  of the General  Partners  for the year ended  December  31, 1998.
Information   regarding  such  compensation  is  set  forth  under  the  heading
"Compensation  And Fees To General  Partners And Affiliates" at pages 13 through
19 of the Prospectus, which is incorporated herein by reference.

The  financial  interests  in  Registrant  of the General  Partners  and Special
Limited  Partner  are  set  forth  under  the  heading   "Profits,   Losses  and
Distributions"  at pages 64 through 67 of the Prospectus,  which is incorporated
herein by reference.

The taxable loss generated by Registrant during the year ended December 31, 1998
allocated to each of the General Partners was approximately $200.

Transactions with Affiliates of Management

     Wilder Richman Management Corp.  ("WRMC"),  an affiliate of certain General
Partners,  is the managing agent of Fieldpointe  Apartments.  In connection with
these services, WRMC earned management and reporting fees of $89,958 in 1998.

Indebtedness of Management

No officer or director of the General Partners or any affiliate of the foregoing
was indebted to Registrant at any time during the fiscal year ended December 31,
1998.

                                       11

<PAGE>

                                      PART IV


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

(a)  1     Financial  Statements - The list of Financial  Statements appears 
           on page F-2.

     2     Schedules  -  All   schedules   are  omitted   because  the  required
           information is  inapplicable  or it is presented in the  consolidated
           financial statements or the notes thereto.

     3     Exhibits:

     3(A)  Form of Amended and  Restated  Agreement  of Limited  Partnership  of
           Secured  Income L.P.,  incorporated  by reference to Exhibit A to the
           Prospectus contained in the Partnership's  Registration  Statement on
           Form S-11 (No.
           33-9602) (the "Form S-11").

     3(B)  Certificate   of  Limited   Partnership   of  Secured   Income  L.P.,
           incorporated by reference to Exhibit 3(B) of Form S-11.

     10(A) Escrow   Agreement   between   Registrant  and  FirsTier  Bank  N.A.,
           incorporated by reference to Exhibit 10(A) of Form S-11.

     10(B) Carrollton Partnership Interest Acquisition  Agreement,  incorporated
           by reference to Exhibit 10(B) of Form S-11.

     10(C) Carrollton  Partnership  Agreement,  as amended,  and  guarantees  to
           certain   obligations  by  Carrollton   Developer   General  Partner,
           incorporated by reference to Exhibit 10(C) of Form S-11.

     10(D) Carrollton Property Management Agreement, as amended, incorporated by
           reference to Exhibit 10(D) of Form S-11.

     10(E) Fieldpointe Complex Financing Documents, incorporated by reference to
           Exhibit 10(B) of Form S-11.

     10(F) Form of Guaranteed Investment Contract Escrow Agreement, incorporated
           by reference to Exhibit 10(F) of Form S-11.

     10(G) Columbia Partnership Interest Acquisition Agreement,  incorporated by
           reference to Exhibit 10(G) of Form S-11.

     10(H) Columbia  Partnership  Agreement and guarantee of certain obligations
           of Columbia  Developer General Partner,  incorporated by reference to
           Exhibit 10(H) of Form S-11.

     10(I) Columbia Property Management Agreement,  incorporated by reference to
           Exhibit 10(I) of Form S-11.

     10(J) Columbia  Construction  and  Development  Agreement,  incorporated by
           reference to Exhibit 10(J) of Form S-11.

     10(K) Westmont Complex  Financing  Documents,  incorporated by reference to
           Exhibit 10(K) of Form S-11.

     10(L) Westmont Complex Financing Restructuring  Agreement,  incorporated by
           reference to Form 10-K for fiscal year ended December 31, 1992.

     10(M) Columbia   Partnership   Cost-Sharing  and  Indemnity   Agreement  in
           connection  with  the  mortgage  modification  dated  May  27,  1993,
           incorporated by reference to Form 10-K for fiscal year ended December
           31, 1993.

     10(N) Amendment of Partnership  Agreement of Columbia Partnership dated May
           27,  1993,  incorporated  by  reference  to Form 10-K for fiscal year
           ended December 31, 1993.

     10(O) Amendment of Guaranty Agreement of Columbia Partnership dated May 27,
           1993,  incorporated  by  reference to Form 10-K for fiscal year ended
           December 31, 1993.

                                       12

<PAGE>

     10(P) Columbia   Partnership   Financing  Agreement  dated  May  27,  1993,
           incorporated by reference to Form 10-K for fiscal year ended December
           31, 1993.

     10(Q) Carrollton  Partnership  Assignment and Modification of Deed of Trust
           dated  August 30,  1993,  incorporated  by reference to Form 10-K for
           fiscal year ended December 31, 1993.

     (25)  Power of Attorney, incorporated by reference to Exhibit 25 of 
           Form S-11.

     (28)  Market   Analysis  dated   February  1,  1985  of  REDE   Associates,
           incorporated by reference to Exhibit 28 of Form S-11.


Other Exhibits

(b)        Reports on Form 8-K

No  reports on Form 8-K were filed  during the last  quarter of the fiscal  year
ended December 31, 1998.

                                       13

<PAGE>




                                    SIGNATURES



      Pursuant  to the  requirements  of Section  13 or 15(d) of the  Securities
Exchange Act of 1934, Registrant has duly caused this report to be signed on its
behalf by the  undersigned,  hereunto duly  authorized on the 31st day of March,
1999.


                     SECURED INCOME L.P.

                     By:  Wilder Richman Resources Corporation, General Partner

                          By:  /s/Richard Paul Richman
                               Richard Paul Richman - President

                     By:  Real Estate Equity Partners L.P., General Partner
                          Real Estate Equity Partners Inc.

