Boston Capital Real Estate Investment Trust Inc – ‘S-11/A’ on 4/7/06

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Pre-Effective Amendment to Registration Statement for Securities of a Real Estate Company   —   Form S-11
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: S-11/A      Pre-Effective Amendment to Registration Statement    413   1.72M 
                          for Securities of a Real Estate Company                
 2: EX-8.1      Opinion re: Tax Matters                                3     15K 
 5: EX-10.13    Material Contract                                      7     31K 
 3: EX-10.5(B)  Material Contract                                      3     12K 
 4: EX-10.8     Material Contract                                      4     20K 
 6: EX-23.1     Consent of Experts or Counsel                          1      7K 
 7: EX-23.2     Consent of Experts or Counsel                          1      6K 

S-11/A   —   Pre-Effective Amendment to Registration Statement for Securities of a Real Estate Company
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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 7, 2006 

                                                     REGISTRATION NO. 333-108426
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

PRE-EFFECTIVE AMENDMENT NO. 1 TO
POST-EFFECTIVE AMENDMENT NO. 4
TO FORM S-11
REGISTRATION STATEMENT
UNDER 
THE SECURITIES ACT OF 1933, AS AMENDED

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

BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC. 
(Exact Name of Registrant as Specified in Charter)
------------------------

C/O BOSTON CAPITAL CORPORATION
ONE BOSTON PLACE, SUITE 2100
BOSTON, MA 02108-4406 
TELEPHONE (617) 624-8900
(Address of Principal Executive Offices)
------------------------

JEFFREY H. GOLDSTEIN, PRESIDENT 
BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC. 
C/O BOSTON CAPITAL CORPORATION
ONE BOSTON PLACE, SUITE 2100
BOSTON, MA 02108-4406 
TELEPHONE (617) 624-8900
(Name, Address and Telephone Number of Agent For Service) 
------------------------

WITH A COPY TO: 
GILBERT G. MENNA, ESQ.
SUZANNE D. LECAROZ, ESQ.
GOODWIN PROCTER LLP 
EXCHANGE PLACE, 53 STATE STREET 
BOSTON, MA 02109
(617) 570-1000

   APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: AS SOON AS
PRACTICABLE AFTER THE REGISTRATION STATEMENT BECOMES EFFECTIVE.                 

If this Form is filed to register additional securities for an offering 
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier        
effective registration statement for the same offering. / /                     

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under  
the Securities Act, check the following box and list the Securities Act         
registration number of the earlier effective registration statement for the same
offering. / /                                                                   

If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act   
registration statement number of the earlier effective registration statement   
for the same offering. / /                                                      

  If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /                                             
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[GRAPHIC]  Prospectus

250,000 SHARES OF COMMON STOCK (Minimum Offering) 
105,000,000 SHARES OF COMMON STOCK (Maximum Offering) 

BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC. 

This is our initial public offering. We expect to elect to be taxed as a real   
estate investment trust for federal income tax purposes beginning with the tax  
year ended December 31, 2005. We invest in residential apartment communities.   

Up to 100,000,000 shares are being offered on a best-efforts basis at $10 per   
share to investors who meet our suitability standards. No shares will be sold   
unless a minimum of 250,000 shares are sold to investors. Until the closing,    
your purchase funds will be held in an escrow account at Boston Private Bank &  
Trust Company bearing interest at a variable rate, which is currently 3.35% per 
annum and is similar to a bank passbook savings rate. If the minimum amount of  
the offering is not sold, your funds plus interest will be returned to you      
within 5 business days after the termination date. You must purchase at least   
100 shares for $1,000. Up to an additional 5,000,000 shares are being offered to
be issued pursuant to our dividend reinvestment plan at $9.30 per share. This   
offering will end no later than July 1, 2007 (unless extended with respect to   
the shares offered under our dividend reinvestment plan or as otherwise         
permitted by applicable law). The dealer-manager, Boston Capital                
Securities, Inc., is our affiliate.                                             

Investing in our common stock involves risks that are described in the "Risk    
Factors" section beginning on page 42 of this prospectus. Material risks are:   

- We will rely on Boston Capital REIT Advisors, LLC, our advisor and an         
  affiliate of our Company, to select properties and conduct our operations. Our
advisor has no previous experience operating a REIT. Our Chairman and CEO   
controls and has an indirect ownership interest in our advisor. Our senior  
  management also has major management responsibilities with our advisor and its
affiliates and will not spend their full time on our affairs. We have no    
ownership interest in our advisor.                                          

- Our advisor may face various conflicts of interest resulting from its         
activities with affiliated entities. The advisory services agreement was not
negotiated at arm's length, and our advisor and its affiliates will receive 
  substantial asset management, acquisition and sales fees that are not based on
our performance.                                                            

- If we do not raise at least approximately $29.5 million (not including any    
accrued interest on our affiliate line of credit or amounts distributed to  
 stockholders from offering proceeds) by January 1, 2007 (the maturity date of
our affiliate line of credit), we will lose our interests in all of our     
  communities described in this prospectus. We cannot assure you that the lender
under our affiliate line of credit will grant us any extensions of the      
maturity date of such line of credit beyond January 1, 2007.                

- We may not have available operating cash flows from any of the communities    
described in this prospectus to pay distributions to stockholders.          

- We have no limitations in our organizational documents regarding the amount of
 mortgage and other borrowings on our communities, provided, however, that the
aggregate amount of our indebtedness outstanding at any time may not exceed 
  300% of our net assets. High amounts of leverage may reduce cash available for
distributions to stockholders.                                              

- We are not yet a REIT and may be unable to qualify as a REIT beginning with   
the tax year ended December 31, 2005 and subsequent tax years; if we fail to
qualify and to remain qualified as a REIT, our distributions will not be    
  deductible by us, and our income will be subject to taxation. This will reduce
our earnings available for distribution to stockholders.                    

- Your shares will not be listed on a national securities exchange or market.   
Therefore, it will be difficult to sell your shares promptly, and if you are
  able to sell your shares, the sale price may reflect a loss from the price you
paid.                                                                       

- If this offering continues after our affiliate line of credit has been repaid,
we will acquire interests in additional communities, which will be a "blind 
pool" that you will not have the opportunity to evaluate prior to purchasing
shares in the offering.                                                     

- We will pay selling commissions to broker-dealers of 7.0% and a dealer-       
 manager fee to Boston Capital Securities, Inc. for reimbursement of marketing
expenses of 2.0% out of the offering proceeds raised. We will pay an        
additional approximately 5.45% of the offering proceeds in fees and expenses
to our affiliates for services and as reimbursement for offering- and       
 acquisition-related expenses incurred on our behalf. We will not have as much
of the offering proceeds to invest in communities as a result of these      
 payments, which may inhibit our efforts to achieve our investment objectives.
We will invest approximately 84.55% of the offering proceeds in apartment   
  communities. Until the line of credit attributable to each community is repaid
by the due date of January 1, 2007, effectively all cash flow generated by  
such community will be paid to BCP Funding, LLC, an affiliate of our Company
or, in the case of our Plano community, to Wachovia Bank, National          
Association.                                                                

- We expect to make distributions that include a return of capital, and to the  
extent we do so prior to the repayment of our affiliate line of credit, will
have less funds available to pay our affiliate line of credit. We may use   
various non-operational sources of cash in order to pay such distributions. 
For example, we could borrow funds on a short term basis. We could also sell
 additional shares of stock or we could sell some of our communities. If we do
  any of the foregoing, we may decrease cash available for future distributions.
To the extent we make distributions in excess of our current or accumulated 
earnings and profits, the distribution will be treated first as a tax-free  
return of capital, reducing the tax basis in each U.S. stockholder's shares,
and the amount of each distribution in excess of a U.S. stockholder's tax   
basis in its shares will be taxable as gain realized from the sale of its   
shares.                                                                     

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                                            PER SHARE         MINIMUM TOTAL         MAXIMUM TOTAL         
----------------------------------------------------------------------------------------------------------
                                                                                                          
Public offering price                        $10.00            $2,500,000           $1,000,000,000        
----------------------------------------------------------------------------------------------------------
Selling commissions and fees                 $ 0.90            $  225,000           $  90,000,000         
----------------------------------------------------------------------------------------------------------
Proceeds, before expenses, to the                                                                         
  Company                                    $ 9.10            $2,275,000           $ 910,000,000         
----------------------------------------------------------------------------------------------------------

The dealer-manager, Boston Capital Securities, Inc., is conducting this offering
on a best efforts basis. The dealer-manager must sell a minimum of 250,000      
shares if any are sold. The dealer-manager is required to use only its best     
efforts to sell the maximum number of 100,000,000 shares offered, which does not
include the 5,000,000 shares offered pursuant to our dividend reinvestment plan.
The 5,000,000 shares offered pursuant to the dividend reinvestment plan are     
offered initially at $9.30 per share with a dealer-manager fee of 2.0%. If the  
plan is fully sold, the total offering price for the 5,000,000 plan shares would
be $46,500,000, the total fees would be $930,000 and the proceeds before        
expenses to the Company would be $45,570,000.                                   

Neither the Securities and Exchange Commission nor any state securities         
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a     
criminal offense.                                                               

These are speculative securities. You should purchase these securities only if  
you can afford the complete loss of your investment.                            

The use of forecasts in this offering is prohibited. any representation to the  
contrary and any predictions, written or oral, as to the amount or certainty of 
any present or future cash benefit or tax consequence which may flow from an    
investment in this program is not permitted.                                    

The date of this prospectus is      , 2006. 

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INVESTOR SUITABILITY STANDARDS

The shares we are offering are suitable only as a long-term investment for      
persons of adequate financial means. We do not expect to have a public market   
for the shares, which means that it may be difficult for you to sell your       
shares. You should not buy these shares if you need to sell them immediately or 
will need to sell them quickly in the future.                                   

In consideration of these factors, we have established suitability standards for
initial stockholders. These suitability standards require that a purchaser of   
shares has either:                                                              

- a net worth of at least $150,000; or                                          

- a gross annual income of at least $45,000 and a net worth of at least $45,000.

Net worth shall be determined exclusive of the value of a purchaser's home, home
furnishings and automobiles.                                                    

The minimum purchase is 100 shares ($1,000), except in certain states as        
described below. You may not transfer fewer shares than the minimum purchase    
requirement. In addition, you may not transfer, fractionalize or subdivide your 
shares so as to retain less than the number of shares required for the minimum  
purchase. In order to satisfy the minimum purchase requirements for retirement  
plans, unless otherwise prohibited by state law, a husband and wife may jointly 
contribute funds from their separate IRAs, and jointly meet suitability         
standards, provided that each such contribution is made in increments of $100.  
You should note that an investment in shares of our Company will not, in itself,
create a retirement plan and that, in order to create a retirement plan, you    
must comply with all applicable provisions of the Internal Revenue Code.        

The minimum purchase for Maine, New York and North Carolina residents is 250    
shares ($2,500), except for IRAs which must purchase a minimum of 100 shares    
($1,000). The minimum purchase for Minnesota residents is 250 shares ($2,500),  
except for IRAs and other qualified retirement plans which must purchase a      
minimum of 200 shares ($2,000). Following an initial subscription for at least  
the required minimum investment, any investor may make additional purchases in  
increments of at least ten shares ($100), except for purchases made by residents
of Maine and Minnesota, whose additional investments must meet their state's    
minimum investment amount, and purchases of shares pursuant to our dividend     
reinvestment plan, which may be in lesser amounts.                              

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Several states have established suitability standards different from those we   
have established. Shares will be sold only to investors in these states who meet
the special suitability standards set forth below.                              

Arizona, California, Iowa, Massachusetts, Michigan, Missouri, North Carolina,   
New Mexico, Texas and Tennessee--Investors must have either (i) a net worth of  
at least $225,000 or (ii) gross annual income of $60,000 and a net worth of at  
least $60,000.                                                                  

Maine--Investors must have either (i) a net worth of at least $200,000 or       
(ii) gross annual income of $50,000 and a net worth of at least $50,000.        

Iowa, Michigan, Missouri, Ohio, Oregon and Pennsylvania--In addition to our     
suitability requirements, investors must have a net worth of at least ten times 
their investment in our Company.                                                

New Hampshire--Investors must have either (i) a net worth of at least $250,000  
or (ii) taxable income of $50,000 and a net worth of at least $125,000.         

Kansas--Investors must have either (i) gross annual income of at least $60,000  
and a net worth of at least $60,000; or (ii) a minimum net worth of at least    
$225,000 plus a liquid net worth of at least ten times their investment in the  
Company.                                                                        

Because the minimum offering of our common stock is less than $50,000,000,      
Pennsylvania investors are cautioned to carefully evaluate our ability to fully 
accomplish our stated objectives and to inquire as to the current dollar volume 
of Company subscriptions.                                                       

We will place all Pennsylvania investor subscriptions in escrow until we have   
received total subscriptions of at least $50,000,000, or for an escrow period of
120 days, whichever is shorter.                                                 

If we have not received total subscriptions of at least $50,000,000 by the end  
of the escrow period, we must:                                                  

A.  Return the Pennsylvania investors' funds within 15 calendar days of the end 
of the escrow period; or                                                

B.  Notify the Pennsylvania investors in writing by certified mail or any other 
   means whereby receipt of delivery is obtained within 10 calendar days after
  the end of the escrow period, that the Pennsylvania investors have a right
to have their investment returned to them. If an investor requests the  
   return of such funds within 10 calendar days after receipt of notification,
   the Company must return such funds within 15 calendar days after receipt of
the investor's request.                                                 

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No interest is payable to an investor who requests a return of funds at the end 
of the initial 120-day escrow period. Any Pennsylvania investor who requests a  
return of funds at the end of any subsequent 120-day escrow period will be      
entitled to receive interest earned, if any, for the time that the investor's   
funds remain in escrow commencing with the first day after the initial 120-day  
escrow period.                                                                  

In the case of sales to fiduciary accounts, these suitability standards must be 
met by the fiduciary account, by the person who directly or indirectly supplied 
the funds for the purchase of the shares or by the beneficiary of the account.  
These suitability standards are intended to help ensure that, given the         
long-term nature of an investment in our shares, our investment objectives and  
the relative illiquidity of our shares, our shares are an appropriate investment
for those of you desiring to become stockholders. Each participating            
broker-dealer must make every reasonable effort to determine that the purchase  
of shares is a suitable and appropriate investment for each stockholder based on
information provided by the stockholder in the subscription agreement, a form of
which accompanies this prospectus as Exhibit B. Each participating broker-dealer
is required to maintain for six years records of the information used to        
determine that an investment in the shares is suitable and appropriate for a    
stockholder.                                                                    

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TABLE OF CONTENTS 
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Special Note Regarding Forward-Looking Statements...........   10         
Prospectus Summary..........................................   11         
Risk Factors................................................   42         
  Risks Related to Our Properties and Our Business..........   42         
    Borrowing creates risks that the offering proceeds may                
      be insufficient to pay the non-recourse acquisition                 
      debt on the properties or our cash flow may be                      
      insufficient to meet our debt obligations.............   42         
    Adverse economic conditions and competition may impede                
      our ability to renew leases or re-lease units as                    
      leases expire and require us to undertake unbudgeted                
      capital improvements, which could harm our business                 
      and operating results.................................   42         
    Our financial covenants may restrict our operating                    
      activities, which may harm our financial condition and              
      operating results.....................................   43         
    Our working capital reserves may not be adequate to                   
      cover all of our cash needs, in which case we will                  
      have to obtain financing from other sources...........   44         
    Our advisor may not be successful in identifying                      
      suitable additional acquisitions that meet our                      
      criteria..............................................   44         
    We face competition for the acquisition of apartment                  
      communities, which may impede our ability to make                   
      future acquisitions or may increase the cost of                     
      acquisitions..........................................   44         
    Rising operating expenses could reduce our cash flow and              
      funds available for future distributions..............   45         
    Renovation of properties may result in increased costs                
      and loss of income during the renovation period.......   45         
    Development and construction of properties may result in              
      delays and increased costs and risks..................   46         
    Discovery of previously undetected environmentally                    
      hazardous conditions and physical defects may                       
      adversely affect our operating results................   46         
    We may face conflicts with sellers, partners and joint                
      venturers.............................................   47         
    The liquidation of our assets may be delayed............   48         
    We expect to make distributions that include a return of              
      capital...............................................   48         
  Risks Related to Our Organization and Structure...........   49         
    The board of directors can take many actions without                  
      stockholder approval..................................   49         
    Our organizational documents contain provisions which                 
      may discourage a takeover of our Company and depress                
      our stock price.......................................   49         
    Our business will be harmed if we cannot engage and                   
      retain the services of reputable and reliable managers              
      for our properties....................................   51         
    Our rights and the rights of our stockholders to take                 
      action against our directors and officers are                       
      limited...............................................   51         
    Mortgage debt obligations expose us to increased risk of              
      loss of property, which could harm our financial                    
      condition.............................................   52         

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  Illiquidity of real estate investments could                          
    significantly impede our ability to respond to adverse              
    changes in the performance of our properties and harm               
    our financial condition...............................   52         
  If we suffer losses that are not covered by insurance or              
    that are in excess of our insurance coverage limits,                
    we could lose invested capital and anticipated                      
    profits...............................................   53         
  Your interest in our Company may be diluted if we issue               
    additional shares and your distributions may be                     
    affected..............................................   53         
Risks Related to this Offering............................   53         
  We are dependent on our advisor and the property                      
    managers..............................................   53         
  We have a limited operating history.....................   54         
  Payment of fees to our advisor and its affiliates were                
    not determined in arm's length negotiations and will                
    reduce cash available for investment and                            
    distribution..........................................   54         
  The performance of our properties during the period                   
    before our initial line must be repaid may not meet                 
    our expectations......................................   54         
  If we do not raise sufficient funds to repay the amounts              
    we borrowed to acquire our interests in our initial                 
    ten communities, we will lose our interests in all our              
    communities still subject to lender liens.............   55         
  Until we repay at least the approximately $29.5 million               
    (not including any accrued interest on our affiliate                
    line of credit or amounts distributed to stockholders               
    from offering proceeds) borrowings related to our                   
    Jacksonville communities, no operating cash flow from               
    any of our communities will be available to make                    
    distributions to our stockholders.....................   55         
  We may not have available operating cash flows from any               
    of the communities described in this prospectus to pay              
    distributions to shareholders.........................   56         
  We are dependent on the dealer-manager..................   56         
  Stockholders may not be able to liquidate their                       
    investment promptly at a reasonable price.............   57         
  You cannot evaluate all of the properties we may own....   57         
  Limited diversification increases risk of loss..........   57         
  Our management and that of our advisor have little                    
    experience investing in market rate apartment                       
    communities and no experience operating a REIT........   58         
  You are limited in your ability to sell your shares                   
    pursuant to our share redemption program..............   58         
  An independent underwriter will not make an independent               
    investigation of our Company or the prospectus which                
    are customarily performed in underwritten offerings...   59         
  There has been no public market for our common stock....   59         
Conflicts of Interest Risks...............................   59         
  There are certain relationships between our Company and               
    other entities providing services to us...............   59         

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    The directors may determine in the future that it may be              
      in the best interest of our Company to become                       
      completely or partially self-administered.............   60         
    We will experience competition for properties...........   60         
    There will be competing demands on our officers and                   
      directors.............................................   60         
    The timing of acquisitions and sales may favor our                    
      advisor...............................................   61         
    We have borrowed from an affiliate of our advisor and an              
      affiliate of our advisor has guaranteed certain of our              
      debt..................................................   61         
    We may invest with affiliates of our advisor............   61         
    There is no separate counsel for our Company, our                     
      affiliates and stockholders...........................   62         
    Your subscription payment is irrevocable................   62         
  Tax and Employee Benefit Plan Risks.......................   62         
    If we fail to remain qualified as a REIT, our                         
      distributions will not be deductible by us, and our                 
      income will be subject to taxation, reducing our                    
      earnings available for distribution...................   62         
    Because we acquired properties prior to qualification as              
      a REIT, we may face certain tax consequences..........   62         
    Even REITs are subject to federal and state income                    
      taxes.................................................   63         
    An investment in our common stock may not be suitable                 
      for every employee benefit plan.......................   64         
    Investor Suitability Standards..........................   64         
    Estimated Use of Proceeds...............................   67         
Distribution Policy.........................................   72         
Business and Properties.....................................   73         
    Overview................................................   73         
    Property Selection Process..............................   73         
    Properties..............................................   75         
    Property Management.....................................  120         
    Selection of Managers...................................  120         
    Property Management Agreements and Plans................  121         
    Property Development and Construction...................  124         
    Joint Venture Investments...............................  125         
    Competition.............................................  125         
    Offices.................................................  126         
    Line of Credit..........................................  126         
    Mortgage Indebtedness...................................  128         
Selected Financial Data.....................................  129         
Management's Discussion and Analysis of Financial Condition               
  and Results of Operations.................................  131         
    Liquidity and Capital Resources.........................  133         
    Results of Operations...................................  135         
    Related Party Transactions..............................  146         
    Critical Accounting Policies............................              

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Management..................................................  147         
    General.................................................  147         
    Directors and Executive Officers........................  148         
    Independent Directors...................................  154         
    Committees of the Board of Directors....................  154         
    Compensation of Directors and Executive Officers........  155         
    Equity Incentive Plan...................................  156         
    Non-qualified Stock Options.............................  156         
    Restricted Stock........................................  156         
    Unrestricted Stock......................................  157         
    Performance Share Awards................................  157         
    Indemnification.........................................  157         
    Our Advisor and the Advisory Services Agreement.........  158         
    The Advisory Services Agreement.........................  160         
    Other Affiliated Companies..............................  163         
    Dealer-Manager..........................................  163         
    Management Decisions....................................  164         
Compensation and Fees.......................................  164         
Conflicts of Interest.......................................  175         
    There are Certain Relationships Between Our Company and               
      Other Entities Providing Services to Us...............  175         
    Prior and Future Programs...............................  177         
    Competition to Acquire Properties.......................  177         
    Sales of Properties.....................................  177         
    Competition for Management Time.........................  178         
    Compensation of Our Advisor.............................  178         
    Relationship with the Dealer-Manager....................  179         
    Relationship with BCP Funding, LLC......................  179         
    Joint Ventures with Affiliates of Our Advisor...........  179         
    Legal Representation....................................  180         
    Certain Conflict Resolution Procedures..................  180         
    Conflict Provisions of Maryland Law.....................  182         
Investment Policies and Policies with Respect to Certain                  
  Other Activities..........................................  182         
    Investments in Real Estate..............................  182         
    Borrowing Policies......................................  184         
    Dispositions............................................  186         
    Equity Capital Policies.................................  186         
    Reporting Policies......................................  186         
    Investment Limitations..................................  187         
Prior Performance of Affiliates of Management...............  187         
    Overview................................................  187         
    Private Placements......................................  189         

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    Public Offerings........................................  190         
Principal Stockholders......................................  195         
Description of Capital Stock................................  196         
    General.................................................  196         
    Authorized Stock........................................  196         
    Common Stock............................................  196         
    Preferred Stock; Other Equity Securities................  197         
    Restrictions on Ownership...............................  198         
    Inspection of Books and Records.........................  200         
    Restriction on "Roll-Up" Transactions...................  201         
    Certain Provisions of Maryland Law and of Our Articles                
      and Bylaws............................................  202         
    Termination of Our Company and REIT Status..............  202         
    Amendment of Articles and Bylaws........................  203         
    Meetings of Stockholders................................  203         
    Advance Notice Provisions for Stockholder Nominations                 
      and Stockholder Proposals.............................  204         
    The Board of Directors..................................  204         
    Business Combinations...................................  205         
    Control Share Acquisition...............................  206         
    Anti-takeover Legislation...............................  206         
Material United States Federal Income Tax Considerations....  208         
    General.................................................  208         
    Taxation of the Company.................................  210         
    Taxation of Taxable U.S. Stockholders...................  219         
    Taxation of Tax-Exempt U.S. Stockholders................  223         
    Taxation of Non-U.S. Stockholders General...............  224         
    Other Tax Considerations................................  227         
    ERISA Considerations....................................  227         
    Plan Considerations.....................................  227         
    Annual Valuation........................................  230         
Summary of Reinvestment Plan................................  231         
Share Redemption Program....................................  233         
Selling and Escrow Arrangements.............................  236         
    Selling Arrangements....................................  236         
    Escrow Arrangements.....................................  241         
    Market for Our Stock....................................  242         
Supplemental Sales Material.................................  243         
Experts.....................................................  244         
Legal Matters...............................................  244         
Where You Can Find More Information.........................  244         
Index to Financial Statements...............................  F-1         
Appendix I: Tabular Information Concerning Prior Limited                  
  Partnerships..............................................  I-1         
Exhibit A: Reinvestment Plan................................  A-1         
Exhibit B: Subscription Agreement...........................  B-1         
--------------------------------------------------------------------------

You should rely only on the information contained in this prospectus. No dealer,
salesman or any other person has been authorized to provide you with different  
information. If anyone provides you with different or inconsistent information, 
you should not rely on it. This prospectus does not                             

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constitute an offer to sell these securities in any jurisdiction where that     
offer or sale is not permitted. We will only accept subscriptions from people   
who meet the suitability standards described in this prospectus. You should     
assume that the information appearing in this prospectus is accurate only as of 
the date on the front cover of this prospectus. Our business, financial         
condition, results of operations and prospects may have changed since that date.
We will amend or supplement this prospectus, however, if there is a material    
change in our affairs.                                                          

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 

Some of the statements contained in "Prospectus Summary," "Risk Factors,"       
"Distribution Policy," "Business and Properties," "Selected Financial Data,"    
"Management's Discussion and Analysis of Financial Condition and Results of     
Operations," "Investment Policies and Policies with Respect to Certain          
Activities" and elsewhere in this prospectus constitute forward-looking         
statements. Forward-looking statements relate to expectations, beliefs,         
projections, future plans and strategies, anticipated events or trends and      
similar expressions concerning matters that are not historical facts. In some   
cases you can identify forward-looking statements by terms such as "may,"       
"will," "should," "expects," "plans," "anticipates," "believes," "estimates,"   
"predicts," "potential" or the negative of these terms or other comparable      
terminology.                                                                    

The forward-looking statements contained in this prospectus reflect our current 
views about future events and are subject to risks, uncertainties, assumptions  
and changes in circumstances that may cause our actual results to differ        
significantly from those expressed in any forward-looking statement. The factors
that could cause actual results to differ materially from expected results      
include changes in economic, business and competitive market conditions. For    
more information regarding risks that may cause our actual results to differ    
materially from any forward-looking statements, see "Risk Factors" beginning on 
page 42. We do not intend and disclaim any duty or obligation to update or      
revise any industry information or forward-looking statements set forth in this 
prospectus to reflect new information, future events or otherwise.              

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PROSPECTUS SUMMARY

The following summary highlights the material information contained elsewhere in
this prospectus. You should read the entire prospectus, including "Risk         
Factors," before making a decision to invest in our common stock. In this       
prospectus, unless the context indicates otherwise, references to "we," "our,"  
"us," "our Company," "the Company" or "Boston Capital REIT" refer to Boston     
Capital Real Estate Investment Trust, Inc. References to the dealer-manager     
refer to our affiliate, Boston Capital Securities, Inc. References to "our      
advisor" refer to our affiliate, Boston Capital REIT Advisors, LLC. References  
to "our initial ten communities" refer to our apartment communities in          
Jacksonville, Florida, Portland, Oregon, Seattle, Washington and Salt Lake City,
Utah. References to our Plano community refer to the Broadstone Preston at      
Willow Bend apartments located in Plano, Texas. References to "our affiliate    
line of credit" refer to an initial $60,000,000 loan agreement with BCP Funding 
LLC, our affiliate and an affiliate of our advisor pursuant to which we borrowed
$56,596,665 to acquire interests in our initial ten communities. References to  
the Wachovia loan refer to a $5,556,348 loan agreement with Wachovia Bank,      
National Association used to fund a portion of the purchase price of our Plano  
community. Unless otherwise indicated, the information contained in this        
prospectus with regard to the amount of funds we will need to raise in this     
offering in order to repay our affiliate line of credit, the second mortgage    
debt on our Seattle community and/or the Wachovia loan has been determined      
without taking into account that until such time as we have sufficient cash flow
from operations to fund the payment of future distributions, we anticipate using
the proceeds of this offering to fund all or a significant portion of initial   
distributions to our stockholders. See "Risk Factors--Risks Related to the      
Offering --Until we repay at least the approximately $29.5 million (not         
including any accrued interest on our affiliate line of credit or amounts       
distributed to stockholders from offering proceeds) in borrowings related to our
Jacksonville communities, no operating cash flow from any of our communities    
will be available to make distributions to our stockholders."                   

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

BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC. 

Overview

We were formed in Maryland on May 2, 2003, and commenced operations on May 15,  
2003. We intend to qualify as a real estate investment trust, or REIT, beginning
with the tax year ended December 31, 2005. Our objective is to generate stable  
and increasing cash flow and asset value by                                     

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managing apartment communities in the United States. There is no assurance we   
will meet our objective. To date, we have acquired eleven apartment communities 
consisting of 3,098 units and comprising approximately 2,173,000 square feet    
located in Jacksonville, Florida, Portland, Oregon, Seattle, Washington, Salt   
Lake City, Utah and Plano, Texas, for an aggregate total investment of          
approximately $62,153,013. We borrowed the $56,596,665 invested in our initial  
ten communities from an affiliate as described below. Our Seattle communities   
are encumbered by second mortgage debt (subordinate to the permanent mortgage   
financing) in the original principal amount of $8,120,000 from an unaffiliated  
lender, which will also be repaid with the proceeds from this offering. In      
addition, we borrowed approximately $5,556,348 to fund a portion of the purchase
price of our Plano community from Wachovia Bank, National Association and       
financed the remainder of the purchase price with a mortgage of $11,981,000.    
Accordingly, we will need to raise approximately $74,495,922 (not including any 
accrued interest on our affiliate line of credit or amounts distributed to      
stockholders from offering proceeds) in order to repay amounts borrowed under   
our affiliate line of credit related to the Jacksonville, Portland and Salt Lake
communities and to repay the second mortgage debt on our Seattle property. In   
order to retain all of our eleven communities, including our Plano community, we
will need to raise $74,495,922 (not including any accrued interest on our       
affiliate line of credit or amounts distributed to stockholders from offering   
proceeds) by January 1, 2007 and, at that time, repay the Wachovia loan with    
either borrowings under an anticipated line of credit or by refinancing         
permanent mortgage debt on our communities, or to the extent that we have raised
approximately $80,890,183 (not including any accrued interest on our affiliate  
line of credit or the Wachovia loan or amounts distributed to stockholders from 
offering proceeds) by January 1, 2007, with the proceeds received from this     
offering. After we have raised $74,495,922, (not including any accrued interest 
on our affiliate line of credit or amounts distributed to stockholders from     
offering proceeds) and repaid the Wachovia loan, we will acquire interests in   
additional communities, which you may not have the opportunity to evaluate prior
to purchasing shares in this offering. Accordingly, this offering is termed an  
unspecified property or "blind pool" offering. Our interest in each apartment   
community (or, where appropriate, each related group of communities) is owned by
a limited liability Company or other entity wholly owned by us. The apartment   
communities themselves are owned by subsidiaries of limited liability companies 
in which our subsidiary-owner companies own the equity interest and in which    
unaffiliated third parties have a subordinated economic interest.               

We have borrowed and may continue to borrow money to acquire interests in       
communities by obtaining one or more lines of credit. We do this                

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in order to control suitable communities prior to sufficient funds being raised 
in this offering. We entered into an initial $60,000,000 loan agreement with BCP
Funding, LLC, our affiliate and an affiliate of our advisor. We borrowed        
$56,596,665 to acquire interests in our initial ten communities. The line bears 
"base" interest at 9.5% and "bonus" interest at 5.3%, which was not negotiated  
at arm's length. Base interest is due and payable with respect to each calendar 
quarter to the extent of cash available for debt service for the current        
quarter. Base interest shall accrue in arrears and any unpaid base interest     
shall accrue and be added to principal. Bonus interest is due and payable with  
respect to each calendar quarter to the extent of cash available for debt       
service after payment of base interest. Any unpaid bonus interest shall accrue  
but will not be added to principal. Accrued bonus interest shall be payable     
quarterly solely from cash available for debt service after payment of the      
current quarter base and bonus interest. Any accrued bonus interest not paid on 
or before the maturity date shall not be due or payable. We do not believe that 
sufficient cash flow will exist to pay bonus interest; therefore no accrual for 
it has been made in our financial statements. Our interests in our initial ten  
communities are subject to the lien of BCP Funding, LLC. Until the line of      
credit attributable to each community is repaid, effectively all cash flow      
generated by such community will be paid to BCP Funding, LLC. Once we repay the 
line of credit indebtedness for each community, BCP Funding, LLC's lien will be 
released as to that community. BCP Funding, LLC, is wholly owned by Boston      
Capital Companion Limited Partnership. John P. Manning, our Chairman and Chief  
Executive Officer, owns the general partner of and a limited partner interest in
Boston Capital Companion Limited Partnership. This line of credit is            
non-recourse to our Company and is secured by our interests in our initial ten  
communities.                                                                    

If we raise at least approximately $29.5 million (not including any accrued     
interest on our affiliate line of credit or amounts distributed to stockholders 
from offering proceeds) by January 1, 2007, we will repay all of our outstanding
indebtedness attributable to our Jacksonville communities from the proceeds of  
this offering, and BCP Funding, LLC will release its lien on our interests in   
those communities. We anticipate that the balance of our outstanding borrowings 
under our affiliate line of credit will be repaid by January 1, 2007. If        
sufficient additional shares are not sold, and the balance of our outstanding   
indebtedness under our affiliate line of credit is not repaid, we will lose our 
interests in the communities still subject to the liens of our affiliate line of
credit. Specifically,                                                           

- Unless we raise $2.5 million by January 1, 2007, we will lose our interests in
 all eleven of our communities and all investor funds then held in escrow will
 be returned with interest (currently 3.35%; such rate can adjust similar to a
bank passbook savings rate).                                                

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- Unless we raise at least approximately $29.5 million (not including any       
accrued interest on our affiliate line of credit or amounts distributed to  
stockholders from offering proceeds) by January 1, 2007, we will lose our   
interest in our Jacksonville communities and all our other communities.     

- In order to retain all of the 11 communities we have acquired, we will need to
raise approximately $74,495,922 (not including any accrued interest on our  
 affiliate line of credit or amounts distributed to stockholders from offering
proceeds) by January 1, 2007 and at that time repay the Wachovia loan with  
either borrowings under an anticipated line of credit or by refinancing     
permanent mortgage debt on our communities, or to the extent that we have   
raised approximately $80,890,183 (not including any accrued interest on our 
affiliate line of creditor or the Wachovia loan or amounts distributed to   
stockholders from offering proceeds) by January 1, 2007, with the proceeds  
received from this offering.                                                

All of the communities that we have acquired interests in to date are also      
encumbered by permanent mortgage indebtedness which will not be repaid from the 
proceeds of this offering.                                                      

After the borrowings under our affiliate line of credit have been repaid, we    
will pursue one or both of two alternatives for acquiring interests in          
additional communities. One, our board of directors may determine to establish  
one or more new lines of credit to be used to purchase interests in additional  
communities and to repay those borrowings as sufficient funds are raised from   
the sale of additional shares. If our board determines to repeat this           
reborrowing and repayment process, it is possible that any new borrowing will be
secured by our interests in all of our communities. Alternatively, our board may
determine to acquire additional interests in communities as sufficient funds are
raised. In this alternative, no funds would have to be borrowed under any line  
of credit to acquire interests in communities. Whichever alternative is used,   
our board of directors anticipates that every community we invest in will be    
encumbered by mortgage indebtedness, that the aggregate amount of the mortgage  
indebtedness on our communities that are no longer (or have not been) financed  
with our affiliate line of credit or any replacement line of credit is projected
to be within the targeted range of 55% to 65% but in any event will not be more 
than 70% of the gross asset value of those communities. Gross asset value means 
the total purchase price of our properties, including property-level acquisition
costs, closing costs and reserves, company-level acquisition fees, company-level
capitalized expenses and company-level reserves or the value reported in the    
most recent appraisal of the properties, whichever is later. However, we have no
limitations in our organizational documents regarding the amount of mortgage and
other borrowings                                                                

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on our communities, other than that the aggregate amount of our indebtedness    
outstanding at any time may not exceed 300% of our net assets. Net assets means 
our total assets, other than intangibles, at cost before deducting depreciation 
or other non-cash reserves less our total liabilities, calculated at least      
quarterly on a basis consistently applied. Any borrowings in excess of this 300%
level will be approved by a majority of our independent directors and disclosed 
to our stockholders in our next quarterly report, along with a justification for
such excess. (At the commencement of this offering and prior to the repayment of
our affiliate line of credit from the proceeds of this offering, the combination
of the amount outstanding under our affiliate line of credit and the amount of  
permanent mortgage indebtedness exceeds 300% of our net assets). We will        
supplement or amend this prospectus from time to time as necessary to describe  
the procedures we will follow after the repayment of our affiliate line of      
credit.                                                                         

We maintain our principal office at One Boston Place, Suite 2100, Boston,       
Massachusetts 02108-4406. All mailings to that address should be labeled "c/o   
Boston Capital Corporation." Our telephone number is (617) 624-8900. We have    
established an internet-accessible area for our Company on the website of Boston
Capital Corporation, www.bostoncapital.com. The information on our website does 
not constitute a part of this prospectus.                                       

Our Advisor 

Our advisor is Boston Capital REIT Advisors, LLC, an affiliate of our Company,  
which is entirely responsible for managing our affairs on a day-to-day basis and
for identifying and making, subject to the approval of our board of directors,  
acquisitions on our behalf. Our Company has no employees of its own. Boston     
Capital REIT Advisors, LLC, is wholly owned by Boston Capital Holdings Limited  
Partnership. John P. Manning, our Chairman and Chief Executive Officer, owns the
general partner of and a limited partner interest in Boston Capital Holdings    
Limited Partnership.                                                            

Our Management

Our board of directors must approve each acquisition proposed by our advisor, as
well as certain other matters set forth in our articles of incorporation. We    
have five members on our board of directors. The majority of the directors are  
independent of our advisor and have responsibility for reviewing its            
performance. Our directors are elected annually by the stockholders. John P.    
Manning, who is one of our directors, our Chairman and our Chief Executive      
Officer, is responsible for our formation and commencement of business.         

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Risk Factors

You should carefully consider the matters discussed in the section "Risk        
Factors" beginning on page 42 prior to deciding whether to invest in our common 
stock. Some of these risks include:                                             

- You must rely on our advisor, which, together with our board of directors, has
responsibility for the management of our business and the selection of our  
apartment communities. Our officers and directors (apart from two of our    
independent directors) and those of our advisor have no previous experience 
 operating a REIT, which could adversely affect our business. Our Chairman and
  CEO controls and has an indirect ownership interest in our advisor. Our senior
  management also has major management responsibilities with our advisor and its
affiliates and may not spend their full time on our affairs. We have no     
ownership interest in our advisor.                                          

- Our advisor may face various conflicts of interest resulting from its         
activities with affiliated entities. The advisory services agreement was not
negotiated at arm's length, and our advisor and its affiliates will receive 
  substantial asset management, acquisition and sales fees that are not based on
our performance.                                                            

- Our advisor was not involved in the initial formation transactions for the    
Seattle communities. Initially, an affiliate of our advisor, BC-GFS LLC was 
formed and controlled by John P. Manning, our Chairman and Chief Executive  
Officer, to acquire the Seattle communities from Goodman Financial Services,
an unaffiliated entity.                                                     

- Our advisor will rely on third-party property managers for leasing,           
maintenance and other day-to-day management of our communities. If these    
managers are unable to operate our communities successfully, our financial  
condition could be adversely affected.                                      

- We have a $60,000,000 line of credit with BCP Funding, LLC, which we used in  
connection with the acquisition of our initial ten communities. For our     
 Seattle communities, we must raise sufficient funds in this offering not only
 to repay amounts borrowed under our affiliate line of credit related to those
communities but also to repay second mortgage debt (subordinate to the      
permanent mortgage financing) in the original principal amount of $8,120,000
from an unaffiliated lender encumbering those communities. We will use      
offering proceeds to repay all of this debt. The terms of our line of credit
 with BCP Funding, LLC were not the result of an arm's length negotiation. The
  base interest rate is 9.5% per annum plus bonus interest of 5.3% to the extent
of cash available for debt service after payment of base interest. Until the
affiliate line of credit attributable to each community is repaid by the due
date, effectively all cash flow generated by such community will be paid    

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 to BCP Funding, LLC or, in the case of our Plano community, to Wachovia Bank,
 National Association. The effective rate of interest is the stated 9.5% since
historically no bonus interest has been paid. Our affiliate line of credit  
matures on January 1, 2007. If we do not raise sufficient funds in this     
offering to repay the balance of our affiliate line of credit, we will lose 
our interest in the communities still subject to the liens of our           
line-of-credit lender. We cannot assure you that the lender under our       
 affiliate line of credit will grant us any extensions of the maturity date of
our affiliate line of credit beyond January 1, 2007. We also borrowed       
  $5,556,348 to fund a portion of the purchase price of our Plano community from
  Wachovia Bank, National Association. We intend to repay the Wachovia loan with
either borrowings under an anticipated line of credit or by refinancing     
permanent mortgage debt on our communities, or to the extent that we have   
raised approximately $80,890,183 (not including any accrued interest on our 
affiliate line of credit or the Wachovia loan or amounts distributed to     
stockholders from offering proceeds) by January 1, 2007, with the proceeds  
received from this offering. In connection with our procurement of the      
Wachovia loan, BCP Funding, LLC agreed that it will continue to receive     
 payment on our outstanding borrowings under our affiliate line of credit with
respect to our initial ten communities until all liens on such properties,  
other than the lien associated with our Seattle communities, are released.  
 Once all liens on our initial ten communities (with the exception of the lien
associated with the Seattle communities) are released, BCP Funding, LLC has 
agreed that we may utilize proceeds from this offering to pay the Wachovia  
loan before the payment of the borrowings associated with the Seattle       
communities.                                                                

- Our apartment communities are subject to permanent mortgage loans, which are  
  described in this prospectus. These loans will not be repaid from the proceeds
  of this offering and, accordingly, our communities will continue to be subject
to the liens of those lenders. We have no limitations in our organizational 
documents regarding the amount of mortgage and other borrowings on our      
 communities, provided, however, that the aggregate amount of our indebtedness
  outstanding at any time may not exceed 300% of our net assets. High amounts of
leverage may reduce cash available for distributions to stockholders. We    
cannot assure you that we will be able to meet our debt service obligations,
including interest costs which may be substantial. If we are unable to meet 
  our debt service obligations, we may lose our investment in any community that
  secures indebtedness on which we have defaulted. If we cross-collateralize our
communities, we may lose our investment in a good-performing community      
cross-collateralized with a poor-performing community.                      

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- Your shares will not be listed on a national securities exchange or market.   
Unless and until our shares are publicly traded, you will have a difficult  
 time selling your shares, and your shares may be subject to a market discount
from the proportionate value of real estate we own.                         

- Until we repay at least the approximately $29.5 million (not including any    
accrued interest on our affiliate line of credit or amounts distributed to  
  stockholders from offering proceeds) in borrowings related to our Jacksonville
communities, no operating cash flow from any of our communities will be     
available to make distributions to our stockholders.                        

- The specific investments in apartment communities described in this prospectus
represent approximately 8.0% of the maximum offering amount or approximately
  $80,890,183. If this offering continues after our affiliate line of credit has
been repaid, we will acquire interests in additional communities, which will
 be a "blind pool" that you will not have the opportunity to evaluate prior to
purchasing shares in this offering.                                         

- The number of apartment communities that we will own interests in and the     
  geographic diversity of our investments will be reduced to the extent that the
total proceeds of this offering are less than $1,000,000,000. If at least   
approximately $29.5 million (not including any accrued interest on our      
 affiliate line of credit or amounts distributed to stockholders from offering
  proceeds) is raised, we will have enough money to retain our interests only in
 our Jacksonville communities by repaying our borrowings from BCP Funding, LLC
plus our affiliates' fees and expenses related to Jacksonville. Limited     
diversification will increase the potential adverse effect on us of an      
underperforming property.                                                   

- We will pay selling commissions to broker-dealers of 7.0% and a dealer-       
 manager fee to Boston Capital Securities, Inc. for reimbursement of marketing
expenses of 2.0% out of the offering proceeds raised. We will pay an        
additional 5.45% of the offering proceeds in fees and expenses to affiliates
for services and as reimbursement for offering-and acquisition-related      
  expenses incurred on our behalf. The amount of proceeds that will be available
  to invest in communities will be decreased as a result of such payments, which
may inhibit our ability to meet our investment objectives. We will invest   
 84.55% of the offering proceeds in apartment communities. The broker-dealers,
dealer-manager and affiliates will be paid and will retain these fees       
regardless of the investment performance of the apartment communities.      

- Our board of directors will have significant flexibility regarding our        
operations. For example, our board has the ability to change investment     
objectives and policies, to issue additional shares and dilute stockholders'
  equity interests as well as to issue preferred stock with rights senior to our
common stock, which could include superior dividend rights                  

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that could result in our common stockholders receiving no dividend          
distributions. Our board also has the ability to change the compensation of 
our advisor and to employ and compensate affiliates. Our board of directors 
can take such actions solely on its own authority and without stockholder   
approval.                                                                   

- If the communities we own do not yield the returns we expect, we will have    
less income with which to pay distributions to our stockholders.            

- Adverse economic conditions and competition may impede our ability to renew   
leases or re-lease apartment units as leases expire and require us to       
undertake unbudgeted capital improvements, which could harm our business and
operating results.                                                          

- Our charter documents contain several anti-takeover provisions and a          
requirement that, with some exceptions, no person may actually or           
constructively own more than 9.8% of our capital stock, which may discourage
third parties from conducting a tender offer or seeking other change of     
control transactions that could involve a premium price for our shares or   
otherwise benefit our stockholders.                                         

- We may be unable to qualify as a REIT beginning with the tax year ended       
December 31, 2005 and subsequent tax years; if we fail to qualify and to    
remain qualified as a REIT, our distributions will not be deductible by us, 
and our income will be subject to taxation, reducing our earnings available 
for distribution.                                                           

- Some of the properties that we own and in which we intend to invest in are    
communities which our advisor believes are undervalued mainly because of    
deferred maintenance or renovations which the seller has not performed. For 
 any such communities, we will need to raise sufficient funds to make any such
  deferred maintenance or renovations. The risks of renovation include increases
in renovation costs, delays in completion, and loss of rental income during 
the renovation.                                                             

- We expect to make distributions that include a return of capital, and to the  
extent we do so prior to the repayment of our affiliate line of credit, we  
  will have less funds available to pay our affiliate line of credit. We may use
various non-operational sources of cash in order to meet the distribution   
requirements that are necessary to achieve and maintain REIT status. For    
example, we could borrow funds on a short-term basis. We could also sell    
additional shares of stock or some of our communities. If we do any of the  
foregoing, we may decrease cash available for future distributions.         

- Our income depends on the income or profits derived by our subsidiaries, who  
hold the fee simple title to the communities.                               

- None of our tax losses will be passed through to you.                         

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Our Investment Objectives 

Our policy is to acquire assets primarily for current income generation.        
Currently, some of the properties that we own and properties that we may        
purchase in the future are communities which our advisor believes are           
undervalued mainly because of deferred maintenance or renovations which the     
seller has not performed. For any such communities, we will need to raise       
sufficient funds to make any such deferred maintenance or renovations. In       
addition, we invest in properties located in markets which offer favorable value
and growth prospects. In general, our investment objectives are:                

- To provide regular quarterly cash distributions, as well as to provide growth 
in distributions over time.                                                 

- To increase our value through increases in the cash flows and values of our   
apartment communities.                                                      

- To preserve and protect the value of our interest in our communities and      
secondarily to achieve long-term capital appreciation.                      

The achievement of these objectives is not guaranteed.                          

Restrictions on Ownership of Our Capital Stock

Due to limitations on the concentration of ownership of REIT stock imposed by   
the Internal Revenue Code, and to address other concerns relating to            
concentration of capital stock ownership, our charter documents generally       
prohibit any stockholder from actually or constructively owning more than 9.8%  
of the outstanding shares of our capital stock.                                 

Our board of directors may, in its sole discretion, waive the ownership limit   
with respect to a particular stockholder if our board is presented with evidence
satisfactory to it that the ownership will not then or in the future jeopardize 
our status as a REIT.                                                           

Our Tax Status

We expect to elect to be taxed as a REIT under Sections 856 through 860 of the  
Internal Revenue Code beginning with the tax year ended December 31, 2005. We   
believe that we are organized in conformity with the requirements for           
qualification as a REIT under the Internal Revenue Code, and that our manner of 
operation will enable our Company to meet the requirements for taxation as a    
REIT for federal income tax purposes, but cannot assure you that we will meet   
such requirements. To maintain REIT status, we must meet a number of            
organizational and operational requirements, including a requirement that we    
currently distribute at least 90% of our REIT taxable income to our             
stockholders. As a REIT, we generally will not be subject to federal income tax 
on REIT taxable income we distribute currently to our stockholders. If we fail  
to qualify as a REIT in any                                                     

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taxable year, we will be subject to federal income tax at regular corporate     
rates. Even if we qualify for taxation as a REIT, we may be subject to some     
federal, state and local taxes on our income and property.                      

Conflicts of Interest 

We have retained our advisor to provide us with acquisition, advisory and       
administrative services. Several of the executive officers of our advisor are   
also officers or directors of our Company. Some of our officers and directors,  
who are also officers of our advisor, may experience conflicts of interest in   
their management of our Company. These arise principally from their involvement 
in other activities that may conflict with our business and interests, including
matters related to:                                                             

- allocation of management time and services between us and various other       
 entities, principally approximately 387 other real estate investment programs
at the current time with interests in low-income residential apartment      
communities; it is expected that the number of such programs will increase; 

- the timing and terms of an investment in or sale of a community;              

- compensation to our advisor; and                                              

- our relationship with the dealer-manager, Boston Capital Securities, Inc.,    
which is our affiliate and an affiliate of our advisor. Our advisor and its 
affiliates, including the dealer-manager, will receive substantial fees,    
commissions, compensation and other income from transactions with and by us 
regardless of the success of your investment.                               

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The following chart shows our relationship to the various affiliated entities   
participating in this offering:                                                 

                                                        [Enlarge/Download Table]
                                                                                                                                   
                          *---------------------------------------------------------*                                              
*-------------------------*                                                         *                                              
*                         *                      JOHN P. MANNING                    *                                              
*      *------------------*                                                         *-----------------*                            
*      *                  *---------------------------------------------------------*                 *                            
*      *                     *                                                   *                    *                            
*      *                     * 100%                                              * 100%               *                            
*      *                     *                                                   *                    *                            
*      *          *-----------------------*                          *-----------------------*        *                            
*      *          *    BOSTON CAPITAL     *                          *     BOSTON CAPITAL    *        *                            
*      *          *     PARTNERS II       *                          *      CORPORATION      *        *                            
*      *          *     CORPORATION       *                          *   (GENERAL PARTNER)   *        *                            
*      *          *   (GENERAL PARTNER)   *                          *  (ORGANIZED IN 1994)  *        *                            
*      *          *-----------------------*                          *-----------------------*        *                            
*      * CONTROLLING LIMITED *                                                   *                    * LIMITED                    
*      * PARTNERSHIP         *                                                   *                    * PARTNERSHIP                
*      * INTEREST            * 0.01%                                             * 0.01%              * INTEREST                   
*    *----------------------------------------------*   *------------------------------------------------*                         
*    *           BOSTON CAPITAL COMPANION           *   *            BOSTON CAPITAL HOLDINGS             *                         
*    *             LIMITED PARTNERSHIP              *   *              LIMITED PARTNERSHIP               *                         
*    *----------------------------------------------*   *------------------------------------------------*                         
*      *                               *                        *                                     *                            
* 100% *                               * 20,000                 *                                     *                            
*      *                               * SHARES OF              * 66-2/3%                             * 100%                       
*      *                               * COMMON    *--------------------------*       *---------------------------*                
*      *                               * STOCK     *         BOSTON           *       *                           *                
*      * 100%                          *           *         CAPITAL          *       *      BOSTON CAPITAL       *                
*      *                               *           *     SECURITIES, INC.     *       *    REIT ADVISORS, LLC     *                
*      *                               *           *     (DEALER-MANAGER)     *       *         (ADVISOR)         *                
*      *                               *           *--------------------------*       *---------------------------*                
*      *                               *                        *                                     *                            
*      *                    LOAN       *                        * DEALER-MANAGER                      * ADVISORY                   
*   *---------------------* AGREEMENT  *                        * AGREEMENT                           * AGREEMENT                  
*   *    BCP FUNDING,     *         *------------------------------------------------------------------------------------*         
*   *        LLC          *---------*                    BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC.               *         
*   *      (LENDER)       *         *                                                                                    *         
*------------------------------------------------------------------------------------------------------------------------          
*   *---------------------*        99.99%     * 100% LIMITED  *                    *                  *              *             
*                                  ECONOMIC   * PARTNER       *                    *                  *              *             
*                        0.01%     INTEREST   * INTEREST      *                    *                  *              *             
*                       ECONOMIC              *               *                    *                  *              *             
*                       INTEREST              *               *100%                *100%              *100%          *100%         
*                                             *               *                    *                  *              *             
*  *---------------------*     *-------------------* *-----------------* *-----------------* *---------------* *--------------*    
*  *      BCMR, INC.     *     *  BCMR SEATTLE, A  * *      BCMR       * * BCMR PORTLAND,  * *  ALLTX, LLC   * *ALLTX GP, LLC *    
*--*  (GENERAL PARTNER)  *-----*LIMITED PARTNERSHIP* *JACKSONVILLE, LLC* *      LLC        * *               * *              *    
*  *---------------------*     *-------------------* *-----------------* *-----------------* *---------------* *--------------*    
*                      100% GENERAL     *                   *                    *                   *                *            
*                    PARTNER INTEREST   *                   *                    *                   *                *            
*                                       *                   *                    *                   *                *            
*                                       *                   *                    *                   *                *            
*            EXERCISES VOTING RIGHTS OF *CONTROLLING        *CONTROLLING         *CONTROLLING        *CONTINUING      *CONTINUING  
*             BCMR SEATTLE, A LIMITED   *INTEREST (3)       *INTEREST (3)        *INTEREST (3)       *LP INTEREST     *GP INTEREST 
*                 PARTNERSHIP (1)       *                   *                    *                   *                *            
*                                       *                   *                    *                   *                *            
*   *-------------------*     *----------------* *------------------*     *----------------*  *----------------------------------* 
*---* BCMR SPECIAL, INC.*-----*  BC-GFS LLC    * *  BC-BAINBRIDGE   *     * BC-GFS II LLC  *  *  BC BROADSTONE PRESTON, LP       * 
    *                   *     *                * *      LLC         *     *                *  *(OWNER OF OUR PLANO COMMUNITY)    * 
    *-------------------*     *----------------* *------------------*     *----------------*  *----------------------------------* 
                              *      *           *    *                          *        *           *                *           
                              *      *           *    *                          *        *           *                *           
         *--------------------*      * 100%      *    * 100%                     * 100%   *           *                *           
         *                           *           *    *                          *        *---        *ECONOMIC        *ECONOMIC   
         * ECONOMIC INTEREST (2)     *      *----*    *                          *        *  *        *GP INTEREST     *LP INTEREST
         *                           *      *         *                          *        *  *        *                *           
    *---------------* *------------------*  * *---------------------* *--------------------* *  *--------------* *-------------*   
    *  GFS EQUITY   * *    FOUR LLCs     *  * *    THREE LLCs       * *    THREE LLCs      * *  * ALLIANCE G.P.* *BROADSTONE   *   
    *MANAGEMENT LLC * *(EACH AN OWNER OF *  * *(EACH AN OWNER OF ONE* *(EACH AN OWNER OF   * *  * IV, INC      * *PRESTON      *   
    *  (MANAGER)    * *ONE OF THE SEATTLE*  * *OF THE JACKSONVILLE  * *ONE OF THE PORTLAND/* *  *              * *ALLIANCE LLC *   
    *               * *   COMMUNITIES)   *  * *    COMMUNITIES)     * *   SALT LAKE        * *  *--------------* *-------------*   
    *               * *                  *  * *                     * *  COMMUNITIES)      * *                                     
    *---------------* *------------------*  * *---------------------* *--------------------* *                                     
            *                               *  ECONOMIC INTEREST (2)                         *                                     
            *                               *                                                *                                     
            *                       *--------------------------------*                       *                                     
            *ECONOMIC INTEREST (2)  * BAINBRIDGE JACKSONVILLE LLC (4)*                       *                                     
            *                       *           (MANAGER)            *                       *                                     
            *                       *--------------------------------*                       *                                     
            *----------------------------------------------------------------------------------------------------*                 

--------                                                                        

(1) Under the limited liability Company agreement of BC-GFS LLC, BCMR           
   Special, Inc., as the investor manager of BC-GFS LLC, contractually has the
authority to exercise the voting rights of BC-GFS LLC's member (BCMR    
 Seattle, A Limited Partnership) in order to give consent for all material
decisions regarding the Seattle communities. The limited partnership    
agreement of BCMR Seattle, A Limited Partnership provides that BCMR     
 Special, Inc. will act upon Boston Capital REIT's instructions and obtain
  our consent prior to taking or approving any actions regarding the Seattle
  communities and will otherwise at all times act in our best interests as a
 fiduciary. BCMR Special, Inc. will not receive any compensation from this
 offering or our operations as a result of its role as investor manager of
BC-GFS LLC. Instead, the Advisory Fee will be paid to our advisor, an   
affiliate of BCMR Special, Inc.                                         

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(2) Although we own the 100% economic interest in all of our initial 10         
    communities (99.99% of the economic interest in the Seattle communities) and
 96.95% of the economic interest in our Plano community, affiliates of the
third party management agents are entitled to participate in the cash   
 distributions of our communities after Boston Capital REIT has received a
    priority share of the cash flow. This is in addition to the range of 3.5% to
  4.0% of gross rental income each third party management agent receives for
    managing the communities. This type of sharing arrangement is typical in the
  real estate industry. We entered into this agreement because we thought it
   was appropriate to provide an additional incentive to encourage performance
    by the management agents in order to maximize the income of the communities.
    We can remove the third party management agents and their affiliates without
 cause at any time, although they will continue to participate in the cash
 distributions of our communities, as noted above, following such removal.
Bainbridge Management Jacksonville LLC, an affiliate of Bainbridge      
   Jacksonville LLC, is the management agent for the Jacksonville communities,
 Pinnacle Realty Management Company, an affiliate of GFS Equity Management
 LLC, is the management agent for our Portland, Salt Lake City and Seattle
communities, and Alliance Residential, LLC, an affiliate of             
Alliance G.P. IV, Inc. and Broadstone Preston Alliance LLC, is the      
management agent for our Plano community.                               

Before any affiliates of the third party management agents receive any  
portion of the cash flow, we will receive:                              

      (i) $50 annually per apartment unit (a total of 1040 units times $50
           equals $52,000 annually for the Jacksonville communities; a total
        of 802 units times $50 equals $40,100 annually for the Seattle
         communities; and a total of 1027 units times $50 equals $51,350
        annually for the Portland and Salt Lake City communities); and

      (ii) a 12% preferred return on our unreturned capital contributions to
           the Jacksonville and Seattle communities ($2,929,157 based on our
      initial $24,409,639 capital contribution to the Jacksonville
            communities and $1,035,233 based on our initial $8,626,939 capital
       contribution to the Seattle communities); and a 11% preferred
            return on our unreturned capital contributions to the Portland and
     Salt Lake City communities ($2,401,270 based on our initial
             $21,829,724 capital contribution to the Portland and Salt Lake City
communities).                                         

 To the extent we receive this priority share of the cash flow, it will be
used to pay our ordinary expenses, including operational-stage fees and 
    reimbursement to our advisor and affiliates. After payment of such expenses,
   the priority cash flow would be available for distribution to stockholders.
 There is no guarantee that there will be sufficient priority cash flow to
make any distributions to stockholders. We will then share 50/50 with   
  Bainbridge Jacksonville LLC in all remaining income from operations of our
   Jacksonville communities. Proceeds from the sale of any of our Jacksonville
    communities will first be distributed to pay us a 1% sales analysis fee, and
then to pay us any unpaid asset management fees and preferred return.   

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  Remaining sale proceeds will be distributed to us until we have received a
return of our capital contributions (taking into account prior          
distributions) plus a 16% per annum rate of return on our capital       
contribution (initial capital of $8,626,939 with respect to the Seattle 
  communities and initial class A contribution of $9,364,951 with respect to
 the Portland communities and $24,409,639 with respect to the Jacksonville
   communities). With respect to our Portland and Seattle communities, we will
   then receive 75% and the respective affiliate of the third party management
   agents will receive 25% of any remaining sale proceeds. With respect to our
    Jacksonville communities, we will then receive 93.75% (of which an affiliate
of Bainbridge Jacksonville LLC receives 20% as an advisory fee) and     
Bainbridge Jacksonville LLC will receive 6.25% of any remaining sale    
    proceeds. There is no guarantee that any preferred return will be sufficient
for us to make any distribution to stockholders. We believe that this   
arrangement is an appropriate incentive to encourage performance by     
Bainbridge Jacksonville LLC. We can remove Bainbridge Jacksonville LLC  
without cause at any time, however they will not lose their economic    
interest.                                                               

Alliance Residential, LLC is entitled to participate in the cash        
    distributions of BC Broadstone Preston, LP after we have received a priority
  share of the operating cash flow from our Plano community. Before Alliance
Residential, LLC receives any portion of the cash flow, we will first   
receive an annual asset management fee equal to $11,450 annually. After 
    payment of this fee, we and Alliance Residential, LLC will receive ratably a
  10% preferred return on unreturned capital (which initially was $5,556,348
and $175,000, respectively). We will then share 80/20 with Alliance     
Residential, LLC in all remaining cash flow from operations of our Plano
community. To the extent we receive distributions from BC Broadstone    
    Preston, LP, such distributions will be used, first to pay interest due on a
 monthly basis on the Wachovia loan and then to pay our ordinary expenses,
including operational-stage fees and reimbursement to our advisor and   
affiliates. After these payments, the amounts received from the         
  distributions described above would be available to satisfy obligations of
the REIT with any excess available for distribution to our stockholders.
    There is no guarantee that there will be sufficient cash flow from our Plano
   community to make the distributions described above. Proceeds from the sale
of our Plano community will first be distributed to us in payment of the
accrued, but unpaid, management fee referred to above. Remaining sale   
proceeds will be distributed to us and Alliance Residential, LLC ratably
   until we have each received our accrued and unpaid 10% preferred return and
   a return of our capital contributions. Remaining sale proceeds will then be
distributed:                                                            

       - 80% to us and 20% to Alliance Residential, LLC until we have received
       a 13% per annum rate of return on our capital contributions (taking
into account prior distributions);                          

    - then, 75% to us and 25% to Alliance Residential, LLC until we have
        received a 16% per annum rate of return on our capital contributions
(taking into account prior distributions);                  

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    - then, 70% to us and 30% to Alliance Residential, LLC until we have
       received a 20% per annum rate of return on our capital contribution
(taking into account prior distributions); and              

 - then, any residual sale proceeds, 60% to us and 40% to Alliance
Residential, LLC.                                           

(3) BCMR Seattle, A Limited Partnership, BCMR Jacksonville, LLC, and BCMR       
Portland, LLC (collectively, the "BCMR entities") have a controlling    
    interest in BC-GFS, LLC, BC-Bainbridge LLC, and BC-GFS II LLC, respectively,
   because they have consent rights over material decisions and can remove and
   replace the member manager GFS Equity Management LLC, in the case of BC-GFS
  LLC and BC-GFS II LLC, and the member manager Bainbridge Jacksonville LLC,
    in the case of BC-Bainbridge LLC, at any time. GFS Equity Management LLC and
    Bainbridge Jacksonville LLC are entitled to a share in cash flow and in sale
proceeds.                                                               

(4) The members and manager of Bainbridge Jacksonville LLC are not affiliated   
with us or our advisor. Bainbridge Jacksonville LLC is the operator of  
BC-Bainbridge LLC, of which our affiliate BCMR Jacksonville, LLC is the 
investor.                                                               

Compensation and Fees 

Our advisor and its affiliates will receive compensation and fees for services  
relating to this offering and the management of our affairs. The most           
significant items of compensation are included in the following table:          

                                                                [Download Table]

    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                    ORGANIZATIONAL AND OFFERING STAGE                     
--------------------------------------------------------------------------
SELLING           7.0% of gross             $175,000        $70,000,000   
COMMISSIONS IN    offering proceeds                                       
CONNECTION WITH   before reallowance                                      
THE OFFERING--    of commissions                                          
THE DEALER-       earned by                                               
MANAGER           participating                                           
                  broker-dealers. The                                     
                  dealer-manager                                          
                  intends to reallow                                      
                  100% of commissions                                     
                  earned for those                                        
                  transactions that                                       
                  involve                                                 
                  participating                                           
                  broker-dealers.                                         

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                                                                [Download Table]

    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                    ORGANIZATIONAL AND OFFERING STAGE                     
--------------------------------------------------------------------------
DEALER-MANAGER    2.0% of gross             $50,000         $20,000,000   
FEE--THE DEALER-  offering proceeds                                       
MANAGER           before reallowance                                      
                  to participating                                        
                  broker-dealers. The                                     
                  dealer-manager in                                       
                  its sole discretion                                     
                  may reallow up to                                       
                  1.5% of its                                             
                  dealer-manager fee                                      
                  to be paid to such                                      
                  participating                                           
                  broker-dealers as                                       
                  additional                                              
                  compensation.                                           

REIMBURSEMENT OF  Up to 2.25% of gross      $56,250         $22,500,000   
ORGANIZATION AND  offering proceeds.                                      
OFFERING          If organization and                                     
EXPENSES--OUR     offering expenses                                       
ADVISOR OR ITS    (excluding selling                                      
AFFILIATES        commissions and the                                     
                  dealer-manager fee)                                     
                  exceed 2.25% of the                                     
                  gross proceeds                                          
                  raised in this                                          
                  offering, the excess                                    
                  will be paid by our                                     
                  advisor without                                         
                  recourse to us.                                         
--------------------------------------------------------------------------
                    ACQUISITION AND DEVELOPMENT STAGE                     
--------------------------------------------------------------------------
ACQUISITION       Up to 2.70% of gross      $67,500         $27,000,000   
FEES--OUR         offering proceeds                                       
ADVISOR OR ITS    for the review and                                      
AFFILIATES(2)     evaluation of real                                      
                  property                                                
                  acquisitions.                                           
                  $1,444,844 of                                           
                  acquisition fees                                        
                  have been prepaid to                                    
                  an affiliate, Boston                                    
                  Capital Holdings                                        
                  Limited Partnership.                                    

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                                                                [Download Table]

    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                    ACQUISITION AND DEVELOPMENT STAGE                     
--------------------------------------------------------------------------
                  The purchase price                                      
                  for each community                                      
                  included the                                            
                  following prepaid                                       
                  acquisition fees:                                       
                  $470,908 for the                                        
                  Jacksonville                                            
                  communities (1.60%                                      
                  of the offering                                         
                  proceeds related to                                     
                  the Jacksonville                                        
                  communities);                                           
                  $552,794 for the                                        
                  Seattle communities                                     
                  (2.79% of the                                           
                  offering proceeds                                       
                  related to the                                          
                  Seattle                                                 
                  communities); and                                       
                  $421,142 for the                                        
                  Portland/Salt Lake                                      
                  communities (1.63%                                      
                  of the offering                                         
                  proceeds related to                                     
                  the Portland/Salt                                       
                  Lake communities).                                      
                  These amounts will                                      
                  be deducted from the                                    
                  2.70% acquisition                                       
                  fee we have agreed                                      
                  to pay our advisor                                      
                  with respect to each                                    
                  of the communities.                                     
                  An acquisition fee                                      
                  of approximately                                        
                  $173,000 will be                                        
                  paid once the lien                                      
                  under the Wachovia                                      
                  loan is released.                                       

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                                                                [Download Table]

    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                    ACQUISITION AND DEVELOPMENT STAGE                     
--------------------------------------------------------------------------
                  If we raise                                             
                  sufficient funds to                                     
                  repay the borrowings                                    
                  related to a                                            
                  community, the                                          
                  additional                                              
                  acquisition fee due                                     
                  will be paid at the                                     
                  time of the                                             
                  repayment of such                                       
                  borrowings less any                                     
                  amounts previously                                      
                  prepaid; thus if we                                     
                  raise at least                                          
                  approximately                                           
                  $29.5 million (not                                      
                  including any                                           
                  accrued interest on                                     
                  our affiliate line                                      
                  of credit or amounts                                    
                  distributed to                                          
                  stockholders from                                       
                  offering proceeds)                                      
                  and repay the amount                                    
                  of borrowings                                           
                  related to our                                          
                  Jacksonville                                            
                  communities, we                                         
                  would pay an                                            
                  additional $325,592                                     
                  in acquisition fees,                                    
                  which represents the                                    
                  $796,500 fee due                                        
                  less the prepaid fee                                    
                  of $470,908.                                            

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                                                                [Download Table]

    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                    ACQUISITION AND DEVELOPMENT STAGE                     
--------------------------------------------------------------------------
REIMBURSEMENT OF  Up to 0.5% of gross       $12,000          $5,000,000   
ACQUISITION       offering proceeds.                                      
EXPENSES--OUR     The purchase price                                      
ADVISOR OR ITS    for each community                                      
AFFILIATES(2)     included the                                            
                  following prepaid                                       
                  acquisition                                             
                  expenses: $73,519                                       
                  for the Jacksonville                                    
                  communities (0.25%                                      
                  of the offering                                         
                  proceeds related to                                     
                  Jacksonville);                                          
                  $49,739 for the                                         
                  Seattle communities                                     
                  (0.25% of the                                           
                  offering proceeds                                       
                  related to Seattle);                                    
                  and $65,751 for the                                     
                  Portland/Salt Lake                                      
                  communities (0.25%                                      
                  of the offering                                         
                  proceeds related to                                     
                  the Portland/Salt                                       
                  Lake communities).                                      

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                                                                [Download Table]

    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                    ACQUISITION AND DEVELOPMENT STAGE                     
--------------------------------------------------------------------------
                  If we raise                                             
                  sufficient funds to                                     
                  repay the borrowings                                    
                  related to a                                            
                  community, the                                          
                  additional                                              
                  acquisition expenses                                    
                  due will be paid at                                     
                  the time of the                                         
                  repayment of such                                       
                  borrowings less any                                     
                  amounts previously                                      
                  prepaid; thus if we                                     
                  raise approximately                                     
                  $29.5 million (not                                      
                  including any                                           
                  accrued interest on                                     
                  our affiliate line                                      
                  of credit or amounts                                    
                  distributed to                                          
                  stockholders from                                       
                  offering proceeds)                                      
                  and repay the amount                                    
                  of borrowings                                           
                  related to our                                          
                  Jacksonville                                            
                  communities, we                                         
                  would pay an                                            
                  additional $73,981                                      
                  in acquisition                                          
                  expenses, which                                         
                  represents the                                          
                  $147,500 acquisition                                    
                  expenses due less                                       
                  the prepaid                                             
                  acquisition expenses                                    
                  of $73,519.                                             
--------------------------------------------------------------------------

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                                                                [Download Table]

    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                            OPERATIONAL STAGE                             
--------------------------------------------------------------------------
ASSET MANAGEMENT  For the management    Based on the      Not determinable
FEE--OUR ADVISOR  of our affairs, we    communities       at this time as 
OR ITS            will pay our advisor  identified in     this amount will
AFFILIATES        a monthly asset       this prospectus,  increase if we  
                  management fee equal  the estimated     acquire         
                  to 1/12th of 0.75%    amount would be   additional      
                  of the Company's      $121,757 per      communities.    
                  real estate asset     month.                            
                  value as of the end                                     
                  of the preceding                                        
                  month. Real estate                                      
                  asset value equals                                      
                  the amount actually                                     
                  paid or allocated to                                    
                  the purchase,                                           
                  development,                                            
                  construction or                                         
                  improvement of                                          
                  communities we                                          
                  wholly own                                              
                  (including the                                          
                  principal amount of                                     
                  any mortgage                                            
                  indebtedness on the                                     
                  communities assumed                                     
                  upon the purchase of                                    
                  the communities),                                       
                  and, in the case of                                     
                  communities in which                                    
                  we are a co-                                            
                  venturer or partner,                                    
                  our portion of such                                     
                  amount with respect                                     
                  to such communities,                                    
                  exclusive of                                            
                  acquisition fees and                                    
                  acquisition                                             
                  expenses. The asset                                     
                  management fee,                                         
                  which will not                                          
                  exceed fees which                                       
                  are competitive for                                     
                  similar services in                                     
                  the same geographic                                     
                  area, may or may not                                    
                  be taken, in whole                                      
                  or in part as to any                                    
                  year, in the sole                                       
                  discretion of our                                       
                  advisor. All or any                                     
                  portion of the asset                                    
                  management fee not                                      
                  taken as to any                                         
                  fiscal year will be                                     
                  deferred without                                        
                  interest and may be                                     
                  taken in such other                                     
                  fiscal year as our                                      
                  advisor determines.                                     

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    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                            OPERATIONAL STAGE                             
--------------------------------------------------------------------------
LOAN INTEREST--   Base interest at      Based on the                      
BCP FUNDING       9.5% per annum plus   $56,596,665                       
                  bonus interest at     balance as of                     
                  5.3% to the extent    December 31,                      
                  of cash available     2005, the annual                  
                  for debt service      base interest                     
                  after payment of      paid is                           
                  base interest,        $5,376,683. Any                   
                  payable quarterly,    additional bonus                  
                  and, in the case of   interest will be                  
                  base interest, to     equal to the                      
                  the extent not paid,  distributable                     
                  added to principal.   cash flow of the                  
                  In return for our     communities in                    
                  affiliate line of     excess of base                    
                  credit being          interest. No                      
                  nonrecourse to the    such additional                   
                  Company, we agreed    bonus interest                    
                  to pay additional     was paid in                       
                  interest solely from  2003, 2004 and                    
                  cash available for    2005 because                      
                  debt service from     there has not                     
                  our initial ten       been any                          
                  communities prior to  distributable                     
                  the repayment of the  cash flow.                        
                  line of credit                                          
                  attributable to each                                    
                  community. Until the                                    
                  line of credit                                          
                  attributable to each                                    
                  community is repaid                                     
                  by the due date of                                      
                  January 1, 2007,                                        
                  effectively all cash                                    
                  flow generated by                                       
                  such community will                                     
                  be paid to BCP                                          
                  Funding, LLC.                                           
                  Additional interest                                     
                  is payable quarterly                                    
                  only to the extent                                      
                  of income from                                          
                  communities still                                       
                  subject to BCP                                          
                  Funding's                                               
                  encumbrances. Such                                      
                  additional interest                                     
                  shall not be paid                                       
                  from proceeds of                                        
                  this offering or                                        
                  from cash flow of                                       
                  communities released                                    
                  from the lien.                                          

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    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                            OPERATIONAL STAGE                             
--------------------------------------------------------------------------
SUBORDINATED      If our advisor or an  Not determinable  Not determinable
DISPOSITION       affiliate provides a  at this time.     at this time.   
FEE--OUR ADVISOR  substantial amount                                      
OR ITS            of the services (as                                     
AFFILIATES        determined by a                                         
                  majority of our                                         
                  Company's                                               
                  independent                                             
                  directors) in                                           
                  connection with the                                     
                  sale of one or more                                     
                  properties, a fee                                       
                  equal to the lesser                                     
                  of (A) 50% of the                                       
                  reasonable,                                             
                  customary and                                           
                  competitive real                                        
                  estate brokerage                                        
                  commissions                                             
                  customarily paid for                                    
                  the sale of a                                           
                  comparable property                                     
                  in light of the                                         
                  size, type and                                          
                  location of the                                         
                  property, or                                            
                  (B) 3.0% of the                                         
                  sales price for each                                    
                  community sold. The                                     
                  subordinated                                            
                  disposition fee will                                    
                  be paid only if                                         
                  stockholders have                                       
                  received (1) total                                      
                  dividends in an                                         
                  amount equal to 100%                                    
                  of their aggregate                                      
                  invested capital and                                    
                  (2) a 6.0% annual                                       
                  cumulative non-                                         
                  compounded return on                                    
                  their net invested                                      
                  capital (the                                            
                  "Stockholder's 6.0%                                     
                  Return").                                               

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    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                            OPERATIONAL STAGE                             
--------------------------------------------------------------------------
SUBORDINATED      15.0% of remaining    Not determinable  Not determinable
SHARE OF NET      amounts of net sale   at this time.     at this time.   
SALE              proceeds after                                          
PROCEEDS--OUR     stockholders have                                       
ADVISOR(3)        received                                                
                  distributions equal                                     
                  to the sum of                                           
                  (1) the                                                 
                  Stockholder's 6.0%                                      
                  Return and (2) 100%                                     
                  of net invested                                         
                  capital. Following                                      
                  listing on a                                            
                  national securities                                     
                  exchange or a                                           
                  national securities                                     
                  market, no                                              
                  subordinate share of                                    
                  net sale proceeds                                       
                  will be paid to our                                     
                  advisor.                                                

SUBORDINATED      Upon listing on a     Not determinable  Not determinable
INCENTIVE         national securities   at this time      at this time    
LISTING FEE--OUR  exchange or a                                           
ADVISOR(3)(4)(5)  national securities                                     
                  market, a fee equal                                     
                  to 10.0% of the                                         
                  amount by which the                                     
                  adjusted market                                         
                  value of our common                                     
                  stock plus the total                                    
                  of all distributions                                    
                  paid from our                                           
                  inception until the                                     
                  date of listing                                         
                  exceeds the sum of                                      
                  (1) 100% of invested                                    
                  capital and (2) the                                     
                  total distributions                                     
                  required to be paid                                     
                  to the stockholders                                     
                  to pay the                                              
                  Stockholder's 6.0%                                      
                  Return from                                             
                  inception through                                       
                  the date of listing.                                    

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    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                            OPERATIONAL STAGE                             
--------------------------------------------------------------------------
PROPERTY          3.5% to 4.0% of       Actual amounts    Actual amounts  
MANAGEMENT        gross income of each  are dependent     are dependent   
FEE--AN           community.            upon results of   upon results of 
AFFILIATE OF GFS                        operations and    operations and  
EQUITY                                  therefore cannot  therefore cannot
MANAGEMENT LLC,                         be determined at  be determined at
AN AFFILIATE OF                         the present       the present     
BAINBRIDGE                              time.             time.           
JACKSONVILLE LLC                                                          
AND AN AFFILIATE                                                          
OF ALLIANCE                                                               
G.P. IV, INC.                                                             
AND BROADSTONE                                                            
PRESTON ALLIANCE                                                          
LLC                                                                       

INCENTIVE         50% of all remaining  Actual amounts    Actual amounts  
MANAGEMENT        income from           are dependent     are dependent   
FEE--AN           operations of the     upon results of   upon results of 
AFFILIATE OF GFS  communities in        operations and    operations and  
EQUITY            excess of minimum     therefore cannot  therefore cannot
MANAGEMENT LLC    cash distribution     be determined at  be determined at
AND AN AFFILIATE  thresholds set for    the present       the present     
OF BAINBRIDGE     each community,       time.             time.           
JACKSONVILLE LLC  including $50                                           
                  annually per                                            
                  apartment unit and                                      
                  either an 11% or 12%                                    
                  preferred return.                                       

INCENTIVE         20% of all remaining  Actual amounts    Actual amounts  
MANAGEMENT        income from           are dependent     are dependent   
FEE--AN           operations of the     upon results of   upon results of 
AFFILIATE OF      community in excess   operations and    operations and  
ALLIANCE          of the minimum cash   therefore cannot  therefore cannot
G.P. IV, INC.     distribution          be determined at  be determined at
AND BROADSTONE    threshold and a 10%   the present       the present     
PRESTON           preferred return.     time.             time.           
ALLIANCE, INC.                                                            

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    Type of                                Estimated         Estimated    
  Compensation         Method of            Minimum           Maximum     
 and Recipient        Compensation         Amount(1)         Amount(1)    
----------------  --------------------  ----------------  ----------------
                                                                          
                            OPERATIONAL STAGE                             
--------------------------------------------------------------------------
SALE PROCEEDS--   For the Jacksonville  Actual amounts    Actual amounts  
BAINBRIDGE        communities, an       are dependent     are dependent   
JACKSONVILLE      affiliate of          upon results of   upon results of 
LLC, GFS EQUITY   Bainbridge            operations and    operations and  
MANAGEMENT LLC    Jacksonville LLC      therefore cannot  therefore cannot
AND AN AFFILIATE  will receive an       be determined at  be determined at
OF ALLIANCE       advisory services     the present       the present     
G.P. IV, INC.     fee equal to 20% of   time.             time.           
AND BROADSTONE    our 93.75% of the                                       
PRESTON ALLIANCE  remaining proceeds,                                     
LLC               and Bainbridge                                          
                  Jacksonville LLC                                        
                  will receive 6.25%                                      
                  of any remaining                                        
                  sale proceeds. For                                      
                  the Portland and                                        
                  Salt Lake City                                          
                  communities and                                         
                  Seattle communities,                                    
                  GFS Equity                                              
                  Management LLC will                                     
                  receive 25% of any                                      
                  remaining sale                                          
                  proceeds. For the                                       
                  Plano community,                                        
                  remaining sale                                          
                  proceeds will be                                        
                  distributed to us                                       
                  and Alliance                                            
                  Residential, LLC                                        
                  ratably until we                                        
                  have each received a                                    
                  10% preferred return                                    
                  and then 80/20 until                                    
                  we have received a                                      
                  13% return, 75/25                                       
                  until we have                                           
                  received a 16%                                          
                  return, 70/30 until                                     
                  we have received a                                      
                  20% return and then                                     
                  any residual sale                                       
                  proceeds, 60/40.                                        

---------                                                                       

Notwithstanding the method by which we calculate the payment of operating       
expenses, as described in the table above, the total of all such operating      
expenses will not exceed, in the aggregate, the greater of 2% of the book value 
of the assets or 25% of cash net income as required by the Statement of Policy  
Regarding Real Estate Investment Trusts of the North American Securities        
Administration Association, Inc. (the "NASAA Guidelines").                      

