Document:

Exhibit 10.20.1

                                 SALES CONTRACT
                                     between
                            ROBERTS PROPERTIES, INC.,
                        a Georgia corporation, as Seller
                                       and
                      ROBERTS PROPERTIES RESIDENTIAL, L.P.,
                   a Georgia limited partnership, as Purchaser

                              Dated: June 27, 2001

   Property consisting of an approximately 3.919 acre parcel of real property
             located on Northridge Parkway, Fulton County, Georgia

<PAGE>

                                TABLE OF CONTENTS

ARTICLE I -- PROPERTY TO BE CONVEYED.......................................1
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ARTICLE II -- PURCHASE PRICE...............................................1
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ARTICLE III -- ITEMS TO BE DELIVERED BY SELLER AT CLOSING..................2
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ARTICLE IV -- ITEMS TO BE DELIVERED BY PURCHASER AT CLOSING................3
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ARTICLE V -- TIME AND PLACE OF CLOSING AND CLOSING COSTS...................3
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ARTICLE VI -- APPORTIONMENTS...............................................3
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ARTICLE VII -- PURCHASER'S CONDITIONS PRECEDENT............................4
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ARTICLE VIII -- EMINENT DOMAIN.............................................4
------------------------------

ARTICLE IX -- SELLER'S REPRESENTATIONS AND WARRANTIES......................5
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ARTICLE X -- DEFAULT AND REMEDIES..........................................5
---------------------------------

ARTICLE XI -- NOTICES......................................................6
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ARTICLE XII -- SETTLEMENT ITEMS............................................7
-------------------------------

ARTICLE XIII -- ACCESS.....................................................7
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ARTICLE XIV -- BROKERS.....................................................8
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ARTICLE XV -- MISCELLANEOUS................................................8
---------------------------

<PAGE>

                                SALES CONTRACT

        THIS AGREEMENT is made and entered into this 27th day of June, 2001 by
and between ROBERTS PROPERTIES, INC., a Georgia corporation (hereinafter
referred to as the "Seller") and ROBERTS PROPERTIES RESIDENTIAL, L.P., a Georgia
limited partnership (hereinafter referred to as the "Purchaser").

                      ARTICLE I -- PROPERTY TO BE CONVEYED

         A. Seller shall sell to Purchaser, and Purchaser shall purchase from
Seller, upon the terms and conditions hereinafter set forth, that certain parcel
of land (hereinafter referred to as the "Land") described on Exhibit A attached
hereto with the buildings and improvements, if any, on the Land (hereinafter
referred to as the "Improvements") and the machinery and equipment, attached
thereto, if any (all of the foregoing real and personal property is hereinafter
collectively referred to as the "Property").

         B. The Property shall include all right, title and interest, if any, of
Seller in and to any land lying in the bed of any street, road, highway or
avenue, open or proposed, in front of or adjoining all or any part of the Land
and in all strips, gores or rights-of-way, riparian rights and easements, and
all right, title and interest of Seller, if any, in and to any award or payment
made or to be made (i) for any taking in condemnation or eminent domain of land
lying in the bed of any street, road, highway or avenue, open or proposed, in
front of or adjoining all or any part of the Land, (ii) for damage to the
Property or any part thereof by reason of change of grade or closing of any such
street, road, highway or avenue, (iii) for any taking in condemnation or eminent
domain of any part of the Property.

         C. The Property consists of approximately 3.919 acres of real property
located in Land Lots 25 and 26 of the 17th District, Fulton County, Georgia,
fronting on Northridge Parkway.

                          ARTICLE II -- PURCHASE PRICE

                The purchase price (hereinafter referred to as the "Purchase
Price") for the Property shall be Two Million, One Hundred Twenty Thousand, Five
Hundred One and No/100 Dollars ($2,120,501.00), and subject to all prorations
and adjustments provided herein, shall be paid as follows:

         A. Concurrently with the execution of this Agreement, Purchaser shall
pay to Seller $100.00 (the "Deposit") by check subject to collection or by wire
transfer, such amount to be deposited in a non-interest bearing account. The
Deposit shall be applied toward the Purchase Price due at Closing (as
hereinafter defined) only if the Closing contemplated hereby is consummated as
herein provided, or shall otherwise be applied as elsewhere provided in this
Agreement.

<PAGE>

         B. The amount (which amount includes the amount of the Deposit) of
$2,120,501.00 shall be paid by Purchaser at Closing by certified, cashier or
federal funds check drawn to the order of Seller or by wire-transfer of
immediately available cash to Seller, out of which Seller shall pay off and have
cancelled all deeds to secure debt and similar instruments affecting the
Property.

            ARTICLE III -- ITEMS TO BE DELIVERED BY SELLER AT CLOSING

         At Closing Seller agrees to deliver the following items to Purchaser.
Drafts of all documents to be delivered at Closing as specified in this
Agreement shall be prepared by Seller's counsel.

         A. Title to the Land shall be conveyed by a limited warranty deed
(herein called the "Deed") which will (i) contain a limited warranty of title to
the effect that Seller will warrant title to the Purchaser as against any claim
by any person owning, holding or claiming by, through or under Seller, but not
otherwise, and (ii) be subject only to those title exceptions contained on
Exhibit B attached hereto and made a part hereof (herein called the "Permitted
Exceptions").

         B. A Title Affidavit of a corporate officer of Seller (in a form
customarily utilized in Atlanta, Georgia) showing that all debts for labor and
materials in respect of the Property have been paid in full and that there are
no outstanding claims, suits, debts, liens or judgments against the Property,
except for the Permitted Exceptions.