                          By:  /s/Doreen D. Odell
                               Doreen D. Odell - President

                     By:  WRC-87A Corporation, General Partner

                          By:  /s/Doreen D. Odell
                               Doreen D. Odell - President

                                       14

<PAGE>




                      CONSOLIDATED FINANCIAL STATEMENTS AND
                           INDEPENDENT AUDITORS' REPORT

                       SECURED INCOME L.P. AND SUBSIDIARIES

                         DECEMBER 31, 1998, 1997 AND 1996


<PAGE>
<TABLE>
<CAPTION>



                        SECURED INCOME L.P. AND SUBSIDIARIES

                     INDEX TO CONSOLIDATED FINANCIAL STATEMENTS




<S>                                                             <C>

Table of Contents                                               Page

Independent Auditors' Report                                     F-3


Consolidated Financial Statements


   Consolidated Balance Sheets                                   F-4


   Consolidated Statements Of Operations                         F-5


   Consolidated Statements Of Partners' Deficit                  F-6


   Consolidated Statements Of Cash Flows                         F-7


   Notes To Consolidated Financial Statements                    F-8

</TABLE>

                                        F - 2


<PAGE>

                                    


                            INDEPENDENT AUDITORS' REPORT



      To the Partners
      Secured Income L.P. and Subsidiaries

            We have audited the  consolidated  balance  sheets of Secured Income
      L.P. and  Subsidiaries  as of December 31, 1998 and 1997,  and the related
      consolidated  statements of operations,  partners'  deficit and cash flows
      for each of the three years  ended  December  31,  1998.  These 
      Consolidated financial
      statements are the  responsibility  of the partnership's  management.  Our
      responsibility  is to express an  opinion  on these  
      consolidated financial  statements based on our audits.

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

            In our opinion,  the consolidated  financial  statements referred to
      above present fairly, in all material respects,  the financial position of
      Secured Income L.P. and Subsidiaries as of December 31, 1998 and 1997, and
      the results of their  operations,  changes in their partners'  deficit and
      their cash flows for each of the three years ended  December
      31, 1998, in conformity with generally accepted accounting principles.




                                  By:  /s/ Reznick Fedder & Silverman

      Bethesda, Maryland
      March 16, 1999

                                      F-3

<PAGE>
<TABLE>
<CAPTION>


                        SECURED INCOME L.P. AND SUBSIDIARIES

                            CONSOLIDATED BALANCE SHEETS
                             DECEMBER 31, 1998 AND 1997





                                  Notes             1998              1997
                              ------------   ----------------     ------------

<S>                                <C>             <C>                <C>
ASSETS

Property and equipment, 
net of accumulated
  depreciation                     3,6        $ 28,285,988       $  29,708,923

Cash and cash equivalents         9,11           1,885,257           1,317,457
Restricted assets and 
funded reserves                  5,6,11          3,944,319           4,280,585
Tenant security deposits                           490,656             466,609
Investment in guaranteed 
investment contract               2,11                                  19,499
Interest and accounts receivable   11               71,081              91,297

Prepaid expenses                                   563,130             437,833

Intangible assets, net of 
accumulated amortization           4             1,718,523           1,826,991

                                             $  36,958,954       $  38,149,194


LIABILITIES AND PARTNERS' DEFICIT

Liabilities

   Mortgages payable              6,9        $  33,973,813       $  34,449,756
   Accounts payable and
   accrued expenses                                122,888             395,028

  Tenant security deposits 
     payable                                       490,116             460,182

  Due to general partners
     and affiliates                7             3,865,581           4,109,214
  Deferred revenue                                 140,460             152,414
                                          ----------------      ---------------

                                                38,592,858          39,566,594


Commitments and contingencies   6,7,9

Partners' deficit                 8

  Limited partners 
     (984,369 units issued 
     and outstanding)                                 -                      -
  General partners                              (1,633,904)         (1,417,400)
                                            --------------     ---------------

                                                (1,633,904)        (1,417,400)


                                             $  36,958,954      $  38,149,194
                                             =============      =============


</TABLE>









                  See notes to consolidated financial statements.

                                      F-4

<PAGE>
<TABLE>
<CAPTION>

                        SECURED INCOME L.P. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF OPERATIONS
                    YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996





                        Notes             1998         1997         1996
                     ------------    ------------  ------------  -----------

<S>                      <C>             <C>            <C>             <C>
REVENUE

Rental                               $ 6,830,701   $ 6,584,435   $6,227,870
Interest                                 204,262       174,393      169,896
Other                                     43,436        28,333       36,932

TOTAL REVENUE                          7,078,399     6,787,161    6,434,698
                                    ------------  ------------    ---------


EXPENSES

Administration and 
management                7              747,937       702,416      774,264
Operating and maintenance              1,144,623     1,232,640    1,060,253
Taxes and insurance                    1,335,198       971,805      891,180
Financial               6,7            2,305,697     2,692,516    1,764,812
Depreciation and
  amortization          3,4            1,761,448     1,784,057    2,013,710
                                    -------------  ------------  ----------

TOTAL EXPENSES                         7,294,903     7,383,434    6,504,219
                                   -------------  ------------  -----------

NET LOSS                            $   (216,504)   $ (596,273)  $  (69,521)
                                    ============  ============   ==========



NET LOSS ATTRIBUTABLE TO

  General partners       8           $ (216,504)   $  (596,273)  $   (69,521)
  Limited partners       8                   -              -            -
                                  -------------    -----------  -----------


                                   $   (216,504)   $  (596,273) $   (69,521)
                                   ============   ============   ==========

NET LOSS ALLOCATED PER UNIT
   OF LIMITED PARTNERSHIP
   INTEREST              8          $       -          $     -     $      -
                                      =======       ============   ========


Weighted number of 
units outstanding                      984,369          984,369    984,369



</TABLE>






                   See notes to consolidated financial statements.