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(1) The estimated minimum dollar amounts are based on the sale of a minimum of  
   250,000 shares to the public at $10 per share. The estimated maximum dollar
amounts are based on the sale of a maximum of 100,000,000 shares to the 
public at $10 per share. The sale of up to 5,000,000 shares at $9.30 per
share pursuant to our dividend reinvestment plan is excluded from those 
amounts.                                                                

(2) Notwithstanding the method by which we calculate the payment of acquisition 
fees and expenses, as described in the table, the total of all such     
    acquisition fees and acquisition expenses will not exceed, in the aggregate,
    an amount equal to 6.0% of the contract price of all of the properties which
we purchase, as required by the NASAA Guidelines.                       

(3) In the event that we become listed on a national securities exchange or a   
  national market system and our advisor receives the subordinated incentive
listing fee prior to its receipt of the subordinated share of net sale  
   proceeds, our advisor will not be entitled to any such participation in net
sale proceeds.                                                          

(4) If at any time the shares become listed on a national securities exchange or
  a national market system, or, notwithstanding the absence of such listing,
 our stockholders elect to continue our Company's existence after June 22,
2015, we will negotiate in good faith with our advisor a fee structure  
appropriate for an entity with a perpetual life. A majority of the      
    independent directors must approve any new fee structure negotiated with our
   advisor. In negotiating a new fee structure, the independent directors will
  consider all the factors they deem relevant, including but not limited to:

       - the size of the advisory fee in relation to the size, composition and
profitability of our portfolio;                             

      - the success of our advisor in generating opportunities that meet our
investment objectives;                                      

       - the rates charged to other REITs and to investors other than REITs by
advisors performing similar services;                       

- additional revenues realized by our advisor;                  

        - the quality and extent of service and advice furnished by our advisor;

- the performance of our investment portfolio, including income,
 conservation or appreciation of capital, frequency of problem
       investments and competence in dealing with distress situations; and

 - the quality of our portfolio in relationship to the investments
generated by our advisor for the account of other clients.  

The board, including a majority of the independent directors, may not   
   approve a new fee structure that is, in its judgment, more favorable to our
advisor than the current fee structure.                                 

(5) The market value of our outstanding stock will be calculated based on the   
 average market value of the shares issued and outstanding at listing over
   the 30 trading days beginning 180 days after the shares are first listed on
a stock                                                                 

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 exchange. We have the option to pay the listing fee in the form of stock,
cash, a promissory note or any combination thereof. In the event the    
    subordinated incentive listing fee is paid to our advisor as a result of the
listing of our shares, we will not be required to pay our advisor any   
further subordinated participation in net sale proceeds.                

   In addition, our advisor and its affiliates will be reimbursed only for the
   actual costs of goods and services used for or by us. We will not reimburse
 our advisor or its affiliates for services for which they are entitled to
compensation by way of a separate fee.                                  

Since our advisor and its affiliates are entitled to differing levels of        
compensation for undertaking different transactions on behalf of our Company,   
such as the advisory fees for managing our affairs and the subordinated         
participation in net sale proceeds, our advisor has the ability to affect the   
nature of the compensation it receives by undertaking different transactions.   
However, our advisor is obligated to exercise good faith and integrity in all   
its dealings with respect to our affairs pursuant to the advisory agreement.    
(See "Management--Our Advisor--The Advisory Agreement.") Because these fees or  
expenses are payable only with respect to certain transactions or services, they
may not be recovered by our advisor or its affiliates by reclassifying them     
under a different category.                                                     

Compensation of Directors and Executive Officers

Each independent director will receive an annual retainer of $50,000, as well as
$1,000 for each meeting attended in person ($375 for each telephonic meeting in 
which the director participates), including committee meetings, except for a    
committee meeting attended in person held in connection with a board meeting    
attended in person, for which the director will receive $500. Our executive     
officers who are also our directors do not receive director fees. The chairman  
of our audit committee receives an additional annual retainer of $10,000. In    
addition, the independent directors receive automatically, upon initial election
to our board, an option to purchase 5,000 shares of our common stock, and       
annually each year after their initial election receive an option to purchase   
5,000 shares of our common stock. The option exercise price is the fair market  
value of our common stock on the date prior to the date of initial election or  
prior to the date of our annual meeting, as applicable. We will not pay any     
compensation to our officers and directors who also serve as officers of our    
advisor. In connection with their election to our board, Messrs. Cottone, Phelan
and Iacuzio were each granted options to purchase 5,000 shares at $10.00 per    
share. The options have not been exercised as of the date hereof.               

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We did not pay compensation to the executive officers of our affiliated entities
during 2005. During 2005 we paid fees to each of the directors for their        
participation in various meetings in 2005 as follows:                           

                                                                [Download Table]

                                      Mr. Cottone   Mr. Iacuzio   Mr. Phelan
                                      -----------   -----------   ----------
                                                                            
Board..............................      $3,375        $2,375       $2,375  
Audit Committee....................       1,750         2,250        2,250  
Compensation Committee.............         500           500          500  
Nominating & Corporate                                                      
  Governance.......................         500            --          500  

The Offering

We are offering up to 100,000,000 shares of our common stock at $10 per share to
investors who meet our suitability standards. The price of the shares was       
established at $10 per share by our board of directors after consultation with  
the dealer-manager based on prevailing market conditions and other factors, such
as the prospects for our Company and the industry in which we compete. The price
of the shares does not necessarily reflect the value of the communities we have 
purchased or may purchase in the future. The shares are being offered on a best 
efforts basis, which means that no specified amount of capital will be raised.  
No shares will be sold, however, unless at least 250,000 shares are sold. We are
also offering up to 5,000,000 shares to be issued pursuant to our dividend      
reinvestment plan at $9.30 per share. We will begin selling shares in this      
offering on the effective date of this prospectus, and this offering will       
terminate no later than July 1, 2007. We may terminate this offering at any time
prior to that date. We will place initial monies raised in an escrow account    
with Boston Private Bank & Trust Company, Boston, Massachusetts, until the      
$2,500,000 minimum is achieved, at which time such funds will be released to us 
from escrow. During the time funds are held in escrow, interest will be earned  
at a variable rate, currently 3.35% per annum, which can adjust similar to a    
bank passbook savings rate. The interest will be paid to the investor even if   
the minimum is not reached. An initial closing will be held within 5 days after 
the minimum is achieved. After the initial closing, we will admit stockholders  
to our Company, and release investor funds from escrow, as soon as practicable. 
Subscriptions may not be withdrawn by purchasers. If the minimum is not achieved
by the termination date, the escrowed funds with accrued interest will be       
returned to investors within 5 days. The dealer-manager will not purchase any of
our shares.                                                                     

Estimated Use of Proceeds 

We anticipate that at least 84.55% of the proceeds of this offering will be     
invested in real estate communities. We will use the remainder to pay selling   
commissions and dealer-manager fees, fees and expenses relating to              

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the selection and acquisition of properties and the costs of the offering and   
will retain 1% as working capital reserves. Additionally, under certain         
circumstances a portion of the proceeds identified as the real estate investment
in communities may be set aside at the respective communities for operating     
reserves. As long as there are amounts outstanding under our affiliate line of  
credit used to acquire our interests in our initial ten communities, at least   
84.55% of the proceeds will be applied to the repayment of the line, and the    
lender will release its lien on our interest in the apartment community acquired
with the proceeds of the repaid loan. If we raise at least approximately        
$29.5 million (not including any accrued interest on our affiliate line of      
credit or amounts distributed to stockholders from offering proceeds),          
$24,954,067 of such amount will be used to repay our affiliate line of credit   
related to our Jacksonville communities. If we raise the $74,495,922 (not       
including any accrued interest on our affiliate line of credit or amounts       
distributed to stockholders from offering proceeds) necessary to repay our      
affiliate line of credit attributed to our initial ten communities, a total of  
$56,596,665 of such amount will be used to repay our affiliate line of credit   
and approximately $7,987,418 (which amount represents the balance outstanding as
of December 31, 2005 of the original note in the aggregate principal amount of  
$8,120,000) will be used to repay the second mortgage loan on the Seattle       
communities. To the extent that we raise $80,890,183 (not including any accrued 
interest on our affiliate line of credit or the Wachovia loan or amounts        
distributed to stockholders from offering proceeds) by January 1, 2007, we may  
repay the Wachovia loan of $5,556,348 (not including any accrued interest) with 
proceeds from this offering. However, we will have no cash flow available for   
distributions to our stockholders until we raise at least the amounts due under 
our affiliate line of credit with respect to our Jacksonville communities.      
Therefore, we anticipate paying all or a significant portion of distributions to
stockholders from the proceeds of this offering or from borrowings until such   
time as we have sufficient cash flow from operations to fund the payment of such
distributions. Until such time as cash flows from operations and other sources  
of cash are sufficient to fund such distribution payments, if ever, we will have
invested less than 84.55% of the proceeds of this offering in real estate       
communities (or the repayment of debt).                                         

Listing 

We expect to seek listing of our shares on a national securities exchange such  
as the New York Stock Exchange or the American Stock Exchange or on the NASDAQ  
National Market when, in the judgment of our management and our board of        
directors, our size and maturity make listing appropriate and desirable. We     
expect that our market capitalization would have to equal or exceed that of     
comparable listed REITs in order to justify                                     

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listing. In the event we do not obtain listing of our shares on a national      
securities exchange or on the NASDAQ National Market by June 22, 2015, our      
articles of incorporation require us to begin the sale of our properties and    
liquidation of our assets if stockholders owning a majority of our shares vote  
to authorize us to do so.                                                       

Dividend Reinvestment Plan

We have adopted a reinvestment plan which will allow participating stockholders 
to have their dividends reinvested in additional shares that may be available.  
We have registered 5,000,000 shares of our common stock for purchase under the  
dividend reinvestment plan at $9.30 per share. We reserve the right in the      
future to reallocate additional shares to the dividend reinvestment plan out of 
the shares we are offering to the public, if necessary. If you participate, you 
will be taxed on your share of our taxable income even though you will not      
receive the cash for your dividends. As a result, you may have a tax liability  
without receiving cash dividends to pay such liability. We may terminate the    
dividend reinvestment plan at our discretion, at any time, upon ten days notice 
to you.                                                                         

Share Redemption Program

We may use proceeds received from the sale of shares pursuant to our dividend   
reinvestment plan to redeem your shares. After you have held your shares for a  
minimum of one year, our share redemption program provides an opportunity for   
you to redeem your shares, subject to certain restrictions and limitations. If  
we are engaged in an offering, the redemption price will be the lesser of       
(i) the then-current offering price less a discount approximating the per share 
commissions and fees paid to brokers on the original sale of the shares ($9.15  
per share in the case of shares repurchased during a $10 per share offering) or 
(ii) the price you actually paid for your shares. Our board of directors        
reserves the right to amend or terminate the share redemption program at any    
time. Our board of directors has delegated to our officers the right to         
(i) waive the one-year holding period in the event of the death or bankruptcy of
a stockholder or other exigent circumstances or (ii) reject any request for     
redemption at any time and for any reason. You will have no right to request    
redemption of your shares should our shares become listed on a national         
securities exchange or a national securities market.                            

Stock Certificates

Your investment will be recorded on our books only. We will not issue stock     
certificates. If you wish to transfer your shares, you will be required to send 
an executed transfer form to us. We will provide the required documentation to  
you upon request.                                                               

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RISK FACTORS

An investment in our common stock involves significant risks. You should        
consider the following risks before making your investment decision.            

Risks Related to Our Properties and Our Business

Borrowing creates risks that the offering proceeds may be insufficient to pay   
the non-recourse acquisition debt on the properties or our cash flow may be     
insufficient to meet our debt obligations.  We may borrow money to acquire      
interests in communities, to preserve our status as a REIT, for payment of      
distributions to stockholders and for other corporate purposes. Our board of    
directors anticipates that we will obtain one or more lines of credit to provide
financing for the acquisition of interests in communities to the extent we have 
not yet raised sufficient offering proceeds. We have entered into an initial    
$60,000,000 loan agreement with BCP Funding, LLC, our affiliate and an affiliate
of our advisor, which we used to acquire interests in our initial ten           
communities. We also entered into a $5,556,348 loan with Wachovia Bank, National
Association, which we used to acquire our interests in our Plano community. We  
currently expect to repay all amounts borrowed under our affiliate line of      
credit from the proceeds of this offering, and may repay all amounts borrowed   
under the Wachovia loan. Our affiliate line of credit is non-recourse to our    
Company but is secured by the interests in our initial ten communities. If we do
not receive enough offering proceeds to repay the amounts due under this or any 
other line of credit, we will have to seek additional equity or debt financing  
or lose our interests in communities that secure any unpaid amounts due. In     
addition, our communities are encumbered by mortgage debt, and we expect any    
additional properties we acquire interests in to be similarly encumbered.       
Borrowing may be risky if the cash flow from our real estate investments is     
insufficient to meet our debt obligations. If we cannot meet our debt           
obligations on our secured loans, the lender could take the property, and we    
would lose both the asset and the income we were deriving from it. Further, if  
our leverage does not increase our profitability, we will have less cash        
available for distributions. If we cross-collateralize our properties in order  
to provide additional collateral to a lender, we run the risk of losing a       
good-performing property in the event that it is cross-collateralized with a    
poor-performing property that causes us to default on our loan terms.           

Adverse economic conditions and competition may impede our ability to renew     
leases or re-lease units as leases expire and require us to undertake unbudgeted
capital improvements, which could harm our business and operating results.      

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ADVERSE ECONOMIC CONDITIONS--If our communities do not generate revenues        
sufficient to meet operating expenses, including debt service and capital       
expenditures, our income and results of operations will be significantly harmed.
An apartment community's revenues and value may be adversely affected by the    
general economic climate; the local economic climate; local real estate         
considerations (such as oversupply of or reduced demand for apartments); the    
perception by prospective residents of the safety, convenience and              
attractiveness of the communities or neighborhoods in which our properties are  
located and the quality of local schools and other amenities; and increased     
operating costs (including real estate taxes and utilities). Certain significant
fixed expenses are generally not reduced when circumstances cause a reduction in
income from the investment.                                                     

DEPENDENCY ON RENTAL INCOME--We will be dependent on rental income to pay       
operating expenses and to generate cash to enable us to make distributions to   
our stockholders. If we are unable to attract and retain residents or if our    
residents are unable, due to an adverse change in the economic condition of a   
particular region or otherwise, to pay their rental obligations, our ability to 
make expected distributions will be adversely affected.                         

COMPETITION--Also, we will face competition from other properties of the same   
type within the areas in which our apartment communities will be located.       
Competition from other properties may affect our ability to attract and retain  
residents, to increase rental rates and to minimize expenses of operation.      
Virtually all of the leases for our apartment communities will be short-term    
leases (generally, one year). Increased competition for residents may also      
require us to make capital improvements to apartment communities which we would 
not have otherwise planned to make. Any unbudgeted capital improvements we      
undertake may divert away cash that would otherwise be available for            
distributions to stockholders. Ultimately, to the extent we are unable to renew 
leases or re-lease apartment units as leases expire, it would result in         
decreased cash flow from residents and harm our operating results.              

Our financial covenants may restrict our operating activities, which may harm   
our financial condition and operating results. The mortgages on our communities 
contain and will contain customary negative covenants such as those that limit  
the owner's ability, without the prior consent of the lender, to transfer       
interests or further mortgage the applicable property or to discontinue         
insurance coverage. In addition, our affiliate line of credit contains customary
restrictions, requirements and other limitations on our ability to incur        
indebtedness, which we will have to maintain. These include the requirement to  
provide financial statements                                                    

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and information requested by the lender, and limit indebtedness to our affiliate
line of credit, property mortgages and indebtedness incurred for the payment of 
taxes and governmental charges and for services and materials in the ordinary   
course of business. We must also obtain the lender's consent to the sale or     
refinancing of any assets pledged under our affiliate line of credit, to any    
change in our control and to the placing of any lien on the pledged assets.     

We may rely on borrowings under another line of credit to finance capital       
improvement projects and for working capital, and if we are unable to borrow    
under another line of credit or to refinance existing indebtedness our financial
condition and results of operations would likely be adversely impacted. If we   
breach covenants in our debt agreements, the lender could declare a default and 
require us to repay the debt immediately and, if the debt is secured, could     
immediately take possession of the property securing the loan.                  

Our working capital reserves may not be adequate to cover all of our cash needs,
in which case we will have to obtain financing from other sources.  Our working 
capital reserves are equal to 1% of the offering proceeds and any additional    
operating reserves created at the operating level may not be adequate to cover  
all of our cash needs. In order to cover those needs, we may have to obtain     
financing from either affiliated or unaffiliated sources. We cannot assure you  
that sufficient financing will be available or, if available, will be available 
on economically feasible terms or on terms acceptable to us. Additional         
borrowings for working capital purposes will increase our interest expense, and 
therefore may have a negative impact on our results of operations.              

Our advisor may not be successful in identifying suitable additional            
acquisitions that meet our criteria.  Our advisor may not be successful in      
identifying additional suitable apartment communities that meet our acquisition 
criteria or consummating additional acquisitions on satisfactory terms. Except  
for the investments described in this prospectus, you will have no opportunity  
to evaluate the terms of transactions or other economic or financial data       
concerning our investments. You must rely entirely on the management ability of 
our advisor and the oversight of our board of directors. Failures in identifying
or consummating acquisitions could reduce the number of acquisitions we         
complete, which could in turn harm our ability to achieve our investment        
objectives and to pay distributions.                                            

We face competition for the acquisition of apartment communities, which may     
impede our ability to make future acquisitions or may                           

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increase the cost of acquisitions.  We compete with many other entities engaged 
in real estate investment activities for acquisitions of apartment communities, 
including institutional pension funds, other REITs and other owner-operators of 
apartments. These competitors may have driven up the prices we have paid for the
interests in apartment communities we have acquired, and they may drive up the  
prices we must pay for interests in apartment communities we seek to acquire or 
may succeed in acquiring those assets themselves. In addition, our potential    
acquisition targets may find our competitors to be more attractive suitors      
because they may have greater resources, may be willing to pay more or may have 
a more compatible operating philosophy. In particular, larger REITs may enjoy   
significant competitive advantages that result from, among other things, a lower
cost of capital, the ability to use their listed shares and UPREIT structure as 
currency for acquisition, and enhanced operating efficiencies. If we pay higher 
prices for communities, our profitability will be reduced, and you may          
experience a lower return on your investment.                                   

Rising operating expenses could reduce our cash flow and funds available for    
future distributions.  We bear all expenses incurred in our operations. If any  
community is not fully occupied or if rents are being paid in an amount that is 
insufficient to cover operating expense, then we could be required to expend    
funds for that community's operating expenses. The communities will be subject  
to increases in real estate and other tax rates, utility costs, operating       
expenses, insurance costs, repairs and maintenance and administrative expenses. 
In addition, our board of directors, in its discretion, may retain any portion  
of cash funds generated by operations for working capital. We cannot assure you 
that sufficient cash will be available for distribution to you.                 

Renovation of properties may result in increased costs and loss of income during
the renovation period.  Currently some of the properties that we own are        
communities which our advisor believes are undervalued mainly because of        
deferred maintenance or renovations which the seller has not performed. For     
similar communities purchased in the future, we will need to raise sufficient   
funds to make any such deferred maintenance or renovations. We will be subject  
to risks relating to the contractor's ability to control construction costs and 
meet timetables. Performance may also be affected or delayed by conditions      
beyond the contractor's control. In some cases, tenants will have to be         
relocated during the renovation. This will add to our costs. Delays in          
completion of any renovations will add to these costs. Vacant units that are    
being renovated usually cannot be rented to tenants and this will adversely     
affect our rental income. In addition, we will be subject to normal lease-up    
risks for units which were not rented during renovation.                        

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Development and construction of properties may result in delays and increased   
costs and risks.  While we have no present plans to do so, we may in the future 
invest in the acquisition of properties upon which we will develop and construct
apartment communities. We will be subject to risks relating to the builder's    
ability to control construction costs or to build in conformity with contract   
terms, plans, specifications and timetables. The builder's failure to perform   
may necessitate legal action by us to rescind the purchase or the construction  
contract or to compel performance. Performance may also be affected or delayed  
by conditions beyond the builder's control. Delays in completion of construction
could also give residents the right to terminate preconstruction leases for     
apartments at a newly developed apartment community. We may incur additional    
risks when we make periodic progress payments or other advances to such builders
prior to completion of construction since the builder may default in completing 
the project for which progress payments have been made. Factors such as these   
can result in increased costs of a project or loss of our investment. In        
addition, we will be subject to normal lease-up risks relating to newly         
constructed projects. Furthermore, we must rely upon projections of rental      
income and expenses and estimates of the fair market value of property upon     
completion of construction when agreeing upon a price to be paid for the        
property at the time of acquisition of the property. If our projections are     
inaccurate, we may pay too much for a property.                                 

Discovery of previously undetected environmentally hazardous conditions and     
physical defects may adversely affect our operating results.  Under various     
federal, state and local environmental laws, ordinances and regulations, a      
current or previous owner or operator of real property may be liable for the    
cost of removal or remediation of hazardous or toxic substances on such         
property. Such laws often impose liability whether or not the owner or operator 
knew of, or was responsible for, the presence of such hazardous or toxic        
substances. Environmental laws also may impose restrictions on the manner in    
which property may be used or business may be operated, and these restrictions  
may require expenditures. Environmental laws provide for sanctions in the event 
of noncompliance and may be enforced by governmental agencies or, in certain    
circumstances, by private parties. In connection with the acquisition and       
ownership of our communities, we may be potentially liable for such costs. The  
cost of defending against claims of liability, of compliance with environmental 
regulatory requirements or of remediating any contaminated property could       
materially adversely affect the business, assets or results of operations of our
Company and, consequently, amounts available for distribution to you. In        
addition, although we engage third parties to conduct engineering assessments of
properties we intend to acquire, we                                             

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cannot assure you that these assessments will detect latent or patent physical  
defects affecting such properties or accurately reflect the cost to repair or   
improve the property. The unforseen cost of repairing or improving a property   
could materially adversely affect the business, assets or results of operations 
of our Company and, consequently, amounts available for distribution to you.    

We may face conflicts with sellers, partners and joint venturers. We may acquire
communities from sellers that we will retain as property managers and who       
typically will continue to own an equity or other economic interest in the      
communities as the general partner or managing member of the owner limited      
partnership or limited liability Company. We will own substantially all the     
equity interests in the owner entities, with the right to remove the general    
partner or managing member without cause. While we have no present plans to do  
so, we may also enter into joint ventures with other programs affiliated with us
for the acquisition, development or improvement of properties, and we may       
develop properties in joint ventures or in partnerships or other co-ownership   
arrangements with the sellers of the properties, affiliates of the sellers,     
developers or other persons. These investments may involve risks not otherwise  
present with an investment in real estate, including, for example:              

- the possibility that our co-venturer or partner in an investment might become 
bankrupt;                                                                   

- that such co-venturer or partner may at any time have economic or business    
interests or goals which are or which become inconsistent with our business 
interests or goals; or                                                      

- that such co-venturer or partner may be in a position to take action contrary 
to our instructions or requests or contrary to our policies or objectives.  

Actions by a co-venturer or partner might have the result of subjecting the     
property to liabilities in excess of those contemplated and may have the effect 
of reducing your returns. Under certain joint venture agreements, neither       
co-venturer may have the power to control the venture, and an impasse could be  
reached regarding matters pertaining to the joint venture, which might have a   
negative influence on the joint venture and decrease potential returns to you.  

We may face certain additional risks and potential conflicts of interest in the 
event we enter into joint ventures. For example, the co-venturer may never have 
an active trading market for its equity interests. Therefore, if we become      
listed on a national securities exchange or on the NASDAQ National Market, we   
may no longer have similar goals and objectives with respect to the resale of   
properties in the future. In addition, in the event                             

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that we are not listed on a national securities exchange or on the NASDAQ       
National Market by June 22, 2015, our organizational documents provide for an   
orderly liquidation of our assets if stockholders holding a majority of our     
shares vote to authorize us to liquidate. In the event of our liquidation, any  
joint venture may be required to sell its properties at that time. Although the 
terms of any joint venture agreement could grant the co-venturer a right of     
first refusal to buy the properties held in the joint venture in the event of   
our liquidation, it is not possible to determine at this time whether the       
co-venturer would have sufficient funds to exercise the right of first refusal  
in these circumstances.                                                         

The liquidation of our assets may be delayed.  If our shares are not listed on a
national securities exchange or on the NASDAQ National Market by June 22, 2015, 
we will undertake, if stockholders owning a majority of our stock vote to       
authorize us to do so, to sell our assets and distribute the net sales proceeds 
to our stockholders, and we will thereafter engage only in activities related to
our orderly liquidation. Neither our advisor nor our board of directors may be  
able to control the timing of the sale of our interests in apartment communities
due to market conditions, and we cannot assure you that we will be able to sell 
our assets so as to return our stockholders' aggregate invested capital, to     
generate a profit for the stockholders or to fully satisfy our debt obligations.
We will only return all of our stockholders' invested capital if we sell our    
interests in communities for more than their original purchase price, although  
return of capital, for federal income tax purposes, is not necessarily limited  
to stockholder distributions following sales of properties. If we take a        
purchase money obligation in partial payment of the sales price of our interest 
in a community, we will realize the proceeds of the sale over a period of years.

We expect to make distributions that include a return of capital. We expect to  
make distributions that include a return of capital, and to the extent we do so 
prior to the repayment of our affiliate line of credit, we will have less funds 
available to repay our affiliate line of credit. We may use various             
non-operational sources of cash in order to pay such distributions. For example,
we could borrow funds on a short term basis. We could also sell additional      
shares of stock or we could sell some of our communities. If we do any of the   
foregoing, we may decrease cash available for future distributions. To the      
extent we make distributions in excess of our current or accumulated earnings   
and profits, the distribution will be treated first as a tax-free return of     
capital, reducing the tax basis in each U.S. stockholder's shares, and the      
amount of each distribution in excess of a U.S. stockholder's tax basis in its  
shares will be taxable as gain realized from the sale of its shares.            

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Risks Related to Our Organization and Structure 

The board of directors can take many actions without stockholder approval.  Our 
board of directors has overall authority to conduct our operations. This        
authority includes significant flexibility. For example, without a vote of our  
stockholders, our board may:                                                    

- amend or revise our major policies, including financing and distributions,    

- change our advisor's compensation, and employ and compensate affiliates,      

- replace our advisor with a new advisor or employ and compensate staff to      
perform some or all of our advisor's duties in-house,                       

- determine the compensation of board members,                                  

- prevent the ownership transfer and/or accumulation of shares in order to      
 protect our status as a REIT or for any other reason deemed to be in the best
interests of our stockholders,                                              

- issue additional shares, which could dilute your ownership, and               

- list the shares on a national securities exchange or market.                  

Any of these actions could reduce the value of our Company.                     

Our organizational documents contain provisions which may discourage a takeover 
of our Company and depress our stock price.  Our organizational documents       
contain provisions which may have an anti-takeover effect and inhibit a change  
in our management. These provisions include:                                    

(1) THERE ARE OWNERSHIP LIMITS AND RESTRICTIONS ON TRANSFERABILITY IN OUR       
ARTICLES OF INCORPORATION. In order for us to qualify as a REIT, no more
than 50% of the value of outstanding shares of our capital stock may be 
   owned, actually or constructively, by five or fewer individuals at any time
during the last half of each taxable year. To make sure that we will not
  fail to qualify as a REIT under this test, subject to some exceptions, our
articles prohibit any stockholder from owning actually or constructively
  more than 9.8% of the value or number of outstanding shares of our capital
 stock. Our board of directors may exempt a person from the 9.8% ownership
 limit if our board determines, in its sole discretion, that exceeding the
   9.8% ownership limit as to any proposed transferee would not jeopardize our
qualification as a REIT. This restriction may:                          

   - discourage a tender offer or other transactions or a change in management
or control that might involve the payment of a premium              

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price for our shares or otherwise be in the best interests of our   
stockholders; or                                                    

- compel a stockholder who had acquired more than 9.8% of our stock to  
      dispose of the additional shares and, as a result, to forfeit the benefits
of owning the additional shares.                                    

(2) OUR ARTICLES PERMIT OUR BOARD OF DIRECTORS TO ISSUE PREFERRED STOCK WITH    
   TERMS THAT MAY DISCOURAGE A THIRD PARTY FROM ACQUIRING US. Sections 7.1 and
   7.3 of our articles permit our board of directors to issue up to 50,000,000
shares of preferred stock, having those preferences, conversion or other
rights, voting powers, restrictions, limitations as to distributions,   
 qualifications, or terms or conditions of redemption as determined by our
   board. Thus, our board could authorize the issuance of preferred stock with
   terms and conditions which could have the effect of discouraging a takeover
 or other transaction in which holders of some or a majority of our shares
might receive a premium for their shares over the then-prevailing market
price of our shares.                                                    

(3) OUR ARTICLES AND BYLAWS CONTAIN OTHER POSSIBLE ANTI-TAKEOVER PROVISIONS.    
Section 10.3 of our articles and Sections 7 and 12 of Article II of our 
bylaws contain other provisions which may have the effect of delaying,  
    deferring or preventing a change in control of our Company or the removal of
 existing management and, as a result, could prevent our stockholders from
being paid a premium for their shares of common stock over the          
 then-prevailing marketing prices. These provisions include advance notice
   requirements for stockholder proposals and the absence of cumulative voting
rights.                                                                 

(4) MARYLAND LAW MAY DISCOURAGE A THIRD PARTY FROM ACQUIRING US. Maryland law   
    restricts mergers and other business combinations between our Company and an
    interested stockholder. An "interested stockholder" is defined as any person
    who is the beneficial owner of 10% or more of the voting power of our common
stock and also includes any of our affiliates or associates that, at any
 time within the two-year period prior to the date of a proposed merger or
  other business combination, was the beneficial owner of 10% or more of our
voting power. A person is not an interested stockholder if, prior to the
most recent time at which the person would otherwise have become an     
  interested stockholder, our board approved the transaction which otherwise
   would have resulted in the person becoming an interested stockholder. For a
period of five years after the most recent acquisition of stock by an   
 interested stockholder, we may not engage in any merger or other business
combination with that interested stockholder or any affiliate of that   
interested stockholder. After the                                       

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   five-year period, any merger or other business combination must be approved
by our board and by at least 80% of all the votes entitled to be cast by
   holders of outstanding shares of our voting stock and two-thirds of all the
votes entitled to be cast by holders of outstanding shares of our voting
    stock other than the interested stockholder or any affiliate or associate of
the interested stockholder unless, among other things, the stockholders 
 (other than the interested stockholder) receive a minimum price for their
    common stock and the consideration received by those stockholders is in cash
    or in the same form as previously paid by the interested stockholder for its
 common stock. These provisions of the business combination statute do not
 apply to business combinations that are approved or exempted by our board
prior to the most recent time that the interested stockholder becomes an
    interested stockholder. However, the business combination statute could have
the effect of discouraging offers from third parties to acquire us and  
increasing the difficulty of successfully completing this type of offer.

Our business will be harmed if we cannot engage and retain the services of      
reputable and reliable managers for our properties. Neither we nor our advisor  
will directly control the day-to-day management of our communities. Our advisor 
will retain third-party managers on our behalf who will be responsible for      
leasing, maintenance and other day-to-day management of the communities. Because
our revenues will largely be derived from rents, our financial condition will be
dependent on the ability of third-party managers that we do not control to      
operate the communities successfully. While the communities that we currently   
own interests in have experienced property managers, there can be no assurance  
that we will be able to make similar arrangements in future transactions. If our
third-party managers are unable to operate the communities successfully, our    
financial condition could be adversely affected.                                

Our rights and the rights of our stockholders to take action against our        
directors and officers are limited.  Pursuant to our charter, we have entered   
into agreements indemnifying each director for personal losses or liability     
reasonably incurred by the director in connection with any act or omission      
performed or omitted to be performed on behalf of the Company, provided that the
director has determined in good faith, that the course of conduct which caused  
the loss, or liability was in the best interests of the Company. Such           
indemnification is subject to the conditions and limitations imposed by         
Article II.G of the NASAA Guidelines and the Maryland General Corporation Law.  
Among the conditions and limitations on indemnification are requirements that   
the loss or liability not be caused by the negligence or misconduct by a        
non-independent director or the gross negligence or willful misconduct of an    
independent                                                                     

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director and that the act or omission that was material to the loss or liability
was not committed in bad faith or was not the result of active or deliberate    
dishonesty. As a result, we and our stockholders may have more limited rights   
against our directors than might otherwise exist under common law. In addition, 
we may be obligated to fund the defense costs incurred by our directors.        

Mortgage debt obligations expose us to increased risk of loss of property, which
could harm our financial condition.  We expect that all our apartment           
communities will be encumbered by permanent mortgage financing. Incurring       
mortgage debt on our communities increases our risk of loss because defaults on 
indebtedness secured by our apartment communities may result in foreclosure     
actions initiated by lenders and ultimately our loss of the community securing  
any loans which are in default. For tax purposes, a foreclosure of any of our   
communities would be treated as a sale of the community for a purchase price    
equal to the outstanding balance of the debt secured by the mortgage. If the    
outstanding balance of the debt secured by the mortgage exceeded our tax basis  
in the community, we would recognize taxable income on foreclosure, but would   
not receive any cash proceeds. The loss of part or all of our investment in a   
community could also cause the value of our shares and the distributions payable
to our stockholders to be reduced.                                              

Illiquidity of real estate investments could significantly impede our ability to
respond to adverse changes in the performance of our properties and harm our    
financial condition.  Because real estate investments are relatively illiquid,  
our ability to promptly sell one or more apartment communities in our portfolio 
in response to changing economic, financial and investment conditions is        
limited. The real estate market is affected by many factors, such as general    
economic conditions, availability of financing, interest rates and other        
factors, including supply and demand, that are beyond our control. We cannot    
predict whether we will be able to sell any community for the price or on the   
terms set by us, or whether any price or other terms offered by a prospective   
purchaser would be acceptable to us. We also cannot predict the length of time  
needed to find a willing purchaser and to close the sale of a community.        

We may be required to expend funds to correct defects or to make improvements   
before a community can be sold. We cannot assure you that we will have funds    
available to correct those defects or to make those improvements. In addition,  
the prohibition in the federal tax laws on REITs holding property for sale and  
related regulations may affect our ability to sell communities without adversely
affecting distributions to stockholders.                                        

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If we suffer losses that are not covered by insurance or that are in excess of  
our insurance coverage limits, we could lose invested capital and anticipated   
profits.  Catastrophic losses, such as losses due to wars, earthquakes, floods, 
hurricanes, pollution or environmental matters, generally are either uninsurable
or not economically insurable, or may be subject to insurance coverage          
limitations, such as large deductibles or co-payments. If one of these events   
occurred to, or caused the destruction of, one or more of our communities, we   
could lose both our invested capital and anticipated profits from that          
community.                                                                      

Your interest in our Company may be diluted if we issue additional shares and   
your distributions may be affected.  Potential investors in this offering do not
have preemptive rights to any shares issued by us in the future. Therefore,     
investors purchasing shares in this offering may experience dilution of their   
equity investment in our Company in the event that we:                          

- sell additional shares in the future, including those issued pursuant to the  
dividend reinvestment plan,                                                 

- sell securities that are convertible into shares,                             

- issue shares in a private offering of securities to institutional investors,  

- issue shares of common stock upon the exercise of options granted to our      
  independent directors or consultants and employees of our Company, our advisor
and affiliates, or                                                          

- issue shares to sellers of communities acquired by us.                        

Further, our board has the ability to issue shares of preferred stock with      
rights senior to those of our common stock, which could include superior        
dividend rights that could result in our common stockholders receiving no       
dividend distributions.                                                         

Risks Related to this Offering

We are dependent on our advisor and the property managers.  Our advisor, with   
approval from our board of directors, is responsible for our daily management,  
including all acquisitions, dispositions and financings. Our advisor, in turn,  
will retain third-party or affiliated managers on our behalf who will be        
responsible for leasing, maintenance and other day-to-day management of our     
communities. The board of directors may fire our advisor or any property        
manager, but only in certain circumstances. We cannot be sure that our advisor  
or any property manager will achieve our objectives or that the board of        
directors will be able to act quickly to remove our advisor or any property     
manager if it deems removal necessary. As a result, it is possible that we or   
one or more of our communities could be managed for some period by a Company    
that was not acting in our best interests or not capable of helping us achieve  
our objectives.                                                                 

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We have a limited operating history.  Prior to May 15, 2003, the date our       
operations commenced, we had no previous performance history. To date, we have  
acquired interests in the apartment communities described in this prospectus.   
You cannot be sure how we will be operated, whether we will pursue the          
objectives described in this prospectus or how we will perform financially.     

Payment of fees to our advisor and its affiliates were not determined in arm's  
length negotiations and will reduce cash available for investment and           
distribution.  Our advisor and its affiliates, including the dealer-manager,    
will perform services for us in connection with the offer and sale of the       
shares, the selection and acquisition of our properties and the management of   
our affairs on a day-to-day basis. They will be paid fees for these services,   
which will reduce the amount of cash available for investment in properties or  
distribution to stockholders and which may reduce the price you will receive for
any shares you may sell. The fees we will pay to our advisor and its affiliates 
were not determined in arm's-length negotiations and are not based on our       
performance.                                                                    

The performance of our properties during the period before our affiliate line of
credit must be repaid may not meet our expectations.  We have made borrowings,  
on a non-recourse basis, under our $60,000,000 line of credit with BCP Funding, 
LLC, our affiliate and an affiliate of our advisor, to acquire interests in our 
initial ten communities and which we will repay, with base interest at the rate 
of 9.5% per year plus bonus interest at 5.3% to the extent of cash available for
debt service after payment of base interest. We will pay bonus interest on the  
loans to the extent of available income from our initial ten communities, but   
not from the proceeds of this offering. The proceeds of this offering will also 
be used to repay approximately $7,897,418 (which amount represents the balance  
outstanding as of December 31, 2005 of the original note in the aggregate       
principal amount of $8,120,000) of second mortgage debt (subordinate to the     
permanent mortgage financing) encumbering the Seattle communities and to pay    
acquisition fees and expenses, our organizational expenses and the expenses of  
this offering, provided that we will not use offering proceeds to pay deferred  
acquisition fees and reimburse deferred acquisition expenses until we have      
raised at least approximately $29.5 million (not including any accrued interest 
on our affiliate line of credit or amounts distributed to stockholders from     
offering proceeds) in this offering. We have assumed that the net income from   
our communities will be sufficient to cover the 9.5% interest that we must pay  
to BCP Funding, LLC, and the 12% interest payable to the unaffiliated second    
mortgage lender and the interest payable to Wachovia in connection with the     
Wachovia loan. If our net income is less than we anticipate, the amount of      
working capital that we will have available to invest in our                    

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communities after the repayment of these borrowings will be reduced, which could
harm our ability to achieve our investment objectives and to pay distributions. 

If we do not raise sufficient funds to repay the amounts we borrowed to acquire 
our interests in our initial ten communities, we will lose our interests in all 
our communities still subject to lender liens.  We have a $60,000,000 line of   
credit with BCP Funding, LLC, our affiliate and an affiliate of our advisor,    
which we have drawn against to acquire interests in our initial ten communities.
This loan is secured by our interests in those communities. If we do not raise  
at least approximately $29.5 million (not including any accrued interest on our 
affiliate line of credit or amounts distributed to stockholders) by January 1,  
2007 we will lose our interests in all of our initial ten communities.          

In addition, in order to retain all of the communities we have acquired,        
including our Plano community, we will have to raise approximately $74,495,922  
(not including any accrued interest on our affiliate line of credit or amounts  
distributed to stockholders from offering proceeds) by January 1, 2007 and, at  
that time, repay the Wachovia loan of $5,556,348 (not including any accrued     
interest) with either borrowings under an anticipated line of credit or by      
refinancing permanent mortgage debt on our communities, or to the extent that we
have raised approximately $80,890,183 (not including any accrued interest on our
affiliate line of credit or the Wachovia loan or amounts distributed to         
stockholders from offering proceeds) by January 1, 2007, with the proceeds      
received from this offering.                                                    

Until we repay at least the approximately $29.5 million (not including any      
accrued interest on our affiliate line of credit or amounts distributed to      
stockholders from offering proceeds) borrowings related to our Jacksonville     
communities, no operating cash flow from any of our communities will be         
available to make distributions to our stockholders.  We anticipate that we will
not pay any distributions to our stockholders until after we sell a minimum of  
250,000 shares of common stock in this offering and release the proceeds of     
those sales from escrow. Until we repay our affiliate line of credit            
attributable to each of our initial ten communities, all of the cash flow       
generated from such community will be paid to BCP Funding, LLC. Once we repay   
the affiliate line of credit indebtedness for each community, BCF Funding, LLC's
lien will be released as to that community. Thus, unless we raise sufficient    
proceeds in this offering to repay the affiliate line of credit attributable to 
each community, no operating cash flow from such community will be available to 
make distributions to our stockholders. If we                                   

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raise at least approximately $29.5 million (not including any accrued interest  
on our affiliate line of credit or amounts distributed to stockholders from     
offering proceeds) in this offering, we will first repay the borrowings related 
to our Jacksonville communities. Therefore, until such time as we repay the     
borrowings related to our Jacksonville communities, we intend to pay all        
distributions to stockholders, if any, from the proceeds of this offering in    
anticipation of the availability of cash flow from our Jacksonville communities.
To the extent distributions are paid from the proceeds of this offering, we will
have less capital to repay BCP Funding, LLC, which would delay our repayment of 
our affiliate line of credit, including those borrowings related to the         
Jacksonville communities. If we do not repay all of the borrowings related to   
our initial ten communities and the Plano community by January 1, 2007, we will 
lose all of our interests in these communities, and we cannot assure you that   
our lender under our affiliate line of credit will grant us an extension beyond 
January 1, 2007.                                                                

We may not have available operating cash flows from any of the communities      
described in this prospectus to pay distributions to shareholders.  After we    
have raised the $2,500,000 minimum, subscriptions will be released from escrow  
as soon as practicable. We intend to use a portion or all of such funds to make 
distributions that include a return of capital, and we will therefore have less 
capital to repay our affiliate line of credit and the Wachovia loan, which would
delay our repayment of these borrowings. We cannot assure you that we will raise
the funds necessary to repay the portion of the line of credit respecting any of
our communities. If we fail to raise such funds, we will not have available     
operating cash flows from any of the communities described in this prospectus to
pay distributions to stockholders.                                              

We are dependent on the dealer-manager.  Boston Capital Securities, Inc., the   
dealer-manager of our offering, recently entered into an Acceptance, Waiver and 
Consent (AWC) with the NASD's Boston District office to resolve an NASD inquiry 
into Boston Capital Securities, Inc.'s offer and sale of securities in certain  
series of Boston Capital Tax Credit Fund V, L.P. ("Fund V"). The NASD staff     
found that Boston Capital Securities, Inc. violated: (i) NASD Conduct Rules     
2710(b)(4)(B)(ii) and 2110 by marketing and selling an offering of a series of  
Fund V before receiving the necessary NASD approvals; (ii) NASD Conduct         
Rules 2810(b)(4)(B) and 2110 by exceeding the NASD's underwriting compensation  
guidelines with respect to another offering of a series of Fund V; (iii) NASD   
Conduct Rules 2710(c)(2)(C) and 2110 by making incorrect disclosures regarding  
its underwriting compensation in connection with the offering as described in   
subsection (ii); and (iv) NASD Conduct Rule 3010 for having inadequate          
supervisory systems and procedures to prevent the above-mentioned rule          
violations. Boston Capital Securities, Inc. neither admitted nor denied the     

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NASD's charges, but consented to the entry of the NASD's findings, and was fined
$1.2 million. Because we are dependent on Boston Capital Securities, Inc. in    
connection with this offering, any other NASD or other regulatory actions which 
could have a material adverse effect on Boston Capital Securities, Inc. could   
also have a material adverse effect on us. Our board of directors can replace   
Boston Capital Securities, Inc. as the dealer-manager at any time.              

Stockholders may not be able to liquidate their investment promptly at a        
reasonable price.  There is no current public market for our shares, and,       
therefore, it will be difficult for you to sell your shares promptly. In        
addition, the price received for any shares sold is likely to be less than the  
proportionate value of the interests in real estate we own and, due in part to  
the illiquidity of our shares and the initial sales load, less than the initial 
public offering price. Although it is possible that our common stock may be     
listed on a national securities exchange or on the NASDAQ National Market in the
future, there is no guarantee that such a listing can or will be accomplished or
that a public market for our shares will develop, or if one develops, that the  
price received for any shares sold will equal or exceed the initial public      
offering price. Stockholders should consider their investment in our Company to 
be a long-term investment.                                                      

You cannot evaluate all of the properties we may own.  Currently, we own        
interests in the apartment communities described in this prospectus,            
representing approximately 8.0% of the amount of the maximum offering or        
approximately $80,890,183. If we continue to raise funds after we have raised   
amounts sufficient to repay all our outstanding indebtedness under our affiliate
line of credit, we will acquire interests in additional apartment communities   
which our advisor has not identified and which will be a blind pool that you    
will not have the opportunity to evaluate. You must rely on the ability of our  
advisor to find suitable additional investments. We cannot guarantee that our   
advisor will be able to find additional investments meeting our investment      
objectives or that any investment we have made or will make will generate income
for stockholders or increase in value over time. In addition, our board of      
directors may approve additional future equity offerings or obtain additional   
financing, the proceeds of which may be invested in additional communities.     
Therefore, you will not have an opportunity to evaluate all of the communities  
that will be in our portfolio prior to purchasing shares in this offering.      

Limited diversification increases risk of loss.  The number of communities that 
we will own interests in and the geographic diversity of our investments will be
reduced to the extent that the total proceeds of this                           

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offering are less than $1,000,000,000. With limited diversity, an apartment     
community with poor operating results can have a greater negative effect on our 
operations as a whole. Currently, we own properties in the Seattle, Washington, 
Portland, Oregon, Salt Lake City, Utah, Plano, Texas and Jacksonville, Florida, 
areas. If we do not raise sufficient funds to repay loans with respect to the   
communities in any of these areas, we will lose our interests in such           
communities and the geographic diversity of our investments would be reduced.   

Our management and that of our advisor have little experience investing in      
market rate apartment communities and no experience operating a REIT.  Although 
our management and that of our advisor have extensive experience in investing in
apartment communities, as we describe in the section "Prior Performance of      
Affiliates of Management," substantially all of this experience was acquired by 
managing entities that invested in apartment communities financed or operated,  
or both, with one or more forms of government subsidy. The investment objectives
of these affordable housing programs were to create certain tax benefits in the 
form of low-income housing and rehabilitation tax credits or tax losses.        
Distributions of current cash flow were not a primary objective of these        
entities. The lack of substantial experience of our management and its          
affiliates in investing in market rate apartment communities may adversely      
affect our results of operations. Neither we nor our advisor has previously     
operated a REIT; however, officers of our advisor have previously managed market
rate properties. During their more than 30-year history, our advisor and its    
affiliates and predecessors acquired 17,164 apartment units of which 3,621 were 
market rate units. However, they have not previously offered a fully market rate
community program. A REIT must operate in a manner that enables it to meet      
complex requirements under the Internal Revenue Code. If we fail to qualify as a
REIT, we will be subject to increased taxation.                                 

You are limited in your ability to sell your shares pursuant to our share       
redemption program.  Even though our share redemption program provides you with 
the opportunity to redeem your shares for $9.15 per share (or the price you paid
for the shares, if lower than $9.15) after you have held them for a period of   
one year, you should be fully aware that our share redemption program contains  
certain restrictions and limitations. Shares will be redeemed on a pro rata     
basis at the end of each quarter and will be limited to the lesser of           
(i) during any calendar year, 3% of the weighted average number of shares       
outstanding during the prior calendar year, or (ii) the proceeds we receive from
the sale of shares under our dividend reinvestment plan such that in no event   
shall the aggregate amount of redemptions under our share redemption program    
exceed aggregate proceeds received from the sale of shares pursuant to          

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our dividend reinvestment plan. Our board of directors reserves the right to    
amend or terminate the share redemption program at any time. In addition, the   
board of directors has delegated authority to our officers to reject any request
for redemption for any reason at any time. Therefore, in making a decision to   
purchase shares of our Company, you should not assume that you will be able to  
sell any of your shares back to us pursuant to our share redemption program.    

An independent underwriter will not make an independent investigation of our    
Company or the prospectus which are customarily performed in underwritten       
offerings.  The dealer-manager of this offering is one of our affiliates and    
will receive commissions and other compensation as our agent. The dealer-manager
has not retained separate counsel and will not make an independent review of us 
or the terms of the offering. Accordingly, the due diligence review of us by the
dealer-manager cannot be considered to be an independent review and therefore,  
investors will not have the benefit of an independent investigation of our      
Company as is customarily made by an unaffiliated broker-dealer or independent  
underwriters.                                                                   

There has been no public market for our common stock.   The initial public      
offering price of $10 per share was determined by our board of directors after  
consultation with the dealer-manager, based on prevailing market conditions and 
other factors, such as the prospects for our Company and the industry in which  
we compete. Our shares will not be listed on any securities exchange or market, 
and there is no assurance that any market for the shares will develop. The price
received per share for any shares you sell is likely to be less than the        
proportionate value of the real estate we own. It is also possible that after   
the offering, the price received per share for any shares you sell will be less 
than the initial public offering price.                                         

Conflicts of Interest Risks 

We will be subject to conflicts of interest arising out of our relationships    
with our advisor and its affiliates, including the material conflicts discussed 
below. The "Conflicts of Interest" section provides a further discussion of the 
conflicts of interest between us and our advisor and its affiliates and our     
policies to reduce or eliminate certain potential conflicts.                    

THERE ARE CERTAIN RELATIONSHIPS BETWEEN OUR COMPANY AND OTHER ENTITIES PROVIDING
SERVICES TO US.  Our advisor is a wholly owned subsidiary of Boston Capital     
Holdings Limited Partnership. John P. Manning, our Chairman and Chief Executive 
Officer, owns the general partner of and a limited partner interest in Boston   
Capital Holdings Limited Partnership.                                           

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Boston Capital Holdings Limited Partnership also owns 66 2/3% of the            
dealer-manager. BCP Funding, LLC, our line-of-credit lender, is a wholly owned  
subsidiary of Boston Capital Companion Limited Partnership. Mr. Manning also    
owns the general partner of and a limited partner interest in Boston Capital    
Companion Limited Partnership. Boston Capital Companion Limited Partnership owns
20,000 shares of our common stock.                                              

Our advisor was not involved in the initial formation transactions for the      
Seattle communities. Initially, an affiliate of our advisor, BC-GFS LLC, was    
formed and controlled by John P. Manning to acquire the Seattle communities from
Goodman Financial Services ("GFS"), an unaffiliated entity. GFS had already     
entered into binding contracts to purchase the Seattle communities from a third 
party seller and it agreed to assign its entire right to purchase the Seattle   
communities to BC-GFS LLC in return for the initial property management         
contracts for the communities. This included a share of cash flow and sale      
proceeds to the GFS affiliate after a preferred return on investors' unreturned 
capital contributions. The ownership of BC-GFS LLC was changed so that we now   
own 99.99% of the economic interest and BCMR Special, Inc. (which is controlled 
by Boston Capital Campanion Limited Partnership) owns 0.01% of the economic     
interest.                                                                       

THE DIRECTORS MAY DETERMINE IN THE FUTURE THAT IT MAY BE IN THE BEST INTEREST OF
OUR COMPANY TO BECOME COMPLETELY OR PARTIALLY SELF-ADMINISTERED.  In such event,
the directors may determine to acquire all or a portion of our advisor or its   
affiliates in exchange for cash, stock or other consideration. Any such         
acquisition would be subject to the conflict of interest provisions of our      
articles of incorporation governing transactions with our advisor and its       
affiliates, which generally require a finding by a majority of the directors    
(including a majority of the independent directors) that the transaction is fair
and reasonable to the Company. Depending on the circumstances and the nature and
amount of the consideration, a shareholder vote may not be required to authorize
such an acquisition.                                                            

WE WILL EXPERIENCE COMPETITION FOR PROPERTIES.  Our advisor will be selecting   
properties for other programs and entities as well as for our Company. The      
selection of properties for our Company may be subject to conflicts of interest.
We cannot be sure that our advisor will act in our best interests when deciding 
whether to allocate any particular property to us. You will not have the        
opportunity to evaluate the manner in which these conflicts of interest are     
resolved before making your investment.                                         

THERE WILL BE COMPETING DEMANDS ON OUR OFFICERS AND DIRECTORS.  Our directors   
and officers, and the officers of our advisor, have management responsibilities 
for other companies including affiliated companies. For this reason, these      
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and services among those companies and our Company, will not devote all of their
attention to our Company, and could take actions that are more favorable to the 
other companies than to our Company.                                            

THE TIMING OF ACQUISITIONS AND SALES MAY FAVOR OUR ADVISOR.  Our advisor or its 
affiliates may immediately realize 2.70% of the gross offering proceeds in      
acquisition fees and 0.5% of the gross offering proceeds for acquisition        
expenses as a result of any investment in a community by us. They may realize   
subordinated disposition fees of 3% of the sales price for communities sold     
after our stockholders receive a return of all of their invested capital plus   
the Stockholder's 6.0% Return. After stockholders have received their return of 
capital and the Stockholder's 6.0% Return, our advisor is entitled to 15% of the
remaining net sales proceeds. Our board of directors must approve any           
investments and sales, but our advisor's recommendation to the board may be     
influenced by the impact of the transaction on our advisor's compensation. Our  
advisor or its affiliates also will receive monthly 1/12th of 0.75% of the      
amount invested in communities (including all mortgage debt). The agreements    
between us and our advisor were not the result of arm's-length negotiations. As 
a result, our advisor may not always act in our best interests, which could     
adversely affect our results of operations. The agreements between us and our   
advisor were negotiated by the same person, but our independent directors did   
review and approve the agreements.                                              

WE HAVE BORROWED FROM AN AFFILIATE OF OUR ADVISOR AND AN AFFILIATE OF OUR       
ADVISOR HAS GUARANTEED CERTAIN OF OUR DEBT.  BCP Funding, LLC, our              
line-of-credit lender, and a guarantor of our loan with Wachovia Bank, National 
Association, is an affiliate of our advisor. The negotiations for the terms of  
our affiliate line of credit did not have the benefit of arm's-length           
negotiations of the type that would be associated with borrowing from an        
unaffiliated lender. The base interest rate is 9.5% per annum plus bonus        
interest at 5.3% to the extent of cash available for debt service after payment 
of base interest. Until the line of credit attributable to each community is    
repaid by the due date, effectively all cash flow generated by such community   
will be paid to BCP Funding, LLC. The effective rate of interest on the line of 
credit is the stated base interest of 9.5% since historically no bonus interest 
has been paid.                                                                  

WE MAY INVEST WITH AFFILIATES OF OUR ADVISOR.  We may invest in joint ventures  
with other programs sponsored by our advisor or its affiliates. Our board of    
directors, including the independent directors, must approve the transaction,   
but our advisor's recommendation may be affected by its relationship with one or
more of the co-venturers and may be more beneficial to the other programs than  
to us. Such a joint venture with an affiliate might be considered if an         
investment opportunity in apartment                                             

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communities in the United States was too large for us to invest in without a    
joint venture partner. Any joint venture would have to be consistent with our   
investment objectives and policies. Joint venture negotiations with affiliates  
would not have the benefit of arm's-length negotiations.                        

THERE IS NO SEPARATE COUNSEL FOR OUR COMPANY, OUR AFFILIATES AND                
STOCKHOLDERS.  We may have interests that conflict with yours and those of our  
affiliates, but in connection with this offering, none of us has separate       
counsel.                                                                        

Your subscription payment is irrevocable.  Once we have accepted your           
subscription to purchase shares in this offering, your subscription is          
irrevocable and you cannot withdraw your payment for your shares unless we raise
less than the $2,500,000 minimum. After we have raised the $2,500,000 minimum,  
subscriptions will be released from escrow as soon as practicable. You will not 
be able to withdraw your payment for your shares even after the $2,500,000      
minimum has been raised.                                                        

Tax and Employee Benefit Plan Risks 

If we fail to remain qualified as a REIT, our distributions will not be         
deductible by us, and our income will be subject to taxation, reducing our      
earnings available for distribution.  We intend to qualify beginning with the   
tax year ended December 31, 2005 and to remain qualified as a REIT under the    
Internal Revenue Code for as long as being so qualified affords us significant  
tax advantages. The requirements for this qualification, however, are complex.  
If we fail to meet these requirements, our distributions will not be deductible 
to us and we will have to pay a corporate level tax on our income. This would   
substantially reduce our cash available to pay dividends and your yield on your 
investment in our stock. In addition, such a tax liability might cause us to    
borrow funds, liquidate some of our investments or take other steps which could 
negatively affect our operating results. Moreover, if our REIT status is        
terminated because of our failure to meet a technical REIT requirement or if we 
voluntarily revoke our election, we would generally be disqualified from        
electing treatment as a REIT for the four taxable years following the year in   
which REIT status is lost.                                                      

Because we acquired properties prior to qualification as a REIT, we may face    
certain tax consequences.  We have acquired properties prior to the first day of
the first taxable year for which we expect to qualify as a REIT (which is       
anticipated to be January 1, 2005, or the "REIT Commencement Date"). If we      
recognize gain on the disposition of any of these assets during the 10-year     
period beginning on the REIT Commencement Date, then we will be subject to tax  
at the highest regular corporate rate on the lesser of (A) the fair market value
of the asset as of the REIT                                                     

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Commencement Date over our basis in the asset as of the REIT Commencement Date  
(the "Built-In Gain"), or (B) the amount of gain we would otherwise recognize on
the disposition. We would be subject to this tax liability even if we qualify   
and maintain our status as a REIT. In order to qualify as a REIT, we will be    
required to distribute an amount equal to at least 90% of the Built-In Gain     
(after payment of a corporate level tax), if any, recognized on the disposition 
of any of these assets during the 10-year period beginning on the REIT          
Commencement Date.                                                              

In addition, to qualify as a REIT, we cannot have at the end of any taxable year
any undistributed earnings and profits that are attributable to a non-REIT      
taxable year. We do not believe that we have any non-REIT earnings and profits  
and therefore we believe that we satisfy this requirement.                      

Even REITs are subject to federal and state income taxes.  Even if we qualify   
and maintain our status as a REIT, we may become subject to federal income taxes
and related state taxes. For example, if we have net income from the sale or    
other disposition of inventory or property, other than foreclosure property,    
held primarily for sale to customers in the ordinary course of business, that   
income will be subject to applicable federal income taxes and related state     
taxes. We may not be able to make sufficient distributions to avoid excise taxes
applicable to REITs. We may also decide to retain income we earn from the sale  
or other disposition of a property and pay income tax directly on that income.  
In that event, our stockholders would be treated as if they earned that income  
and paid the tax on it directly. However, stockholders that are tax-exempt, such
as charities or qualified pension plans, would have no benefit from their deemed
payment of that tax liability. We cannot assure you that we will be able to     
continue to satisfy the REIT requirements, or that it will be in our best       
interests to continue to so do. We may also be subject to state and local taxes 
on our income, and our communities will be subject to property taxes.           

If more than fifty percent in value of our outstanding shares is owned directly,
indirectly or through attribution by five or fewer individuals at any time after
June 30, 2006, we will not qualify as a REIT for 2006 and subsequent taxable    
years. Under Sections 856(a)(6) and 856(h) of the Internal Revenue Code, no five
or fewer individuals (as defined in Code Section 542(a)(2) and taking into      
account the look through rule of Section 856(h)(3) of the Internal Revenue Code)
can own during the last half of any taxable year more than fifty percent in     
value of the outstanding shares of the capital stock of a REIT directly,        
indirectly, or through the application of the attribution rules of Section 544  
of the                                                                          

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Internal Revenue Code (as modified by Section 856(h)(1)(B) of the Internal      
Revenue Code), other than with respect to the first taxable year for which a    
REIT election is made ("Five/Fifty Requirement"). As of the date hereof, more   
than fifty percent in value of the outstanding shares of our capital stock is   
owned directly, indirectly, or through attribution by five or fewer individuals.
If we do not satisfy the Five/Fifty Requirement by June 30, 2006 (and for the   
remainder of 2006), we will not qualify as a REIT for 2006 and subsequent       
taxable years.                                                                  

An investment in our common stock may not be suitable for every employee benefit
plan.  When considering an investment in our common stock, an individual with   
investment discretion over assets of any pension plan, profit-sharing plan,     
retirement plan, IRA or other employee benefit plan covered by ERISA should     
consider whether the investment satisfies the requirements of Section 404 of    
ERISA or other applicable laws. In particular, attention should be paid to the  
diversification requirements of Section 404(a)(3) of ERISA in light of all the  
facts and circumstances, including the portion of the plan's portfolio of which 
the investment will be a part. All plan investors should also consider whether  
the investment is prudent and meets plan liquidity requirements as there may be 
only a limited market in which to sell or otherwise dispose of our common stock,
whether the investment is permissible under the plan's governing instrument, and
whether the investment could be a prohibited transaction under ERISA or the     
Internal Revenue Code. Also, the annual determination of the fair market value  
of that plan's assets required of the fiduciary may be difficult because there  
is no public market for the stock. We have not, and will not, evaluate whether  
an investment in our common stock is suitable for any particular plan.          

INVESTOR SUITABILITY STANDARDS

The shares we are offering are suitable only as a long-term investment for      
persons of adequate financial means. We do not expect to have a public market   
for the shares, which means that it may be difficult for you to sell your       
shares. You should not buy these shares if you need to sell them immediately or 
will need to sell them quickly in the future.                                   

In consideration of these factors, we have established suitability standards for
initial stockholders and subsequent transferees. These suitability standards    
require that a purchaser of shares have either:                                 

- a net worth of at least $150,000; or                                          

- a gross annual income of at least $45,000 and a net worth of at least $45,000.

Net worth shall be determined exclusive of the value of a purchaser's home, home
furnishings and automobiles.                                                    

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The minimum purchase is 100 shares ($1,000), except in certain states as        
described below. You may not transfer fewer shares than the minimum purchase    
requirement. In addition, you may not transfer, fractionalize or subdivide your 
shares so as to retain less than the number of shares required for the minimum  
purchase. In order to satisfy the minimum purchase requirements for retirement  
plans, unless otherwise prohibited by state law, a husband and wife may jointly 
contribute funds from their separate IRAs, and jointly meet suitability         
standards, provided that each such contribution is made in increments of $100.  
You should note that an investment in shares of our Company will not, in itself,
create a retirement plan and that, in order to create a retirement plan, you    
must comply with all applicable provisions of the Internal Revenue Code.        

The minimum purchase for Maine, New York and North Carolina residents is 250    
shares ($2,500), except for IRAs which must purchase a minimum of 100 shares    
($1,000). The minimum purchase for Minnesota residents is 250 shares ($2,500),  
except for IRAs and other qualified retirement plans which must purchase a      
minimum of 200 shares ($2,000). Following an initial subscription for at least  
the required minimum investment, any investor may make additional purchases in  
increments of at least ten shares ($100), except for purchases made by residents
of Maine and Minnesota, whose additional investments must meet their state's    
minimum investment amount, and purchases of shares pursuant to our dividend     
reinvestment plan, which may be in lesser amounts.                              

Several states have established suitability standards different from those we   
have established. Shares will be sold only to investors in these states who meet
the special suitability standards set forth below.                              

Arizona, California, Iowa, Massachusetts, Michigan, Missouri, North Carolina,   
New Mexico, Texas and Tennessee--Investors must have either (i) a net worth of  
at least $225,000 or (ii) gross annual income of $60,000 and a net worth of at  
least $60,000.                                                                  

Maine--Investors must have either (i) a net worth of at least $200,000 or       
(ii) gross annual income of $50,000 and a net worth of at least $50,000.        

Iowa, Michigan, Missouri, Ohio, Oregon and Pennsylvania--In addition to our     
suitability requirements, investors must have a net worth of at least ten times 
their investment in our Company.                                                

New Hampshire--Investors must have either (i) a net worth of at least $250,000  
or (ii) taxable income of $50,000 and a net worth of at least $125,000.         

Kansas--Investors must have either (i) gross annual income of at least $60,000  
and a net worth of at least $60,000; or (ii) a minimum net worth                

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of at least $225,000 plus a liquid net worth of at least ten times their        
investment in the Company.                                                      

Because the minimum offering of our common stock is less than $50,000,000,      
Pennsylvania investors are cautioned to carefully evaluate our ability to fully 
accomplish our stated objectives and to inquire as to the current dollar volume 
of Company subscriptions.                                                       

We will place all Pennsylvania investor subscriptions in escrow until we have   
received total subscriptions of at least $50,000,000, or for an escrow period of
120 days, whichever is shorter.                                                 

If we have not received total subscriptions of at least $50,000,000 by the end  
of the escrow period, we must:                                                  

A.  Return the Pennsylvania investors' funds within 15 calendar days of the end 
of the escrow period; or                                                

B.  Notifiy the Pennsylvania investors in writing by certified mail or any other
   means whereby receipt of delivery is obtained within 10 calendar days after
  the end of the escrow period, that the Pennsylvania investors have a right
to have their investment returned to them. If an investor requests the  
   return of such funds within 10 calendar days after receipt of notification,
   the Company must return such funds within 15 calendar days after receipt of
the investor's request.                                                 

No interest is payable to an investor who requests a return of funds at the end 
of the initial 120-day escrow period. Any Pennsylvania investor who requests    
return of funds at the end of any subsequent 120-day escrow period will be      
entitled to receive interest earned, if any, for the time that the investor's   
funds remain in escrow commencing with the first day after the initial 120-day  
escrow period.                                                                  

In the case of sales to fiduciary accounts, these suitability standards must be 
met by the fiduciary account, by the person who directly or indirectly supplied 
the funds for the purchase of the shares or by the beneficiary of the account.  
These suitability standards are intended to help ensure that, given the         
long-term nature of an investment in our shares, our investment objectives and  
the relative illiquidity of our shares, our shares are an appropriate investment
for those of you desiring to become stockholders. Each participating            
broker-dealer must make every reasonable effort to determine that the purchase  
of shares is a suitable and appropriate investment for each stockholder based on
information provided by the stockholder in the subscription agreement, a form of
which accompanies this prospectus as Exhibit B. Each participating broker-dealer
is required to maintain for six years records of the information used to        
determine that an investment in the shares is suitable and appropriate for a    
stockholder.                                                                    

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ESTIMATED USE OF PROCEEDS 

The following table sets forth information about how we intend to use the       
proceeds raised in this offering assuming that we sell 250,000 shares and       
100,000,000 shares, respectively, in the offering. Many of the figures set forth
below represent management's best estimate since they cannot be precisely       
calculated at this time. We expect to invest 84.55% of the money we raise in    
this offering in apartment communities, while the remaining 15.45% will be used 
for working capital and to pay expenses and fees, including the payment of fees 
to the dealer-manager and our advisor.                                          

The current amount outstanding under our line of credit with our affiliate BCP  
Funding, LLC is $56,596,665. The entire line of credit is due and payable on    
January 1, 2007. If we raise at least approximately $29.5 million (not including
any accrued interest on our affiliate line of credit or amounts distributed to  
stockholders from offering proceeds) necessary to repay our affiliate line of   
credit related to our Jacksonville communities, $24,954,067 of such amount will 
be used to repay our affiliate line of credit. If we raise the $74,495,922 (not 
including any accrued interest on our line of credit or amounts distributed to  
stockholders from offering proceeds) necessary to purchase all of our initial 10
communities, a total of $56,596,665 of such amount will be used to repay the    
line of credit to our affiliate and approximately $7,987,418 (which amount      
represent the balance outstanding as of December 31, 2005 of the original note  
in the aggregate principal amount of $8,120,000) will be used to repay the      
second mortgage loan on the Seattle communities. Once we have raised            
$74,495,922, we may repay the Wachovia loan with either borrowings under an     
anticipated line of credit or by refinancing permanent mortgage debt on our     
communities, or to the extent that we have raised approximately $80,890,183 in  
this offering (not including any accrued interest on our affiliate line of      
credit or the Wachovia loan or amounts distributed to stockholders from offering
proceeds) by January 1, 2007, with the proceeds received from this offering. The
interest on our affiliate line of credit accrues in arrears at an annual base   
rate of 9.5% plus bonus interest at 5.3% to the extent of cash available for    
debt service after payment of base interest, and is due and payable quarterly to
the extent of cash available for debt service for that quarter and, to the      
extent base interest is not paid, will be added to principal. Further, bonus    
interest on the loans is due and payable quarterly only to the extent of cash   
available for debt service for that quarter after payment of the base rate of   
9.5% interest for that quarter, and to the extent not paid will accrue but will 
not be added to principal or be considered in calculating the 9.5% interest.    
Accrued bonus interest will be payable quarterly without further interest to the
extent of cash available for debt service for that quarter only after payment of
9.5% interest and bonus interest for that quarter.                              

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The maximum offering amounts below excludes 5,000,000 shares that may be sold   
pursuant to the dividend reinvestment plan. As long as our shares are not listed
on a national securities exchange or market, it is anticipated that the proceeds
from the dividend reinvestment plan will be used to fund our share redemption   
program. Our share redemption program is only intended to provide interim       
liquidity for stockholders until a secondary market develops, if ever, for the  
shares. In addition, the number of shares of common stock to be outstanding     
after this offering excludes 4,000,000 shares reserved for issuance under our   
equity incentive plan. See "Management--Equity Incentive Plan."                 

Gross offering proceeds are calculated as if all shares are sold at $10 per     
share and do not take into account any reduction in selling commissions. See    
"Selling and Escrow Arrangements" for a description of the circumstances in     
which selling commissions may be reduced. Selling commissions are calculated    
assuming that commissions are not reduced in connection with the purchase of any
shares. The shares are being offered to the public through Boston Capital       
Securities, Inc., which will receive selling commissions of 7% on all sales of  
shares and will act as dealer-manager. The dealer-manager is an affiliate of our
advisor. Other unaffiliated broker-dealers may be engaged to sell shares and be 
reallowed selling commissions of up to 7% with respect to shares they sell. In  
addition, up to 1.5% of the dealer-manager fee may be reallowed to              
broker-dealers for expenses incurred by them in selling the shares, in the sole 
discretion of the dealer-manager. See "Selling and Escrow Arrangements" for a   
more complete description of this fee.                                          

The item "Organization and offering expenses" in the following chart includes,  
among others, legal, accounting, escrow, printing, registration, qualification, 
distribution, filing and other accountable expenses incurred in connection with 
the organization of our Company, the structuring of our Company's investments   
and the offering of shares. If the organization and offering expenses (excluding
selling commissions and the dealer-manager fee described above) exceed 2.25% of 
the gross offering proceeds, the excess will be paid by our advisor without     
recourse to us.                                                                 

The purchase price for each community included prepaid acquisition fees in the  
aggregate amount of $1,444,844. These fees were prepaid to an affiliate, Boston 
Capital Holdings Limited Partnership, as follows: $470,908 for the Jacksonville 
communities (1.60% of the offering proceeds related to Jacksonville); $552,794  
for the Seattle communities (2.79% of the offering proceeds related to Seattle);
and $421,142 for the Portland/Salt Lake communities (1.63% of the offering      
proceeds related to Portland/Salt Lake communities). These amounts will be      
deducted from the 2.70% acquisition                                             

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fee we have agreed to pay our advisor with respect to each of the communities.  
Offering proceeds will not be reduced by any prepaid acquisition fee relating to
a specified community if sufficient offering proceeds are not raised to release 
the respective community from our affiliate line of credit. If we raise at least
approximately $29.5 million (not including any accrued interest on our affiliate
line of credit or amounts distributed to stockholders from offering proceeds),  
we will keep our interest in Jacksonville. We will not pay our advisor deferred 
acquisition fees relating to a community until we raise sufficient funds to     
repay amounts outstanding under the loans with respect to that community. Thus, 
once we have raised at least approximately $29.5 million (not including any     
accrued interest on our affiliate line of credit or amounts distributed to      
stockholders from offering proceeds) and the liens on our Jacksonville          
communities have been released, we will pay our advisor an acquisition fee      
attributable to our Jacksonville communities of 2.7% of offering proceeds, which
equals $796,500. Since a portion of the acquisition fee in the amount of        
$470,908 attributable to the Jacksonville communities has already been paid, if 
we raise at least approximately $29.5 million (not including any accrued        
interest on our affiliate line of credit or amounts distributed to stockholders 
from offering proceeds), we would pay an additional $325,592 in acquisition     
fees, which represents the $796,500 fee due less the prepaid fee of $470,908.   

The item "Acquisition expenses" in the following chart consists of legal and    
accounting fees and travel, communication and other expenses to be paid to third
parties and amounts to be paid to our advisor for selecting, evaluating,        
negotiating and closing our Company's investments in apartment communities.     

The purchase price for each community included prepaid acquisition expense      
reimbursements in the aggregate amount of $189,009. These expense reimbursements
were prepaid to an affiliate, Boston Capital Holdings Limited Partnership, as   
follows: $73,519 for our Jacksonville communities (.25% of the offering proceeds
related to Jacksonville); $49,739 for our Seattle communities (.25% of the      
offering proceeds related to Seattle communities); and $65,751 for our          
Portland/Salt Lake communities (.25% of the offering proceeds related to        
Portland/Salt Lake communities). These amounts will be deducted from the 0.5%   
acquisition expense reimbursement we have agreed to pay our advisor with respect
to each of the communities. Offering proceeds will not be reduced by any prepaid
acquisition expense reimbursements relating to a specified community if         
sufficient offering proceeds are not raised to release the respective community 
from our affiliate line of credit. We will not pay our advisor additional       
acquisition expense reimbursement relating to a community until we raise        
sufficient funds to repay amounts outstanding under the loans with              

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respect to that community. Thus, once we have raised at least approximately     
$29.5 million (not including any accrued interest on our affiliate line of      
credit or amounts distributed to stockholders from offering proceeds) and the   
liens on our Jacksonville communities have been released, we will pay our       
advisor an acquisition expense reimbursement attributable to our Jacksonville   
communities of 0.5% of offering proceeds, which equals $147,500. Since a portion
of the acquisition expense reimbursement in the amount of $73,519 attributable  
to the Jacksonville communities has already been paid, if we raise at least     
approximately $29.5 million (not including any accrued interest on our affiliate
line of credit or amounts distributed to stockholders from offering proceeds),  
we would pay an additional $73,981 in acquisition fees, which represents the    
$147,500 additional acquisition expense reimbursement due less the prepaid      
expense reimbursement of $73,519.                                               

Money in the working capital reserve will be available for contingencies        
relating to the operation, management and administration of the apartment       
communities and our Company, to the extent other funds are not so available. In 
addition, funds held in the working capital reserve can be used for option      
and/or other payments and interest expense incurred (all to unaffiliated third  
parties) to secure the acquisition of apartment communities. Working capital    
reserves will not be used to pay additional compensation, expenses or fees to   
insiders or affiliates.                                                         

At a minimum, the amount of offering proceeds which will be invested in         
apartment communities (or to retire debt used to acquire apartment communities) 
will be 84.55% of the total offering proceeds. At the first closing, and at each
subsequent closing when there are borrowings outstanding under our line of      
credit that were used to acquire our interests in apartment communities, we will
apply the net available for investment in properties to the repayment of those  
borrowings. As we repay the borrowings used to acquire our interest in a        
portfolio of apartment communities in accordance with the terms of our loan     
agreement, the lender will release its lien on our interest in that portfolio of
apartment communities.                                                          

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Estimated Use of Proceeds Table 

                                                        [Enlarge/Download Table]

                         Minimum         Sales of 8,089,018      Maximum                    
                         offering        shares (minimum         Offering                   
                                         amount necessary                                   
                                         to repay                                           
                                         indebtedness on                                    
                                         our affiliate line                                 
                                         of credit,                                         
                                         Wachovia loan                                      
                                         and the Seattle                                    
                                         second mortgage                                    
                                         loan)(6)                                           
                                                                                            
Common Stock Offered...     250,000 shares      8,089,018  shares    100,000,000 shares     
Shares of common stock                                                                      
  outstanding after the                                                                     
  offering.............     270,000 shares      8,109,018  shares    100,020,000 shares     
Estimated use of gross                                                                      
  offering proceeds....  $2,500,000         $80,890,183          $1,000,000,000       100.0%
                         ----------         -----------          --------------       ----- 
  Less Public Offering                                                                      
    Expenses:                                                                               
    Selling                                                                                 
      commissions......     175,000           5,662,313              70,000,000         7.0%
    Dealer-manager                                                                          
      fee..............      50,000           1,617,804              20,000,000         2.0%
    Organization and                                                                        
      Offering                                                                              
      Expenses(1)......      56,250           1,820,029              22,500,000        2.25%
                         ----------         -----------          --------------       ----- 
  Total offering                                                                            
    expenses...........     281,250           9,100,146             112,500,000       11.25%
                         ----------         -----------          --------------       ----- 
Amount available after                                                                      
  Offering Expenses....  $2,218,750         $71,790,037          $  887,500,000       88.75%
                         ==========         ===========          ==============       ===== 
Acquisition fees(2)....      67,500           2,184,035(3)           27,000,000        2.70%
Acquisition expenses...      12,500             404,451(4)            5,000,000         0.5%
Working capital                                                                             
  reserve..............      25,000             808,902              10,000,000         1.0%
                         ----------         -----------          --------------       ----- 
Net available for                                                                           
  investment in                                                                             
  properties                                                                                
  (by repayment of                                                                          
  debt, if                                                                                  
  outstanding).........  $2,113,750         $68,392,649(5)       $  845,500,000       84.55%

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

(1) If organization and offering expenses (excluding selling commissions and the
 dealer-manager fee) exceed 2.25% of the proceeds raised in this offering,
the excess will be paid by our advisor without recourse to us.          

(2) We will not pay our advisor deferred acquisition fees relating to a         
    community until we raise sufficient funds to repay amounts outstanding under
 our affiliate line of credit, or with respect to the Plano community, the
Wachovia loan. See "Estimated Use of Proceeds."                         

(3) Includes $1,444,844 in prepaid acquisition fees.                            

(4) Includes $189,009 in prepaid acquisition expenses.                          

(5) This amount does not include funds not utilized for payment of acquisition  
fees and expense reimbursements due to the fact that a portion of the   
acquisition fees and acquisition expenses have been prepaid as noted in 
notes (3) and (4). Therefore, such funds will also be available for     
investment in properties (by repayment of debt, if outstanding).        

(6) Amounts necessary to repay this indebtedness do not include accrued         
interest.                                                               

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DISTRIBUTION POLICY 

We intend to pay regular quarterly distributions to holders of our common stock.
Any distributions we make, however, will be at the discretion of our board of   
directors, in accordance with our earnings, cash flow, capital needs and general
financing condition. Distributions will be made to those holders of our common  
stock who are holders of our common stock as of the record date selected by our 
board of directors. We intend to pay our first distribution with respect to the 
first full quarter ending after the first closing date or at any other time as  
declared by our board of directors. We expect to initially make distributions   
that include a return of capital. Because we will not have cash available for   
distributions to stockholders until we raise at least approximately             
$29.5 million (not including any accrued interest on our affiliate line of      
credit or amounts distributed to stockholders from offering proceeds) and pay   
off the borrowings related to our Jacksonville communities, we anticipate paying
all or a significant portion of initial distributions from the proceeds of this 
offering or from short-term borrowings, including borrowings from affiliates. We
cannot assure you that our intended distribution policy will be sustained. Our  
actual results of operations may differ materially from our current             
expectations. Our actual results of operations and, accordingly, cash available 
for distribution as quarterly distributions, will be affected by a number of    
factors, including the revenue we receive from our communities, our operating   
expenses, interest expense, the ability of our residents to meet their          
obligations and unanticipated expenditures. For more information regarding risk 
factors that could materially adversely affect our actual results of operations,
please see "Risk Factors," beginning on page 42. In addition, variations in the 
net proceeds from this offering as a result of a failure to sell the maximum    
number of shares offered may affect our cash available for distributions and    
available reserves, which may affect our ability to pay the contemplated        
distributions.                                                                  

We are required to make distributions sufficient to satisfy the requirements for
qualification as a REIT for tax purposes. Our board's discretion as to the      
payment of distributions will be directed, in substantial part, by its          
obligation to cause us to comply with the REIT requirements. Generally, income  
distributed as dividends will not be taxable to us under federal income tax law 
if we distribute annually at least 90% of our REIT taxable income. For more     
information, please see "Material United States Federal Income Tax              
Considerations--Taxation of the Company--Annual Distribution Requirements." Our 
income depends on the income or profits derived by our subsidiaries, who hold   
the fee simple title to the communities. None of our tax losses will be passed  
through to you. Taxable income and actual cash available for distribution are   
not the same. We expect that we will make one or more distributions in excess of
cash                                                                            

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available for distributions in order to meet these distribution requirements,   
and we may need to borrow funds to make these required distributions. To the    
extent we make distributions in excess of our current or accumulated earnings   
and profits, the distribution will be treated first as a tax-free return of     
capital, reducing the tax basis in each U.S. stockholder's shares, and the      
amount of each distribution in excess of a U.S. stockholder's tax basis in its  
shares will be taxable as gain realized from the sale of its shares.            