         C. A FIRPTA Affidavit and an Affidavit of Seller's Residence as
respects O.C.G.A.ss.48-7-128.

         D. An IRS form 1099, and a Designation of Reporting Agent and
Transferor Identification form.

         E. Such evidence as is required by the title insurance company (the
"Title Company") insuring the title to the Property for Purchaser as is required
by the Title Company to delete any and all security deeds and claims of
mechanics and materialmen encumbering the Property from the title insurance
commitment to be marked at Closing.

         F. Such evidence as is required by the Title Company as to the
authority of those acting on behalf of the Seller in connection with the
transaction contemplated in this Agreement, which such evidence shall include a
current certificate of existence from the Secretary of State of Georgia and a
corporate resolution and incumbency certificate.

         G. Any other documents referred to or specified in this Agreement.

                                       2
<PAGE>

           ARTICLE IV -- ITEMS TO BE DELIVERED BY PURCHASER AT CLOSING

         At Closing, Purchaser agrees to deliver the following items to Seller:

         A. The Purchase Price as required by and in the manner specified in
Section II B hereof.

         B. Any other documents referred to or specified in this Agreement.

            ARTICLE V -- TIME AND PLACE OF CLOSING AND CLOSING COSTS

         A. The consummation of the transaction contemplated herein shall take
place on June 28, 2001 (the date such consummation occurs being herein referred
to as the "Closing" or "Closing Date") at the offices of Holt Ney Zatcoff &
Wasserman, LLP, Atlanta, Georgia commencing at 10:00 A.M.

         B. At Closing, Purchaser shall pay the transfer tax and recording fees
incident to the Deed, and all other closing expenses with respect to the closing
of the transaction contemplated herein, including, without limitation, survey
costs, recording fees, the premium incident to any title insurance policy to be
issued to Purchaser, except that Seller and Purchaser will each pay their own
attorney's fees.

         C. Possession of the Property will be delivered by Seller to Purchaser
on the Closing Date.

                          ARTICLE VI -- APPORTIONMENTS

         The following items shall be apportioned at Closing and as of the
Closing Date:

         A. All real property taxes, including the current installment for any
assessment (special, bond, or otherwise), and personal property ad valorem
taxes, if any. Seller shall be entitled to receive a return of all utility
deposits placed with any utility company, and Purchaser shall be responsible to
place its own deposit with any such utility company. Seller shall be entitled to
receive all income in respect of the Property and shall be obligated to pay all
expenses, including utility charges, in respect of the Property for all time
periods prior to and including the day prior to the Closing Date. Purchaser
shall be entitled to receive all such income and shall be obligated to pay all
such expenses, including utility charges, for all time periods commencing with
the Closing Date. In the event that any income or any expense item relating to
the period prior to the Closing Date is received or appears after the Closing,
such item(s) shall be adjusted between the Seller and the Purchaser within ten
(10) days after such is discovered. This Section VI A shall survive the Closing
of the transaction contemplated herein, but only for a period of thirty (30)
days after which all prorations and adjustments shall be final as between Seller
and Purchaser, except that because the proration for real property taxes in
respect of the Property

                                       3
<PAGE>

shall be based on 2000 taxes because the 2001 tax bill will not be available at
Closing, taxes for 2001 shall be reprorated between Seller and Purchaser
immediately upon demand being made by one party upon the other in the event
there is any difference in the 2000 amount of real property taxes with respect
to the Property and the 2001 amount of such taxes when the 2001 tax bill is
available.

                 ARTICLE VII -- PURCHASER'S CONDITIONS PRECEDENT

         Purchaser shall not be required to purchase the Property unless the
following conditions precedent have been satisfied:

         A. The physical condition of the Property shall be substantially the
same on the Closing Date as on the date of full execution hereof, normal wear
and tear excepted.

         B. As of the Closing Date there shall be no administrative agency
action, litigation or other governmental proceeding of any kind pending or
threatened against the Seller or the Property which after the Closing would
materially, adversely affect the value of the Property.

                         ARTICLE VIII -- EMINENT DOMAIN

         A. If, prior to the Closing Date, all of the Property is taken by
condemnation or eminent domain or same is pending, this Agreement shall
terminate as of the day title to the Property or possession thereof vests in the
condemning authority, the Deposit shall be returned by Seller to Purchaser, and
upon such return this Agreement shall terminate and be null and void and of no
further force or effect and neither Purchaser nor Seller shall have any further
rights, remedies, duties, liabilities or obligations to the other hereunder. If,
prior to the Closing Date, there shall be any condemnation or eminent domain
proceedings instituted or pending against less than all of the Property, and
same would interfere with Purchaser's ability to develop the Property for
Purchaser's intended use, then Purchaser may elect to terminate this Agreement
by written notice given to Seller within three (3) days after Purchaser has
received notice from Seller of such proceedings. Upon such notice to Seller the
Deposit shall immediately be returned to Purchaser by Seller, and upon such
return this Agreement shall terminate and be null and void and of no further
force or effect and neither Purchaser nor Seller shall have any further rights,
remedies, duties or obligations to the other hereunder. Failure of the Purchaser
to so notify Seller within said three (3) days that Purchaser has elected to
terminate this Agreement shall be deemed to mean that Purchaser has elected not
to terminate this Agreement. If Purchaser does not so elect to terminate this
Agreement, then the Closing shall take place as provided herein without
abatement of the Purchase Price, and there shall be assigned to the Purchaser at
the Closing, all interest of the Seller in and to any condemnation awards which
may be payable to the Seller on account of such occurrence.

                                       4

<PAGE>

              ARTICLE IX -- SELLER'S REPRESENTATIONS AND WARRANTIES

         Seller represents and warrants to Purchaser that:

         A. Seller has all requisite power and authority to execute this
Agreement, the closing documents listed in Article III hereof, and any other
documents required to be delivered by the Seller.