                                      F-5

<PAGE>
<TABLE>
<CAPTION>


                        SECURED INCOME L.P. AND SUBSIDIARIES

                    CONSOLIDATED STATEMENTS OF PARTNERS' DEFICIT
                    YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996





                                                          Limited      General
                                            Total        partners     partners

<S>                                         <C>             <C>         <C>
Partners' deficit, 
December 31, 1995                     $   (751,606)     $       -   $  (751,606)

Net loss                                   (69,521)             -       (69,521)
                                    ---------------    -----------   ----------

Partners' deficit, December 31, 1996       (821,127)            -      (821,127)

Net loss                                   (596,273)            -      (596,273)
                                     -------------- -------------  -------------

Partners' deficit, December 31, 1997     (1,417,400)            -    (1,417,400)

Net loss                                   (216,504)            -      (216,504)
                                     -------------- ------------- --------------

Partners' deficit, December 31, 1998   $ (1,633,904)$           -  $ (1,633,904)
                                       ============ ============    ===========


</TABLE>








                  See notes to consolidated financial statements.
                                      F-6

<PAGE>
<TABLE>
<CAPTION>


                        SECURED INCOME L.P. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                    YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996


                                               1998          1997        1996
                                        -----------     ----------   ---------
<S>                                          <C>              <C>         <C>
 CASH FLOWS FROM OPERATING ACTIVITIES

Net loss                                 $ (216,504)    $ (596,273)  $ (69,521)

Adjustments to reconcile net loss 
   to net cash provided
   by operating activities
       Depreciation and amortization      1,761,448      1,784,057   2,013,710

     Decrease (increase) in restricted
       assets and funded reserves           336,266         41,539   (834,186)

       Increase in tenant security 
         deposits                           (24,047)       (15,208)   (26,931)

       Decrease (increase) in interest
         and accounts receivable             20,216        (24,203)    (9,235)
       Decrease (increase) in prepaid 
         expenses                          (125,297)      (302,099)   289,779

       Decrease (increase) in intangible 
         assets                             (35,197)        20,000    (20,000)
       Decrease (increase) in other assets                  34,708    (34,708)
       Increase (decrease) in accounts payable
         and accrued expenses              (293,927)       158,137    (11,418)

       Increase in tenant security
         deposits payable                    29,934          8,781     29,455

       Increase in due to general 
         partners and affiliates             56,367        138,936    195,794
       Decrease in deferred revenue         (11,954)       (11,954)   (11,954)
                                       --------------  -----------  ----------


Net cash provided by operating activities 1,497,305      1,236,421  1,510,785
                                       ------------      ---------  ---------


CASH FLOWS FROM INVESTING ACTIVITIES

Principal proceeds from guaranteed 
 investment contract                         19,499        73,086      65,809
Capital expenditures                        (72,815)      (17,674)   (187,733)
                                      -------------    ----------  ----------


Net cash provided by (used in) 
  investing activities                      (53,316)      55,412     (121,924)
                                      -------------  -----------     --------

 CASH FLOWS FROM FINANCING ACTIVITIES

 Payments of principal on 
   permanent financing                     (475,943)   (870,809)   (1,268,655)

 Payment of mortgage costs                 (100,246)
 Repayment of general partner advances     (300,000)


Net cash used in financing activities      (876,189)  (870,809)    (1,268,655)
                                        -------------     --------  ----------

NET INCREASE IN CASH AND CASH
   EQUIVALENTS                              567,800    421,024        120,206


Cash and cash equivalents at
  beginning of year                       1,317,457    896,433        776,227
                                     --------------  ------------  -----------


CASH AND CASH EQUIVALENTS AT
  END OF YEAR                           $ 1,885,257 $1,317,457     $  896,433
                                        =========== ===========     ==========


SUPPLEMENTAL INFORMATION

Financial expenses paid                   $ 2,365,523  $ 2,259,546   $ 1,471,566
                                          ===========  ===========   ===========


</TABLE>



                  See notes to consolidated financial statements.

                                      F-7

<PAGE>



                        SECURED INCOME L.P. AND SUBSIDIARIES

                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          DECEMBER 31, 1998, 1997 AND 1996


Note 1 - Organization and Summary of Significant Accounting Policies

Secured  Income L.P. (the  "Partnership"),  was formed on October 10, 1986 under
the Revised  Uniform  Limited  Partnership  Act of the State of Delaware for the
purpose of acquiring real estate limited partnership interests.  The Partnership
filed a Form  S-11  registration  statement  with the  Securities  and  Exchange
Commission  effective  March 5, 1987  covering an  offering  of up to  2,500,000
limited  partnership  units at $20 per unit.  The admission of limited  partners
occurred on October 9, 1987 (at which time operations  commenced),  December 18,
1987 and April 12, 1988.

Carrollton X Associates Limited  Partnership  ("Carrollton") was organized under
the laws of the  District of  Columbia  on December  18, 1985 for the purpose of
constructing and operating a residential  rental  apartment  complex and related
facilities  under Section  221(d)4 of the National  Housing Act. The Partnership
acquired a 98.9% limited  partner  interest in  Carrollton in October 1987.  The
complex consists of 252 units located in Frederick,  Maryland and operates under
the name of Fieldpointe Apartments.

Columbia Associates ("Columbia") was formed as a limited partnership on February
6, 1985 to acquire an interest in real  property  located in New York,  New York
and to construct  and operate  thereon a 163 unit  apartment  complex which also
includes a parking  garage and  approximately  9,400  square feet of  commercial
space. The Partnership  acquired a 98.9% limited partner interest in Columbia in
December 1988. The complex operates under the name of The Westmont.