BUSINESS AND PROPERTIES 
Overview

We are a newly-formed Maryland corporation. Assuming the sale of at least       
250,000 shares in this offering, we expect to operate as a REIT that will own   
interests in, lease and maintain apartment communities in the United States,    
typically garden apartments and select mid-rise properties of 150 or more rental
units that are located in suburban or metropolitan areas.                       

Generally, our interests in each community (or, where appropriate, in each      
related group of communities) will be owned by a limited liability Company or   
other entity wholly owned by us. The communities themselves will be owned by    
subsidiaries of limited liability companies in which our subsidiary-owner       
companies will own the equity interest and in which unaffiliated third parties  
will have a subordinated economic interest. Decisions relating to the purchase  
and sale of interests in communities will be made by our advisor, subject to the
approval of our board of directors. Our communities will be managed by          
third-party managers selected by our advisor and approved by our board of       
directors. Currently, our communities in Seattle, Portland and Salt Lake City   
are managed by Pinnacle Realty Management Company, our Jacksonville communities 
are managed by Bainbridge Management Jacksonville LLC, and our Plano community  
is managed by Alliance Residential, LLC, none of which is affiliated with us or 
our advisor. We may hire Pinnacle, Bainbridge or Alliance to manage other       
communities if those communities are in areas in which Pinnacle, Bainbridge or  
Alliance does business and our advisor and our board determines that Pinnacle,  
Bainbridge or Alliance is the best choice.                                      

Property Selection Process

When making investments in apartment communities, our advisor considers relevant
real property and financial factors, including the condition and location of the
community, its income-producing capacity and the prospects for its long-term    
appreciation. The proper location, design and amenities are important to the    
success of a community.                                                         

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Apartment communities under consideration are first subjected to a comprehensive
due diligence review. In selecting specific communities, our advisor, as        
approved by our board of directors, applies the following minimum standards:    

- The apartment community is in what our advisor considers to be a quality      
market area within locations that provide stability and upside potential.   

- We will endeavor to maintain an aggregate mortgage indebtedness on our        
  communities totaling between 55% and 65% but in any event not more than 70% of
 our gross asset value, but this is not a limitation on the amount of mortgage
 indebtedness on any one community acquired, and we have no limitations in our
  organizational documents regarding the amount of mortgage and other borrowings
on our communities. The aggregate amount of our indebtedness outstanding at 
any time, however, may not exceed 300% of our net assets.                   

- For communities acquired before the minimum offering of $2.5 million has been 
raised, the communities have at least 18 months of stable operations;       
following such period, we expect that at least 90% of the communities will  
meet this standard.                                                         

1. The location considerations include characteristics of the surrounding area
   and the suitability of the neighborhood services and amenities available to
  the resident base. Our advisor considers accessibility to the community by
  both public and private transportation, and its visibility and curb appeal
  to prospective residents. Property considerations include physical aspects
of the property, its condition, quality of design and materials and its 
amenities.                                                              

2. The market area is characterized as having current and long-term suitable  
    demographic and economic conditions. Our advisor considers supply and demand
factors and determines whether the capture rates in the primary and     
secondary market areas are within appropriate standards for the resident
   base. Our advisor also considers the competitive advantage of the community
as compared with competing properties in the same market area.          

3. In its determination of the stability of the communities' operations, our  
advisor considers the potential impact of rent growth, turnover, rent   
discounts, concessions and other factors that exist or may exist in the 
competitive environment.                                                

4. The community must be in a market area possessing attractive investment    
 attributes, including income growth, stability and upside associated with
improving market fundamentals and/or value added through renovation or  
repositioning of the property.                                          

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5. Our advisor must determine, through third-party environmental and          
   engineering assessments, that the property is not subject to any recognized
environmental or physical conditions or deferred maintenance costs that 
would impact the future operations, marketability or salability of the  
property.                                                               

6. The community's management team, including any potential joint venture     
   partners, must demonstrate substantial experience, where applicable, in the
    design, development and management of market rate apartment communities. Our
   advisor considers each individual's or entity's current financial position,
    past financial performance and performs credit checks, background checks and
reference reviews.                                                      

7. Communities will not be acquired from our advisor or any of its affiliates 
 unless a majority of the independent directors approve the transaction as
  being fair and reasonable to us and at a price no greater than the cost of
    the asset to such advisor or affiliate, or if the price is in excess of such
   cost, that substantial justification for such excess exists and such excess
is reasonable.                                                          

Properties

The apartment communities we own interests in are described below. Typically, a 
wholly owned subsidiary of our Company owns limited liability Company interests 
(representing all of the equity) in a limited liability Company (LLC) that owns,
through wholly owned subsidiaries, a group of apartment communities. The manager
of the LLC that owns apartment communities through wholly owned subsidiaries is 
typically an affiliate of the property manager, and typically has a small       
economic interest in the LLC. We have the right to remove and replace the LLC   
manager at any time without cause. We believe that this arrangement is an       
appropriate incentive to encourage performance by the manager of the LLC. In the
future, we may also own communities directly, or, as we have done with respect  
to our Plano community, through joint ventures, with affiliated or unaffiliated 
third parties.                                                                  

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The following chart shows the typical structure of our investment in apartment  
communities:                                                                    

----------------------------------------------
*                    REIT                    *
----------------------------------------------
 *
     *100%
 *
----------------------------------------------
*      REIT SUBSIDIARY IN WHICH THE REIT     *
*          HAS A 100% OWNERSHIP AND          *
*              ECONOMIC INTEREST             *
----------------------------------------------
 *
     *100%
 *
----------------------------------------------
*        100%-OWNED ENTITY IN WHICH AN       *
*     UNAFFILIATED THIRD PARTY SHARES AN     *
* ECONOMIC INTEREST SUBORDINATE TO THE REITs *
----------------------------------------------
 *
     *100%
 *
----------------------------------------------
*    ENTITY HOLDING TITLE TO THE COMMUNITY   *
----------------------------------------------

The aggregate purchase price for our interests in our apartment communities was 
approximately $62,153,013, and we acquired them by borrowing $56,596,665 under  
our affiliate line of credit, and with respect to our Plano community, through a
$5,556,348 loan with Wachovia Bank, National Association. If we raise at least  
approximately $29.5 million (not including any accrued interest on our affiliate
line of credit or amounts distributed to stockholders from offering proceeds)   
necessary to repay our affiliate line of credit related to our Jacksonville     
communities, $24,954,067 of such amount will be used to repay our affiliate line
of credit, and our line-of-credit lender will release its lien on our interests 
in those communities, but not its liens on the balance of our interests in      
communities, which will only be released if we raise sufficient additional funds
in this offering to repay the balance of our affiliate line of credit. Assuming 
we raise sufficient additional funds, we will repay the balance in one or more  
installments, as additional closings are held, first repaying our borrowings    
related to our Portland and Salt Lake City communities, and then repaying our   
borrowings related to our Seattle communities. We may then repay the Wachovia   
loan with either borrowings under an anticipated line of credit or by           
refinancing permanent mortgage debt on our communities, or to the extent that we
have raised approximately $80,890,183 (not including any accrued interest on our
affiliate line of credit or the Wachovia loan or amounts distributed to         
stockholders from offering proceeds) by January 1, 2007, with the proceeds      
received from this offering. We also                                            

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have the right to make payments on the Wachovia loan before repaying the        
borrowings associated with our Seattle communities. In the tables below the     
apartment communities are listed in the order in which we currently intend to   
repay the related affiliate line of credit borrowings. Under the terms of our   
affiliate line of credit, we must repay our borrowings related to any group of  
communities on a group basis, and not on a community-by-community basis. In any 
case we must repay all amounts due under our affiliate line of credit by        
January 1, 2007. Each time a portion of the outstanding balance of our affiliate
line of credit is repaid, our line-of-credit lender will release its lien on our
interests in the communities acquired with the proceeds of the repaid loan. Our 
affiliate line of credit is non-recourse to our Company, and there is no        
provision for cross-collateralization between communities which are no longer   
(or have not been) financed with our affiliate line of credit, and those that   
are still financed with it. If only approximately $29.5 million (not including  
any accrued interest on our affiliate line of credit or amounts distributed to  
stockholders from offering proceeds) is raised, and we cannot otherwise repay   
the balance of our affiliate line of credit, we will lose our interests in all  
but the Jacksonville communities.                                               

The Seattle apartment communities are also encumbered by approximately          
$7,987,418 of second mortgage debt as of December 31, 2005, from a third-party  
lender, which we will repay from the proceeds of this offering when we repay the
line-of-credit loans related to those communities. All of the apartment         
communities we have acquired interests in are further encumbered, as of December
31, 2005, by an aggregate of approximately $124,538,000 of permanent mortgage   
debt, which will not be repaid from the proceeds of this offering. All required 
debt payments have been made to date.                                           

As to our apartment communities which are no longer (or have not been) financed 
with our affiliate line of credit or any replacement line of credit, we do not  
currently intend to have total mortgage debt on those communities outside of the
targeted range of 55% to 65% but in any event not more than 70% of the gross    
asset value of those communities, though we have no limitations in our          
organizational documents regarding the amount of mortgage and other borrowings  
on our communities. The aggregate amount of our indebtedness outstanding at any 
time, however, may not exceed 300% of our net assets.                           

We will supplement or amend this prospectus from time to time when we have      
identified additional communities for acquisition.                              

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INFORMATION CONCERNING THE JACKSONVILLE COMMUNITIES 

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Name                Location          Number                                                Mortgage  Property        
of                  of                of                        Purchase     Permanent      Interest  Management      
Community           Property          Units   Monthly Rents(1)  Price(2)     Mortgage Loan  Rate      Agent           
---------           --------          -----   ----------------  --------     -------------  ----      -----           
                                                                                                                      
1.   Savannah Oaks  Jacksonville        228     $520 - 585 1BR  $11,498,227  $6,474,000     4.32%     Bainbridge      
     (formerly      Heights                     $700 - 760 2BR               Berkshire                Management      
     known as Oaks  (Jacksonville),                   $835 3BR               Mortgage                 Jacksonville LLC
     at             Florida                                                  Company(9)                               
     Timuquana)(8)                                                                                                    

2.   Bay Pointe(6)  Southside           300     $610 - 690 1BR  $17,815,831  $9,800,000     4.32%     Bainbridge      
                    (Jacksonville),             $720 - 745 2BR               Berkshire                Management      
                    Florida                                                  Mortgage                 Jacksonville LLC
                                                                             Company(7)                               

3.   Spicewood      East                512     $536 - 615 1BR  $30,579,666  $19,100,000    4.26%     Bainbridge      
     Springs(4)     (Jacksonville),             $725 - 845 2BR               Berkshire                Management      
                    Florida                                                  Mortgage                 Jacksonville LLC
                                                                             Company(5)                               


Nam                      Interim                                                                                      
of   Annual Property     BCP Funding                                                                                  
Com  Management Fee      Loan(3)                                                                                      
---  --------------      -------                                                                                      
                                                                                                                      
1.   3.5% of Gross        $ 5,087,352                                                                                 
     Income                                                                                                           
2.   3.5% of Gross        $ 8,125,565                                                                                 
     Income                                                                                                           
3.   3.5% of Gross        $11,741,148                                                                                 
     Income                                                                                                           

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

(1) Represents, as of December 31, 2005, rents offered, exclusive of utilities  
   and rent concessions of up to one month that may be offered occasionally on
select units, unless otherwise noted.                                   

(2) Including closing costs, funds escrowed to pay for renovations, and         
operating reserves.                                                     

(3) This debt will be paid in full from the offering proceeds.                  

(4) Spicewood Springs underwent a renovation and repositioning of the property  
in 2004, which is substantially complete.                               

(5) The principal amount of the mortgage as of December 31, 2005 was            
    $19,100,000, with a remaining term of approximately four years. The original
 mortgage loan is for a seven-year term with seven years at interest only.

(6) Bay Pointe underwent a renovation and repositioning of the property in 2004,
which is substantially complete. In addition to exterior improvements,  
greater than 50% of the 300 units were upgraded.                        

(7) The principal amount of the mortgage as of December 31, 2005 was $9,800,000,
with a remaining term of approximately four years. The original mortgage
loan is for a seven-year term with seven years at interest only.        

(8) Savannah Oaks underwent a renovation and repositioning of the property in   
   2004, which is substantially complete. Market rents are shown in this table
above.                                                                  

(9) The principal amount of the mortgage as of December 31, 2005 was $6,474,000,
with a remaining term of approximately four years. The original mortgage
loan is for a seven-year term with seven years at interest only.        

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INFORMATION CONCERNING THE PORTLAND AND SALT LAKE CITY COMMUNITIES

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Name                Location          Number                                                   Mortgage  Property       
of                  of                of                           Purchase     Permanent      Interest  Management     
Community           Property          Units      Monthly Rents(1)  Price(2)     Mortgage Loan  Rate      Agent          
---------           --------          -----      ----------------  --------     -------------  ----      -----          
                                                                                                                        
4.   Boulder Creek  Wilsonville         296              $585 1BR  $17,742,642  $11,375,000    4.52%     Pinnacle Realty
                    (Portland),                    $650 - 675 2BR               Berkshire                Management     
                    Oregon                               $855 3BR               Mortgage                 Company        
                                                                                Company(5)                              

5.   Bridge Creek   Wilsonville         315        $585 - 595 1BR  $20,242,177  $12,958,000    4.52%     Pinnacle Realty
                    (Portland),                    $680 - 690 2BR               Berkshire                Management     
                    Oregon                         $845 - 870 3BR               Mortgage                 Company        
                                                                                Company(6)                              

6.   Settler's      Taylorsville        416        $572 - 646 1BR  $23,396,250  $15,000,000    4.52%     Pinnacle Realty
     Point          (Salt Lake                     $645 - 744 2BR               Berkshire                Management     
                    City), Utah                                                 Mortgage                 Company        
                                                                                Company(7)                              


Nam                                     Interim                                                                         
of   Annual Property                    BCP Funding                                                                     
Com  Management Fee                     Loan(4)                                                                         
---  --------------                     -------                                                                         
                                                                                                                        
4.   4.0% of Gross Income (of which      $ 6,463,544                                                                    
     0.5% is payable after the Company                                                                                  
     has received the preferred return                                                                                  
     on its unreturned capital                                                                                          
     contributions). As of March 1,                                                                                     
     2005, we reduced the management                                                                                    
     fee to 3.5% of Gross Income until                                                                                  
     the property reaches certain                                                                                       
     performance hurdles.                                                                                               
5.   4.0% of Gross Income (of which      $ 7,412,489                                                                    
     0.5% is payable after the Company                                                                                  
     has received the preferred return                                                                                  
     on its unreturned capital                                                                                          
     contributions). As of March 1,                                                                                     
     2005, we reduced the management                                                                                    
     fee to 3.5% of Gross Income until                                                                                  
     the property reaches certain                                                                                       
     performance hurdles.                                                                                               
6.   4.0% of Gross Income (of which      $ 8,440,584                                                                    
     0.5% is payable after the Company                                                                                  
     has received the preferred return                                                                                  
     on its unreturned capital                                                                                          
     contributions)                                                                                                     

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

(1) Represents, as of December 31, 2005, current rents offered, exclusive of    
utilities and rent concessions of up to one month that may be offered   
occasionally on select units, unless otherwise indicated.               

(2) Including closing costs, funds escrowed to pay for renovations, and         
operating reserves.                                                     

(3) Under the terms of our LLC agreement with GFS Equity Management, Inc., we   
would have been responsible for 75% of the rate lock deposit fee in the 
    event the loan failed to close and GFS Equity Management LLC would have been
   responsible for 25%. We had a choice of accepting an interest rate of 4.60%
with a rate lock deposit that had more favorable refund terms than the  
alternative rate of 4.52%. In order to secure the lower rate and also to
    mitigate the risk of losing the rate lock deposit, GFS Equity Management LLC
    agreed to assume 100% of the risk of loss on the rate lock deposit in return
   for receiving 75% of the spread between the two interest rates (.06%). This
additional interest payment will be paid from cash flow to GFS Equity   
 Management LLC throughout the duration of the loan term contemporaneously
with the payments on the first mortgage loans.                          

(4) This debt will be repaid in full from the offering proceeds.                

(5) The principal amount of the mortgage as of December 31, 2005 was            
    $11,375,000, with a remaining term of approximately four years. The original
mortgage loan is for a 10-year term with seven years at a fixed interest
   rate at 4.52% and a floating rate for the last three years. During the last
  three years of the loan term, the loan term can be extended for five years
and a five-year fixed rate note can be executed.                        

(6) The principal amount of the mortgage as of December 31, 2005 was            
    $12,958,000, with a remaining term of approximately four years. The original
mortgage loan is for a 10-year term with seven years at a fixed interest
   rate at 4.52% and a floating rate for the last three years. During the last
  three years of the loan term, the loan term can be extended for five years
and a five-year fixed rate note can be executed.                        

(7) The principal amount of the mortgage as of December 31, 2005 was            
    $15,000,000, with a remaining term of approximately four years. The original
mortgage loan is for a 10-year term with seven years at a fixed interest
   rate at 4.52% and a floating rate for the last three years. During the last
  three years of the loan term, the loan term can be extended for five years
and a five-year fixed rate note can be executed.                        

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INFORMATION CONCERNING THE SEATTLE COMMUNITIES

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Name                Location          Number                                                                     Mortgage
of                  of                of                             Purchase     Permanent                      Interest
Community           Property          Units      Monthly Rents(1)    Price(2)     Mortgage Loan                  Rate    
---------           --------          -----      ----------------    --------     -------------                  ----    
                                                                                                                         
7.   Alderwood      Lynnwood            188          $665 - 685 1BR  $13,397,470  $9,210,000 Berkshire Mortgage  4.67%   
                    (Seattle),                       $775 - 835 2BR               Company(4)                             
                    Washington                                                    $1,951,084(5) Berkshire/WAFRA          
                                                                                  Mezzanine Debt Investors               
                                                                                  Foreign Fund                           
8.   Ridgetop       Silverdale          221                 $740 ST  $14,076,016  $9,690,000 Berkshire Mortgage  4.67%   
                    (Seattle),                       $740 - 800 1BR               Company(6)                             
                    Washington                       $850 - 955 2BR               $2,049,624(5) Berkshire/WAFRA          
                                                 $1,005 - 1,100 3BR               Mezzanine Debt Investors               
                                                                                  Foreign Fund                           
9.   Wellington     Silverdale          240          $765 - 820 1BR  $16,744,073  $11,530,000 Berkshire          4.67%   
                    (Seattle),                     $900 - 1,000 2BR               Mortgage Company(7)                    
                    Washington                   $1,075 - 1,100 3BR               $2,433,928(5) Berkshire/WAFRA          
                                                                                  Mezzanine Debt Investors               
                                                                                  Foreign Fund                           
10.  Ridgegate      Kent (Seattle),     153          $660 - 770 1BR  $10,786,486  $7,420,000 Berkshire Mortgage  4.67%   
                    Washington                       $840 - 900 2BR               Company(8)                             
                                                   $990 - 1,020 3BR               $1,566,780(5) Berkshire/WAFRA          
                                                                                  Mezzanine Debt Investors               
                                                                                  Foreign Fund                           


Nam  Property                               Interim                                                                      
of   Management         Annual Property     BCP Funding                                                                  
Com  Agent              Management Fee      Loan(3)                                                                      
---  -----              --------------      -------                                                                      
                                                                                                                         
7.   Pinnacle Realty    3.5% of Gross        $ 2,270,127                                                                 
     Management         Income                                                                                           
     Company                                                                                                             
8.   Pinnacle Realty    3.5% of Gross        $ 2,387,793                                                                 
     Management         Income                                                                                           
     Company                                                                                                             
9.   Pinnacle Realty    3.5% of Gross        $ 2,840,195                                                                 
     Management         Income                                                                                           
     Company                                                                                                             
10.  Pinnacle Realty    3.5% of Gross        $ 1,827,866                                                                 
     Management         Income                                                                                           
     Company                                                                                                             

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

(1) Represents, as of December 31, 2005, current rent offered, exclusive of     
utilities and rent concessions of up to one month that may be offered   
occasionally on select units, unless otherwise indicated.               

(2) Including closing costs, funds escrowed to pay for renovations, and         
operating reserves.                                                     

(3) This debt will be repaid in full from the offering proceeds.                

(4) The principal amount of the mortgage as of December 31, 2005 was $9,210,000,
    with a remaining term of approximately two years. The original mortgage loan
is for a 5-year term at interest only. Beginning in January 2008 we can 
 extend the loan for an additional five years and fix the interest rate at
170 basis points over the interest rate on a five-year Treasury Bill.   

(5) This is second mortgage debt incurred by BC-GFS LLC, a Delaware limited     
liability Company to acquire the Seattle communities. All of the second 
mortgage debt will be paid off from the offering proceeds. The second   
mortgage debt matures on December 31, 2007 at an interest rate of 12%.  

(6) The principal amount of the mortgage as of December 31, 2005 was $9,690,000,
    with a remaining term of approximately two years. The original mortgage loan
is for a 5-year term at interest only. Beginning in January 2008 we can 
 extend the loan for an additional five years and fix the interest rate at
170 basis points over the interest rate on a five-year Treasury Bill.   

(7) The principal amount of the mortgage as of December 31, 2005 was            
   $11,530,000, with a remaining term of approximately two years. The original
mortgage loan is for a 5-year term at interest only. Beginning in       
 January 2008 we can fix the interest rate for the remaining five years at
170 basis points over the interest rate on a five-year Treasury Bill.   

(8) The principal amount of the mortgage as of December 31, 2005 was $7,420,000,
    with a remaining term of approximately two years. The original mortgage loan
is for a 5-year term at interest only. Beginning in January 2008 we can 
 extend the loan for an additional five years and fix the interest rate at
170 basis points over the interest rate on a five-year Treasury Bill.   

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INFORMATION CONCERNING THE PLANO, TEXAS COMMUNITY 

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Name                     Location        Number                                                           Mortgage
of                       of              of         Monthly Rents      Purchase     Permanent             Interest
Community                Property        Units      at Closing(1)      Price(2)     Mortgage Loan         Rate    
---------                --------        -----      -------------      --------     -------------         ----    
                                                                                                                  
11.  Broadstone Preston  West (Plano),     229       $689 - 819 1BR    $17,731,348  $11,981,000 Deutsche  5.14%   
     at Willow Bend      Texas                      $859 - 1,099 2BR(3)             Bank Berkshire                
     Apartments                                                                     Mortgage, INC.(4)             
     (formerly known as                                                                                           
     Preston at Willow                                                                                            
     Bend Apartments)                                                                                             


                                          Interim                                                                 
                                          Wachovia Bank,                                                          
Nam  Property                             National                                                                
of   Management         Annual Property   Association                                                             
Com  Agent              Management Fee    Loan(5)                                                                 
---  -----              --------------    -------                                                                 
                                                                                                                  
11.  Alliance           3.5% of Gross     $5,556,348                                                              
     Residential, LLC   Income                                                                                    

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

(1) Represents, as of December 31, 2005, current rent offered exclusive of      
 utilities and rent concessions of up to one and one half months (or more)
that may be offered occasionally on select units, unless otherwise      
indicated.                                                              

(2) Including closing costs, funds escrowed to pay for renovations, and         
operating reserves.                                                     

(3) The Plano community is undergoing a $1,600,000 renovation and repositioning 
of the property. Upon completion the monthly rents are projected to be  
$754-943 on 1BR and $962-1,165 on 2BR.                                  

(4) Originally, we obtained a mortgage bridge loan from Deutsche Bank Berkshire 
Mortgage, Inc. The principal amount of the mortgage bridge loan as of   
September 21, 2005 was $12,000,000. The mortgage loan bridge loan had a 
sixty-day term and an interest rate of one month LIBOR plus 100 basis   
  points. We obtained a permanent mortgage loan of $11,981,000 with Deutsche
  Bank Berkshire Mortgage, Inc. as lender on October 25, 2005. The permanent
mortgage loan has a fixed interest rate of 5.14%. The permanent mortgage
  loan is for a nine-year term with nine years at interest only. The $19,000
   difference between the mortgage bridge loan and the permanent mortgage loan
was funded through funds in the property operating account.             

(5) To fund a portion of the purchase price, we borrowed $5,556,348 from        
Wachovia Bank, National Association. The interest on the loan accrues in
    arrears at an interest rate of, at our election, LIBOR plus 300 basis points
    per annum or Wachovia Bank, National Association's announced prime rate plus
    150 basis points per annum and is due and payable monthly to the extent that
distributions are received from us by BC Broadstone Preston, LP (a joint
venture in which we have a controlling interest), and, to the extent the
interest is not paid, will be added to principal. The loan matures on   
July 3, 2006 and is pre-payable at any time without fee subject to LIBOR
breakage costs. We may extend the maturity date for an additional period
  through January 1, 2007 provided no default or event of default shall then
  be in existence under the loan agreement; we pay an extension fee equal to
  42 basis points of the outstanding balance of the loan as of July 3, 2006;
    and we provide written notice to Wachovia of our request for an extension of
the maturity date no later than June 3, 2006.                           

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JACKSONVILLE, FLORIDA COMMUNITIES 

We own fee simple interests in three apartment communities in Jacksonville,     
Florida-Spicewood Springs, Bay Pointe and Savannah Oaks formerly known as Oaks  
at Timuquana. To acquire these interests, we borrowed approximately $25,000,000 
under our affiliate line of credit. This amount includes the equity required to 
purchase the properties, initial capital requirements for planned renovations,  
establishment of operating reserves and costs associated with our affiliate line
of credit, with respect to the transaction. In addition, the Jacksonville       
communities are encumbered with $35,374,000 of first mortgage debt as of        
December 31, 2005. We will repay the outstanding portion of our affiliate line  
of credit attributable to these communities from the proceeds of this offering. 
The outstanding mortgage indebtedness on the Jacksonville communities will not  
be repaid with the proceeds of this offering, and will continue to encumber the 
communities in accordance with the terms of the mortgage loans.                 

We acquired our interests in the Jacksonville communities by forming a wholly   
owned subsidiary, BCMR Jacksonville, LLC, to acquire a controlling member       
interest in BC-Bainbridge LLC. We paid $24,409,639 for our interest.            
BC-Bainbridge LLC owns legal fee simple title to the communities through three  
wholly owned subsidiaries. The manager of BC-Bainbridge LLC is Bainbridge       
Jacksonville LLC, a third party which is not affiliated with us or our advisor. 
Bainbridge Jacksonville LLC must obtain the consent of BCMR Jacksonville, LLC   
before it can make material decisions and it can be replaced by BCMR            
Jacksonville, LLC at any time.                                                  

Bainbridge Jacksonville LLC is entitled to participate in the cash distributions
of the Jacksonville communities after we (the REIT) have received a priority    
share of the cash flow. Before Bainbridge Jacksonville LLC receives any portion 
of the cash flow, we will receive:                                              

(i)  $50 annually per apartment unit (a total of 1040 units times $50 equals    
$52,000 annually); and                                                  

(ii) a 12% preferred return on our unreturned capital contribution (which       
initially was $24,409,639).                                             

To the extent we receive this priority share of the cash flow, it will be used  
to pay our ordinary expenses, including operational-stage fees and reimbursement
to our advisor and affiliates. After payment of such expenses, the priority cash
flow would be available for distribution to stockholders. There is no guarantee 
that there will be sufficient priority cash flow to make any distributions to   
stockholders. We will then share 50/50 with Bainbridge Jacksonville LLC in all  
remaining income from operations of our Jacksonville communities. Proceeds from 
the sale of any of our Jacksonville communities will first be distributed to pay
us a 1% sales                                                                   

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analysis fee, and then to pay us any unpaid asset management fees and preferred 
return.                                                                         

Remaining sale proceeds will be distributed to us until we have received a      
return of our capital contributions (taking into account prior distributions)   
plus a 16% per annum rate of return on our capital contributions. We will then  
receive 93.75% (of which an affiliate of Bainbridge Jacksonville LLC will       
receive 20% as an advisory fee) and Bainbridge Jacksonville LLC will receive    
6.25% of any remaining sale proceeds. There is no guarantee that any preferred  
return will be sufficient for us to make any distribution to stockholders. We   
believe that this arrangement is an appropriate incentive to encourage          
performance by Bainbridge Jacksonville LLC. We can remove Bainbridge            
Jacksonville LLC without cause at any time.                                     

An acquisition fee of $470,908 (1.60% of the offering proceeds related to our   
Jacksonville communities of approximately $25 million) and acquisition expenses 
of $73,519 (0.25% of the offering proceeds related to our Jacksonville          
communities) were paid to an affiliate of our advisor. The prepaid acquisition  
fees and expense reimbursements will be deducted from the 2.70% acquisition fee 
and 0.5% acquisition expense reimbursement we have agreed to pay to our advisor 
with respect to our Jacksonville communities.                                   

Savannah Oaks Apartments
(Formerly Known as Oaks at Timuquana Apartments)

Savannah Oaks Apartments is an existing multifamily apartment complex consisting
of 228 units located in suburban Jacksonville, Florida. The community consists  
of 22 two-story buildings on a landscaped setting and includes the following    
interior amenities: central air conditioning, dishwasher, frost free            
refrigerator, electric stove/oven, garbage disposal, kitchen pantry,            
wall-to-wall carpet, patios/balconies, cable access, walk-in closets and storage
closet. Exterior amenities include: two swimming pools, BBQ/picnic area,        
resident lounge, child's playground and perimeter fencing. There are 96         
one-bedroom units, 88 two-bedroom units and 44 three-bedroom units. The         
apartment units have an average size of 921 square feet. The community was      
constructed in 1971.                                                            

The purchase price for the community was $11,498,227, paid as follows:          
(i) $7,690,000 to the unaffiliated seller of the property; (ii) $ 157,400 in    
customary closing costs; (iii) $292,650 in origination and financing fees and   
expenses; (iv) $738,738 prepayment penalty to former mortgage holder; and       
(v) $2,619,439 in renovation costs, operating reserves, and preferred return    
reserves. The major reason why the closing costs for this community (exclusive  
of reserves and renovation costs) are approximately 10% of the purchase price,  
is because of the large prepayment penalty paid to the former unaffiliated      
mortgage holder. The closing occurred on                                        

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May 22, 2003, and the purchase price was funded by a combination of first       
mortgage debt and borrowings on our affiliate line of credit. The independently 
appraised value of the community as renovated and stabilized at the time of     
closing was $9,640,000. With current first mortgage debt in the principal amount
of $6,474,000, the community's loan-to-value ratio is 67.17%. We will only be   
liable to the community and its creditors up to the amount of our initial       
capital in the community.                                                       

The property management agent is Bainbridge Management Jacksonville LLC, which  
is affiliated with Bainbridge Jacksonville LLC. Bainbridge has managed the      
community since its acquisition and receives a property management fee equal to 
3.5% of gross income. Bainbridge does not manage communities not owned by us    
that compete with our communities in the Jacksonville market.                   

The renovation included unit upgrades including repairs to kitchen and bathroom 
cabinets and countertops in 158 of the units, and the installation of stackable 
washer/dryer in some units. All apartments were painted; carpet and flooring was
replaced as necessary. It also included site landscaping and lighting, roof and 
decking repairs or replacements, patio and balcony repairs, deck and stairway   
repairs, stucco and siding repairs, and repairs to the pool and decking.        

A preferred return reserve funded from the proceeds of the purchase price was   
used to supplement the income of the community sufficient for us to make        
distributions to investors in accordance with our investment objectives.        

After completion of the renovations, the physical condition of the community was
sufficiently enhanced to allow us to obtain higher rents. All of the leased     
space is residential with leases ranging from an initial term of six months to  
one year. The average historical occupancy rate for the last five years is as   
follows:                                                                        

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         92%               90%           91%           87%           92%     

Approximately 17 units (7.46% of total units) on average were under renovation  
during 2004 and not available for lease. As of December 31, 2005, the occupancy 
rate was approximately 90%.                                                     

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005   
   ----               ----          ----          ----          ----   
                                                                       
$6,283/unit       $6,584/unit   $7,164/unit   $7,029/unit   $7,475/unit

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As shown above, Savannah Oaks's occupancy has varied over the past few years.   
Prior to 2001 there was weak demand in the Jacksonville Heights submarket;      
however, since then, occupancy has stabilized and rental rates have increased.  
The property was purchased with a plan to renovate and reposition it and now    
that the renovation is complete, the annual rental rate per unit increased in   
2005.                                                                           

The community is located in the Jacksonville Heights submarket of Jacksonville, 
Florida, an area which has historically had low residential vacancy rates       
(averaging 4.4% in 2005). The greater Jacksonville area had a median income of  
$60,300 as of 2006 according to the U.S. Department of Housing and Urban        
Development (HUD).                                                              

- Savannah Oaks Apartments are located on Roosevelt Blvd. The neighborhood is a 
mixture of older multifamily developments, a wide range of commercial-retail
and single-family subdivisions. Immediately north along Roosevelt Blvd. are 
located several restaurants and some light retail. The area is a mixture of 
light commercial real estate and mature single-family homes. Roosevelt Blvd.
 runs north alongside U.S. Highway 17 and State Route 15. Immediately south of
the site on Allegheny Rd. is a single-family home neighborhood in good      
condition. Southeast of the subject, three quarters of a mile, is the       
 Jacksonville Naval Air Station. Allegheny Rd. is located adjacent to the site
on the east and is the main access to the property. Further east of the     
  property are mature single-family homes, some apartment complexes, open space,
and a municipal golf course. To the west across U.S. Highway 17 and State   
Route 15 is some light retail, a restaurant, and automotive repair shop.    
Further west is open space and a water inlet to the St. John's River.       

- On State Route 21, two and one-half miles southwest from the Savannah Oaks, is
  Planters Walk. Built in 1970, the 217-unit property has a similar unit mix and
range of unit sizes. Approximately three and one-half miles southwest of the
Savannah Oaks are three comparable properties which are slightly superior.  
  These properties are located along the Interstate 295 beltway and are noted as
follows as: The Waterford at Orange Park, with 280 apartments built in 1986,
Wellington Place, with 358 units built in 1987, and Westland Park, with 405 
units built in 1989. The following properties are all located two to five   
miles to the north of the Savannah Oaks and were considered to be comparable
to its condition at the time of acquisition: Colonial Forest, a 174-unit    
building built in 1970, Gregory West a 162-unit building built in 1972, The 
  Preserve at Cedar River a 464-unit building built in 1973, and Mission Springs
a 444-unit building built in 1973. All of these properties have similar     
 amenities to those at the Savannah Oaks, and some share a common attribute of
multifamily developments in the area; park-like settings.                   

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To continue to compete well with these properties, management implemented an    
aggressive marketing campaign and we have substantially completed the           
renovations, which increased the exterior curb appeal and provided significant  
interior upgrades to a portion of the apartment units. This strategy along with 
the strong demand for multifamily housing should keep Savannah Oaks competitive 
in the market.                                                                  

Bay Pointe Apartments 

Bay Pointe Apartments is an existing multifamily apartment complex consisting of
300 units located in suburban Jacksonville, Florida. The community consists of  
15 two-story buildings on a landscaped setting and includes the following       
interior amenities: central air conditioning, dishwasher, frost-free            
refrigerator, electric stove/oven, garbage disposal, kitchen pantry,            
wall-to-wall carpet, patios/balconies, cable access, walk-in closets and storage
closet. Exterior amenities include: swimming pool, BBQ/picnic area, resident    
lounge, tennis courts, volleyball court, child's playground and perimeter       
fencing. There are 120 one-bedroom units and 180 two-bedroom units. The         
apartment units have an average size of 971 square feet. This community was     
constructed in 1974.                                                            

The purchase price for the community was $17,815,831, paid as follows:          
(i) $11,690,000 to the unaffiliated seller of the property; (ii) $673,529 in    
customary closing costs; and (iii) $5,452,302 in renovation costs, operating    
reserves, and preferred return reserves. The closing occurred on May 22, 2003,  
and the purchase price was funded by a combination of first mortgage debt and   
borrowings on our affiliate line of credit. The independently appraised value of
the community at the time of closing was $14,200,000. With current first        
mortgage debt in the principal amount of $9,800,000, the community's            
loan-to-value ratio is 69.01%. We will only be liable to the community and its  
creditors up to the amount of our initial capital in the community.             

The property management agent is Bainbridge Management Jacksonville LLC, which  
is affiliated with Bainbridge Jacksonville LLC. Bainbridge has managed the      
community since its acquisition and receives a property management fee equal to 
3.5% of gross income. Bainbridge does not manage communities not owned by us    
that compete with our communities in the Jacksonville market.                   

Through our renovation plan we substantially upgraded in excess of 50% of the   
apartments, including new kitchen and bathroom cabinets and countertops, and the
installation of stackable washer/dryer units and new appliances in many of the  
units. All apartments were painted; carpet and flooring was replaced as         
necessary. The renovation also includes site landscaping, sidewalk repairs, new 
playground equipment, repairs to the pool                                       

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and decking, dumpster enclosures, exterior upgrades to the leasing center,      
installation of vinyl siding and trim over existing siding, termite repairs, and
roof and decking repairs.                                                       

A preferred return reserve funded from the proceeds of the purchase price was   
used to supplement the income of the community sufficient for us to make        
distributions to investors in accordance with our investment objectives.        

After completion of the renovations, the physical condition of the community was
sufficiently enhanced to allow us to obtain higher rents. All of the leased     
space is residential with leases ranging from an initial term of six months to  
one year. The average historical occupancy rate for the last five years is as   
follows:                                                                        

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         94%               90%           91%           81%           96%     

Approximately 35 units (11.7% of total units) on average were under renovation  
during 2004 and not available for lease. As of December 31, 2005, the occupancy 
rate was approximately 93%.                                                     

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005   
   ----               ----          ----          ----          ----   
                                                                       
$6,365/unit       $6,615/unit   $6,939/unit   $7,314/unit   $7,843/unit

As shown above, the effective annual rental rate has grown at a steady pace over
the past few years. Vacancy increased slightly in 2002 due to a weakening in the
national economy and lower interest rates, which enabled more potential tenants 
to move into single family homes, leading to a slight weakening in the local    
multifamily apartment market. The effective annual rental rate grew slightly,   
however, which should lead to higher revenue when the market recovers, which    
appears to be occurring based on current occupancy rates and increase in rents. 
In addition, the property was purchased with a plan to renovate and reposition  
it. Now that the renovation of the property is completed, the annual rental rate
per unit is expected to increase further.                                       

The community is located in the Southside submarket of Jacksonville, Florida, an
area which has historically had low residential vacancy rates (averaging 3.3% in
2005). The greater Jacksonville area had a median income of $60,300 as of 2006  
according to HUD.                                                               

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- The Bay Pointe Apartments are located on Baymeadows Rd. approximately one and 
a quarter miles west from Highway 1. The neighborhood is a mixture of mature
  multifamily developments, a wide range of commercial-retail, and single-family
subdivisions. Immediately north across Baymeadows Rd. are recently built    
 office condos with dentists and other professional tenants. Immediately south
of the site is Graven Rd. and a single-family home neighborhood in good     
condition. Adjacent to the site on the east is a retention pond. East of the
pond is Baymeadows Baptist Day School and Kindergarten. Further east along  
Baymeadows Rd. are single-family homes, small strip malls with restaurants, 
banks and personal services all in very good condition. Adjacent to the site
  on the west is another retention pond. West of the pond is the intersection of
Graven Rd. and Baymeadows Rd. and the Beauclerc Elementary School.          

- On Princeton Square Blvd. East, directly east from Bay Pointe, is Princeton   
  Square Apartments. Built in 1983, the 288-unit property has a similar unit mix
 and range of unit sizes. About one block south of Princeton Square is Bentley
Green Apartments, with 444 apartments built in 1986. Approximately one mile 
  northeast from Bentley Green Apartments, on Southside Blvd., is the Reserve at
Deerwood, a 226-unit community built in 1980 and renovated in 1997. About   
 three and one-half miles north of the Reserve at Deerwood is The Antlers with
400 units built in 1986. All of these properties have similar amenities to  
those at Bay Pointe and share a common attribute of multifamily developments
in the area, mature landscaping and park-like settings. The Antlers and     
Bentley Green Apartments recently underwent significant renovations and     
reflect the anticipated comparable end result projected for Bay Pointe      
Apartments upon completion of its respective rehabilitation.                

To continue to compete well with these properties, management implemented an    
aggressive marketing campaign and we have substantially completed renovations,  
which increased the exterior curb appeal and provided significant interior      
upgrades to a portion of the apartment units. This strategy along with the      
strong demand for multifamily housing should keep Bay Pointe competitive in the 
market.                                                                         

Spicewood Springs Apartments

Spicewood Springs Apartments is an existing multifamily apartment complex       
consisting of 512 units located in suburban Jacksonville, Florida. The community
consists of 26 two-story and three-story buildings on a landscaped setting and  
includes the following interior amenities: central air conditioning, dishwasher,
frost-free refrigerator, electric stove/oven, garbage disposal, ceiling fans,   
kitchen pantry, wall-to-wall carpeting, walk-in                                 

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closets, patios/balconies, cable access, high speed internet access, storage    
closet and some units contain wood-burning fire places. The development also    
includes the following exterior amenities: 2 swimming pools, BBQ/ picnic area,  
resident lounge, resident kitchen, fitness center, tennis courts, controlled    
gated access and perimeter fencing. There are 328 one-bedroom units and 184     
two-bedroom units. The apartment units have an average size of 759 square feet. 
The community was constructed in two phases; phase I in 1985 and phase II in    
1987.                                                                           

The purchase price for the community was $30,579,666, paid as follows:          
(i) $28,000,000 to the unaffiliated seller; (ii) $1,007,669 in customary closing
costs; and (iii) $1,571,997 for renovation costs, operating reserves, and       
preferred return reserves. The closing occurred on May 29, 2003, and the        
purchase price was funded by a combination of first mortgage debt and borrowings
on our credit line. The independently appraised value of the community at the   
time of closing was $29,400,000. With current first mortgage debt in the        
principal amount of $19,100,000, the community's loan-to-value ratio is 65%. We 
will only be liable to the community and its creditors up to the amount of our  
initial capital in the community.                                               

The property management agent is Bainbridge Management Jacksonville LLC, which  
is affiliated with Bainbridge Jacksonville LLC. Bainbridge has managed the      
community since its acquisition and receives a property management fee equal to 
3.5% of gross income. Bainbridge does not manage communities not owned by us    
that compete with our communities in the Jacksonville market.                   

In 2004 a renovation of the property was completed and included site            
landscaping, perimeter fencing repairs and upgrades, upgrades to leasing center 
and fitness center, exterior painting, repairs to breezeway stairs and          
handrails, general siding repairs, termite repairs, minor roof repairs, HVAC,   
and plumbing and electrical repairs.                                            

A preferred return reserve funded from the proceeds of the purchase price was   
used to supplement the income of the community sufficient for us to make        
distributions to investors in accordance with our investment objectives.        

All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         92%               92%           92%           91%           94%     

As of December 31, 2005, the occupancy rate was 94%.                            

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The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005   
   ----               ----          ----          ----          ----   
                                                                       
$6,992/unit       $6,912/unit   $7,316/unit   $7,161/unit   $7,294/unit

As shown above, the effective annual rental rate has grown at a steady pace over
the past few years other than in 2002 and 2004. The dip in 2002 occurred when   
the local multifamily apartment market weakened due to a weakening in the       
national economy and lower interest rates, which enabled more potential tenants 
to move into single family homes, resulting in a need to offer rent concessions 
in order to maintain the occupancy rate. In 2004, while the property was        
undergoing renovations, market rents were slightly reduced to ensure higher     
occupancy. The property was purchased with a plan to renovate and reposition it 
and it is management's belief that, as the national economy and the local       
multifamily apartment market strengthens, which appears to be occurring based on
current occupancy rates, and the renovation and repositioning of the property is
completed, the annual rental rate per unit will increase.                       

In February 2005, there was a fire in one of the apartment buildings consisting 
of twenty-four one-bedroom units. The fire damaged six of the 512 units and     
resulted in the death of one tenant. Three of the units incurred only minor     
damage and were placed in service within six weeks. The other three units were  
placed in service on September 21, 2005. Property insurance is expected to cover
the total cost of repairs less the $25,000 deductible, and rental loss insurance
is expected to cover income losses from the damaged units. The 2004 renovation  
and repositioning of the property addressed deferred maintenance, including     
exterior painting. None of these improvements were impacted by the fire.        

The community is located in the East Jacksonville submarket of Jacksonville,    
Florida, an area which has historically had low residential vacancy rates       
(averaging 3.5% in 2005). The greater Jacksonville area had a median income of  
$60,300 as of 2006 according to HUD.                                            

- The Spicewood Springs Apartments are located on 445 Monument Rd., at the      
intersection of Regency Square Blvd. and Monument Rd. The neighborhood is a 
 mixture of mature multifamily developments, a wide range of commercial-retail
properties and single-family home subdivisions. Proceeding north on Monument
 Rd. are mature multifamily properties in good condition, single-family homes,
open land and the entrance to State Route 9. Immediately south of the site  
 along Monument Rd. are multifamily properties in good condition, the entrance
to the one million square foot Regency Square Mall and the entrance to State
Route 10. Across Monument Rd. to the east is open space and                 

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 single-family home subdivisions along Lee Rd. Across Monument Rd. to the west
  is open space, single-family homes and within four miles, the St. Johns River.
In addition, the entrance to State Route 113 is located approximately 500   
yards from the subject along Regency Square Blvd.                           

- On Monument Rd., directly north and adjacent to Spicewood Springs Apartments, 
are the Oaks at Mill Creek Apartments. Constructed in 1987, this 360-unit   
 property is similar to Spicewood Springs Apartments in terms of both unit mix
and unit size. About one mile south of the Oaks at Mill Creek Apartments is 
Regency Place Apartments, consisting of 120 apartments that were constructed
in 1996. One mile southwest from Regency Place Apartments, on Beacon Point  
Drive, is The Waterford at Regency Apartments, a 159-unit community that was
constructed in 1985. About one and one-half miles north of Spicewood Springs
Apartments is Paddock Club Apartments, consisting of 440 units that were    
constructed in 1990. All of these properties have similar amenities to those
found at Spicewood Springs Apartments, and many share a common attribute of 
multifamily developments in the area, mature landscaping and park-like      
settings.                                                                   

To continue to compete well with these properties, management has implemented an
aggressive marketing campaign. We have also substantially completed renovations,
which has increased exterior curb appeal and provided upgrades to a portion of  
theinterior of the apartment units. This strategy along with the strong demand  
for multifamily housing should keep Spicewood Springs competitive in the market.

PORTLAND, OREGON and SALT LAKE CITY, UTAH COMMUNITIES 

We own interests in two apartment communities in Portland, Oregon, and one      
apartment community in Salt Lake City, Utah. The Portland, Oregon, communities  
are Boulder Creek and Bridge Creek, and the Salt Lake City, Utah, community is  
Settler's Point. To acquire these interests, we borrowed approximately          
$22,300,000 under our affiliate line of credit. This amount includes the capital
contributions required to purchase the properties, initial capital requirements 
for planned renovations, establishment of operating reserves and costs          
associated with our affiliate line of credit with respect to this transaction.  
In addition, the Portland and Salt Lake City communities are encumbered with    
$39,333,000 of first mortgage debt as of December 31, 2005. We will repay the   
outstanding portion of our affiliate line of credit attributable to these       
communities from the proceeds of this offering. The outstanding mortgage        
indebtedness on these communities will not be repaid with the proceeds of this  
offering, and will continue to encumber the communities in accordance with the  
terms of the mortgage loans.                                                    

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We acquired our interests in the Portland and Salt Lake City communities by     
forming a wholly owned subsidiary, BCMR Portland, LLC, to acquire a controlling 
member interest in BC-GFS-II LLC. We paid $21,829,724 for our interest, which is
comprised of two classes, Class A ($9,364,951.60 ) and Class B ($12,464,772.40).
The Class B contribution is treated as mezzanine financing. We receive a        
preferred return of 11% on both capital contributions; however, the 16%         
preferred return at sale is calculated only on the Class A contribution.        
BC-GFS-II LLC owns legal fee simple title to the communities through three      
wholly owned subsidiaries. The manager of BC-GFS-II LLC is GFS Equity Management
LLC, a third party which is not affiliated with us or our advisor. GFS Equity   
Management LLC must obtain the consent of BCMR Portland, LLC before it can make 
material decisions, and it can be replaced by BCMR Portland, LLC at any time.   

During the terms of the current first mortgage loans on the Portland and Salt   
Lake City communities, GFC Equity Management LLC is entitled to be paid 0.06%   
per annum of the principal of the first mortgage loans from the cash flow of    
BC-GFS-II LLC as compensation for its agreement to assume 100% of the risk of   
loss on the rate lock deposit on the first mortgage debt paid to the first      
mortgage holder. Initially, the unaffiliated permanent mortgage lender agreed to
provide mortgage lending for the Portland and Salt Lake City communities at a   
rate of 4.6% or 4.52%. A rate lock deposit fee of approximately $786,000 was    
required for either of the rate caps. If the 4.6% rate was locked and we did not
close on the loan, most of the rate lock deposit fee would have been refunded.  
However, if the 4.52% rate was locked and we did not close on the loan, all of  
the rate lock deposit fee would not have been refunded. We wanted to lock in at 
the lowest rate possible. In order to secure the lower rate and also to mitigate
the risk of losing the rate lock deposit, GFS Equity Management LLC agreed to   
assume 100% of any rate lock deposit fee not refunded in return for receiving   
75% of the spread between the two interest rates (0.06% (0.08% X 75%)), or      
approximately $23,600. This additional interest payment of 0.06% per annum to   
GFS Equity Management LLC will be paid from cash flow throughout the duration of
the permanent mortgage loans and is expected to be approximately $23,600        
annually until maturity in June 2010.                                           

GFS Equity Management, LLC is entitled to participate in cash distributions of  
the Portland and Salt Lake City communities after Boston Capital REIT has       
received a priority share of the cash flow. Before GFS Equity Management LLC    
receives any portion of the cash flow, we will receive:                         

(i)  $50 annually per apartment unit (a total of 1027 units times $50 equals    
$51,350 annually); and                                                  

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(ii) a 11% preferred return on our unreturned capital contributions (which      
initially was $21,829,724).                                             

To the extent we receive this priority share of the cash flow, it will be used  
to pay our ordinary expenses, including operational-stage fees and reimbursement
of our advisor and affiliates. After payment of such expenses, the priority cash
flow would be available for distribution to stockholders. There is no guarantee 
that there will be sufficient priority cash flow to make any distributions to   
stockholders.                                                                   

The property management agent will receive 0.5% of gross income as a portion of 
its total property management fee. We will then share 50/50 with GFS Equity     
Management LLC in all remaining income from operations of the Portland and Salt 
Lake City communities. Proceeds from the sale of any of the Portland or Salt    
Lake City communities will first be distributed to pay us any unpaid preferred  
return. Remaining sale proceeds will be distributed to us until we have received
a return of our capital contributions (taking into account prior distributions) 
plus a 16% per annum rate of return on our Class A capital contributions. We    
will receive 75% and GFS Equity Management LLC will received 25% of any         
remaining sale proceeds. There is no guarantee that any preferred return will be
sufficient for us to make any distribution to stockholders. We believe that this
arrangement is an appropriate incentive to encourage performance by GFS Equity  
Management LLC. We can remove GFS Equity Management LLC without cause at any    
time.                                                                           

An acquisition fee of $421,142 (1.63% of the offering proceeds related to these 
communities of approximately $22 million) and acquisition expenses of $65,751   
(0.25% of the offering proceeds related to the Portland/Salt Lake communities)  
were paid to an affiliate of our advisor. The prepaid acquisition fees and      
expense reimbursements will be deducted from the 2.70% acquisition fee and 0.5% 
acquisition expense reimbursement we have agreed to pay to our advisor with     
respect to these communities.                                                   

Boulder Creek Apartments

Boulder Creek Apartments is an existing multifamily apartment complex consisting
of 296 units located in suburban Portland, Oregon. The community consists of 21 
two and three-story buildings on a landscaped setting and includes the following
interior amenities: dishwasher, frost free refrigerator, electric stove/oven,   
garbage disposal, ceiling fans, wall-to-wall carpet in living areas, walk-in    
closets, patios/balconies, vaulted ceilings, cable access, high speed internet  
access, washer/dryer connections, side by side washer/dryer furnished and       
storage closet. The development also includes the following exterior amenities: 
carports, garages, swimming pool, resident lounge, resident kitchen, and fitness
center. There are 71                                                            

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one-bedroom units, 49 two-bedroom/one-bath units, 128 two-bedroom/ two-bath     
units and 48 three-bedroom units. The apartment units have an average size of   
850 square feet. The community was constructed in two phases in 1988 and 1990.  

The purchase price for the community was $17,742,642, paid as follows:          
(i) $16,700,000 to the unaffiliated seller of the property; (ii) $579,555 in    
customary closing costs; and (iii) $463,087 in renovation costs and operating   
reserves. The closing occurred on May 30, 2003, and the purchase price was      
funded by a combination of first mortgage debt and borrowings on our affiliate  
line of credit. The independently appraised value of the community at the time  
of closing was $18,230,000. With current first mortgage debt in the principal   
amount of $11,375,000, the community's loan-to-value ratio is 62.40%. We will   
only be liable to the community and its creditors up to the amount of our       
initial capital in the community.                                               

The property management agent is Pinnacle Realty Management Company, which is   
affiliated with GFS Equity Management LLC. Pinnacle has managed the community   
since its acquisition and until March 1, 2005, received a property management   
fee equal to 4.0% of gross income (of which 0.5% was payable after the Company  
had received the preferred return on its unreturned capital contributions). As  
of March 1, 2005, we reduced the management fee to 3.5% of gross income until   
the property reaches certain performance hurdles. Pinnacle also manages Boulder 
Creek's sister community Bridge Creek as well as one other property in the      
immediate submarket not owned by us. That property has fewer but larger units   
than Boulder Creek and Bridge Creek and is not considered direct competition to 
these communities. Boulder Creek and Bridge Creek do compete with each other.   
However, the communities refer business to each other to provide the best       
service possible to potential tenants and to optimize occupancy at both         
communities.                                                                    

Renovations on the property including repairs to guardrails and balcony decking,
repairs to bathroom exhaust ducting, replacement of some carpet, flooring,      
appliances, and countertops, and treatment of termites have been completed. An  
operating reserve funded from the proceeds of the purchase price was used to    
supplement the income of the community sufficient for us to make distributions  
to investors in accordance with our investment objectives.                      

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All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         94%               91%           91%           88%           91%     

As of December 31, 2005, the occupancy rate was approximately 97%.              

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005   
   ----               ----          ----          ----          ----   
                                                                       
$7,722/unit       $7,490/unit   $7,164/unit   $7,184/unit   $7,207/unit

In 2002, the local real estate market weakened, resulting in both an increase in
the property's vacancy rate and a need to offer rent concessions. The property  
was purchased based on the market conditions that were present in 2002. The     
market did not strengthen in 2003 or 2004. The property was purchased with a    
plan to renovate and reposition it and it is management's belief that, as the   
local real estate market strengthens, concessions will come to an end, the      
annual rental rates will increase and vacancy will decrease.                    

The community is located in Wilsonville, Clackamas County, Oregon, approximately
17 miles south of downtown Portland and 25 miles north of the state capital.    
This area had an average residential vacancy of 6.1% in 2005. The greater       
Portland area had a median income of $67,900 as of 2006 according to HUD.       

- The immediate neighborhood is a mixture of early to mid-1990's multifamily    
developments, single-family subdivisions, neighborhood retail, service      
stations and public schools. Directly north is a single-family residential  
subdivision. Directly south of the property is Boeckman Creek Primary School
  and Wilsonville High School. Wooded land and farmland is east of the property,
  which is located outside the Urban Growth Boundary. To the west is Wilsonville
Road and across the street is a single-family subdivision. A competing      
apartment complex is located across Wilsonville Road to the southwest.      

- Boulder Creek's sister property, Bridge Creek, is located about one-half mile 
southwest. It is a 315-unit property, built in three phases between 1988 and
1990. Bridge Creek has a similar apartment mix but does not offer 2BR/1BA   
 floor plans. It offers a similar range in unit size, and comparable amenities
to those at Boulder Creek. Berkshire Court is                               

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located on Wilsonville Road across from the subject. It is a 266-unit       
  community constructed in 1996. Berkshire Court is identical in the floor plans
 but has more 2BR/1BA units than Boulder Creek and has comparable amenities to
those offered at Boulder Creek. Hathaway Court is located across Wilsonville
  Road from the subject and is a 298-unit community constructed between 1997 and
  1998. Hathaway Court is identical in the floor plans to both Boulder Creek and
Berkshire Court but has more 2BR/1BA units than Boulder Creek and offers    
comparable amenities. Town Center Park is located approximately one mile    
southwest of the Boulder Creek Apartments. Town Center Park, which was built
  in 1991, is comprised of 111 units with much larger floor plans and no 2BR/1BA
models. Town Center Park offers similar amenities but is more conveniently  
located to shopping and services. Sundial Apartments, with 120 units, is    
located approximately one and a quarter miles northwest of Boulder Creek.   
Sundial was built in 1991 and offers an inferior amenity package. Sundial's 
apartments are smaller than those at Boulder Creek and it does not offer    
2BR/1BA units.                                                              

Boulder Creek is expected to continue to compete successfully in its market.    
Located in Clackamas County with an attractive quality of life, the Wilsonville 
area offers affordable living, convenient shopping, good schools and ready      
access to neighborhood employment. Although the economy of the region has been  
fairly diversified, economic events over the last couple of years have taken    
their toll on local employment although much less than on the rest of the       
Portland area. Oregon's managed growth policy has moderated large swings in     
rental housing supply that typically accompany economic fluctuations. While low 
interest rates have impacted the rental community as a whole with a migration to
homeownership, the effect on Boulder Creek appears to have been minimal. Boulder
Creek offers social and recreational amenities equivalent to those at comparable
properties.                                                                     

Bridge Creek Apartments 

Bridge Creek Apartments is an existing multifamily apartment complex consisting 
of 315 units located in suburban Portland, Oregon. The community consists of 28 
two and three-story buildings on a landscaped setting and includes the following
interior amenities: dishwasher, frost-free refrigerator, electric stove/oven,   
garbage disposal, wood burning fireplace, ceiling fans, wall-to-wall carpet,    
patios/balconies, cable access, high speed internet access, washer/dryer        
connections, washer/dryer furnished, and storage closet. Exterior amenities     
include: carports, garages, outdoor spa, 2 outdoor swimming pools, resident     
lounge, resident kitchen, fitness center, child's playground and perimeter      
fencing. There are 80 one-bedroom units, 183 two-bedroom units and 52           
three-bedroom units.                                                            

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The apartment units have an average size of 870 square feet. This community was 
constructed in 1988.                                                            

The purchase price for the community was $20,242,177, paid as follows:          
(i) $18,100,000 to the unaffiliated seller of the property; (ii) $606,679 in    
customary closing costs; and (iii) $1,535,498 in renovation costs and operating 
reserves. The closing occurred on May 30, 2003, and the purchase price was      
funded by a combination of first mortgage debt and borrowings on our affiliate  
line of credit. The independently appraised value of the community at the time  
of closing was $19,995,000. With current first mortgage debt in the principal   
amount of $12,958,000, the community's loan-to-value ratio is 64.81%. We will   
only be liable to the community and its creditors up to the amount of our       
initial capital in the community.                                               

The property management agent is Pinnacle Realty Management Company, which is   
affiliated with GFS Equity Management LLC. Pinnacle has managed the community   
since its acquisition and until March 1, 2005, received a property management   
fee equal to 4.0% of gross income (of which 0.5% was payable after the Company  
had received the preferred return on its unreturned capital contributions). As  
of March 1, 2005, we reduced the management fee to 3.5% of gross income until   
the property reaches certain performance hurdles. Pinnacle also manages Bridge  
Creek's sister community Boulder Creek as well as one other property in the     
immediate submarket not owned by us. That property has fewer but larger units   
than Bridge Creek and Boulder Creek and is not considered direct competition to 
these communities. Bridge Creek and Boulder Creek do compete with each other.   
However, the communities refer business to each other to provide the best       
service possible to potential tenants and to optimize occupancy at both         
communities.                                                                    

Renovations on the property including repairs to siding and decking, repairs to 
bathroom exhaust ducting, replacement of some carpet, flooring, appliances, and 
countertops, upgrades to the clubhouse, and re-surfacing the parking area are   
complete. A total of $250 per unit from remaining funds will be added to a      
replacement reserve for the future. In addition, $157,500 will be placed in     
reserve to paint the property in 2008. An operating reserve funded from the     
proceeds of the purchase price was used to supplement the income of the         
community sufficient for us to make distributions to investors in accordance    
with our investment objectives.                                                 

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All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         94%               90%           92%           89%           91%     

As of December 31, 2005, the occupancy rate was 97%.                            

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005   
   ----               ----          ----          ----          ----   
                                                                       
$7,845/unit       $7,668/unit   $7,261/unit   $7,242/unit   $7,183/unit

In 2002, the local real estate market weakened, resulting in both an increase in
the property's vacancy rate and a need to offer rent concessions. The property  
was purchased based on the market conditions that were present in 2002. The     
market did not strengthen in 2003 or 2004. The property was purchased with a    
plan to renovate and reposition it, and it is management's belief that, as the  
local real estate market strengthens, concessions will come to an end, the      
annual rental rates will increase and vacancy will decrease.                    

The community is located in Wilsonville, Clackamas County, Oregon, approximately
17 miles south of downtown Portland and 25 miles north of the state capital.    
This area had an average residential vacancy of 6.1% in 2005. The greater       
Portland area had a median income of $67,900 as of 2006 according to HUD. The   
immediate neighborhood is a mixture of early to mid-1990's multifamily          
developments, single-family subdivisions, neighborhood retail, service stations 
and public schools. Directly north is a Hathaway Village apartment complex.     
Directly south of the property is Wilsonville Road; across the road are some    
single-family residences and then Wilsonville Memorial Park. The property abuts 
a Methodist Church and Hathaway Village apartment complex to the east. To the   
west is a greenbelt followed by Wilsonville Community Center to the south and   
condos and single-family residences to the north.                               

- Bridge Creek's sister property, Boulder Creek, is located about one-half miles
 northeast, was built in phases between 1988 and 1990. A 296-unit property, it
has a similar apartment mix although it includes 2BR/1BA and 2BR/2BA floor  
  plans, similar range in unit size, and comparable amenities to those at Bridge
Creek. Berkshire Court is located on Wilsonville Road about one-half mile   
north of the subject. It is a 266-unit community constructed in 1996.       
Berkshire Court is identical in the                                         

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floor plans but has more 2BR/1BA units than Bridge and has comparable       
amenities to those offered at Bridge Creek. Hathaway Court is located on    
  Wilsonville Road about one-quarter mile north of the subject. It is a 298-unit
community constructed between 1997 and 1998. Hathaway Court is identical in 
 the floor plans to both Bridge Creek and Berkshire Court but has more 2BR/1BA
units than Bridge Creek and offers comparable amenities. Town Center Park is
located approximately one mile west of Bridge Creek Apartments. Town Center 
Park, which was built in 1991, is comprised of 111 units with much larger   
floor plans and no 2BR/1BA models. Town Center Park offers similar amenities
  but is more conveniently located to shopping and services. Sundial Apartments,
with 120 units, is located about one and a quarter miles northwest of Bridge
Creek. Built in 1991, Sundial offers an inferior amenity package. Sundial's 
apartments are smaller than those at Bridge Creek and it does not offer     
2BR/1BA units.                                                              

Bridge Creek is expected to continue to compete successfully in its market.     
Located in Clackamas County with an attractive quality of life, the Wilsonville 
area offers affordable living, convenient shopping, good schools and ready      
access to neighborhood employment. Although the economy of the region has been  
fairly diversified, economic events over the past several years have taken their
toll on local employment although much less than on the rest of the Portland    
area. Oregon's managed growth policy has moderated large swings in rental       
housing supply that typically accompany economic fluctuations. While low        
interest rates have impacted the rental community as a whole with a migration to
homeownership, the effect on Bridge Creek appears to have been minimal. Bridge  
Creek offers social and recreational amenities equivalent to those at comparable
properties. Renovation of the second clubhouse and pool area differentiates     
Bridge Creek through additional amenities and services that some competing      
properties do not provide.                                                      

Settler's Point Apartments

Settler's Point Apartments is an existing multifamily apartment complex         
consisting of 416 units located in suburban Salt Lake City, Utah. The community 
consists of 50 two-story buildings on a landscaped setting and includes the     
following interior amenities: dishwasher, frost free refrigerator, electric     
stove/oven, garbage disposal, built-in microwave, ceiling fans, wood burning    
fireplace, wall-to-wall carpet, patios/balconies, vaulted ceilings, cable       
access, high speed internet access, washer/dryer connections, stacked           
washer/dryer furnished (288 units), side-by-side washer/dryer furnished (128    
units), and storage closets. Exterior amenities include: carports, outdoor spa, 
two outdoor swimming pools, fitness center, two tennis courts, and some         
perimeter fencing. There are 136 one-bedroom units,                             

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56 two-bedroom/one-bath units, and 224 two-bedroom/two-bath units. The apartment
units have an average size of 876 square feet. The community was constructed in 
1985 and 1986.                                                                  

The purchase price for the community was $23,396,250, paid as follows:          
(i) $21,500,000 to the unaffiliated seller of the property; (ii) $826,898 in    
customary closing costs; and (iii) $1,069,352 in renovation costs and operating 
reserves. The closing occurred on May 30, 2003, and the purchase price was      
funded by a combination of first mortgage debt and borrowings on our affiliate  
line of credit. The independently appraised value of the community at the time  
of closing was $22,200,000. With current first mortgage debt in the principal   
amount of $15,000,000, the community's loan-to-value ratio is 67.57%. We will   
only be liable to the community and its creditors up to the amount of our       
initial capital in the community.                                               

The property management agent is Pinnacle Realty Management Company, which is   
affiliated with GFS Equity Management LLC. Pinnacle has managed the property    
since its acquisition and receives a property management fee equal to 4.0% of   
gross income (of which 0.5% is payable after the Company has received the       
preferred return on its unreturned capital contributions). Pinnacle also manages
communities in the market not owned by us; however, we do not consider these    
properties to be in direct competition with our communities.                    

Renovations on the property including repairs to pavement, sidewalks, patio     
fencing, balconies, and stairs as well as addressing ADA issues, upgrading the  
site exterior lighting for safety, installing new signage, replacing Brookfield 
evaporative-cooling units with new air conditioning condensing units, replacing 
polybutylene plumbing with copper; and installing ground-fault interrupter      
receptacles in the kitchens and bathrooms of all units have been completed. An  
operating reserve funded from the proceeds of the purchase price was used to    
supplement the income of the community sufficient for us to make distributions  
to investors in accordance with our investment objectives.                      

All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         91%               88%           93%           92%           94%     

As of December 31, 2005, the occupancy rate was 95%.                            

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The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005   
   ----               ----          ----          ----          ----   
                                                                       
$7,564/unit       $7,071/unit   $6,989/unit   $6,869/unit   $6,960/unit

The community is located in Taylorsville, Utah, an area which has historically  
had higher than normal residential vacancy rates over the past couple of years, 
mainly due to low mortgage interest rate levels that allow tenants to afford    
entry-level housing, and an excess supply of inventory related to the Olympic   
Games and subsequent departure of service and support personnel. However,       
vacancy has improved, averaging 5.7% in 2005. The greater Salt Lake City area   
has a median income of $61,400 as of 2006 according to HUD. The property was    
purchased with a plan to renovate and reposition it and it is management's      
belief that, as the local real estate market strengthens, concessions will burn 
off, the annual rental rates will increase and vacancy will decrease.           

- Settler's Point is located south of the central business district of Salt Lake
City, within the Salt Lake Valley, in the city of Taylorsville. The site is 
conveniently and centrally located between two major freeways, I-15 to the  
east and I-215 to the west and south. The property's immediate surroundings 
  include a City of Taylorsville park, adjoining to the west and Fore Lakes golf
course, a par 3 golf course, adjoining to the south and east. Local shopping
 is within walking distance and consists of neighborhood centers located north
 and west of the park. Just to the west, the N/S cross street is Redwood Road,
the retail arterial road for the neighborhood. The Primary Market Area is   
  about a 5-mile square with the subject in the approximate center. The majority
of competition is lying within that area and the majority of potential      
prospects are expected to be residing within that area.                     

Settler's Point competes well in its market. Strategically located with easy    
access to I-15 and I-215, the community offers an attractive quality of life.   
The Taylorsville area offers affordable living, excellent access to local       
shopping, good schools and ready access to major employment centers. We expect  
that the economic slowdown after the winter 2002 Olympic Games will subside and 
the area will return to the more typical growth seen through the 1990s.         
Settler's Point offers social and recreational amenities equivalent to those at 
comparable properties.                                                          

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SEATTLE, WASHINGTON COMMUNITIES 

We own interests in four apartment communities in Seattle, Washington-          
Alderwood, Ridgetop, Ridgegate and Wellington. To acquire these interests, we   
borrowed approximately $9,325,980 under our affiliate line of credit. This      
amount includes the equity required to purchase the properties, initial capital 
requirements for planned renovations, establishment of operating reserves and   
costs associated with our affiliate line of credit with respect to the          
transaction. In addition, the Seattle communities are encumbered with           
$37,850,000 of first mortgage debt as well as $7,987,418 of second mortgage debt
as of December 31, 2005. From the proceeds of this offering, we will repay the  
outstanding portion of our affiliate line of credit attributable to these       
communities as well as the second mortgage debt on the communities, which must  
be repaid in order to bring our investment in these communities within our      
leverage limits. The outstanding first mortgage indebtedness on the Seattle     
communities will not be repaid with the proceeds of this offering, and will     
continue to encumber the communities in accordance with the terms of the        
respective mortgage loans. In addition, we will deduct $552,794 from the 2.70%  
acquisition fee we have agreed to pay our advisor related to the Seattle        
communities because of the prepaid acquisition fee.                             

Our advisor was not involved in the initial formation transactions for the      
Seattle communities. Originally, the Seattle communities were acquired by our   
advisor's affiliates before the offering of a publicly registered REIT was      
finalized. Accordingly, the ownership structure of the Seattle communities is   
more complicated. This structure has not been and will not be repeated for any  
other communities we own or may acquire. Here is a history of the purchase and  
ownership of the Seattle communities.                                           

(1) On July 11, 2002, Goodman Financial Services, Inc., an affiliate of GFS     
   Equity Management LLC, negotiated and entered into a purchase agreement for
   the Seattle communities from an unaffiliated seller for a purchase price of
$51,366,000.                                                            

(2) In December, 2002, affiliates of our advisor wanted to acquire the Seattle  
communities from GFS Equity Management LLC for possible investment by a 
  group of private investors. GFS Equity Management LLC agreed to assign its
    entire interest in the Seattle community purchase contracts to affiliates of
our advisor in return for the initial management contract for the       
communities, as well as a subordinated interest in cash flow and sale   
proceeds.                                                               

(3) BC-GFS LLC was formed by John P. Manning, our Chairman and Chief Executive, 
    as the entity that the purchase contracts were to be assigned. The owners of
    BC-GFS, LLC were BCMR Special, Inc. and BCMR Seattle, A Limited Partnership,
both controlled by our affiliates,                                      

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    and GFS Equity Management LLC. BCMR Seattle, a Limited Partnership, also had
as its partners entities controlled by our affiliates. This complicated 
   structure was previously used when market rate communities were invested in
   by private investors. The following chart describes the former ownership of
the Seattle properties:                                                 

                                                                [Download Table]
                                                                    
*--------------------------*     *--------------------------*       
* BOSTON CAPITAL COMPANION *     *     JOHN P. MANNING      *       
*   LIMITED PARTNERSHIP*   *     *    (SOLE SHAREHOLDER)    *       
*--------------------------*     *--------------------------*       
         *       *                            *                     
    100% *       * 100%                       *                     
         *       *                            *                     
         *       *                            *                     
         *       *               *---------------------------*      
         *       *               *     BCMR SEATTLE, INC.    *      
         *       *               *---------------------------*      
         *       *                            *                     
         *       *                            *                     
         *       *                 99.99% LIMITED PARTNER           
         *       *                            *                     
         *       *                            *                     
         *       *    *--------------------*  *                     
         *       *----*     BCMR, INC.     *  *                     
         *            *--------------------*  *                     
         *                          *         *                     
         *                          *         *                     
         *             0.01% GENERAL PARTNER  *                     
         *                          *         *                     
         *                          *         *                     
         *                          *         *                     
*--------------------------*     *---------------------------*      
*    BCMR SPECIAL, INC.    *     *       BCMR SEATTLE,       *      
*                          *     *   A LIMITED PARTNERSHIP   *      
*--------------------------*     *---------------------------*      
                      *                       *                     
                      * EXERCISES VOTING      *                     
                      * RIGHTS OF BCMR        * CONTROLLING INTEREST
                      * SEATTLE, A LIMITED    *                     
                      * PARTNERSHIP           *                     
                      *          *---------------------------*      
                      *----------*                           *      
*--------------------------*     *        BC-GFS LLC         *      
*       GFS EQUITY         *-----*                           *      
*     MANAGEMENT LLC       *     *---------------------------*      
*--------------------------* ECONOMIC         *                     
                             INTEREST         *                     
                                              *                     
                                         100% *                     
                                              *                     
                                              *                     
                                              *                     
*------------------------------------------------------------*      
*                      OPERATING LLCs                        *      
*------------------------------------------------------------*      
                              *                                     
                              *                                     
                              *                                     
                        /----------\                                
                       /            \                               
                      /  COMMUNITIES \                              
                      \              /                              
                       \------------/                               

--------                                                                        

*   John P. Manning owns the general partner of and a limited partner interest  
in Boston Capital Companion Limited Partnership                         

(4) On December 12, 2002, BCMR Seattle, Inc. contributed $8,626,939 to BCMR     
    Seattle, a Limited Partnership, to purchase the four Seattle communities. On
December 16, 2002, all four of the Seattle communities were purchased   
through four wholly-owned subsidiaries of                               

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  BC-GFS LLC for a purchase price of $54,596,940. The difference between the
$51,366,000 contract price and the $54,596,940 paid by BC-GFS LLC is    
comprised of customary real estate closing costs of $2,438,880 paid to  
non-affiliates and $1,199,165 in renovation costs and operating reserves
escrowed for the communities. In addition, there was ($407,105) in      
prorations credited to the buyer at closing which consisted of tenant   
   security deposits, unpaid real estate taxes and utility bills. The purchase
 price was funded by payment of $8,626,939 of equity, $37,850,000 of first
mortgage debt, and $8,120,000 of second mortgage debt.                  

(5) An acquisition fee of $552,794 (2.79% of the offering proceeds related to   
the Seattle communities of approximately $20.2 million) and acquisition 
expenses of $49,739 for the Seattle communities (0.25% of the offering  
 proceeds related to the Seattle communities) were paid to an affiliate of
  our advisor. The prepaid acquisition fee and expense reimbursement will be
deducted from the 2.70% acquisition fee and 0.5% acquisition expense    
reimbursement we have agreed to pay to our advisor with respect to the  
Seattle communities.                                                    

(6) During the first quarter of 2003, the Seattle communities were deemed a     
suitable investment for our Company. On May 15, 2003, we acquired BCMR  
   Seattle, Inc.'s entire 99.99% limited partnership interest in BCMR Seattle,
  A Limited Partnership, by assuming its $9,325,984 of acquisition debt, but
 paying no additional fees, expenses, or other consideration. This assumed
debt was rolled into our affiliate line of credit.                      

We acquired our interests in the Seattle communities by acquiring a 99.99%      
limited partnership interest in BCMR Seattle, A Limited Partnership, which owns 
a controlling member interest in BC-GFS LLC, which owns legal fee simple title  
to the communities through four wholly owned subsidiaries. The general partner  
of BCMR Seattle, A Limited Partnership, is BCMR, Inc., which is an affiliate of 
our advisor. BCMR Special, Inc., which is an affiliate of our advisor, acts as  
investment manager of BC-GFS LLC for the purpose of exercising certain consent  
rights for all material decisions regarding the Seattle communities. Neither    
BCMR, Inc. nor BCMR Special, Inc. can exercise any voting rights contrary to our
direction or interests. Neither BCMR, Inc. nor BCMR Special, Inc. will receive  
any compensation from this offering or our operations as a result of their roles
as owners of BCMR Seattle, A Limited Partnership or BC-GFS, LLC. This structure 
exists only for the Seattle communities for the reasons described above and will
not be used in any other acquisitions we make. We can remove BCMR, Inc. and BCMR
Special, Inc. at any time without cause. The manager of BC-GFS LLC is GFS Equity
Management LLC, a third                                                         

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party which is not affiliated with us or our advisor. GFS Equity Management LLC 
must obtain the consent of BCMR Seattle, A Limited Partnership before it can    
make material decisions and it can be replaced by BCMR Seattle, A Limited       
Partnership at any time.                                                        

GFS Equity Management, LLC is entitled to participate in the cash distributions 
of the Seattle communities after we (the REIT) have received a priority share of
the cash flow. Before GFS Equity Management LLC receives any portion of the cash
flow, we will receive:                                                          

(i)  a 12% preferred return on our unreturned capital contributions (which      
initially were $8,626,939); and                                         

(ii) $50 annually per apartment unit (a total of 802 units times $50 equals     
$40,100 annually).                                                      

To the extent we receive this priority share of the cash flow, it will be used  
to pay our ordinary expenses, including operational-stage fees and reimbursement
to our advisor and affiliates. After payment of such expenses, the priority cash
flow would be available for distribution to stockholders. There is no guarantee 
that there will be sufficient priority cash flow to make any distributions to   
stockholders. We will then share 50/50 with GFS Equity Management LLC in all    
remaining income from operations of the Seattle communities. Proceeds from the  
sale of any of the Seattle communities will first be distributed to pay us any  
unpaid preferred return. Remaining sale proceeds will be distributed to us until
we have received a return of our capital contributions (taking into account     
prior distributions) plus a 16% per annum rate of return on our capital         
contributions. We will then receive 75% and GFS Equity Management LLC will      
receive 25% of any remaining sale proceeds. There is no guarantee that any      
preferred return will be sufficient for us to make any distribution to          
stockholders. We believe that this arrangement is an appropriate incentive to   
encourage performance by GFS Equity Management LLC. We can remove GFS Equity    
Management LLC without cause at any time.                                       

Alderwood Park Apartments 

Alderwood Park Apartments is an existing multifamily apartment complex          
consisting of 188 units located in suburban Seattle, Washington. The community  
consists of 14 two-story buildings on a landscaped setting and includes the     
following interior amenities: dishwasher, frost free refrigerator, electric     
stove/oven, garbage disposal, wood burning fireplace, wall-to-wall carpet,      
patios/balconies, cable access, washer/dryer connections, stacked washer/dryer  
furnished and storage closet. The development also includes the following       
exterior amenities: carports, indoor spa, swimming pool, conference room, tenant
lounge, fitness center, tanning bed                                             

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and child's playground. There are 84 one-bedroom units and 104 two-bedroom      
units. The apartment units have a weighted average size of 762 square feet. The 
community was constructed in 1982.                                              

The purchase price for the community was $13,397,470, paid as follows:          
(i) $12,410,000 to the unaffiliated seller of the property; (ii) $600,660 in    
customary closing costs; (iii) $351,750 in renovation costs; and (iv) $35,060 in
operating reserves. The closing occurred on December 16, 2002, and the purchase 
price was funded by a combination of first mortgage debt, second mortgage       
financing and borrowings on our credit line. The independently appraised        
prospective value of the community at the time of closing was $12,950,000. With 
current first mortgage debt in the principal amount of $9,210,000, the          
community's loan-to-value ratio is 71.12%. We will only be liable to the        
community and its creditors up to the amount of our initial capital in the      
community.                                                                      

The property management agent is Pinnacle Realty Management Company, which is   
affiliated with GFS Equity Management LLC. Pinnacle has managed the community   
since its acquisition and receives a property management fee equal to 3.5% of   
gross income. Pinnacle also manages communities not owned by us that compete    
with our communities in the Seattle market.                                     