         B. To the best of Seller's knowledge, the conveyance of the Property to
Purchaser pursuant to this Agreement will not be a violation by Seller of any
applicable statute, ordinance, governmental restriction, or regulation, or any
private restriction or agreement.

         C. To the best of Seller's knowledge, as of the date of full execution
hereof, there is no administrative agency action, litigation or other
governmental proceeding of any kind pending or threatened against the Seller or
the Property which after the Closing would materially, adversely affect the
value of the Property.

         D. To the best of Seller's knowledge, no special assessments of any
kind (special, bond or otherwise) are levied against the Property which are
outstanding and unpaid.

         E. Seller has no knowledge of any pending or contemplated condemnation
proceedings affecting the Property or any part thereof. Seller will not sell,
assign or convey any right, title or interest whatever in or to the Property or
create or permit to exist any lien, encumbrance, or charge thereon without
promptly discharging the same, except as otherwise expressly provided for
herein.

         F. Seller will not willfully take any action, or willfully omit to take
any action, which action or omission would have the effect of violating any of
its representations, warranties, covenants and agreements contained herein.

         Seller's warranties and representations contained in this Agreement
shall not survive the Closing and shall be merged into the Deed and other
documents to be executed and delivered in connection with the transaction
contemplated herein.

                        ARTICLE X -- DEFAULT AND REMEDIES

         A. In the event that the transaction contemplated herein is not closed
and consummated because of Purchaser's failure or breach to perform its
obligations hereunder, Seller shall retain the Deposit as agreed-upon liquidated
damages and not a penalty, it being otherwise difficult or impossible to
estimate Seller's actual damages, and which liquidated damages shall be in lieu
of any other damages or the right to specific performance, and, upon such event,
this Agreement shall terminate and be null and void and of no further force or
effect, and neither Seller nor Purchaser shall have any further rights,
remedies, duties, liabilities or obligations to the other hereunder. Seller
hereby waives any right to specific performance,

                                       5
<PAGE>

injunctive relief or any other relief to cause Purchaser to perform its
obligations under this Agreement, and Seller hereby waives any right to damages
in excess of said liquidated damages occasioned by Purchaser's breach of this
Agreement. Seller and Purchaser acknowledge that it is impossible to estimate
the actual damages Seller would suffer from Purchaser's breach hereof, but that
the liquidated damages provided herein represent a reasonable pre-estimate of
such damages and Seller and Purchaser therefor intend to provide for liquidated
damages as herein specified, and that the agreed-upon liquidated damages are not
punitive or penalties and are just, fair and reasonable, all in accordance with
O.C.G.A. ss. 13-6-7.

         B. In the event that the transaction contemplated herein is not closed
and consummated because of Seller's failure or breach to perform its obligations
hereunder or because of a breach by Seller of any of the representations and
warranties made herein by Seller, Purchaser shall have the right only (i) to
terminate this Agreement by giving notice thereof to Seller, and upon receipt of
such notice Seller shall return the Deposit to Purchaser and thereafter this
Agreement shall terminate and be null and void and of no further force or
effect, and neither Seller nor Purchaser shall have any further rights,
remedies, duties, liabilities or obligations to the others hereunder, or (ii) to
sue Seller for specific performance of its obligations under this Agreement;
which remedies specified in (i) and (ii) shall be in lieu of any other rights or
remedies for Purchaser, including, without limitation, any right or claim for
damages. If Purchaser consummates the transaction contemplated in this Agreement
it shall be conclusively deemed to have waived any breach by Seller of any
covenant, representation or warranty under this Agreement (but not under any of
the documents executed at Closing which shall continue in accordance with their
terms) which the Purchaser knew existed prior to the Closing.

                              ARTICLE XI -- NOTICES

         Whenever any notice, demand, or request is required or permitted
hereunder, such notice, demand or request shall be in writing and shall be
hand-delivered in person or sent by United States mail, registered, certified or
Express Mail, postage prepaid, or by Federal Express or similar expedited
delivery service, to the addresses set forth below:

                         To Seller:
                         ---------

                         Roberts Properties, Inc.
                         8010 Roswell Road
                         Suite 120
                         Atlanta, Georgia 30350

                                       6

<PAGE>

                         To Purchaser:
                         ------------

                         Roberts Properties Residential, L.P.
                         c/o Roberts Properties, Inc.
                         8010 Roswell Road
                         Suite 120
                         Atlanta, Georgia 30350

                         With a Copy to:
                         --------------

                         Sanford H. Zatcoff, Esq.
                         Holt Ney Zatcoff & Wasserman, LLP
                         100 Galleria Parkway
                         Suite 600
                         Atlanta, Georgia  30339

Any notice, demand, or request which shall be served upon any of the parties in
the manner aforesaid shall be deemed sufficiently given for all purposes
hereunder (i) at the time such notice, demand or request is hand-delivered in
person, or (ii) on the day such notices, demands or requests are deposited in
the United States Mail or with such expedited delivery service in accordance
with the preceding portion of this Article XI. Either Purchaser or Seller shall
have the right from time to time to designate by written notice to the other
such other person or persons and at such other places in the United States as
Purchaser or Seller desires written notices, demands, or requests to be
delivered or sent in accordance herewith; provided, however, at no time shall
either party be required to send more than an original and two (2) copies of any
such notice, demand or request required or permitted hereunder.

                         ARTICLE XII -- SETTLEMENT ITEMS

         In addition to the items specifically mentioned in this Agreement to be
delivered at the Closing, Seller shall deliver the following items to Purchaser
at the Closing: any sewer, water and other utility bills and assessment bills
any part of which is to be paid by Purchaser; and a complete and accurate
statement setting forth the necessary information upon which any adjustment
shall be made at the Closing.