Columbia and Carrollton have  underlying  mortgages which qualify for tax-exempt
financing as a result of restricting at least 20% of their  apartment  units for
low to moderate income tenants as defined in applicable guidelines.

Principles of Consolidation

The  consolidated  financial  statements  include  the assets,  liabilities  and
results  of  operations  which  relate  to  the  business  of  the  Partnership,
Carrollton  and  Columbia.  All  significant   inter-partnership   balances  and
transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

Property, Equipment and Depreciation

Land,  buildings  and  improvements  are  carried  at the  lower  of cost or net
realizable value. Net realizable value represents the net cash flow necessary to
recover costs exclusive of debt service. Depreciation is provided for in amounts
sufficient to relate the cost of  depreciable  assets to  operations  over their
estimated service lives by use of the straight-line  method over a 25-year life.
Personal  property  is carried  at cost and is  depreciated  over its  estimated
service  life of 5-7 years  using the  straight-line  method.  Improvements  are
capitalized,  while  expenditures  for  maintenance  and  repairs are charged to
expense as incurred.  Upon disposal of  depreciable  property,  the  appropriate
property accounts are reduced by the related costs and accumulated  depreciation
and the resulting gains or losses are reflected in the  consolidated  statements
of operations.

Other Assets and Amortization

Mortgage costs are amortized  over the terms of the  respective  loans using the
effective interest method.  Acquisition fees are amortized over the useful lives
of the respective property and equipment using the straight-line method. Leasing
costs are amortized over the period of the applicable  leases which range from 5
to 12 years using the straight-line method.

                                      F-8

<PAGE>



                                      




                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 1 - Organization and Summary of Significant Accounting Policies (continued)

Deferred Revenue

Deferred  revenue  consists of a fee received by Columbia for the extension of a
parking  garage  lease  which  expires  September  30,  2011.  Such fee is being
accreted to revenue over the lease term.

Leases

Tenant leases are treated as operating  leases.  Rental revenue is reported when
earned and expenses are charged to operations as incurred.

Interest Revenue

Interest  earned  on the  guaranteed  investment  contract  has been  recognized
utilizing the effective interest method.

Income Taxes

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

Cash and Cash Equivalents

The  Partnership  considers  all  highly  liquid  investments  with an  original
maturity  of  three  months  or  less  at the  date  of  acquisition  to be cash
equivalents.

Net Loss per Unit of Limited Partnership Interest

Net loss per unit of limited  partnership  interest is calculated based upon the
weighted  average  number of units  outstanding,  984,369  for each of the years
1998, 1997 and 1996. Losses are allocated to limited partners until such time as
the limited partners' equity reaches zero.

Adoption of Accounting Standards

The Partnership has adopted Statement of Financial  Accounting Standard ("SFAS")
No. 130, "Reporting  Comprehensive  Income." SFAS No. 130 establishes  standards
for reporting and display of comprehensive  income and its components  (revenue,
expenses,  gains and losses) in the financial  statements  and requires that all
such items  required to be recognized as components of  comprehensive  income be
reported and  displayed  with the same  prominence  as items in other  financial
statements.  The adoption of SFAS No. 130 has had no impact on the Partnership's
consolidated financial statements.

The  Partnership  has adopted SFAS No. 131,  "Disclosures  about  Segments of an
Enterprise and Related  Information," which establishes  standards for reporting
information about operating segments and related  disclosures about products and
services,  geographic  areas  and major  customers.  The  Partnership  is in one
business segment and follows the requirements of SFAS No.131.

Note 2 - Guaranteed Investment Contract

In  order  to  provide  investor  limited  partners  with a 7%  guaranteed  cash
distribution  through December 31, 1993 and to pay investor  services fees for a
prescribed period, the Partnership  purchased  guaranteed  investment  contracts
upon each admission of limited partners. Proceeds from the guaranteed investment
contracts were comprised of principal and interest such that the balances of the
guaranteed  investment  contracts  were fully  amortized  upon the expiration of
their respective terms.


                                      F-9


<PAGE>
<TABLE>
<CAPTION>


                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 2 - Guaranteed Investment Contract (continued)

In connection with the Partnership's  investment in Carrollton,  the Partnership
purchased  guaranteed  investment  contracts  to provide  Carrollton's  pro rata
portion of the 7% cash distributions  through December 31, 1993. Such guaranteed
investment  contracts expired on January 15, 1994 and were then fully amortized.
In connection  with the  Partnership's  investment in Columbia,  the Partnership
purchased  guaranteed  investment contracts sufficient to provide Columbia's pro
rata  portion of the 7% cash  distributions  through  December  31, 1993 with an
additional  guaranteed  investment  contract  being  utilized  to provide a cash
distribution for the year ended December 31, 1994 and to pay Columbia's investor
services fee (see Note 7) through  December 31, 1997.  The remaining  guaranteed
investment contract provided for annual distributions of $80,072 for the payment
of Columbia's investor services fee and expired on January 15, 1998.

Note 3 - Property and Equipment

Property  and  equipment  as of  December  31, 1998 and 1997 are  summarized  as
follows:

                                                    1998            1997
                                             ------------------------------
     <S>                                            <C>              <C>
      Land                                   $   6,057,940    $   6,057,940

      Buildings and improvements                36,623,572       36,573,381

      Furniture and equipment                    1,619,202        1,574,791
                                            --------------   --------------


                                                44,300,714       44,206,112

      Less accumulated depreciation             16,014,726       14,497,189
                                             -------------    -------------


                                              $ 28,285,988     $ 29,708,923
                                              ============     ============



Depreciation  for the  years  1998,  1997 and 1996 was  $1,517,537, 
 $1,537,334  and  $1,527,885 respectively.