Renovations on the property including a remodeling of the clubhouse,            
improvements to the landscaping, repairs to balconies, landings, sidewalks, and 
the pool, replacement of the entry ramp, construction of a golf cart garage and 
improvements to fire safety and ADA issues have been completed. An operating    
reserve funded from the proceeds of the purchase price can be used to supplement
the income of the community sufficient for us to make distributions to investors
in accordance with our investment objectives. This operating reserve is being   
held in escrow at Wainwright Bank & Trust Company and any withdrawals from this 
reserve require our consent and signature.                                      

All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         94%                91%           89%           92%           95%    

As of December 31, 2005, the occupancy rate was 96%.                            

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The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005    
   ----               ----          ----          ----          ----    
                                                                        
$8,820/unit        $8,005/unit   $7,773/unit   $7,875/unit   $8,172/unit

In 2002, the local real estate market weakened, resulting in both an increase in
the property's vacancy rate and a need to offer selected rent concessions. The  
property was purchased based on the market conditions that were present in 2002.
The market remained weak in 2003 and most of 2004, improving in the fourth      
quarter of 2004 with the opening of the renovated Alderwood Mall near the       
property. It is management's belief that, as the local real estate market       
strengthens, the annual rent rate per unit will increase.                       

The community is located in Lynnwood, Washington, an area which has historically
had low residential vacancy rates (averaging 5.4% in 2005). The greater Seattle 
area had a median income of $77,900 as of 2006 according to HUD.                

- The Alderwood Park Apartments are located on 36th Avenue West, adjacent to the
Alderwood Mall. The neighborhood is a mixture of newer multifamily          
developments, a wide range of commercial-retail properties and single-family
home subdivisions. One block south of the property is a new senior citizen  
assisted living development. This development is part of a senior housing   
  campus consisting of townhouses and apartments which was under construction at
 the time of purchase. Along 36th Avenue are several apartment complexes which
are targeting households similar to those attracted to Alderwood Park       
Apartments. Five of these properties are considered to be comparable        
properties at the time of acquisition.                                      

- On 36th Avenue, directly across from Alderwood Park Apartments, is Alderwood  
 Heights Apartments. Constructed in 1986, this 272-unit property is similar to
Alderwood Park Apartments in terms of both unit mix and unit size. About one
 mile north of Alderwood Park Apartments is Countrywalk Apartments, consisting
of 228 apartments that were constructed in 1988, Directly across from       
 Countrywalk Apartments is Orchard Ridge Apartments, a 104-unit community that
was constructed in 1989. About one-half mile west of Countrywalk Apartments 
and Orchard Ridge Apartments is Canyon Springs Apartments, consisting of 254
units that were constructed in 1991. Further north on 36th Avenue, about two
miles from Alderwood Park Apartments, is the Renaissance Apartments, a      
361-unit gated community with a mixture of one-, two- and three-bedroom     
  apartments that were constructed in 1988. All of these properties have similar
amenities to those found at Alderwood                                       

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  Park Apartments, and many share a common attribute of multifamily developments
in the area, mature landscaping and park-like settings.                     

Ridgetop Apartments 

Ridgetop Apartments is an existing multifamily apartment complex consisting of  
221 units located in suburban Seattle, Washington. The community consists of 24 
two- and three-story buildings on a landscaped setting and includes the         
following interior amenities: dishwasher, frost-free refrigerator, ice makers,  
electric stove/oven, garbage disposal, built-in microwave, wood burning         
fireplace, wall-to-wall carpet, patios/balconies, cable access, washer/dryer    
connections, stacked washer/dryer furnished, ceiling fans, decorative mirrors,  
walk-in closets and storage closet. Exterior amenities include: carports, indoor
and outdoor spa, outdoor swimming pool, conference room, tenant lounge, fitness 
center, tanning bed, racquetball court and child's playground. There are 20     
studio units, 78 one-bedroom units, 95 two-bedroom units and 48 three-bedroom   
units. The apartment units have a weighted average size of 871 square feet. This
community was constructed in 1989.                                              

The purchase price for the community was $14,076,016, paid as follows:          
(i) $13,234,250 to the unaffiliated seller of the property; (ii) $620,856 in    
customary closing costs; and (iii) $220,910 in renovation costs and operating   
reserves. The closing occurred on December 16, 2002, and the purchase price was 
funded by a combination of first mortgage debt, second mortgage financing and   
borrowings on our credit line. The independently appraised prospective value of 
the community at the time of closing was $13,650,000. With current first        
mortgage debt in the principal amount of $9,690,000, the community's            
loan-to-value ratio is 70.99%. We will only be liable to the community and its  
creditors up to the amount of our initial capital in the community.             

The property management agent is Pinnacle Realty Management Company, which is   
affiliated with GFS Equity Management LLC. Pinnacle has managed the community   
since its acquisition and receives a property management fee equal to 3.5% of   
gross income. Pinnacle also manages communities not owned by us that compete    
with our communities in the Seattle market.                                     

Renovations on the property including a remodeling of the clubhouse,            
improvements to landscaping, repairs to balconies, landings, sidewalks, and the 
pool, and improvements to fire safety and ADA issues have been completed. An    
operating reserve funded from the proceeds of the purchase price can be used to 
supplement the income of the community sufficient for us to make distributions  
to investors in accordance with our investment objectives. This operating       
reserve is being held in escrow at                                              

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Wainwright Bank & Trust Company and any withdrawals from this reserve require   
our consent and signature.                                                      

All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         97%                97%           94%           95%           96%    

As of December 31, 2005, the occupancy rate was 97%.                            

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005 
   ----               ----          ----          ----          ---- 
                                                                     
$8,041/unit        $8,409/unit   $8,909/unit   $9,423/unit     $9,953

The community is located in Silverdale, Washington, an area which has           
historically had low residential vacancy rates (averaging 5.8% in 2005). The    
greater Seattle area had a median income of $77,900 as of 2006 according to HUD.

- Ridgetop Apartments is located about a mile and one-half from State Highway 3,
the primary north-south route serving Kitsap County. The neighborhood is a  
mixture of newer multifamily developments, neighborhood retail, service     
stations, public schools and single-family subdivisions. Many of the        
  single-family home subdivisions in the neighborhood were developed in the last
 ten years and sales prices averaged between $150,000 and $175,000 at the time
of purchase.                                                                

- Five apartment properties located in the Silverdale area were selected as     
comparable properties at the time of acquisition. The Outlook, situated less
than a mile north of the Ridgetop Apartments, consists of 210 units.        
  Constructed in 1991, the Outlook offers similar amenities to those provided at
Ridgetop Apartments.                                                        

- Ridgetop Apartments' sister property, Wellington Apartments, is located       
approximately two miles to the southwest, across from the Kitsap Mall.      
Wellington Apartments, constructed in 1988, is a 240-unit property in a     
residential area with large multifamily developments and single-family tract
  home subdivisions. Wellington Apartments has a similar apartment mix, range in
unit size, and comparable amenities to those offered at Ridgetop Apartments.

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- Also located in the Ridgetop Apartments area is Quail Hollow Apartments, a    
  201-unit development. Similar to Ridgetop Apartments, this property is located
in a neighborhood of large multifamily developments and single-family homes.
  Quail Hollow Apartments, constructed in 1988, also offers comparable amenities
to those at Ridgetop Apartments.                                            

- Santa Fe Ridge Apartments is located only about two blocks north of the       
  Ridgetop Apartments. Santa Fe Ridge Apartments, which was constructed in 1992,
is comprised of 240 units of similar size and unit mix to that of Ridgetop  
Apartments. Santa Fe Ridge Apartments offers amenities similar to those of  
Ridgetop Apartments.                                                        

- Olympic Village Apartments, with 340 units, is located in Bremerton, less than
three miles southeast of Ridgetop Apartments. Similar to the other competing
 properties surveyed in this report, Olympic Village Apartments is situated in
 an area heavily developed with large multifamily properties and single-family
  subdivisions. Olympic Village Apartments was constructed in 1993 and offers an
amenity package similar to that available at Ridgetop Apartments.           

Ridgetop Apartments is located in a real estate market that has historically    
been underserved by multifamily housing. Occupancy rates have historically      
remained relatively high in the area and rents have generally increased. There  
is a significant military presence in this market that has been stable for a    
number of years. Individuals actively serving in the military together with     
individuals working in support jobs for the military have helped maintain a     
stable local market. There is no evidence that this presence will change in the 
foreseeable future.                                                             

Wellington Apartments 

Wellington Apartments is an existing multifamily apartment complex consisting of
240 units located in suburban Seattle, Washington. The community consists of 16 
two- and three-story buildings on a landscaped setting and includes the         
following interior amenities: dishwasher, frost free refrigerator, ice makers,  
electric stove/oven, garbage disposal, wood burning fireplace, wall-to-wall     
carpet, patios/balconies, cable access, washer/dryer connections, stacked       
washer/dryer furnished, ceiling fans, decorative mirrors, walk-in closets and   
storage closet. Exterior amenities include: carports, indoor spa, swimming pool,
tenant lounge, fitness center, tanning bed, racquetball court and playground.   
There are 132 one-bedroom units and 108 two-bedroom units. The apartment units  
have a weighted average size of 947 square feet. The community was constructed  
in 1988.                                                                        

The purchase price for the community was $16,744,073, paid as follows:          
(i) $15,635,000 to the unaffiliated seller of the property; (ii) $738,013 in    
customary closing costs; and (iii) $371,060 renovation costs and operating      

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reserves. The closing occurred on December 16, 2002, and the purchase price was 
funded by a combination of first mortgage debt, second mortgage financing and   
borrowings on our credit line. The independently appraised prospective value of 
the community at the time of closing was $15,650,000. With current first        
mortgage debt in the principal amount of $11,530,000, the community's           
loan-to-value ratio is 73.67%. We will only be liable to the community and its  
creditors up to the amount of our initial capital in the community.             

The property management agent is Pinnacle Realty Management Company, which is   
affiliated with GFS Equity Management LLC. Pinnacle has managed the community   
since its acquisition and receives a property management fee equal to 3.5% of   
gross income. Pinnacle also manages communities not owned by us that compete    
with our communities in the Seattle market.                                     

Renovations on the property including a remodeling of the clubhouse,            
improvements to landscaping, repairs to balconies, landings, sidewalks, and the 
pool, and improvements to fire safety and ADA issues have been completed. An    
operating reserve funded from the proceeds of the purchase price can be used to 
supplement the income of the community sufficient for us to make distributions  
to investors in accordance with our investment objectives. This operating       
reserve is being held in escrow at Wainwright Bank & Trust Company and any      
withdrawals from this reserve require our consent and signature.                

All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         97%                96%           96%           91%           96%    

As of December 31, 2005, the occupancy rate was 98%.                            

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005    
   ----               ----          ----          ----          ----    
                                                                        
$8,308/unit        $8,586/unit   $9,175/unit   $9,190/unit   $9,826/unit

The community is located in Silverdale, Washington, an area which has           
historically had low residential vacancy rates (averaging 5.8% in 2005). The    
greater Seattle area had a median income of $77,900 as of 2006 according to HUD.

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- Wellington Apartments is located across from and just west of the Kitsap Mall.
The area is comprised of numerous neighborhood retail centers that are      
typically developed adjacent to regional malls, service businesses and      
agencies, restaurants, healthcare services, apartments and single-family    
 subdivisions. Many of the single-family subdivisions in the neighborhood were
  developed in the last ten years and sales prices averaged between $150,000 and
$175,000 at the time of purchase.                                           

- Five apartment properties located in the Silverdale area were selected for    
  purposes of comparison at time of acquisition. The Outlook, situated about one
and a half miles northeast of Wellington Apartments, consists of 210-units. 
  Constructed in 1991, the Outlook offers similar amenities to those provided at
Wellington Apartments.                                                      

- Wellington Apartments' sister property, Ridgetop Apartments, is located       
approximately two miles northeast along Ridgetop Boulevard and less than a  
mile from the Harrison Silverdale Healthcare Campus. Ridgetop Apartments,   
  which was constructed in 1989, is a 221-unit property located in a residential
area with large multifamily developments and single-family tract home       
subdivisions. Ridgetop Apartments has a similar apartment mix, range in unit
size and comparable amenities to those offered at Wellington Apartments.    

- Also located close to Ridgetop Apartments is Quail Hollow Apartments, a       
  201-unit development. Similar to Ridgetop Apartments, this property is located
in a neighborhood of large multifamily developments and single-family homes.
  Quail Hollow Apartments, constructed in 1988, also offers comparable amenities
to those at Wellington Apartments.                                          

- Santa Fe Ridge Apartments is located northeast of Wellington Apartments and is
only about two blocks from Ridgetop Apartments. Santa Fe Ridge Apartments,  
which was built in 1992, is comprised of 240 units of similar size and unit 
mix to that of Wellington Apartments. Santa Fe Ridge Apartments offers      
amenities similar to those of Wellington Apartments.                        

- Olympic Village Apartments, with 340 units, is located approximately three    
miles southeast of Wellington Apartments. Similar to the other competing    
 properties surveyed in this report, Olympic Village Apartments is situated in
 an area heavily developed with large multifamily properties and single-family
  subdivisions. Olympic Village Apartments was constructed in 1993 and offers an
amenity package similar to that available at Wellington Apartments.         

Wellington Apartments is located in a real estate market that has historically  
been underserved by multifamily housing. Occupancy rates have historically      
remained relatively high in the area and rents have generally                   

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increased. There is a significant military presence in this market that has been
stable for a number of years. Individuals actively serving in the military      
together with individuals working in support jobs for the military have helped  
maintain a stable local market. There is no evidence that thus presence will    
change in the foreseeable future.                                               

Ridgegate Apartments

Ridgegate Apartments is an existing multifamily apartment complex consisting of 
153 units located in suburban Seattle, Washington. The community consists of 14 
two-story buildings on a landscaped setting and includes the following interior 
amenities: dishwasher, frost-free refrigerator, ice makers, electric stove/oven,
garbage disposal, built-in microwave, wood burning fireplace, wall-to-wall      
carpet, patios/balconies, cable access, washer/dryer connections, stacked       
washer/dryer furnished, ceiling fans, decorative mirrors, walk-in closets and   
storage closet. Exterior amenities include: carports, indoor spa, swimming pool,
tenant lounge, fitness center, tanning bed, racquetball court and child's       
playground. There are 62 one-bedroom units, 60 two-bedroom units and 31         
three-bedroom units. The apartment units have a weighted average size of 891    
square feet. This community was constructed in 1990.                            

The purchase price for the community was $10,786,486, paid as follows:          
(i) $10,086,750 to the unaffiliated seller of the property; (ii) $479,351 in    
customary closing costs; (iii) $185,325 in renovation costs; and (iv) $35,060 in
operating reserves. The closing occurred on December 16, 2002, and the purchase 
price was funded by a combination of first mortgage debt, mezzanine financing   
and borrowing on our credit line. The independently appraised prospective value 
of the community at the time of closing was $10,550,000. With current first     
mortgage debt in the principal amount of $7,420,000, the community's            
loan-to-value ratio is 70.33%. We will only be liable to the community and its  
creditors up to the amount of our initial capital in the community.             

The property management agent is Pinnacle Realty Management Company, which is   
affiliated with GFS Equity Management LLC. Pinnacle has managed the community   
since its acquisition and receives a property management fee equal to 3.5% of   
gross income. Pinnacle also manages communities not owned by us that compete    
with our communities in the Seattle market.                                     

Renovations on the property including a remodeling of the clubhouse,            
improvements to landscaping, repairs to balconies, landings, sidewalks, and the 
pool, and improvements to fire safety and ADA issues have been completed. An    
operating reserve funded from the proceeds of the purchase price can be used to 
supplement the income of the community                                          

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sufficient for us to make distributions to investors in accordance with our     
investment objectives. This operating reserve is being held in escrow at        
Wainwright Bank & Trust Co. and any withdrawals from this reserve require our   
consent and signature.                                                          

All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                            Year End December 31,                            
-----------------------------------------------------------------------------
        2001               2002          2003          2004          2005    
        ----               ----          ----          ----          ----    
                                                                             
         94%                96%           96%           92%           94%    

As of December 31, 2005, the occupancy rate was 91%.                            

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

   2001               2002          2003          2004          2005    
   ----               ----          ----          ----          ----    
                                                                        
$9,339/unit        $8,660/unit   $9,075/unit   $8,971/unit   $9,009/unit

The community is located in Kent, Washington, an area which has historically had
low residential vacancy rates (averaging 5.6% in 2005). The greater Seattle area
had a median income of $77,900 as of 2006 according to HUD.                     

- Along SE 248th St. are several apartment properties targeting households      
  similar to those that have been attracted to Ridgegate Apartments. Directly to
the west of Ridgegate Apartments is a newer single-family subdivision with  
homes starting in the low $200,000 range at the time of purchase. To the    
northwest and southwest, there are numerous new and older single-family home
subdivisions. The nearest competitor to Ridgegate Apartments is Forest Creek
Apartments. This development is located to the south of the property but    
separated by a small park and it is comprised of 92 units. Forest Creek     
Apartments is also managed by Pinnacle Realty Management Company and was    
  constructed in 1991. Its amenities are slightly inferior to those at Ridgegate
Apartments as a result of its smaller size, but its unit mix and rent rates 
are comparable.                                                             

- One block north of Ridgegate Apartments is The Wilson, an 82-unit gated       
community constructed in 2001. This development has similar unit sizes, mix 
 and rent rates but has slightly inferior recreational amenities when compared
to Ridgegate Apartments.                                                    

- Approximately two miles to the west of Ridgegate Apartments on highway 516 is 
Signature Pointe. Signature Pointe is comprised of 624 units                

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and is also managed by Pinnacle Realty Management Company. Constructed in   
1989, Signature Pointe has a similar unit mix and unit sizes compared to    
Ridgegate Apartments. It also has slightly superior amenities compared to   
 those offered at Ridgegate Apartments. Its location is inferior, however: the
  property is located close to a major highway and is split into two sections by
a highway, making the recreational facilities less convenient to a large    
number of its residents. The property also has the appearance of being more 
densely developed.                                                          

Ridgegate enjoys either a location that is superior or physical amenities that  
are superior to many of the other multifamily developments in the area. These   
factors, combined with the improvements that are being made to the property, are
expected to allow the property to compete favorably with the other developments.

PLANO, TEXAS COMMUNITY

On September 15, 2005, we acquired an interest in an existing multifamily       
apartment community consisting of 229 units in Plano, Texas known as the Preston
at Willow Bend Apartments, which has since been renamed Broadstone Preston at   
Willow Bend Apartments. We refer to this community as our Plano community. We   
acquired our interest in the property through BC Broadstone Preston, LP, a joint
venture between us and certain affiliates of Alliance. We own a controlling     
partnership interest in BC Broadstone Preston, LP through two wholly-owned      
subsidiaries, ALLTX GP, LLC and ALLTX, LLC. BC Broadstone Preston, LP purchased 
the property from ERP Operating Limited Partnership for a contract purchase     
price of approximately $15,200,000. We have also borrowed an additional         
$2,512,348 to fund renovations and operating reserves, and to pay customary     
closing costs of approximately $1,700,000 and $831,347, respectively.           

To fund a portion of the purchase price, we contributed $5,556,348 to BC        
Broadstone Preston, LP by borrowing that amount from Wachovia Bank, National    
Association. The interest on the Wachovia loan accrues in arrears at an interest
rate of, at our election, LIBOR plus 300 basis points per annum or Wachovia     
Bank, National Association's announced prime rate plus 150 basis points per     
annum and is due and payable monthly to the extent that distributions are       
received from us by BC Broadstone Preston, LP, and, to the extent the interest  
is not paid, will be added to principal. The loan matures on July 3, 2006 and is
pre-payable at any time without fee subject to LIBOR breakage costs. We may     
extend the maturity date for an additional period through January 1, 2007       
provided no default or event of default shall then be in existence under the    
loan agreement; we pay an extension fee equal to 42 basis points of the         
outstanding balance of the loan as of July 3, 2006; and we provide written      
notice to Wachovia of our request for an extension of the maturity date no later
than June 3, 2006.                                                              

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The loan is secured by our interests in BC Broadstone Preston, LP, and is       
guaranteed by ALLTX GP, LLC and BCP Funding, LLC, our affiliate and an affiliate
of our advisor. In connection with our procurement of the loan, BCP Funding, LLC
agreed that it will continue to receive payment on our outstanding borrowings   
under our affiliate line of credit with respect to our existing properties until
all liens on such properties, other than the lien associated with our Seattle   
communities, are released. Once all liens on our existing properties (with the  
exception of the lien associated with the Seattle communities) are released, BCP
Funding, LLC has agreed that we may utilize proceeds from this offering to pay  
the Wachovia loan before the payment of the borrowings associated with the      
Seattle communities. In order to retain all of the communities we have acquired,
including our Plano community, we will have to raise approximately $74,495,922  
(not including any accrued interest on our affiliate line of credit or amounts  
distributed to stockholders from offering proceeds) by January 1, 2007 and, at  
that time, repay the Wachovia loan with either borrowings under an anticipated  
line of credit or by refinancing permanent mortgage debt on our communities, or 
to the extent that we have raised approximately $80,890,183 (not including any  
accrued interest on our affiliate line of credit or the Wachovia loan or amounts
distributed to stockholders from offering proceeds) by January 1, 2007, with the
proceeds received from this offering.                                           

At closing, $10,400,000 of a maximum $12,000,000 mortgage bridge loan from      
Deutsche Bank Berkshire Mortgage, Inc. was used to fund a portion of the        
contract purchase price and related costs, which were approximately $16,131,347,
and the remaining $1,600,000 was deposited into a repair escrow with the bridge 
lender until such time as the permanent mortgage closed. The mortgage bridge    
loan had a sixty-day term and an interest rate of one-month LIBOR plus 100 basis
points. On October 25, 2005, we refinanced the above-mentioned mortgage bridge  
loan with a permanent mortgage with a maximum principal amount of $11,981,000   
with Deutsche Bank Berkshire Mortgage, Inc. as lender, making available to our  
Company the $1,600,000 with which to proceed with capital improvements work in  
the property. The $19,000 difference between the mortgage bridge loan and the   
permanent mortgage was funded by property level working capital reserves. The   
permanent mortgage has a fixed interest rate of 5.14% and is for a nine-year    
term with only interest payments made monthly for such time. In addition, the   
loan may be extended for one year at a floating rate of 250 basis points over   
the Freddie Mac index rate.                                                     

An acquisition fee of approximately $173,000 will be paid to our advisor once   
the lien under the Wachovia loan on the Plano community is released.            

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Alliance Residential LLC is the managing general partner of BC Broadstone       
Preston, LP. The managing general partner must obtain our consent before it can 
make material decisions with respect to actions by the joint venture and it can 
be replaced by us at any time. Alliance Residential LLC is entitled to          
participate in the cash distributions of BC Broadstone Preston, LP after we have
received a priority share of the operating cash flow from our Plano community.  
Before Alliance Residential LLC receives any portion of the cash flow, we will  
first receive an annual asset management fee equal to $11,450 annually. After   
payment of this fee, we and Alliance Residential LLC will receive ratably a 10% 
preferred return on unreturned capital (which initially was $5,556,348 and      
$175,000, respectively). We will then share 80/20 with Alliance Residential LLC 
in all remaining cash flow from operations of our Plano community.              

To the extent we receive distributions from BC Broadstone Preston, LP, such     
distributions will be used, first to pay interest due on a monthly basis on the 
Wachovia loan and then to pay our ordinary expenses, including operational-stage
fees and reimbursement to our advisor and affiliates. After these payments, the 
amounts received from the distributions described above would be available to   
satisfy obligations of the REIT with any excess available for distribution to   
our stockholders. There is no guarantee that there will be sufficient cash flow 
from our Plano community to make the distributions described above.             

Proceeds from the sale of our Plano community will first be distributed to us in
payment of the accrued, but unpaid, management fee referred to above. Remaining 
sale proceeds will be distributed to us and Alliance Residential LLC ratably    
until we have each received our accrued and unpaid 10% preferred return and a   
return of our capital contributions. Remaining sale proceeds will then be       
distributed:                                                                    

- 80% to us and 20% to Alliance Residential LLC until we have received a 13% per
annum rate of return on our capital contributions (taking into account prior
distributions);                                                             

- then, 75% to us and 25% to Alliance Residential LLC until we have received a  
  16% per annum rate of return on our capital contributions (taking into account
prior distributions); and                                                   

- then, 70% to us and 30% to Alliance Residential LLC until we have received a  
 20% per annum rate of return on our capital contribution (taking into account
prior distributions); and                                                   

- then, any residual sale proceeds, 60% to us and 40% to Alliance Residential   
LLC.                                                                        

Our Plano community is an existing multifamily apartment complex consisting of  
229 units located in suburban Plano, Texas. The community                       

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consists of 23 three-story buildings on a landscaped setting and includes the   
following interior amenities: central air conditioning, dishwasher, frost-free  
refrigerator, electric stove/oven, garbage disposal, ceiling fans, crown        
molding, wall-to-wall carpeting, walk-in closets, patios/balconies, cable       
access, high speed internet access, storage closets and wood-burning fire       
places. The development also includes the following exterior amenities: 2       
swimming pools, BBQ/picnic area, children's play area, fitness center,          
controlled gated access and perimeter fencing. There are 142 one-bedroom units  
and 87 two-bedroom units. The apartment units have an average size of 1,021     
square feet. The community was constructed in 1984.                             

The purchase price for the community was $16,031,347, paid as follows:          
(i) $15,200,000 to the unaffiliated seller; and (ii) $831,347 in customary      
closing costs. The closing occurred on September 15, 2005, and the purchase     
price was funded by a combination of first mortgage debt and borrowings on a    
loan from Wachovia Bank, National Association. In addition, in accordance with  
the terms of the Company's lending agreement, our Company has established a     
repair escrow fund by depositing $1,600,000 in a repair escrow deposit with the 
lender. The repair escrow deposit will be used for the purpose of paying the    
costs of renovation to the property. The independently appraised value of the   
community at the time of closing was $15,400,000 prior to the renovation and    
$17,550,000 after the renovation. With current first mortgage debt in the       
principal amount of approximately $11,981,000, the community's loan-to-value    
ratio is 67.57%. We will only be liable to the community and its creditors up to
the amount of our initial capital in the community.                             

The property manager is Alliance Residential LLC, which is affiliated with      
Alliance G.P. IV, INC. and Broadstone Preston Alliance LLC. Alliance            
Residential, LLC has managed the community since its acquisition and receives a 
property management fee equal to 3.5% of gross income (with 0.5% of such        
management fee subordinated to the first mortgage lender). Alliance Residential,
LLC does not currently manage communities not owned by us that compete with our 
communities in the Plano market, but there is no assurance that Alliance        
Residential, LLC will not compete with us in the Plano market in the future.    

A renovation and repositioning of the property commenced shortly after the      
closing of the permanent mortgage financing with Deutsche Bank Berkshire        
Mortgage, Inc. The renovation plan includes site landscaping improvements,      
upgrades to the leasing center and the fitness center, kitchen and bathroom     
cabinet painting and refacing and resurfacing of the counter tops, upgrades to  
kitchen and bathroom hardware and lighting, new appliances in a number of units,
carpet replacement in all units, new linoleum in the kitchens and the bathrooms 
in all units, resurfacing of the                                                

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ceilings in all units, general exterior upgrades, and the addition of 20 garages
and 10 storage units.                                                           

All of the leased space is residential with leases ranging from an initial term 
of six months to one year. The average historical occupancy rate for the last   
five years is as follows:                                                       

                                                                [Download Table]

                             Year End December 31,                             
-------------------------------------------------------------------------------
        2001                2002           2003          2004          2005    
        ----                ----           ----          ----          ----    
                                                                               
    Not Available            94%            94%           95%           95%    

As of December 31, 2005, the occupancy rate was 89% (for units under renovation)
and 90% (for units on line).                                                    

The average effective annual rental per unit for each of the last five years is 
as follows:                                                                     

                                                                [Download Table]

    2001                2002           2003          2004          2005    
    ----                ----           ----          ----          ----    
                                                                           
Not Available        $9,070/unit    $8,571/unit   $8,304/unit   $8,342/unit

As shown above, the effective annual rental rate has decreased slightly over the
past few years. The decrease has occurred because the local multifamily         
apartment market weakened due to a weakening in the national economy and lower  
interest rates, which enabled more potential tenants to move into single family 
homes, resulting in a need to offer rent concessions in order to maintain the   
occupancy rate. The property was purchased with a plan to renovate and          
reposition it and it is management's belief that, as the national economy and   
the local multifamily apartment market strengthens, which appears to be         
occurring based on current occupancy rates, and the renovation and repositioning
of the property is completed, the annual rental rate per unit will increase.    

The community is located in the West Plano submarket of Plano, Texas, an area   
which has historically had a high median income ($121,581 currently) and        
relatively low residential vacancy rates (averaging 7.0% in 2005 versus 8.2% for
the Dallas Metro Area).                                                         

- The Plano community is located on Preston Rd., at the intersection of Highland
Drive and Preston Rd. The neighborhood is a mixture of mature multifamily   
developments, a wide range of commercial-retail properties and single-family
home subdivisions. Proceeding north on Preston Rd. are mature multifamily   
  properties in good condition, single-family homes, retail centers, and H. Ross
  Perot's Legacy Business Park. Immediately south of the site is Highland Drive.
Across Highland Drive is Preston Park Colonnade, a retail center with       
Barnes & Noble, Whole Foods Market, and typical neighborhood shops. Further 
south, about a                                                              

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  half-mile, is the entrance to the Preston Park Village. Its 60 specialty shops
 include Ann Taylor, Talbots, St. Johns and The Gap. Across Preston Rd. to the
east is Bristlecone Apartments, a 268-unit property. To the west of the site
 is Ventura Drive. A single-family subdivision of homes, with resale prices in
  the high $400,000 and low $500,000 is situated at Ventura and Highland Drives.
  To the north of the subdivision is Centennial Elementary School. Additionally,
  Preston Road intersects with the George Bush Turnpike about 2.5 miles south of
the property and with State Highway 121 about 3.5 miles to the north.       

- On Preston Rd., directly north and adjacent to the Plano community are the La 
 Ventura Apartments. Constructed in 1999, this 298 unit property is similar to
 the Plano community in terms of both unit mix and unit size. Directly east of
the Plano community is Bristelcone Apartments, consisting of 239 apartments 
that were constructed in 1991. Less than one mile south from the Plano      
community, on Preston Rd., is Summers Crossing Apartments, a 282 unit       
 community that was constructed in 1985. About one-half mile east of the Plano
community is Highlands at Preston Apartments, consisting of 213 units that  
were constructed in 1986. All of these properties have similar amenities to 
those found at the Plano community and they all share a common attribute of 
multifamily developments in the area, mature landscaping and park-like      
settings.                                                                   

To continue to compete well with these properties, management will implement an 
aggressive marketing campaign. We have also budgeted funds for a renovation     
plan, which will increase exterior curb appeal and provided upgrades to the     
interior of the apartment units. We anticipate that this strategy along with the
strong demand for multifamily housing should keep Broadstone Preston at Willow  
Bend Apartments competitive in the market.                                      

Property Management 

Selection of Managers 

The selection of property managers by our advisor, as approved by our board of  
directors, will be based on management capability. We intend to enter into      
property management agreements only with managers having substantial prior      
experience in the operation of apartment communities, who may also manage       
competing communities in the same geographic area. We plan to engage property   
managers that are not affiliated with our Company or our advisor. The managers  
of the communities we currently own interests in meet these criteria and the    
further standards described in items 1 through 5 below. All of our current      
property management agreements are the result of arm's-length negotiations.     

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The property management agent for the Portland, Salt Lake City and Seattle      
Communities is Pinnacle Realty Management Company, which is affiliated with GFS 
Equity Management LLC. Pinnacle has managed these communities since their       
acquisition and receives a property management fee equal to 3.5% to 4.0% of     
gross income. Pinnacle also manages communities not owned by us that compete    
with our communities. We are not aware that either Pinnacle Realty Management   
Company or GFS Equity Management LLC or any of their affiliates own any of the  
competing communities.                                                          

The property management agent for the Jacksonville communities is Bainbridge    
Management Jacksonville LLC, which is affiliated with Bainbridge Jacksonville   
LLC. Bainbridge has managed these communities since their acquisition and       
receives a property management fee equal to 3.5% of gross income.               

The property management agent for our Plano community is Alliance Residential,  
LLC, which is affiliated with Alliance G.P. IV, Inc. and Broadstone Preston     
Alliance LLC. Alliance has managed the community since its inception and        
receives a property management fee equal to 3.5% of gross income with 0.5% of   
such management fee subordinated to the first mortgage lender.                  

While we have no present plans to do so, we may in the future engage affiliates 
as property managers if a majority of our directors, including a majority of our
independent directors, approve the transaction as being fair and reasonable to  
our Company and on terms and conditions not less favorable to us than those     
available from an unaffiliated third party.                                     

While we have no present plans to do so, we may in the future decide to perform 
the property management function ourselves.                                     

Property Management Agreements and Plans

In acquiring interests in apartment communities, our advisor will use its best  
efforts to obtain favorable terms and will apply the following minimum standards
to property management agreements, management plans and marketing plans.        

   - The property manager is considered by our advisor to possess suitable and
substantial multifamily experience.                                 

   - The form of property management agreement is considered by our advisor to
   meet the standards required for successful management of the community.

- The management and marketing plans are considered by our advisor to be
     comprehensive and appropriate to the apartment community and its targeted
resident base.                                                      

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1.  Substantial multifamily experience includes knowledge of the geographic area
  and experience in managing properties that target a similar resident base.
 Our advisor must consider the apartment community's management agreement,
management plan and marketing plan to be appropriate to households like 
those targeted for the community.                                       

2.  Having applied the following guidelines, our advisor must determine that the
property manager possesses the experience and knowledge required for the
successful management of the community:                                 

   - Properties managed by the property manager are well maintained and employ
knowledgeable and competent on-site personnel;                      

  - Effective written policies and procedures are used in lease-up marketing
    and promotion, qualifying prospective residents, maintaining records and
books of account, training and supervising on-site staff, performing
  building and grounds maintenance and serving the needs of the targeted
resident base;                                                      

- The property manager maintains a central office with highly qualified 
personnel that regularly oversee on-site operations and provide     
  professional training, seminars and assistance for site-located staff;

- The property manager has in place a comprehensive system for reporting
physical and economic occupancy on a regular basis;                 

- An effective financial accounting system is maintained with a chart of
     accounts, and a reporting system that provides monthly ledgers, registers
   and operating statements of budgets, actual and variances. The property
    manager maintains a resident record system that contains necessary forms
      and documentation required for internal and external review and audit; and

- The property manager demonstrates the skill and experience required to
 maintain effective resident relations, manage and facilitate programs
      suitable for the targeted resident base, and provide the support necessary
for special resident services where applicable.                     

3.  Having applied the following guidelines, our advisor must determine that the
form of property management agreement meets the standards required for  
successful management of the property:                                  

    - The property management agreement will generally be limited to a period of
one year;                                                           

- Compensation is in the 3% to 5% range unless circumstances (size of   
property, special needs households, etc.) justify an exception;     

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 - The property manager is responsible for securing and renewing liability
insurance at limits established by our advisor;                     

  - The property manager is responsible for compliance with Fair Housing and
other pertinent regulatory requirements;                            

- The property manager is responsible for maintaining financial records 
suitable for annual audit and tax accounting;                       

 - The property manager carries a fidelity bond to insure against employee
   theft that covers an amount of at least two months of rent collections;

  - The agreement provides for the preparation of an annual budget, periodic
reporting, owner approvals, and property manager expenditure limits;

- Relationships with affiliates are acceptable to our advisor as long as
they are disclosed at the outset;                                   

 - Our advisor is satisfied with the designation of the number and type of
      apartments and non-revenue rent arrangements provided for employees of the
property manager; and                                               

- All site staff are employees of the management company and not of the 
controlling owner entity or our Company.                            

4.  Our advisor must determine that the form of management plan is comprehensive
and includes the following:                                             

- There are descriptions of the property manager's role and lines of    
      authority, staffing qualifications and responsibilities, job descriptions,
     personnel practices, hiring practices, staff training, hours of operation
and operating procedures;                                           

  - The property manager provides each of its on-site personnel with written
procedures, forms and personnel manuals;                            

 - All on-site personnel are provided in-house training and participate in
training seminars;                                                  

  - Bookkeeping and accounting records are prepared at the site location and
with oversight and review at the home office;                       

 - The plan details the property manager's maintenance and repair program,
   rent collection procedures, resident services and management relations;
and                                                                 

- The accounting and financial management procedures describe resident  
accounts, record keeping, procurement responsibilities and threshold
   limits, maintaining of separate bank accounts for security deposits and
resident rents, and detained reporting requirements.                

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5.  Having applied the following guidelines, our advisor must determine that the
form of marketing plan is comprehensive and includes the following:     

- The use of professionally designed media advertising, press releases, 
Yellow Page listings, apartment guides, direct mail, brochures and  
signage;                                                            

- Professionally prepared display advertising scheduled for insertion in
regional and local newspapers;                                      

   - Grand opening promotional events and resident referral programs developed
to promote awareness within the targeted market areas;              

   - Lead generation and outreach efforts using an extensive list of employers
      of prospective residents and agencies and organizations including Chambers
  of Commerce, schools, churches, service organizations and neighborhood
social and recreational centers; and                                

- A description of the marketing practices that are to be used following
  stabilization including a sufficient number of trained on-site staff a
     leasing office open seven days a week with hours of operation appropriate
for the area and for the targeted resident base.                    

Property Development and Construction 

We may in the future invest in properties on which improvements are to be       
constructed or completed. When we conclude it is necessary to help ensure       
performance by the builders of properties which are under construction,         
completion of properties under construction will be guaranteed at the price     
contracted either by an adequate completion bond or performance bond. Our       
advisor may rely upon the substantial net worth of the contractor or developer  
or a personal guarantee accompanied by financial statements showing a           
substantial net worth provided by an affiliate of the person entering into the  
construction or development contract as an alternative to a completion bond or  
performance bond. Development of real estate properties is subject to risks     
relating to a builder's ability to control construction costs or to build in    
conformity with plans, specifications and timetables. (See "Risk Factors--Risks 
Related to Our Properties and Our Business.")                                   

We or our advisor may employ one or more project managers to plan, supervise and
implement the development of any unimproved properties which we may acquire.    
Such persons would be compensated directly or indirectly by us.                 

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Joint Venture Investments 

Our advisor has the authority to cause us to enter into joint ventures, general 
partnerships, co-tenancies and other participations with real estate developers,
owners and others for the purpose of developing, owning and operating real      
properties. We generally intend to structure our investments in apartment       
communities as equity investments in the partnerships or limited liability      
companies that own the communities. A description of these arrangements with    
respect to each community in which we currently have an interest is contained in
the section "Business and Properties--Properties" in this prospectus. While we  
have no present plans to do so, we may also enter into joint ventures with      
affiliated entities for the acquisition, development or improvement of          
properties.                                                                     

If we enter into joint ventures with other affiliated programs for the          
acquisition of properties, we will only do so provided that:                    

- a majority of our directors, including a majority of the independent          
directors, approve the transaction as being fair and reasonable to our      
Company;                                                                    

- the investment by our Company and such affiliate are on substantially the same
terms and conditions; and                                                   

- we will have a right of first refusal to buy if such co-venturer elects to    
sell its interest in the property held by the joint venture.                

In the event that a co-venturer were to elect to sell property held in any joint
venture in which we have a right of first refusal to buy, however, we may not   
have sufficient funds to exercise our right of first refusal to buy the other   
co-venturer's interest in the property held by the joint venture. In the event  
that any joint venture holds interests in more than one property, the interest  
in each such property may be specially allocated based upon the respective      
proportion of funds invested by each co-venturer in each such property. Entering
into joint ventures with other affiliated programs will result in certain       
conflicts of interest. (See "Conflicts of lnterest--Joint Ventures with         
Affiliates of Our Advisor.")                                                    

Competition 

We intend to acquire interests in apartment communities in the United States    
wherever suitable communities are identified by our advisor. We will compete    
with many other REITs, real estate partnerships, real estate operating companies
and other investors, including banks and insurance companies, many of which will
have greater financial resources than our Company, in the acquisition and       
operation of apartment communities. All of our apartment communities will be    
located in developed areas that include other multifamily residential           
properties. The number of competitive properties in a particular area could have
a material effect on our                                                        

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ability to lease units at our apartment communities and on the rents charged at 
the properties. While there are no dominant competitors in the industry, the    
market for acquiring apartment communities in the United States is extensive and
local in nature. We may be competing with other entities that have greater      
resources than ours, including several with national portfolios valued at       
billions of dollars, and whose managers may have more experience than ours. In  
addition, other forms of housing, including manufactured housing community      
properties and single-family housing provide alternatives to potential residents
of multifamily residential properties. We will seek to grow by acquiring        
apartment communities in selected targeted markets. We intend to compete for the
acquisition of properties by identifying opportunities that other competitors do
not appreciate and by offering the highest acquisition price possible within the
parameters of our investment objectives and policies. We cannot predict how     
successful we will be in identifying and acquiring suitable apartment           
communities. In particular, we seek opportunities to add value through          
renovation and rehabilitation projects. Our presence in metropolitan areas in   
Florida, Utah, Texas and the northwest United States gives our initial portfolio
geographic diversity while providing us with a competitive advantage in         
identifying and competing for acquisition and development opportunities in those
target markets. We believe our management structure and our strategy of         
employing seasoned local property managers will allow us to grow in both our    
existing markets and in selected new markets without incurring substantial      
additional costs. Our strategy of providing a subordinated economic interest to 
established local operators also may give us a competitive advantage over buyers
that may not provide such an incentive.                                         

Offices 

We maintain our principal office in space leased by Boston Capital Holdings     
Limited Partnership, the parent of our advisor, at One Boston Place, Suite 2100,
in downtown Boston, Massachusetts. We do not pay rent for this space, although  
our advisory services agreement with our advisor takes our advisor's space costs
into consideration.                                                             

Line of Credit

We have entered into an initial non-recourse loan agreement and a related pledge
agreement with BCP Funding, LLC, our affiliate and an affiliate of our advisor. 
These agreements have been approved by a majority of our independent directors. 
We have borrowed approximately $56,596,665 under our loan agreement to acquire  
our interests in our initial ten communities. Generally, interest on the loans  
accrues in arrears at an annual                                                 

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base rate of 9.5% plus bonus interest at 5.3% to the extent of cash available   
for debt service after payment of base interest, and is due and payable         
quarterly to the extent of cash available for debt service for that quarter and,
to the extent not paid, will be added to principal. Further, bonus interest on  
the loans is due and payable quarterly only to the extent of cash available for 
debt service for that quarter after payment of 9.5% interest for that quarter,  
and to the extent not paid will accrue but will not be added to principal or be 
considered in calculating the base 9.5% interest. Accrued bonus interest will be
payable quarterly without further interest to the extent of cash available for  
debt service for that quarter only after payment of base interest and bonus     
interest for that quarter. In return for our affiliate line of credit being     
nonrecourse to the Company, we agreed to pay bonus interest solely from cash    
available in debt service for the communities prior to the repayment of our     
affiliate line of credit attributable to each community. Until our affiliate    
line of credit attributable to each community is repaid by the due date,        
including any extensions, effectively all cash flow generated by such community 
will be paid to BCP Funding, LLC. Each time a closing under this offering occurs
during the term of the loan agreement, we must apply the offering proceeds to   
the repayment of outstanding loan principal and any unpaid base interest. All   
outstanding bonus interest is also due and payable at each closing, but only to 
the extent of cash available for debt service and not from the proceeds of this 
offering. In any event, all outstanding amounts under the loan agreement are due
and payable on January 1, 2007, but if we do not have sufficient cash available 
for debt service to pay all accrued additional interest, the unpaid balance of  
the additional interest will not be due or payable by us.                       

Initially, loans made under the loan agreement are secured by all our interests 
in the communities financed with our affiliate line of credit, and by the 20,000
shares of our common stock owned by Boston Capital Companion Limited            
Partnership, and are non-recourse to our Company. If we repay the advances used 
to acquire our interest in an apartment community and accrued 9.5% interest     
using the proceeds of a closing under this offering, the lender will release its
lien on our interest in that apartment community. Cash distributions from       
released apartment communities will no longer be available to the lender for    
debt service. The loan agreement provides that we cannot further encumber our   
interests in our properties during the term of the agreement without the        
lender's consent.                                                               

The advances we have received under the loan agreement and the uses we have made
of those funds are described above in the "Business and Properties--Properties" 
section of this prospectus.                                                     

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Wachovia Loan 

We entered into a $5,556,348 loan with Wachovia Bank, National Association to   
fund a portion of the purchase price of our Plano community . The interest on   
the loan accrues in arrears at an interest rate of, at our election, LIBOR plus 
300 basis points per annum or Wachovia Bank, National Association's announced   
prime rate plus 150 basis points per annum and is due and payable monthly to the
extent that distributions are received from us by BC Broadstone Preston, LP,    
and, to the extent the interest is not paid, will be added to principal. The    
loan matures on July 3, 2006 and is pre-payable at any time without fee subject 
to LIBOR breakage costs. We may extend the maturity date for an additional      
period through January 1, 2007 provided no default or event of default shall    
then be in existence under the loan agreement; we pay an extension fee equal to 
42 basis points of the outstanding balance of the loan as of July 3, 2006; and  
we provide written notice to Wachovia of our request for an extension of the    
maturity date no later than June 3, 2006. In connection with our procurement of 
the Wachovia loan, BCP Funding, LLC agreed that it will continue to receive     
payment on our outstanding borrowings under our affiliate line of credit with   
respect to our existing properties until all liens on such properties, other    
than the lien associated with our Seattle communities, are released. Once all   
liens on our existing properties (with the exception of the lien associated with
the Seattle communities) are released, BCP Funding, LLC has agreed that we may  
utilize proceeds from this offering to pay the Wachovia loan before the payment 
of the borrowings associated with the Seattle communities.                      

Mortgage Indebtedness 

To date, all the apartment communities in which we have invested are encumbered 
with mortgage indebtedness. These mortgages are described above in the "Business
and Properties--Properties" section of this prospectus. We expect all apartment 
communities we invest in to be similarly encumbered. In addition to permanent   
mortgage financing, the Seattle communities are encumbered by second mortgage   
debt in the original principal amount of $8,120,000 (of which $7,987,418 was    
outstanding at December 31, 2005) bearing interest at 12% subordinated to the   
permanent mortgage financing on those communities. Assuming sufficient          
additional funds are raised, a portion of the proceeds of this offering will be 
used to repay this second mortgage debt. However, we have the right to make     
payments on the Wachovia loan before repaying the borrowings associated with our
Seattle communities. The second mortgage debt matures on December 31, 2007, and 
can be repaid with no penalty. The lender is an unaffiliated third party,       
Berkshire/WAFRA Mezzanine Debt Investors Foreign Fund.                          

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SELECTED FINANCIAL DATA 

The information set forth below presents selected financial data of our Company 
for the year ended December 31, 2005 and the year ended December 31, 2004 and of
our Company's predecessor for the period ended May 15, 2003, and the period     
ended December 31, 2002. Additional detailed financial information is set forth 
in the audited financial statements beginning on page F-1 of this prospectus.   

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Consolidated Financial Information
(Dollars in thousands except property and per share data) 

                                                        [Enlarge/Download Table]

                           Boston Capital Real Estate Investment Trust, Inc.        BCMR Seattle Inc.     
                                   (successor to BCMR Seattle Inc.)                   (predecessor)       
                          ---------------------------------------------------  ---------------------------
                                                                                 Period                   
                                                                  Period       January 1,                 
                                                               May 15, 2003       2003          Period    
                                                                 (date of        through      November 1, 
                                                                inception)       May 15,     2002 (date of
                                                                  through      2003 (date     inception)  
                            Year Ended        Year ended       December 31,        of           through   
                           December 31,      December 31,          2003*       cessation)*   December 31, 
                               2005              2004           (Restated)     (Restated)        2002     
                          ---------------   ---------------   ---------------  -----------   -------------
                                                                                                          
OPERATING DATA:                                                                                           
Revenue:                                                                                                  
Rental and other                                                                                          
  income.................     $ 24,061          $ 21,257          $ 13,187        $2,772*       $   338   
                              --------          --------          --------        ------        -------   
Expenses:                                                                                                 
Operating Costs..........       19,660            17,608            12,143         1,607            354   
Interest (net of                                                                                          
  income)................       11,698            11,487             6,723         1,028*           122   
                              --------          --------          --------        ------        -------   
Total expenses...........       31,358            29,095            18,866         2,635            476   
                              --------          --------          --------        ------        -------   
Loss before income taxes                                                                                  
  and minority                                                                                            
  interest...............       (7,297)           (7,838)           (5,679)          137           (138)  
Benefit from (provision                                                                                   
  for) income taxes......           --                --                --           (53)            53   
Loss attributed to                                                                                        
  minority interest......           (6)               --                --            --             --   
                              --------          --------          --------        ------        -------   
Net Loss.................     $ (7,291)         $ (7,838)         $ (5,679)       $   84        $   (85)  
                              ========          ========          ========        ======        =======   
Loss per share...........     $   (365)         $   (392)         $   (284)       $   --        $    --   
                              ========          ========          ========        ======        =======   
Cash dividends declared                                                                                   
  per share..............     $     --          $     --          $     --        $   --        $    --   
                              ========          ========          ========        ======        =======   

BALANCE SHEET DATA:                                                                                       
Real estate, before                                                                                       
  accumulated                                                                                             
  depreciation...........     $186,852          $169,367          $163,505        $   --        $53,016   
Real estate, after                                                                                        
  accumulated                                                                                             
  depreciation...........     $173,712          $161,803          $160,610        $   --        $52,968   
Total assets.............     $183,653          $168,679          $176,101        $   --        $55,395   
Total liabilities........     $204,094          $181,996*         $181,580        $   --        $46,153   
Minority interest........     $    167          $     --          $     --        $   --        $    --   
Stockholder's equity                                                                                      
  (deficit)..............     $(20,608)         $(13,317)*        $ (5,479)       $   --        $ 9,242   

                                                        [Enlarge/Download Table]

                           Boston Capital Real Estate Investment Trust, Inc.      BCMR Seattle Inc.   
                                   (successor to BCMR Seattle Inc.)                 (predecessor)     
                          ---------------------------------------------------  -----------------------
                                                                                                      
OTHER DATA:                                                                                           
Total properties.........           11                10                10          --             4  
Total apartment units....        3,098             2,869             2,869          --           802  

Cash flow                                                                                             
Operating activities.....     $  1,091          $ (3,053)         $  1,581      $   86       $  (416) 
Investing activities.....     $(18,072)         $  3,408          $   (534)     $9,213       $(8,105) 
Financing activities.....     $ 17,552          $   (409)         $     65      $(9,326)     $ 8,546  

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

*   See note B of each respective financial statement                           

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 

You should read the following discussion in conjunction with the financial      
information on our apartment communities, our financial statements and related  
notes appearing elsewhere in this prospectus and in any supplement.             

OVERVIEW                                                                        

We were formed on May 2, 2003, and have a limited operating history. Our        
operations consist of acquiring, managing and operating apartment communities in
the United States. All but one of our apartment communities has been purchased  
with funds from our affiliate line of credit described below. Once we sell      
enough shares in this offering to repay the amount we have borrowed under our   
affiliate line of credit to acquire our interest in our ten initial communities,
we will experience a relative increase in liquidity, and a relative decrease in 
liquidity as we use the net offering proceeds for the continued acquisition,    
development and operation of apartment communities.                             

We expect that we will acquire properties by paying the entire purchase price of
each property in cash or equity securities, or a combination thereof, and the   
remainder with permanent mortgage financing which will encumber all or certain  
properties. Though we have no current plans to do so, if our directors deem it  
advisable, we may take additional loans on all or certain communities, if       
favorable terms are available, and use the proceeds from such loans to acquire  
additional properties or increase cash flow. In the event that this offering is 
not fully sold, our ability to diversify our investments may be diminished.     

We expect to elect to be taxed as a REIT beginning with the tax year ended      
December 31, 2005. We believe that we are organized in conformity with the      
requirements for taxation as a REIT for federal income taxes, but cannot assure 
you that we will meet such requirements. If we fail to meet these requirements, 
our distributions will not be deductible to us and we will have to pay a        
corporate level tax on our income. This would substantially reduce our cash     
available to pay dividends. In addition, such a tax liability might cause us to 
borrow funds, liquidate some of our investments or take other steps which could 
negatively affect our operating results. Moreover, if our REIT status is        
terminated because of our failure to meet a technical REIT requirement or if we 
voluntarily revoke our election, we would generally be disqualified from        
electing treatment as a REIT for the four taxable years following the year in   
which REIT status is lost.                                                      

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Trends Which May Influence Our Results of Operations

Increasing Demand for Rental Apartments                                         

Based on certain demographic trends, in particular, the growth of the "Echo     
Boomer" generation, we believe we are well-positioned to continue achieving our 
objectives. While there is no guarantee that individuals making up this group   
will choose renting versus ownership, we believe the increase in this age group 
will have a positive demand for the number of rental households. Echo Boomers   
are now entering into the age group having the greatest propensity to rent. As  
shown in the chart below, the number of individuals between the ages of 18-39 is
expected to grow significantly over the next 20 years.                          

U.S. Population of Individuals between the Ages of 18-39

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC                     

                                                                [Download Table]
                
2005  89,625,000
2006  90,046,000
2007  90,649,000
2008  91,374,000
2009  91,971,000
2010  92,264,000
2011  92,567,000
2012  93,011,000
2013  93,576,000
2014  94,168,000
2015  94,595,000
2016  95,054,000
2017  95,480,000
2018  95,864,000
2019  96,296,000
2020  96,547,000
2021  96,777,000
2022  97,095,000
2023  97,467,000
2024  97,919,000
2025  98,371,000

SOURCE: U.S. CENSUS BUREAU, POPULATION PROJECTIONS BRANCH, MAY 2004.            

Strong Demand Due to Interest Rate Environment                                  

The 40-year historic lows reached on mortgage interest rates in recent years    
provided some individuals with the opportunity to purchase homes at similar     
costs to renting, particularly when utilizing short-term variable mortgages.    
However, with the more recent increases in interest rates, this attractive      
alternative may have faded for some and the apartment sector is in a position to
reap the benefits. If a higher interest rate environment continues, then the    
number of individuals purchasing homes will typically decline. As rental        
apartments directly compete with the single-family home and condominium sectors 
of the economy, the demand for new and existing rental apartment communities may
rise when demand for purchasing homes falls. We believe this will be beneficial 
for apartment owners as it should translate into greater demand, higher         
occupancy rates,                                                                

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fewer concessions needed to attract renters, and therefore increased            
profitability of our apartment communities.                                     

Increased Income and Distributions Due to Healthy U.S. Economy                  

Generally, healthy employment in a particular market area enables apartment     
owners to increase rents charged to tenants. As employment across locations in  
which we own apartment communities continues to improve and stabilize, apartment
owners in these locations should be able to increase rents ahead of expenses    
which should increase the revenue we receive from our apartment communities. As 
a result, the amount of cash available for distribution to our stockholders     
should increase. However, our actual results of operations and, accordingly,    
cash available for distribution, will be affected by a number of factors,       
including the revenue we receive from our communities, our operating expenses,  
our debt obligations, interest expense, the ability of our residents to meet    
their obligations, and unanticipated expenditures.                              

Liquidity and Capital Resources 

It is anticipated that our primary source of funds will be the proceeds of this 
offering. Potential future sources of liquidity include (i) cash distributions  
from investments in real estate; (ii) interest earned on capital raised and held
pending investment; (iii) proceeds from secured or unsecured financing,         
including from banks; and (iv) undistributed funds.                             

We intend to purchase, or enter into binding commitments to purchase, interests 
in certain apartment communities prior to the completion of this offering,      
provided we have raised sufficient funds to pay off our affiliate line of credit
and the Wachovia loan. Properties acquired as of December 31, 2005 were         
purchased with financing obtained on our affiliate line of credit, mortgage     
notes payable and through a bank note.                                          

During the years ended December 31, 2005 and 2004, we generated net cash flows  
of $5.4 million and $4.5 million, respectively, from the properties, all of     
which was used to pay interest, or will be used to pay accrued interest on our  
affiliate line of credit. Although there can be no assurances, we believe we    
will raise sufficient proceeds from this offering to repay all or a portion of  
our affiliate line of credit which matures on January 1, 2007. In addition, we  
believe that a combination of our efforts to increase rental revenue and contain
operating costs at our apartment communities and our ability to extend the      
maturity date of our Wachovia loan and defer certain discretionary capital      
improvements and payments to affiliates until January 2007 will be sufficient to
meet our operating, debt service and other working capital needs for the next   
year.                                                                           

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Our cash and cash equivalents balance increased approximately $.6 million from  
approximately $1.0 million at January 1, 2005 to $1.6 million at December 31,   
2005. All cash and cash equivalents are held in money market or checking        
accounts. The major factors affecting our cash flows are as follows:            

- The results from the operation of the communities provided net cash flow from 
operating activities of $1.1 million.                                       

- We expended $15.8 million on the purchase of land, building, furniture        
fixtures and equipment, intangible assets and acquisition costs of our Plano
community. We also expended $1.9 million on building and improvements and   
replacement of furniture, fixture and equipment at our existing communities.

- We funded $1.7 million into restricted cash for our Plano community and       
expended $1.3 million of our existing community restricted cash for building
improvements, replacement of furniture, fixtures and equipment and interest 
payments on our affiliate line of credit.                                   

- We received bridge note financing of $12.0 million, additional mortgage       
financing of $12.0 million and other note financing of $5.6 million to      
purchase and refinance our Plano community.                                 

- We repaid $12.0 million of bridge financing obtained for the purchase of our  
Plano.                                                                      

- We increased due to related party by $2.0 million for costs that did not flow 
through operations and expended $1.8 million of the amount on deferred      
offering costs.                                                             

AFFILIATE LINE OF CREDIT                                                        

We have a $60 million line of credit with an affiliate which is also an         
affiliate of our advisor. The line bears "base" interest at 9.5% and "bonus"    
interest at 5.3% and originally matured on May 31, 2004 with the option of a    
six-month extension, which we exercised. On September 1, 2004, we were granted  
an extension through May 31, 2005. On March 11, 2005, we were granted an        
extension through January 1, 2006. On December 15, 2005, we were granted an     
extension through January 1, 2007. Base interest is due and payable with respect
to each calendar quarter to the extent of cash available for debt service for   
the current quarter. Base interest shall accrue in arrears and any unpaid base  
interest shall accrue and be added to principal. Bonus interest is due and      
payable with respect to each calendar quarter to the extent of cash available   
for debt service after payment of base interest. Any unpaid bonus interest shall
accrue but will                                                                 

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not be added to principal. Accrued bonus interest shall be payable quarterly    
solely from cash available for debt service after payment of the current quarter
base and bonus interest. Any accrued bonus interest not paid on or before the   
maturity date shall not be due or payable. We do not believe that sufficient    
cash flow will exist to pay bonus interest; therefore no accrual for it has been
made in our financial statements. The affiliate line of credit is secured by our
interests in our Seattle, Jacksonville, and Portland communities and the        
outstanding shares of the Company. As of December 31, 2005, $56.6 million was   
outstanding on our affiliate line of credit. During the years ended             
December 2005 and 2004, base interest of $5.4 million and $5.5 million,         
respectively, was incurred and $.4 million remains payable as of December 31,   
2005. If the amount of capital raised during the offering is not sufficient to  
pay the outstanding balance under our affiliate line of credit, we could lose   
our interest in some or all of our properties.                                  

There is no guarantee that this offering will in fact result in the anticipated 
proceeds.                                                                       

OTHER FINANCING                                                                 

To fund a portion of the purchase price of our Plano community, we borrowed     
$5.6 million from Wachovia Bank, National Association evidenced by a note       
payable. The note is secured by the joint venture interests of certain of our   
subsidiaries and is guaranteed by an affiliate of ours. The note is interest    
only and bears interest at Libor plus 300 basis points (7.37% as of             
December 31, 2005). Interest is payable monthly to the extent that cash flow    
from the Plano community permits, and any unpaid interest accrues. The note     
matures on July 3, 2006. We may extend the maturity date for an additional      
period through January 1, 2007 provided no default or event of default shall    
then be in existence under the loan agreement; we pay an extension fee equal to 
42 basis points of the outstanding balance of the loan as of July 3, 2006; and  
we provide written notice to Wachovia Bank of our request for an extension of   
the maturity date no later than June 3, 2006. As of December 31, 2005 interest  
of $117 thousand was incurred and $6 thousand remained payable. An affiliate has
guaranteed payment and performance of all of the obligations of the investor    
limited partner of the joint venture that owns the Plano community with respect 
to the note with Wachovia Bank. This guarantee is an absolute, unconditional and
continuing guarantee.                                                           

RESULTS OF OPERATIONS                                                           

As of December 31, 2005 and 2004 we owned interests in 11 and 10 properties,    
respectively. Ten of our interests owned as of December 31,                     

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2005 and 2004 are in 3 portfolios and one interest owned as of December 31, 2005
is a single community property. Details on the properties are as follows:       

The Seattle portfolio consists of four apartment communities containing 802     
apartment units as follows:                                                     

                                                                [Download Table]

                                      Occupancy    Occupancy 
                                      Rate as of   Rate as of
Property name                          12/31/05     12/31/04 
-------------                         ----------   ----------
                                                             
Alderwood Park Apartments...........      96%          97%   
Ridgegate Apartments................      91%          97%   
Ridgetop Apartments.................      97%          92%   
Wellington Apartments...............      98%          93%   

The Portland portfolio consists of three apartment communities containing 1,027 
apartment units as follows:                                                     

                                                                [Download Table]

                                      Occupancy    Occupancy 
                                      Rate as of   Rate as of
Property name                          12/31/05     12/31/04 
-------------                         ----------   ----------
                                                             
Boulder Creek Apartments............      97%          89%   
Bridge Creek Apartments.............      97%          87%   
Settler's Point Apartments..........      95%          90%   

The Jacksonville portfolio consists of three apartment communities containing   
1,040 apartment units as follows:                                               

                                                                [Download Table]

                                      Occupancy    Occupancy 
                                      Rate as of   Rate as of
Property name                          12/31/05     12/31/04 
-------------                         ----------   ----------
                                                             
Bay Pointe Apartments...............      93%          93%   
Savannah Oaks (formerly Oaks at                              
  Timuquana Apartments).............      90%          89%   
Spicewood Springs Apartments........      94%          93%   

The Plano community consists of one apartment community containing 229 apartment
units as follows:                                                               

                                                                [Download Table]

                                      Occupancy    Occupancy 
                                      Rate as of   Rate as of
Property name                          12/31/05     12/31/04 
-------------                         ----------   ----------
                                                             
Preston at Willow Bend Apartments...      89%         N/A    

On January 12, 2006 a fire occurred at one of the Portland communities (Bridge  
Creek Apartments) that damaged twelve units. An investigation into the cause of 
the fire was conducted by the fire department and a cause and origin expert     
hired by the insurance company. They concluded that the cause was a weakened    
wire in the wall between two of the                                             

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apartment units. Additionally, it was determined that the weakened wire was not 
caused by negligence on anyone's part. No one was injured and displaced tenants 
were relocated to vacant units within Bridge Creek Apartments and Boulder Creek 
Apartments. The preliminary estimate to repair the damages ranges between       
$400,000 and $600,000, but contractors have begun exploratory demolition to     
better assess the extent of damage and total cost of the repairs. Such costs are
covered by insurance. The insurance deductible is $10,000, and it is anticipated
to be incurred in the second quarter. It is also anticipated that rent loss     
insurance will cover lost rents and incurred expenses.                          

COMPARISON OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2005 TO THE YEAR ENDED 
DECEMBER 31, 2004                                                               

The following summarizes changes in our operations for the years ended          
December 31, 2005 and 2004. Net loss for the year ended December 2005 decreased 
from the same prior period by approximately $.5 million, from $7.8 million to   
$7.3 million, or 6.4%. We acquired the Plano community in September 2005 which  
contained 229 units.                                                            

RENTAL REVENUE                                                                  

Revenues increased approximately $2.7 million, from $21.3 million to            
$24.0 million, or 12.7%, in the current year. The acquisition of our Plano      
community in the current year accounted for $.56 million of the increase.       
Average weekly occupancy rates increased from 2004 to 2005 at each of our       
existing communities. Other significant factors affecting revenue are as        
follows. Collection loss at the three Jacksonville properties, which is charged 
against revenue, increased during 2004. As a result, management changed credit  
reporting agencies and increased credit standard requirements for all new       
tenants. The result has been an improved tenant profile and a reduction in      
collection loss. Additionally, two Jacksonville properties, Bay Pointe          
Apartments and Savannah Oaks Apartments, were acquired with the intention of    
renovating between 53% and 69% of the units, respectively. These renovations    
were completed throughout 2003 and 2004, and all units were back in service by  
the beginning of 2005. These improvements enabled the complexes to increase     
rental rates at Bay Pointe and Savannah Oaks by averages of 4.9% and 8.2%,      
respectively, on the renovated units. Occupancy has stabilized at both apartment
complexes with improved revenues as a result of the increased occupancy and     
higher rental rates. Revenues at Wellington Apartments, in Silverdale, WA also  
improved in the current year due to improved occupancy. In the prior year the   
apartment complex lost 15% of its leases when an aircraft carrier stationed in  
the area departed. In January 2005 another ship                                 

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arrived which enabled the property to stabilize occupancy and increase rental   
rates.                                                                          

PROPERTY OPERATING COSTS                                                        

Property operating costs decreased approximately $.7 million, from $8.6 million 
to $7.9 million, or 8.1%, in the current year. Our Plano community contributed  
an additional $.2 million in operating costs to our net loss in the current     
year. Most of the costs incurred in 2004 that were charged to operations were at
Settler's Point Apartments, in Salt Lake City, UT and were for converting swamp 
coolers to air conditioning, lighting improvements and exterior upgrades.       
Additional costs incurred in 2004 at our Portland and Seattle communities that  
were charged to operations included carpet, flooring and appliance replacement. 

GENERAL AND ADMINISTRATIVE EXPENSES                                             

General and administrative expenses increased approximately $.2 million, from   
$2.9 million to $3.1 million, or 6.9%, in the current year. Our Plano community 
contributed $.07 million to the increase in general and administrative costs in 
the current year. Current year accounting costs and legal expense increased as a
result of additional costs associated with becoming a Public Company registered 
with the Securities and Exchange Commission.                                    

DEPRECIATION AND AMORTIZATION                                                   

Depreciation and amortization expense increased approximately $1.1 million, from
$5.0 million to $6.1 million, or 22.0%, in the current year. Our Plano community
contributed $.17 million to the increase. As described above, capital           
improvements were made at communities in our three portfolios throughout 2004   
and 2005. These improvements are being depreciated over their estimated useful  
lives and have increased depreciation expense accordingly.                      

PORTFOLIO AND MANAGEMENT FEES-RELATED PARTY                                     

There was no material change in related party management fees in the current    
year from the prior year, however there was an increase in property management  
fees of approximately $.4 million that was offset by a decrease in portfolio    
management fees of approximately $.4 million. During the fourth quarter of 2005,
our affiliate entitled to the portfolio management fee waived all future        
portfolio management fees retroactive to January 1, 2005. This resulted in a    
decrease in expense of $.4 million.                                             

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Property management fees are directly tied to rental revenues and accordingly   
are expected to increase with increases in rental income. The property          
management companies are also entitled to incentive management fees when        
distributions available from operations exceed certain predefined returns on our
investment. Operations at the Seattle portfolio that met such criteria in the   
current year exceeded the amount of operations that met such criteria in the    
prior year. The increase in property and incentive management fees in the       
current year was $.4 million, of which $.02 million is attributed to our Plano  
community.                                                                      

ASSET MANAGEMENT FEE-RELATED PARTY                                              

Asset management fee-related party increased to approximately $1.4 million in   
the current year from zero in the prior year. No asset management fees were     
incurred in the prior period since the advisor had waived its right to all asset
management fees from inception through December 31, 2004.                       

INTEREST EXPENSE                                                                

Interest expense increased approximately $.2 million, from $11.5 million to     
$11.7 million, or 1.8%, in the current year. Our Plano community contributed    
$.3 million to the increase in interest expense in the current year.            

COMPARISON OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2004 TO THE PERIOD     
MAY 15, 2003 (INCEPTION) THROUGH DECEMBER 31, 2003                              

The following summarizes changes in our operations for the years ended          
December 31, 2004 and the period May 15, 2003 (inception) through December 31,  
2003. Net loss for the year ended December 2004 increased from the net loss for 
the period May 15, 2003 (inception) through December 31, 2003 approximately     
$2.1 million, from $5.7 million to $7.8 million, or 36.8%. The net loss for the 
year ended December 31, 2004 reflects a full year of operations for all of the  
communities owned as of December 31, 2004. The net loss for the period ended    
December 31, 2003 reflects operations for the communities as of the date that   
they were acquired by us which was approximately 7.5 months. Significant        
differences in the net loss and the following analysis are primarily due to a   
difference in length of ownership of the communities.                           

RENTAL REVENUE                                                                  

Revenues increased by approximately $8.1 million, from $13.2 million to         
$21.3 million, or 61.4%, from the comparative prior period. The December 31,    
2004 total includes twelve months of operations, whereas the                    

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December 31, 2003 data includes only partial year operations of approximately   
7.5 months.                                                                     

PROPERTY OPERATING COSTS                                                        

Operating costs increased by approximately $3.3 million, from $5.3 million to   
$8.6 million, or 62.3%, from the comparative prior period. The December 31, 2004
total includes twelve months of operations, whereas the December 31, 2003 data  
includes only partial year operations of approximately 7.5 months. Additionally,
there were increased maintenance payroll costs in 2004 for costs associated with
renovations and making units ready to occupy.                                   

GENERAL AND ADMINISTRATIVE EXPENSES                                             

General and administrative expenses increased by approximately $1.0 million,    
from $1.9 million to $2.9 million, or 52.6%, from the comparative prior period. 
The December 31, 2004 total includes twelve months of operations, whereas the   
December 31, 2003 data includes only partial year operations of approximately   
7.5 months. Additionally, there were increased administrative payroll costs in  
2004 for additional leasing staff and incentives which were utilized to rent    
renovated apartments as quickly as possible.                                    

DEPRECIATION AND AMORTIZATION                                                   

Depreciation expense increased by approximately $2.4 million, from $2.6 million 
to $5.0 million, or 92.3%, from the comparative prior period. The December 31,  
2004 total includes twelve months of operations, whereas the December 31, 2003  
data includes only partial year operations of approximately 7.5 months.         
Additionally, capital improvements made throughout 2003 and 2004 increased      
depreciation expense in 2004.                                                   

PORTFOLIO AND MANAGEMENT FEES-RELATED PARTY                                     

Related party management fees increased approximately $.3 million, from         
$.9 million to $1.2 million, or 33.3%, from the comparative prior period. The   
December 31, 2004 total includes twelve months of operations, whereas the       
December 31, 2003 total includes only partial year operations of approximately  
7.5 months.                                                                     

ASSET MANAGEMENT FEE-RELATED PARTY                                              

No asset management fees were incurred in either period since our advisor has   
waived its right to all asset management fees from inception through            
December 31, 2004.                                                              

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ORGANIZATION COSTS                                                              

Organization costs decreased by $1.4 million for the period ended December 31,  
2003 to zero for the year ended December 31, 2004. Organization costs are       
expensed as incurred. Organization of the Company and the community portfolios  
was complete as of December 31, 2003. As a result, we did not incur any         
organization costs in the year ended December 31, 2004.                         

INTEREST EXPENSE                                                                

Interest expense increased by approximately $4.8 million, from $6.7 million to  
$11.5 million, or 71.6%, from the comparative prior period. The December 31,    
2004 total includes twelve months of operations for both mortgage and our       
affiliate line of credit interest. The December 31, 2003 total includes only    
partial year operations of approximately 7.5 months of mortgage and our         
affiliate line of credit interest.                                              

OFF-BALANCE SHEET ARRANGEMENTS                                                  

We have no off-balance sheet arrangements that have or are reasonably likely to 
have a current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital      
expenditures or capital resources that are material to investors.               

CONTRACTUAL OBLIGATIONS (DOLLARS IN THOUSANDS)                                  

We pay operating expenses and interest expense from cash generated from property
operations. Below is a summary of our other material obligations by maturity as 
of December 31, 2005 (amounts are in thousands)                                 

                                                                [Download Table]

                       Less than                           More than           
                        1 year     1-3 years   3-5 years    5 years     Total  
                       ---------   ---------   ---------   ---------   --------
                                                                               
Mortgages............   $    61    $ 45,776     $74,707     $11,981    $132,525
Line of Credit.......        --      56,597 a        --          --      56,597
Note Payable.........     5,556 a        --          --          --       5,556
Due to Related                                                                 
  Party..............     4,944 b        --          --          --       4,944
                        -------    --------     -------     -------    --------
Total................   $10,561    $102,373     $74,707     $11,981    $199,622
                        =======    ========     =======     =======    ========

--------                                                                        

a.  It is anticipated that proceeds from the public offering will be used to    
  repay our affiliate line of credit financing and note payable to Wachovia.

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b.  Payments of amounts due to related parties, although currently due, can be  
    deferred until such time as cash from operations or proceeds from our public
offering is sufficient to pay the obligations.                          

CRITICAL ACCOUNTING POLICIES                                                    

In order to prepare our financial statements in conformity with accounting      
principles generally accepted in the United States, we are required to make     
estimates and assumptions that affect the amounts reported in the financial     
statements. On a regular basis, we review these estimates and assumptions,      
including those related to revenue recognition, allocation of purchase price,   
asset lives and depreciation and impairment of long-lived assets. These         
estimates are based on our historical experience and on various other           
assumptions believed to be reasonable under the circumstances. Actual results   
may differ from these estimates under different assumptions or conditions. We   
believe, however, that the estimates, including those for the above-listed      
items, are reasonable. We believe the following critical accounting policies    
involve the most complex, difficult and subjective judgments and estimates used 
in the preparation of these financial statements:                               

REVENUE RECOGNITION                                                             

Tenant leases are classified as operating leases. Rental income attributable to 
leases is recorded when due from tenants and is recognized monthly as it is     
earned, which is not materially different from on a straight-line basis. Leases 
between a tenant and property for the rental of an apartment unit are generally 
year-to-year, renewable upon consent of both parties on an annual or monthly    
basis. Interest income is recorded on an accrual basis.                         

ALLOCATION OF PURCHASE PRICE, ASSET LIVES AND DEPRECIATION                      

The acquisition cost of each apartment community is allocated to various        
property components such as land, buildings and improvements, and furniture,    
fixtures and equipment and each component generally has a different useful life.
Acquisition cost allocations and the determination of the useful lives are based
on our management's estimates, or under some circumstances, studies commissioned
from independent real estate appraisal firms. We allocate the value of real     
estate acquired among land, building and improvements, furniture, fixtures and  
equipment, the value of in-place leases and the fair market value of above or   
below market leases. We compute related depreciation expense using the straight 
line method over estimated useful lives of up to 40 years for buildings, up to  
15 years for building improvements, and up to 5 years for furniture, fixtures   
and equipment. The value of intangible assets is amortized over the life of the 

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respective lease, which is typically one year. The allocated cost of land is not
depreciated. Inappropriate allocation of acquisition costs or incorrect         
estimates of useful lives could result in depreciation and amortization expenses
which do not appropriately reflect the allocation of our capital expenditures   
over future periods required by generally accepted accounting principles.       

IMPAIRMENT OF ASSETS                                                            

We periodically evaluate our apartment communities for impairment indicators.   
These indicators may include weak or declining tenant occupancy, cash flow or   
liquidity, or our decision to dispose of an asset before the end of its         
estimated useful life, and market or industry changes that could permanently    
reduce the value of the related apartment community. If impairment indicators   
are present, we evaluate the carrying value of the related apartment community  
by comparing it to the expected future undiscounted cash flows to be generated  
from that community. If the sum of these expected future cash flows is less than
the carrying value, we reduce the net carrying value of the community to its    
fair value. This analysis requires us to judge whether indicators of impairment 
exist and to estimate likely future cash flows. If we misjudge or estimate      
incorrectly or if future tenant occupancy, market or industry factors differ    
from our expectations, we may record an impairment charge which is inappropriate
or fail to record a charge when we should have done so, or the amount of such   
charges may be inaccurate.                                                      

These policies involve significant judgments based upon our experience,         
including judgments about current valuations, ultimate realizable value,        
estimated useful lives, salvage or residual values, and the current and likely  
future operating and competitive environments in which our apartment communities
are operated. In the future we may need to revise our assessments to incorporate
information which is not now known, and such revisions could increase or        
decrease our depreciation expense.                                              

RECENT ACCOUNTING PRONOUNCEMENTS                                                

In December 2004, the Financial Accounting Standards Board ("FASB") issued SFAS 
No. 123 (revised 2004), "Share-Based Payment" ("SFAS 123R"), which replaces SFAS
No. 123, "Accounting for Stock-Based Compensation" ("SFAS 123") and supersedes  
APB Opinion No. 25, "Accounting for Stock Issued to Employees." SFAS 123R       
requires all share-based payments to employees, including grants of employee    
stock options, to be recognized in the financial statements based on their fair 
values beginning with the first interim or annual period after June 15, 2005.   
Under SFAS 123R, we must determine the appropriate fair value model to be used  
for valuing                                                                     

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share-based payments, the amortization method for compensation cost and the     
transition method to be used at date of adoption. We adopted SFAS 123R in 2005  
and used the Black-Sholes-Merton formula for analysis. SFAS 123R did not have   
any material effect on our financial statements.                                

In June 2005, the FASB ratified the consensus in Emerging Issues Task Force     
("EITF") Issue No. 04-5, "Determining Whether a General Partner, or the General 
Partners as a Group, Controls a Limited Partnership or Similar Entity When the  
Limited Partners Have Certain Rights" ("Issue 04-5"), which provides guidance in
determining whether a general partner controls a limited partnership. Issue 04-5
states that the general partner in a limited partnership is presumed to control 
that limited partnership. The presumption may be overcome if the limited        
partners have either (1) the substantive ability to dissolve the limited        
partnership or otherwise remove the general partners without cause or           
(2) substantive participating rights, which provide the limited partners with   
the ability to effectively participate in significant decisions that would be   
expected to be made in the ordinary course of the limited partnership's business
and thereby preclude the general partner from exercising unilateral control over
the partnership. The adoption of Issue 04-5 by us, which is effective for new or
modified limited partnerships as of June 30, 2005 and all other limited         
partnership arrangements as of January 1, 2006, is not expected to have a       
material effect on the our financial position or results of operations.         

Quantitative and Qualitative Disclosures About Market Risk                      

We had one variable rate loan outstanding as of December 31, 2005 in the amount 
of $5.6 million, which is subject to market risk associated with interest rate  
changes. The remainder of our debt at December 31, 2005 is fixed rate debt. All 
of our long-term debt is fixed rate debt with interest rates ranging from 4.26% 
to 12.0%. Our short term debt is a combination of fixed rate and floating rate  
debt with interest rates ranging from the Libor Index Rate plus 300 basis points
(7.37% at December 31, 2005) to 9.5%. The weighted average interest rate on debt
outstanding at December 31, 2005 and December 31, 2004 was 6.39% and 6.45%,     
respectively. We do not have any derivative investment, direct foreign exchange,
or other market risk. Management estimates that, as of December 31, 2005, a one 
percentage point increase in interest rates on variable rate outstanding debt   
would result in additional annual interest of $.06 million per year. An         

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analysis of the fair market values of the debt held at December 31, 2005 is set 
forth below.                                                                    

                                                        [Enlarge/Download Table]

                                                                         Expected Maturity Date(4)                                 
                                           -------------------------------------------------------------------------------------   
                                                                                                                          Fair     
                                                                                                                         Market    
                                             2006       2007       2008       2009       2010       2014      Total     Value(2)   
                                           --------   --------   --------   --------   --------   --------   --------   --------   
                                                                           (Dollars in millions)                                   
                                                                                                                                   
                      Liabilities                                                                                                  
                      Long Term Debt                                                                                               

Jacksonville......... Fixed Rate ($US)     $      0   $     0    $     0       $0      $35.374    $     0    $35.374    $33.341    
                      Avg. Interest Rate          0%        0%         0%       0%        4.29%         0%        --       5.74%(1)

Seattle.............. Fixed Rate ($US)     $      0   $     0    $37.850       $0      $     0    $     0    $37.850    $37.417    
                      Avg. Interest Rate          0%        0%      4.67%       0%           0%         0%        --       5.75%(1)

Seattle Second                                                                                                                     
Mortgage Loan........ Fixed Rate ($US)     $   .061   $ 7.926    $     0       $0      $     0    $     0    $ 7.987    $  7.98    
                      Avg. Interest Rate         12%       12%         0%       0%           0%         0%        --         12%(1)

Portland/Salt Lake                                                                                                                 
City................. Fixed Rate ($US)     $      0   $     0    $     0       $0      $39.333    $     0    $39.333    $37.862    
                      Avg. Interest Rate          0%        0%         0%       0%        4.58%         0%        --       5.74%(1)

Plano Mortgage                                                                                                                     
Loan................. Fixed Rate ($US)     $      0   $     0    $     0       $0      $     0    $11.981    $11.981    $11.505    
                      Avg. Interest Rate          0%        0%         0%       0%           0%      5.14%        --       5.71%(1)

                      Short Term Debt                                                                                              

Line of Credit....... Fixed Rate ($US)     $      0   $56.597    $     0       $0      $     0    $     0    $56.597    $56.597    
                      Avg. Interest Rate          0%      9.5%         0%       0%           0%         0%        --       9.50%(1)

ALLTX LLC Note....... Floating Rate ($US)  $  5.556   $     0    $     0       $0      $     0    $     0    $ 5.556    $ 5.556    
                      Avg. Interest Rate      Libor         0%         0%       0%           0%         0%        --       7.37%(3)
                                               plus                                                                                
                                           300 bpts                                                                                

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

Notes:                                                                          

(1) Estimated fair value rates represent estimated rates a borrower would       
    receive under current market conditions. The individual estimated fair rates
    were calculated using a treasury rate that coincides with the remaining time
    period on each note. In addition, a conservative spread of 1.0% was added to
 the treasury rates to come up with the estimated fair value rate for each
portfolio.                                                              

(2) Fair Market Value represents the net present value of the debt at the       
  estimate fair value rates. Since the estimated fair value rates are higher
  than the actual interest rates, there is a premium (the difference between
the principal balance and the Fair Market Value) that a potential buyer 
 should pay if he or she were to assume the debt. This is evidenced by the
    lower principal amount that these cash flows support at the higher estimated
   fair value rates. Alternatively, in the event that the estimated fair value
rates were lower than the actual interest rates on these notes, then a  
property buyer assuming the debt would expect to receive a discount,    
calculating Fair Market Value using the methodology shown above.        