                             ARTICLE XIII -- ACCESS

         Purchaser and its agents and representatives shall have the right to
enter upon the Property at any reasonable time prior to the Closing Date, for
any lawful purpose, including, without limitation, investigations, tests and
studies, structural inspection, and survey purposes; provided, however,
Purchaser shall pay for all such work performed on the Property and shall not
permit the creation of any lien in favor of any contractor, subcontractor,
materialman, mechanic, surveyor, architect or laborer, and Purchaser hereby
expressly agrees to indemnify and hold Seller harmless with respect thereto; and
provided further, however, that Purchaser hereby expressly agrees

                                       7

<PAGE>

to indemnify and hold Seller harmless against any claim, damage or injury to
either persons or property arising out of Purchaser's or its agent's, employees'
or representatives' actions under this Article XIII. This Article XIII shall
survive the Closing of the transaction contemplated herein or any other
termination of this Agreement.

                             ARTICLE XIV -- BROKERS

         A. Purchaser and Seller hereby represent to each other that no real
estate broker or agent was involved in negotiating the transaction contemplated
herein. In the event any claim(s) for real estate commissions, fees or
compensation arise in connection with this Agreement and the transaction
contemplated herein, the party so incurring or causing such claim(s) shall
indemnify, defend and hold harmless the other party from any loss, claim or
damage which the other party suffers because of said claim(s).

                           ARTICLE XV -- MISCELLANEOUS

         A. This Agreement constitutes the entire agreement between the parties
hereto and cannot be changed or modified other than by a written agreement
executed by both Purchaser and Seller.

         B. There shall also be executed and delivered at Closing all other
documents and instruments reasonably required or necessary to effect the
transaction contemplated herein.

         C. Irrespective of the place of execution or performance, this
Agreement shall be governed by and construed in accordance with the laws of the
State of Georgia. This Agreement shall be construed without regard to any
presumption or other rule requiring construction against the party causing this
Agreement to be drafted. If any words or phrases in this Agreement shall have
been stricken out or otherwise eliminated, whether or not any other words or
phrases have been added, this Agreement shall be construed as if the words or
phrases so stricken out or otherwise eliminated were never included in this
Agreement and no implication or inference shall be drawn from the fact that said
words or phrases were so stricken out or otherwise eliminated. All terms and
words used in this Agreement regardless of the number or gender in which they
are used, shall be deemed to include any other number and any other gender as
the context may require.

         D. This Agreement may be executed in more than one counterpart, each of
which shall be deemed an original.

         E. The captions of this Agreement are inserted for convenience or
reference only and do not define, describe or limit the scope or intent of this
Agreement or any of the terms hereof.

                                       8
<PAGE>

         F. Time is of the essence of this Agreement and each term and provision
hereof.

         G. If any term, covenant or condition of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement and the application of
such terms, covenants and conditions to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby and each term, covenant and condition of this Agreement shall be valid
and be enforced to the fullest extent permitted by law.

         H. All rights, powers and privileges conferred hereunder upon the
parties unless otherwise provided shall be cumulative and not restricted to
those given by law.

         I. No failure of any party to exercise any power given such party
hereunder or to insist upon strict compliance by any other party to its
obligations hereunder, and no custom or practice of the parties in variance with
the terms hereof, shall constitute a waiver of any party's right to demand exact
compliance with the terms hereof.

         J. Purchaser shall have the right to waive any condition or contingency
herein in Purchaser's favor and Seller shall have the right to waive any
condition or contingency herein in Seller's favor.

         K. Anything contained in this Agreement to the contrary
notwithstanding, (i) except as specifically set forth in this Agreement to the
contrary, the terms and provisions of this Agreement shall not survive Closing
and shall be merged into the Deed; and (ii) except as specifically set forth in
this Agreement to the contrary, Seller does not make any warranties or
representations of any kind or character, expressed or implied, with respect to
the Property, its physical condition, income to be derived therefrom or expenses
to be incurred with respect thereto, or any other matter or thing relating to or
affecting the Property, and there are no oral or written agreements, warranties
or representations with respect to the Property, except as otherwise expressly
set forth in this Agreement.

         L. The provisions of this Agreement shall extend to, bind and inure to
the benefit of the parties hereto and their respective successors, assigns and
the legal representatives of their estates.

         M. Purchaser is acquiring the Property as replacement property and this
Agreement is entered into pursuant to the terms and provisions of a certain
Exchange Agreement dated January 4, 2001 between Purchaser and LandAmerica
Exchange Company, as Exchangor. Purchaser is acquiring the Property as
replacement property in connection with an exchange by Purchaser of relinquished
property of like kind in order to have the transaction qualify as an exchange
pursuant to Section 1031 of the United States Internal Revenue Code, as amended,
and the Regulations promulgated thereunder. Seller agrees to cooperate with
Purchaser in effecting such an exchange, including through the use of a
qualified intermediary

                                       9

<PAGE>

to which Purchaser shall have the right to assign its rights under this
Agreement, provided that such cooperation shall be at no cost or expense
whatsoever to Seller, and such exchange shall not delay Seller in the Closing of
its sale of the Property, nor excuse Purchaser from performing its obligations
under this Agreement in the event that Purchaser is unable to or is delayed in
effecting such an exchange.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, sealed and delivered the day and year first above written.