Note 4 - Intangible Assets

Intangible assets as of December 31, 1998 and 1997 are summarized as follows:

                                                     1998             1997
                                             -----------------------------

      Acquisition fees                        $    787,495     $    787,495

      Mortgage costs                             4,861,818        4,761,572

      Leasing costs                                255,656          220,459
                                             -------------    -------------


                                                 5,904,969        5,769,526

      Less accumulated amortization              4,186,446        3,942,535
                                              ------------     ------------


                                               $ 1,718,523      $ 1,826,991
                                               ===========      ===========

</TABLE>

Amortization  for  the  years  1998,  1997  and  1996  was  $243,911,  
$246,723  and $485,825, respectively.

                                      F-10

<PAGE>
<TABLE>
<CAPTION>
                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 5 - Restricted Assets and Funded Reserves

Restricted  assets and funded  reserves  (see Note 6) as of  December  31,  
1998 and 1997 are summarized as follows:

                                                     1998            1997
                                             ----------------------------
          <S>                                       <C>              <C>
       Escrows held by mortgage lenders       $    430,025     $    553,767

       Pledged cap account                       2,765,571        2,193,213
       Operating deficit reserve                   502,474          500,000

       Bond retirement escrow                      246,249           33,605
       Call premium collateral                                    1,000,000
                                       -------------------     ------------


                                               $ 3,944,319      $ 4,280,585
                                               ===========      ===========


Note 6 - Mortgages Payable

Carrollton

On December  18,  1985,  Carrollton  executed a note (the  "Original  Carrollton
Mortgage")  with Concord  Mortgage  Company,  an  affiliate  of certain  general
partners  of  Carrollton.  The  Original  Carrollton  Mortgage  in the amount of
$10,494,100 was financed through  tax-exempt revenue bonds issued by the City of
Frederick,  Maryland and was insured by the United States  Department of Housing
and Urban Development  ("HUD").  The Original Carrollton Mortgage was refinanced
during 1993 (see discussion below).  Under the terms of the Original  Carrollton
Mortgage,  principal and interest  payments  were payable in successive  monthly
installments of $85,009 through February 1, 2028, bearing interest at 9.5%.

On August 30, 1993, the Original Carrollton Mortgage was modified and refinanced
through a 1993 series  mortgage  revenue  bond issued by the City of  Frederick,
Maryland.  The note was modified by reducing  the interest  rate from 9.5% to 8%
for the period  August  31,  1993  through  June 30,  1994,  then 6.09% per year
through  maturity in  February  2028.  The  modified  terms  include the monthly
payment of  principal  and interest of $74,734 from October 1, 1993 through July
1,  1994  and  $60,900  from  August  1,  1994  through  maturity.  The  note is
collateralized  by the underlying value of the real estate plus other amounts on
deposit with the lender. Pursuant to agreements,  Carrollton is required to make
monthly escrow deposits for taxes,  insurance and replacement of project assets,
and is  subject  to  restrictions  as to  operating  policies,  rental  charges,
operating  expenditures  and  distributions  to  partners.  The  balance  of the
mortgage  payable at December 31, 1998 and 1997 is $9,959,661  and  $10,079,919,
respectively.

Columbia

The  original  financing  of Columbia  was provided by the New York City Housing
Development  Corporation  ("HDC") which issued  $32,497,691 of bonds in February
1985.  The funds  provided by the bond issue were loaned to Columbia in the form
of two mortgage loans (the "Original  Columbia  Mortgages").  In connection with
the  issuance  of such bonds,  Citibank,  N.A.  ("Citibank")  issued a letter of
credit in the  amount of  $33,018,629  to  guarantee  payment of  principal  and
interest on the bonds. The Original Columbia Mortgages were modified during 1993
(see  discussion  below).  Under the terms of the Original  Columbia  Mortgages,
interest was payable at the rate of 9.58% per annum. Principal and interest were
payable in monthly installments of $260,256 over a period of 23 years.

On May 27, 1993,  the Original  Columbia  Mortgages were modified (the "Modified
Columbia Mortgages").  Under the terms of the Modified Columbia Mortgages, based
on the issuance of new  tax-exempt  bonds (which bear a floating  interest rate,
adjusted  weekly),  with an initial note rate of 4.66%,  with  required  monthly
principal amortization of $29,367. Pursuant to agreements,  any savings realized
on the difference between the 4.66% initial note rate and the actual low floater
rate (approximately  3.23% and 3.56% weighted average rate during 1998 and 1997,
respectively)  were to be  deposited  in an  account to be used to  purchase  an
interest  rate cap (the  "Pledged Cap  Account") by October  1996.  The Columbia
general  partners had been  conducting  discussions  with the lender in order to
address other potential uses of such account, including utilizing such funds for
costs in connection  with a potential  refinancing of the mortgages with another
lender.  During April 1998, the lender agreed to restructure  the original terms
concerning  the  Pledged Cap  Account  whereby  the account may be utilized  for
potential  debt service  shortfalls (in the event the low floater rate is higher
than the stated  note rate of 4.66%),  but not cause the  Pledged Cap Account to
decline
</TABLE>
                                      F-11

<PAGE>




                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 6 - Mortgages Payable (continued)

below a balance of  $1,000,000.  An interest rate cap may be purchased  upon the
Pledged Cap Account  reaching  such  minimum  threshold  or in the event the low
floater rate rises above 7% for 90  consecutive  days or 7.5% for 30 consecutive
days. In addition,  the lender agreed to eliminate  and reduce  certain  partner
guarantees,   thereby  releasing  certain  restricted  assets  of  approximately
$1,000,000 (see discussion  below), of which $300,000 was repaid to the Columbia
general  partners  (see Note 7).  The  balance  in the  Pledged  Cap  Account is
$2,765,571  and $2,193,213 as of December 31, 1998 and 1997,  respectively  (see
Note 5).  Pursuant  to  agreements,  Columbia is subject to  restrictions  as to
operating policies, rental charges,  operating expenditures and distributions to
partners.  The balance of the mortgages payable as of December 31, 1998 and 1997
is $24,014,152 and $24,369,837,  respectively.  The weighted average low floater
rate for the period January 1, 1999 through February 28, 1999 was  approximately
2.34%.