(3) Rate based on the Libor rate charged on the interest period December 15,    
2005 through January 15, 2006.                                          

(4) For presentation purposes, only years with actual debt maturities are       
displayed.                                                              

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Related Party Transactions

We have an agreement with our advisor, to originate and present investment      
opportunities to our board of directors and to provide administrative services  
to us. Our advisor is wholly owned by Boston Capital Holdings Limited           
Partnership. John P. Manning, our Chairman and Chief Executive Officer, is the  
general partner of and owns a limited partnership interest in Boston Capital    
Holdings Limited Partnership. Each of our executive officers is also an officer 
of our advisor.                                                                 

For managing the affairs of the REIT, our advisor or its affiliates is          
compensated with a monthly asset management fee equal to 1/12th of .75% of the  
amount invested in communities (including the original principal amount of any  
mortgage indebtedness). Our advisor has waived its right to all asset management
fees from the time of inception though December 31, 2004. As of December 31,    
2005 the accrued and unpaid asset management fees due to our advisor are        
$1,367,915.                                                                     

We have a $60,000,000 line of credit with BCP Funding, LLC, a related party     
which matures on January 1, 2007. Base interest is due and payable with respect 
to each calendar quarter to the extent of cash available for debt service for   
the current quarter. The line of credit also requires bonus interest payments   
provided there is cash available for debt service after payment of the base     
interest on a quarterly basis. Any unpaid bonus interest is accrued, and is only
payable should sufficient cash available for debt service after payment of      
current quarter base interest and bonus interest is generated. As of December   
31, 2005, the accrued bonus interest is $7,831,973. We do not believe that      
sufficient cash flow will exist to pay bonus interest and therefore have not    
recorded a liability on the balance sheet. The line of credit is secured by our 
interests in the Seattle, Jacksonville, and Portland portfolios and our         
outstanding shares. BCP Funding, LLC is also a guarantor of our loans with      
Wachovia National Association, entered into in connection with our acquisition  
of the Plano community. We have agreed to pay BCP Funding, LLC a fee of $100,000
in connection with our agreement with BCP Funding, LLC to extend the maturity   
date of the line of credit from January 1, 2006 to January 1, 2007.             

We have entered into property management agreements with affiliates in          
connection with management of the Seattle, Portland and Jacksonville portfolios.
The property management agreements were for initial one year terms and are      
automatically renewed unless terminated by either party after 30 days notice    
(60 days notice with respect to the Jacksonville portfolio). Fees paid to the   
property manager range from 3.5% to 4.0% of gross income of the respective      
community. During the twelve months ended December 31, 2005 and 2004, property  
management fees of $854,643 and $743,673 were paid to these affiliates and are  
included in                                                                     

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management fees--related party on the consolidated statements of operations.    

During the twelve months ended December 31, 2005 and 2004, excess operating cash
flow distributions of $304,006 and $32,323, respectively, were paid to the      
managing member of the Seattle portfolio under the conditions stated in the     
partnership agreement. These payments are shown as management fees--related     
party on the consolidated statements of operations.                             

During the twelve months ended December 31, 2004, an affiliate of ours earned   
portfolio management fees of $407,912 in connection with management of the      
Seattle, Portland and Jacksonville portfolios. The fee is based on .25% of total
development costs, defined as total equity investment and the amount of the     
original mortgage payable for each portfolio. The affiliate has agreed to waive 
all future portfolio management fees retroactive to January 1, 2005. As of      
December 31, 2005, $530,623 of prior year fees remained payable and was included
in due to related party on the consolidated balance sheets.                     

During the twelve months ended December 31, 2005 and 2004, an affiliate of ours 
paid or advanced funds to pay $2,775,737 and $823,136, respectively, for various
costs associated with our operation.                                            

MANAGEMENT

General 

We will operate under the direction of our board of directors, the members of   
which are accountable to our Company as fiduciaries. The regulations of the     
North American Securities Administrators Association require review and         
ratification of our articles of incorporation by a majority vote of our         
directors and of our independent directors. All of our directors have reviewed  
and ratified our articles of incorporation and have adopted our bylaws. Our     
board of directors will be responsible for the management and control of our    
affairs; however, our board will retain our advisor to manage our day-to-day    
affairs and the acquisition and disposition of investments, subject to the      
supervision of our board.                                                       

The directors are not required to devote all of their time to our Company and   
are only required to devote such of their time to the affairs of our Company as 
their duties require. Our board of directors will meet quarterly in person or by
telephone, or more frequently if necessary. It is not expected that our         
directors will be required to devote a substantial portion of their time to     
discharge their duties as directors. Consequently, in                           

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the exercise of their fiduciary responsibilities, our directors will rely       
heavily on our advisor. In this regard, our advisor, in addition to our         
directors, will have a fiduciary duty to our Company.                           

Our directors will establish written policies on investments and borrowings and 
will monitor the administrative procedures, investment operations, and          
performance of our Company and our advisor to assure that such policies are in  
the best interest of the stockholders and are fulfilled. Until modified by our  
directors, we will follow the policies on investments set forth in this         
prospectus. See "Investment Policies and Policies With Respect to Certain Other 
Activities."                                                                    

Our Board of Directors is responsible for reviewing the fees and expenses of our
Company at least annually or with sufficient frequency to determine that the    
expenses incurred are in the best interests of the stockholders. Each such      
determination will be reflected in the minutes of the meetings of our board of  
directors. A majority of the independent directors and a majority of directors  
not otherwise interested in the transaction must approve each transaction with  
our advisor or its affiliates. In addition, a majority of the independent       
directors will be responsible for reviewing the performance of our advisor and  
determining that the compensation to be paid to our advisor is reasonable in    
relation to the nature and quality of services to be performed and the          
investment performance of our Company and that the provisions of our advisory   
services agreement are being carried out. Each such determination will be       
reflected in the minutes of the meetings of our board of directors. In making   
such determination, the independent directors will consider factors such as the 
net assets and net income of our Company, the amount of the fee paid to our     
advisor in relation to the size, composition and performance of our Company's   
portfolio, the success of our advisor in generating opportunities that meet the 
investment objectives of our Company, rates charged to other REITs and to       
investors other than REITs by advisors performing the same or similar services, 
additional revenues realized by our advisor and its affiliates through their    
relationship with our Company, whether paid by our Company or by others with    
whom we do business, the quality and extent of service and advice furnished by  
our advisor, the performance of our investment portfolio, and the quality of our
portfolio relative to the investments generated by our advisor for its own      
account. The independent directors will also determine whether any successor to 
our advisor possesses sufficient qualifications to perform the advisory function
for our Company and whether the compensation provided for in its contract with  
our Company is justified.                                                       

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Directors and Executive Officers

Our board currently consists of five directors, three of whom are independent,  
with independence being determined in accordance with the listing standards     
established by the New York Stock Exchange. Directors will be elected annually, 
and each director will hold office for one year until the next annual meeting of
stockholders and until his successor has been duly elected and qualified. There 
is no limit on the number of times that a director may be elected to office.    
There will be no cumulative voting in the election of directors. Consequently,  
at each annual meeting of our stockholders, directors will be elected by a      
plurality of the votes cast at that meeting.                                    

The following table sets forth information concerning our directors and         
executive officers:                                                             

                                                                [Download Table]

Name                      Age     Position                                       
----                    --------  --------                                       
                                                                                 
John P. Manning........    58     Chairman, Chief Executive Officer and Director 
Jeffrey H. Goldstein...    44     President, Chief Operating Officer and Director
Kevin P. Costello......    60     Executive Vice President                       
Richard J. DeAgazio....    61     Executive Vice President                       
Marc N. Teal...........    42     Senior Vice President, Chief Financial Officer,
                                  Treasurer and Secretary                        
Mark W. Dunne..........    50     Senior Vice President                          
Eileen P. O'Rourke.....    50     Senior Vice President                          
Philip S. Cottone*.....    66     Director                                       
Kevin C. Phelan........    61     Director                                       
Nicholas L. Iacuzio....    65     Director                                       

----------                                                                      

*   Mr. Cottone is our lead director                                            

The following is a biographical summary of the experience of our executive      
officers and directors:                                                         

Mr. Manning is also co-founder, and since 1974 has been the President and Chief 
Executive Officer of Boston Capital Corporation, the general partner of Boston  
Capital Holdings Limited Partnership ("Boston Capital") which owns 100% of our  
advisor and 66 2/3% of the dealer-manager. As founding CEO of Boston Capital    
Corporation, Mr. Manning's primary responsibilities include strategic planning, 
business development and the continued oversight of new opportunities. In       
addition to his responsibilities at Boston Capital, Mr. Manning is a proactive  
leader in the multifamily real estate industry. He served in 1989 as a member of
the Mitchell-Danforth Task Force, which reviewed and suggested reforms to the   
Low Income Housing Tax Credit program. He was the founding President of the     
Affordable Housing Tax Credit Coalition and is a former member of the board of  
the National Leased Housing Association. From 1992-1993 he served as a member of
the Massachusetts Housing Policy Committee as an appointee                      

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of the Governor of Massachusetts. In addition, Mr. Manning has testified before 
the U.S. House Ways and Means Committee and the U.S. Senate Finance Committee on
the critical role of the private sector in the success of the Low Income Housing
Tax Credit. In 1994, President Clinton appointed him to the President's Advisory
Committee on the Arts at the John F. Kennedy Center for the Performing Arts. In 
1998, President Clinton appointed Mr. Manning to the President's Export Council,
the premier committee comprised of major corporate CEOs that advise the         
President in matters of foreign trade and commerce. In 2003, Mr. Manning was    
appointed by Boston Mayor Tom Menino to the Mayor's Advisory Panel on Housing.  
Mr. Manning sits on the Board of Directors of the John F. Kennedy Presidential  
Library in Boston, where he serves as Chairman of the Distinguished Visitors    
Program. He also serves on the Board of Directors of the Beth Israel Deaconess  
Medical Center in Boston. Mr. Manning is a graduate of Boston College.          

Mr. Goldstein is also Chief Operating Officer and has been Director of Real     
Estate of Boston Capital Corporation since 1996. He directs Boston Capital      
Corporation's comprehensive real estate services, which include all aspects of  
origination, underwriting, due diligence and acquisition. As COO, Mr. Goldstein 
is responsible for the financial, accounting and operational areas of Boston    
Capital Corporation and assists in the design and implementation of business    
development and strategic planning objectives. Mr. Goldstein previously served  
as the Director of the Asset Management division as well as the head of the     
dispositions and troubled assets group. Utilizing his 20 years experience in the
real estate syndication and development industry, Mr. Goldstein has been        
instrumental in the diversification and expansion of Boston Capital             
Corporation's businesses. Prior to joining Boston Capital in 1990,              
Mr. Goldstein was Manager of Finance for A.J. Lane & Co., where he was          
responsible for placing debt on all new construction projects and debt structure
for existing apartment properties. Prior to that, he served as Manager for      
Homeowner Financial Services, a financial consulting firm for residential and   
commercial properties, and worked as an analyst responsible for budgeting and   
forecasting for the New York City Council Finance Division. He graduated from   
the University of Colorado and received his MBA from Northeastern University.   

Mr. Costello is also Executive Vice President and has been Director of          
Institutional Investing of Boston Capital Corporation since 1992 and serves on  
the firm's Executive Committee. He is responsible for all corporate investment  
activity and has spent over 20 years in the real estate syndication and         
investment business. Mr. Costello's prior responsibilities at Boston Capital    
Corporation have involved the management of the Acquisitions Department and the 
structuring and distribution of conventional and tax credit private placements. 
Prior to joining Boston Capital Corporation in                                  

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1987, he held positions with First Winthrop, Reynolds Securities and Bache &    
Company. Mr. Costello graduated from Stonehill College and received his MBA with
honors from Rutgers' Graduate School of Business Administration.                

Mr. DeAgazio also has been Executive Vice President of Boston Capital           
Corporation, and President of Boston Capital Securities, Inc., Boston Capital's 
NASD-registered broker/dealer since 1981. Mr. DeAgazio formerly served on the   
National Board of Governors of the NASD. He recently served as a member of the  
National Adjudicatory Council of the NASD. He was the Vice Chairman of the      
NASD's District 11 Committee, and served as Chairman of the NASD's Statutory    
Disqualification Subcommittee of the National Business Conduct Committee. He    
also served on the NASD State Liaison Committee, the Direct Participation       
Program Committee and as Chairman of the Nominating Committee. He is a founder  
and past President of the National Real Estate Investment Association. He is    
past President of the National Real Estate Securities and Syndication Institute 
and past President of the Real Estate Securities and Syndication Institute      
(Massachusetts Chapter). Prior to joining Boston Capital in 1981, Mr. DeAgazio  
was the Senior Vice President and Director of the Brokerage Division of Dresner 
Securities (USA), Inc., an international investment banking firm owned by four  
major European banks, and was a Vice President of Burgess & Leith/Advest. He has
been a member of the Boston Stock Exchange since 1967. He was on the Board of   
Directors of Cognistar Corporation. He serves or served on the Board of Trustees
of Bunker Hill Community College, the Business Leaders Council of the Boston    
Symphony, the Board of Trustees of Junior Achievement of Massachusetts, the     
Board of Advisors for the Ron Burton Kid's Training Village and is on the Board 
of Corporators of Northeastern University. He graduated from Northeastern       
University.                                                                     

Mr. Teal also has been Senior Vice President and Chief Financial Officer of     
Boston Capital Corporation since May 2003. Mr. Teal previously served as Senior 
Vice President and Director of Accounting and prior to that served as Vice      
President of Partnership Accounting. In his current role as Chief Financial     
Officer, he oversees all of the accounting, financial reporting, SEC reporting, 
budgeting, audit, tax and compliance for Boston Capital, its affiliated entities
and all Boston Capital-sponsored programs. Additionally, Mr. Teal is responsible
for maintaining all banking and borrowing relationships of Boston Capital       
Corporation and treasury management of all working capital reserves. He also    
oversees Boston Capital's information and technology areas, including the       
strategic planning. Mr. Teal has more than 18 years of finance and accounting   
experience. Prior to joining Boston Capital in 1990, Mr. Teal was a Senior      
Accountant for Cabot, Cabot & Forbes, a multifaceted real estate company, and   
prior to that was a Senior                                                      

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Accountant for Liberty Real Estate Corp. He received a Bachelor of Science in   
Accountancy from Bentley College and received a Masters in Finance from Suffolk 
University.                                                                     

Mr. Dunne is Senior Vice President and Director of Market Rate Housing for      
Boston Capital Corporation. Capitalizing on his 20 years in real estate and     
finance, Mr. Dunne oversees market rate housing initiatives for Boston Capital. 
Working with the Originations and Acquisitions teams, Mr. Dunne and his staff   
identify experienced development partners with a solid track record in          
multifamily development seeking to acquire and construct low-rise to mid-rise   
properties with 150 to 500 units and identify apartment properties with 150 to  
over 400 units meeting established investment parameters for direct investment. 
Prior to joining Boston Capital in 2002, Mr. Dunne served from 1989 to 2002 as  
President of River Partners, Inc. a real estate services company in Boston,     
Massachusetts. In this capacity, he was engaged by PaineWebber Properties from  
1991 to 2002 and served as Head of Portfolio Management and Dispositions from   
1996 to 2002. In addition, Mr. Dunne served from 1998 to 2002 as Director of    
Asset Management for real estate equity investments for PaineWebber, Inc.       
Previously, he held positions in real estate development and commercial lending.
He holds an AB from Syracuse University and an MS from MIT.                     

Ms. O'Rourke, age 50, is Senior Vice President and Director of Taxation and     
Housing Compliance for Boston Capital Corporation. Ms. O'Rourke has over        
20 years experience in taxation and accounting. Ms. O'Rourke served as the      
Director of Asset Management for Boston Capital Corporation from 1997 to 2002.  
Prior to joining Boston Capital in 1995, she was the Tax Manager at First Data  
Investor Services Group, Inc., where she directed the tax compliance of real    
estate public partnerships and the issuance of 200,000 investors' K-1s annually.
Before that she held positions as a Senior Tax Accountant with Culp, Elliott and
Carpenter, P.C., and as a Senior Auditor with the Internal Revenue Service. She 
served as the 2004 Chair of the Housing Credit Certified Professional Board of  
Governors and is a member of the American Institute of Certified Public         
Accountants, the Massachusetts and North Carolina Societies of Certified Public 
Accountants, as well as New England Women in Real Estate. Ms. O'Rourke graduated
with honors from Russell Sage College and is licensed as a Certified Public     
Accountant.                                                                     

Mr. Cottone is President of Property Trust Advisory Corporation, a real estate  
investment and advisory company located in Devon, PA and a Vice President of    
Universal Field Services, a Tulsa, OK, right of way contract services firm. He  
has been active in real estate investment, development and syndication          
nationwide since 1983. He is a director of Government Properties Trust,         
(NYSE:GPT); of a subsidiary of Universal; and of RC Company, Inc., a Paoli, PA, 
general contractor. He was General Counsel and a                                

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member of the Executive Committee of the International Right of Way Association 
from 1976 to 1983, and 1998 to 2002, and a trustee and Treasurer of the Right of
Way International Education Foundation from 1983 to 1998. Mr. Cottone is a      
Counselor of Real Estate (CRE) and was the 2004 national Chair. He was 1988     
President of the Real Estate & Syndication Institute (RESSI). Mr. Cottone was   
Vice Chair of the Board of Governors of the NASD in 1993, Chair of the NASD     
National Business Conduct Committee in 1992 and Chair of the National           
Arbitration & Mediation Committee from 1995 to 1998. He serves as a mediator for
the NASD, NYSE, and The Counselors of Real Estate. By invitation he has         
testified before the House, Senate and administrative agencies of the federal   
government on real estate securities, and he was a lecturer on the subject on   
the faculty of the Real Estate Institute of New York University. Mr. Cottone    
received an AB from Columbia College, an LLB from New York University School of 
Law and is a retired member of the New York bar.                                

Mr. Phelan is Executive Vice President of the Executive Committee, and Director 
and Partner of Meredith & Grew ("M&G"), a full service real estate firm.        
Mr. Phelan joined M&G in 1978 and established the Finance and Capital Markets   
Group. Under Mr. Phelan's direction, the capital markets group has become the   
second largest in the New England region. The department services $1 billion in 
loans and acts as correspondent for approximately thirteen financial            
institutions and produces in excess of $500 million in real estate loans        
annually. The Finance and Capital Markets Group is headquartered in Boston,     
Massachusetts. Prior to joining M&G, Mr. Phelan was a Vice President at State   
Street Bank & Trust Co., where he was responsible for commercial lending. He was
instrumental in the restructuring and repositioning of a 750,000 square foot    
project known as State Street South. Mr. Phelan holds many Directorships and    
served on Correspondent Advisory Councils for AEGON U.S.A Realty Advisors, Inc. 
and Nationwide Life. He graduated from Providence College and received his MBA  
from Boston College.                                                            

Mr. Iacuzio is the Chief Financial Officer of H2O Applied Technologies and H2O  
Capital Partners. He also continues to maintain a real estate consulting        
practice specializing in housing and real estate syndications. In 2000,         
Mr. Iacuzio retired as a partner from the firm of PricewaterhouseCoopers        
(previously Coopers & Lybrand) where he led the Boston office real estate       
practice. At PricewaterhouseCoopers, Mr. Iacuzio was involved in the formation  
and audit of various real estate investment trusts and assisted in many real    
estate syndications. He also was a member of the firm's real estate investment  
trust advisory group. Prior to joining Coopers & Lybrand                        

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in 1990, he headed the Boston office Accounting and Auditing Department of      
Laventhol & Horwath a national audit firm where he was a partner for 20 years.  
Mr. Iacuzio currently serves on the Executive committee of Reagle Players, Inc. 
a community theatre group in Waltham, MA and serves on the finance committee of 
Eliot Church in Newton, Massachusetts. He graduated from Bentley School of      
Accounting and Finance in 1960.                                                 

Independent Directors 

Under our articles of incorporation, a majority of our board of directors must  
consist of independent directors, except for a period of 90 days after the      
death, removal or resignation of an independent director. The independent       
directors will nominate replacements for vacancies in the independent director  
positions. An independent director may not, directly or indirectly (including   
through a member of his immediate family), own any interest in, be employed by, 
have any present business or professional relationship with or serve as an      
officer or director of our advisor or its affiliates, or serve as a director of 
more than three REITs advised by our advisor or its affiliates. Except to carry 
out the responsibilities of a director, an independent director may not perform 
material services for our Company. Messrs. Cottone, Phelan and Iacuzio are our  
current independent directors. Mr. Cottone has been selected by our board of    
directors to serve as the independent lead director.                            

Committees of the Board of Directors

AUDIT COMMITTEE:  The members of the Audit Committee are Messrs. Cottone,       
Phelan, and Iacuzio. Mr. Iacuzio is its chairman. The purposes of the Audit     
Committee are to:                                                               

- oversee the accounting and financial reporting processes of the Company and   
the audits of the Company's financial statements;                           

- take appropriate action to oversee the qualifications, independence and       
performance of the Company's independent auditors; and                      

- prepare the report required by the rules of the SEC to be included in the     
Company's annual proxy statement.                                           

The directors have determined that, as defined by SEC regulations, Mr. Iacuzio  
qualifies as the "audit committee financial expert" as defined under applicable 
SEC rules and that all three members are "independent" in accordance with the   
applicable listing standards of the New York Stock Exchange and the rules and   
regulations of the SEC and related federal laws. The audit committee's specific 
responsibilities are included in the audit committee charter adopted by the     
Board of Directors. A copy of the charter can be obtained by written request to 
Marc N. Teal, Boston Capital Corp, One Boston Place, Suite 2100, Boston MA      
02108.                                                                          

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COMPENSATION COMMITTEE:  The members of the Compensation Committee are          
Messrs. Cottone, Phelan and Manning. Mr. Phelan is the chairman.                
Messrs. Cottone and Phelan are considered "independent" in accordance with the  
applicable listing standards of the New York Stock Exchange and the rules and   
regulations of the SEC and related federal laws. The compensation committee's   
specific responsibilities are included in the compensation committee charter    
adopted by the Board of Directors. A copy of the charter can be obtained by     
written request to Marc N. Teal, Boston Capital Corp, One Boston Place, Suite   
2100, Boston MA 02108.                                                          

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE:  The members of the Nominating   
and Corporate Governance Committee are Messrs. Cottone, Iacuzio and Phelan.     
Mr. Cottone is the chairman. All of the members are considered "independent" in 
accordance with the applicable listing standards of the New York Stock Exchange 
and the rules and regulations of the SEC and related federal laws.              

The Nominating and Corporate Governance Committee's specific responsibilities   
are included in the Nominating and Corporate Governance Committee's charter     
adopted by the Board of Directors. A copy of the charter can be obtained by     
written request to Marc N. Teal, Boston Capital Corp, One Boston Place, Suite   
2100, Boston MA 02108.                                                          

OTHER COMMITTEES:  The board may establish from time to time other committees.  
At least a majority of the members of any other committee our board may         
establish must be independent directors.                                        

Compensation of Directors and Executive Officers

Each independent director will receive an annual retainer of $50,000, as well as
$1,000 for each meeting attended in person ($375 for each telephonic meeting in 
which the director participates), including committee meetings, except for a    
committee meeting attended in person held in connection with a board meeting    
attended in person, for which the director will receive $500. Our executive     
officers who are also our directors do not receive director fees. The chairman  
of our audit committee receives an additional annual retainer of $10,000. In    
addition, the independent directors receive automatically, upon initial election
to our board, an option to purchase 5,000 shares of our common stock, and       
annually each year after their initial election receive an option to purchase   
5,000 shares of our common stock. The option exercise price is the fair market  
value of our common stock on the date prior to the date of initial election or  
prior to the date of our annual meeting, as applicable. We will not pay any     
compensation to our officers and directors who also serve as officers of our    
advisor. In connection with their election to our board,                        

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Messrs. Cottone, Phelan and Iacuzio were each granted options to purchase 5,000 
shares at $10.00 per share. The options have not been exercised as of the date  
hereof.                                                                         

We did not pay compensation to the executive officers of our affiliated entities
during 2005. During 2005 we paid fees to each of the directors for their        
participation in various meetings in 2005 as follows:                           

                                                                [Download Table]

                                      Mr. Cottone   Mr. Iacuzio   Mr. Phelan
                                      -----------   -----------   ----------
                                                                            
Board..............................      $3,375        $2,375       $2,375  
Audit Committee....................       1,750         2,250        2,250  
Compensation Committee.............         500           500          500  
Nominating & Corporate                                                      
  Governance.......................         500            --          500  

Equity Incentive Plan 

We have adopted the Boston Capital Real Estate Investment Trust, Inc. 2004      
Equity Incentive Plan. The incentive plan is designed to enable our advisor and 
its affiliates to obtain or retain the services of employees, and to enable us, 
our advisor and its affiliates to retain or obtain the services of consultants, 
considered essential to our long-range success by offering such persons         
incentives under the plan. The incentive plan is administered by our            
compensation committee. The maximum number of shares available for issuance     
under the incentive plan is 4,000,000 shares of common stock. Under the         
incentive plan, the maximum number of shares of common stock for which options  
may be granted to any person in any calendar year and the aggregate maximum     
number of shares subject to other awards which may be delivered (or the value of
which may be paid) to any person in any calendar year under the incentive plan  
are each 100,000. No shares will be issued under the incentive plan with an     
exercise price less than 100% of the fair market value of the stock at the time 
of issuance. A copy of the equity incentive plan has been filed with the SEC as 
an exhibit to the registration statement of which this prospectus is a part.    

Non-qualified Stock Options 

The incentive plan permits the granting of "non-qualified" stock options to     
participants subject to the absolute discretion of our compensation committee   
and applicable limitations of the incentive plan. The option exercise price of  
each option may not be less than 100% of the fair market value of our common    
stock on the date of grant.                                                     

The term of each option is fixed by our compensation committee, but may not     
exceed ten years from the date of grant. If an optionee's employment or other   
association with our Company, our advisor or its affiliates is terminated,      
whether voluntarily or otherwise, any outstanding option of                     

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the optionee ceases to be exercisable not less than six months following the    
date of termination if termination is caused by death or disability and not less
than 30 days from the date of termination if termination is caused by other than
death or disability, unless employment is terminated for cause. Upon exercise of
options, the option exercise price must be paid in full either in cash or, if   
our compensation committee permits, by delivery of shares of common stock       
already owned by the optionee.                                                  

Restricted Stock

Our compensation committee may also award shares of our common stock to         
participants, subject to such conditions and restrictions as our compensation   
committee may determine. These conditions and restrictions may include the      
achievement of certain performance goals and/or continued employment or         
consulting arrangement with our Company, our advisor or its affiliates through a
specified restricted period. Performance goals could include our achievement of 
a certain level of financial performance or the achievement of goals more       
directly related to the property acquisition, managerial or financial services  
the person is providing to us. If the performance goals and other restrictions  
are not attained, the participants will forfeit their shares of restricted      
stock. The purchase price of shares of restricted stock, if any, will be        
determined by our compensation committee.                                       

Unrestricted Stock

Our compensation committee may also grant shares of our common stock, at no     
cost, or for a purchase price determined by our compensation committee, which   
are free from any restrictions under the incentive plan. Shares of unrestricted 
stock may be issued to participants in recognition of past services or other    
valid consideration, and may be issued in lieu of cash compensation to be paid  
to those participants.                                                          

Performance Share Awards

Our compensation committee may also grant performance share awards of our common
stock to participants entitling the participants to receive shares of our common
stock upon the achievement of individual or company performance goals and such  
other conditions as our compensation committee may determine.                   

Indemnification 

Pursuant to our articles, we have entered into agreements indemnifying each     
director for personal losses or liability reasonably incurred by the director in
connection with any act or omission performed or omitted to be performed on     
behalf of the Company, provided that the director has                           

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determined in good faith, that the course of conduct which caused the loss, or  
liability was in the best interests of the Company. Such indemnification is     
subject to the conditions and limitations imposed by Article II.G of the NASAA  
Guidelines and the Maryland General Corporation Law. Among the conditions and   
limitations on indemnification are requirements that the loss or liability not  
be caused by the negligence or misconduct by a non-independent director or the  
gross negligence or willful misconduct of an independent director and that the  
act or omission that was material to the loss or liability was not committed in 
bad faith or was not the result of active or deliberate dishonesty. In addition,
our articles and the indemnification agreements provide for the advancement of  
costs, expenses and attorneys' fees, in accordance with the procedures under the
Maryland General Corporation Law and subject to the NASAA Guidelines. These     
rights are contract rights fully enforceable by each beneficiary. Furthermore,  
subject to the NASAA Guidelines, our officers and directors are indemnified     
against specified liabilities by the soliciting dealers, and the soliciting     
dealers are indemnified against certain liabilities by us, under the soliciting 
dealer agreements relating to this offering and for specified liabilities and   
expenses pursuant to the advisory services agreement between us and our advisor.

Subject to the NASAA Guidelines, we have agreed to indemnify the dealer-manager 
against liabilities, including liabilities under the Securities Act, arising out
of a breach or alleged breach by us of any of our representations and warranties
or arising out of an untrue statement or alleged untrue statement of a material 
fact contained in this prospectus or the registration statement of which it is a
part, or arising out of the omission or alleged omission to state in those      
documents a material fact required to be stated in those documents necessary to 
make the statements not misleading. The dealer-manager has agreed to indemnify  
us against liabilities arising out of the failure or alleged failure by the     
dealer-manager to perform under the dealer-manager agreement or arising out of  
any untrue statement or alleged untrue statement of a material fact made by the 
dealer-manager to any offeree or purchaser of shares in this offering (other    
than any statement contained in this prospectus or in any sales literature      
authorized by us) or arising out of any omission or alleged omission by the     
dealer-manager to state to any offeree or purchaser a material fact necessary in
order to make the statements made to such offeree or purchaser not misleading in
light of the circumstances in which they were made (other than any such material
fact omitted from this prospectus). Subject to the NASAA Guidelines, we also    
have agreed to indemnify and hold harmless our advisor and its affiliates       
performing services for us from specific claims and liabilities arising out of  
the performance of its obligations under the advisory agreement between our     
advisor and our Company.                                                        

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As a result, we and our stockholders may be entitled to a more limited right of 
action than they would otherwise have if these indemnification rights were not  
included in these agreements. Any indemnification or any agreement to hold      
harmless is recoverable only out of our assets and not from our stockholders.   

Our Advisor and the Advisory Services Agreement 
Overview

Our advisor is Boston Capital REIT Advisors, LLC, a Delaware limited liability  
company that is a wholly owned subsidiary of Boston Capital Holdings Limited    
Partnership. Some of our officers and directors are also officers of our        
advisor. John P. Manning is the sole shareholder of Boston Capital Corporation, 
the general partner of Boston Capital Holdings Limited Partnership and the      
manager of our advisor. (See "Conflicts of Interest.") Our advisor has          
contractual responsibility to our Company and our stockholders pursuant to an   
advisory services agreement. Our Company has no employees of its own.           

While we have no present plans to do so, we may in the future decide to perform 
the advisory services function ourselves.                                       

The following table sets forth information concerning the individuals who are   
the directors and executive officers of our advisor:                            

                                                                [Download Table]

Name                      Age     Position                                      
----                    --------  --------                                      
                                                                                
John P. Manning........    58     President                                     
Jeffrey H. Goldstein...    44     Executive Vice President, Treasurer and Clerk 
Kevin P. Costello......    60     Executive Vice President                      
Richard J. DeAgazio....    61     Executive Vice President                      
Marc N. Teal...........    42     Senior Vice President, Assistant Treasurer and
                                  Assistant Clerk                               
Mark W. Dunne..........    50     Senior Vice President                         
Theodore Trivers.......    51     Senior Vice President                         
Eileen P. O'Rourke.....    50     Senior Vice President                         

The backgrounds of Messrs. Manning, Goldstein, Costello, DeAgazio, Teal, Dunne  
and Ms. O'Rourke are described in the "Management--Directors and Executive      
Officers" section of this prospectus. The following is a biographical summary of
the experience of Mr. Trivers and of other persons who will be performing       
services to our advisor.                                                        

Frank L. Chandler, age 43, has been Senior Vice President and National Sales    
Director for Boston Capital Securities, Inc., the NASD-registered broker/dealer 
since 2003. From 2002 to 2003, he held the position of Vice President and       
Director of Sales. Prior to that, from 2000 to 2002, he was Assistant Vice      
President and Director of Internal Sales. From 1997 to 2000 he held the position
of Sales Desk Manager. He is currently charged with                             

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managing and overseeing the firm's sales team, key accounts and direct sales.   
Prior to joining Boston Capital Securities, Inc., Mr. Chandler was the President
of a financial services video marketing company. Prior to that, he was a        
financial executive and Vice President at Bear Stearns & Co. and a registered   
representative at both Drexel Burnham Lambert and Smith Barney. Mr. Chandler is 
currently serving a 3-year term as a member of the NASD District 11 Committee.  
Mr. Chandler attended Syracuse University prior to receiving a Bachelor of Arts 
degree from Skidmore College.                                                   

Steven M. Spall, age 43, has been a Senior Vice President and Director of Asset 
Management since January 2002. Mr. Spall joined Boston Capital Corporation in   
1993 with previous experience as an Asset Manager with the Weissberg Development
Corporation in Arlington, Virginia, and The Grossman Companies in Quincy,       
Massachusetts. From 1993 to 2002 he worked in the Acquisitions Department and   
has been responsible for developing and maintaining successful relationships    
with many of Boston Capital's most important general partners. He has an MBA    
with a concentration in finance from Suffolk University and a BA in economics   
from the State University of New York at Oswego.                                

Mr. Trivers, age 51, is also Senior Vice President and has been Director of     
Underwriting and Due Diligence for Boston Capital Corporation since 1993. He    
directs the underwriting and acquisition of properties for the Boston Capital   
portfolios and serves on the Investment Committee and the Disposition Committee.
From 2002 to 2003, Mr. Trivers served as Director of Tax Credit Acquisitions. He
has 24 years experience in real estate development, construction, finance and   
property management. Prior to joining Boston Capital in 1993, Mr. Trivers was   
Treasurer of New England Communities, Inc., a regional real estate acquisition, 
asset management and property management company located in Massachusetts.      
Mr. Trivers received a Bachelor of Science degree in business and an MBA from   
Babson College.                                                                 

The Advisory Services Agreement 

Many of the services to be performed by our advisor in managing our day-to-day  
activities are summarized below. This summary is provided to illustrate the     
material functions which our advisor will perform for us as our advisor and it  
is not intended to include all of the services which may be provided to us by   
third parties. Under the terms of the advisory services agreement, our advisor, 
either directly or indirectly by engaging an affiliate, undertakes to use its   
best efforts to present to us investment opportunities consistent with our      
investment policies and objectives as adopted by the board of directors. In     
performing this undertaking, our advisor has agreed, among other things, to:    

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- serve as our investment and financial advisor and provide reports with respect
to our portfolio of investments;                                            

- negotiate purchase contracts and services related to our acquisitions of real 
properties and other real estate investments;                               

- structure and negotiate the terms of investments in real properties and other 
real estate investments;                                                    

- obtain from third parties property management services for our investments in 
real properties; and                                                        

- advise us concerning our negotiations with investment banking firms,          
securities brokers or dealers and other institutions or investors for public
or private sales of our securities, but in no event in such a way that our  
advisor could be deemed to be acting as a dealer or underwriter under the   
Securities Act of 1933, as amended.                                         

The initial term of the advisory services agreement ends on the first           
anniversary of the initial closing of shares in this offering and may be renewed
for an unlimited number of successive one-year periods. Additionally, our       
advisory services agreement may be terminated, subject to an evaluation of the  
performance of our advisor by the Audit Committee of our board of directors, by 
a majority of our independent directors or our advisor upon 60 days' written    
notice.                                                                         

Our advisor and its affiliates expect to engage in other business ventures and, 
as a result, their resources will not be dedicated exclusively to our business. 
However, pursuant to the advisory services agreement, our advisor must devote   
sufficient resources to the administration of our Company to discharge its      
obligations. Our advisor may assign the advisory services agreement to an       
affiliate upon approval of a majority of our independent directors. Provided our
advisor consents, we may assign the advisory services agreement to a successor  
entity and, provided we consent, our advisor may assign the advisory services   
agreement to a successor entity. Notwithstanding the foregoing, so long as we   
intend to qualify as a REIT, the advisory services agreement may not be assigned
to any entity that serves as property manager for any of our communities.       

Our advisor may not make any acquisition of a community or financing of such    
acquisition on our behalf without the prior approval of a majority of our       
independent directors. The actual terms and conditions of transactions involving
investments in communities will be determined in the sole discretion of our     
advisor, subject at all times to such board approval.                           

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Pursuant to the advisory services agreement, we will pay our advisor or its     
affiliates fees and reimbursements, as shown in "Compensation and Fees." The    
fees include:                                                                   

- a monthly asset management fee equal to 1/12th of .75% of the Company's real  
estate asset value (exclusive of acquisition fees and acquisition expenses),
including the original principal amounts of mortgages assumed on acquisition
of the communities;                                                         

- an acquisition fee of up to 2.7% of gross offering proceeds for services      
rendered in connection with the investigation, selection and acquisition of 
communities;                                                                

- a subordinated disposition fee equal to the lesser of 3% of the contract price
for communities sold or one-half of a competitive real estate commission,   
 payable only after investors have received a return of 100% of their invested
capital plus the Stockholder's 6.0% Return; and                             

- a subordinated share of net sale proceeds equal to 15% of net sale proceeds,  
  payable only after investors have received a return of 100% of their aggregate
invested capital plus the Stockholder's 6.0% Return.                        

We will also reimburse our advisor or its affiliates for all of the costs it    
incurs in connection with the services it provides to us, including:            

- organization and offering expenses in an amount up to 2.25% of gross offering 
proceeds, which include actual legal, accounting, printing and expenses     
  attributable to preparing the SEC registration statement, qualification of the
shares for sale in the states and filing fees incurred by our advisor;      

- the annual cost of goods and materials used by us and obtained from entities  
not affiliated with ouradvisor, including brokerage fees paid in connection 
with the purchase and sale of securities;                                   

- administrative services including personnel costs; provided, however, that no 
  reimbursement will be made for costs of personnel to the extent that personnel
are used in transactions for which our advisor receives a separate fee; and 

- acquisition expenses of up to 0.5% of gross offering proceeds, which expenses 
are defined to include expenses related to the selection and acquisition of 
communities. In no event shall acquisition expenses exceed the lesser of    
actual cost or 90% of competitive rates charged by unaffiliated persons     
providing similar services.                                                 

Our advisor must reimburse us at least annually for reimbursements paid to our  
advisor in any year to the extent that such reimbursements to our advisor cause 
our operating expenses to exceed the greater of (i) 2% of                       

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our average invested assets, which generally consists of the average book value 
of our real estate communities before reserves for depreciation or bad debts, or
(ii) 25% of our net income, which is defined as our total revenues less total   
expenses for any given period excluding reserves for depreciation and bad debt. 
Such operating expenses do not include amounts payable out of capital fees      
payable to our advisor. To the extent that operating expenses payable or        
reimbursable by us exceed this limit and our independent directors determine    
that the excess expenses were justified based on unusual and nonrecurring       
factors which they deem sufficient, our advisor may be reimbursed in future     
years for the full amount of the excess expenses, or any portion thereof, but   
only to the extent the reimbursement would not cause our operating expenses to  
exceed the limitation in any year. Within 60 days after the end of any of our   
fiscal quarters for which total operating expenses for the 12 months then ended 
exceed the limitation, we will send our stockholders a written disclosure,      
together with an explanation of the factors the independent directors considered
in arriving at the conclusion that the excess expenses were justified.          

In the event the advisory services agreement is terminated, our advisor will be 
paid all accrued and unpaid fees and expense reimbursements, and a special      
termination payment equal to the projected asset management fee for the one-year
period following termination. We will not reimburse our advisor or its          
affiliates for services for which our advisor or its affiliates are entitled to 
compensation in the form of a separate fee.                                     

The board of directors may in the future decide that our Company should assume  
direct responsibility for some or all of our advisor's duties and               
self-administer such duties. To facilitate the assumption of such               
responsibilities, the directors may determine to acquire all or a portion of our
advisor or its affiliates in exchange for cash, stock or other consideration.   
Any such acquisition would be subject to the conflict of interest provisions of 
our articles of incorporation governing transactions with our advisor and its   
affiliates, which generally require a finding by a majority of the directors    
(including a majority of the independent directors) that the transaction is fair
and reasonable to the Company. Depending on the circumstances and the nature and
amount of the consideration, a shareholder vote may not be required to authorize
such an acquisition.                                                            

Other Affiliated Companies

Dealer-Manager

Boston Capital Securities, Inc., our dealer-manager, is a member firm of the    
NASD. The dealer-manager was organized in 1982 for the purpose of               

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participating in and facilitating the distribution of securities of other       
programs sponsored by Boston Capital.                                           

The dealer-manager will provide certain wholesaling, sales promotional and      
marketing assistance services to us in connection with the distribution of the  
shares offered pursuant to this prospectus. It may also sell a limited number of
shares at the retail level. (See "Selling and Escrow Arrangements.") The        
dealer-manager will also serve as reinvestment agent for our reinvestment plan. 
(See "Summary of Reinvestment Plan.")                                           

Boston Capital Holdings Limited Partnership and Richard J. DeAgazio are the     
stockholders of the dealer-manager. Mr. DeAgazio is the President, Marc N. Teal 
is the Executive Vice President, Treasurer and Clerk, and Mr. DeAgazio and John 
P. Manning are the directors of the dealer-manager. Mr. Manning is also the     
owner, President and Chief Executive Officer of the general partner of Boston   
Capital Holdings Limited Partnership. (See "Conflicts of Interest.")            

Management Decisions

The primary responsibility for the management decisions of our advisor and its  
affiliates, including the selection of investment properties recommended to our 
board of directors, the negotiation for these investments, and the selection of 
property managers for these investment properties resides in an Investment      
Committee consisting of John P. Manning, Jeffrey H. Goldstein, Theodore Trivers 
and Mark Dunne. Our board of directors must approve all acquisitions of real    
estate properties and all contracts with property managers.                     

COMPENSATION AND FEES 

The table below summarizes the types, recipients, methods of computation, and   
estimated amounts of all compensation, fees, reimbursements and distributions to
be paid directly or indirectly by our Company to our advisor and its affiliates,
exclusive of any distributions to which our advisor or its affiliates may be    
entitled by reason of their purchase and ownership of shares in connection with 
this offering.                                                                  

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The following arrangements for compensation and fees to our advisor and its     
affiliates were not determined by arm's-length negotiations. See "Conflicts of  
Interest." There is no item of compensation and no fee that can be paid to our  
advisor or its affiliates under more than one category.                         

                                                                [Download Table]

                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                      ORGANIZATIONAL AND OFFERING STAGE                       
------------------------------------------------------------------------------
SELLING COMMISSIONS IN  7.0% gross offering     $175,000        $70,000,000   
CONNECTION WITH THE     proceeds before                                       
OFFERING--THE DEALER-   reallowance of                                        
MANAGER                 commissions earned by                                 
                        participating broker-                                 
                        dealers. The                                          
                        dealer-manager intends                                
                        to reallow 100% of                                    
                        commissions earned for                                
                        those transactions                                    
                        that involve partici-                                 
                        pating broker-dealers.                                

DEALER-MANAGER FEE--    2.0% of gross offering  $ 50,000        $20,000,000   
THE DEALER MANAGER      proceeds before                                       
                        reallowance to                                        
                        participating                                         
                        broker-dealers. The                                   
                        dealer-manager, in its                                
                        sole discretion may                                   
                        reallow up to 1.5% of                                 
                        its dealer-manager fee                                
                        to be paid to such                                    
                        participating                                         
                        broker-dealers as                                     
                        additional                                            
                        compensation.                                         

REIMBURSEMENT OF        Up to 2.25% of gross    $ 56,250        $22,500,000   
ORGANIZATION AND        offering proceeds. If                                 
OFFERING EXPENSES--OUR  organization and                                      
ADVISOR OR ITS          offering expenses                                     
AFFILIATES              (excluding selling                                    
                        commissions and the                                   
                        dealer-manager fee)                                   
                        exceed 2.25% of the                                   
                        proceeds raised in                                    
                        this offering, the                                    
                        excess will be paid by                                
                        our advisor without                                   
                        recourse to us.                                       
------------------------------------------------------------------------------

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                                                                [Download Table]

                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                      ACQUISITION AND DEVELOPMENT STAGE                       
------------------------------------------------------------------------------
ACQUISITION FEES--OUR   Up to 2.70% of gross    $ 67,500        $27,000,000   
ADVISOR OR ITS AFFILI-  offering proceeds for                                 
ATES (2)                the review and                                        
                        evaluation of real                                    
                        property acquisi-                                     
                        tions. $1,444,844 of                                  
                        acquisition fees have                                 
                        been prepaid to an                                    
                        affiliate, Boston                                     
                        Capital Holdings                                      
                        Limited Partnership.                                  

                        The purchase price for                                
                        each community                                        
                        included the following                                
                        prepaid acquisition                                   
                        fees: $470,908 for the                                
                        Jacksonville                                          
                        communities (1.60% of                                 
                        the offering proceeds                                 
                        related to the                                        
                        Jacksonville communi-                                 
                        ties); $552,794 for                                   
                        the Seattle                                           
                        communities (2.79% of                                 
                        the offering proceeds                                 
                        related to the Seattle                                
                        communities); and                                     
                        $421,142 for the                                      
                        Portland/Salt Lake                                    
                        communities (1.63% of                                 
                        the offering proceeds                                 
                        related to the                                        
                        Portland/Salt Lake                                    
                        communities). These                                   
                        amounts will be                                       
                        deducted from the                                     
                        2.70% acquisition fee                                 
                        we have agreed to pay                                 
                        our advisor with                                      
                        respect to each of the                                
                        communities. An                                       
                        acquisition fee of                                    
                        approximately $173,000                                
                        will be paid once the                                 
                        lien under the                                        
                        Wachovia loan is                                      
                        released.                                             

                        If we raise sufficient                                
                        funds to repay the                                    
                        borrowings related to                                 
                        a                                                     

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                                                                [Download Table]

                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                      ACQUISITION AND DEVELOPMENT STAGE                       
------------------------------------------------------------------------------
                        community, the addi-                                  
                        tional acquisition fee                                
                        due will be paid at                                   
                        the time of the                                       
                        repayment of such                                     
                        borrowings less any                                   
                        amounts previously                                    
                        prepaid; thus if we                                   
                        raise at least                                        
                        approximately $29.5                                   
                        million (not including                                
                        any accrued interest                                  
                        on our affiliate line                                 
                        of credit or amounts                                  
                        distributed to                                        
                        stockholders from                                     
                        offering proceeds) and                                
                        repay the amount of                                   
                        borrowings related to                                 
                        our Jacksonville                                      
                        communities, we would                                 
                        pay an additional                                     
                        $325,592 in                                           
                        acquisition fees,                                     
                        which represents the                                  
                        $796,500 fee due less                                 
                        the prepaid fee of                                    
                        $470,908.                                             

REIMBURSEMENT OF        Up to 0.5% of gross     $ 12,000        $5,000,000    
ACQUISITION EXPENSES--  offering proceeds. The                                
OUR ADVISOR OR ITS      purchase price for                                    
AFFILIATES (2)          each community                                        
                        included the following                                
                        prepaid acquisition                                   
                        expenses: $73,519 for                                 
                        the Jacksonville com-                                 
                        munities (0.25% of the                                
                        offering proceeds                                     
                        related to                                            
                        Jacksonville); $49,739                                
                        for the Seattle                                       
                        communities (0.25% of                                 
                        the offering proceeds                                 
                        related to Seattle);                                  
                        and $65,751 for the                                   
                        Portland/Salt Lake                                    
                        communities (0.25% of                                 
                        the offering proceeds                                 
                        related to the                                        
                        Portland/ Salt Lake                                   
                        communities).                                         

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                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                      ACQUISITION AND DEVELOPMENT STAGE                       
------------------------------------------------------------------------------
                        If we raise sufficient                                
                        funds to repay the                                    
                        borrowings related to                                 
                        a community, the addi-                                
                        tional acquisition                                    
                        expenses due will be                                  
                        paid at the time of                                   
                        the repayment of such                                 
                        borrowings less any                                   
                        amounts previously                                    
                        prepaid; thus if we                                   
                        raise approximately                                   
                        $29.5 million (not                                    
                        including any accrued                                 
                        interest on our                                       
                        affiliate line of                                     
                        credit or amounts                                     
                        distributed to                                        
                        stockholders from                                     
                        offering proceeds) and                                
                        repay the amount of                                   
                        borrowings related to                                 
                        our Jacksonville                                      
                        communities, we would                                 
                        pay an additional                                     
                        $73,981 in acquisi-                                   
                        tion expenses, which                                  
                        represents the                                        
                        $147,500 acquisition                                  
                        expenses due less the                                 
                        prepaid acquisition                                   
                        expenses of $73,519.                                  
------------------------------------------------------------------------------
                          OPERATIONAL STAGE                                   
------------------------------------------------------------------------------
ASSET MANAGEMENT        For the management of   Based on the    Not determi-  
FEE--OUR ADVISOR OR     our affairs, we will    communities     nable at this 
ITS AFFILIATES          pay our advisor a       identified in   time as this  
                        monthly asset           this prospec-   amount will   
                        management fee equal    tus, the esti-  increase if we
                        to 1/12th of 0.75% of   mated amount    acquire       
                        the Company's real      would be        additional    
                        estate asset value as   $121,757 per    communities.  
                        of the end of the       month.                        
                        preceding month. Real                                 
                        estate asset value                                    
                        equals the amount                                     
                        actually paid or                                      
                        allocated to the                                      
                        purchase, devel-                                      
                        opment, construction                                  
                        or                                                    

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                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                          OPERATIONAL STAGE                                   
------------------------------------------------------------------------------
                        improvement of commu-                                 
                        nities we wholly own                                  
                        (including the                                        
                        principal amount of                                   
                        any mortgage                                          
                        indebtedness on the                                   
                        communities assumed                                   
                        upon the purchase of                                  
                        the communities), and,                                
                        in the case of                                        
                        communities in which                                  
                        we are a co-venturer                                  
                        or partner, our                                       
                        portion of such amount                                
                        with respect to such                                  
                        communities, exclu-                                   
                        sive of acquisition                                   
                        fees and acquisition                                  
                        expenses. The asset                                   
                        management fee, which                                 
                        will not exceed fees                                  
                        which are competitive                                 
                        for similar services                                  
                        in the same geographic                                
                        area, may or may not                                  
                        be taken, in whole or                                 
                        in part as to any                                     
                        year, in the sole dis-                                
                        cretion of our                                        
                        advisor. All or any                                   
                        portion of the asset                                  
                        management fee not                                    
                        taken as to any fiscal                                
                        year will be deferred                                 
                        without interest and                                  
                        may be taken in such                                  
                        other fiscal year as                                  
                        our advisor                                           
                        determines.                                           

LOAN INTEREST--BCP      Base interest at 9.5%   Based on the                  
FUNDING                 per annum plus bonus    $56,596,665                   
                        interest at 5.3% to     balance as of                 
                        the extent of cash      Decem-                        
                        available for debt      ber 31, 2005,                 
                        service after payment   the annual                    
                        of base interest,       base interest                 
                        payable quarterly,      paid is                       
                        and, in the case of     $5,376,683.                   
                        base interest, to the                                 
                        extent not paid,                                      

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                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                          OPERATIONAL STAGE                                   
------------------------------------------------------------------------------
                        added to principal. In  Any addi-                     
                        return for our          tional bonus                  
                        affiliate line of       interest will                 
                        credit being non-       be equal to                   
                        recourse to the Com-    the                           
                        pany, we agreed to pay  distributa-                   
                        additional interest     ble cash flow                 
                        solely from cash        of the com-                   
                        available for debt      munities in                   
                        service from our        excess of base                
                        initial ten             interest. No                  
                        communities prior to    such addi-                    
                        the repayment of the    tional bonus                  
                        line of credit          interest was                  
                        attributable to each    paid in 2003,                 
                        community. Until the    2004, and 2005                
                        line of credit          because there                 
                        attributable to each    has not been                  
                        community is repaid by  any dis-                      
                        the due date of         tributable                    
                        January 1, 2007,        cash flow.                    
                        effectively all cash                                  
                        flow generated by such                                
                        community will be paid                                
                        to BCP Funding, LLC.                                  
                        Additional interest is                                
                        payable quarterly only                                
                        to the extent of                                      
                        income from commu-                                    
                        nities still subject                                  
                        to BCP Funding's                                      
                        encumbrances. Such                                    
                        additional interest                                   
                        shall not be paid from                                
                        proceeds of this                                      
                        offering or from cash                                 
                        flow of communities                                   
                        released from the                                     
                        lien.                                                 

SUBORDINATED DISPOSI-   If our advisor or an    Not determi-    Not determi-  
TION FEE--OUR ADVISOR   affiliate provides a    nable at this   nable at this 
OR ITS AFFILIATES       substantial amount of   time.           time.         
                        the services (as                                      
                        determined by a                                       
                        majority of our Com-                                  
                        pany's independent                                    
                        directors) in                                         
                        connection with the                                   
                        sale of one or more                                   
                        properties, a fee                                     
                        equal to the lesser of                                
                        (A) 50% of the reason-                                
                        able, customary and                                   

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                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                          OPERATIONAL STAGE                                   
------------------------------------------------------------------------------
                        competitive real                                      
                        estate brokerage                                      
                        commissions                                           
                        customarily paid for                                  
                        the sale of a                                         
                        comparable property in                                
                        light of the size,                                    
                        type and location of                                  
                        the property, or                                      
                        (B) 3.0% of the sales                                 
                        price for each                                        
                        community sold. The                                   
                        subordinated dispo-                                   
                        sition fee will be                                    
                        paid only if                                          
                        stockholders have                                     
                        received (1) total                                    
                        dividends in an amount                                
                        equal to 100% of their                                
                        aggregate invested                                    
                        capital and (2) the                                   
                        Stockholder's 6.0%                                    
                        Return.                                               

SUBORDINATED SHARE OF   15.0% of remaining      Not determi-    Not determi-  
NET SALE PROCEEDS--OUR  amounts of net sale     nable at this   nable at this 
ADVISOR (3)             proceeds after          time.           time.         
                        stockholders have                                     
                        received distribu-                                    
                        tions equal to the sum                                
                        of (1) the                                            
                        Stockholder's 6.0%                                    
                        Return and (2) 100% of                                
                        net invested capital.                                 
                        Following listing on a                                
                        national securities                                   
                        exchange or a national                                
                        securities market, no                                 
                        subordinate share of                                  
                        net sale proceeds will                                
                        be paid to our                                        
                        advisor.                                              

SUBORDINATED INCENTIVE  Upon listing on a       Not determi-    Not determi-  
LISTING FEE--OUR ADVI-  national securities     nable at this   nable at this 
SOR (3)(4)(5)           exchange or a national  time.           time.         
                        securities market, a                                  
                        fee equal to 10.0% of                                 
                        the amount by which                                   
                        our adjusted market                                   
                        value of our common                                   
                        stock plus the total                                  
                        of all distributions                                  
                        paid from our                                         

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                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                          OPERATIONAL STAGE                                   
------------------------------------------------------------------------------
                        inception until the                                   
                        date of listing                                       
                        exceeds the sum of                                    
                        (1) 100% of invested                                  
                        capital and (2) the                                   
                        total distributions                                   
                        required to be paid to                                
                        the stockholders to                                   
                        pay the Stockholder's                                 
                        6.0% Return from                                      
                        inception through the                                 
                        date of listing.                                      

PROPERTY MANAGEMENT     3.5% to 4.0% of gross   Actual amounts  Actual amounts
FEE--AN AFFILIATE OF    income of each commu-   are dependent   are dependent 
GFS EQUITY MANAGEMENT   nity.                   upon results    upon results  
LLC, AN AFFILIATE OF                            of operations   of operations 
BAINBRIDGE                                      and therefore   and therefore 
JACKSONVILLE LLC AND                            cannot be       cannot be     
AN AFFILIATE OF                                 determined at   determined at 
ALLIANCE G.P. IV, INC.                          the present     the present   
AND BROADSTONE PRESTON                          time.           time.         
ALLIANCE LLC                                                                  

INCENTIVE MANAGEMENT    50% of all remaining    Actual amounts  Actual amounts
FEE--AN AFFILIATE OF    income from operations  are dependent   are dependent 
GFS EQUITY MANAGEMENT   of the communities in   upon results    upon results  
LLC AND AN AFFILIATE    excess of minimum cash  of operations   of operations 
OF BAINBRIDGE           distribution            and therefore   and therefore 
JACKSONVILLE LLC        thresholds set for      cannot be       cannot be     
                        each community,         determined at   determined at 
                        including $50 annually  the present     the present   
                        per apartment unit and  time.           time.         
                        either an 11% or 12%                                  
                        preferred return.                                     

INCENTIVE MANAGEMENT    20% of all remaining    Actual amounts  Actual amounts
FEE--AN AFFILIATE OF    income from operations  are dependent   are dependent 
ALLIANCE G.P. IV, INC.  of the community in     upon results    upon results  
AND BROADSTONE PRESTON  excess of the minimum   of operations   of operations 
ALLIANCE, INC.          cash distribution       and therefore   and therefore 
                        threshold and a 10%     cannot be       cannot be     
                        preferred return.       determined at   determined at 
                                                the present     the present   
                                                time.           time.         

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                                                  Estimated       Estimated   
       Type of                                     Minimum         Maximum    
     Compensation                                 Amount (1)      Amount (1)  
----------------------  ----------------------  ------------------------------
                                                                              
                          OPERATIONAL STAGE                                   
------------------------------------------------------------------------------
SALE PROCEEDS--BAIN-    For the Jacksonville    Actual amounts  Actual amounts
BRIDGE JACKSONVILLE     communities, an         are dependent   are dependent 
LLC, GFS EQUITY         affiliate of            upon results    upon results  
MANAGEMENT LLC AND AN   Bainbridge              of operations   of operations 
AFFILIATE OF ALLIANCE   Jacksonville LLC will   and therefore   and therefore 
G.P. IV, INC. AND       receive an advisory     cannot be       cannot be     
BROADSTONE PRESTON      services fee equal to   determined at   determined at 
ALLIANCE LLC            20% of our 93.75% of    the present     the present   
                        the remaining           time.           time.         
                        proceeds, and                                         
                        Bainbridge Jackson-                                   
                        ville LLC will receive                                
                        6.25% of any remaining                                
                        sale proceeds. For the                                
                        Portland and Salt Lake                                
                        City communities and                                  
                        Seattle communities,                                  
                        GFS Equity Management                                 
                        LLC will receive 25%                                  
                        of any remaining sale                                 
                        proceeds. For the                                     
                        Plano community,                                      
                        remaining sale pro-                                   
                        ceeds will be                                         
                        distributed to us and                                 
                        Alliance Resi-                                        
                        dential, LLC ratably                                  
                        until we have each                                    
                        received a 10%                                        
                        preferred return and                                  
                        then 80/20 until we                                   
                        have received a 13%                                   
                        return, 75/25 until we                                
                        have received a 16%                                   
                        return, 70/30 until we                                
                        have received a 20%                                   
                        return and then any                                   
                        residual sale                                         
                        proceeds, 60/40.                                      

Notwithstanding the method by which we calculate the payment of operating       
expenses, as described in the table above, the total of all such operating      
expenses will not exceed, in the aggregate, the greater of 2% of the book value 
of the assets or 25% of cash net income as required by the NASAA Guidelines.    

---------                                                                       

(1) The estimated minimum dollar amounts are based on the sale of a minimum of  
   250,000 shares to the public at $10 per share. The estimated maximum dollar
amounts are based on the sale of a maximum of 100,000,000 shares to the 
public at $10 per share. The sale of up to 5,000,000 shares at $9.30 per
share pursuant to our dividend reinvestment plan is excluded from those 
amounts.                                                                

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(2) Notwithstanding the method by which we calculate the payment of acquisition 
fees and expenses, as described in the table, the total of all such     
    acquisition fees and acquisition expenses will not exceed, in the aggregate,
    an amount equal to 6.0% of the contract price of all of the properties which
we purchase, as required by the NASAA Guidelines.                       

(3) In the event that we become listed on a national securities exchange or a   
  national market system and our advisor receives the subordinated incentive
listing fee prior to its receipt of the share of net sale proceeds, our 
    advisor will not be entitled to any such participation in net sale proceeds.

(4) If at any time the shares become listed on a national securities exchange or
  a national market system, or, notwithstanding the absence of such listing,
 our stockholders elect to continue our Company's existence after June 22,
2015, we will negotiate in good faith with our advisor a fee structure  
appropriate for an entity with a perpetual life. A majority of the      
    independent directors must approve any new fee structure negotiated with our
   advisor. In negotiating a new fee structure, the independent directors will
  consider all the factors they deem relevant, including but not limited to:

- the size of the advisory fee in relation to the size, composition and   
profitability of our portfolio;                                       

- the success of our advisor in generating opportunities that meet our    
investment objectives;                                                

- the rates charged to other REITs and to investors other than REITs by   
advisors performing similar services;                                 

- additional revenues realized by our advisor;                            

- the quality and extent of service and advice furnished by our advisor;  

   - the performance of our investment portfolio, including income, conservation
     or appreciation of capital, frequency of problem investments and competence
in dealing with distress situations; and                              

 - the quality of our portfolio in relationship to the investments generated
by our advisor for the account of other clients.                      

The board, including a majority of the independent directors, may not   
   approve a new fee structure that is, in its judgment, more favorable to our
advisor than the current fee structure.                                 

(5) The market value of our outstanding stock will be calculated based on the   
 average market value of the shares issued and outstanding at listing over
   the 30 trading days beginning 180 days after the shares are first listed on
  a stock exchange. We have the option to pay the listing fee in the form of
   stock, cash, a promissory note or any combination thereof. In the event the
    subordinated incentive listing fee is paid to our advisor as a result of the
listing of our shares, we will not be required to pay our advisor any   
further subordinated participation in net sale proceeds.                

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   In addition, our advisor and its affiliates will be reimbursed only for the
   actual costs of goods and services used for or by us. We will not reimburse
 our advisor or its affiliates for services for which they are entitled to
compensation by way of a separate fee.                                  

Since our advisor and its affiliates are entitled to differing levels of        
compensation for undertaking different transactions on behalf of our Company,   
such as the advisory fees for managing our affairs and the subordinated         
participation in net sale proceeds, our advisor has the ability to affect the   
nature of the compensation it receives by undertaking different transactions.   
However, our advisor is obligated to exercise good faith and integrity in all   
its dealings with respect to our affairs pursuant to the advisory agreement.    
(See "Management--Our Advisor--The Advisory Agreement.") Because these fees or  
expenses are payable only with respect to certain transactions or services, they
may not be recovered by our advisor or its affiliates by reclassifying them     
under a different category.                                                     

CONFLICTS OF INTEREST 

The Company will be subject to various conflicts of interest arising out of its 
relationship to our advisor and its affiliates, as described below.             

There are certain relationships between our Company and other entities providing
services to us. Our advisor is a wholly owned subsidiary of Boston Capital      
Holdings Limited Partnership. John P. Manning, our Chairman and Chief Executive 
Officer, owns the general partner of and a limited partner interest in Boston   
Capital Holdings Limited Partnership. Boston Capital Holdings Limited           
Partnership also owns 66 2/3% of the dealer-manager. BCP Funding, LLC, our      
line-of-credit lender, is a wholly owned subsidiary of Boston Capital Companion 
Limited Partnership. Mr. Manning also owns the general partner of and a limited 
partner interest in Boston Capital Companion Limited Partnership. Boston Capital
Companion Limited Partnership owns 20,000 shares of our common stock.           

GFS Equity Management LLC is an unaffiliated entity which is providing property 
management services for the Seattle and Portland/Salt Lake communities. In      
addition, on July 11, 2002, Goodman Financial Services, Inc., an affiliate of   
GFS Equity Management LLC, negotiated and entered into a purchase agreement for 
the Seattle communities from an unaffiliated seller for a purchase price of     
$51,366,000. In December, 2002, affiliates of our advisor agreed to acquire the 
Seattle communities from GFS Equity Management LLC for possible investment by a 
group of private investors. GFS Equity Management LLC agreed to assign its      
entire interest in the Seattle community purchase contracts to affiliates of our
advisor in return for the initial management contract for the communities. The  
subordinated interest was given to create an incentive to GFS Equity Management 
LLC as management agent to maximize the cash flow of the communities. The       

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subordinated economic interest allows GFS Equity Management LLC to participate  
in the cash distributions of the Seattle communities after Boston Capital REIT  
has received a priority share of the cash flow. Before GFS Equity Management LLC
receives any portion of the cash flow, we will receive:                         

(i) $50 annual per apartment unit (a total of 802 units times $50 equals      
$40,100 annually); and                                                

(ii) a 12% preferred return on our unreturned capital contributions (which    
initially were $8,626,939).                                         

We will then share 50/50 with GFS Equity Management LLC in all remaining income 
from operations of the Seattle communities. Proceeds from the sale of any of the
Seattle communities will first be distributed to pay us any unpaid preferred    
return. Remaining sale proceeds will be distributed to us until we have received
a return of our capital contributions (taking into account prior distributions) 
plus a 16% per annum rate of return on our capital contributions. We will then  
receive 75% and GFS Equity Management LLC will receive 25% of any remaining sale
proceeds.                                                                       

During the term of the current first mortgage loans on the Portland and Salt    
Lake City communities, GFS Equity Management LLC is entitled to be paid 0.06%   
per annum of the principal of the first mortgage loans from cash flow of        
BC-GFS-II-LLC as compensation to assume 100% of the risk of loss on the rate    
lock deposit paid to the permanent mortgage lender. Initially, the unaffiliated 
permanent mortgage lender agreed to provide mortgage lending for the Portland   
and Salt Lake City communities at a rate of 4.6% or 4.52%. A rate lock deposit  
fee of $786,000 was required for either of the rate caps. If the 4.6% rate was  
locked and we did not close on the loan, most of the rate lock deposit fee would
have been refunded. However, if the 4.52% rate was locked and we did not close  
on the loan, all of the rate lock deposit fee would not have been refunded. We  
wanted to lock in the lowest rate possible. In order to secure the lower rate   
and also to mitigate the risk of losing the rate lock deposit, GFS Equity       
Management LLC agreed to assume 100% of any rate lock deposit fee not refunded  
in return for receiving 75% of the spread between the two interest rates        
(0.06%), or approximately $23,600. This additional interest payment of 0.06% per
annum to GFS Equity Management LLC will be paid from cash flow throughout the   
duration of the permanent mortgage loans and is expected to be approximately    
$23,600 annually until maturity in June 2010.                                   

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PRIOR AND FUTURE PROGRAMS 

In the past, affiliates of our advisor have organized approximately 387 other   
real estate investment programs, currently have other real estate holdings, and 
in the future expect to form, offer interests in, and manage other real estate  
programs in addition to our Company, and make additional real estate            
investments. Currently, no affiliate of our advisor owns, operates, leases or   
manages properties that would be suitable for our Company, although future real 
estate programs may involve affiliates of our advisor in the ownership,         
financing, operating, leasing, and management of properties that may be suitable
for us. Such conflicts between our Company and affiliated programs may affect   
the value of our investments as well as our net income. We believe that our     
advisor has established guidelines to minimize such conflicts.                  

Competition to Acquire Properties 

Affiliates of our advisor may compete with us to acquire properties of a type   
suitable for acquisition by us and may be better positioned to make such        
acquisitions. A purchaser who wishes to acquire one or more of these properties 
may have to do so within a relatively short period of time, occasionally at a   
time when we (due to insufficient funds, for example) may be unable to make the 
acquisition.                                                                    

Our advisor or its affiliates also may be subject to potential conflicts of     
interest at such time as we wish to acquire a property that also would be a     
suitable investment for an affiliate of our advisor. Affiliates of our advisor  
serve as directors of our Company and, in this capacity, have a fiduciary       
obligation to act in the best interest of our stockholders and, as general      
partners or directors of affiliates of our advisor, to act in the best interests
of the investors in other entities or programs with investments that may be     
similar to those of our Company, and will use their best efforts to assure that 
we will be treated as favorably as any other entity or program. We have also    
developed procedures to resolve potential conflicts of interest in the          
allocation of properties between our Company and certain of its affiliates. See 
"Conflicts of Interest--Certain Conflict Resolution Procedures" below.          

Sales of Properties 

A conflict also could arise in connection with our advisor 's determination as  
to whether or not to sell a property, since the interests of our advisor and the
stockholders may differ as a result of their distinct financial and tax         
positions and the compensation to which our advisor or its affiliates may be    
entitled upon the sale of a property. See "Conflicts of Interest--              

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Compensation of our Advisor" below for a description of these compensation      
arrangements. In order to resolve this potential conflict, our board of         
directors will be required to approve each sale of a property.                  

Competition for Management Time 

The officers of our advisor and the directors and officers of our Company       
currently are engaged, and in the future will engage, in the management of other
business entities and properties and in other business activities, including    
entities, properties and activities associated with affiliates of our advisor.  
They will devote only as much of their time to the business of our Company as   
they, in their judgment, determine is reasonably required, which will be        
substantially less than their full time. These officers and directors of our    
advisor and officers and directors of the Company may experience conflicts of   
interest in allocating management time, services, and functions among the       
Company and the various entities, investor programs (public or private), and any
other business ventures in which any of them are or may become involved.        
Currently, in addition to their involvement with our Company, these persons are 
involved in the management of approximately 387 other real estate investment    
programs with interests in low-income residential apartment communities.        

Compensation of Our Advisor 

Pursuant to an advisory services agreement, we have engaged our advisor to      
perform various services for us, and our advisor will receive fees and          
compensation for such services. The advisory services agreement was not the     
result of arm's-length negotiations. The advisory services agreement was        
approved by a majority of our board of directors, including a majority of the   
independent directors, not otherwise interested in the transaction, as being    
fair and reasonable to our Company and on terms and conditions no less favorable
than those which could be obtained from unaffiliated entities. Any future       
agreements with our advisor, including any amendment or restatement of the      
advisory services agreement, will require the same approval. The timing and     
nature of fees and compensation to our advisor could create a conflict between  
the interests of our advisor and those of the stockholders. A transaction       
involving the purchase or sale of any community by our Company may result in the
immediate realization by our advisor and its affiliates of substantial          
commissions, fees, compensation, and other income. Although the advisory        
services agreement authorizes our advisor to take primary responsibility for all
decisions relating to any such transaction, our board of directors must approve 
all of the Company's acquisitions and sales of communities. Potential conflicts 
may arise in connection with the determination by our advisor on our behalf of  
whether to hold or sell a community as such determination could affect          

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the timing and amount of fees payable to our advisor. See "Management--Our      
Advisor--The Advisory Services Agreement."                                      

Relationship with Dealer-Manager

The dealer-manager is Boston Capital Securities, Inc., an affiliate of our      
advisor and our Company. Certain of our officers and directors are also         
officers, directors, and registered principals of the dealer-manager. This      
relationship may create conflicts in connection with the fulfillment by the     
dealer-manager of its due diligence obligations under the federal securities    
laws. Although the dealer-manager has examined the information in this          
prospectus for accuracy and completeness, the dealer-manager is an affiliate of 
our advisor and our Company and will not make an independent review of our      
Company or the offering. Accordingly, the investors do not have the benefit of  
such independent review. The dealer-manager is not prohibited from acting in any
capacity in connection with the offer and sale of securities offered by entities
that may have some or all investment objectives similar to those of our Company 
and is expected to participate in other offerings sponsored by one or more of   
our officers or directors.                                                      

Relationship with BCP Funding, LLC

Our current lender is BCP Funding, LLC, an affiliate of our advisor and our     
Company. Subject to oversight by our board of directors, our advisor has        
considerable discretion with respect to all decisions relating to the terms and 
timing of our borrowings from BCP Funding. Our board may encounter conflicts of 
interest in enforcing our rights or invoking our powers under our loan agreement
with BCP Funding. A majority of our independent directors must approve any      
agreement with BCP Funding as being fair and reasonable to us and on terms and  
conditions no less favorable to us than those available from an unaffiliated    
third party.                                                                    

Joint Ventures with Affiliates of Our Advisor 

While we have no present plans to do so, we may in the future enter into one or 
more joint venture agreements with other affiliated programs for the            
acquisition, development or improvement of properties. (See "Business and       
Properties--Joint Venture Investments.") Our advisor and its affiliates may have
conflicts of interest in determining which affiliated program should enter into 
any particular joint venture agreement. The co-venturer may have economic or    
business interests or goals which are or which may become inconsistent with our 
business interests or goals. In addition, should any such joint venture be      
consummated, our advisor may face a conflict in structuring the terms of the    
relationship between our interests and the interest of the affiliated           
co-venturer and in managing the joint venture. Since our advisor and its        
affiliates will control both our Company and the affiliated co-venturer,        
agreements and transactions between the                                         

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co-venturers with respect to any such joint venture will not have the benefit of
arm's-length negotiation of the type normally conducted between unrelated       
co-venturers. (See "Risk Factors--Risks Related to Our Properties and Our       
Business.").                                                                    

Legal Representation

Until August 16, 2005, Nixon Peabody LLP, served as our securities and tax      
counsel solely for this offering, and currently serves as securities and tax    
counsel for certain of our affiliates, including other real estate programs, in 
connection with other matters. Subsequent to August 16, 2005, we retained       
Goodwin Procter LLP to serve as our securities and tax counsel solely in        
connection with this offering. Neither we nor the stockholders will have        
separate counsel. In the event any controversy arises following the termination 
of this offering in which the interests of our Company appear to be in conflict 
with those of our advisor or its affiliates, other counsel may be retained for  
one or both parties.                                                            

Certain Conflict Resolution Procedures

In order to reduce or eliminate certain potential conflicts of interest, our    
articles of incorporation contain a number of restrictions relating to          
(i) transactions we enter into with our advisor and its affiliates,             
(ii) certain future offerings, and (iii) allocation of properties among         
affiliated entities. These restrictions include, among others, the following:   

- We will not accept goods or services from our advisor or its affiliates unless
a majority of our directors, including a majority of the independent        
directors, not otherwise interested in the transactions approve such        
  transactions as fair and reasonable to us and on terms and conditions not less
favorable to us than those available from unaffiliated third parties.       

- We will not purchase or lease properties in which our advisor or its          
affiliates has an interest without a determination by a majority of the     
directors, including a majority of the independent directors, not otherwise 
interested in such transaction, that such transaction is competitive and    
  commercially reasonable to us and at a price to us no greater than the cost of
the property to our advisor or its affiliates unless there is substantial   
 justification for any amount that exceeds such cost and such excess amount is
 determined to be reasonable. In no event will we acquire any such property at
an amount in excess of its appraised value. We will not sell or lease       
properties to our advisor or its affiliates or to our directors unless a    
 majority of the directors, including a majority of the independent directors,
  not otherwise interested in the transaction, determine the transaction is fair
and reasonable to our Company.                                              

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- We will not make any loans to our advisor or its affiliates or to our         
directors. Any loans made to us by our advisor or its affiliates or to our  
directors must be approved by a majority of the directors, including a      
majority of the independent directors, not otherwise interested in the      
transaction, as fair, competitive and commercially reasonable, and no less  
favorable to us than comparable loans between unaffiliated parties. Our     
 advisor and its affiliates are entitled to reimbursement, at cost, for actual
expenses incurred by them on our behalf subject to the limitation on        
  reimbursement of operating expenses to the extent that they exceed the greater
  of 2% of our average invested assets or 25% of our net income, as described in
  the "Management--Our Advisor--Our Advisory Services Agreement" section of this
prospectus.                                                                 

- In the event that an investment opportunity becomes available which is        
 suitable, under all of the factors considered by our advisor, for our Company
and one or more other public or private entities affiliated with our advisor
and its affiliates, then the entity which has had the longest period of time
elapse since it was offered an investment opportunity will first be offered 
such investment opportunity. In determining whether or not an investment    
opportunity is suitable for more than one program, our advisor, subject to  
  approval by the board of directors, shall examine, among others, the following
factors:                                                                    

- The cash requirements of each program;                                    

- The effect of the acquisition on diversification of each program's        
investments by type of apartment community and geographic area;         

- The policy of each program relating to leverage of properties;            

- The anticipated cash flow of each program;                                

- The income tax effects of the purchase of each program;                   

- The size of the investment; and                                           

- The amount of funds available to each program and the length of time such 
funds have been available for investment.                               

If a subsequent development, such as a delay in the closing of a property,      
causes any such investment, in the opinion of our board of directors and our    
advisor, to be more appropriate for a program other than the program that       
committed to make the investment, our advisor may determine that another program
affiliated with our advisor or its affiliates will make the investment. Our     
board of directors has a duty to ensure that the method used by our advisor for 
the allocation of the acquisition of properties by two or more affiliated       
programs seeking to acquire similar types of properties shall be reasonable.    

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Conflict Provisions of Maryland Law 

In addition to the policies that we have adopted to reduce or eliminate         
potential conflicts of interest (see "Conflicts of Interest--Certain Conflict   
Resolution Procedures" above), our board is subject to certain provisions of    
Maryland law, which are also designed to eliminate or minimize conflicts.       
However, we cannot assure you that these policies or provisions of law will be  
successful in eliminating the influence of these conflicts.                     

Under Maryland law, a contract or other transaction between us and any of our   
directors and any other entity in which that director is also a director or has 
a material financial interest is not void or voidable solely on the grounds of  
the common directorship or interest, the fact that the director was present at  
the meeting at which the contract or transaction is approved or the fact that   
the director's vote was counted in favor of the contract or transaction, if:    

- The fact of the common directorship or interest is disclosed to our board or a
committee of our board, and our board or that committee authorizes the      
contract or transaction by the affirmative vote of a majority of the        
disinterested directors, even if the disinterested directors constitute less
than a quorum;                                                              

- The fact of the common directorship or interest is disclosed to our           
 stockholders entitled to vote, and the contract or transaction is approved by
 a majority of the votes cast by the stockholders entitled to vote, other than
votes of shares owned of record or beneficially by the interested director, 
corporation, firm or other entity; or                                       

- The contract or transaction is fair and reasonable to us.                     

INVESTMENT POLICIES AND POLICIES WITH RESPECT TO CERTAIN
OTHER ACTIVITIES

The following is a discussion of our investment policies and our policies with  
respect to certain other activities. Our independent directors shall review, and
a majority of them must approve our investment policies at least annually to    
determine that the policies being followed are in the best interests of the     
stockholders. Our permitted investments and limitations are set forth in our    
articles. The permitted investments and limitations may not be modified or      
eliminated without the approval of stockholders holding a majority of the       
outstanding equity shares. We cannot assure you that our investment objectives  
will be attained.                                                               

Investments in Real Estate

We are a REIT that will own interests in, lease and maintain apartment          
communities in the United States, typically garden apartments and selected      
mid-rise properties having 150 or more rental units. We intend to               

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invest in properties which our advisor believes are undervalued mainly because  
of deferred maintenance or renovations which the seller has not performed. In   
such cases, we will need to raise sufficient funds to make any such deferred    
maintenance or renovations. We invest primarily in suburban and metropolitan    
areas.                                                                          

Our policy is to invest in assets primarily for current income generation. In   
general, our investment objectives are:                                         

- To provide quarterly cash distributions, as well as to provide growth in      
distributions over time.                                                    

  There is no assurance that any distribution will be paid. Rising operating
expenses could reduce our cash flow and funds available for future      
distribution.                                                           

- To increase our value through increases in the cash flows and values of our   
communities.                                                                

The performance of our properties may not meet our expectations. Adverse
   economic conditions and competition may impede our ability to renew leases,
which could affect our operating results.                               