                          SELLER:

                          ROBERTS PROPERTIES, INC., a Georgia
                          corporation

                          By:       /s/ Charles S. Roberts
                             -----------------------------
                               Charles S. Roberts
                               President

                                      (CORPORATE SEAL)

                          PURCHASER:

                          ROBERTS PROPERTIES RESIDENTIAL, L.P.,
                          a Georgia limited partnership

                          By:   Roberts Realty Investors, Inc., a Georgia
                                corporation, its sole general partner

                                  By:   /s/ Charles R. Elliott
                                     -------------------------
                                      Charles R. Elliott,
                                      Secretary and Treasurer

                                              (CORPORATE SEAL)Exhibit 10.20.2

<TABLE>
<CAPTION>

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<S>                                <C>                           <C>
Roberts Properties Residential, L.P.    BANK OF NORTH GEORGIA       App.#
8010 Roswell Road                       8025 Westside Parkway       Loan Number:
Suite 120                               P. O. Box 1407              Date: June 28, 2001
Atlanta, GA  30350                      Alpharetta, GA  30004       Maturity Date: May 28, 2004
                                                                    Loan Amount: $5,280,000.00
                                                                    Renewal of __________________

</TABLE>

BORROWER'S NAME AND ADDRESS                  LENDER'S NAME AND ADDRESS
"I" includes each borrower above, joint      "You" means the lender, its
and severally.                                successors  and assigns

For value received, I promise to pay to you, or your order, at your address
listed above the PRINCIPAL sum of FIVE MILLION TWO HUNDRED EIGHTY THOUSAND
DOLLARS ($5,280,000.00)

|_| Single Advance: I will receive all of this principal sum on
____________________________________. No additional advances are contemplated
under this note.
|X| Multiple Advance: The principal sum shown above is the
maximum amount of principal I can borrow under this note. On June 28, 2001, I
will receive the amount of $859,782.46, and future principal advances are
contemplated.
         Conditions:  The  conditions  for  future  advances  are set  forth  in
that  certain  Construction  Loan Agreement of even date herewith between
Borrower and Lender.
         |_| Open End Credit: You and I agree that I may borrow up to the
maximum amount of principal more than one time. This feature is subject to all
other conditions and expires on--------------------------------------.
         |X| Closed End Credit: You and I agree that I may borrow up to the
         maximum only one time (and subject to all other conditions).
INTEREST:  I agree to pay  interest  on the  outstanding  principal  balance
from  June 28,  2001,  at the rate of 5.75125% per year until the index rate
changes.
|X| Variable Rate:  This rate may then change as stated below.
         |X| Index Rate: The future rate will be 2.00% above the following index
         rate: the "index rate" shall be the 30 day adjusted LIBOR. LIBOR shall
         be defined as the average of interbank offered rates for one (1) month
         U.S. dollar denominated deposits in the London market as determined by
         the Bank of North Georgia and adjusted for reserves, deposit insurance
         assessments and other regulatory costs. In the event the 30 day
         adjusted LIBOR is no longer available, Lender will choose a new index
         which is based on comparable information. Lender will give Borrower
         notice of its choice of index.
         |_| No Index: The future rate will not be subject to any internal or
         external index. It will be entirely in your control.
         |X|      Frequency and Timing: The rate on this note may change as
                  often as monthly. A change in the interest rate will take
                  effect as of the date the index rate changes.
         |_| Limitations: During the term of this loan, the applicable annual
         interest rate will not be more than __________________________% or less
         than __________________________%. Effect of Variable Rate: A change in
         the interest rate will have the following effect on the payments: |X|
         The amount of each scheduled payment will change. __________________
         |X| The ___ amount ___ of the ___ final payment will change.
         |_|
--------------------------------------------------------------------------------
ACCRUAL METHOD: Interest will be calculated on an actual/360 basis.
POST MATURITY RATE: I agree to pay interest on the unpaid balance of this note
owing after maturity, and until paid in full, as stated below:
         |_| on the same fixed or variable rate basis in effect before maturity
(as indicated above).
         |X|  at a rate equal to 16%.
|X| LATE CHARGE: If a payment is made more than ten (10) days after it is due, I
agree to pay a late charge of 7.00% of the unpaid amount, with a minimum of
$25.00 and a maximum of $1,000.00.
|X| ADDITIONAL CHARGES: In addition to interest, I agree to pay the following
charges which |_| are |X| are not included in the principal amount above:
Loan fee and charges stated on loan closing statement, dated June_28, 2001.
---------------------------------------------------------------------------
PAYMENTS: I agree to pay this note as follows:
|X| Interest: I agree to pay accrued interest for 35 months through and
including May 28, 2004.
|_| Principal: I agree to pay the principal
------------------------------------------------------------------------

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|X| Installments: I agree to pay this note in 35 payments. The first payment
will be in the amount of (INTEREST ONLY) and will be due on July 28, 2001. A
payment of (INTEREST ONLY) will be due on the 28st day of each month thereafter.
The final payment of the entire unpaid balance of principal and interest will be
due May 28, 2004.
|X| If checked, and this loan is secured by a first lien on real estate, then
any accrued interest not paid when due (whether due by reason of a schedule of
payments or due because of lender's demand) will become part of the principal
thereafter, and will bear interest at the interest rate in effect from time to
time as provided for in this agreement.

ADDITIONAL TERMS: Borrower may prepay this Note in full or in part at any time
without notice or penalty. See Addendum "A" attached hereto and incorporated
herein by reference.

THIS NOTE SECURED BY:
*Refer to Security Agreement dated June 28, 2001; Deed to Secure Debt dated June
28, 2001.

*Real Estate as described in Deed to Secure Debt dated June 28, 2001, to Bank of
North Georgia.

*Pledge and assignment of all current and future rents and leases

<TABLE>
<CAPTION>

<S>                                                          <C>
PURPOSE:  The purpose of this loan is construction of a 37,864   SIGNATURES  AND SEALS:  IN WITNESS  WHEREOF,  I HAVE SIGNED MY NAME
square foot corporate  headquarters  building for Roberts        AND  AFFIXED MY SEAL ON THIS 28st DAY OF JUNE,  2001 BY DOING SO, I
Properties, Inc. and its a affiliates.                           AGREE TO THE  TERMS  OF THIS  NOTE  (INCLUDING  THOSE ON PAGE 2). I
                                                                 HAVE RECEIVED A COPY ON TODAY'S DATE.