The Modified Columbia  Mortgages further provide that any cash flow generated by
Columbia above the note rate, servicing fees and principal  amortization will be
applied first to fund and maintain an interest-bearing operating deficit reserve
account (the  "Operating  Deficit  Reserve")  until it  accumulates to $500,000.
Thereafter,  such cash flow will be deposited into the Operating Deficit Reserve
to the  extent  necessary  to  maintain a balance  of  $500,000  and then into a
segregated  account  to be  used to  retire  the  underlying  bonds  (the  "Bond
Retirement  Escrow") at the earliest possible dates in minimum  denominations of
$100,000 in excess of the  scheduled  principal  amortization  of  approximately
$352,000 per annum.  Amounts  deposited in the  Operating  Deficit  Reserve will
generally be utilized to fund operating deficits,  pay for maintenance,  repairs
and  replacements  and to pay debt service and other  amounts due under the loan
documents.  As of  December  31,  1998 and 1997,  the  balance in the  Operating
Deficit Reserve is $502,474 and $500,000,  respectively (see Note 5). During the
years ended December 31, 1998 and 1997,  deposits of approximately  $213,000 and
$252,000,  respectively,  were made to the Bond Retirement Escrow, with $400,000
utilized to  accelerate  the  retirement of the debt in 1997. As of December 31,
1998 and  1997,  the  balance  in the Bond  Retirement  Escrow is  $246,249  and
$33,605, respectively (see Note 5).

Because the bonds issued in connection with the Original Columbia Mortgages were
redeemed  voluntarily,  Columbia was required to pay a prepayment premium in the
amount  of  $1,590,658  (the  "Call  Premium").  Columbia  paid for the costs of
issuance of the new bonds, including the Call Premium, from the premium realized
upon  liquidation of a debt service  reserve held by Citibank in connection with
the  Original  Columbia  Mortgages  and, to the extent  necessary,  amounts were
provided  by  the  Columbia  general  partners  under  their  operating  deficit
guarantee to  Columbia.  As a result of  utilizing  such debt  service  reserve,
Citibank  required  the  partners of Columbia  (including  the  Partnership)  to
provide  Citibank  with letters of credit in the full amount of the Call Premium
(the "Call Premium  Letters of Credit").  In order to establish the Call Premium
Letters of Credit,  the Columbia  general partners  provided  $900,000 (of which
$600,000  was in the form of letters of credit and  $300,000 was advanced to the
Partnership)  and the  Partnership  provided  a letter  credit in the  amount of
$1,000,000 (inclusive of the $300,000 advance) (collectively,  the "Call Premium
Collateral").  The Call  Premium  Letters  of  Credit  were to be  available  to
Citibank  upon  sale or  refinancing  (or an  event  of  default)  in the  event
available  proceeds were not sufficient to pay in full all amounts due under the
bonds or accrued  and unpaid  Citibank  letter of credit  fees (see  below).  In
connection  with the  modification  of the terms of the Pledged Cap Account (see
discussion  above) the Call Premium Letters of Credit were released by Citibank.
However,  Citibank  will be  entitled  to draw first upon the  Columbia  general
partners' guaranty of payment (in the amount of approximately $1,690,000) to pay
any unpaid letter of credit fee (see discussion below). As of December 31, 1997,
$1,000,000 was invested in interest  bearing deposits which served as collateral
for the Partnership's Call Premium Letter of Credit (see Note 5). The letters of
credit in the amount of $600,000  which were  provided  directly by the Columbia
general  partners  as  described  above are not  reflected  in the  accompanying
consolidated balance sheet as of December 31, 1997.

As part of the mortgage  modification,  Citibank  agreed to extend its letter of
credit from February 1997 to February 2003. Beginning February 1, 1997, Citibank
is entitled to a letter of credit fee for providing  credit  support for the new
bonds in the amount of 2.5% per annum of the  outstanding  principal  balance of
the new bonds,  payable on a current or  deferred  basis at  Columbia's  option.
Except as described  above,  the obligation to pay the letter of credit fee will
be with full recourse as to the assets of Columbia,  but without recourse to any
of the partners,  including the Partnership.  If the letter of credit fee is not
fully paid from  available  proceeds from the sale or refinancing of Columbia or
the Columbia  general  partners'  guaranty of payment,  any such unpaid  balance
shall be deemed fully  discharged  and neither  Columbia nor its partners  shall
have any further  obligation with respect thereto.  For the years ended December
31,  1998 and 1997,  Columbia  incurred a fee in  connection  with the  Citibank
letter of credit in the amount of $627,694 and $583,229, respectively, which fee
is being paid currently on a monthly basis.

                                      F-12

<PAGE>
<TABLE>
<CAPTION>


                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 6 - Mortgages Payable (continued)

Aggregate annual mandatory  maturities on the Carrollton and Columbia  Mortgages
as of December 31, 1998 are as follows:

                      <S>                        <C>
                      1999             $       480,188
                      2000                     488,192
                      2001                     496,696
                      2002                     505,733
                      2003                   1,388,336
                   Thereafter               30,614,668

                                          $ 33,973,813

The carrying amount of the mortgages approximates fair value.