- To preserve and protect the value of our interest in our communities and to   
achieve long-term capital appreciation.                                     

 There is no assurance of capital appreciation. We will only return all of
  our stockholders' invested capital if we sell our interests in communities
for more than their original purchase price.                            

There are no limitations on the amount or percentage of our total net assets    
that may be invested in any one community. Additionally, no limits have been set
on the concentration of investments in any one location. However, our advisor   
does plan to diversify its acquisitions to mitigate risk.                       

Apartment communities under consideration are first subjected to a comprehensive
due diligence review. In selecting specific communities, our advisor, as        
approved by our board of directors, applies the following minimum standards.    

- The apartment community is in what our advisor considers to be a quality      
market area within locations that provide stability and upside potential.   

- We will endeavor to maintain an aggregate mortgage indebtedness on our        
  communities totaling between 55% and 65% but in any event not more than 70% of
 our gross asset value, but this is not a limitation on the amount of mortgage
 indebtedness on any one community acquired, and we have no limitations in our
organizational documents regarding                                          

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the amount of mortgage and other borrowings on our communities, provided,   
  however, that the aggregate amount of our indebtedness outstanding at any time
may not exceed 300% of our net assets.                                      

- For communities acquired before the initial closing, the communities have at  
  least 18 months of stable operations; following the initial closing, we expect
  that not more than 10% of the communities will consist of development or other
properties that will not have at least 18 months of stable operations.      

Generally, we will acquire our interests in our communities by forming a limited
liability company which will be controlled by a wholly owned subsidiary of our  
Company and in which an unaffiliated third party will have an economic interest.
A wholly owned subsidiary of this limited liability company will in turn own    
title to the community.                                                         

Borrowing Policies

While we strive for diversification, the number of different communities we can 
acquire interests in will be affected by the amount of funds available to us.   
There is no limitation on the amount we may invest in any single improved       
property or on the amount we can borrow for the purchase of an interest in any  
property, provided, however, that the aggregate amount of our indebtedness      
outstanding at any time may not exceed 300% of our net assets.                  

We currently intend to limit the aggregate mortgage debt on our communities that
are no longer (or have not been) financed with our current or any replacement   
line of credit to be within the targeted range of 55% to 65%. In any event,     
aggregate borrowings as of the time that the net proceeds of this offering have 
been fully invested and at the time of each subsequent borrowing may not exceed,
on average, 70% of the gross asset value of those communities unless any excess 
borrowing is approved by a majority of the independent directors and is         
disclosed to stockholders in our next quarterly report.                         

We will, at least initially, borrow money to acquire interests in communities   
and to pay certain related fees. We plan to maintain one or more lines of credit
for the purpose of acquiring interests in communities. We intend to encumber our
assets in connection with the borrowing. Initially, we intend to repay any line 
of credit with offering proceeds. We also plan to obtain permanent mortgage     
financing for all of our communities, or to continue the existing mortgage      
indebtedness on the communities.                                                

Management believes that any financing obtained during the offering period will 
allow us to make investments in communities that we otherwise would be forced to
delay until we raised a sufficient amount of                                    

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proceeds from the sale of shares. By eliminating this delay, we will also       
eliminate the risk that these investments will no longer be available, or the   
terms of the investment will be less favorable, when we have raised sufficient  
offering proceeds. Alternatively, affiliates of our advisor could make such     
investments, pending receipt by us of sufficient offering proceeds in order to  
preserve the investment opportunities for us. However, interests in communities 
acquired by us in this manner could be subject to closing costs both on the     
original purchase by the affiliate and on the subsequent purchase by us, which  
would increase the amount of expenses associated with the acquisition of        
communities and reduce the amount of offering proceeds available for investment 
in other income-producing assets.                                               

While we have no present plans to do so, we may in the future establish a line  
of credit principally to finance capital improvement projects and for working   
capital purposes, such as the costs of renovating, repairing, and marketing our 
communities. We may also borrow funds for the purpose of preserving our status  
as a REIT. For example, we may borrow to the extent necessary to permit us to   
make distributions required in order to enable us to qualify as a REIT for      
federal income tax purposes.                                                    

We expect that all of our communities will also be encumbered with mortgage     
debt. By operating on a leveraged basis, we will have more funds available for  
investment in communities. This will allow us to make more investments than     
would otherwise be possible, resulting in a more diversified portfolio. Although
any liability for the repayment of mortgage indebtedness is expected to be      
limited to the value of the property securing the liability and the rents or    
profits derived therefrom, our use of leveraging increases the risk of default  
on the mortgage payments and a resulting foreclosure of a particular property.  
(See "Risk Factors--Risks Related to Our Organization and Structure.") To the   
extent that mortgage loans are not maintained on our communities, our ability to
acquire additional communities will be restricted. Our advisor will use its best
efforts to obtain financing on the most favorable terms available to us. Lenders
may have recourse to assets not securing the repayment of the indebtedness.     

Our advisor may refinance communities during the term of a loan when it deems it
is in the best interests of our Company, for example, when a decline in interest
rates makes it beneficial to prepay an existing mortgage or if an attractive    
investment becomes available and the proceeds from the refinancing can be used  
to purchase such investment. The benefits of the refinancing may include an     
increased cash flow resulting from reduced debt service requirements, an        
increase in dividend distributions from proceeds of the refinancing, if any,    
and/or an increase in property ownership if some refinancing proceeds are       
reinvested in real estate.                                                      

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Our aggregate borrowing, secured and unsecured, will be reasonable in relation  
to our assets and will be reviewed by our board of directors at least quarterly.

Any loans from any of our directors or from our advisor and its affiliates must 
be approved by a majority of the directors, including a majority of the         
independent directors, not otherwise interested in the transaction, as fair,    
competitive and commercially reasonable and no less favorable to us than        
comparable loans between unaffiliated parties. We will not make loans to the    
directors, officers, our advisor or their affiliates.                           

Dispositions

Although we generally will not seek to dispose of our interests in communities  
in our portfolio, we will consider doing so, subject to REIT qualification      
rules, if our management determines that a sale of our interest in a community  
would be in our best interests based on the price being offered for the         
community, the operating performance of the community, the tax consequences of  
the sale and other factors and circumstances surrounding the proposed sale. We  
may consider offering purchase money financing in connection with the sale of   
communities where the provision of that financing would increase the value to be
received by us for the community sold.                                          

Equity Capital Policies 

Our board has the authority, without further stockholder approval, to issue     
additional authorized shares of common stock and preferred stock or otherwise   
raise capital, including through the issuance of senior securities, in any      
manner and on those terms and for that consideration it deems appropriate,      
including in exchange for property. Existing stockholders will have no          
preemptive right to shares of common stock or other shares of our capital stock 
issued in any offering, and any offering might cause a dilution of a            
stockholder's investment in us. Although we have no current plans to do so,     
other than in connection with our dividend reinvestment plan, we may in the     
future issue common stock.                                                      

We may, in certain circumstances, purchase shares of our common stock in private
transactions with our stockholders, if those purchases are approved by our      
board. Our board has no present intention of causing us to repurchase any       
shares, and any action would only be taken in conformity with applicable federal
and state laws and the applicable requirements for qualifying as a REIT.        

Reporting Policies

After this offering, we will become subject to the full information reporting   
requirements of the Securities Exchange Act of 1934, as amended.                

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Pursuant to these requirements, we will file periodic reports, proxy statements 
and other information, including certified financial statements, with the       
Securities and Exchange Commission. See "Where You Can Find More Information."  
We have also established an internet-accessible area for our Company on the     
website of Boston Capital Corporation, www.bostoncapital.com. The information on
our website does not constitute a part of this prospectus.                      

Investment Limitations

We do not intend to invest in the securities of other issuers for the purpose of
exercising control (except to the extent that we may acquire the controlling    
securities of an entity holding real property that meets our investment         
criteria), to underwrite securities of other issuers, or to engage in the       
purchase and sale (or turnover) of investment securities in exchange for        
property, nor do we have any present intention of offering securities in        
exchange for property or to invest in real estate mortgages, although our board 
may determine to authorize an exchange of securities for property or an         
investment in mortgages in the future.                                          

PRIOR PERFORMANCE OF AFFILIATES OF MANAGEMENT 

Overview

During their more than 30-year history, our advisor and its affiliates and their
respective predecessors in interest have raised approximately $4.1 billion in   
real estate equity from approximately 87,400 investors in approximately 387     
investment programs to acquire interests in approximately 2,571 properties      
containing approximately 139,000 apartment units in 48 states and territories,  
representing approximately $10.7 billion in original development and acquisition
costs. Of the properties acquired, 146 were apartment complexes that included   
3,621 market rate units out of a total of 17,164 units located in 35 states and 
representing $389,689,415 of investor equity. The investment objectives of these
programs were to create certain tax benefits in the form of low-income or       
rehabilitation tax credits or tax losses. NONE OF THESE PROGRAMS HAD INVESTMENT 
OBJECTIVES SIMILAR TO OUR COMPANY'S, HOWEVER ALL OF THESE PROGRAMS INVOLVED     
RESIDENTIAL APARTMENT COMMUNITIES. Although none of them were 100% market rate  
communities, approximately 3,621 units in these residential apartment           
communities were market rate units. In addition, the market rate component of   
these programs were neither evaluated nor acquired in connection with programs  
that have similar investment objectives to our Company.                         

During the ten-year period from January 1, 1995 to December 31, 2004, our       
advisor and its affiliates and their respective predecessors in interest have   
served as general partners of two public limited partnership (which             

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includes 27 series) and 46 private limited partnerships including 29 corporate  
limited partnerships and 17 direct placement corporate limited partnerships for 
a total of 48 real estate programs. The residential apartment communities       
invested in by the previous programs are affordable housing communities subject 
to certain rent and tenant restrictions, of which a component is market rate    
units. Typically, the market rate units (if any), are less than 50% of the total
units in the community.                                                         

Our advisor and its affiliates and their respective predecessors in interest    
raised $2,914,614,056 in subscriptions from 42,966 investors during this        
ten-year period. A total of 1,043 properties (1), with a total development cost 
of $5,288,053,984 were acquired for the public and private limited partnerships.
These properties are geographically located 12% in the Northeast, 11% in the    
Mid-Atlantic, 27% in the Southeast, 24% in the Midwest, 16% in the Southwest,   
and 10% in the West.                                                            

The foregoing information covering the period from January 1, 1995 to           
December 31, 2004, can be summarized as follows:                                

                                                        [Enlarge/Download Table]

     PROGRAMS               PROPERTIES                  INVESTORS                      
-------------------  -------------------------  -------------------------     Average  
                                    Total                                     Capital  
                                 Development                                 Invested  
Type        Number    Number         Cost        Number       Capital      Per Property
----        ------    ------         ----        ------       -------      ------------
                                                                                       
Public...      2        470     $1,567,577,496   42,774    $  843,735,920   $1,795,183 
Private...    46        573     $3,720,476,488      192    $2,070,878,136   $3,614,098 
Total....     48      1,043     $5,288,053,984   42,966    $2,914,614,056   $2,794,453 

REGIONS 

                                                                [Download Table]

           Northeast  Mid-Atlantic  Southeast  Midwest  Southwest  West
           ---------  ------------  ---------  -------  ---------  ----
                                                                       
Public...       5%          4%          11%       12%        8%      4%
Private...      7%          7%          16%       12%        8%      6%
Total....      12%         11%          27%       24%       16%     10%

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All these 46 prior limited partnerships have invested in apartment complexes (or
operating partnerships which owned such complexes) financed and/or operated with
one or more forms of government subsidy, primarily RHS. The states in which     
these apartment complexes are located and the number of properties in each state
are as follows:(1)                                                              

                                                                [Download Table]
                             
Alabama.................    9
Arizona.................    9
Arkansas................   18
California..............   53
Colorado................   27
Connecticut.............   19
Delaware................    2
District of Columbia....    3
Florida.................   16
Georgia.................   49
Idaho...................    1
Illinois................   15
Indiana.................   12
Iowa....................    6
Kansas..................   18
Kentucky................   57
Louisiana...............   88
Maine...................   11
Maryland................   17
Massachusetts...........   14
Michigan................   53
Minnesota...............    3
Mississippi.............   46
Missouri................   37
Montana.................    1
Nebraska................    2
Nevada..................    3
New Hampshire...........    6
New Jersey..............   16
New Mexico..............    4
New York................   60
North Carolina..........   11
North Dakota............   14
Ohio....................    4
Oklahoma................   35
Oregon..................    2
Pennsylvania............   16
Puerto Rico.............    4
Rhode Island............    1
South Carolina..........    5
South Dakota............    1
Tennessee...............   15
Texas...................   97
Utah....................    3
Vermont.................    4
Virginia................   43
Virgin Islands..........   10
Washington..............    3
West Virginia...........    7
Wisconsin...............    5
Wyoming.................    0

----------                                                                      

(1) Includes 75 properties which are jointly owned by two or more investment    
 partnerships or series within an investment partnership which represent a
total of 88 shared investments.                                         

(2) The total number of properties by state does not reflect the 88 shared      
investments of 75 operating partnerships. The net number of properties  
reflected is 955.                                                       

The 48 government-assisted partnerships which invested in residential apartment 
complexes accounted for 100% of the total development cost of all properties    
acquired by all limited partnerships sponsored over the ten-year period.        

The investment objectives of the 48 prior partnerships were, in order of        
priority: (1) certain tax benefits in the form of tax losses or low-income      
housing and rehabilitation tax credits which each such limited partnership's    
partners might use to offset income from other sources; (2) long-term capital   
appreciation through increases in the value of each apartment complex and       
(3) cash distributions through potential sale or refinancing transactions.      
Distributions of current cash flow were not a primary objective of these        
partnerships, in that the government agencies which provide subsidies regulate  
both the amount of rent and the amount of cash distributions which may be made  
to partners.                                                                    

Private Placements

Interests in 46 of the 48 limited partnerships described above were sold to     
approximately 192 investors in private offerings intended to be exempt from the 
registration requirements of the Securities Act of 1933. A total of             

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$2,070,878,136 in subscriptions was raised. Interests were acquired in a total  
of 573 properties, with total development costs of $3,720,476,488.              

The private limited partnerships involved new construction or renovation of     
apartment complexes, financed with mortgage indebtedness aggregating            
approximately $2,078,291,819 in addition to the equity investment of the prior  
limited partnerships of $2,070,878,136. The purchased properties equaled 100% of
the total development cost of all non-conventional properties invested in by    
private limited partnerships.                                                   

Public Offerings

Interests in 27 series of the 2 limited partnerships described above were sold  
to approximately 42,774 investors in public offerings registered under the      
Securities Act of 1933. A total of $843,735,920 in subscriptions was raised. A  
total of 470 properties were purchased at a total development cost of           
$1,567,577,496.                                                                 

Information regarding the public offerings is summarized as follows as of       
December 31, 2004:                                                              

                                                        [Enlarge/Download Table]

                              Investors                 Properties                  Type of Properties       
                       --------------------------------------------------------------------------------------
                                                                Total                                        
                                                               Develop-      Recently      Under     Historic
                                                                 ment          Com-        Con-        Tax   
Program                 Number      Capital       Number         Cost         pleted     struction    Credit 
-------------------------------------------------------------------------------------------------------------
                                                                                                             
Boston Capital Tax                                                                                           
  Credit Fund IV L.P.                                                                                        
  (Series 23 through                                                                                         
  46)................   38,678    $752,939,880     442      $1,386,287,277      437          4          1    
Boston Capital Tax                                                                                           
  Credit Fund V L.P.                                                                                         
  (Series 47 through                                                                                         
  49)................    4,096    $ 90,796,040      28      $  181,290,219        6         22          0    

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During the four-year period ending December 31, 2004, affiliates of our         
management sponsored two public investment partnership with investment          
objectives similar to the 48 described above. This public limited partnership   
owns interests in 157 operating partnerships which include 15 properties jointly
owned by two or more investment partnerships or series within an investment     
partnership, representing a total of 17 shared investments. The total number of 
properties by state does not duplicate the 15 shared investments. The net number
of properties reflected is 140 located in:                                      

                                                                [Download Table]
                             
Alabama.................    1
Arizona.................    2
Arkansas................    0
California..............    4
Colorado................   13
Connecticut.............    1
Florida.................    0
Georgia.................    5
Illinois................    5
Indiana.................    1
Iowa....................    1
Kansas..................    7
Kentucky................   16
Louisiana...............    7
Maine...................    1
Maryland................    1
Massachusetts...........    1
Michigan................   13
Minnesota...............    0
Mississippi.............    4
Missouri................    5
Montana.................    0
Nebraska................    0
Nevada..................    0
New Hampshire...........    2
New Jersey..............    0
New Mexico..............    1
New York................    8
North Carolina..........    0
North Dakota............    1
Ohio....................    0
Oklahoma................    7
Oregon..................    1
Pennsylvania............    1
Puerto Rico.............    0
Rhode Island............    0
South Carolina..........    0
South Dakota............    1
Tennessee...............    1
Texas...................   16
Utah....................    0
Vermont.................    0
Virginia................    5
Virgin Islands..........    2
Washington..............    2
West Virginia...........    3
Wisconsin...............    1

All of the operating partnership acquisitions of the public limited partnership 
involved new construction or renovation of existing apartment complexes,        
financed with government-assisted mortgaged indebtedness aggregating            
approximately $309,967,791 in addition to the equity investment of the investing
partnerships of $306,774,420. These properties equaled 100% of the total        
development cost of properties acquired by public limited partnerships in the   
four-year period ended December 31, 2004. We will provide a more detailed       
description of these acquisitions to you upon request.                          

Information regarding public limited partnerships organized with investment     
objectives not similar to ours is contained in Appendix I--Tabular Information  
Concerning Prior Limited Partnerships.                                          

Any investor or prospective investor may view and/or obtain a copy of the most  
recent Form 10-K or Form 10-Q filed with the Securities and Exchange Commission 
relative to the public offerings at the Web site of Boston Capital Corporation, 
www.bostoncapital.com.                                                          

Diversification with Real Estate

We believe that investments in real estate through companies like ours can be an
attractive asset class to diversify an investor's portfolio beyond stocks and   
bonds. Diversification is a portfolio strategy designed to reduce               

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exposure to risk by combining a variety of investments, such as stocks, bonds,  
and real estate, which are unlikely to all move in the same direction. The goal 
of diversification is to reduce the risk in a portfolio. One way to diversify an
existing portfolio of stocks and bonds is to add real estate. We believe real   
estate has a low correlation to traditional stock and bond markets and          
therefore, combining all investment types, will result in a more stable         
portfolio.                                                                      

Not only can a portfolio be diversified by a variety of investment types such as
stocks, bonds and real estate, but diversification can also be achieved through 
various asset classes (apartments vs. commercial or industrial) and sponsors.   
Similar to investing in stocks, an investor is advised against buying for       
example, large cap growth stocks only, but to diversify with value, small,      
mid-cap and international stocks. The same theory of diversification can be     
applied to REITs. An investment in a publicly registered, non-traded REIT like  
our Company, which is unlisted and not actively traded, can be beneficial       
because our share price is not subject to daily market fluctuations as is       
generally the case for actively traded securities such as stocks and bonds. We  
believe this can be particularly beneficial for investors who consider investing
in real estate as a long-term investment.                                       

In addition, real estate is considered to be a good hedge against inflation and 
we believe the apartment sector is an ideal real estate type to hedge inflation 
because the short-term nature of apartment leases provides apartment owners with
the ability to frequently increase the rents they charge to tenants, most often 
on an annual basis. This unique feature of apartments allows landlords to keep  
rental income in-line and consistently ahead of annual increases to operating   
costs due to inflation in comparison to other property types such as industrial 
office and retail which generally have longer-term leases. As a result, any     
additional revenue in excess of costs should increase the amount of cash        
available for distribution to our stockholders. However, our actual results of  
operations and, accordingly, cash available for distribution, will be affected  
by a number of factors, including the revenue we receive from our communities,  
our operating expenses, our debt obligations, interest expense, the ability of  
our residents to meet their obligations, and unanticipated expenditures.        

Consistent Annual Risk-Adjusted Returns--Low Volatility                         

Historically, the multifamily sector has delivered consistent annual returns and
has exhibited less volatility than the Standard & Poor's 500 Index ("S&P 500")  
and the NAREIT Equity REIT Index ("NAREIT Index") as shown in the chart below.  
Our advisor believes that an investment in Boston Capital REIT can be viewed as 
an investment in a portfolio of properties whose value is tied to the           
performance of those properties and                                             

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their asset value. This stands in contrast to an investment in the companies or 
REITs which make up the S&P 500 and the NAREIT Index, which generally are not as
closely tied to the direct, underlying property or company values and are       
subject to daily market fluctuations, as well as long-term market cycles.       
Accordingly, our advisor believes that an investment in Boston Capital REIT will
exhibit less performance volatility than an investment in the companies or REITs
which make up the other two indices. While the NCREIF Property                  
Index--Multifamily is not a measure of non-traded REIT performance, our advisor 
believes that this index is an appropriate and accepted index for purposes of   
evaluating the relative volatility of an investment in our stock as compared to 
an investment in listed REIT shares or the S&P 500.                             

Return on Investment by Property Type 
Compared to Selected Indexes (1990-2004)

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC                     

                                                        [Enlarge/Download Table]

         THE NCREIF        THE NCREIF        THE NCREIF        THE NCREIF                                             
      PROPERTY INDEX--  PROPERTY INDEX--  PROPERTY INDEX--  PROPERTY INDEX--  THE STANDARD & POOR'S  THE NAREIT EQUITY
        MULTIFAMILY          RETAIL            OFFICE          INDUSTRIAL           500 INDEX           REIT INDEX    
                                                                                                                      
1990             5.80%             5.96%            -1.06%             1.95%                 -3.10%            -15.35%
1991            -1.35%            -1.86%           -11.44%            -3.87%                 30.47%             35.70%
1992             1.72%            -2.25%            -8.05%            -4.47%                  7.62%             14.59%
1993             8.72%             4.83%            -3.95%            -0.75%                 10.08%             19.65%
1994            12.07%             6.01%             3.92%             7.65%                  1.32%              3.17%
1995            11.67%             3.99%             7.19%            12.30%                 37.58%             15.27%
1996            11.54%             4.86%            13.57%            13.56%                 22.96%             35.27%
1997            12.89%             8.53%            17.86%            15.92%                 33.36%             20.26%
1998            14.09%            12.90%            19.62%            15.82%                 28.58%            -17.50%
1999            11.71%             9.54%            12.29%            11.64%                 21.04%             -4.62%
2000            12.93%             7.76%            14.08%            13.99%                 -9.10%             26.37%
2001             9.31%             6.74%             7.03%             9.33%                -11.89%             13.93%
2002             8.69%            13.69%             2.78%             6.71%                -22.10%              3.80%
2003             8.90%            17.14%             5.67%             8.22%                 28.68%             37.14%
2004            13.04%            22.95%            12.01%            12.07%                 10.88%             31.57%

Indexes 1-4: The NCREIF Property Indexes are composite total rate of return     
measures of investment performance (composed of Income Return, Capital Value    
Return and Total Return) of a very large pool of individual properties in the   
multifamily*, retail, office and industrial sectors, respectively, acquired in  
the private market and held in a fiduciary environment for investment purposes  
only.                                                                           

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* The performance results shown for the NCREIF Property Index--Multifamily      
should not be taken to represent the expected performance of Boston Capital     
REIT. Unlike Boston Capital REIT, the NCREIF Property Index--Multifamily and the
other indices described here do not have any fees or expenses. As such, the     
NCREIF Property Index--Multifamily reflects higher returns than shareholders are
likely to experience because the management fees and expenses we pay will reduce
the amount of cash available for distributions to our shareholders. You can not 
invest directly in an index. While Boston Capital REIT has used and expects to  
continue to use leverage (borrowing a portion of the purchase price of our      
property acquisitions), as do many of the properties in the NCREIF Property     
Index--Multifamily, the performance results shown for that index are adjusted to
show all properties on an unleveraged basis. Also, because we are a non-traded  
REIT, you will not be able to realize appreciation in the value of our          
portfolio, if any, until we liquidate or list our stock for trading. In         
addition, the aggregate property characteristics of Boston Capital REIT differ  
from those of the NCREIF Property Index--Multifamily, which will result in      
performance differences between that index and Boston Capital REIT.             

Index 5: The Standard & Poor's 500 Index is an unmanaged,                       
capitalization-weighted index of 500 stocks. The index is designed to measure   
performance of the broad domestic economy through changes in the aggregate      
market value of 500 stocks representing all major industries and is adjusted to 
reflect dividends paid.                                                         

Index 6: The NAREIT Equity REIT Index is an unmanaged, market-weighted index of 
tax-qualified Real Estate Investment Trusts traded on the New York Stock        
Exchange, the American Stock Exchange and the NASDAQ National Market System,    
including dividends.                                                            

SOURCES: STANDARD & POOR'S. RUSSELL-MELLON. NCREIF. THE NATIONAL COUNCIL OF REAL
ESTATE INVESTMENT FIDUCIARIES (NCREIF) WAS ESTABLISHED TO SERVE THE             
INSTITUTIONAL REAL ESTATE INVESTMENT COMMUNITY AS A COLLECTOR, PROCESSOR,       
VALIDATOR, AND DISSEMINATOR OF REAL ESTATE PERFORMANCE INFORMATION. CERTAIN DATA
AND PERFORMANCE RESULTS SHOWN WERE SUPPLIED BY OUTSIDE SOURCES AND ARE BELIEVED 
TO BE RELIABLE BUT ARE NOT GUARANTEED. PAST PERFORMANCE IS NO GUARANTEE OF      
FUTURE RESULTS.                                                                 

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PRINCIPAL STOCKHOLDERS

The following table sets forth certain information regarding the beneficial     
ownership of our common stock before and after this offering as of March 31,    
2006. The principal address of each person and entity named below is c/o Boston 
Capital Real Estate Investment Trust, Inc., c/o Boston Capital Corporation, One 
Boston Place, Suite 2100, Boston, MA 02108-4406.                                

                                                        [Enlarge/Download Table]

                                      Number of      Percent                                
                                        Shares          of        Number of      Percent of 
                                        Owned       All Shares      Shares       All Shares 
                                       Prior to      Prior to    Owned After       After    
Name of Beneficial Owner**           Offering (1)    Offering    Offering (1)   Offering (2)
                                                                                            
--------------------------------------------------------------------------------------------
Boston Capital Companion Limited                                                            
  Partnership......................     20,000          97%         20,000            * (3) 
John P. Manning....................       None          --              --            *     
Jeffrey H. Goldstein...............       None          --              --            *     
Kevin P. Costello..................       None          --              --            *     
Richard J. DeAgazio................       None          --              --            *     
Marc N. Teal.......................       None          --              --            *     
Mark W. Dunne......................       None          --              --            *     
Eileen P. O'Rourke.................       None          --              --            *     
Philip S. Cottone..................      2,000 (4)       *           2,000 (4)        *     
Kevin C. Phelan....................      1,000 (4)       *           1,000 (4)        *     
Nicholas L. Iacuzio................      1,000 (4)       *           1,000 (4)        *     
Directors and Executive Officers as                                                         
  a group (10 persons).............      4,000 (4)       *           4,000 (4)        *     

----------                                                                      

*   Less than 1%                                                                

**  John P. Manning, our Chairman and Chief Executive Officer, owns the sole    
 general partner interest of and a controlling limited partner interest in
Boston Capital Companion Limited Partnership. Jeffrey H. Goldstein,     
    Kevin P. Costello and Richard J. DeAgazio also own limited partner interests
in Boston Capital Companion Limited Partnership.                        

(1) In accordance with 13d-3 under the Securities Exchange Act of 1934, shares  
are shown as beneficially owned if the person named in the table has or 
    shares the power to vote or to direct the voting of, or the power to dispose
 or to direct the disposition of, those shares. Inclusion of shares in the
table does not necessarily mean that the persons named have any economic
   interest in shares set opposite their names. In addition, shares are deemed
    to be beneficially owned by a person if that person has the right to acquire
  shares, for example, upon exercise of an option or warrant, within 60 days
of the date as of which the information is provided. In computing the   
percentage ownership of any person, the amount of shares is deemed to   
   include the amount of shares beneficially owned by that person, and only by
that person, by reason of that acquisition right. As a result, the      
percentage of outstanding shares of any person as shown on the preceding
  table does not necessarily reflect the person's actual voting power at any
particular date.                                                        

(2) Assumes 100,000,000 shares are sold in offering.                            

(3) Approximately 8.0% if no more than the 250,000-share minimum is sold.       

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(4) Currently exercisable options. Assuming only the minimum of 250,000 shares  
 are sold and such director exercises his options, each such director will
   own less than 1% of the outstanding number of shares at the initial closing
   of the offering. We have granted 20,000 stock options, of which 4,000 stock
 options were exercisable as of December 31, 2005. Other than options, the
directors do not own any other shares.                                  

DESCRIPTION OF CAPITAL STOCK
General 

We were formed under the laws of the State of Maryland. Rights of our           
stockholders are governed by the Maryland General Corporation Law, or MGCL, our 
charter, or our articles, and our bylaws. The following summary of the material 
provisions of our capital stock does not purport to be complete and is subject  
to and qualified in its entirety by reference to our articles and bylaws, copies
of which are filed as exhibits to the registration statement of which this      
prospectus is a part.                                                           

Authorized Stock

Our articles provide that we may issue up to 400,000,000 shares of common stock,
par value $.001 per share, 50,000,000 shares of preferred stock, par value $.001
per share, and 50,000,000 shares of "excess stock," par value $.00l per share,  
which would be issued only in the event we have purchases in excess of the      
ownership limits described below. At the commencement of this offering, 20,000  
shares of our common stock were issued and outstanding, all of which were owned 
by an affiliate of our advisor, and no excess shares were issued and            
outstanding.                                                                    

We will not issue stock certificates. Each stockholder's investment will be     
recorded on our books, and information concerning the restrictions and rights   
attributable to shares (whether in connection with an initial issuance or a     
transfer) will be sent to the stockholder receiving shares in connection with   
the issuance or transfer. A stockholder wishing to transfer his or her shares   
will be required to send appropriate documentation to us, and we will provide   
the required documentation upon a stockholder's request. The transfer will be   
effective and the transferee of the shares will be recognized as the holder of  
such shares within five business days of our receipt of the required            
documentation, subject to restrictions in our articles of incorporation.        

Common Stock

In the opinion of Goodwin Procter LLP, a copy of which is attached as an exhibit
to Post-Effective Amendment No. 2 to the Registration Statement, filed on       
December 7, 2005, all of the shares offered by our prospectus will be validly   
issued, fully paid and nonassessable. Subject to the preferential rights of any 
other class or series of shares of stock, holders of                            

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shares of common stock will be entitled to receive distributions if, as and when
authorized and declared by our board out of assets legally available for such   
payments and to share ratably in our assets legally available for distribution  
to the stockholders in the event of our liquidation, dissolution or winding-up  
after payment of, or adequate provision for, all of our known debts and         
liabilities and any rights of holders of senior securities.                     

Each outstanding share of common stock entitles the holder to one vote on all   
matters submitted to a vote of our stockholders, including the election of      
directors. There is no cumulative voting in the election of directors, which    
means that directors then standing for election will be elected by a plurality  
of all votes cast. Holders of shares of common stock have no conversion, sinking
fund, redemption, exchange or appraisal rights, and have no preemptive rights to
subscribe for any of our securities.                                            

Preferred Stock; Other Equity Securities

We conducted an offering of 173 shares of 12.0% Series A Cumulative Non-Voting  
Preferred Stock at $500 per share through a private placement conducted in      
reliance on the exemption from registration set forth in Section 4(2) of the    
Securities Act of 1933, as amended and Rule 506 of Regulation D promulgated     
thereunder. We offered and sold the preferred shares to investors whom we had   
reasonable grounds to believe are "accredited investors" within the meaning of  
Rule 501 of Regulation D. The offering was effected pursuant to the articles    
supplementary to our articles of incorporation and for the purpose of having at 
least 100 shareholders to satisfy one of the qualifications we must meet in     
order to qualify as a real estate investment trust under the Internal Revenue   
Code. Under Sections 856(a)(5), 856(b) and 856(h)(2) of the Internal Revenue    
Code, the beneficial ownership of a REIT must be held by 100 or more persons    
during at least 335 days of a taxable year of 12 months (or during a            
proportionate part of a taxable year of less than 12 months), other than with   
respect to the first taxable year for which a REIT election is made (which in   
our case is anticipated to be the taxable year ended December 31, 2005). The    
outstanding preferred shares are subject to redemption, in whole or in part, at 
any date which is at least one year following the sale of such preferred shares 
(the "Redemption Date") by notice of such redemption by us. If we elect to      
redeem the preferred shares, each preferred share will be redeemed for a price, 
payable in cash on the Redemption Date, equal to $500, plus all accrued and     
unpaid dividends. This offering closed on January 30, 2006.                     

Additional shares of preferred stock may be issued from time to time, in one or 
more series, as authorized by our board without further action by our           
stockholders, unless action by our stockholders is required by applicable law or
by the rules of any securities exchange or market on which our                  

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shares may be listed in the future. Prior to the issuance of shares of each     
series, our board is required by the MGCL and our articles to fix for each      
series, subject to the provisions of our articles, the terms, preferences,      
conversion or other rights, voting powers, restrictions, limitations as to      
dividends, qualifications and terms or conditions of redemption, as permitted by
Maryland law. Because our board has the power to establish the preferences,     
powers and rights of each series of preferred stock, it may afford the holders  
of any series of preferred stock preferences, powers and rights senior to the   
rights of holders of shares of our common stock; however, the voting rights for 
each share of preferred stock shall not exceed voting rights which bear the same
relationship to the voting rights of shares of our common stock as the          
consideration paid to our Company for each share of preferred stock bears to the
book value of shares of our common stock on the date that such preferred stock  
is issued. The issuance of preferred stock could have the effect of delaying or 
preventing a change of control of our Company that might involve a premium price
for holders of shares or otherwise be in their best interest. Our board has no  
present plans to issue any preferred stock.                                     

The voting rights per share of our equity securities (other than our publicly   
held equity securities) sold in a private offering shall not exceed the voting  
rights which bear the same relationship to the voting rights of the publicly    
held equity securities as the consideration paid to our Company for each        
privately offered share bears to the book value of each outstanding publicly    
held equity security. Our board of directors has no present plans to offer      
equity securities of our Company in a private offering.                         

Restrictions on Ownership 

For us to remain qualified as a REIT under the Internal Revenue Code, not more  
than 50% of the value of the outstanding shares of our capital stock may be     
owned, actually or constructively, by five or fewer individuals, as defined in  
the Internal Revenue Code, during the last half of a taxable year, and our stock
must be beneficially owned by 100 or more persons during at least 335 days of a 
taxable year of 12 months, or during a proportionate part of a shorter taxable  
year. See "Material United States Federal Income Tax Considerations." To satisfy
these ownership requirements and other requirements for qualification as a REIT,
our articles contain provisions restricting the ownership or acquisition of     
shares of our capital stock.                                                    

The ownership limit provisions provide that no stockholder may own, or be deemed
to own by virtue of the attribution provisions of the Internal Revenue Code,    
more than the ownership limit, which is equal to 9.8% of our stock. The         
attribution rules are complex and may cause stock owned directly or indirectly  
by a group of related individuals and/or entities to be                         

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deemed to be owned by one individual or entity. As a result, the acquisition of 
less than 9.8% (by value or number of shares, whichever is more restrictive) of 
each class of our outstanding stock, or the acquisition of an interest in an    
entity which owns our stock, by an individual or entity could cause that        
individual or entity to constructively own in excess of 9.8% of our outstanding 
stock, and thus subject that stock to the ownership limit.                      

Our board may, in its sole discretion, waive the ownership limit with respect to
a particular stockholder if evidence satisfactory to our board is presented that
the ownership will not then or in the future jeopardize our status as a REIT. As
a condition to the waiver, our board may require opinions of counsel            
satisfactory to it and/or an undertaking from the applicant with respect to     
preserving our REIT status. If, in the opinion of our board, any proposed       
transfer of shares of our stock may jeopardize our qualification as a REIT, our 
board has the right to refuse to permit the transfer of that stock.             

A transfer of our common stock or other event that results in a person owning   
shares in excess of the ownership limit will result in those shares of our stock
most recently acquired by that person that are in excess of the ownership limit 
being converted into "excess shares." These excess shares will then be          
automatically transferred to a trust, the beneficiary of which will be a        
qualified charitable organization that we select. The intended transferee will  
not be entitled to vote these shares and will not receive any dividends declared
on these shares. Within 20 days after the transfer of the shares to the trust,  
the trustee of the trust will be required to sell the excess shares to a person 
or entity who could own the shares without violating the ownership limit. The   
trustee, upon a sale of these shares, would then distribute to the intended     
transferee an amount equal to the lesser of the price paid by that intended     
transferee (or, in some circumstances, the market value of those shares) or the 
sale proceeds received by the trust. In addition, assuming that these excess    
shares had not yet been sold by the trustee, we would have the right, for a     
period of 120 days beginning on the date described below, to purchase all or any
portion of the excess shares from the trust at a price equal to the lesser of   
the price paid for the stock by the intended transferee (or, in some            
circumstances, the market value of those shares) and the closing market price   
for the common stock on the date we exercise our option to purchase the stock.  
This period commences on the date of the violative transfer if the intended     
transferee gives us notice of the transfer, or the date our board determines    
that a violative transfer has occurred if no notice is provided.                

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The affirmative vote of the holders of at least two-thirds of the shares of our 
voting stock is required to alter, amend, or adopt any provision inconsistent   
with or repeal the ownership limit provision. In addition to preserving our     
status as a REIT, the ownership limit may have the effect of precluding an      
acquisition of control of the REIT without the approval of our board.           

All persons who own at least a specified percentage of our stock must file an   
affidavit with us containing information regarding their ownership of stock, as 
set forth in the United States Treasury Regulations. Under current Treasury     
Regulations, the percentage will be set between 0.5% and 5%, depending on the   
number of record holders of stock. In addition, each stockholder will upon      
demand be required to disclose to us in writing that information with respect to
the direct, indirect and constructive ownership of shares as our board deems    
necessary to comply with the provisions of the Internal Revenue Code applicable 
to a REIT or to comply with the requirements of any taxing authority or         
governmental agency.                                                            

Inspection of Books and Records 

Our advisor will keep, or cause to be kept, on our behalf, full and true books  
of account on an accrual basis of accounting, in accordance with generally      
accepted accounting principles. All of such books of account, together with all 
other records of our Company, including a copy of our articles of incorporation 
and bylaws and any amendments thereto, will at all times be maintained at our   
principal office, and will be open to inspection, examination, and, for a       
reasonable charge, duplication upon reasonable notice and during normal business
hours by a stockholder or his or her agent.                                     

As a part of our books and records, we will maintain at our principal office an 
alphabetical list of names of stockholders, along with their addresses and the  
number of shares held by each stockholder. Such list will be updated at least   
quarterly and will be available for inspection at our principal office by a     
stockholder or his or her agent upon such stockholder's request. Such list also 
will be mailed to any stockholder requesting the list within 10 days of a       
request. The copy of the stockholder list shall be printed in alphabetical      
order, on white paper, and in readily readable type size that is not smaller    
than 10-point type. We may impose a reasonable charge for expenses incurred in  
reproducing such list. The list may not be sold or used for commercial purposes.

If our advisor or our directors neglect or refuse to exhibit, produce or mail a 
copy of the stockholder list as requested, our advisor and our directors will be
liable to any stockholder requesting the list for the costs, including          
attorneys' fees, incurred by that stockholder for compelling the                

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production of the stockholder list. It will be a defense that the actual purpose
and reason for requests for inspection or for a copy of the stockholder list is 
to secure such list of stockholders or other information for the purpose of     
selling such list or copies thereof, or of using them for a commercial purpose  
other than in the interest of the applicant as a stockholder relative to the    
affairs of our Company. We may require the stockholder requesting the           
stockholder list to represent that the list is not requested for a commercial   
purpose unrelated to the stockholder's interest in our Company. The remedies    
provided by our articles of incorporation to stockholders requesting copies of  
the stockholder list are in addition to, and do not in any way limit, other     
remedies available to stockholders under federal law or the law of any state.   

Restriction on "Roll-Up" Transactions 

In connection with any proposed "Roll-Up Transaction," which, in general terms, 
is any transaction involving the acquisition, merger, conversion or             
consolidation, directly or indirectly, of our Company and the issuance of       
securities of an entity (a "Roll-Up Entity") that would be created or would     
survive after the successful completion of the Roll-Up Transaction, an appraisal
of all properties will be obtained from a competent independent appraiser. In   
order to qualify as an independent appraiser for this purpose, the person or    
entity must have no material current or prior business or personal relationship 
with our advisor or our directors and must be engaged to a substantial extent in
the business of rendering opinions regarding the value of assets of the type    
held by our Company. The properties must be appraised on a consistent basis, and
the appraisal must be based on the evaluation of all relevant information and   
indicate the value of the properties as of a date immediately prior to the      
announcement of the proposed Roll-Up Transaction. The appraisal must assume an  
orderly liquidation of properties over a 12-month period. The terms of the      
engagement of such independent appraiser must clearly state that the engagement 
is for our benefit and the benefit of our stockholders. A summary of the        
independent appraisal, indicating all material assumptions underlying the       
appraisal, must be included in a report to stockholders in connection with a    
proposed Roll-Up Transaction. In connection with a proposed Roll-Up Transaction,
the person sponsoring the Roll-Up Transaction must offer to stockholders who    
vote against the proposal the choice of:                                        

(i)  accepting the securities of the Roll-Up Entity offered in the proposed     
Roll-Up Transaction; or                                                 

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(ii) one of the following:                                                      

(A) remaining stockholders of our Company and preserving their interests
  therein on the same terms and conditions as existed previously; or

    (B) receiving cash in an amount equal to the stockholder's PRO RATA share of
the appraised value of our net assets.                          

We are prohibited from participating in any proposed Roll-Up Transaction:       

(i)  which would result in the stockholders having democracy rights in the      
Roll-Up Entity that are less than those provided in our articles of     
incorporation and by-laws and described elsewhere in this section of the
prospectus, including rights with respect to the election and removal of
directors, annual reports, annual and special meetings, amendment of the
articles of incorporation, and dissolution of our Company;              

(ii) which includes provisions that would operate as a material impediment to,  
or frustration of, the accumulation of shares by any purchaser of the   
   securities of the Roll-Up Entity (except to the minimum extent necessary to
preserve the tax status of the Roll-Up Entity), or which would limit the
 ability of an investor to exercise the voting rights of its securities of
the Roll-Up Entity on the basis of the number of shares held by that    
investor;                                                               

(iii) in which investor's rights to access of records of the Roll-Up Entity will
  be less than those provided in our articles of incorporation and described
  in this section of the prospectus under the heading "--Inspection of Books
and Records," above; or                                                 

(iv) in which any of the costs of the Roll-Up Transaction would be borne by us  
if the Roll-Up Transaction is not approved by the stockholders.         

Certain Provisions of Maryland Law and of our Articles and Bylaws 

The following paragraphs summarize certain provisions of Maryland law and of our
articles and bylaws. The business combination provisions and the control share  
acquisition provisions of the MGCL, and the advance notice provisions of our    
bylaws, could have the affect of delaying, deferring or preventing a transaction
or a change in control that might involve a premium price for holders of shares 
of our common stock or otherwise be in our stockholders' best interest.         

Termination of our Company and REIT Status

Our articles provide for us to have a perpetual existence. If our shares are not
listed on a national securities exchange or on the NASDAQ National              

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Market by June 22, 2015, however, we will liquidate and dissolve if stockholders
holding a majority of our shares vote to authorize us to do so. Our articles    
further provide for the voluntary termination or dissolution of our Company by  
the affirmative vote of a majority of the shares of common stock outstanding and
entitled to vote at a meeting called for that purpose. In addition, our articles
permit the stockholders to terminate our status as a REIT under the Code only by
the affirmative vote of the holders of a majority of the shares of common stock 
outstanding and entitled to vote.                                               

Amendment of Articles and Bylaws

Our articles may be amended by the affirmative vote of a majority of the shares 
of common stock outstanding and entitled to vote except in the case of          
amendments to the provisions regarding amending our articles or reorganizing our
Company, which require a two-thirds vote. The stockholders may vote to amend our
articles, terminate or dissolve our Company or remove one or more directors     
without necessity for concurrence by our board of directors. Our bylaws may be  
amended or repealed by the affirmative vote of a majority of all shares         
outstanding and entitled to vote generally in the election of directors, voting 
as a single group without the consent of the directors.                         

Unless otherwise required by law, our board may amend or repeal our bylaws by   
the affirmative vote of a majority of the directors then in office (including a 
majority of the independent directors), provided that such amendments are not   
inconsistent with our articles. The directors may not amend the bylaws without  
the affirmative vote of a majority of the shares to the extent that such        
amendments adversely affect the rights, preferences and privileges of           
stockholders.                                                                   

Meetings of Stockholders

Under our bylaws, annual meetings of stockholders for the purpose of electing   
directors and for the transaction of such other business as may come before the 
meeting are to be held in May of each year at a date and time as determined by  
our board. Special meetings of stockholders may be called by a majority of the  
independent directors, by the Chairman or by a majority of the board of         
directors. Special meetings must be called by the Secretary upon the written    
request of the holders of not less than 10% of the shares of our common stock   
entitled to vote at a meeting. Upon receipt of such a written request, either in
person or by mail, stating the purpose or purposes of the meeting, we will      
provide all stockholders, within ten days of receipt of the written request,    
written notice, either in person or by mail, of the meeting and its purpose.    
Such meeting will be held not less than 15 nor more than 60 days after          
distribution of the                                                             

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notice, at the time and place specified in the request, or if none is specified,
at a time and place convenient to stockholders. Only matters set forth in the   
notice of the meeting may be considered and acted upon at a special meeting.    

At any meeting of stockholders, each stockholder is entitled to one vote per    
share of common stock owned of record on the applicable record date. In general,
the presence in person or by proxy of 50% of the shares of common stock then    
outstanding will constitute a quorum, and the majority vote of the shares of    
common stock present in person or by proxy will be binding on all our           
stockholders.                                                                   

Advance Notice Provisions for Stockholder Nominations and Stockholder Proposals 

Our bylaws establish an advance notice procedure for stockholders to make       
nominations of candidates for directors or bring other business before an annual
meeting of stockholders. Any stockholder nomination or proposal for action at an
upcoming stockholder meeting must be delivered to our Secretary not less than 60
days nor more than 90 days prior to the first anniversary of the preceding      
year's annual meeting and must comply with other procedural requirements        
described in our bylaws. Our bylaws contain a similar notice requirement in     
connection with nominations for directors at a special meeting of stockholders  
called for the purpose of electing one or more directors.                       

The purpose of requiring stockholders to give advance notice of nominations and 
other proposals is to afford our board the opportunity to consider the          
qualifications of the proposed nominees or the advisability of the other        
proposals and, to the extent considered necessary by our board, to inform       
stockholders and make recommendations regarding the nominations or other        
proposals. The advance notice procedures also permit a more orderly procedure   
for conducting our stockholder meetings. Although the bylaws do not give our    
board the power to disapprove timely stockholder nominations and proposals, they
may have the effect of precluding a contest for the election of directors or    
proposals for other action if the proper procedures are not followed, and of    
discouraging or deterring a third party from conducting a solicitation of       
proxies to elect its own slate of directors to our board or to approve its own  
proposal.                                                                       

The Board of Directors

Our articles provide that our board will initially consist of five directors and
thereafter the number of directors may be established by our board or by a      
majority vote of the stockholders, but the total cannot be less than            

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three or more than 15. A majority of our board of directors will be independent 
directors. See "Management--Independent Directors." Each director, other than a 
director elected to fill the unexpired term of another director, will be elected
at each annual meeting or at any special meeting of the stockholders called for 
that purpose, by a majority of the shares of common stock present in person or  
by proxy and entitled to vote. However, if there is an interested stockholder,  
the filling of the vacancy must also be approved by the affirmative vote of a   
majority of those directors who are not affiliated with the interested          
stockholder and who were in office prior to the time the stockholder became an  
interested stockholder. Independent directors will nominate replacements for    
vacancies among the independent directors. Under our articles, the term of      
office for each director will be one year, expiring at each annual meeting of   
stockholders; however, nothing in our articles prohibits a director from being  
reelected by the stockholders. The directors may not, without concurrence of a  
majority of the outstanding shares, (a) amend our articles; (b) sell all or     
substantially all of our assets other than in the ordinary course of business or
in connection with liquidation and dissolution; (c) cause the merger or other   
reorganization of our Company; or (d) dissolve or liquidate our Company, other  
than before the initial closing. The directors may establish such committees as 
they deem appropriate (provided that the majority of the members of each        
committee are independent directors).                                           

Under our articles, a director may resign or be removed with or without cause by
the affirmative vote of a majority of our capital stock outstanding and entitled
to vote.                                                                        

Business Combinations 

Pursuant to Maryland law and our articles, any merger, consolidation or sale of 
substantially all of our assets or voluntary dissolution or liquidation must be 
approved by our directors and the holders of at least a majority of the         
outstanding shares of our common stock. In addition, any such transaction       
involving an affiliate of our Company or our advisor also must be approved by a 
majority of the directors (including a majority of the independent directors)   
not otherwise interested in such transaction as fair and reasonable to our      
Company and on terms and conditions not less favorable to us than those         
available from unaffiliated third parties.                                      

In addition, under the MGCL, particular business combinations, including a      
merger, consolidation, share exchange or, in some circumstances, an asset       
transfer or issuance or reclassification of equity securities, between a        
Maryland corporation and specified insiders or any stockholder who beneficially 
owns, directly or indirectly, 10% or more of our stock, are prohibited for five 
years. Thereafter, any business combination must be recommended by our board of 
directors and approved by the affirmative vote of                               

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at least (a) 80% of the votes entitled to be cast by holders of our outstanding 
voting stock voting as a single group, and (b) two-thirds of the votes entitled 
to be cast by holders of our outstanding voting stock voting as a single group, 
other than shares held by the parties with whom the business combination is to  
be effected. These provisions of the MGCL do not apply, however, to business    
combinations that are approved or exempted by our board of directors prior to   
the time that the insider or 10% stockholder becomes an insider or 10%          
stockholder.                                                                    

Control Share Acquisition 

With certain exceptions, the MGCL provides that "Control Shares" of a Maryland  
corporation acquired in a control share acquisition have no voting rights except
to the extent approved by a vote of two-thirds of the votes entitled to be cast 
on the matter, excluding shares owned by the acquiring person or by our officers
or directors who are our employees, and may be redeemed by us. "Control Shares" 
are voting shares which, if aggregated with all other shares owned or voted by  
the acquiror, would entitle the acquiror to exercise voting power in electing   
directors within one of the following ranges of voting power: (i) one-tenth or  
more but less than one-third, (ii) one-third or more but less than a majority,  
or (iii) a majority or more of all voting power. Control shares do not include  
shares the acquiror is then entitled to vote as a result of having previously   
obtained stockholder approval. A control share acquisition means, subject to    
certain exceptions, the acquisition by any person of ownership or voting power  
of issued and outstanding control shares. A person who has made or proposes to  
make a control share acquisition, upon satisfaction of certain conditions,      
including an undertaking to pay expenses, may compel our board to call a special
meeting of stockholders to be held within 50 days of demand to consider the     
voting rights of the "Control Shares" in question. If no request for a meeting  
is made, we may present the question at any stockholders' meeting.              

Our bylaws contain a provision exempting any and all acquisitions of our capital
stock from the control shares provision of Maryland law. Nothing prevents our   
board from amending or repealing this provision in the future.                  

Anti-takeover Legislation 

Maryland law allows publicly-held Maryland corporations to elect to be governed 
by all or any part of Maryland law provisions relating to extraordinary actions 
and unsolicited takeovers. The election to be governed by one or more of these  
provisions can be made by a Maryland corporation in its articles or bylaws or by
resolution adopted by its board                                                 

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of directors so long as the corporation has at least three directors who, at the
time of electing to be subject to the provisions, are not:                      

- officers or employees of the corporation;                                     

- persons seeking to acquire control of the corporation;                        

- directors, officers, affiliates or associates of any person seeking to acquire
control; or                                                                 

- nominated or designated as directors by a person seeking to acquire control.  

Articles supplementary must be filed with the Maryland State Department of      
Assessments and Taxation if a Maryland corporation elects to be subject to any  
or all of the provisions by board resolution or bylaw amendment. Stockholder    
approval is not required for the filing of articles supplementary.              

The Maryland legislation provides that a corporation can elect to be subject to 
all or any portion of the following provisions, notwithstanding any contrary    
provisions contained in that corporation's existing charter documents:          

- CLASSIFIED BOARD: The corporation may divide its board into three classes     
which, to the extent possible, will have the same number of directors, the  
terms of which will, after their initial terms, expire at the third annual  
meeting of stockholders after the election of each class;                   

- TWO-THIRDS STOCKHOLDER VOTE TO REMOVE DIRECTORS ONLY FOR CAUSE: The           
 stockholders may remove any director only by the affirmative vote of at least
two-thirds of all votes entitled to be cast by the stockholders generally in
the election of directors, but a director on a classified board may not be  
removed without cause;                                                      

- SIZE OF BOARD FIXED BY VOTE OF BOARD: The number of directors will be fixed   
only by resolution of the board;                                            

- BOARD VACANCIES FILLED BY THE BOARD FOR THE REMAINING TERM: Vacancies that    
result from an increase in the size of the board, or the death, resignation,
or removal of a director, may be filled only by the affirmative vote of a   
majority of the remaining directors even if they do not constitute a quorum.
 Directors elected to fill vacancies will hold office for the remainder of the
 full term of the class of directors in which the vacancy occurred, as opposed
to until the next annual meeting of stockholders, and until a successor is  
elected and qualifies; and                                                  

- STOCKHOLDER CALLS OF SPECIAL MEETINGS: Special meetings of stockholders may be
called by the secretary of the corporation only upon the written request of 
stockholders entitled to cast at least a majority of all votes              

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 entitled to be cast at the meeting and only in accordance with procedures set
out in the MGCL.                                                            

We have not elected to be governed by this legislation. We can elect to be      
governed by any or all of the provisions of the Maryland legislation at any time
in the future upon approval of a majority of stockholders.                      

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

General 

The following general discussion of material United States federal income tax   
considerations relevant to investors in our common stock has been reviewed by   
our tax counsel, Goodwin Procter LLP, which has also delivered an opinion       
supporting this discussion, a copy of which is an exhibit to Pre-Effective      
Amendment No. 1 to Post-Effective Amendment No. 4 to the Registration Statement 
on Form S-11, filed on April 6, 2006. This discussion is based upon the Internal
Revenue Code of 1986, as amended (the "Code"), the Treasury Regulations         
promulgated under the Code, judicial decisions, and administrative rulings of   
the Internal Revenue Service, or the IRS, now in effect, all of which are       
subject to change or different interpretations, possibly with retroactive       
effect. This summary does not purport to be a complete analysis of all the      
potential tax considerations relating to our qualification and taxation as a    
REIT, or to the acquisition, ownership, and disposition of our common stock. In 
particular, this discussion does not address any aspect of state, local or      
non-U.S. tax law, or any aspect of United States non-income tax law.            

Congress recently passed the American Jobs Creation Act of 2004 (the "2004 Tax  
Act") and in 2003 passed the Jobs and Growth Tax Relief Reconciliation Act of   
2003 (the "2003 Tax Act") which reduces the maximum individual tax rate for     
certain dividends from 35% to 15% and reduces the maximum individual tax rate   
for capital gains from 20% to 15%. The 15% tax rate will apply to the following 
dividends paid by our Company to our U.S. Stockholders other than corporations: 
(1) capital gains distributions; (2) dividends attributable to dividends        
received by our Company from corporations that are not REITs, such as taxable   
REIT subsidiaries; and (3) dividends attributable to income that was retained by
our Company and subject to tax at regular corporate tax rates. All other        
dividends will be subject to ordinary income tax rates. Without further action  
by the U.S. Congress, the maximum individual tax rate on long-term capital gains
will return to 20% in 2009, and the maximum individual tax rate on dividends    
will increase to 35% in 2009 and 39.6% in 2011.                                 

Except as specifically discussed below with respect to non-U.S. Stockholders    
this summary applies only to U.S. Stockholders who hold our common              

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stock as a "capital asset" (within the meaning of Section 1221 of the Code). For
purposes of this summary, a U.S. Stockholder is:                                

- a citizen or individual resident (as defined in Section 7701(b) of the Code)  
of the United States;                                                       

- a corporation (including any entity treated as a corporation for United States
  federal income tax purposes) formed under the laws of the United States or any
political subdivision of the United States;                                 

- an estate the income of which is subject to United States federal income      
taxation regardless of its source; or                                       

- a trust if a United States court is able to exercise primary supervision over 
 the administration of that trust and if one or more United States persons has
  the authority to control all substantial decisions with respect to that trust.

Persons other than U.S. Stockholders, referred to below as Non-U.S.             
Stockholders, are subject to special United States federal income tax           
considerations, some of which are discussed below.                              

This discussion does not address all aspects of United States federal income    
taxation that may be relevant to a particular investor in light of that         
investor's individual circumstances. In addition, this discussion does not      
address the federal income tax considerations applicable to investors that may  
be subject to special tax rules, such as banks, insurance companies, regulated  
investment companies, REITs, dealers in securities, traders in securities that  
elect to use a mark-to-market method of accounting, persons that have a         
functional currency other than the United States dollar, persons holding our    
common stock in a tax deferred or tax advantaged account, persons who are       
partners, shareholders or beneficiaries of an entity that holds our common      
stock, persons who are former United States citizens or long-term residents     
subject to taxation as expatriates, persons who acquire our common stock as     
compensation for the performance of services, persons that are subject to the   
alternative minimum tax, persons holding our common stock as part of a hedging  
transaction, a straddle or a conversion transaction, persons having entered into
a "constructive ownership transaction" (as defined in the Code) with respect to 
our common stock, persons deemed to sell our common stock under the constructive
sale provisions of the Code, Non-U.S. Stockholders (except to the extent        
specifically described below), and tax-exempt organizations (except to the      
extent specifically described below).                                           

We have not sought, nor will we seek, any ruling from the IRS with respect to   
the statements made and the conclusions reached in the following summary.       
Accordingly, there can be no assurance that the IRS will not                    

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challenge those statements and conclusions or that a court will not sustain that
challenge.                                                                      

Prospective investors considering the purchase of our common stock should       
consult their tax advisors as to the consequences of the purchase, ownership and
disposition of our common stock, as to the application of the United States     
federal income tax laws to their particular situations, and as to any tax       
consequences arising under United States non-income tax laws, under the laws of 
any state, local, or non-U.S. taxing jurisdiction, and under any applicable tax 
treaty.                                                                         

Taxation of the Company 

General 

We will make an election to be taxed as a REIT under Sections 856 through 860 of
the Code. We believe that we have been organized in a manner so as to qualify   
for treatment as a REIT under the Code, and we intend to remain organized and to
operate in such a manner. No assurance, however, can be given that we will      
operate in a manner so as to qualify as a REIT. Qualification and treatment as a
REIT depend on our ability to meet, on a continuing basis, various tests        
relating to our distribution rates, diversity of stock ownership and other      
qualification requirements imposed on REITs, some of which are summarized below.
Given the highly complex nature of the rules governing REITs, the ongoing       
importance of factual determinations and the possibility of future changes in   
our circumstances, no assurance can be given that we have so qualified, or that 
we will so qualify, for any particular year. See "--Failure to Qualify," below. 

So long as we qualify for treatment as a REIT, we generally will not be subject 
to federal income tax on our net income that we distribute currently to our     
stockholders. This treatment substantially eliminates the "double taxation"     
(taxation at both the corporate and stockholder levels) that generally results  
from an investment in a corporation by a U.S. Stockholder. If we do not qualify 
as a REIT, we would be taxed at federal income tax rates applicable to          
corporations on all of our income, whether or not distributed to our            
stockholders. Even if we qualify as a REIT, we may be subject to some federal   
income or excise taxes:                                                         

- we will be taxed at regular corporate rates on any undistributed "real estate 
investment trust taxable income," including our undistributed net capital   
gains;                                                                      

- under some circumstances, we may be subject to the "alternative minimum tax"  
on our items of tax preference, if any;                                     

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- if we have (A) net income from the sale or other disposition of "foreclosure  
property" (generally, property that we acquire by reason of a foreclosure or
otherwise after a default on a loan secured by the property or on a lease of
the property) that is held primarily for sale to customers in the ordinary  
course of business, or (B) other nonqualifying net income from foreclosure  
property, we will be subject to tax at the highest corporate rate on that   
income;                                                                     

- if we have net income from "prohibited transactions" (which are, in general,  
some sales or other dispositions of inventory or property, other than       
foreclosure property, held primarily for sale to customers in the ordinary  
course of business), that income will be subject to a 100% tax;             

- if we should fail to satisfy the 75% gross income test or the 95% gross income
test for qualification as a REIT, both of which are discussed below, and    
nonetheless maintain our qualification as a REIT because we meet other      
 requirements, we will be subject to a tax equal to the product of the greater
of (A) the amount by which we fail the 75% gross income test, or (B) the    
 amount by which 95% of our gross income for the taxable year (excluding gross
income from prohibited transactions) exceeds the amount of our gross income 
for the taxable year that is qualifying income for purposes of applying the 
95% gross income test, multiplied by a fraction intended to reflect our     
profitability; if we should fail to distribute with respect to each calendar
year at least the sum of (A) 85% of our ordinary income (as defined in Code 
section 4981) for that year, (B) 95% of our capital gain net income (as     
  defined in Code section 4981) for that year, and (C) any undistributed taxable
 income from prior years, we would be subject to a 4% excise tax on the excess
of that required distribution over the amounts actually distributed;        

- if we acquire any asset from a C corporation (generally, a corporation subject
 to full corporate-level tax) in a transaction in which the basis of the asset
in our hands is determined by reference to the basis of the asset (or any   
other property) in the hands of the C corporation (such as our deemed       
acquisition of assets from a C corporation at the beginning of the first    
taxable year for which we elect REIT status) and we subsequently recognize  
gain on the disposition of that asset during the 10-year period (the        
"Recognition Period") beginning on the date on which we acquired the asset, 
then, unless the transferor makes certain elections, the lesser of (A) the  
fair market value of the asset as of the beginning of the Recognition Period
  over our basis in the asset as of the beginning of the Recognition Period (the
"Built-In Gain"), or (B) the amount of gain we would otherwise recognize on 
the disposition will be subject to tax at the highest regular corporate rate
(the "Built-In Gain Rule"); and                                             

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- we will be subject to a 100% tax equal to the amount, if any, of our          
redetermined rents (generally, the amount of "rents from real property" we  
  receive from our tenants that would be treated under the Code as income of our
  taxable REIT subsidiaries to clearly reflect the value of services they render
  to those tenants), redetermined deductions (generally, the amount by which the
deductions of our taxable REIT subsidiaries are reduced under the Code to   
appropriately reflect the sharing of deductible expenses among us and our   
taxable REIT subsidiaries), and excess interest (generally, the amount of   
interest deductions claimed by our taxable REIT subsidiaries in respect of  
  interest payments they make to us to the extent those interest payments are in
excess of a commercially reasonable rate).                                  

- because we acquired properties prior to the first day of the first taxable    
year for which we qualified as a REIT (which is anticipated to be January 1,
2005, or the "REIT Commencement Date"), if we recognize gain on the         
disposition of any of these assets during the 10-year Recognition Period    
beginning on the REIT Commencement Date, then the lesser of (A) the fair    
market value of the asset as of the REIT Commencement Date over our basis in
  the asset as of the REIT Commencement Date, or (B) the amount of gain we would
otherwise recognize on the disposition will be subject to tax at the highest
regular corporate rate under the Built-In Gain Rule.                        

General Requirements for Qualification

The Code defines a REIT as a corporation, trust or association that maintains in
effect an election to be treated as a REIT and--                                

(i)  is managed by one or more trustees or directors;                           

(ii) the beneficial ownership of which is evidenced by transferable shares, or  
by transferable certificates of beneficial interest;                    

(iii) would be taxable as a domestic corporation but for Sections 856 through   
860 of the Code;                                                        

(iv) is neither a financial institution nor an insurance company subject to     
certain provisions of the Code;                                         

(v) has the calendar year as its taxable year;                                  

(vi) the beneficial ownership of which is held by 100 or more persons;          

(vii) at all times during the last half of each taxable year not more than 50%  
(by value) of the outstanding stock of which is owned, directly or      
    indirectly, by five or fewer individuals (which term includes some entities,
  such as qualified pension trusts described in Section 401(a) of the Code),
determined by applying various "look-through" rules                     

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    (we refer to this test, discussed in more detail below, as the Five or Fewer
Requirement); and                                                       

(viii) that meets various other tests, described below, regarding the nature of 
its income and assets and the amounts of its distributions.             

The Code provides that each of the conditions described in (i) through (v), must
be met during the entire taxable year and that the condition described in       
(vi) must be met during at least 335 days of a taxable year of 12 months, or    
during a proportionate part of a taxable year of less than 12 months. The       
conditions described in (vi) and (vii) do not apply during the first taxable    
year for which an election is made to be taxed as a REIT (which in our case is  
anticipated to be the taxable year ending December 31, 2005).                   

The Five or Fewer Requirement referred to above is modified in the case of some 
pension trusts, referred to below as qualified trusts, that own shares of a REIT
and are described in Section 401(a) of the Code and exempt from federal income  
taxation under Section 501(a) of the Code. Shares in a REIT held by a qualified 
trust are treated as held directly by the qualified trust's beneficiaries in    
proportion to their actuarial interests in the qualified trust, rather than by  
the qualified trust itself. To qualify as a REIT, we cannot have at the end of  
any taxable year any undistributed earnings and profits that are attributable to
a non-REIT taxable year. We do not believe that we have any non-REIT earnings   
and profits and therefore we believe that we satisfy this requirement.          

Qualified REIT Subsidiaries 

We may in the future have one or more qualified REIT subsidiaries. A corporation
that is a qualified REIT subsidiary is not treated as a separate corporation for
federal income tax purposes, and all assets, liabilities and items of income,   
deduction and credit of a qualified REIT subsidiary are treated as assets,      
liabilities and items of the REIT. In applying the REIT qualification           
requirements, qualified REIT subsidiaries are ignored, and all assets,          
liabilities and items of income, deduction and credit of each qualified REIT    
subsidiary are treated as assets, liabilities and items of income, deduction and
credit of the REIT. Qualified REIT subsidiaries are therefore not subject to    
federal corporate income taxation, although they may be subject to state and    
local taxation. We currently have no qualified REIT subsidiaries.               

Taxable REIT Subsidiaries 

We may in the future have one or more taxable REIT subsidiaries. A taxable REIT 
subsidiary is any corporation in which we directly or indirectly own stock,     
provided that we and that corporation make a joint election to                  

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treat it as a taxable REIT subsidiary. In addition, if a taxable REIT subsidiary
holds, directly or indirectly, more than 35% of the securities of any other     
corporation (by vote or by value), then that other corporation is also treated  
as a taxable REIT subsidiary. A taxable REIT subsidiary is subject to federal   
income tax at regular corporate rates, and may also be subject to state and     
local taxation. We may hold more than 10% of the stock of a taxable REIT        
subsidiary without jeopardizing our qualification as a REIT. However, as noted  
below, the securities of taxable REIT subsidiaries may not represent more than  
20% of the total value of our assets. We currently have no taxable REIT         
subsidiaries.                                                                   

Partnerships and Disregarded Entities 

We currently hold our properties indirectly through entities (i) that are       
organized as limited partnerships or limited liability companies under state law
and are classified as partnerships for federal income tax purposes, each of     
which is referred to below as a Partnership Entity, or (ii) that are organized  
as limited partnerships or limited liability companies under state law and are  
disregarded as entities separate from us for federal income tax purposes, each  
of which is referred to below as a Disregarded Entity. All assets, liabilities  
and items of income, deduction and credit of a Disregarded Entity are treated as
our assets, liabilities and items of income, deduction and credit in applying   
the income and asset tests discussed below and for all other federal income tax 
purposes. In the case of a REIT that is a partner in a partnership, the REIT is 
deemed to own its proportionate share of the assets of the partnership and is   
deemed to receive the income of the partnership attributable to that share. In  
addition, the partnership's assets and gross income will retain the same        
character in the hands of the REIT. Accordingly, our proportionate shares of the
assets and items of income of a Partnership Entity are treated as our assets and
items of income in applying the income and asset tests discussed below. We will 
not hold any properties through a Partnership Entity unless we have been advised
by Goodwin Procter LLP, which, subsequent to August 16, 2005, serves as         
securities and tax counsel solely for this offering, that such entity will be   
treated as a partnership for federal income tax purposes and that the           
allocations of income and loss in such Partnership Entity's partnership         
agreement will be respected for federal income tax purposes. Similarly, we will 
not hold any property through a Disregarded Entity unless we have been advised  
by our counsel that such entity will be disregarded for federal income tax      
purposes.                                                                       

Income Tests

In order to qualify as a REIT, we must satisfy two gross income requirements on 
an annual basis. First, at least 75% of our gross income (excluding gross income
from "prohibited transactions," described above) for each                       

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taxable year must be derived directly or indirectly from investments relating to
real property or interests in mortgages on real property (including "rents from 
real property" (described below), interest on obligations secured by mortgages  
on real property, and distributions on, and gain with respect to the disposition
of, shares of other REITs) or from various types of temporary investments.      
Second, at least 95% of our gross income (excluding gross income from           
"prohibited transactions," described above) for each taxable year must be       
derived from the same items which qualify under the 75% gross income test, and  
from dividends, interest and gain from the sale or disposition of stock or      
securities, or from any combination of these items. We intend that the income   
generated by our investments will be of a type which satisfies both the 75% and 
the 95% gross income tests. If we were to fail either of these tests in a       
taxable year, we will not be disqualified as a REIT if the failure was due to   
reasonable cause and not willful neglect and we file certain additional         
information with the Treasury in accordance with Regulations. It is not         
possible, however, to state whether in all circumstances we would be entitled to
the benefit of these relief provisions. As discussed above, even if these relief
provisions were to apply, a tax would be imposed on certain excess net income.  

Rents received by a REIT will qualify as "rents from real property" in          
satisfying the gross income tests described above only if several conditions are
met:                                                                            

- First, the amount of rent generally must not be based in whole or in part on  
the income or profits of any person. A REIT's "rents from real property" may
  include amounts based on a fixed percentage or percentages of a tenant's gross
receipts or sales.                                                          

- Second, rents received from a tenant will not qualify as "rents from real     
  property" in satisfying the gross income tests if the REIT owns 10% or more of
the tenant, whether directly or after application of various attribution    
 rules. This rule does not apply to amounts paid to a REIT by its taxable REIT
subsidiary if some conditions are met. While we intend not to lease property
  to any party if rents from that property would not qualify as "rents from real
property," application of the 10% ownership rule is dependent upon complex  
attribution rules that may apply by reason of circumstances beyond our      
control. For example, ownership (directly or by attribution) by an          
unaffiliated third-party of more than 10% of our common stock and more than 
10% of the stock of one or more of our lessees would result in that lessee's
rents not qualifying as "rents from real property." Although our articles   
contain restrictions that are intended to help us maintain our status as a  
REIT, there can be no                                                       

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 assurance that we will be able to monitor and enforce those restrictions, nor
will our stockholders necessarily be aware of ownership attributable to them
under the Code's attribution rules.                                         

- Third, if rent attributable to personal property leased in connection with the
lease of real property is greater than 15% of the total rent received under 
the lease, then the portion of rent attributable to that personal property  
will not qualify as "rents from real property." Subject to meeting this     
threshold test, rent attributable to personal property leased in connection 
 with the lease of real property will be treated as "rents from real property"
for this purpose.                                                           

- Finally, charges for services customarily furnished or rendered in connection 
 with the rental of real property may be treated as "rents from real property"
for this purpose. However, in order for rents received with respect to a    
 property and these charges to qualify as "rents from real property," the REIT
generally must not operate or manage the property or furnish or render      
services to tenants, except through a taxable REIT subsidiary or through an 
independent contractor who is adequately compensated and from whom the REIT 
  derives no income. The requirement that services be provided through a taxable
 REIT subsidiary or through an independent contractor, however, does not apply
  to services provided by the REIT that are "usually or customarily rendered" in
connection with the rental of space for occupancy only and are not otherwise
considered to be rendered to the occupant. If the value of the non-customary
 service income with respect to a property (valued at no less than 150% of the
direct costs of performing such services) is 1% or less of the total income 
derived from the property, then all rental income except the non-customary  
service income will qualify as "rents from real property."                  

We do not anticipate charging rent that is based in whole or in part on the     
income or profits of any person. We do not anticipate receiving a material      
amount of rents from any tenants that are related parties as described above. We
do not anticipate receiving rent attributable to personal property leased in    
connection with real property.                                                  

We do not anticipate providing services with respect to our properties. Rather, 
we will employ adequately compensated independent contractors for that purpose. 

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Asset Tests 

To qualify as a REIT, we must also satisfy three tests relating to the nature of
our assets at the close of each quarter of each taxable year:                   

- at least 75% of the value of our total assets must be represented by "real    
estate assets" as defined in the Code, cash, cash items and government      
 securities. For these purposes, a REIT's "real estate assets" include (A) its
 allocable share of real estate assets held by partnerships in which it has an
interest, (B) shares in other REITs, and (C) stock or debt instruments      
purchased with the proceeds of a stock offering or long-term (i.e., at least
five years) debt offering of the REIT and held for not more than one year   
following the receipt of those proceeds;                                    

- not more than 20% of the value of our total assets may be represented by      
securities of taxable REIT subsidiaries; and                                

- of the investments that do not qualify for purposes of the first test         
  described above, the value of any one issuer's securities may not exceed 5% of
  the value of our total assets, and we may not own more than 10% (by vote or by
value) of any one issuer's outstanding securities. Equity interests in a    
Partnership Entity or in a Disregarded Entity, shares of a qualified REIT   
subsidiary and shares of a taxable REIT subsidiary held by a REIT are       
disregarded for purposes of this test.                                      

Instead, as discussed above, our proportionate share of the assets of each      
Partnership Entity and all of the assets of each Disregarded Entity are treated 
as our assets in applying these asset tests.                                    

Securities, for the purposes of these asset tests, may include debt we hold.    
However, debt we hold in an issuer will not be taken into account for purposes  
of the 10% value test if the debt securities are straight debt (as defined in   
the Code's REIT provisions) and either (i) the issuer is an individual,         
(ii) the only securities of the issuer that we hold are straight debt, or       
(iii) if the issuer is a partnership, we hold at least a 20% profits interest in
the partnership.                                                                

After initially meeting the asset tests at the close of any quarter, we will not
lose our status as a REIT for failure to satisfy these asset tests at the end of
a later quarter solely by reason of changes in asset values. If a failure to    
satisfy these asset tests results from an acquisition of securities or other    
property during a quarter, the failure may be cured by a disposition of         
sufficient nonqualifying assets within 30 days following the close of that      
quarter. Under the provisions enacted by the 2004 Tax Act, a REIT's failure to  
satisfy any of the asset test requirements may not result in a loss of its REIT 
status if certain specified requirements are satisfied. We have maintained, and 
we intend to continue to maintain, adequate records of the value of our assets  
to permit compliance with the asset tests and                                   

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we plan to take on a timely basis any actions that may be required to cure any  
noncompliance. However, there can be no assurance that we will succeed in taking
any such necessary actions.                                                     

Annual Distribution Requirements

In order to qualify as a REIT, we are required to distribute dividends (other   
than capital gain dividends) to our stockholders in an amount at least equal to 
(i) the sum of (A) 90% of our "real estate investment trust taxable income"     
(computed without regard to the dividends paid deduction and by excluding the   
amount of the REIT's net capital gain) and (B) 90% of our net income (after     
tax), if any, from foreclosure property, minus (ii) various items of noncash    
income. In addition, if we dispose of any asset subject to the Built-In Gain    
Rule during its Recognition Period (see "--Taxation of the Company--General,"   
above), we are required to distribute an amount equal to at least 90% of the    
Built-In Gain (after payment of a corporate level tax), if any, recognized on   
the disposition. These distributions must be paid during the taxable year to    
which they relate (or during the following taxable year, if the distributions   
are declared before we timely file our tax return for the preceding year and are
paid on or before the first regular dividend payment after the declaration). In 
addition, dividends declared in October, November, or December to stockholders  
of record on a specified date during those months and paid during the following 
January will be treated as having been both paid and received on December 31 of 
the year the dividend is declared. As noted above, if we do not distribute all  
of our net capital gain and all of our "real estate investment trust taxable    
income," as adjusted, we will be subject to tax on the undistributed amount at  
regular corporate tax rates. Furthermore, as noted above, if we fail to         
distribute during each calendar year at least the sum of (i) 85% of our ordinary
income (as defined in Code Section 4981) for such year, (ii) 95% of our capital 
gain net income (as defined in Code Section 4981) for such year, and (iii) any  
undistributed taxable income from prior periods, we will be subject to a        
nondeductible 4% excise tax on the excess of that required distribution over the
amounts actually distributed.                                                   

We may elect to retain rather than distribute all or a portion of our net       
capital gains and pay the tax on the gains. In that case, we may elect to have  
our stockholders include their proportionate share of the undistributed net     
capital gains in income as long-term capital gains and receive a credit for     
their share of the tax paid by us. For purposes of the 4% excise tax described  
above, any retained amounts would be treated as having been distributed. See    
also "--Taxation of Taxable U.S. Stockholders--General" below.                  

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We intend to make timely distributions sufficient to satisfy the annual         
distribution requirements for qualification as a REIT described above. We expect
that our "real estate investment trust taxable income" will be less than our    
cash flow due to the allowance of depreciation and other noncash charges in the 
computation of our "real estate investment trust taxable income."               

Under some circumstances, we may be able to rectify a failure to meet the       
distribution requirements for a year by paying "deficiency dividends" to        
stockholders in a later year that may be included in our deduction for dividends
paid for the earlier year. Thus, we may be able to avoid being taxed on amounts 
distributed as deficiency dividends. However, we would be required to pay to the
IRS interest based upon the amount of any deduction taken for deficiency        
dividends.                                                                      

Failure to Qualify

If we fail to qualify for taxation as a REIT in any taxable year and relevant   
relief provisions do not apply, we will be subject to tax (including any        
applicable alternative minimum tax) on our taxable income at regular corporate  
rates. Distributions to stockholders in any year in which we fail to qualify as 
a REIT will not be deductible by us, nor will we be required to make them. Under
those circumstances, to the extent of current and accumulated earnings and      
profits, all distributions to our stockholders will be taxable to them as       
dividend income and, subject to some limitations imposed by the Code, corporate 
distributees may be eligible for the "dividends received deduction." Our failure
to qualify as a REIT could substantially reduce the cash available for          
distributions to stockholders. Unless entitled to relief under specific         
statutory provisions, whose availability would depend on the circumstances of   
our disqualification, we also would be disqualified from electing taxation as a 
REIT for the four taxable years following the year during which we became       
disqualified.                                                                   

Taxation of Taxable U.S. Stockholders 

General 

In 2003, Congress passed the Jobs and Growth Tax Relief Reconciliation Act of   
2003 (the "2003 Tax Act") which reduces the maximum individual tax rate for     
certain dividends from 35% to 15% and reduces the maximum individual tax rate   
for capital gains from 20% to 15%. The 15% tax rate will apply to the following 
dividends paid by our Company to our U.S. Stockholders other than corporations: 
(1) capital gains distributions; (2) dividends attributable to dividends        
received by our Company from corporations that are not REITs, such as taxable   
REIT subsidiaries; and (3) dividends attributable to income that was retained by
our Company                                                                     

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and subject to tax at regular corporate tax rates. All other dividends will be  
subject to ordinary income tax rates.                                           

As long as we qualify as a REIT, distributions made to our taxable U.S.         
Stockholders out of current or accumulated earnings and profits (and not        
designated as capital gain dividends or otherwise eligible for the maximum tax  
rate of 15% described above), or otherwise treated by us as a dividend, will    
constitute dividends taxable at ordinary income tax rates. No dividends received
deduction will be allowed with respect to our dividend distributions.           

Distributions that we designate as capital gain dividends will be taxed as      
long-term gains from the sale or exchange of a capital asset (to the extent they
do not exceed our actual net capital gain for the taxable year) without regard  
to the period for which the stockholder has held its stock. In the event we     
designate any portion of a dividend as a capital gain dividend, a stockholder's 
share of that capital gain dividend will be an amount which bears the same ratio
to the total amount of dividends paid to that stockholder for the taxable year  
as the total amount of capital gain dividends bears to the total amount of all  
dividends paid on all classes of stock for that taxable year. However, corporate
stockholders may be required to treat up to 20% of some capital gain dividends  
as ordinary income. We may elect to retain and pay income tax on any net        
long-term capital gain, in which case our U.S. Stockholders would include in    
their income as long-term capital gain their proportionate share of that        
undistributed net long-term capital gain. A U.S. Stockholder would also receive 
a refundable tax credit for its proportionate share of the tax paid by us on any
retained net long-term capital gains and an increase in its basis in our stock  
in an amount equal to the difference between the undistributed net long-term    
capital gains and the amount of tax paid by us. See "Capital Gains and Losses," 
below. If we should elect to retain any net long-term capital gains in this     
fashion, we will notify each U.S. Stockholder of the relevant tax information   
within 60 days after the close of the applicable taxable year.                  