Signature for Lender                                             ROBERTS PROPERTIES RESIDENTIAL, L.P.
BANK OF NORTH GEORGIA                                            a Georgia limited partnership

By: /s/ Allen Barker                                              By: Roberts Realty Investors, Inc.,
   --------------------------------------------------                 a Georgia corporation, as General Partner
   Allen Barker, Senior Vice President

                                                                    By:      /s/ Charles R. Elliott
                                                                       ----------------------------
                                                                         Charles R. Elliott, Chief Financial Officer
                                                                         and Secretary/Treasurer

                                                                                           [CORPORATE SEAL]
                                                                                                              Page 1 of 2
</TABLE>

<PAGE>

APPLICABLE LAW: The law of the state of Georgia will govern this note. Any term
of this note which is contrary to applicable law will not be effective, unless
the law permits you and me to agree to such a variation. If any provision of
this agreement cannot be enforced according to its terms, this fact will not
affect the enforceability of the remainder of this agreement. No modification of
this agreement may be made without your express written consent. Time is of the
essence in this agreement.
PAYMENTS: Each payment I make on this note will first reduce the amount I owe
you for charges which are neither interest nor principal. The remainder of each
payment will then reduce accrued unpaid interest, and then unpaid principal. If
you and I agree to a different application of payments, we will describe our
agreement on this note. I may prepay a part of, or the entire balance of this
loan without penalty, unless we specify to the contrary on this note. Any
partial prepayment will not excuse or reduce any late scheduled payment until
this note is paid in full (unless, when I make the prepayment, you and I agree
in writing to the contrary).
INTEREST: If I receive the principal in more than one advance, each advance will
start to earn interest only when I receive the advance. The interest rate in
effect on this note at any given time will apply to the entire principal
advanced at that time. You and I may provide in this agreement for accrued
interest not paid when due to be added to principal. Notwithstanding anything to
the contrary, I do not agree to pay and you do not intend to charge any rate of
interest that is higher than the maximum rate of interest you could charge under
applicable law for the extension of credit that is agreed to here (either before
or after maturity). If any notice of interest accrual is sent and is in error,
we mutually agree to correct it, and if you actually collect more interest than
allowed by law and this agreement, you agree to refund it to me.
INDEX RATE: The index will serve only as a device for setting the rate on this
note. You do not guarantee by selecting this index, or the margin, that the rate
on this note will be the same rate you charge on any other loans or class of
loans to me or other borrowers.
ACCRUAL METHOD: The amount of interest that I will pay on this loan will be
calculated using the interest rate and accrual method stated on page 1 of this
note. For the purpose of interest calculation, the accrual method will determine
the number of days in a "year." If no accrual method is stated, then you may use
any reasonable accrual method for calculating interest.
POST MATURITY RATE: For purposes of deciding when the "Post Maturity Rate"
(shown on page 1) applies, the term "maturity" means the date of the last
scheduled payment indicated on page 1 of this note or the date you accelerate
payment on the note, whichever is earlier.
SINGLE ADVANCE LOANS: If this is a single advance loan, you and I expect that
you will make only one advance of principal. However, you may add other amounts
to the principal if you make any payments described in the "PAYMENTS BY LENDER"
paragraph below, or if we have agreed that accrued interest not paid when due
may be added to principal.
MULTIPLE ADVANCE LOANS: If this is a multiple advance loan, you and I expect
that you will make more than one advance of principal. If this is closed end
credit, repaying a part of the principal will not entitle me to additional
credit.
PAYMENTS BY LENDER: If you are authorized to pay, on my behalf, charges I am
obligated to pay (such as property insurance premiums), then you may treat those
payments made by you as advances and add them to the unpaid principal under this
note, or you may demand immediate payment of the charges.
SET-OFF:  I agree that you may set off any  amount due and  payable  under  this
note  against  any right I have to receive money from you.
     "Right" to receive money from you" means:
     (1) any deposit account balance I have with you;
     (2) any money owed to me on an item presented to you or in your possession
     for collection or exchange; and (3) any repurchase agreement or other
     nondeposit obligation. "Any amount due and payable under this note" means
     the total amount of which you are entitled to demand
payment under the terms of this note at the time you set off. This total
includes any balance the due date for which you properly accelerate under this
note.
     If my right to receive money from you is also owned by someone who has not
agreed to pay this note, your right to set-off will apply to my interest in the
obligation and to any other amounts I could withdraw on my sole request or
endorsement. Your right of set-off does not apply to an account or other
obligation where my rights are only as a representative. It also does not apply
to any Individual Retirement Account or other tax-deferred retirement account.
     You will not be liable for the dishonor of any check when the dishonor
occurs because you set off this debt against any of my accounts. I agree to hold
you harmless from any such claims arising as a result of your exercise of your
right of set-off.
REAL ESTATE OR RESIDENCE SECURITY: If this note is secured by real estate or a
residence that is personal property, the existence of a default and your
remedies for such a default will be determined by applicable law, by the terms
of any separate instrument creating the security interest and, to the extent not
prohibited by law and not contrary to the terms of the separate security
instrument, by the "Default" and "Remedies" paragraphs herein.
DEFAULT: I will be in default if any one or more of the following occur: (1) I
fail to make a payment on time or in the amount due; (2) I fail to keep the
property insured, if required; (3) I fail to pay, or keep any promise, on any
debt or agreement I have with you; (4) any Synovus Financial Corporation
creditor of mine attempts to collect any debt I owe him through court
proceedings; (5) I die, am declared incompetent, make an assignment for the
benefit of creditors, or become insolvent (either because my liabilities exceed
my assets or I am unable to pay my debts as they become due); (6) I make any
written statement or provide any financial information that is untrue or
inaccurate at the time it was provided; (7) I do or fail to do something which
causes you to believe that you will have difficulty collecting the amount I owe
you; (8) any collateral securing this note is used in a manner or for a purpose
which threatens confiscation by a legal authority; (9) I change my name or
assume an additional name without first notifying you before making such a
change.
REMEDIES:  If I am in default on this note you have, but are not limited to, the
following remedies:
     (1) You may demand  immediate  payment of all I owe you under this note
         (principal, accrued unpaid  interest and other accrued charges).
     (2) You may set off this debt against any right I have to the payment of
         money from you, subject to the terms of the "Set-Off" paragraph herein.
     (3) You may demand security, additional security, or additional parties to
         be obligated to pay this note as a condition for not using any other
         remedy.
     (4) You may refuse to make advances to me or allow purchases on credit by
me.
     (5) You may use any remedy you have under state or federal law.
By selecting any one or more of these remedies you do not give up your right to
later use any other remedy. By waiving your right to declare an event to be a
default, you do not waive your right to later consider the event as a default if
it continues or happens again.
COLLECTION COSTS AND ATTORNEY'S FEES: I agree to pay all costs of collection,
replevin or any other or similar type of cost if I am in default. In addition,
if you hire an attorney to collect this note, I also agree to pay any fee, not
to exceed 15 percent of the principal and interest then owed, you incur with
such attorney plus court costs (except where prohibited by law). To the extent
permitted by the United States Bankruptcy Code, I also agree to pay the actual
attorney's fees and costs you incur to collect this debt as awarded by any court
exercising jurisdiction under the Bankruptcy code.
WAIVER: I give up my rights to require you to do certain things. I will not
     require you to:
     (1) demand payment of amounts due (presentment);
     (2) obtain official certification of nonpayment (protest);
     (3) give notice that amounts due have not been paid (notice of dishonor);
         or
     (4) give me notice prior to seizure of my personal property when you are
         seeking to foreclose a secured interest in any of my personal property
         used to secure a commercial transaction.
OBLIGATIONS INDEPENDENT: I understand that I must pay this note even if someone
else has also agreed to pay it (by, for example, signing this form or a separate
guarantee or endorsement). You may sue me alone, or anyone else who is obligated
on this note, or any number of us together, to collect this note. You may do so
without any notice that it has not been paid (notice of dishonor). You may
without notice release any party to this agreement without releasing any other
party. If you give up any of your rights, with or without notice, it will not
affect my duty to pay this note. Any extension of new credit to any of us, or
renewal of this note by all or less than all of us will not release me from my
duty to pay it. (Of course, you are entitled to only one payment in full). I
agree that you may at your option extend this note or the debt represented by
this note, or any portion of the note or debt, from time to time without limit
or notice and for any term without affecting my liability for payment of the
note. I will not assign my obligation under this agreement without your prior
written approval.
CREDIT INFORMATION: I agree and authorize you to obtain credit information about
me from time to time (for example, by requesting a credit report) and to report
to others your credit experience with me (such as a credit reporting agency). I
agree to provide you, upon request, any financial statement or information you
may deem necessary. I warrant that the financial statements and information I
provide to you are or will be accurate, correct and complete.
NOTICE: Unless otherwise required by law, any notice to me shall be given by
delivering it or by mailing it by first class mail addressed to me at my last
known address. My current address is on page 1. I agree to inform you in writing
of any change in my address. I will give any notice to you by mailing it first
class to your address stated on page 1 of this agreement, or to any other
address that you have designated.