Note 7 - Related Party Transactions

Due to general partners and affiliates as of December 31, 1998 and 1997 consists
of cash advances and other payables as follows:
          <S>                                              <C>           <C>
                                                           1998         1997
                                                   ---------------------------

      Carrollton general partners and their affiliates$   65,154      $ 65,154

      Columbia general partners and their affiliates
        (including accrued interest of $1,302,712
        and $1,126,066)                                3,033,392     3,156,746
      Wilder Richman Management Corp.                    201,597       201,600

      WRC-87A Corporation                                565,438       685,714
                                                   ------------- -------------


                                                     $ 3,865,581   $ 4,109,214
                                                     ===========   ===========


The management  agent for  Fieldpointe  Apartments is Wilder Richman  Management
Corp. ("WRMC"),  an affiliate of one of the Carrollton general partners.  During
each of the three years ended  December 31, 1998,  WRMC was entitled to property
management fees equal to 4% of residential income collected.  In addition,  WRMC
was  entitled to a reporting  fee of $5 per unit per month for  bookkeeping  and
reporting  services.  The maximum  annual  management and reporting fees may not
exceed 5% of gross collections.  Such fees of $89,958,  $86,040 and $83,958 were
charged  to  operations  during  1998,  1997  and  1996,  respectively.  Accrued
management  and reporting  fees as of December 31, 1998 and 1997 are $35,597 and
$35,600, respectively.

The  management  agent for The  Westmont is an  affiliate of one of the Columbia
general  partners and receives  property  management fees calculated at 3.01% of
rental  income for 1998 and at the greater of 2% of rental income or $70,000 for
1997 and 1996.  The  charges to  operations  amounted to  $146,837,  $89,332 and
$84,240 during 1998, 1997 and 1996, respectively.

WRC-87A  Corporation,  a general partner of the  Partnership,  is entitled to an
annual investor services fee which is incurred by Columbia and Carrollton in the
amounts of $80,072 and $18,365,  respectively,  and which is based on .5% of the
gross  proceeds from the offering of  Partnership  units  allocable to each such
investment.  The fee is payable  quarterly  from cash flow and shall be adjusted
annually by increases in the Consumer  Price Index.  To the extent that there is
insufficient  cash flow  available to pay the investor  services fee, the fee is
payable only from distributions from the guaranteed investment contracts,  which
expired on January 15, 1994 and  January 15, 1998 in the case of  Carrolton  and
Columbia,  respectively.  The  consolidated  statements  of  operations  include
charges to  operations  for the investor  services  fee of $98,437,  $80,072 and
$98,437 in 1998, 1997 and 1996, respectively.  These amounts are paid or payable
to WRC-87A  Corporation  to the extent that such services are not provided by an
independent third party.  Amounts payable to WRC-87A  Corporation as of December
31, 1998 and 1997,  representing the unpaid investor  services fee for the year,
were $84,349 and $65,873, respectively. The Partnership paid WRC-87A Corporation
$265,000 during 1998 for investor services fees incurred in prior years.
</TABLE>

                                      F-13

<PAGE>

                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 7 - Related Party Transactions (continued)

The sole  shareholder of an affiliate of one of the Carrollton  general partners
provided  debt  financing  for the  capitalization  of LaMere  Associates,  Inc.
("LaMere"). In connection with such debt financing, the shareholder received 20%
of the stock of LaMere.  LaMere was paid premiums in connection  with  property,
workers  compensation,  liability and umbrella  insurance  coverage  provided to
Carrollton.  In connection  with such insurance  coverage,  Carrollton  incurred
$41,359,  $45,864 and $47,303 in premiums for the years ended December 31, 1998,
1997 and 1996, respectively.

During 1998 and 1997,  Columbia paid an affiliate a fee of $60,750 and $183,750,
respectively,  for services  rendered in connection with the modification of the
terms  of the  Pledged  Cap  Account  (see  Note  6) and an  attempted  mortgage
refinancing,  respectively.  During 1998 and 1996,  Columbia  incurred  and paid
$43,121 and $20,779,  respectively,  in connection with repair services provided
by an affiliate of one of its general partners.

Pursuant to an operating  deficit  guarantee  agreement dated December 21, 1988,
the Columbia general partners  guaranteed to loan to Columbia any funds required
to satisfy its operating deficits, if any, up to $2,000,000.  As of December 31,
1998 and 1997, loans of $1,700,680 and $2,000,680,  respectively, remain payable
by Columbia.  The loans, with the exception of $300,000 as of December 31, 1997,
bear interest at Chase  Manhattan  Bank's prime rate plus 2% (10.25% at December
31, 1998) in accordance with the terms of the Columbia partnership agreement. In
connection  with the  modification  of the terms of the Pledged Cap Account (see
Note 6), $300,000 was repaid to the Columbia  general  partners during 1998. The
amount  of  interest  charged  to  operations  during  1998,  1997  and 1996 was
$176,646, $177,634 and $174,731,  respectively.  Accrued interest as of December
31, 1998 and 1997 is $1,302,712  and  $1,126,066,  respectively.  Such loans are
repayable from Columbia cash flow, subject to the terms of the Modified Columbia
Mortgages.

Columbia is  obligated in the amount of $30,000 as of December 31, 1998 and 1997
to  certain  of  its  partners  for  development  advances.   The  advances  are
non-interest bearing, unsecured and due on demand.