Distributions in excess of our current and accumulated earnings and profits and 
not treated by us as a dividend will not be taxable to a stockholder to the     
extent that they do not exceed the adjusted basis of that stockholder's stock,  
but rather will reduce the adjusted basis of that stock. To the extent that     
those distributions exceed the adjusted basis of a stockholder's stock, they    
will be treated as a capital gain realized from the taxable disposition of those
shares and will be included in income as short-term or long-term capital gain,  
depending on the length of time those shares have been held. In addition, as    
previously noted, any dividend declared by us in October, November or December  
of any year and payable to a stockholder of record on a specific date in any of 
those                                                                           

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months will be treated as both paid by us and received by the stockholder on    
December 31 of that year, provided that the dividend is actually paid by us     
during January of the following calendar year.                                  

U.S. Stockholders may not include any of our net operating losses or capital    
losses in their individual income tax returns. Instead, we will carry those     
losses forward for potential offset against future income, subject to some      
limitations. Our distributions and gain realized by stockholders from the sale  
or exchange of shares of our common stock will not be treated as passive        
activity income, and, as a result, U.S. Stockholders that are individuals,      
estates, trusts, personal service corporations, or closely held C corporations  
generally will not be able to apply any "passive losses" against that income and
gain.                                                                           

U.S. Stockholders other than corporations who borrow funds to finance their     
acquisition of our common stock may be limited in the amount of deductions      
allowed for the interest paid on the indebtedness so incurred. Interest paid or 
accrued on indebtedness incurred or continued to purchase or carry property held
for investment is generally deductible only to the extent of the investor's net 
investment income. Our ordinary dividend distributions generally will be treated
as investment income for this purpose. Capital gain dividends and capital gains 
realized by a stockholder from the disposition of shares of our common stock    
(including distributions treated as such), however, will be treated as          
investment income only if the stockholder so elects, in which case the capital  
gains will be taxed at ordinary income rates. Distributions treated as a        
nontaxable return of the U.S. Stockholder's investment in our common stock and  
that reduce the U.S. Stockholder's basis in our common stock will not enter into
the computation of net investment income. We will notify stockholders after the 
close of our taxable year as to the portions of distributions attributable to   
that year that constitute ordinary dividend income, return of capital, capital  
gain and dividends subject to the maximum 15% tax rate.                         

Capital Gains and Losses

In general, a U.S. Stockholder will recognize capital gain or loss on the       
taxable sale or exchange of shares of our common stock in an amount equal to the
difference between (i) the amount of cash and the fair market value of any      
property received in that sale or exchange, and (ii) the stockholder's adjusted 
basis in the shares of our common stock sold or exchanged. That gain or loss    
generally will constitute short-term capital gain or loss if the stockholder has
not held those shares for more than one year and long-term capital gain or loss 
if the stockholder has held those shares for more than one year. In general,    
loss realized upon a sale or exchange of shares of our common stock by a        
stockholder who has held the common stock for six months or less (after applying
certain                                                                         

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holding period rules) will be treated as a long-term capital loss to the extent 
of distributions received from us required to be treated by that stockholder as 
long-term capital gain and allocations to the stockholder of our undistributed  
long-term capital gains. Any loss realized upon a disposition of shares may also
be disallowed under the rules relating to wash sales.                           

The 2003 Tax Act reduced the maximum marginal ordinary income tax rate          
applicable to individuals, estates and trusts to 35% commencing with calendar   
year 2003. The maximum tax rate on net capital gains applicable to individuals, 
trusts and estates from the sale or exchange of capital assets held for more    
than one year has been reduced to 15% by the 2003 Tax Act. The maximum rate     
applicable to individuals, estates and trusts for net capital gains attributable
to the sale of depreciable real property held for more than one year is 25% to  
the extent of the deductions for depreciation (other than certain depreciation  
recapture taxable as ordinary income) with respect to the property. In addition,
the characterization of gross income as either capital gain or ordinary income  
may affect the deductibility of capital losses. Capital losses not offset by    
capital gains may be deducted against a noncorporate taxpayer's ordinary income 
only up to a maximum annual amount of $3,000. Unused capital losses may be      
carried forward. All net capital gain of a corporate taxpayer is subject to tax 
at regular corporate rates. A corporate taxpayer can deduct capital losses only 
to the extent of capital gains; unused capital losses may be carried back three 
years and forward five years.                                                   

IRS Notice 97-64 provides temporary guidance with respect to the taxation of    
distributions by REITs that are designated as capital gain dividends.           

According to Notice 97-64, forthcoming temporary Treasury Regulations will      
provide that capital gains allocated to a stockholder by us may be designated as
a 15% rate gain distribution or a 25% rate gain distribution. Unless we         
specifically designate otherwise, a distribution designated as a capital gain   
dividend is presumed to be a 15% rate gain distribution. If we elect to retain  
any net long-term capital gain, as discussed above, the undistributed net       
long-term capital gains are considered to be designated as capital gain         
dividends for purposes of Notice 97-64. Furthermore, Notice 97-64 provides that 
our designations of capital gain dividends will only be effective to the extent 
that the distributions with respect to our different classes of stock are       
composed proportionately of ordinary dividends and capital gain dividends.      

Information Reporting and Backup Withholding

A U.S. Stockholder may be subject to "backup withholding" with respect to       
certain "reportable payments," including dividend payments and, under           

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certain circumstances, proceeds from the sale or other disposition of our common
stock. The backup withholding rate has been reduced to 28%. Backup withholding  
generally will not apply, however, to a U.S. Stockholder who furnishes a correct
taxpayer identification number or who is otherwise exempt from backup           
withholding, such as a corporation. Generally, a U.S. Stockholder will provide  
this information on Form W-9. In addition, we may be required to withhold a     
portion of capital gain distributions made to any U.S. Stockholders who fail to 
certify their non-foreign status to us. See "--Taxation of Non-U.S.             
Stockholders," below. Any amounts withheld under the foregoing rules will be    
creditable against the U.S. Stockholder's federal income tax liability provided 
that the proper information is timely furnished to the IRS. We will report to   
U.S. Stockholders and to the IRS the amount of any "reportable payments" we make
each calendar year and the amount of tax we withhold, if any, with respect to   
such payments.                                                                  

Taxation of Tax-Exempt U.S. Stockholders

U.S. Stockholders otherwise exempt from United States federal income taxation   
are nevertheless taxable on their unrelated business taxable income, or UBTI to 
the extent that UBTI from all sources exceeds $1,000 in any taxable year.       
Dividends (including REIT distributions treated as dividends) and gains realized
from the sale or disposition of stock (other than stock held as inventory, stock
held primarily for sale to customers in the ordinary course of business, or     
stock otherwise used in an unrelated trade or business) are generally not       
treated as UBTI. However, dividends and gains that would otherwise be exempt    
will, with limited exceptions, be included in UBTI to the extent that the       
property generating that income is subject to "acquisition indebtedness" (i.e., 
indebtedness that would not have been incurred but for the acquisition or       
improvement of the property). Thus, a portion of the dividends received and     
gains realized by a tax-exempt investor with respect to our common stock may be 
treated as UBTI if the tax-exempt investor incurs indebtedness to purchase or   
carry our shares or if the tax-exempt investor holds the shares for sale to     
customers or as inventory, or otherwise uses the shares in an unrelated trade or
business.                                                                       

Qualified trusts that hold more than 10% (by value) of the shares of certain    
REITs may be required to treat a certain percentage of such REIT's distributions
as UBTI. This requirement will apply only if (i) treating qualified trusts      
holding REIT shares as individuals would result in a determination that the REIT
is "closely held" within the meaning of Section 856(h)(l) of the Code and       
(ii) the REIT is "predominantly held" by qualified trusts. A REIT is            
predominantly held if either (i) a single qualified trust holds more than 25% by
value of the REIT interests or (ii) one or                                      

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more qualified trusts, each owning more than 10% by value of the REIT interests,
hold in the aggregate more than 50% of the REIT interests. The percentage of any
REIT dividend treated as UBTI is equal to the ratio of (a) the UBTI earned by   
the REIT (treating the REIT as if it were a qualified trust and therefore       
subject to tax on UBTI) to (b) the total gross income (less certain associated  
expenses) of the REIT. A DE MINIMIS exception applies where the ratio set forth 
in the preceding sentence is less than 5% for any year. For these purposes, a   
qualified trust is any trust described in Section 401(a) of the Code and exempt 
from tax under Section 501(a) of the Code. The restrictions on ownership of     
shares in our articles of incorporation will prevent application of the         
provisions treating a portion of REIT distributions as UBTI to tax-exempt       
entities purchasing our shares, absent a waiver of the restrictions by our board
of directors. See "Description of capital Stock--Restrictions on Ownership."    

The tax discussion of distributions to qualified retirement plans, IRAs, Keogh  
plans and other tax-exempt entities is beyond the scope of this discussion, and 
such entities should consult their own tax advisors regarding such questions.   

Taxation of Non-U.S. Stockholders General 

The rules governing the United States federal income taxation of the ownership  
and disposition of our common stock by Non-U.S. Stockholders are complex and    
this discussion does not purport to provide more than a summary of those rules. 
PROSPECTIVE NON-U.S. STOCKHOLDERS SHOULD CONSULT WITH THEIR OWN TAX ADVISORS TO 
DETERMINE THE IMPACT OF UNITED STATES FEDERAL, STATE, AND LOCAL INCOME TAX LAWS 
ON AN INVESTMENT IN SHARES OF OUR COMMON STOCK, INCLUDING ANY REPORTING         
REQUIREMENTS, AS WELL AS THE TAX TREATMENT OF SUCH AN INVESTMENT UNDER THE LAWS 
OF NON-U.S. JURISDICTIONS.                                                      

In general, Non-U.S. Stockholders will be subject to regular United States      
federal income taxation with respect to their investment in shares of our common
stock in the same manner as a U.S. Stockholder if the investment is "effectively
connected" with the conduct by such Non-U.S. Stockholder of a trade or business 
in the United States. A Non-U.S. Stockholder that is a corporation and that     
receives income with respect to its investment in shares of our common stock    
that is (or is treated as) "effectively connected" with the conduct of a trade  
or business in the United States may also be subject to the "branch profits tax"
imposed under the Code, which is payable in addition to the regular federal     
corporate income tax. The branch profits tax is imposed at a rate of 30%,       
subject to reduction in some cases by applicable income tax treaties. The       
following discussion addresses only the federal income taxation of Non-U.S.     
Stockholders                                                                    

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whose investment in shares of our common stock is not "effectively connected"   
with the conduct of a trade or business in the United States. Prospective       
investors whose investment in shares of our common stock may be "effectively    
connected" with the conduct of a United States trade or business should consult 
their own tax advisors as to the tax consequences of that investment.           

Distributions that are not attributable to gain from sales or exchanges of      
United States real property interests and that are not designated by us as      
capital gains dividends will, to the extent that they are made out of our       
current or accumulated earnings and profits or are otherwise treated as         
dividends, ordinarily be subject to a withholding tax equal to 30% of the gross 
amount of the distribution, unless an applicable tax treaty reduces that tax. A 
Non-U.S. Stockholder who wishes to claim the benefit of an applicable treaty    
rate will be required to satisfy certain certification and other requirements; a
Non-U.S. Stockholder ordinarily will provide that certification on Form W-8BEN. 
Distributions that we make in excess of our current and accumulated earnings and
profits and that are not otherwise treated as dividends will not be taxable to a
Non-U.S. Stockholder to the extent they do not exceed the adjusted basis of the 
Non-U.S. Stockholder's shares, but rather will reduce the adjusted basis of the 
shares (but not below zero). To the extent that the distributions exceed the    
adjusted basis of a Non-U.S. Stockholder's shares, they will give rise to tax   
liability if such Non-U.S. Stockholder would otherwise be subject to tax on any 
gain from the sale or disposition of shares, as described below.                

A distribution in excess of our current and accumulated earnings and profits may
be subject to withholding at the 30% rate (or at a lower rate prescribed by an  
applicable treaty) if at the time of the distribution it cannot be determined   
whether the distribution will be in an amount in excess of our current and      
accumulated earnings and profits. If it is subsequently determined that the     
distribution is, in fact, in excess of our current and accumulated earnings and 
profits and the distribution is not otherwise treated as a dividend, the        
Non-U.S. Stockholder may seek a refund from the IRS if the amount withheld      
exceeded the Non-U.S. Stockholder's federal income tax liability, if any, with  
respect to the distribution.                                                    

For any year in which we qualify as a REIT, distributions that are attributable 
to gain from sales or exchanges of United States real property interests will be
taxed to a Non-U.S. Stockholder as if the gain were effectively connected with  
the Non-U.S. Stockholder's conduct of a United States trade or business.        
Non-U.S. Stockholders would thus be taxed at the normal capital gain rates      
applicable to domestic stockholders, without regard as to whether such          
distributions are designated by us as capital gain dividends. Also, these       
distributions may be subject to a branch profits tax at a rate of up to 30% in  
the hands of a corporate Non-U.S. Stockholder. We                               

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are required to withhold 35% of any distribution to a Non-U.S. Stockholder that 
could be designated by us as a capital gain dividend. In addition, for purposes 
of this withholding rule, if we designate prior distributions as capital gain   
dividends, then subsequent distributions, up to the amount of the prior         
distributions, will be treated as capital gain dividends. The amount of any tax 
so withheld is creditable against the Non-U.S. Stockholder's federal income tax 
liability.                                                                      

Gain recognized by a Non-U.S. Stockholder upon a sale of our shares generally   
will not be subject to United States federal income taxation so long as, at all 
times during a specified testing period, less than 50% of the value of our stock
is held directly or indirectly by Non-U.S. Stockholders. We believe that we will
meet this test following the completion of the offering and, therefore, that    
gain from the sale of our common stock by a Non-U.S. Stockholder will not be    
subject to taxation under these rules. Even if we do meet this test, gain from  
the sale or exchange of our shares of stock nonetheless will be subject to a 30%
tax if the Non-U.S. Stockholder is a nonresident alien individual who is present
in the United States for 183 days or more during the taxable year and has a "tax
home" in the United States.                                                     

If we do not meet the ownership test described in the preceding paragraph,      
whether gain arising from the sale or exchange by a Non-U.S. Stockholder of     
shares of our common stock would be subject to federal income taxation will     
depend on whether our shares are regularly traded (as defined in applicable     
Treasury Regulations) on an established securities market and on the size of the
selling Non-U.S. Stockholder's interest in us. If the gain on the sale of our   
common stock were to be subject to federal income taxation, the Non-U.S.        
Stockholder would be subject to the same treatment as a domestic stockholder    
with respect to the gain (subject to the possible application of the branch     
profits tax in the case of a corporate Non-U.S. Stockholder), and the purchaser 
of the common stock would be required to withhold and remit to the IRS 10% of   
the purchase price.                                                             

Information Reporting and Backup Withholding

Non-U.S. Stockholders are generally exempt from information reporting and backup
withholding, but may be required to provide a properly completed Form W-8BEN or 
otherwise comply with the applicable certification and identification procedures
in order to prove their exemption. Any amount paid as backup withholding will be
creditable against the Non-U.S. Stockholder's federal income tax liability.     

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Other Tax Considerations
State, Local and Non-U.S. Taxes 

We and our stockholders may be subject to taxation in various state, local or   
non-U.S. jurisdictions, including those in which we or they transact business or
reside. State, local and non-U.S. taxation may not conform to the federal income
tax consequences discussed above. CONSEQUENTLY, PROSPECTIVE STOCKHOLDERS SHOULD 
CONSULT WITH THEIR OWN TAX ADVISORS REGARDING THE EFFECT OF STATE, LOCAL AND    
NON-U.S. TAX LAWS ON ANY INVESTMENT IN OUR COMMON STOCK.                        

ERISA Considerations

The following is a summary of certain considerations associated with an         
investment in us by a pension, profit sharing or other employee benefit plan    
subject to Title I of ERISA or Section 4975 of the Code. THE FOLLOWING IS MERELY
A SUMMARY, HOWEVER, AND SHOULD NOT BE CONSTRUED AS LEGAL ADVICE OR AS COMPLETE  
IN ALL RELEVANT RESPECTS. ALL INVESTORS ARE URGED TO CONSULT THEIR LEGAL        
ADVISORS BEFORE INVESTING ASSETS OF AN EMPLOYEE PLAN IN OUR COMPANY AND TO MAKE 
THEIR OWN INDEPENDENT DECISIONS.                                                

Plan Considerations 

A fiduciary considering investing assets of an employee plan in us should       
consult its legal advisor about ERISA, fiduciary and other legal considerations 
before making such an investment. Specifically, before investing in us, any     
fiduciary should, after considering the employee plan's particular              
circumstances, determine whether the investment is appropriate under the        
fiduciary standards of ERISA or other applicable law including standards with   
respect to prudence, diversification and delegation of control and the          
prohibited transaction provisions of ERISA and the Code. See "An Investment in  
Our Common Stock May Not be Suitable for Every Employee Benefit Plan." In making
those determinations, you should take into account, among the other factors     
described in this prospectus that, as described below, we do not expect that our
assets will constitute the "plan assets" of any investing employee plan, so that
neither we nor any of our principals, agents, employees, or affiliates will be a
fiduciary as to any investing employee plan.                                    

ERISA and the Code do not define "plan assets." However, regulations promulgated
under ERISA by the United States Department of Labor, or the "DOL Plan Asset    
Regulations," generally provide that when an employee plan acquires an equity   
interest in an entity that is neither a "publicly-offered security" nor a       
security issued by an investment company registered under the Investment Company
Act of 1940, as amended, the                                                    

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employee plan's assets include both the equity interest in the entity and an    
undivided interest in each of the underlying assets of the entity, unless it is 
established either that equity participation in the entity by "benefit plan     
investors" is not "significant" or that the entity is an "operating company," in
each case as defined in the DOL Plan Asset Regulations.                         

Under the DOL Plan Asset Regulations, a security is a "publicly-offered         
security" if it is freely transferable, part of a class of securities that is   
widely-held, and either (i) part of a class of securities registered under      
section 12(b) or 12(g) of the Securities Exchange Act of 1934 or (ii) sold to an
employee plan as part of an offering of securities to the public pursuant to an 
effective registration statement under the Securities Act of 1933 and the class 
of securities of which that security is a part is registered under the          
Securities Exchange Act of 1934 within 120 days (or that later time as may be   
allowed by the Securities and Exchange Commission) after the end of the fiscal  
year of the issuer during which the offering of those securities to the public  
occurred. "Widely-held" for this purpose means the security is of a class owned 
by 100 or more investors independent of the issuer and of one another. "Freely  
transferable," again for purposes of the DOL Plan Asset Regulations, is a       
question to be determined on the basis of all relevant facts and circumstances  
but, where the minimum investment is $10,000 or less, is ordinarily not         
adversely affected by some enumerated restrictions including restrictions       
against any transfer which would result in a termination or reclassification of 
the issuer for federal tax purposes.                                            

For purposes of the DOL Plan Asset Regulations, equity participation in an      
entity by benefit plan investors is not "significant" if their aggregate        
interest is less than 25% of the value of each class of equity securities in the
entity, disregarding, for purposes of such determination, any interests held by 
persons, and their affiliates, who have discretionary authority or control with 
respect to the assets of the entity or who provide investment advice for a fee  
with respect to such assets. Benefit plan investors, for these purposes, include
employee plans and certain other types of plans, such as governmental plans, not
subject to Title I of ERISA.                                                    

The definition of "operating company" in the DOL Plan Asset Regulations         
includes, among other things, a "real estate operating company," or a REOC. In  
general, an entity may qualify as a REOC if (i) at least 50% of its assets      
valued at cost, other than short-term investments pending long-term commitment  
or distribution to investors are invested in real estate which is managed or    
developed and with respect to which the entity has the right to substantially   
participate directly in the management or development activities and (ii) such  
entity in the ordinary course of its business is engaged directly in real estate
management or development activities.                                           

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If our assets were deemed to be "plan assets" of employee plans whose assets    
were invested in us, whether as a result of the application of the DOL Plan     
Asset Regulations or otherwise, Subtitle A and Parts 1 and 4 of Subtitle B of   
Title I of ERISA and Section 4975 of the Code would extend to our investments.  
This would result, among other things, in (i) the application of the prudence   
and other fiduciary standards of ERISA, which impose liability on fiduciaries,  
to investments made by us, which could materially affect our operations,        
(ii) potential liability of persons having investment discretion over the assets
of the employee plans investing in us should our investments not conform to     
ERISA's prudence and fiduciary standards under Part 4 of Subtitle B of Title I  
of ERISA, unless certain conditions are satisfied, and (iii) the possibility    
that certain transactions that we might enter into in the ordinary course of our
business and operation might constitute "prohibited transactions" under ERISA   
and the Code. A prohibited transaction, in addition to imposing potential       
personal liability upon fiduciaries of the employee plans, may also result in   
the imposition of an excise tax under the Code upon the "party in interest," as 
defined in ERISA, or "disqualified person," as defined in the Code, with whom   
the employee plan engaged in the transaction, and correction or unwinding of the
transaction.                                                                    

Subject to the following, although we will not be obtaining an opinion of       
counsel, we believe that after this offering our stock should qualify as a      
"publicly offered security" under the DOL Plan Asset Regulations.               

While there are restrictions imposed on the transfer of our stock, we believe   
they are the type of restrictions on transfer generally permitted under the DOL 
Plan Asset Regulations or are not otherwise material and should not result in   
the failure of our stock to be "freely transferable" within the meaning of the  
DOL Plan Asset Regulations. We also believe that certain restrictions on        
transfer that derive from the securities laws in connection with this offering  
should not result in the failure of our stock to be "freely transferable."      
Furthermore, we are not aware of any other facts or circumstances limiting the  
transferability of our stock that are not included among those enumerated as not
affecting their free transferability under the DOL Plan Asset Regulations, and  
we do not expect to impose in the future (or to permit any person to impose on  
our behalf) any other limitations or restrictions on transfer that would not be 
among the enumerated permissible limitations or restrictions.                   

Assuming that our stock is "widely held" within the meaning of the DOL Plan     
Asset Regulations and that no facts and circumstances other than those referred 
to in the preceding paragraph exist that restrict transferability of our stock, 
we believe that, under the DOL Plan Asset Regulations, our stock should be      
considered "publicly offered securities" after this                             

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offering, and, therefore, that our underlying assets should not be deemed to be 
plan assets of any benefit plan investors that choose to invest in us.          

Annual Valuation

A fiduciary of an employee benefit plan subject to ERISA is required to         
determine annually the fair market value of each asset of the plan as of the end
of the plan's fiscal year and to file a report reflecting that value with the   
Department of Labor. When the fair market value of any particular asset is not  
available, the fiduciary is required to make a good faith determination of that 
asset's "fair market value" assuming an orderly liquidation at the time the     
determination was made. In addition, a trustee or custodian of an IRA must      
provide an IRA participant with a statement of the value of the IRA each year.  
In discharging its obligation to value assets of a plan, a fiduciary subject to 
ERISA must act consistently with the relevant provisions of the plan and general
fiduciary standards of ERISA.                                                   

Unless and until our shares are listed on a national securities exchange or     
over-the-counter market, it is not expected that a public market for the shares 
will develop. To date, neither the Internal Revenue Service nor the Department  
of Labor has promulgated regulations specifying how a plan fiduciary should     
determine the "fair market value" of shares when the fair market value of the   
shares is not determined in the marketplace. Therefore, to assist fiduciaries in
fulfilling their valuation and annual reporting responsibilities with respect to
ownership of our shares, we intend to provide reports of our annual             
determinations of the current value of our net assets per outstanding share to  
those fiduciaries (including IRA trustees and custodians) who identify          
themselves to us and request the reports. Until this offering terminates, we    
intend to use the offering price of shares as the per share net asset value.    
After this offering terminates, the value of our assets will be based on a      
valuation that we will perform internally.                                      

We anticipate that we will provide annual reports of our determination of value 
(1) to IRA trustees and custodians not later than January 15 of each year and   
(2) to other benefit plan fiduciaries within 75 days after the end of each      
calendar year. Each determination may be based upon valuation information       
available as of October 31 of the preceding year, up-dated, however, for any    
material changes occurring between October 31 and December 31.                  

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Plan and IRA fiduciaries will remain responsible to determine in their own      
judgment fair market value for applicable reporting purposes, taking into       
account the information we provide. We cannot assure you:                       

- that the value determined by us could or will actually be realized by us or by
 stockholders upon liquidation (in part because appraisals or estimated values
do not necessarily indicate the price at which assets could be sold and     
  because no attempt will be made to estimate the expenses of selling any of our
assets);                                                                    

- that stockholders could realize this value if they were to attempt to sell    
their shares; or                                                            

- that the value, or the method used to establish value, would comply with the  
ERISA or IRA requirements described above.                                  

SUMMARY OF REINVESTMENT PLAN

We currently have a dividend reinvestment plan available that allows you to     
purchase additional shares from the dividends otherwise distributable to you. A 
copy of our reinvestment plan as currently in effect is included as Exhibit A to
this prospectus. A Reinvestment Agent, currently Boston Capital                 
Securities, Inc., the dealer-manager, will act on behalf of the participants in 
the reinvestment plan.                                                          

ELIGIBILITY.  Stockholders may elect to participate in the dividend reinvestment
plan by completing the subscription agreement, or by other written notice to us.
Boston Capital Holdings Limited Partnership and its affiliates are not eligible 
to participate in the reinvestment plan.                                        

PARTICIPATION.  Participation in the dividend reinvestment plan will begin with 
the next distribution made after receipt of the participant's written notice. We
will provide you with a copy of our then current prospectus before you can agree
to participate in the reinvestment plan. An election to participate in the      
reinvestment plan will apply to all distributions attributable to the fiscal    
quarter in which the stockholder makes such written election to participate in  
the plan and to all fiscal quarters or months thereafter. Participants must     
elect to have all of their dividends reinvested in the plan. You cannot elect to
have only a portion of your dividends reinvested in the plan.                   

We may terminate the reinvestment plan for any reason at any time upon ten days'
prior written notice to participants. A participant's participation in the plan 
will also be terminated to the extent that a reinvestment of the participant's  
dividends in our shares would cause the percentage ownership limitation         
contained in our articles of incorporation to be exceeded. In addition,         
participants may terminate their participation in                               

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the reinvestment plan at any time by providing the Reinvestment Agent with      
written notice.                                                                 

COSTS AND FEES.  Stockholders may purchase shares under our dividend            
reinvestment plan for $9.30 per share until all of the shares registered as part
of this offering have been sold or this offering otherwise terminates. After    
that time, shares will be available for the reinvestment plan either through    
purchases made by the plan administrator on the open market, if a market then   
exists, or through additional issuances of shares. At any time that we are not  
engaged in an offering, and until our shares are listed on a national securities
exchange or market, the price per share purchased pursuant to the plan will be  
the fair market value of the shares as determined by our advisor in its sole    
discretion, based on quarterly appraisal updates of our properties. (Following  
the termination of this offering, the per share fair market value of our        
properties, at least initially, may be less than the $10 per share offering     
price.) After listing, if any, the price per share will be equal to the then    
prevailing market price on the national securities exchange or market on which  
the shares are listed at the date of purchase. We will pay a fee to the         
dealer-manager in the amount of 2% of the gross proceeds of the shares sold. In 
the event that proceeds from the sale of shares to participants are used to     
acquire interests in communities, we will pay our advisor or its affiliates     
acquisition and advisory fees and expenses of three and two tenths of one       
percent of the purchase price of the shares. The administrative charge for each 
plan participant for each fiscal quarter will be the lesser of 5% of the amount 
reinvested for the participant or $2.50, with a minimum charge of $0.50. The    
maximum annual charge is $10.00. A non-affiliated transfer agent, ACS Securities
Services, Inc., will provide the following services in connection with our      
dividend reinvestment plan: mailing and receiving the executed participation    
agreement; receiving written notice of desire to terminate participation; adding
new purchases to the participant's account; and mailing the statement of        
account. The administrative charge will be used to offset the fees paid to the  
transfer agent to perform these services.                                       

ADVANTAGES.  If stockholders participate in the reinvestment plan during the    
offering period, they can purchase additional shares without incurring any      
selling commissions. Another advantage of participating in the reinvestment plan
is the relative ease of acquiring additional shares.                            

REPORTS.  Within 60 days after the end of each fiscal quarter, the Reinvestment 
Agent will mail to each participant a statement of account describing the       
dividend distributions received during the quarter, the number of shares        
purchased during the quarter, the per share purchase price for such shares, the 
total administrative charge to such participant, and the total shares purchased 
on behalf of the participant. Tax information for                               

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income earned on shares under the Reinvestment Plan will be sent to each        
participant at least annually.                                                  

TAX CONSIDERATIONS.  If a stockholder elects to participate in the reinvestment 
plan and is subject to federal income taxation, the stockholder will incur a tax
liability for dividends allocated to him or her even though the stockholder has 
elected not to receive the dividends in cash but rather to have the dividends   
withheld and reinvested pursuant to the plan. Specifically, the stockholder will
be treated as if he or she has received the dividend from us in cash and then   
applied such dividend to the purchase of additional shares. The stockholder will
be taxed on the amount of such dividend as ordinary income to the extent such   
dividend is from current or accumulated earnings and profits, unless we have    
designated all or a portion of the dividend as a capital gain dividend or the   
dividend is eligible for the maximum 15% tax rate. See "Material United States  
Federal Income Tax Considerations--Taxation of Taxable U.S. Stockholders."      

SHARE REDEMPTION PROGRAM

Prior to the time that our shares are listed on a national securities exchange  
or market, stockholders (other than Boston Capital Holdings Limited Partnership 
and its affiliates) who have held their shares for at least one year, and who   
purchased their shares from us or received the shares through a non-cash        
transaction, not in the secondary market, may receive the benefit of limited    
interim liquidity by presenting for redemption all or any portion of their      
shares to us at any time in accordance with the procedures outlined below. At   
that time, we may, subject to the conditions and limitations described below,   
redeem the shares presented for redemption for cash to the extent that we have  
sufficient funds available to us to fund such redemption.                       

If you have held your shares for the required one-year period, and we are       
engaged in an offering, the redemption price will equal the lesser of (i) $9.15 
per share or (ii) the purchase price per share you actually paid for your       
shares. During the offering the redemption price will be equal to or below the  
price of the shares offered in this offering. During periods when we are not    
engaged in an offering, the per share price of our common stock, for purposes of
repurchase, will be based on periodic updates on the value of our properties, as
the board of directors determines based upon the Company's audited financial    
statements. Accordingly, the repurchase prices paid to stockholders for shares  
of common stock repurchased by us during periods when we are not engaged in an  
offering may vary over time. Our board of directors will announce any price     
adjustment and the time period of its effectiveness as a part of its regular    
communications with stockholders.                                               

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Shareholders may present us with shares for redemption at any time after you    
have held your shares for over one year by providing us with a written request  
stating the name of the entity owning the shares, the date the shares were      
purchased and the number of shares to be redeemed. The written request must be  
received before the last five business days of the calendar quarter to be       
eligible for that quarter's redemption. We have also provided participants with 
withdrawal rights at any time prior to the redemption.                          

The Company will redeem its common stock at the end of the calendar quarter in  
which such shares are presented, provided that the requisite redemption         
documents from shareholders are received by the reinvestment agent and we have  
received confirmation pursuant to a Uniform Commercial Code search that that no 
liens are held against the shares (at the cost of $100 to the shareholder, which
will be deducted from the proceeds of the redemption).                          

We are only allowed to use the proceeds from the dividend reinvestment plan to  
redeem shares under the redemption plan. In the event the proceeds from the     
dividend reinvestment plan exceeds the amount needed to redeem the shares for   
which redemption requests have been submitted, we would be permitted to carry   
such excess amount over to the next succeeding calendar quarter for use in      
addition to the amount of proceeds from the dividend reinvestment plan otherwise
available for redemptions during that calendar quarter.                         

In the event the amount of the proceeds from the dividend reinvestment plan is  
insufficient to redeem all of the shares for which redemption requests have been
submitted, we will redeem the shares on a pro rata basis at the end of each     
quarter. A shareholder, whose entire request is not honored, due to insufficient
available funds in that quarter, can ask that the request to redeem the shares  
be honored at such time, if any, as there are sufficient available funds. In    
such case, the redemption request will be retained and such shares will be      
redeemed, again on a pro rata basis, at the end of the next quarter.            
Alternatively, a shareholder whose shares are not redeemed may withdraw his or  
her repurchase request at any time. We can make no guarantee that there will be 
sufficient funds to redeem the shares for which a redemption request is         
received.                                                                       

Subject to funds being available, we will limit the number of shares redeemed   
pursuant to our share redemption program as follows: (i) during any calendar    
year, we will not redeem in excess of 3.0% of the weighted average number of    
shares outstanding during the prior calendar year; and (ii) funding for the     
redemption of shares will come exclusively from the                             

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proceeds we receive from the sale of shares under our dividend reinvestment plan
such that in no event shall the aggregate amount of redemptions under our share 
redemption program exceed aggregate proceeds received from the sale of shares   
pursuant to our dividend reinvestment plan. The board of directors, in its sole 
discretion and after 30 days' written notice to stockholders, may choose to     
terminate the share redemption program or to reduce the number of shares        
purchased under the share redemption program if it determines the funds         
otherwise available to fund our share redemption program are needed for other   
purposes. (See "Risk Factors--Risks Related to this Offering.")                 

Our share redemption program is only intended to provide interim liquidity for  
stockholders until a secondary market develops for the shares. No such market   
currently exists, and we cannot assure you that any market for your shares will 
ever develop. The share redemption program will terminate if a secondary market 
develops for the shares.                                                        

The shares we redeem under our share redemption program will be cancelled, and  
will be held as treasury stock. We will not resell such shares to the public    
unless they are first registered with the Securities and Exchange Commission    
under the Securities Act of 1933 and under appropriate state securities laws or 
otherwise sold in compliance with such laws.                                    

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SELLING AND ESCROW ARRANGEMENTS 
Selling Arrangements

We are offering a maximum of 100,000,000 shares at $10 per share on a "best     
efforts" basis through Boston Capital Securities, Inc., the dealer-manager.     
"Best efforts" means generally that the dealer-manager is required to use only  
its best efforts to sell the shares and it has no firm commitment or obligation 
to purchase any of the shares. We are also offering up to an additional         
5,000,000 shares to be issued pursuant to our dividend reinvestment plan at     
$9.30 per share. No shares will be sold unless subscriptions from the public for
at least 250,000 shares are received and accepted by January 1, 2007.           

The dealer-manager is a registered broker-dealer affiliated with our management 
and with our advisor. If the minimum offering is sold, we will pay the          
dealer-manager as compensation selling commissions of 7.0% of the public        
offering price of the shares sold in this offering ($0.70 per share). We will   
also pay the dealer-manager a dealer-manager fee of 2.0% of the public offering 
price of the shares sold as compensation for acting as the dealer-manager and   
for expenses incurred in connection with coordinating sales efforts, training of
personnel and generally performing "wholesaling" functions. We will not pay     
referral or similar fees to any accountants, attorneys or other persons in      
connection with the distribution of the shares. Stockholders who elect to       
participate in the dividend reinvestment plan will be charged dealer-manager    
fees on shares purchased pursuant to the dividend reinvestment plan.            

The dealer-manager may authorize certain other broker-dealers who are members of
the NASD to sell shares. In the event of the sale of shares by such other       
broker-dealers, the dealer-manager may reallow its commissions in the amount of 
up to 7.0% of the gross offering proceeds to such participating broker-dealers. 
In addition, the dealer-manager, in its sole discretion, may reallow to         
broker-dealers participating in the offering its dealer-manager fee in the      
amount of up to one and one-half percent of gross offering proceeds as          
additional compensation, based on such factors as the number of shares sold by  
such participating broker-dealers and the assistance of such participating      
broker-dealers in marketing the offering.                                       

The total underwriting compensation, (including, but not limited to, selling    
commissions, the dealer-manager fee, wholesaling salaries and commissions and   
expense reimbursements to our wholesalers and participating broker-dealers and  
their registered representatives) will not exceed the limitations prescribed by 
the National Association of Securities Dealers, Inc. An additional one-half     
percent of gross proceeds of this offering may be paid for bona fide due        
diligence expenses, also in accordance with                                     

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the current regulations of the National Association of Securities Dealers, Inc. 

We have agreed to indemnify the participating broker-dealers, including the     
dealer-manager, against certain liabilities arising under the Securities Act of 
1933, as amended. The dealer-manager and the participating broker-dealers may be
deemed underwriters as that term is defined in the Securities Act of 1933.      

The broker-dealers participating in the offering of our shares are not obligated
to obtain any subscriptions on our behalf, and we cannot assure you that any    
shares will be sold.                                                            

Our executive officers and directors and their family members, as well as       
officers and employees of our advisor, the Dealer Manager, Boston Capital       
Corporation or other affiliates and their family members, may purchase shares   
offered in this offering at a discount. The purchase price for such shares will 
be $9.30 per share reflecting the fact that selling commissions in the amount of
$0.70 per share will not be payable in connection with such sales. The net      
offering proceeds we receive will not be affected by such sales of shares at a  
discount. Any purchases of shares by our executive officers or directors or     
their family members or by officers or employees of our advisor, the Dealer     
Manager, Boston Capital Corporation or other affiliates or their family members 
will not be considered in order to meet the minimum offering. The family members
of any of the foregoing persons include the spouse, parents, children,          
grandparents, grandchildren and any such person who is so related by marriage   
such that this includes "step-" and "--in law" relations as well as such persons
so related by adoption. Our advisor and its affiliates will be expected to hold 
their shares purchased as stockholders for investment and not with a view       
towards distribution.                                                           

If you choose to buy shares in this offering, you must complete a subscription  
agreement like the one attached to this prospectus as Exhibit B. In completing  
the subscription agreement, you will be making certain acknowledgments--that you
received a copy of this prospectus not less than five business days prior to    
your signing the subscription agreement, that you meet the investor suitability 
standards described in the "Investor Suitability Standards" section of this     
prospectus, that you are purchasing the shares for your own account, that the   
shares are not liquid and that there are restrictions on their assignability and
transferability. We ask you to make these acknowledgments to further our        
obligations under federal and state securities laws not to sell the shares to   
investors for whom an investment in our Company would be unsuitable, and to     
evidence our efforts to fulfill those obligations if any of the acknowledgments 
you make turns out to be untrue.                                                

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You should pay for your shares by check payable to "Boston Private Bank & Trust 
Company as Custodian for Boston Capital REIT (BPB&TC C/F BCREIT)." Subscriptions
will be effective only upon our acceptance, and we reserve the right to reject  
any subscription in whole or in part. We may not accept a subscription for      
shares until at least five business days after the date you receive this        
prospectus. You will receive a confirmation of your purchase. Except for        
purchases pursuant to our dividend reinvestment plan, all accepted subscriptions
must be for whole shares and for not less than 100 shares ($1,000). (See        
"Investor Suitability Standards.") After investors have satisfied the minimum   
purchase requirement, minimum additional purchases must be in increments of at  
least 10 shares ($100), except for purchases made pursuant to our dividend      
reinvestment plan.                                                              

Investors who desire to establish an IRA for purposes of investing in shares may
do so by having Pershing LLC, an independent, qualified bank IRA custodian (or  
such other independent qualified bank IRA custodian utilized by a participating 
broker-dealer (a "Qualified IRA Custodian")), act as their IRA custodian.       

In the event that an IRA is established having Pershing LLC (or such other      
Qualified IRA Custodian) as the IRA custodian, the authority of Pershing LLC (or
such other Qualified IRA Custodian) will be limited to holding the shares on    
behalf of the beneficiary of the IRA and making distributions or reinvestments  
in shares solely at the discretion of the beneficiary of the IRA.               

Pershing LLC (or such other Qualified IRA Custodian) will not have the authority
to vote any of the shares held in an IRA except strictly in accordance with the 
written instructions of the beneficiary of the IRA.                             

The offering of shares will terminate no later than July 1, 2007 (unless        
extended with respect to the shares offered under our dividend reinvestment plan
or as otherwise permitted by applicable law). We reserve the right to terminate 
this offering at any time prior to such termination date.                       

The proceeds of this offering will be received and held in trust for the benefit
of purchasers of shares to be used only for the purposes set forth in the       
"Estimated Use of Proceeds" section of this prospectus. Subscriptions will be   
accepted or rejected within 30 days of receipt by us, and if rejected, all funds
will be returned to the rejected subscribers within ten business days.          

We may sell shares to retirement plans of broker-dealers participating in the   
offering, to broker-dealers in their individual capacities, to IRAs and         
qualified plans of their registered representatives or to any one of their      

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registered representatives in their individual capacities for 93% of the public 
offering price in consideration of the services rendered by such broker-dealers 
and registered representatives in the offering. The net proceeds to us from such
sales will be identical to net proceeds we receive from other sales of shares.  

In connection with sales of 50,000 or more shares ($500,000) to a "purchaser" as
defined below, a participating broker-dealer may agree in his or her sole       
discretion to reduce the amount of his or her selling commissions. Such         
reduction will be credited to the purchaser by reducing the total purchase price
payable by such purchaser. The following table illustrates the various discount 
levels available:                                                               

                                                        [Enlarge/Download Table]

                       Sales Commissions                                                
Dollar Volume        ---------------------  Purchase Price  Dealer-Manager  Net Proceeds
Shares Purchased     Percent    Per Share      Per Share     Fee Per Share    Per Share 
----------------     -------    ---------      ---------     -------------    --------- 
                                                                                        
Under $500,000         7.0%      $0.7000       $10.0000          $0.20          $9.10   
$500,000--$999,999     5.0%      $0.4895       $ 9.7895          $0.20          $9.10   
$1,000,000 and Over    3.0%      $0.2876       $ 9.5876          $0.20          $9.10   

For example, if an investor purchases 100,000 shares ($1,000,000), he could pay 
as little as $958,760 rather than $1,000,000 for the shares, in which event the 
commission on the sale of such shares would be $28,760 ($0.2876 per share), and,
after payment of the dealer-manager fee, we would receive net proceeds of       
$910,000 ($9.10 per share). The net proceeds to us will not be affected by      
volume discounts.                                                               

Because all investors will be deemed to have contributed the same amount per    
share to our Company for purposes of declaring and paying dividends, an investor
qualifying for a volume discount will receive a higher return on his investment 
than investors who do not qualify for such discount. Subscriptions may be       
combined for the purpose of determining the volume discounts in the case of     
subscriptions made by any "purchaser," as that term is defined below, provided  
all such shares are purchased through the same broker-dealer. The volume        
discount shall be prorated among the separate subscribers considered to be a    
single "purchaser." Any request to combine more than one subscription must be   
made in writing, and must set forth the basis for such request. Any such request
will be subject to verification by our advisor that all of such subscriptions   
were made by a single "purchaser."                                              

For purposes of such volume discounts, the term "purchaser" includes:           

- an individual, his or her spouse and their children under the age of 21 who   
purchase the units for his, her or their own accounts;                      

- a corporation, partnership, association, joint-stock company, trust fund or   
any organized group of persons, whether incorporated or not;                

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- an employees' trust, pension, profit sharing or other employee benefit plan   
qualified under Section 401(a) of the Internal Revenue Code; and            

- all commingled trust funds maintained by a given bank.                        

In addition, in order to encourage purchases in the amount of 500,000 or more   
shares ($5,000,000), our advisor and the dealer-manager may in their discretion 
agree with a potential purchaser who proposes to purchase at least 500,000      
shares ($5,000,000) to further reduce the selling commissions payable with      
respect to the sale of such shares. All such sales must be made through         
registered broker-dealers.                                                      

California residents should be aware that volume discounts will not be available
in connection with the sale of shares made to California residents to the extent
such discounts do not comply with the provisions of Rule 260.140.51 adopted     
pursuant to the California Corporate Securities Law of 1968. Pursuant to this   
Rule, volume discounts can be made available to California residents only in    
accordance with the following conditions:                                       

- there can be no variance in the net proceeds to us from the sale of the shares
to different purchasers of the same offering;                               

- all purchasers of the shares must be informed of the availability of quantity 
discounts;                                                                  

- the same volume discounts must be allowed to all purchasers of shares which   
are part of the offering;                                                   

- the minimum amount of shares as to which volume discounts are allowed cannot  
be less than $10,000;                                                       

- the variance in the price of the shares must result solely from a different   
range of commissions, and all discounts allowed must be based on a uniform  
scale of commissions; and                                                   

- no discounts are allowed to any group of purchasers.                          

Accordingly, volume discounts for California residents will be available in     
accordance with the foregoing table of uniform discount levels based on dollar  
volume of shares purchased, but no discounts are allowed to any group of        
purchasers, and no subscriptions may be aggregated as part of a combined order  
for purposes of determining the number of shares purchased.                     

Investors, who, in connection with their purchase of shares (i) have engaged the
services of a registered investor advisor or other financial advisor with whom  
the investor has agreed to pay compensation for investment advisory services or 
other financial or investment advice or (ii) has a contract for investment      
advisory and related brokerage services                                         

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which includes a fixed or "wrap" fee feature, may agree with the participating  
broker-dealer selling such shares and the dealer-manager to reduce the amount of
selling commissions payable with respect to such sales to zero. The net proceeds
to us, $9.30 per share, will not be affected by waiving the commissions payable 
in connection with such transactions. All such sales must be made through       
registered broker-dealers.                                                      

Neither the dealer-manager nor its affiliates will directly or indirectly       
compensate any person engaged as an investment advisor by a potential investor  
as an inducement for such investment advisor to advise favorably for investment 
in our Company.                                                                 

Escrow Arrangements 

During the course of the offering, subscription payments will be deposited and  
held in trust for the benefit of the purchasers of shares in an escrow account  
or accounts with Boston Private Bank & Trust Company as escrow agent. These     
proceeds may be temporarily invested in bank time deposits, certificates of     
deposit, bank money market accounts and government securities. Offering proceeds
deposited may not be withdrawn by purchasers, except that after the initial     
closing, subscriptions may be withdrawn by purchasers if such subscription      
payments are not released within six months after they are received by the      
escrow agent.                                                                   

If investors subscribe for at least 250,000 shares by January 1, 2007, we will  
have an initial closing of this offering and the funds in escrow will be        
released to our Company. If subscriptions for fewer than 250,000 shares are     
received and accepted by January 1, 2007, the offering will be terminated and   
all subscription payments will be returned to the subscribers. Following the    
initial closing, the escrow agent will, at our direction, release subscription  
payments with respect to subscriptions subsequent to completion of the minimum  
offering to our Company as soon as practicable. (See "Investor Suitability      
Standards" for escrow arrangements applicable to Pennsylvania investors.)       

Upon each closing (including the initial closing) of the offering (or its       
termination, if subscriptions for at least 250,000 shares are not received and  
accepted by January 1, 2007), a subscriber for shares will be entitled to       
receive an amount equal to the amount of the interest earned on his or her      
subscription proceeds held in the escrow account from the date after such       
proceeds were received in the escrow account until but not including the closing
(or termination) date or the date after which purchasers exercise any withdrawal
rights. Such interest distribution will be made within 75 days of the end of the
fiscal quarter following the relevant closing date, and will be made prior to,  
and without regard to, any distributions from our Company to which stockholders 
are entitled as                                                                 

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described under "Distribution Policy." In the case of interest due to           
subscribers upon termination of this offering because the minimum amount of the 
offering is not sold, such distributions will be made within five days following
such termination/withdrawal. The current interest rate is 3.35%, but the rate   
can adjust similar to a bank passbook savings rate.                             

Electronic Delivery 

We will deliver electronically all available documents relating to an investment
in our Company (including the reports to stockholders described below) to all   
stockholders who consent to electronic delivery of such documents by checking   
the applicable box in the subscription agreement. However, a stockholder may    
revoke consent to electronic delivery at any time by contacting BCCLP, Inc.,    
Investor Services for Boston Capital REIT, One Boston Place, Suite 2100, Boston,
MA 02180-4406 (Phone: 800-955-2733, Fax: 617-624-8999). If the stockholder      
revokes such consent, the stockholder will subsequently receive all such        
documents in paper format. In addition, a stockholder may request paper copies  
of any documents delivered electronically by contacting BCCLP, Inc. A           
stockholder's consent to electronic delivery is effective until revoked and     
relates to all documents relating to the stockholders' investment.              

Market for Our Stock

Before this offering, there has been no public market for our common stock. The 
initial public offering price was determined by our board of directors after    
consultation with the dealer-manager. In addition to prevailing market          
conditions, the factors considered in determining the initial public offering   
price were                                                                      

- the prospects for our Company and the industry in which we compete,           

- an assessment of our management, its past and present operations, and the     
prospects for, and timing of, our future revenues,                          

- the present state of our development, and                                     

- the above factors in relation to market values and various valuation measures 
of other companies engaged in activities similar to ours.                   

Following this offering, our shares will not be listed on any securities        
exchange, and there are no assurances that any market for the shares will       
develop. Therefore, it will be difficult for you to sell your shares promptly.  
In addition, the price received for any shares sold is likely to be less than   
the proportionate value of the real estate we own. It is also possible that     
after the offering, the price received for any shares sold will be less than the
initial public offering price.                                                  

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REPORTS TO STOCKHOLDERS 

We will provide an annual report to each stockholder within one hundred and     
twenty (120) days following the close of each fiscal year. Each annual report   
will contain, among other things, financial statements prepared in accordance   
with generally accepted accounting principles which are audited and reported on 
by our independent registered public accountant.                                

In addition, we will provide, upon written request by a stockholder, an interim 
report containing unaudited financial statements for each of the first three    
quarterly periods of each fiscal year within forty-five (45) days after the end 
of such quarter as well as such further information as our board of directors   
may determine is required pursuant to any law or regulation to which we are     
subject.                                                                        

At the same time as any distribution, we will file a Form 8-K or other          
appropriate form or report with the Securities and Exchange Commission or       
otherwise provide stockholders with a statement disclosing the source of the    
funds distributed. If the information is not available when the distribution is 
made, we will provide a statement setting forth the reasons why the information 
is not available. In no event will the information be provided to stockholders  
more than sixty (60) days after we make the distribution.                       

We are required by the Securities Exchange Act of 1934, as amended, to file     
quarterly, annual and periodic reports with the Securities and Exchange         
Commission. Those reports may contain information which is not set forth in this
prospectus. Such reports can be obtained on the Commission's website at         
www.sec.gov and on our website at www.bostoncapital.com and investors are       
encouraged to access such reports.                                              

SUPPLEMENTAL SALES MATERIAL 

In addition to this prospectus, we may use certain sales material in connection 
with the offering of the shares, although only when accompanied by or preceded  
by the delivery of this prospectus. In certain jurisdictions, some or all of    
such sales material may not be available. This material may include information 
relating to this offering, the past performance of our advisor and its          
affiliates, property brochures and articles and publications concerning real    
estate. In addition, this sales material may contain certain quotes from various
publications without obtaining the consent of the author or the publication for 
use of the quoted material in the sales material.                               

This offering of shares is made only by means of this prospectus. Although the  
information contained in such sales material will not conflict with any of the  
information contained in this prospectus, such material                         

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does not purport to be complete, and should not be considered a part of this    
prospectus or the registration statement of which this prospectus is a part, or 
as incorporated by reference into this prospectus or such registration statement
or as forming the basis of the offering of the shares.                          

EXPERTS 

Ernst & Young LLP, independent registered public accounting firm, has audited   
our consolidated financial statements and schedule at December 31, 2005 and for 
the year then ended, as set forth in their report. We've included our financial 
statements and schedule in the prospectus and elsewhere in the registration     
statement in reliance on Ernst & Young LLP's report, given on their authority as
experts in accounting and auditing.                                             

Certain of the financial statements appearing in this prospectus and the        
registration statement of which it is a part have been audited by Reznick Group,
P.C. (formerly known as Reznick Fedder & Silverman, Certified Public Accountants
a Professional Corporation) independent certified public accountants, as set    
forth in their report thereon appearing elsewhere in this prospectus and in the 
registration statement and are included in reliance upon that report, given upon
the authority of that firm as experts in accounting and auditing.               

LEGAL MATTERS 

The legality of the shares offered by this prospectus has been passed upon for  
us by Goodwin Procter LLP. The statements under the caption "Material United    
States Federal Income Tax Considerations" as they relate to federal income tax  
matters have been reviewed by Goodwin Procter LLP.                              

WHERE YOU CAN FIND MORE INFORMATION 

We have filed with the Securities and Exchange Commission a registration        
statement on Form S-11, including exhibits, schedules and amendments filed with 
this registration statement, under the Securities Act of 1933 with respect to   
the shares of our common stock to be sold in this offering. This prospectus does
not contain all of the information set forth in the registration statement and  
exhibits and schedules to the registration statement. For further information   
with respect to our Company and the shares of our common stock to be sold in    
this offering, reference is made to the registration statement, including the   
exhibits and schedules to the registration statement. Statements contained in   
this prospectus as to the contents of any contract or other document referred to
in this prospectus are not necessarily complete and, where that contract is an  
exhibit to the                                                                  

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registration statement, each statement is qualified in all respects by reference
to the exhibit to which the reference relates. Copies of the registration       
statement, including the exhibits and schedules to the registration statement,  
as well as periodic reports and other information filed by us in the future, may
be examined without charge at the public reference room of the Securities and   
Exchange Commission, 100 F Street, N.E., Room 1580, Washington, DC 20549.       
Information about the operation of the public reference room may be obtained by 
calling the Securities and Exchange Commission at l-800-SEC-0300. Copies of all 
or a portion of the registration statement can be obtained from the public      
reference room of the Securities and Exchange Commission upon payment of        
prescribed fees. In addition, the Securities and Exchange Commission maintains a
Web site at www.sec.gov that contains reports and other information filed       
electronically with the Commission, including our registration statement.       

We will establish an internet-accessible area for our Company on the web site of
Boston Capital Corporation, www.bostoncapital.com. The information on our       
website does not constitute a part of this prospectus.                          

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Index to Financial Statements 

                                                                [Download Table]

                                                                Page  
                                                              --------
                                                                      
Boston Capital Real Estate Investment Trust, Inc. successor           
  to BCMR Seattle, Inc. (December 31, 2005 and 2004)........     F-3  

Schedule III--Real Estate and Accumulated Depreciation......    F-35  
(All other schedules are omitted because they are not                 
  applicable or the required information is included in the           
  notes to the financial statements.)                                 

BCMR Seattle, Inc. (May 15, 2003)...........................    F-36  

ProForma Statements.........................................    F-51  

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BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC. 
successor to

BCMR SEATTLE, INC.

TABLE OF CONTENTS 

                                                                [Download Table]

                                                                Page  
                                                              --------
                                                                      
CONSOLIDATED FINANCIAL STATEMENTS:                                    

  Consolidated Balance Sheets at December 31, 2005 and                
    2004....................................................     F-6  

  Consolidated Statements of Operations for the years ended           
    December 31, 2005 and 2004 and for the period May 15,             
    2003 (inception) through December 31, 2003..............     F-7  

  Consolidated Statements of Stockholder's Deficit for the            
    years ended December 31, 2005 and 2004 and for the                
    period May 15, 2003 (inception) through December 31,              
    2003....................................................     F-8  

  Consolidated Statements of Cash Flows for the years ended           
    December 31, 2005 and 2004 and for the period May 15,             
    2003 (inception) through December 31, 2003..............     F-9  

  Notes to Consolidated Financial Statements................    F-11  

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Report of Independent Registered Public Accounting Firm 

The Board of Directors and Stockholder                                          
Boston Capital Real Estate Investment Trust, Inc.                               

We have audited the accompanying consolidated balance sheet of Boston Capital   
Real Estate Investment Trust, Inc. as of December 31, 2005, and the related     
consolidated statements of operations, stockholder's deficit, and cash flows for
the year then ended. Our audit also included the 2005 financial statement       
schedule listed at page F-1. These financial statements and schedule are the    
responsibility of the Company's management. Our responsibility is to express an 
opinion on these financial statements and schedule based on our audit.          

We conducted our audit in accordance with the standards of the Public Company   
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. We were not engaged to perform an 
audit of the Company's internal control over financial reporting. Our audit     
included consideration of internal control over financial reporting as a basis  
for designing audit procedures that are appropriate in the circumstances, but   
not for the purpose of expressing an opinion on the effectiveness of the        
Company's internal control over financial reporting. Accordingly, we express no 
such opinion. An audit also includes examining, on a test basis, evidence       
supporting the amounts and disclosures in the financial statements, assessing   
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our    
audit provides a reasonable basis for our opinion.                              

In our opinion, the financial statements referred to above present fairly, in   
all material respects, the consolidated financial position of Boston Capital    
Real Estate Investment Trust, Inc. at December 31, 2005, and the consolidated   
results of its operations and its cash flows for the year then ended, in        
conformity with U.S. generally accepted accounting principles. Also, in our     
opinion, the related 2005 financial statement schedule, when considered in      
relation to the basic financial statements taken as a whole, presents fairly, in
all material respects, the information set forth therein.                       

     /s/ ERNST & YOUNG LLP

Boston, Massachusetts                                                           
March 21, 2006                                                                  

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Reznick Group, P.C. 

7700 Old Georgetown Road, Suite 400, Bethesda, MD 20814-6224
Phone 301.652.9100, Fax 301.652.1848
www.reznickgroup.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 

To the Shareholder                                                              
of Boston Capital Real Estate Investment Trust, Inc.                            

We have audited the accompanying consolidated balance sheets of Boston Capital  
Real Estate Investment Trust, Inc. (a Maryland corporation) and subsidiaries as 
of December 31, 2004 and 2003, and the related consolidated statements of       
operations, changes in stockholder's deficit, and cash flows for the year ended 
December 31, 2004 and for the period from May 15, 2003 (inception) through      
December 31, 2003. These consolidated financial statements are the              
responsibility of the Company'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 the standards of the Public Company  
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company has determined that it
is not required to have, nor were we engaged to perform, an audit of its        
internal control over financial reporting. Our audits included consideration of 
internal control over financial reporting as a basis for designing audit        
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control    
over financial reporting. Accordingly, we express no such opinion. 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.                              

As discussed in note B to the consolidated financial statements, the            
accompanying consolidated financial statements have been restated.              

In our opinion, the consolidated financial statements referred to above present 
fairly, in all material respects, the financial position of Boston Capital Real 
Estate Investment Trust, Inc. and subsidiaries as of December 31, 2004 and 2003,
and the results of its operations and its cash flows for the year ended         
December 31, 2004 and for the period from May 15,                               

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2003 (inception) through December 31, 2003, in conformity with accounting       
principles generally accepted in the United States of America.                  

We have also audited Schedule III for the year ended December 31, 2004. In our  
opinion, this schedule presents fairly, when considered in relation to the basic
financial statements taken as a whole, in all material respects, the information
therein.                                                                        

/s/ Reznick Group, P.C.                                                         

Bethesda, Maryland                                                              
March 25, 2005, except for the third paragraph in note A,                       
as to which the date is February 10, 2006 and the last                      
paragraph in note B as to which date is March 29, 2006                      

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Boston Capital Real Estate Investment Trust, Inc. 

CONSOLIDATED BALANCE SHEETS 

(Dollars in thousands except share amounts) 

                                                                [Download Table]

                                                  December 31,    December 31,  
                                                      2005       2004 (Restated)
                                                 --------------  ---------------
                                                                                
Assets                                                                          
  Real Estate                                                                   
    Land........................................    $ 31,084        $ 29,034    
    Building and improvements...................     147,478         133,528    
    Furniture, fixtures and equipment...........       8,290           6,805    
                                                    --------        --------    
                                                     186,852         169,367    
  Less accumulated depreciation.................     (13,140)         (7,564)   
                                                    --------        --------    
                                                     173,712         161,803    
  Cash and cash equivalents.....................       1,629           1,058    
  Accounts receivable-tenants, net of allowance                                 
    for doubtful accounts of $0 for 2005 and                                    
    2004........................................         156             147    
  Restricted cash...............................       2,889           2,465    
  Deferred financing costs, net of accumulated                                  
    amortization of $1,053 and $624,                                            
    respectively................................       1,240           1,432    
  Other assets, net of accumulated amortization                                 
    of $90 and $0, respectively.................       4,027           1,774    
                                                    --------        --------    
                                                    $183,653        $168,679    
                                                    ========        ========    
Liabilities                                                                     
  Line of credit-affiliate......................    $ 56,597        $ 56,597    
  Interest payable on line of credit............         366             326    
  Mortgage notes payable........................     132,525         120,596    
  Other note payable............................       5,556              --    
  Accounts payable and accrued expenses.........       3,260           2,484    
  Due to related party..........................       4,944           1,375    
  Other liabilities.............................         846             618    
                                                    --------        --------    
                                                     204,094         181,996    
Commitments and contingencies                                                   
Minority interest...............................         167              --    
Stockholder's Deficit                                                           
  Preferred stock, $.001 par value, 50,000,000                                  
    shares authorized, no shares issued and                                     
    outstanding.................................          --              --    
  Common stock, $.001 par value, 350,000,000                                    
    shares authorized, 20,000 shares issued and                                 
    outstanding.................................          --              --    
  Additional paid-in capital....................         200             200    
  Accumulated deficit...........................     (20,808)        (13,517)   
                                                    --------        --------    
                                                     (20,608)        (13,317)   
                                                    --------        --------    
                                                    $183,653        $168,679    
                                                    ========        ========    

See accompanying notes. 

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Boston Capital Real Estate Investment Trust, Inc. 

CONSOLIDATED STATEMENTS OF OPERATIONS 

(Dollars in thousands except per share amounts) 

                                                                [Download Table]

                                                                 Period May 15, 
                                                                2003 (inception)
                                  Year ended      Year ended        through     
                                 December 31,    December 31,     December 31,  
                                     2005            2004       2003 (Restated) 
                                --------------  --------------  ----------------
                                                                                
Rental revenue.................    $24,061         $21,257          $13,187     
                                   -------         -------          -------     
Expenses                                                                        
  Property operating costs.....      7,850           8,573            5,279     
  General and administrative...      3,164           2,863            1,917     
  Depreciation and                                                              
    amortization...............      6,096           4,988            2,629     
  Portfolio and management                                                      
    fees-related party.........      1,182           1,184              892     
  Asset management fee-related                                                  
    party......................      1,368              --               --     
  Organization costs...........         --              --            1,426     
                                   -------         -------          -------     
                                    19,660          17,608           12,143     
                                   -------         -------          -------     
Operating income...............      4,401           3,649            1,044     
                                   -------         -------          -------     
Interest (income) expense                                                       
  Interest expense on line of                                                   
    credit-affiliate...........      5,377           5,466            3,053     
  Interest expense-other.......      6,336           6,046            3,683     
  Interest income..............        (15)            (25)             (13)    
                                   -------         -------          -------     
                                    11,698          11,487            6,723     
                                   -------         -------          -------     
Loss before minority                                                            
  interest.....................     (7,297)         (7,838)          (5,679)    
Loss attributed to minority                                                     
  interest.....................         (6)             --               --     
                                   -------         -------          -------     
    Net loss...................    $(7,291)        $(7,838)         $(5,679)    
                                   =======         =======          =======     
Loss per share-basic and                                                        
  diluted......................    $  (365)        $  (392)         $  (284)    
                                   =======         =======          =======     
Weighted average common shares                                                  
  outstanding-basic and                                                         
  diluted......................     20,000          20,000           20,000     
                                   =======         =======          =======     

See accompanying notes. 

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Boston Capital Real Estate Investment Trust, Inc. 

CONSOLIDATED STATEMENTS OF STOCKHOLDER'S DEFICIT

(Dollars in thousands except share amounts) 

                                                                [Download Table]

                          Common Stock      Additional                        
                      --------------------   Paid in    Accumulated           
                       Shares     Amount     Capital      Deficit     Total   
                      --------   ---------  ----------  -----------  -------- 
                                                                              
Shares of common                                                              
  stock issued.......  20,000    $     --      $200      $     --    $    200 

Net loss                                                                      
  (Restated).........      --          --        --        (5,679)     (5,679)
                       ------    ---------     ----      --------    -------- 

Balance as of                                                                 
  December 31, 2003                                                           
  (Restated).........  20,000          --       200        (5,679)     (5,479)

Net loss.............      --          --        --        (7,838)     (7,838)
                       ------    ---------     ----      --------    -------- 

Balance as of                                                                 
  December 31, 2004                                                           
  (Restated).........  20,000          --       200       (13,517)    (13,317)

Net loss.............      --          --        --        (7,291)     (7,291)
                       ------    ---------     ----      --------    -------- 

Balance as of                                                                 
  December 31,                                                                
  2005...............  20,000    $     --      $200      $(20,808)   $(20,608)
                       ======    =========     ====      ========    ======== 

See accompanying notes. 

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Boston Capital Real Estate Investment Trust, Inc. 

CONSOLIDATED STATEMENTS OF CASH FLOWS 

(Dollars in thousands)

                                                        [Enlarge/Download Table]

                                                                           Period     
                                                                        May 15, 2003  
                                                                         (inception)  
                                         Year ended      Year ended        through    
                                        December 31,    December 31,    December 31,  
                                            2005            2004       2003 (Restated)
                                       --------------  --------------  ---------------
                                                                                      
Cash flows from operating activities                                                  
  Net loss...........................     $ (7,291)       $ (7,838)       $  (5,679)  
  Adjustments to reconcile net loss                                                   
    to net cash provided by (used in)                                                 
    operating activities                                                              
    Depreciation and amortization....        6,096           4,988            2,629   
    Loss allocated to minority                                                        
      interest.......................           (6)             --               --   
    Changes in assets and liabilities                                                 
      (Increase) decrease in accounts                                                 
        receivable--tenants..........           (9)             25             (172)  
      (Increase) decrease in                                                          
        restricted cash..............          (43)            (26)             708   
      (Increase) decrease in other                                                    
        assets.......................         (315)             37             (748)  
      Increase (decrease) in interest                                                 
        payable on line of credit--                                                   
        affiliate....................           40          (1,049)           3,053   
      Increase (decrease) in accounts                                                 
        payable and accrued                                                           
        expenses.....................          776             355              947   
      Increase (decrease) in due to                                                   
        related party................        1,616             391              287   
      Increase (decrease) in other                                                    
        liabilities..................          228              64              556   
                                          --------        --------        ---------   
        Net cash provided by (used                                                    
          in) operating activities...        1,092          (3,053)           1,581   
                                          --------        --------        ---------   
Cash flows from investing activities                                                  
  Investment in real estate..........      (17,485)         (5,862)              --   
  Other assets.......................         (207)             --               --   
  (Deposits) withdrawals from                                                         
    restricted cash..................         (381)          9,270            1,165   
  Construction in progress...........           --              --           (1,699)  
                                          --------        --------        ---------   
        Net cash (used in) provided                                                   
          by investing activities....      (18,073)          3,408             (534)  
                                          --------        --------        ---------   
Cash flows from financing activities                                                  
  Proceeds from mortgage notes                                                        
    payable..........................       23,981              --               --   
  Payment of mortgage note payable...      (12,052)            (43)             (39)  
  Proceeds from other note payable...        5,556              --               --   
  Financing costs paid...............         (237)             --              (96)  
  Due to related party...............        1,953             698               --   
  Payment of deferred offering                                                        
    costs............................       (1,822)         (1,064)              --   
  Proceeds from sale of common                                                        
    stock............................           --              --              200   
  Minority interest..................          175              --               --   
  Distributions to minority                                                           
    partner..........................           (2)             --               --   
                                          --------        --------        ---------   
        Net cash provided by (used                                                    
          in) financing activities...       17,552            (409)              65   
                                          --------        --------        ---------   
        Net increase (decrease) in                                                    
          cash and cash                                                               
          equivalents................          571             (54)           1,112   

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Boston Capital Real Estate Investment Trust, Inc. 

CONSOLIDATED STATEMENTS OF CASH FLOWS 

(Dollars in thousands)

                                                        [Enlarge/Download Table]

                                                                          Period     
                                                                       May 15, 2003  
                                                                        (inception)  
                                        Year ended      Year ended        through    
                                       December 31,    December 31,    December 31,  
                                           2005            2004       2003 (Restated)
                                      --------------  --------------  ---------------
                                                                                     
Cash and cash equivalents, beginning                                                 
  of period..........................       1,058           1,112               --   
                                         --------        --------        ---------   
Cash and cash equivalents, end of                                                    
  period.............................    $  1,629        $  1,058        $   1,112   
                                         ========        ========        =========   
Supplemental cash flow information:                                                  
  Interest paid (includes $5,337,                                                    
    $6,515 and $1,679, respectively,                                                 
    of related party interest).......    $ 11,615        $ 12,561        $   4,971   
                                         ========        ========        =========   
Noncash Investing and financing                                                      
  activities                                                                         
  Real estate assets acquired........    $     --        $     --        $ 161,757   
  Escrows funded.....................          --              --           13,583   
  Financing costs incurred...........          --              --            1,934   
  Debts assumed......................          --              --         (177,274)  
                                         --------        --------        ---------   
    Net..............................    $     --        $     --        $      --   
                                         ========        ========        =========   

See accompanying notes. 

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE A--ORGANIZATION                                                            

Boston Capital Real Estate Investment Trust, Inc. (we or our), a Maryland       
Corporation, was formed on May 2, 2003 and commenced operations on May 15, 2003.
We are a real estate company engaged in the acquisition, ownership, management, 
and operation of market rate multifamily properties. Provided that we sell at   
least 250,000 shares in the offering described below, we plan to elect to be    
taxed as a real estate investment trust for federal income tax purposes,        
commencing with the taxable year ended December 31, 2005. We were initially     
capitalized by the sale of 20,000 shares of $.001 par value common stock to an  
affiliated entity. The offer price of $10.00 per share resulted in gross        
proceeds of $200,000.                                                           

Our day-to-day activities are managed by Boston Capital REIT Advisors, LLC, one 
of our affiliates under the terms and conditions of an advisory agreement (the  
Advisor). We have no employees of our own. Our advisor is wholly owned by Boston
Capital Holdings Limited Partnership. John P. Manning, our Chairman and Chief   
Executive Officer, is the general partner of and owns a limited partnership     
interest in Boston Capital Holdings Limited Partnership.                        

A Registration Statement on Form S-11 and the related prospectus, as amended and
supplemented (the "Prospectus"), were filed with the Securities and Exchange    
Commission and became effective June 22, 2005 in connection with a public       
offering of up to 100,000,000 shares of our common stock (excluding 5,000,000   
shares reserved for issuance pursuant to our dividend reinvestment plan). We    
began offering shares on July 1, 2005. The offering will terminate no later than
July 1, 2007 or the failure to sell at least 250,000 shares prior to the        
expiration of our affiliate line of credit on January 1, 2007, provided that we 
are unable to extend the line of credit. We have the right to terminate the     
offering at any time prior to these dates. All monies raised by the offering    
prior to selling the minimum shares will be placed in an escrow account and earn
interest at savings account rates based on the balance held in the account. The 
initial rate was 1.45% per annum, was increased to 2.25% per annum on           
October 18, 2005 and was further increased to 3.35% on December 14, 2005. The   
offering will be made on a best efforts basis; however, if the minimum shares   
required are not met by the termination date, the escrowed funds along with     
accrued interest will be returned to the investors.                             

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE A--ORGANIZATION (Continued)                                                
We have experienced losses since inception. We believe that a combination of our
efforts to increase rental revenue and contain operating costs at our apartment 
communities and our ability to extend the maturity date of our Wachovia loan and
defer certain discretionary capital improvements and payments to affiliates     
until January 2007 will be sufficient to meet our operating, debt service and   
other working capital needs for the next year.                                  

As of December 31, 2005, 2004 and 2003 we owned interests in 11, 10 and 10      
properties, respectively.                                                       

NOTE B--SIGNIFICANT ACCOUNTING POLICIES                                         

Basis of Accounting                                                             

The accompanying audited consolidated financial statements have been prepared in
accordance with U.S. generally accepted accounting principles.                  

Principles of Consolidation                                                     

The consolidated financial statements include our interest in wholly-owned and  
majority-owned or controlling operating limited liability companies that own    
apartment communities. Minority interest relates to the interest in a property  
partnership we do not wholly own. All inter-company balances and transactions   
have been eliminated in consolidation.                                          

Real Estate                                                                     

Real estate is stated at cost. All our real estate has been pledged as security 
for various notes payable as described more fully in Note D.                    

ACQUISITIONS                                                                    

We account for our real estate acquisitions using the purchase method of        
accounting in accordance with SFAS No. 141, "Business Combinations". The fair   
value of the real estate acquired is allocated to the acquired tangible assets, 
consisting of land, building and tenant improvements, and identified intangible 
assets and liabilities, consisting of the value of above-market and below-market
leases and the value of in-place leases, based in each case on their fair       
values.                                                                         

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (Continued)                             
The fair value of the tangible assets of an acquired property (which includes   
land, building and improvements) is determined by valuing the property as if it 
were vacant, and the "as-if-vacant" value is then allocated to land, building   
and tenant improvements based on our determination of the relative fair values  
of these assets. We determine the as-if-vacant fair value of a property using   
methods similar to those used by independent appraisers.                        

In allocating the fair value of the identified intangible assets and liabilities
of an acquired property, above-market and below-market in-place lease values are
recorded based on the present value (using an interest rate which reflects the  
risks associated with the leases acquired) of the difference between (i) the    
contractual amounts to be paid pursuant to the in-place leases and (ii) our     
estimate of fair market lease rates for the corresponding in-place leases,      
measured over a period equal to the remaining non-cancelable term of the lease. 
Our leases do not currently include fixed-rate renewal periods. At December 31, 
2005, we have not identified any above market or below market leases and        
consequently have not allocated any value to such assets.                       

The aggregate value of other acquired intangible assets, consisting of in-place 
leases, is measured by the excess of (i) the purchase price paid for a property 
after adjusting existing in-place leases to market rental rates over (ii) the   
estimated fair value of the property as if vacant. Factors we considered in     
performing these analyses include an estimate of carrying costs during the      
expected lease-up periods considering current market conditions and costs to    
execute similar leases. In estimating carrying costs, we include real estate    
taxes, insurance and other operating expenses and estimates of lost rental      
revenue during the expected lease-up periods based on current market demand. We 
also estimate costs to execute similar leases including leasing commissions,    
legal and other related costs. The value of in-place leases exclusive of the    
value of the above-market and below-market in-place leases is amortized to      
expense over the remaining non-cancelable periods of the respective leases. If a
lease were to be terminated prior to its stated expiration, all unamortized     
amounts relating                                                                

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (Continued)                             
to that lease would be written off. At December 31, 2005, we have allocated a   
value of $207 to in place leases associated with the acquisition of the Plano   
community. This allowance value (net of amortization) is included in other      
assets on the consolidated balance sheets. The weighted average amortization    
period for the in-place leases at December 31, 2005 is four months.             

DEPRECIATION                                                                    

Buildings and furniture, fixtures and equipment are depreciated on the straight 
line method over 40 and 5 years respectively from the date of acquisition.      
Building improvements are depreciated on the straight line method over their    
estimated service lives, as determined by management, generally between 5 and   
15 years. Depreciation expense for the years ended December 31, 2005 and 2004   
and for the period May 15, 2003 through December 31, 2003 was $5,576, $4,670 and
$2,407, respectively.                                                           

IMPAIRMENT                                                                      

We periodically evaluate our long-lived assets, including our investments in    
real estate, for impairment indicators in accordance with SFAS No. 144,         
"Accounting for the Impairment or Disposal of Long-Lived Assets". The judgments 
regarding the existence of impairment indicators are based on factors such as   
operational performance, market conditions, expected holding period of each     
asset and legal and environmental concerns.                                     

If impairment indicators are present, we compare the expected future            
undiscounted cash flows for the long-lived asset against the carrying amount of 
that asset. If the sum of the estimated undiscounted cash flows is less than the
carrying amount of the asset, an impairment loss would be recorded for the      
difference between the estimated fair value and the carrying amount of the      
asset.                                                                          

We have not identified any impairment indicators and consequently have not      
recognized an impairment loss on any of our communities.                        

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (Continued)                             
Cash and Cash Equivalents                                                       

All highly liquid investments with an original maturity of three months or less 
are considered to be cash equivalents. We maintain our cash and restricted cash 
accounts with various financial institutions. Cash balances are insured by the  
Federal Deposit Insurance Corporation up to $100. As of December 31, 2005 and   
2004, the uninsured portion of the cash and restricted cash balances held at the
financial institutions was $1,559 and $844, respectively.                       

Accounts Receivable--Tenant                                                     

Tenant receivables are reported net of an allowance for doubtful accounts.      
Management's estimate of the allowance is based on historical collection        
experience and a review of the current status of tenant accounts receivable. It 
is reasonably possible that management's estimate of the allowance will change. 

Deferred Financing Costs                                                        

Deferred financing costs include fees and costs to obtain our line of credit,   
mortgages and other note payable. These costs are amortized over the term of the
respective loans.                                                               

Deferred Offering Costs                                                         

The costs incurred in connection with our anticipated public offering of common 
stock are deferred and will be deducted from the gross offering proceeds of the 
offering. Deferred offering costs were $2,747 and $1,064, respectively, at      
December 31, 2005 and 2004, and are included in other assets in the accompanying
balance sheets.                                                                 

Revenue Recognition                                                             

Tenant leases are classified as operating leases. Rental income attributable to 
leases is recorded when due from tenants and is recognized monthly as it is     
earned, which is not materially different from on a straight-line basis. Leases 
between a tenant and property for the rental of an apartment unit are generally 
year-to-year, renewable upon consent of both parties on an                      

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (Continued)                             
annual basis. Advanced receipts of rental income are deferred and classified as 
liabilities until earned. Interest income is recorded on an accrual basis.      

Organization Costs                                                              

Organization costs are expensed as incurred.                                    

Earnings Per Share                                                              

Earnings per share is calculated based on the weighted average number of common 
shares outstanding during the period. We have no common share equivalents,      
instruments convertible into common shares or other dilutive instruments.       

Reclassifications                                                               

Certain amounts in the 2004 and 2003 period have been reclassified to conform to
the 2005 presentation.                                                          

Recent Accounting Pronouncements and Interpretations                            

In December 2004, the Financial Accounting Standards Board ("FASB") issued SFAS 
No. 123 (revised 2004), "Share-Based Payment" ("SFAS 123R"), which replaces SFAS
No. 123, "Accounting for Stock-Based Compensation" ("SFAS 123") and supersedes  
APB Opinion No. 25, "Accounting for Stock Issued to Employees." SFAS 123R       
requires all share-based payments to employees, including grants of employee    
stock options, to be recognized in the financial statements based on their fair 
values beginning with the first interim or annual period after June 15, 2005.   
Under SFAS 123R, we must determine the appropriate fair value model to be used  
for valuing share-based payments, the amortization method for compensation cost 
and the transition method to be used at date of adoption. We adopted SFAS 123R  
in 2005. SFAS 123R did not have any material effect on our financial statements.

In June 2005, the FASB ratified the consensus in Emerging Issues Task Force     
Issue No. 04-5, "Determining Whether a General Partner, or the General Partners 
as a Group, Controls a Limited Partnership or Similar                           

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (Continued)                             
Entity When the Limited Partners Have Certain Rights" ("EITF 04-5"), which      
provides guidance in determining whether a general partner controls a limited   
partnership. EITF 04-5 states that the general partner in a limited partnership 
is presumed to control that limited partnership. The presumption may be overcome
if the limited partners have either (1) the substantive ability to dissolve the 
limited partnership or otherwise remove the general partners without cause or   
(2) substantive participating rights, which provide the limited partner with the
ability to effectively participate in significant decisions that would be       
expected to be made in the ordinary course of the limited partnership's business
and thereby preclude the general partner from exercising unilateral control over
the partnership. Our adoption of EITF 04-5 which is effective for new or        
modified limited partnerships as of June 30, 2005 and all other limited         
partnership arrangements as of January 1, 2006 is not expected to have a        
material effect on our financial position or results of operations.             

Restatement                                                                     

In 2005, we concluded that some property operating costs and interest expense   
related to certain mortgages on our properties for the month of December should 
have been accrued in our consolidated financial statements at December 31, 2004 
and 2003. Accordingly, the 2004 and 2003 balance sheets statements of           
operations, changes in stockholder's deficit, and cash flows have been restated 
to give effect of this correction. As a result of the adjustments, accounts     
payable and accrued expenses and accumulated deficit have increased by $379 in  
2004 and accounts payable and accrued expenses, property and operating costs and
interest expense have increased by $379, $114 and $265, respectively, in 2003.  
Also, the loss per share for the period May 15, 2003 (inception) through        
December 31, 2003 increased by $19. In 2005, we also concluded that some of the 
predecessor's revenue, operating expenses and interest expense were included in 
our consolidated statement of operations for the period May 15, 2003 (inception)
through December 31, 2003. Accordingly the 2003 statement of operations has been
restated to give effect of this correction. As a result of the adjustments,     
revenue, operating expenses and                                                 

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE B--SIGNIFICANT ACCOUNTING POLICIES (Continued)                             
interest expense decreased by $2,611, $1,701 and $910, respectively. There was  
no effect on net loss or the loss per share.                                    