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------

<S>             <C>           <C>        <C>          <C>           <C>            <C>           <C>
DATE OF            PRINCIPAL   BORROWER'S    PRINCIPAL       PRINCIPAL    INTEREST    INTEREST         INTEREST
TRANSACTION        ADVANCE     INITIALS      PAYMENTS        BALANCE      RATE        PAYMENTS         PAID
                   ($)         (not                                       (%)         ($)              THROUGH:
                               required)
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------

</TABLE>

<PAGE>

                         ADDENDUM "A" TO PROMISSORY NOTE

         THIS ADDENDUM TO PROMISSORY NOTE ("Addendum") is hereby attached to,
incorporated into and made a part of that certain promissory note dated June 28,
2001 made by Roberts Properties Residential, L.P. ("Borrower") in favor of Bank
of North Georgia ("Lender") in the principal face amount of $5,280,000.00 (the
"Note"). In the event of any inconsistency between the terms of this Addendum
and the terms of the Note, this Addendum shall control. The following provisions
are specifically made a part of the Note:

         1.  Borrower shall not change ownership or control, reorganize
or change name or form of organization without the prior written consent of
Lender, except as set forth in paragraph 3 hereinbelow . Failure to obtain said
prior written consent shall constitute an Event of Default and authorize Lender
to declare all or any part of the indebtedness immediately due and payable.

         2.  Upon request by Lender, Borrower will provide Lender with
quarterly financial statements including balance sheets and profit and loss
statements within forty-five (45) days of Borrower's quarter end. Upon request
by Lender, annual financial statements, including but not limited to Borrower's
balance sheet and profit and loss statements prepared by Borrower's certified
public accountant shall be submitted to Lender within ninety (90) days of
Borrower's fiscal year end. Upon request by Lender, Borrower will provide Lender
with partnership and corporate tax returns for its fiscal year end within thirty
(30) days of its tax filing date. The Borrower will provide Lender with a copy
of all sales contracts and/or leases upon signing with respect to the property
more particularly described in Exhibit "A" hereto and made part hereof (the
"Property"). Failure to provide such financial information within the applicable
time period shall constitute an Event of Default and authorize Lender to declare
all or any part of the indebtedness immediately due and payable.