Carrollton  owes WRMC $166,000 as of December 31, 1998 and 1997 for prior years'
operating  advances.  Carrollton  also owes its general  partners and affiliates
$65,154 as of December 31, 1998 and 1997 for various advances. All such advances
are unsecured, non-interest bearing and payable from Carrollton cash flow.

Management  believes it is not  practicable  to  estimate  the fair value of the
loans and advances from related  parties because loans and advances with similar
characteristics  are not currently  available to the  Partnership,  Columbia and
Carrollton.


Note 8 - Partners' Deficit

Partnership Allocation

Profits and losses of the  Partnership  are  allocated 1% and 99% to the general
partners  and  limited  partners,  respectively,  until such time as the limited
partners'  capital  reaches  zero,  after which all losses are  allocated to the
general partners.

Partnership Distributions

In accordance  with the respective  partnership  agreements,  to the extent that
Carrollton and Columbia  generate net operating cash flow in any year at a level
sufficient,  when distributed to the  Partnership,  to enable the Partnership to
satisfy the allocable  portion of the limited  partners' 8% preferred return for
such year without  utilizing  amounts  generated from the guaranteed  investment
contracts, the excess amounts generated from the guaranteed investment contracts
would be paid or  distributed  to the  general  partners  of  Carrollton  and/or
Columbia,  whichever  generate(s)  such level(s) of operating cash flow. No such
excess distributions were generated during the term of the guaranteed investment
contract periods (see Note 2). Due to restrictions concerning distributions from
operating  cash flow of Columbia (see Note 6), there were no cash  distributions
from Columbia in 1998 and 1997.

                                      F-14

<PAGE>
<TABLE>
<CAPTION>


                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996


Note 9 - Commitments and Contingencies

Long-term Leases

The commercial  space and parking garage at Columbia are leased to tenants under
the terms of  noncancellable  operating leases expiring on various dates through
September 30, 2011.  Future minimum rental  payments as of December 31, 1998 are
as follows:
                              <S>                    <C>
                             1999              $    695,000
                             2000                   680,000
                             2001                   526,000
                             2002                   544,000
                             2003                   475,000
                         Thereafter               3,262,000

                                                $ 6,182,000

Income recognized under the garage and commercial space for the years 1998, 1997
and 1996 was $692,983, $758,473 and $716,277, respectively.

Lender Restrictions and Requirements

Carrollton  and  Columbia  are  subject  to  various  lender   requirements  and
restrictions,  including  (i) the  rental of not less  than 20% of the  dwelling
units to individuals or families who qualify as low or moderate  income tenants;
(ii) restrictions on the sale of the apartment complexes; and (iii) restrictions
on the amount of cash flow which may be distributed to the partners.

Concentration of Credit Risk

As of  December  31,  1998,  the  Partnership  has  $1,303,556  in cash and cash
equivalents which are deposited in interest-bearing accounts with an institution
which is not insured by the Federal Deposit Insurance  Corporation  ("FDIC"). As
of December 31, 1998, Carrollton has $161,996 in excess of FDIC insurance limits
at one bank.

</TABLE>

                                      F-15


<PAGE>
<TABLE>
<CAPTION>



                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 10 - Reconciliation of Taxable Income (Loss) and Bases of Assets

A  reconciliation  of the financial  statement net loss to the income tax income
(loss) of the  Partnership  for each of the years ended December 31, 1998,  1997
and 1996 is as follows:

                
                                              1998          1997        1996
                                         -------------------------------------
<S>                                          <C>            <C>          <C>
Financial statement net loss            $  (216,504)   $  (596,273) $  (69,521)


Excess depreciation for income tax purposes
  based on estimated useful life           (266,599)      (267,751)   (241,484)


Excess depreciation for financial reporting
  purposes due to purchase accounting
  treatment                                 436,460        438,491     405,607

Deferred revenue                            (11,954)       (11,954)    (14,627)


Amortization of start-up costs and
  construction period interest and taxes        192            224         256


Accrual of related party expense items
  not deductible until paid for tax purposes
  under Internal Revenue Code Section 267    10,083        137,970     240,702


Amounts allocated to other partners of
  Carrollton and Columbia                   (15,366)          4,321    (11,622)
                                     -------------- ---------------------------


Income (loss) as shown on tax return $      (63,688)  $   (294,972) $  309,311
                                     ==============   ============  ==========


A reconciliation of the financial  statement  carrying amount of total assets to
the tax basis as of December 31, 1998 and 1997 is as follows:

                                                    1998               1997
                                           ---------------------- ------------
<S>                                               <C>                 <C>
Financial statement carrying amount of assets $  36,958,954    $  38,149,194

Difference which consists principally of the
      utilization of purchase accounting for financial
      statement purposes                        (14,348,641)     (14,394,766)
                                              ------------- --------------

Tax basis of assets                           $  22,610,313    $  23,754,428
                                              =============    =============


</TABLE>




                                      F-16


<PAGE>



                        SECURED INCOME L.P. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                          DECEMBER 31, 1998, 1997 AND 1996

Note 11 - Fair Value of Financial Instruments

The following disclosure of the estimated fair value of financial instruments is
made in accordance  with the  requirements of SFAS No. 107,  "Disclosures  about
Fair Value of Financial  Instruments."  The estimated fair value of amounts have
been determined using available market information,  assumptions,  estimates and
valuation methodologies.

Cash and Cash Equivalents and Restricted Assets and Funded Reserves

The carrying amount approximates fair value.

Guaranteed Investment Contract

The carrying amount approximates fair value.

Interest and Accounts Receivable

The carrying amount  approximates fair value due to the shore-term nature of the
receivable.

The  estimated  fair values of the  Partnership's  financial  instruments  as of
December 31, 1998 and 1997 are disclosed elsewhere in the financial statements.

                                      F-17