         3. During the pendency of the Note, any property pledged as security
for the Note and all other collateral shall remain free and clear of all
encumbrances, liens, mortgages, security interests and secondary financing
except those approved in writing by Lender, and Borrower shall not, without the
prior written consent of Lender, sell, transfer, or convey all or any part of
its interest in the Property or any portion thereof, except to Roberts Realty
Investors, Inc. or a Permitted Transferee (as hereinafter defined). Any sale,
transfer or conveyance to any person or entity, other than Roberts Realty
Investors, Inc. or an entity whose shares of stock or limited partnership units
are publicly traded, shall be conditioned upon Lender's receipt of an unlimited
personal guaranty of Charles S. Roberts of such transferee's obligations to
Lender pursuant to the Note and this Addendum. Borrower, or any successor or
assignee of Borrower, shall not, without the prior written consent of Lender,
sell, transfer or convey all or any ownership interest in Borrower, or any
successor or assignee of Borrower. Such restriction shall not apply to the sale
or transfer of any publicly traded shares of stock or limited partnership units
of Borrower, or any successors or assignee of Borrower. Such restriction shall
further not apply to any sale, transfer or conveyance of any ownership interest
in a Permitted Transferee, provided such sale, transfer or conveyance does not
result in Charles S. Roberts owning less than a fifty-one (51%) percent
controlling interest in such entity. For purposes of this Agreement, a Permitted
Transferee shall be defined as any entity of which Charles S. Roberts owns at
least fifty-one (51%) percent of the ownership interests. In the event such
sale, transfer or conveyance occurs, the Borrower must give notice to the Bank
and the Bank shall transfer the loan for a documentation fee of $250.00. The
Borrower shall pay all costs

                                       2

<PAGE>

associated with this transfer. In the event Charles S. Roberts ("Guarantor") is
required to and does provide Lender with an unlimited personal guaranty,
Guarantor shall not, without prior written consent of Lender, sell, transfer or
convey all or any part of his ownership interest in such transferee, any
additional property, business property or other assets, or any portion thereof
such that Guarantor's net worth decreases to less than $10,000,000.00. The
occurrence of a violation of any of the foregoing restrictions shall, at the
option of Lender, constitute grounds for accelerating any and all sums advanced
and unpaid under the Note.

         4.  Notwithstanding the terms of the Default and Waiver
paragraphs set forth in this Note, or any of the other terms and provisions
contained within this Note, this Note shall not be deemed to be in default (i)
with respect to a failure to comply with a monetary obligation until ten (10)
days following Borrower's receipt of Lender's notice thereof and Borrower's
failure to cure same within such ten (10) day period, and (ii) with respect to a
failure to comply with a non-monetary obligation until thirty (30) days
following Borrower's receipt of Lender's notice thereof and Borrower's failure
to cure same within such thirty (30) day period. In the event Borrower's failure
to comply with a nonmonetary obligation cannot be cured within thirty (30) days
of receipt of Lender's notice thereof, Borrower shall have an additional sixty
(60) days to cure same, provided Borrower, in Lender's reasonable opinion, is
diligently pursuing said cure.

         5.  It is hereby expressly agreed that should any default be
made in the payment of principal or interest as stipulated above, or should any
default be made in the performance of any of the covenants or conditions
contained in any of the Loan Documents, as that term is hereinafter defined,
then, and in such event, the principal indebtedness evidenced hereby, and any
other sums advanced hereunder or under the Loan Documents, together with all
unpaid interest accrued thereon, shall, at the option of Lender, at once become
due and payable and may be collected forthwith, regardless of the stipulated
date of maturity. TIME IS OF THE ESSENCE OF THIS NOTE. Interest shall accrue on
the outstanding principal balance of this Note from the date of any default
hereunder and for so long as such default continues, regardless of whether or
not there has been an acceleration of the indebtedness evidenced hereby as set
forth herein, at the rate equal to the greater of (i) three percent (3.0%) per
annum in excess of the applicable interest rate at the time of such default or
(ii)sixteen percent (16%) per annum. All such interest shall be paid at the time
of and as a condition precedent to the curing of any such default should Lender,
at its sole option, allow such default to be cured. In the event the Note, or
any part thereof, is collected by or through an attorney at law, Borrower agrees
to pay all costs of collection including, but not limited to, attorneys fees
incurred by Lender. Notwithstanding anything contained herein or in the Note to
the contrary, if under any circumstances Borrower is required hereunder to pay
any or all of Lender's attorney's fees and expenses, Borrower shall be
responsible for actual legal fees and out of pocket expenses incurred by Lender
at normal hourly rates for the work done. Borrower shall not be liable under any
circumstances for any additional attorney's fees or expenses under O.C.G.A. ss.
13-1-11 or otherwise, and, to the extent Lender may be permitted to charge or
receive additional attorney's fees or expenses under O.C.G.A. ss. 13-1-11,
Lender hereby waives such right.

                            [SIGNATURES ON NEXT PAGE]

<PAGE>

                                ROBERTS PROPERTIES RESIDENTIAL, L.P.
                                a Georgia limited partnership

                                By:Roberts Realty Investors, Inc.,
                                    a Georgia corporation, as General Partner

                                     By: /s/  Charles R. Elliott
                                        ----------------------------------------
                                     Charles R. Elliott, Chief Financial Officer
                                             and Secretary/Treasurer

                                             [CORPORATE SEAL]

                                BANK OF NORTH GEORGIA

                                By:  /s/ Allen Barker,
                                    --------------------------------------------
                                     Allen Barker, Senior Vice President

                                       3

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