The following table sets forth the previously reported and restated amounts     
within our consolidated balance sheet as of December 31, 2004.                  

                                                                [Download Table]

                               Amount as                        
                               Originally   Amount as           
                                Reported    Restated     Change 
                               ----------   ---------   --------
                                                                
BALANCE SHEET                                                   
Accounts payable and accrued                                    
  expense....................   $  2,105    $  2,484     $(379) 
Accumulated deficit..........   $(13,138)   $(13,517)    $ 379  

The following table sets forth the previously reported and restated amounts     
within our consolidated balance sheets as of December 31, 2003 and within our   
consolidated statements of operations for the period May 15, 2003 (inception)   
through December 31, 2003.                                                      

                                                                [Download Table]

                              Amount as                        
                              Originally   Amount as           
                               Reported    Restated     Change 
                              ----------   ---------   --------
                                                               
BALANCE SHEET                                                  
Accounts payable and accrued                                   
  expense...................   $  1,750    $  2,129    $   379 
Accumulated deficit.........   $ (5,300)   $ (5,679)   $  (379)

STATEMENT OF OPERATIONS                                        
Total revenue...............   $ 15,798    $ 13,187    $(2,611)
Operating expenses..........   $ 13,730    $ 12,143    $(1,587)
Interest (income) expense...   $  7,368    $  6,723    $  (645)
Net loss....................   $ (5,300)   $ (5,679)   $  (379)
Net loss per share..........   $   (265)   $   (284)   $   (19)

STATEMENT OF CASH FLOWS                                        
Interest paid...............   $  5,884    $  4,971    $  (913)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE C--PROPERTY ACQUISITIONS                                                   

On September 15, 2005, we acquired a majority interest in an apartment community
consisting of 229 units in Plano, Texas, for a purchase price of $15,200. We    
have included the results of operations of this community in our consolidated   
statement of operations from the date of acquisition. We allocated the purchase 
price of the community to the fair value of the assets received. We acquired our
interest in the property through BC Broadstone Preston, LP, a joint venture     
formed between us and a joint venture partner who contributed $175 toward the   
purchase price. We borrowed approximately $5,556 from Wachovia Bank, National   
Association to fund a portion of the purchase price, and the remainder was      
funded by a $11,981 mortgage loan from Deutsche Bank Berkshire Mortgage, Inc.   
Loan proceeds were also used to pay customary closing costs of $831 and to fund 
$1,700 into renovation and operating reserve accounts.                          

NOTE D--FINANCING                                                               

MORTGAGE NOTES PAYABLE                                                          

                                                                [Download Table]

                                                 2005       2004  
                                               --------   --------
                                                                  
Mortgage notes payable to Berkshire Mortgage                      
Finance Limited Partnership. The notes bear                       
interest at 4.67% and mature on January 1,                        
2008. Monthly interest only payments of $147                      
are required beginning February 1, 2003. Upon                     
maturity of the fixed rate note, we can                           
either make a balloon payment for any unpaid                      
principal or convert the note to a new fixed                      
or variable rate note with a final maturity                       
of December 31, 2012, subject to certain                          
covenants. The notes are secured by first                         
mortgages and deeds of trust on the                               
communities in the Seattle portfolio.........  $ 37,850   $ 37,850

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE D--FINANCING (Continued)                                                   

                                                                [Download Table]

                                                 2005       2004  
                                               --------   --------
                                                                  
Mortgage notes payable to Berkshire/WAFRA                         
Mezzanine Debt Investors Foreign Fund. The                        
notes bear interest at 12% and mature on                          
December 31, 2007. Monthly principal and                          
interest payments of $86 are required                             
beginning February 1, 2003 with a balloon                         
payment due at maturity. Amortization is                          
calculated based on a 25 year term. The loan                      
can be extended for an additional one-year                        
term provided that no event of default exists                     
and we pay a 1% extension fee................     7,987      8,039

Mortgage notes payable to Berkshire Mortgage                      
Finance Limited Partnership. The notes bear                       
interest at rates from 4.26% to 4.32% and                         
mature on June 1, 2010. Monthly interest only                     
payments of $126 are required beginning                           
July 1, 2003. A balloon payment is due at                         
maturity. The notes are secured by mortgages                      
and deeds of trust on the communities in the                      
Jacksonville portfolio.......................    35,374     35,374

Mortgage notes payable to Berkshire Mortgage                      
Finance Limited Partnership. The notes bear                       
interest at 4.52% and mature on June 1, 2010.                     
Monthly interest only payments of $148 are                        
required beginning July 1, 2003. Upon                             
maturity of the fixed rate note, we can                           
either make a balloon payment for any unpaid                      
principal or convert the note to a new fixed                      
or variable rate note with a final maturity                       
of December 31, 2013, subject to certain                          
covenants. The notes are secured by mortgages                     
and deeds of trust on the communities in the                      
Portland portfolio...........................    39,333     39,333

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE D--FINANCING (Continued)                                                   

                                                                [Download Table]

                                                 2005       2004  
                                               --------   --------
                                                                  
Mortgage notes payable to Deutsche Bank                           
Berkshire Mortgage Inc. The note bears                            
interest at 5.14% and matures November 1,                         
2014. Monthly interest only payments of $53                       
are required beginning December 1, 2005. A                        
balloon payment is due at maturity. The note                      
is secured by a mortgage and deed of trust on                     
the Plano community..........................    11,981         --
                                               --------   --------

                                               $132,525   $120,596
                                               ========   ========

Aggregate maturities of the above mortgage notes payable for the next five years
and thereafter are as follows:                                                  

                                                                [Download Table]
                                                  
2006....................................  $     61
2007....................................     7,926
2008....................................    37,850
2009....................................        --
2010....................................    74,707
Thereafter..............................    11,981
                                          --------
Total...................................  $132,525
                                          ========

An affiliate of the operator of the Seattle portfolio has provided limited      
guarantees of payment of the $37,850 and $8,120 on the senior and mezzanine     
notes payable, respectively, related to the Seattle portfolio. The guarantees   
are limited to situations such as failure to pay rents to which the lender is   
entitled in the event of default, failure to apply insurance or condemnation    
proceeds or security deposits from tenants as required by the lender, fraud or  
written misrepresentation, failure to first apply rents to pay reasonable       
operating expenses and then to debt service, acquisition of any property or     
operation of any business not permitted by the lender, a transfer that is an    
event of default, any and all indemnification obligations as defined by the     
lender or commencement of voluntary bankruptcy.                                 

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE D--FINANCING (Continued)                                                   

Affiliates of the operator of the Jacksonville portfolio have provided limited  
guarantees of payment on two of the notes totaling $16,274 related to the       
Jacksonville portfolio. The guarantees are limited to situations such as failure
to pay rents to which the lender is entitled in the event of a default, failure 
to apply insurance or condemnation proceeds as required by the lender, fraud or 
written material misrepresentation, acquisition of any property or operation of 
any business not permitted by the security instrument, failure to first apply   
rents to pay reasonable operating expenses and commencement of voluntary        
bankruptcy.                                                                     

LINE OF CREDIT--AFFILIATE                                                       

We have a $60,000 line of credit with an affiliate. The affiliate line of credit
bears "base" interest at 9.5% and "bonus" interest at 5.3% and matures on       
January 1, 2007. Base interest accrues in arrears and is due and payable with   
respect to each calendar quarter to the extent of cash available for debt       
service for the current quarter. In the event cash is not available for debt    
service in the current quarter, base interest is accrued and added to principal.
Bonus interest is due and payable with respect to each calendar quarter to the  
extent of cash available for debt service after payment of base interest. Any   
unpaid bonus interest is accrued but will not be added to principal. Accrued    
bonus interest is payable quarterly solely from cash available for debt service 
after payment of the current quarter base and bonus interest. Any accrued bonus 
interest not paid on or before the maturity date is not due or payable. As of   
December 31, 2005 and 2004, the accrued bonus interest was $7,832 and $4,832,   
respectively. We do not believe that sufficient cash flow will exist to pay     
bonus interest; therefore no accrual for it has been made in these financial    
statements. Our affiliate line of credit is secured by our interests in the     
Seattle, Jacksonville and Portland portfolios, and our outstanding shares. As of
December 31, 2005 and 2004, $56,597 was outstanding on the line. In connection  
with the extension of the line to January 1, 2007, we have agreed with the      
affiliate that will not borrow further amounts on the line. During the years    
ended December 31, 2005 and 2004 and for the period May 15, 2003 (inception)    
through December 31, 2003, base interest of                                     

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE D--FINANCING (Continued)                                                   
$5,377, $5,466, and $3,053, respectively, was incurred and $366 and $326,       
respectively, remained payable at December 31, 2005 and 2004.                   

OTHER NOTE PAYABLE                                                              

We borrowed $5,556 from Wachovia Bank evidenced by a note payable. The note is  
secured by the joint venture interests of our subsidiaries and is guaranteed by 
an affiliate. The note is interest only and bears interest at Libor plus 300    
basis points (7.37% at December 31, 2005). Interest is payable monthly to the   
extent that cash flow from the Plano community permits, and any unpaid interest 
accrues. The note matures on July 3, 2006. We may extend the maturity date for  
an additional period through January 1, 2007 provided no default or event of    
default shall then be in existence under the loan agreement; we pay an extension
fee equal to 42 basis points of the outstanding balance of the loan as of       
July 3, 2006; and we provide written notice to Wachovia Bank of our request for 
an extension of the maturity date no later than June 3, 2006. As of             
December 31, 2005 interest of $117 was incurred, of which $6 remained payable.  

NOTE E--INCOME TAXES                                                            

We expect to elect to be taxed as a REIT under the Internal Revenue Code,       
commencing with the taxable year ended December 31, 2005. We have been organized
and operated in a manner that we believe will allow us to qualify for taxation  
as a REIT under the Internal Revenue Code of 1986, as amended ("Code")          
commencing with the taxable year ended December 31, 2005, and we intend to      
continue to be organized and operate in this manner. As a REIT, we will not be  
required to pay federal corporate income taxes on our taxable income to the     
extent it is currently distributed to stockholders.                             

Accordingly, we have not recorded any current or deferred taxes for the year    
ended December 31, 2005. However, qualification and taxation as a REIT depends  
upon our ability to meet the various on-going requirements imposed by the Code  
relating to gross income testing, asset diversification, distribution thresholds
and diversity of stock ownership, among other requirements. Accordingly, no     
assurance can be given that we will be                                          

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE E--INCOME TAXES (Continued)                                                
organized or able to operate in a manner so as to qualify or remain qualified as
a REIT. If we fail to qualify as a REIT in any taxable year, we will be subject 
to federal income tax (including any applicable alternative minimum tax) on our 
taxable income at the applicable corporate tax rates.                           

During the year ended December 31, 2005, we expect to generate a net operating  
loss of approximately $7,154. Additionally, during the period beginning May 15, 
2003 and ending December 31, 2004, we generated passive activity loss           
carryforwards of approximately $14,682. The 2005 net operating loss may be      
carried forward for up to 20 years. The passive activity losses may be carried  
forward indefinitely. The deferred tax assets attributable to these items were  
established by us using a federal tax rate of 34% and a state and local tax rate
of 6%. However, a corresponding valuation allowance was established at          
December 31, 2005, 2004 and 2003, in an amount equal to each deferred tax asset 
due to the uncertainty as to whether we will be able to use the loss            
carryforwards.                                                                  

We have acquired properties prior to the first day of the first taxable year for
which we expect to qualify as a REIT (which is anticipated to be January 1,     
2005, or the "REIT Commencement Date"). If we recognize gain on the disposition 
of any of these assets during the 10-year period beginning on the REIT          
Commencement Date, then we will be subject to tax at the highest regular        
corporate rate on the lesser of the Built-In Gain or the amount of gain         
recognized on the disposition of such asset. It may be possible to reduce the   
amount of such income subject to corporate level tax by certain loss            
carryforwards of ours. Built-in Gain for this purpose means the fair market     
value of the asset as of the REIT Commencement Date over our basis in the asset 
as of the REIT Commencement Date. We would be subject to this tax liability even
if we qualify and maintain our status as a REIT. In order to qualify as a REIT, 
we will be required to distribute an amount equal to at least 90% of our taxable
income, including the non-capital gain portion of any Built-In Gain.            

Finally, in order to qualify as a REIT, we cannot have at the end of any taxable
year any undistributed earnings and profits that are attributable to a non-REIT 
taxable year. We do not believe that we have any non-REIT                       

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE E--INCOME TAXES (Continued)                                                
earnings and profits as of December 31, 2005, and therefore we believe that we  
satisfy this requirement.                                                       

At December 31, 2005 and 2004, our net tax basis of our real estate assets is   
less than the amount set forth in our consolidated balance sheets by            
approximately $6,106 and $3,304, respectively.                                  

NOTE F--RESTRICTED CASH                                                         

As of December 31, 2005 and 2004, we maintained the following reserve and escrow
accounts:                                                                       

                                                                [Download Table]

    Reserve/Escrow       Restriction/Purpose    2005       2004  
-----------------------  -------------------  --------   --------
                                                                 
Real estate taxes and    Payment of real                         
insurance escrows        estate taxes and                        
                         property                                
                         insurance..........   $  512     $  469 

Replacement reserve      To fund the                             
                         purchase/                               
                         replacement of                          
                         personal                                
                         property...........       --        203 

Portfolio reserve        To fund operating                       
                         deficits of the                         
                         properties and to                       
                         fund payment of the                     
                         preferred return                        
                         reserve in the                          
                         event the preferred                     
                         return reserve is                       
                         depleted...........      185         84 

Capital improvements     To fund building                        
escrow                   improvements and                        
                         renovations of the                      
                         properties.........      156      1,234 

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE F--RESTRICTED CASH (Continued)                                             

                                                                [Download Table]

    Reserve/Escrow       Restriction/Purpose    2005       2004  
-----------------------  -------------------  --------   --------
                                                                 
Completion escrow        To fund the                             
                         rehabilitation and                      
                         improvements of the                     
                         Plano community as                      
                         required by the                         
                         mortgage lender....    1,543         -- 

Investment escrow        To fund                                 
                         improvements of the                     
                         Jacksonville                            
                         portfolio and to                        
                         fund payment of the                     
                         preferred return...      267        295 

Working capital reserve  To fund working                         
                         capital needs and                       
                         pay operating                           
                         expenses...........      226        180 
                                               ------     ------ 

Total.......................................   $2,889     $2,465 
                                               ======     ====== 

NOTE G--RELATED PARTY TRANSACTIONS                                              

LINE OF CREDIT--AFFILIATE                                                       

As of December 31, 2005 and 2004, $56,597 was outstanding on our affiliate line 
of credit (see note D). During the years ended December 31, 2005 and 2004 and   
for the period May 15, 2003 (inception) through December 31, 2003, base interest
of $5,377, $5,466, and $3,053, respectively, was incurred and $366 and $326,    
respectively, remained payable at December 31, 2005 and 2004.                   

PORTFOLIO MANAGEMENT FEES                                                       

During the year ended December 31, 2004 and for the period May 15, 2003         
(inception) through December 31, 2003, an affiliate earned portfolio            

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE G--RELATED PARTY TRANSACTIONS (Continued)                                  
management fees of $408 and $293, respectively, in connection with management of
the Seattle, Portland and Jacksonville portfolios. These fees are included in   
portfolio and management fees on the consolidated statements of operations. The 
fee is based on .25% of total development costs, defined as total equity        
investment and the amount of the original mortgage payable for each portfolio.  
During the fourth quarter of 2005, the affiliate waived all future portfolio    
management fees retroactive to January 1, 2005. As of December 31, 2005 and     
2004, $531 of fees related to the period May 15, 2003 through December 31, 2004 
remain payable to the affiliate and are included in due to related party on the 
consolidated balance sheets.                                                    

OFFERING, ACQUISITION AND ORGANIZATIONAL COSTS                                  

During the years ended December 31, 2005 and 2004, one of our affiliates paid or
advanced funds to pay $1,953 and $698, respectively, for various costs          
associated with operating the Company. During the year ended December 31, 2005  
we accrued an acquisition fee payable to an affiliate of $150 for the purchase  
of the Plano community. As of December 31, 2005 and 2004, the total amount of   
due to related parties for organization costs, deferred offering costs, prepaid 
expenses, acquisition costs and operating expenses is $2,926 and $823,          
respectively.                                                                   

ADVISORS FEES                                                                   

We have executed an advisory services agreement with the Advisor to pay the     
following fees:                                                                 

  ORGANIZATION AND OFFERING EXPENSES.  We will reimburse the Advisor for all
  organization and offering expenses advanced by the Advisor up to a maximum
  of 2.25% of Gross Offering Proceeds. Amounts that the Advisor has incurred
 to date are included in the offering, acquisition, and organization costs
section above.                                                          

   ASSET MANAGEMENT FEE.  We will pay the Advisor as compensation for advisory
    services rendered to us a monthly asset management fee in an amount equal to
1/12th of 0.75% of our Real Estate Asset Value as                       

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE G--RELATED PARTY TRANSACTIONS (Continued)                                  
 defined in the agreement as of the end of the preceding month. During the
 year ended December 31, 2005, the Advisor earned asset management fees of
 $1,368. As of December 31, 2005, the entire amount earned remains payable
   and is included in due to related party on the consolidated balance sheets.
   Our affiliate has been entitled to this fee since inception, but has waived
its right to all asset management fees from the time of inception though
December 31, 2004.                                                      

ACQUISITION FEES AND EXPENSES.  We will pay the Advisor, as compensation
payable for services rendered in connection with the investigation,     
selection and acquisition (by purchase, investment or exchange) of      
Properties, acquisition fees in an amount equal to up to 2.7% of Gross  
   Offering Proceeds and acquisition expenses in an amount equal to up to 0.5%
 of Gross Offering Proceeds. Amounts that the Advisor has incurred to date
 are included in the offering, acquisition, and organization costs section
above.                                                                  

SUBORDINATED DISPOSITION FEE.  If the Advisor or an affiliate provides a
substantial amount of the services (as determined by a majority of our  
Independent Directors) in connection with the sale of one or more       
Properties, we will pay the Advisor or an affiliate a subordinated      
 disposition fee equal to the lesser of (i) one-half of a competitive real
estate commission, or (ii) 3.0% of the sales price of such property or  
properties. The Subordinated Disposition Fee will be paid only if       
    stockholders have received total dividends in an amount equal to 100% of the
aggregate invested capital plus a 6.0% annual cumulative non-compounded 
return on their net invested capital. No such fees have been paid or are
payable from inception through December 31, 2005.                       

   SUBORDINATED SHARE OF NET SALE PROCEEDS.  A subordinated share of net sales
  proceeds will be payable to the Advisor in an amount equal to 15.0% of net
   sales proceeds remaining after the stockholders have received distributions
equal to the sum of the Stockholders' 6.0%                              

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE G--RELATED PARTY TRANSACTIONS (Continued)                                  
Return and 100% of invested capital. No such fees have been paid or are 
payable from inception through December 31, 2005.                       

  SUBORDINATED INCENTIVE LISTING FEE.  Upon listing on a national securities
   exchange registered under Section 6 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), or a national market system registered 
under Section 11QA of the Exchange Act ("Listing") the Advisor will be  
    entitled to a subordinated incentive listing fee in an amount equal to 10.0%
of the amount by which (i) the market value of our outstanding stock,   
measured by taking the average closing price or average of bid and asked
price, as the cause may be, over a period of 30 consecutive days during 
    which the stock is traded, with such period beginning 180 days after Listing
    ("Market Value"), plus the total of all distributions required to be paid to
   stockholders from our inception until the date of Listing, exceeds (ii) the
sum of (A) 100% of the invested capital and (B) the total distributions 
 required to be paid to the stockholders in order to pay the Stockholders'
6.0% Return from inception through the date of Listing.                 

DEALER MANAGER FEES                                                             

Our securities are being sold through an affiliate of the Advisor which is a    
registered Broker dealer (Dealer Manager). If the minimum offering is sold, the 
Dealer-Manager will receive a selling commission of 7% of the public offering   
price of the shares sold. The Dealer-Manager will also receive a fee of 2% of   
the public offering price of the shares sold as compensation for acting as the  
Dealer-Manager and for expenses incurred in connection with coordinating sales  
efforts, training of personnel and generally performing "wholesaling" functions.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE G--RELATED PARTY TRANSACTIONS (Continued)                                  
FEES TO OUR JOINT VENTURE PARTNERS                                              

Our joint venture partners are entitled to various fees as follows:             

PROPERTY MANAGEMENT FEES                                                

During the years ended December 31, 2005 and 2004 and for the period    
    May 15, 2003 (inception) through December 31, 2003, property management fees
of $818, $744 and $515, respectively, were paid to our joint venture    
affiliates in connection with management of the Seattle, Portland,      
    Jacksonville and Plano communities. The fee in connection with management of
each of the Seattle and Jacksonville portfolios is 3.5% of gross revenue
    from inception through December 31, 2005. A portion of the fee in connection
 with management of the Portland portfolio was 3.5% from inception through
    February 2005, and was renegotiated to 3.0% for the Boulder Creek and Bridge
   Creek communities in March 2005. The other portion of the fee in connection
with the Portland portfolio is .5% and is payable only after we have    
received the preferred return on our unreturned capital contribution as 
described in the Prospectus, with the unpaid amount accruing. The fee in
  connection with management of the Plano community is 3.5% of gross revenue
from September 15, 2005 (acquisition) through December 31, 2005. The    
 property management fees are included in portfolio and management fees on
   the consolidated statements of operations. As of December 31, 2005 and 2004
the accrued and unpaid property management fees due to our joint venture
   affiliates are $79 and $21, respectively and are included in due to related
party on the consolidated balance sheets.                               

INCENTIVE MANAGEMENT FEES                                               

During the years ended December 31, 2005 and 2004 and for the period    
 May 15, 2003 (inception) through December 31, 2003, excess operating cash
flow distributions of $263, $32 and $84, respectively, were paid to our 
   joint venture member of the Seattle communities. These amounts are included
in portfolio and management fees on the consolidated statements of      
operations. As of December 31, 2005 and                                 

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE G--RELATED PARTY TRANSACTIONS (Continued)                                  
   2004 the accrued and unpaid excess operating cash flow distributions due to
   our joint venture affiliate were $40 and $0, respectively, and are included
in due to related party on the consolidated balance sheets.             

During the years ended December 31, 2005 and 2004 and for the period    
   May 15, 2003 (inception) through December 31, 2003, a rate lock fee payment
  of $24, $24 and $14, respectively, was paid to our joint venture member of
    the Portland portfolio. The affiliate is entitled to be paid 0.06% per annum
of the principal of the first mortgage loans from the cash flow of the  
    Portland communities as compensation for its agreement to assume 100% of the
    risk of loss on the rate lock deposit on the first mortgage debt paid to the
first mortgage holder.                                                  

CONSTRUCTION MANAGEMENT FEE                                             

During the year ended December 31, 2005, $108 of construction management
fees were paid to an affiliate of the property manager of the Portland  
   communities in connection with capital improvements of the communities. The
  fees are included in building and improvements on the consolidated balance
sheets.                                                                 

During the year ended December 31, 2004, $766 of construction management
  fees were paid to an affiliate of the property manager of our Jacksonville
    portfolio in connection with the rehabilitation of the project. The fees are
 included in building and improvements on the consolidated balance sheets.

NET SALE PROCEEDS TO JOINT VENTURE PARTNERS                                     

Upon disposition, and only after we have received certain priority returns, the 
joint venture partners may be entitled to advisory service fees and portions of 
the net sale proceeds as detailed below.                                        

 JACKSONVILLE COMMUNITIES--The joint venture partner will receive 6.25% of
net sale proceeds. Affiliates of the joint venture partner will         

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE G--RELATED PARTY TRANSACTIONS (Continued)                                  
also receive an advisory services fee equal to 20% of our 93.75% of     
remaining sale proceeds.                                                

  SEATTLE AND PORTLAND COMMUNITIES--Affiliates of the joint venture partners
will receive 25% of any net sale proceeds.                              

   PLANO COMMUNITY--The joint venture partner will receive 40% of any net sale
proceeds.                                                               

NOTE H--STOCKHOLDERS' EQUITY                                                    

Common Stock                                                                    

At December 31, 2005, we have 20,000 shares of common stock outstanding valued  
at $200. Net proceeds of $200 from the offering were used to fund investments   
and commence operations.                                                        

Stock Option Plan                                                               

We have established a stock option plan ("Stock Option Plan") for our           
non-employee directors. The Stock Option Plan authorizes the grant of stock     
options that do not qualify as incentive stock options under Section 422 of the 
Internal Revenue Code, or Non-Qualified Stock Options. The exercise price of    
stock options may not be less than the fair market value of a share on the day  
the option is granted. The total number of shares subject to awards granted     
under the Stock Option Plan may not exceed 200,000. At December 31, 2005, 20,000
options to purchase shares of our common stock were outstanding under the Stock 
Option Plan of which 4,000 options were exercisable.                            

During 2005, options to purchase 15,000 shares of common stock were granted to  
our directors. Options granted under the Stock Option Plan are exercisable at   
the fair market value on the date of grant and, subject to termination of       
directorship, expire ten years from the date of the grant, are not transferable 
other than at death, and vest ratably over a four year period commencing from   
the date of grant.                                                              

The estimated fair value of the common stock options, which was estimated by    
reference to Black-Scholes-Merton formula, was immaterial at                    

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE H--STOCKHOLDERS' EQUITY (Continued)                                        
December 31, 2005. Therefore the fair value of options has not been recorded at 
December 31, 2005. Since the Stock Option Plan has characteristics significantly
different from those of traded options, and since the assumptions used in such  
model, particularly the volatility assumption, are subject to significant       
judgment and variability, the actual value of the options could vary materially 
from management's estimate.                                                     

NOTE I--FAIR VALUE OF FINANCIAL INSTRUMENTS                                     

In determining fair value of its financial instruments, we use available market 
information and appropriate valuation methodologies, such as discounted cash    
flow analysis. All methods of assessing fair value result in a general          
approximation of value, and such value may never actually be realized.          

Cash, restricted cash and accounts receivable--tenants are financial assets with
carrying values that approximate fair value. Line of credit--affiliate, interest
payable on line of credit--affiliate, notes payable, accounts payable and       
accrued expenses and due to related party are financial liabilities with        
carrying values that approximate fair value.                                    

NOTE J--SUBSEQUENT EVENTS                                                       

On January 12, 2006 a fire occurred at one of the Portland communities (Bridge  
Creek Apartments) that damaged twelve units. A joint investigation into the     
cause of the fire was conducted by the fire department and a cause and origin   
expert hired by the insurance company. They concluded that the cause was a      
weakened wire in the wall between two of the apartment units. Additionally, it  
was determined that negligence was not the cause of the weakened wire. No one   
was injured and displaced tenants were relocated to vacant units within Bridge  
Creek Apartments and Boulder Creek Apartments. The preliminary estimate to      
repair the damages ranges between $400 and $600, but contractors have begun     
exploratory demolition to better assess extent of damage and total cost of the  
repairs. The insurance deductible is $10, and it is anticipated to be incurred  
in the second quarter of 2006. It is also anticipated that rent loss insurance  
will cover lost rents and incurred expenses.                                    

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Boston Capital Real Estate Investment Trust, Inc. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005 

(Dollars in thousands, except per share data) 

NOTE J--SUBSEQUENT EVENTS (Continued)                                           
In January 2006, we issued 173 shares of 12% Series A Cumulative Non-Voting     
Preferred Stock. The shares were issued in a private placement for the purpose  
of having at least 100 shareholders to satisfy one of the qualifications we must
meet in order to qualify as a REIT. The outstanding preferred shares are subject
to redemption, in whole or in part, at any time following January 30, 2007 at a 
price of $500 per share plus all accrued and unpaid dividends.                  

NOTE K--QUARTERLY FINANCIAL DATA (Unaudited)                                    

Due to an oversight, asset management fee--related party expense was understated
by $374 in the first quarter of 2005. The financial data for the quarter ended  
March 31, 2005 has been adjusted to correct this oversight. The result of the   
adjustment was to increase operating expenses and net loss by $374. There was no
effect on the three and six months ended June 30, 2005 and the three and nine   
months ended September 30, 2005.                                                

                                                                [Download Table]

                               Quarter    Quarter    Quarter    Quarter 
                                ended      ended      ended      ended  
                               12/31/05   09/30/05   06/30/05   03/31/05
                               --------   --------   --------   --------
                                                                        
Rental revenue...............  $ 6,500    $ 6,039    $ 5,819    $ 5,703 
                               -------    -------    -------    ------- 
Net loss.....................  $(1,957)   $(1,898)   $(1,692)   $(1,744)
                               =======    =======    =======    ======= 
Loss per share-basic and                                                
  diluted....................  $   (98)   $   (95)   $   (85)   $   (87)
                               =======    =======    =======    ======= 

                                                                [Download Table]

                               Quarter    Quarter    Quarter    Quarter 
                                ended      ended      ended      ended  
                               12/31/04   09/30/04   06/30/04   03/31/04
                               --------   --------   --------   --------
                                                                        
Rental revenue...............  $ 5,599    $ 5,256    $ 5,021    $ 5,381 
                               -------    -------    -------    ------- 
Net loss.....................  $(2,006)   $(2,164)   $(1,634)   $(2,034)
                               =======    =======    =======    ======= 
Loss per share-basic and                                                
  diluted....................  $  (101)   $  (108)   $   (82)   $  (101)
                               =======    =======    =======    ======= 

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Boston Capital Real Estate Investment Trust, Inc. 

SCHEDULE III

REAL ESTATE AND ACCUMULATED DEPRECIATION

December 31, 2005 
(Amounts in thousands)

                                                        [Enlarge/Download Table]

                          Column A                               Column B               Column C                Column D          
------------------------------------------------------------  ---------------   -------------------------   ----------------      
                                                                                                            Cost Capitalized      
                                                                                                             subsequent to        
                                                                                 Initial cost to Company      acquisition         
                                                                                -------------------------   ----------------      
                                                                                             Buildings                            
                                                                                                and                               
                        Description                            Encumbrances       Land      improvements      Improvements        
------------------------------------------------------------  ---------------   --------   --------------   ----------------      
                                                                                                                                  
Seattle portfolio                                                                                                                 
  Alderwood Park Apartments.................................     $ 11,157       $ 3,358       $  9,504           $   36           
  Ridgegate Apartments......................................        8,984         2,213          8,231               46           
  Ridgetop Apartments.......................................       11,736         1,523         12,199               59           
  Wellington Apartments.....................................       13,960         1,720         14,546               95           
                                                                 --------       -------       --------           ------           
                                                                   45,837         8,814         44,480              236           
                                                                 --------       -------       --------           ------           
Portland portfolio                                                                                                                
  Boulder Creek Apartments..................................       11,375         2,559         14,492              127           
  Bridge Creek Apartments...................................       12,958         2,970         15,510              537           
  Settler's Point Apartments................................       15,000         3,997         17,954              290           
                                                                 --------       -------       --------           ------           
                                                                   39,333         9,526         47,956              954           
                                                                 --------       -------       --------           ------           
Jacksonville portfolio                                                                                                            
  Bay Pointe Apartments.....................................        9,800         3,000          8,353            2,827           
  Savannah Oaks Apartments..................................        6,474         1,550          6,541            1,188           
  Spicewood Springs Apartments..............................       19,100         6,144         21,188            1,168           
                                                                 --------       -------       --------           ------           
                                                                   35,374        10,694         36,082            5,183           
                                                                 --------       -------       --------           ------           
Plano portfolio                                                                                                                   
  Broadstone @ Willowbend...................................       11,981         2,050         12,477              110           
                                                                 --------       -------       --------           ------           
                                                                   11,981         2,050         12,477              110           
                                                                 --------       -------       --------           ------           
                                                                 $132,525       $31,084       $140,995           $6,483           
                                                                 ========       =======       ========           ======           
Notes to Schedule III:                                                                                                            

Reconciliation of total cost:                                                                                                     
  Balance at December 31, 2002..............................     $     --                                                         
    Additions during the period:                                                                                                  
      Acquisitions..........................................      157,552                                                         
                                                                 --------                                                         
  Balance at December 31, 2003..............................     $157,552                                                         
    Additions during the period:                                                                                                  
      Improvements..........................................        5,010                                                         
                                                                 --------                                                         
  Balance at December 31, 2004..............................     $162,562                                                         
    Additions during the period:                                                                                                  
      Acquisitions..........................................       14,527                                                         
      Improvements..........................................        1,473                                                         
                                                                 --------                                                         
Balance at December 31, 2005................................     $178,562                                                         
                                                                 ========                                                         
Reconciliation of accumulated depreciation:                                                                                       
  Balance at December 31, 2002..............................     $     --                                                         
    Additions during the period:                                                                                                  
      Depreciation expense..................................        2,377                                                         
                                                                 --------                                                         
  Balance at December 31, 2003..............................     $  2,377                                                         
    Additions during the period:                                                                                                  
      Depreciation expense..................................        3,572                                                         
                                                                 --------                                                         
  Balance at December 31, 2004..............................     $  5,949                                                         
    Additions during the period:                                                                                                  
      Depreciation expense..................................        4,110                                                         
                                                                 --------                                                         
  Balance at December 31, 2005..............................     $ 10,059                                                         
                                                                 ========                                                         


                          Column A                                          Column E                   Column F        Column G   
------------------------------------------------------------  ------------------------------------   -------------   -------------

                                                                 Gross amount at which carried                                    
                                                                       at close of period                                         
                                                              ------------------------------------                                
                                                                           Buildings                                              
                                                                              and                     Accumulated       Date of   
                        Description                             Land      improvements     Total     depreciation    construction 
------------------------------------------------------------  --------   --------------   --------   -------------   -------------
                                                                                                                                  
Seattle portfolio                                                                                                                 
  Alderwood Park Apartments.................................  $ 3,358       $  9,540      $ 12,898      $   726          1982     
  Ridgegate Apartments......................................    2,213          8,277        10,490          630          1990     
  Ridgetop Apartments.......................................    1,523         12,258        13,781          932          1989     
  Wellington Apartments.....................................    1,720         14,641        16,361        1,111          1988     
                                                              -------       --------      --------      -------                   
                                                                8,814         44,716        53,530        3,399                   
                                                              -------       --------      --------      -------                   
Portland portfolio                                                                                                                
  Boulder Creek Apartments..................................    2,559         14,619        17,178          950          1990     
  Bridge Creek Apartments...................................    2,970         16,047        19,017        1,048          1987     
  Settler's Point Apartments................................    3,997         18,244        22,241        1,191          1985     
                                                              -------       --------      --------      -------                   
                                                                9,526         48,910        58,436        3,189                   
                                                              -------       --------      --------      -------                   
Jacksonville portfolio                                                                                                            
  Bay Pointe Apartments.....................................    3,000         11,180        14,180        1,081          1974     
  Savannah Oaks Apartments..................................    1,550          7,729         9,279          700          1971     
  Spicewood Springs Apartments..............................    6,144         22,356        28,500        1,597          1985     
                                                              -------       --------      --------      -------                   
                                                               10,694         41,265        51,959        3,378                   
                                                              -------       --------      --------      -------                   
Plano portfolio                                                                                                                   
  Broadstone @ Willowbend...................................    2,050         12,587        14,637           93          1984     
                                                              -------       --------      --------      -------                   
                                                                2,050         12,587        14,637           93                   
                                                              -------       --------      --------      -------                   
                                                              $31,084       $147,478      $178,562      $10,059                   
                                                              =======       ========      ========      =======                   
Notes to Schedule III:                                                                                                            
Reconciliation of total cost:                                                                                                     
  Balance at December 31, 2002..............................                                                                      
    Additions during the period:                                                                                                  
      Acquisitions..........................................                                                                      
  Balance at December 31, 2003..............................                                                                      
    Additions during the period:                                                                                                  
      Improvements..........................................                                                                      
  Balance at December 31, 2004..............................                                                                      
    Additions during the period:                                                                                                  
      Acquisitions..........................................                                                                      
      Improvements..........................................                                                                      
Balance at December 31, 2005................................                                                                      
Reconciliation of accumulated depreciation:                                                                                       
  Balance at December 31, 2002..............................                                                                      
    Additions during the period:                                                                                                  
      Depreciation expense..................................                                                                      
  Balance at December 31, 2003..............................                                                                      
    Additions during the period:                                                                                                  
      Depreciation expense..................................                                                                      
  Balance at December 31, 2004..............................                                                                      
    Additions during the period:                                                                                                  
      Depreciation expense..................................                                                                      
  Balance at December 31, 2005..............................                                                                      


                          Column A                             Column H       Column I                                            
------------------------------------------------------------  ----------   ---------------                                        

                                                                            Life on which                                         
                                                                           depreciation in                                        
                                                                            latest income                                         
                                                                 Date       statement is                                          
                        Description                            acquired       computed                                            
------------------------------------------------------------  ----------   ---------------                                        
                                                                                                                                  
Seattle portfolio                                                                                                                 
  Alderwood Park Apartments.................................   05/15/03       5-40 yrs.                                           
  Ridgegate Apartments......................................   05/15/03       5-40 yrs.                                           
  Ridgetop Apartments.......................................   05/15/03       5-40 yrs.                                           
  Wellington Apartments.....................................   05/15/03       5-40 yrs.                                           
Portland portfolio                                                                                                                
  Boulder Creek Apartments..................................   05/30/03       5-40 yrs.                                           
  Bridge Creek Apartments...................................   05/30/03       5-40 yrs.                                           
  Settler's Point Apartments................................   05/30/03       5-40 yrs.                                           
Jacksonville portfolio                                                                                                            
  Bay Pointe Apartments.....................................   05/22/03       5-40 yrs.                                           
  Savannah Oaks Apartments..................................   05/22/03       5-40 yrs.                                           
  Spicewood Springs Apartments..............................   05/28/03       5-40 yrs.                                           
Plano portfolio                                                                                                                   
  Broadstone @ Willowbend...................................   09/15/05       5-40 yrs.                                           
Notes to Schedule III:                                                                                                            
Reconciliation of total cost:                                                                                                     
  Balance at December 31, 2002..............................                                                                      
    Additions during the period:                                                                                                  
      Acquisitions..........................................                                                                      
  Balance at December 31, 2003..............................                                                                      
    Additions during the period:                                                                                                  
      Improvements..........................................                                                                      
  Balance at December 31, 2004..............................                                                                      
    Additions during the period:                                                                                                  
      Acquisitions..........................................                                                                      
      Improvements..........................................                                                                      
Balance at December 31, 2005................................                                                                      
Reconciliation of accumulated depreciation:                                                                                       
  Balance at December 31, 2002..............................                                                                      
    Additions during the period:                                                                                                  
      Depreciation expense..................................                                                                      
  Balance at December 31, 2003..............................                                                                      
    Additions during the period:                                                                                                  
      Depreciation expense..................................                                                                      
  Balance at December 31, 2004..............................                                                                      
    Additions during the period:                                                                                                  
      Depreciation expense..................................                                                                      
  Balance at December 31, 2005..............................                                                                      

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Reznick Group, P.C. 
7700 Old Georgetown Road, Suite 400, Bethesda, MD 20814-6224
Phone 301.652.9100, Fax 301.652.1848
www.reznickgroup.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 

To the Shareholders                                                             
of BCMR Seattle, Inc.                                                           

We have audited the accompanying consolidated balance sheet of BCMR             
Seattle, Inc. (a Maryland corporation) and subsidiaries as of May 15, 2003      
(cessation) and the related consolidated statements of operations, changes in   
shareholder's equity, and cash flows for the period from January 1, 2003 through
May 15, 2003. These consolidated financial statements are the responsibility of 
the Company's management. Our responsibility is to express an opinion on these  
consolidated financial statements based on our audit.                           

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

As discussed in note B to the consolidated financial statements, the            
accompanying consolidated financial statements have been restated.              

In our opinion, the consolidated financial statements referred to above present 
fairly, in all material respects, the consolidated financial position of BCMR   
Seattle, Inc. as of May 15, 2003 (cessation) and the consolidated results of its
operations and its cash flows for the period from January 1, 2003 through       
May 15, 2003 in conformity with accounting principles generally accepted in the 
United States of America.                                                       

/s/ Reznick Group, P.C.                                                         

Bethesda, Maryland                                                              
March 9, 2004, except for note B                                                
as to which date is March 29, 2006                                          

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BCMR SEATTLE, INC.

CONSOLIDATED BALANCE SHEET

May 15, 2003

                                                                [Download Table]

                       ASSETS                                     
                                                                  
REAL ESTATE                                                       
  Land...............................................  $       -- 
  Buildings and improvements.........................          -- 
  Personal property..................................          -- 
                                                       ---------- 
                                                               -- 
  Less accumulated depreciation......................          -- 
                                                       ---------- 
                                                               -- 
                                                       ---------- 

OTHER ASSETS                                                      
  Cash...............................................          -- 
  Accounts receivable--tenants.......................          -- 
  Deferred tax asset.................................          -- 
  Tenants' security deposits.........................          -- 
  Reserve account....................................          -- 
  Real estate tax and insurance escrows..............          -- 
  Financing costs, net of accumulated amortization of             
    $0...............................................          -- 
  Capital improvements escrow........................          -- 
  Other assets.......................................          -- 
                                                       ---------- 
                                                       $       -- 
                                                       ========== 

        LIABILITIES AND SHAREHOLDER'S EQUITY                      
Notes payable........................................  $       -- 
Accounts payable and accrued expenses................          -- 
Unearned rental revenue..............................          -- 
Tenants' security deposits...........................          -- 
                                                       ---------- 
                                                               -- 
                                                       ---------- 

SHAREHOLDER'S EQUITY                                              
  Common stock, $.01 par value, 100 shares                        
    authorized, issued and outstanding...............           1 
  Additional paid-in capital.........................          -- 
  Accumulated deficit................................          (1)
                                                               -- 
                                                       ---------- 
                                                       $       -- 
                                                       ========== 

See notes to consolidated financial statements

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BCMR SEATTLE, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

For the period from January 1, 2003 through May 15, 2003 (cessation)

                                                                [Download Table]

                                                     (Restated)   
                                                  ----------------
                                                                  
TOTAL REVENUE...................................     $2,772,105   
                                                     ----------   

OPERATING COSTS                                                   
  Property operating costs......................        888,129   
  General and administrative....................        101,312   
  Depreciation and amortization.................        497,664   
  Other expenses................................        119,557   
                                                     ----------   
                                                      1,606,662   
                                                     ----------   
OPERATING INCOME (LOSS).........................      1,165,443   
  Interest expense..............................     (1,027,897)  
                                                     ----------   
INCOME (LOSS) BEFORE INCOME TAXES...............        137,546   
  Benefit from (provision for) income taxes.....        (53,268)  
                                                     ----------   
NET INCOME (LOSS)...............................     $   84,278   
                                                     ==========   

See notes to consolidated financial statements

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BCMR SEATTLE, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN 
SHAREHOLDER'S EQUITY

For the period from January 1, 2003 through May 15, 2003 (cessation)

                                                        [Enlarge/Download Table]

                           Common Stock       Additional                             
                       ---------------------    paid-in     Accumulated              
                        Shares      Amount      Capital       Deficit       Total    
                       ---------------------  -----------   -----------  ----------- 
                                                                                     
Balance as of                                                                        
  December 31,                                                                       
  2002...............    100      $       1   $ 9,325,983    $(84,279)   $ 9,241,705 
Net income...........     --             --            --      84,278         84,278 
                         ---      ----------  -----------    --------    ----------- 
Return of capital....     --             --    (9,325,983)         --     (9,325,983)
                         ---      ----------  -----------    --------    ----------- 
Balance as of May 15,                                                                
  2003                                                                               
  (cessation)........    100      $       1   $        --    $     (1)   $        -- 
                         ===      ==========  ===========    ========    =========== 

See notes to consolidated financial statements

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BCMR SEATTLE, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

For the period from January 1, 2003 through May 15, 2003 (cessation)

                                                                [Download Table]

                                                              (Restated)  
                                                             ------------ 
                                                                          
Cash flows from operating activities.......................               
  Net income (loss)........................................  $     84,278 
  Adjustments to reconcile net income (loss) to net cash                  
    provided by (used in) operating activities                            
    Depreciation and amortization..........................       497,664 
    Gain on sale of net real estate assets.................      (157,354)
    Deferred taxes.........................................        53,268 
    (Increase) decrease in accounts receivable--tenants....            35 
    (Increase) decrease in prepaid expenses................      (164,949)
    (Increase) decrease in tenants' security                              
      deposits--asset......................................        15,805 
    (Increase) decrease in reserve account.................            -- 
    (Increase) decrease in real estate taxes and insurance                
      escrows..............................................        (9,328)
    (Increase) decrease in other assets....................      (483,835)
    Increase (decrease) in accounts payable and accrued                   
      expenses.............................................       272,262 
    Increase (decrease) in unearned rental revenue.........        (7,144)
    Increase (decrease) in tenants' security                              
      deposits--liability..................................       (13,846)
                                                             ------------ 
        Net cash provided by (used in) operating                          
          activities.......................................        86,856 
                                                             ------------ 
Cash flows from investing activities                                      
  (Increase) decrease in capital improvements escrow.......      (112,281)
  Proceeds from sale of net real estate assets.............     9,325,983 
  Real estate acquisition costs............................            -- 
                                                             ------------ 
        Net cash provided by (used in) investing                          
          activities.......................................     9,213,702 
                                                             ------------ 
  Cash flows from financing activities                                    
  Paid in capital..........................................            -- 
  Distributions............................................    (9,325,983)
  Financing fees paid......................................            -- 
                                                             ------------ 
        Net cash provided by (used in) financing                          
          activities.......................................    (9,325,983)
                                                             ------------ 
        NET INCREASE (DECREASE) IN CASH....................       (25,425)
Cash, beginning............................................        25,425 
Cash, end..................................................  $         -- 
                                                             ------------ 
  Interest paid............................................  $    913,735 
                                                             ------------ 
Non-cash investing and financing activities                               
  Acquisition of real estate through debt assumption.......  $         -- 
                                                             ------------ 
  Funding of capital improvements escrow through debt                     
    assumption.............................................  $         -- 
                                                             ------------ 
  Sale of net assets                                                      
  Real estate and other assets sold........................  $ 55,295,983 
  Debts assumed............................................   (45,970,000)
                                                             ------------ 
                                                             $  9,325,983 
                                                             ============ 

See notes to consolidated financial statements

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies                        

BCMR Seattle, Inc. (the Company), a Maryland corporation, was formed on         
November 1, 2002. The Company is a real estate Company engaged in the           
acquisition, ownership, management, and operation of market rate multifamily    
properties throughout the United States. The Company was capitalized by issuing 
100 shares of $.01 par value common stock with a price of $93,259.84 which      
resulted in initial proceeds of $9,235,984.                                     

On December 16, 2002, the Company acquired four properties (the "Communities")  
in Washington, consisting of 802 units.                                         

                                                                [Download Table]

                                                      Occupancy   
                                         Number         as of     
Property Name           City, State     of Units   April 30, 2003 
-------------          --------------   --------   ---------------
                                                                  
Alderwood Park                                                    
  Apartments.........  Lynwood, WA       188          86%         
Ridgegate                                                         
  Apartments.........  Kent, WA          153          96%         
Ridgetop                                                          
  Apartments.........  Silverdale, WA    221          95%         
Wellington                                                        
  Apartments.........  Silverdale, WA    240          95%         

The following is a history of the purchase and ownership of the Seattle         
Portfolio.                                                                      

(1) On July 11, 2002, Goodman Financial Services, Inc., an affiliate of GFS     
Equity Management LLC, (GFS) negotiated and entered into a purchase     
agreement for the Seattle communities from an unaffiliated Seller.      

(2) In December, 2002, affiliates of Boston Capital Real Advisors, LLC, the     
 Company's Advisor, agreed to acquire the Seattle communities from GFS for
 possible investment by a group of private investors. GFS agreed to assign
its entire interest in the Seattle community purchase contracts to      
    affiliates of Boston Capital Real Advisors, LLC in return for the payment of
   the $51,366,000 purchase price plus a subordinated economic interest in the
communities and the initial management contract for the communities.    

(3) BC-GFS LLC was formed as the entity that the purchase contracts were to be  
assigned. The owners of BC-GFS, LLC were BCMR Special, Inc. and BCMR    
Seattle, a Limited Partnership, both controlled by                      

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies (Continued)            
  the Company's affiliates. BCMR Seattle, a Limited Partnership, also had as
its partners entities controlled by the Company's affiliates.           

(4) On December 12, 2002, BCMR Seattle, Inc. contributed $9,325,984 to BCMR     
Seattle, a Limited Partnership, to purchase the Seattle Portfolio. On   
December 16, 2002, all four of the Seattle communities were purchased   
through four wholly-owned subsidiaries of BC-GFS LLC.                   

The general partner of BCMR Seattle, A Limited partnership, is BCMR, Inc., which
is an affiliate of the Company's Advisor. BCMR Special, Inc., which is an       
affiliate of the Company's Advisor, acts as investor manager of BC-GFS LLC for  
the purpose of exercising certain consent rights. Neither BCMR, Inc. or BCMR    
Special, Inc. can exercise any voting rights contrary to the Company's direction
or interests. Neither BCMR, Inc. or BCMR Special, Inc. will receive any         
compensation from operations as a result of their roles as owners of BCMR       
Seattle, A Limited Partnership or BC-GFS, LLC. This structure exists only for   
the Seattle communities and will not be used in any other acquisitions. The     
Company can remove BCMR, Inc. and BCMR Special, Inc. at any time without cause. 
The manager of BC-GFS LLC is GFS Equity Management LLC, a third party which is  
not affiliated with the Company or its Advisor.                                 

GFS Equity Management, LLC is entitled to participate in the cash distributions 
of the Seattle communities after the Company has received a priority share of   
the cash flow. Before GFS Equity Management LLC receives any portion of the cash
flow, the Company will receive:                                                 

(i) $50 annually per apartment unit and then                  

    (ii) a 12% preferred return on its unreturned capital contributions.

To the extent the Company receives this priority share of the cash flow, it will
be used to pay ordinary expenses, including operational-stage fees and          
reimbursement to its Advisor and affiliates. After payment of such expenses, the
priority cash flow would be available for distribution to stockholders. There is
no guarantee that there will be sufficient priority cash flow to make any       
distributions to stockholders.                                                  

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies (Continued)            
The Company will then share 50/50 with GFS Equity Management LLC in all         
remaining income from operations of the Seattle communities. Proceeds form the  
sale of any of the Seattle communities will first be distributed to pay any     
unpaid preferred return. Remaining sale proceeds will be distributed until the  
Company has received a return of its capital contributions (taking into account 
prior distributions) plus a 16% annum rate of return. The Company will then     
receive 75% and GFS Equity Management LLC will receive 25% of any remaining sale
proceeds. There is no guarantee that any preferred return will be sufficient for
the Company to make any distribution to stockholders. The Company believes that 
this arrangement is an appropriate incentive to encourage performance by GFS    
Equity Management LLC. The Company can remove GFS Equity Management LLC without 
cause at any time.                                                              

On May 15, 2003 BCMR Seattle, Inc. ceased operations and Boston Capital Real    
Estate Investment Trust, Inc., a related party, acquired all assets,            
liabilities, contracts, leases, rights, and titles previously held by the       
Company.                                                                        

A summary of significant accounting policies follows.                           

Basis of Accounting                                                             

The financial statements have been prepared using the accrual method of         
accounting. As such, revenue is recorded when earned and expenses are recognized
when incurred.                                                                  

In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 141, "Business Combinations."    
SFAS No. 141 requires that acquisitions be accounted for by the purchase method 
as well as other requirements. The Company accounts for real estate acquisitions
in accordance with SFAS No. 141. All in-place property-tenant leases are one    
year or less and are considered operating leases. Lease rental rates approximate
market rents; therefore, the purchase price is allocated to land and            
improvements and no contract-based intangible assets, liabilities, or           
commitments are recognized.                                                     

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies (Continued)            
Principles of Consolidation                                                     

The Company controls, through ownership and by agreement, BCMR Seattle, a       
Limited Partnership, which controls BC-GFS, LLC (an operating limited liability 
Company) whose wholly-owned subsidiaries own legal fee simple title to the      
communities, all of which are consolidated within the Company for financial     
reporting purposes. All intercompany accounts and transactions have been        
eliminated in consolidation.                                                    

Accounts Receivable                                                             

Tenant receivables are reported net of an allowance for doubtful accounts.      
Management's estimate of the allowance is based on historical collection        
experience and a review of the current status of tenant accounts receivable. It 
is reasonably possible that management's estimate of the allowance will change. 

Revenue Recognition                                                             

Tenant leases are classified as operating leases. Rental income attributable to 
leases is recorded when due from tenants and is recognized monthly as it is     
earned, which is not materially different than on a straight-line basis. Leases 
between a tenant and property for the rental of an apartment unit are generally 
year-to-year, renewable upon consent of both parties on an annual or monthly    
basis. Advanced receipts of rental income are deferred and classified as        
liabilities until earned. Interest income is recorded on an accrual basis.      

Real Estate                                                                     

Real Estate is carried at cost. Depreciation is computed under the straight-line
method using service lives of 7 years for personal property and 40 years for    
buildings and improvements.                                                     

In accordance with SFAS No. 144, "Accounting for the Impairment or Disposal of  
Long-Lived Assets," the Company periodically evaluates its long-lived assets,   
including its investments in real estate, for impairment                        

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies (Continued)            
indicators. The judgments regarding the existence of impairment indicators are  
based on factors such as operational performance, market conditions, expected   
holding period of each asset and legal and environmental concerns. Future events
could occur which would cause the Company to conclude that impairment indicators
exist and an impairment loss is warranted.                                      

For long-lived assets to be held and used, the Company compares the expected    
future undiscounted cash flows for the long-lived asset against the carrying    
amount of that asset. If the sum of the estimated undiscounted cash flows is    
less than the carrying amount of the asset, an impairment loss would be recorded
for the difference between the estimated fair value and the carrying amount of  
the asset.                                                                      

For long-lived assets to be disposed of, an impairment loss is recognized when  
the estimated fair value of the asset, less the estimated cost to sell, is less 
than the carrying amount of the asset measured at the time that the Company has 
determined it will sell the asset. Long-lived assets held for disposition and   
the related liabilities are separately reported at the lower of their carrying  
amounts or their estimated fair values, less their costs to sell, and are not   
depreciated after reclassification to real estate held for disposition.         

The Company has not recognized an impairment loss in the period from January 1, 
2003 through May 15, 2003 (cessation) on any of its communities.                

Amortization                                                                    

Financing costs are amortized over the term of the respective mortgage loans    
using the effective interest method.                                            

Income Taxes                                                                    

The Company accounts for income taxes in accordance with Statement of Financial 
Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes," which     
requires the recognition of deferred income taxes for differences between the   
basis of assets and liabilities for financial statement and                     

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies (Continued)            
income tax purposes. Deferred tax assets and liabilities represent the future   
tax consequence for those differences, which will either be taxable or          
deductible when the assets and liabilities are recovered or settled. Deferred   
taxes are also recognized for operating losses that are available to offset     
future taxable income. Valuation allowances are established when necessary to   
reduce deferred tax assets to the amount expected to be realized. Deferred tax  
assets and liabilities are measured using enacted tax rates in effect for the   
year in which those temporary differences are expected to be recovered or       
settled.                                                                        

Use of Estimates                                                                

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

Organization Costs                                                              

Organization costs are expensed in the period incurred.                         

Recent Accounting Pronouncements and Interpretations                            

In January 2003, the FASB issued Interpretation ("FIN") No. 46, "Consolidation  
of Variable Interest Entities." In December 2003, the FASB issued a revised     
Interpretation (FIN 46R), which replaces the original FIN 46. FIN 46R clarifies 
existing accounting for whether interest entities should be consolidated in     
financial statements based upon the investee's ability to finance its activities
without additional financial support and whether investors possess              
characteristics of a controlling financial interest. FIN No. 46R requires a     
variable interest entity to be consolidated by a Company if that Company is     
subject to a majority of the risk of expected losses from the variable interest 
entity's activities or entitled to receive a                                    

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies (Continued)            
majority of the entity's residual returns or both. The consolidation            
requirements of FIN No. 46R apply immediately to variable interest entities     
created after December 31, 2003 and apply to older entitles in the first annual 
period beginning after December 15, 2004. The Company controls the underlying   
real estate entitles and already presents its financial statements on a         
consolidated basis; therefore, adoption of FIN No. 46R is not expected to have a
material effect on the consolidated financial position or consolidated results  
of operations.                                                                  

In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements     
No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical             
Corrections." SFAS No. 145, among other items, rescinds the automatic           
classification of costs incurred on debt extinguishment as extraordinary        
charges. Instead, gains and losses from debt extinguishment should only be      
classified as extraordinary if they meet the unusual and infrequently occurring 
criteria outlined in APB No. 30. SFAS No. 145 is effective for fiscal years     
beginning after May 15, 2002. The Company adopted the standard effective        
January 1, 2003.                                                                

In June 2002, the FASB issued SFAS No. 146, "Accounting, for Costs Associated   
with Exit or Disposal Activities," which addresses accounting and processing for
costs associated with exit or disposal activities. SFAS No. 146 requires the    
recognition of a liability for a cost associated with an exit or disposal       
activity when the liability is incurred versus the date the Company commits to  
an exit plan. In addition, SFAS No. 146 states that the liability should be     
initially measured at fair value. The requirements of SFAS No. 146 are effective
for exit or disposal activities that are initiated after December 31, 2002. This
pronouncement is not expected to have a material impact on the Company's        
financial position or results of operations.                                    

The FASB has issued SFAS No. 147, "Acquisitions of Certain Financial            
Institutions," which is effective for certain transactions arising on or after  
October 1, 2002. SFAS No. 147 will have no impact on the Company.               

The FASB has issued SFAS No. 148, "Accounting for Stock-Based                   
Compensation--Transition and Disclosure." SFAS No. 148 amends SFAS No. 123,     

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note A--Organization and Significant Accounting Policies (Continued)            
"Accounting for Stock-Based Compensation," to provide alternative methods of    
transition for a voluntary change to the fair value based method of accounting  
for stock-based employee compensation. In addition, SFAS No. 148 amends the     
disclosure requirements of SFAS No. 123 to require prominent disclosures in both
annual and interim financial statements about the method of accounting for      
stock-based employee compensation and the effect of the method used on reported 
results. The Company does not currently have stock-based employee compensation. 

FASB Interpretation No. 45 ("FIN 45"), "Guarantor's Accounting and Disclosure   
Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of   
Others--an interpretation of FASB Statements No. 5, 57 and 107 and rescission of
FASB Interpretation No. 34," was issued in November 2002. FIN 45 elaborates on  
the disclosures to be made by a guarantor in its interim and annual financial   
statements about its obligations under certain guarantees that it has issued. It
also clarifies that a guarantor is required to recognized, at the inception of a
guarantee, a liability for the fair value of the obligation undertaken in issued
the guarantee. FIN 45 does not prescribe a specific approach for subsequently   
measuring the guarantor's recognized liability over the term of the related     
guarantee. The initial recognition and initial measurement provisions of FIN 45 
are applicable on a prospective basis to guarantees issued or modified after    
December 31, 2002, irrespective of he guarantor's fiscal year end. The          
disclosure requirements in FIN 45 are effective for financial statements of     
interim or annual periods ending after December 15, 2002. The Company has made  
the disclosures required by FIN 45.                                             

Note B--Restatement                                                             

In 2005, we concluded that interest expense related to certain mortgages on our 
properties for the month of May should have been accrued in our consolidated    
financial statements. Accordingly the statement of operations has been restated 
to give effect of this correction. As a result of the adjustment, interest      
expense and gain on sale of an asset, which is included in total revenue, have  
increased by $114,162. There was no effect on net income.                       

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note B--Restatement (Continued)                                                 
The following table sets forth the previously reported and restated amounts     
within our consolidated statement of operations for the period January 1, 2003  
through May 15, 2003 (cessation).                                               

                                                                [Download Table]

                                  Amount as                         
                                  Originally   Amount as            
                                   Reported     Restated     Change 
                                  ----------   ----------   --------
                                                                    
STATEMENT OF OPERATIONS                                             
Total Revenue...................  $2,657,943   $2,772,105   $114,162
Interest Expense................  $  913,735   $1,027,897   $114,162

Note C--Notes Payable                                                           

                                                                [Download Table]

                                                           As of    
                                                       May 15, 2003 
                                                       -------------
                                                                    
Note payable to Berkshire Mortgage Finance Limited                  
Partnership. The note bears interest at 4.67% and                   
matures on January 1, 2008. Monthly interest only                   
payments of $147,300 are required beginning February                
1, 2003. The note is secured by a first mortgage on                 
the Communities and an interest in BC GFS, LLC.......    $       -- 

Note payable to Berkshire/WAFRA Mezzanine Debt                      
Investors Foreign Fund. The note bears interest at                  
12% and matures on December 31, 2007. Monthly                       
principal and interest payments of $86,084 are                      
required beginning February 1, 2003 with a balloon                  
payment due at maturity. Amortization is calculated                 
based on a 25-year term. Upon maturity, the Company                 
can either make a balloon payment for an unpaid                     
principal or convert the note to a fixed or floating                
interest rate term loan. The note is secured by a                   
second mortgage on the Communities and interest in                  
the BC GFS, LLC......................................    $       -- 
                                                         ---------- 

                                                         $       -- 
                                                         ========== 

As of May 15, 2003, the Company had no notes payable.                           

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BCMR SEATTLE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 15, 2003

Note D--Related Party Transactions                                              

During the period from January 1, 2003 through May 15, 2003, property management
fees of $82,918 were paid to an affiliate of BC GFS, LLC.                       

On May 15, 2003, Boston Capital Real Estate Investment Trust, Inc. acquired all 
assets, liabilities, contracts, leases, rights, and titles previously held by   
BCMR Seattle, Inc., which ceased operations. Boston Capital Real Estate         
Investment Trust, Inc. executed a note payable of $9,325,983 payable to BCP     
Funding, LLC, a related party, in order to complete this transaction. BCMR      
Seattle, Inc. recognized a gain of $157,354 upon the sale and returned all      
capital to its shareholder. The gain is included in total revenue on the        
consolidated statements of operations.                                          

Note E--Income Taxes                                                            

The components of income tax expense for the period January 1, 2003 through     
May 15, 2003 (cessation) are as follows:                                        

                                                                [Download Table]

                                             2003  
                                           --------
                                                   
Current..................................  $    -- 

Deferred.................................  $53,268 
                                           ------- 

                                           $53,268 
                                           ======= 

A deferred tax asset of $53,268 was established at December 31, 2002 based on   
the net operating loss available to be carried forward, at a federal tax rate of
34% and a state tax rate of 7%. The deferred tax asset was fully used in 2003.  

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PRO FORMA STATEMENTS

The following unaudited pro forma statements set forth summary consolidated     
operating information of the Company for the year ended December 31, 2005.      

The pro forma statements are intended to present the Company's balance sheet and
statement of operations for the year ended December 31, 2005 based on the       
Company completing an offering of at least $29.5 million which is the minimum   
offering required to retain the Jacksonville communities. Other adjustments     
contemplated by the completion of the $29.5 million offering are: retention of  
only the Jacksonville communities, and repayment of the associated line of      
credit. The pro forma statements assume that the acquisition of the Jacksonville
communities occurred on January 1, 2005 and that the net proceeds from the      
Company's offering were applied in accordance with the "Use of Proceeds" as     
included elsewhere in this prospectus.                                          

The combined historical information of the Company includes financial           
information for communities that will not be retained should the Company        
complete an offering of less than $29.5 million. The Company has acquired four  
communities, namely, the Seattle, Portland, Jacksonville, and Plano communities.
Should an offering of only $29.5 million be achieved, the Seattle, Portland, and
Plano communities will be removed from the Company and the Jacksonville         
communities will be the sole asset of the Company.                              

The balance sheet pro forma has two adjustments which impact numerous accounts. 
The first is the removal of the assets, liabilities and shareholder's equity for
the Seattle, Portland, and Plano communities. The second adjustment is to       
account for the effect on the balance sheet as it relates to the completion of  
the $29.5 million offering required to retain the Jacksonville communities.     
Included in this adjustment is the payment of all borrowings under the line of  
credit from affiliates, advances from affiliates which have funded all cash     
needs to date, the payment of all organizational and offering expenses, and the 
establishment of a working capital reserve and shareholder's equity.            

The pro forma adjustments for the consolidated statement of operations reflect  
the removal of revenues and expenses for the Seattle, Portland, and Plano       
communities along with any associated costs.                                    

The pro forma statements should be read in conjunction with the historical      
information that was used in the preparation of the pro forma statements. It    
should not be assumed that the historical results can be achieved in future     
years, nor are they necessarily indicative of that which would have been        
attained had the transaction occurred at an earlier date.                       

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Boston Capital Real Estate Investment Trust, Inc. 
Consolidated Balance Sheet as of December 31, 2005
(Dollars in Thousands Except Per Share Amounts) 
Unaudited 

                                                        [Enlarge/Download Table]

                                                           Seattle       Portland       Plano                    
                                                          Pro Forma     Pro Forma     Pro Forma     Pro Forma    
                                        Historical       Adjustments   Adjustments   Adjustments   Adjustments   
                                     December 31, 2005       (A)           (B)           (C)           (D)       
                                    -------------------  ------------  ------------  ------------  ------------  
                                                                                                                 
ASSETS                                                                                                           
REAL ESTATE                                                                                                      
  Land.............................      $ 31,084          $ (8,814)     $ (9,525)     $ (2,050)     $     --    
  Buildings and improvements.......       147,478           (44,567)      (48,910)      (12,535)          400 (1)
  Personal property................         8,290              (893)         (255)       (1,000)           --    
  Construction in progress.........            --                --            --            --            --    
                                         --------          --------      --------      --------      --------    
                                          186,852           (54,274)      (58,690)      (15,585)          400    
  Less accumulated depreciation....        13,140            (3,838)       (3,281)         (125)           --    
                                         --------          --------      --------      --------      --------    
                                          173,712           (50,436)      (55,409)      (15,460)          400    
OTHER ASSETS                                                                                                     
  Cash and cash equivalents........         1,629              (448)         (509)          (77)          658 (2)
  Accounts receivable--tenants.....           156               (23)          (49)          (12)           --    
  Restricted cash..................         2,889              (436)         (383)       (1,665)           --    
  Deferred financing costs, net of                                                                               
    accumulated amortization.......         1,240              (286)         (386)         (163)           --    
  Other Assets.....................         4,027               309           195          (168)       (2,885)(3)
                                         --------          --------      --------      --------      --------    
                                         $183,653          $(51,938)     $(56,931)     $(17,545)     $ (1,827)   
                                         ========          ========      ========      ========      ========    
LIABILITIES AND SHAREHOLDER'S                                                                                    
  EQUITY                                                                                                         
Line of credit--affiliate..........      $ 56,597          $ (9,326)     $(22,317)     $     --      $(24,954)(4)
Interest payable on line of                                                                                      
  credit...........................           366               (41)         (155)           --          (170)(5)
Mortgage notes payable.............       132,525           (45,837)      (39,333)      (11,981)           --    
Other note payable.................         5,556                --            --        (5,556)           --    
Accounts payable and accrued                                                                                     
  expenses.........................         3,260              (389)         (233)          (87)         (590)(6)
Due to related party...............         4,944              (226)         (241)           --            --    
Other liabilities..................           846              (163)         (356)          (46)           --    
                                         --------          --------      --------      --------      --------    
                                          204,094           (55,982)      (62,635)      (17,670)      (25,714)   
                                         --------          --------      --------      --------      --------    
MINORITY INTEREST..................           167                --            --          (167)           --    
                                         --------          --------      --------      --------      --------    
SHAREHOLDER'S EQUITY                                                                                             
  Common stock, $.001 par value,                                                                                 
    20,000 shares authorized,                                                                                    
    issued, and outstanding........            --                --            --            --            30 (7)
  Additional paid-in capital.......           200                --            --            --        23,857 (8)
  Accumulated deficit..............       (20,808)            4,044         5,704           292            --    
                                         --------          --------      --------      --------      --------    
                                          (20,608)            4,044         5,704           292        23,887    
                                         --------          --------      --------      --------      --------    
                                         $183,653          $(51,938)     $(56,931)     $(17,545)     $ (1,827)   
                                         ========          ========      ========      ========      ========    



                                         Pro Forma                                                               
                                     December 31, 2005                                                           
                                    -------------------                                                          
                                                                                                                 
ASSETS                                                                                                           
REAL ESTATE                                                                                                      
  Land.............................      $ 10,695                                                                
  Buildings and improvements.......        41,866                                                                
  Personal property................         6,142                                                                
  Construction in progress.........            --                                                                
                                         --------                                                                
                                           58,703                                                                
  Less accumulated depreciation....         5,896                                                                
                                         --------                                                                
                                           52,807                                                                
OTHER ASSETS                                                                                                     
  Cash and cash equivalents........         1,253                                                                
  Accounts receivable--tenants.....            72                                                                
  Restricted cash..................           408                                                                
  Deferred financing costs, net of                                                                               
    accumulated amortization.......           405                                                                
  Other Assets.....................           470                                                                
                                         --------                                                                
                                         $ 55,412                                                                
                                         ========                                                                
LIABILITIES AND SHAREHOLDER'S                                                                                    
  EQUITY                                                                                                         
Line of credit--affiliate..........      $     --                                                                
Interest payable on line of                                                                                      
  credit...........................            --                                                                
Mortgage notes payable.............        35,374                                                                
Other note payable.................            --                                                                
Accounts payable and accrued                                                                                     
  expenses.........................         1,961                                                                
Due to related party...............         4,477                                                                
Other liabilities..................           281                                                                
                                         --------                                                                
                                           42,093                                                                
                                         --------                                                                
MINORITY INTEREST..................            --                                                                
                                         --------                                                                
SHAREHOLDER'S EQUITY                                                                                             
  Common stock, $.001 par value,                                                                                 
    20,000 shares authorized,                                                                                    
    issued, and outstanding........            30                                                                
  Additional paid-in capital.......        24,057                                                                
  Accumulated deficit..............       (10,768)                                                               
                                         --------                                                                
                                           13,319                                                                
                                         --------                                                                
                                         $ 55,412                                                                
                                         ========                                                                

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The column in the consolidated balance sheet entitled, "Historical December 31, 
2005" represents the balance sheet of the Company, which includes the Seattle,  
Portland, Jacksonville, and Plano communities. The column on the consolidated   
balance sheet entitled, "Pro Forma December 31, 2005," represents the balance   
sheet of the Company, which includes the Jacksonville communities assuming that 
the minimum offering required to retain the Jacksonville communities has been   
completed.                                                                      

Pro forma Adjustments A for the Balance Sheet as of December 31, 2005 represents
the removal all assets, liabilities and shareholder's equity for the Seattle    
communities. The removal of these assets will occur should the Company complete 
an offering of only $29.5 million.                                              

Pro forma Adjustments B for the Balance Sheet as of December 31, 2005 represents
the removal all assets, liabilities and shareholder's equity for the Portland   
communities. The removal of these assets will occur should the Company complete 
an offering of only $29.5 million                                               

Pro forma Adjustments C for the Balance Sheet as of December 31, 2005 represents
the removal all assets, liabilities and shareholder's equity for the Plano      
community. The removal of these assets will occur should the Company complete an
offering of only $29.5 million                                                  

Pro forma Adjustments D for the Balance Sheet as of December 31, 2005 represents
the application of the $29.5 million offering proceeds. Below are explanations  
by item number:                                                                 

1.  Upon completion of the $29.5 million offering required to retain the
  Jacksonville communities the Company is required to pay an affiliate
     Acquisition Fees and Acquisition expenses in the amount of 2.7% and .5%
respectively. The Company has already prepaid a portion of the    
       Acquisition fee and expenses in the amount of $471, and $74 respectively.
       After a reduction for the prepaid amounts, remaining Acquisition fees and
    expenses in the amounts of $326 and $74 respectively will be paid. The
Acquisition fee and expenses have been included in Buildings and  
      improvements and is amortized over the same useful life as the Buildings
and improvements.                                                 

   2.  From the Offering Proceeds the Company will establish a Working Capital
Reserve of 1% which will be available for investments in property,
      contingencies and other uses as defined elsewhere in this prospectus. An
    additional adjustment to the Working Capital Reserve is an addition to
the Reserve for excess offering proceeds in the amount of $533.   
     Additionally, upon completion of the $29.5 million offering required to
   retain the Jacksonville communities the Company is required to pay an
    affiliate all accrued interest on the affiliated line of credit. As of
       December 31, 2005 outstanding interest under this line of credit is $170.

3.  Upon completion of the $29.5 million offering required to retain the
       Jacksonville communities the Company will reclass deferred offering costs
from other assets to offering costs.                              

4.  The Company has borrowed from an affiliate under a line of credit to
   make its equity contribution in the communities. For the Jacksonville
communities $24,954 has been borrowed and will be repaid upon the 
completion of the $29.5 million offering.                         

5.  The Company has borrowed from an affiliate to make its equity       
      contribution in the communities. In addition to paying off the principal
      of the Jacksonville communities, the Company will be required to pay off
all outstanding interest upon the completion of the $29.5 million 
offering.                                                         

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 6.  An affiliate of the Company made non-interest bearing advances to the
  Company for all monies necessary to organize the entity, acquire its
assets, and work its way through the necessary regulatory approval
   processes. This item represents repayment of those advances by way of
    paying a 2% reimbursement for Organizational expenses in the amount of
$590.                                                             

  7.  The offering amount required to retain the Jacksonville communities is
    $29.5 million. With the par value of the common stock being $.001, $30
represents the par value of the common stock.                     

  8.  The offering amount required to retain the Jacksonville communities is
      $29.5 million. With the offering price of the common stock being $10.00,
  $29,970 represents additional paid-in capital. The number is further
     reduced by commissions of 7% ($2,065), Dealer-Manager Fee of 2% ($590),
    Offering expenses of .25% ($74) and Deferred Offering costs of $2,885.

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Boston Capital Real Estate Investment Trust, Inc. 
Consolidated Statement of Operations
(Dollars in Thousands Except Per Share Amounts) 
(Unaudited) 

                                                        [Enlarge/Download Table]

                                                     Historical                                                     
                                                   For the period        Seattle         Portland         Plano     
                                                   January 1, 2005      Pro Forma       Pro Forma       Pro Forma   
                                                       through         Adjustments     Adjustments     Adjustments  
                                                  December 31, 2005        (A)             (B)             (C)      
                                                 -------------------   ------------    ------------    ------------ 
                                                                                                                    
TOTAL RENTAL AND OTHER REVENUE..................      $ 24,061           $(8,091) (1)    $(7,596) (1)     $(561) (1)
                                                      --------           -------         -------          -----     

OPERATING COSTS                                                                                                     
  Property operating costs......................         7,850            (2,266) (2)     (2,487) (2)      (208) (2)
  General and administrative....................         3,164              (667) (3)       (821) (3)       (70) (3)
  Depreciation and amortization.................         6,096            (1,446) (4)     (1,418) (4)      (263) (4)
  Portfolio and management fees--related                                                                            
    parties.....................................         1,368              (415) (5)       (462) (5)       (38) (5)
  Asset management fee--related party...........         1,182              (587) (6)       (308) (6)       (19) (6)
                                                      --------           -------         -------          -----     
                                                        19,660            (5,381)         (5,496)          (598)    
                                                      --------           -------         -------          -----     

    OPERATING INCOME............................         4,401            (2,710)         (2,100)            37     
                                                      --------           -------         -------          -----     

INTEREST (INCOME) EXPENSE                                                                                           
  Interest expense on line of                                                                                       
    credit--affiliate...........................         5,377              (886) (7)     (2,120) (7)        --     
  Interest expense--other.......................         6,336            (2,742) (8)     (1,778) (8)      (299) (7)
  Interest income...............................           (15)               --              --             --     
                                                      --------           -------         -------          -----     
                                                        11,698            (3,628)         (3,898)          (299)    
                                                      --------           -------         -------          -----     
Net Income/(Loss) Minority Interest.............            (6)               --              --              6     
Net Income (Loss)...............................      $ (7,291)          $   918         $ 1,798          $ 330     
                                                      ========           =======         =======          =====     
Loss per share..................................      $(365.00)                                                     
                                                      ========                                                      
Pro forma weighted average common shares                                                                            
  outstanding (shares in thousands).............            20                                                      
                                                      ========                                                      


                                                                     Pro Forma                                      
                                                                  For the period                                    
                                                  Pro Forma       January 1, 2005                                   
                                                 Adjustments          through                                       
                                                     (D)         December 31, 2005                                  
                                                 ------------   -------------------                                 
                                                                                                                    
TOTAL RENTAL AND OTHER REVENUE..................    $   --            $ 7,813                                       
                                                    ------            -------                                       
OPERATING COSTS                                                                                                     
  Property operating costs......................        --              2,889                                       
  General and administrative....................        --              1,606                                       
  Depreciation and amortization.................        --              2,969                                       
  Portfolio and management fees--related                                                                            
    parties.....................................        --                453                                       
  Asset management fee--related party...........        --                268                                       
                                                    ------            -------                                       
                                                        --              8,185                                       
                                                    ------            -------                                       
    OPERATING INCOME............................        --               (372)                                      
                                                    ------            -------                                       
INTEREST (INCOME) EXPENSE                                                                                           
  Interest expense on line of                                                                                       
    credit--affiliate...........................    (2,371)                --                                       
  Interest expense--other.......................        --              1,517                                       
  Interest income...............................        --                (15)                                      
                                                    ------            -------                                       
                                                    (2,371)             1,502                                       
                                                    ------            -------                                       
Net Income/(Loss) Minority Interest.............        --                 --                                       
Net Income (Loss)...............................    $2,371            $(1,874)                                      
                                                    ======            =======                                       
Loss per share..................................                      $ (0.63)                                      
                                                                      =======                                       
Pro forma weighted average common shares                                                                            
  outstanding (shares in thousands).............                        2,970                                       
                                                                      =======                                       

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Pro forma Adjustments A for the Statement of Operations are for the year ended  
December 31, 2005 and represent removal of all operations for the Seattle       
communities which would result if only the offering of $29.5 million is achieved
and elimination of all costs associated with the line of credit from an         
affiliate pertaining to Seattle. Below are explanations by item number:         

    1.  The Revenue has been reduced by $8,091 for the removal of income related
to the Seattle communities.                                       

    2.  The Property operating cost line item has been reduced by $2,266 for the
     removal of property operating costs related to the Seattle communities.

  3.  The General and Administrative cost line item has been reduced by $667
for the removal of costs related to the Seattle communities.      

  4.  The Depreciation and amortization line item has been reduced by $1,466
     for the removal of depreciation and amortization related to the Seattle
communities.                                                      

  5.  The Portfolio management fee--related party line item has been reduced
by $415 for the removal of portfolio management fee--related party
expenses related to the Seattle communities.                      

  6.  The Asset Management Fees--related party line has been reduced by $587
for the removal of management fees--related party for the Seattle 
communities.                                                      

    7.  Under the assumption that no monies are to be received subsequent to the
   completion of the offering of $29.5 million and that consequently the
    Seattle communities would be removed from the Company, we have made an
adjustment related to interest expense for the communities. The   
     adjustment which removes all interest expense pertaining to the Seattle
borrowings under the line of credit from the affiliate is $886.   

    8.  Under the assumption that no additional monies are to be received beyond
    the completion of the $29.5 million offering and that consequently the
     Seattle communities would be removed from the Company, we have made the
  adjustment to remove $2,742 for all mortgage interest related to the
      Seattle communities. This includes interest on the primary mortgages and
the mezzanine debt.                                               

Pro forma Adjustments B are for the year ended December 31, 2005 and represent  
removal of all operations for the Portland communities which would result if    
only the $29.5 million offering is achieved and the elimination of all costs    
associated with the line of credit from an affiliate pertaining to Portland.    
Below are explanations by item number:                                          

    1.  The Revenue has been reduced by $7,596 for the removal of income related
to the Portland communities.                                      

    2.  The Property operating cost line item has been reduced by $2,487 for the
      removal of property operating costs related to the Portland communities.

  3.  The General and Administrative cost line item has been reduced by $821
for the removal of costs related to the Portland communities.     

  4.  The Depreciation and amortization line item has been reduced by $1,418
      for the removal of depreciation and amortization related to the Portland
communities.                                                      

  5.  The Portfolio management fee--related party line item has been reduced
by $462 for the removal of portfolio management fee--related party
expenses related to the Portland communities.                     

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 6.  The Asset Management Fee--related party line has been reduced by $308
for the removal of management fees--related party for the Portland
communities.                                                      

    7.  Under the assumption that no monies are to be received subsequent to the
   completion of the offering of $29.5 million and that consequently the
     Portland communities would be removed from the Company, we have made an
adjustment related to interest expense for the communities. The   
      adjustment which removes all interest expense pertaining to the Portland
borrowings under the line of credit from the affiliate is $886.   

    8.  Under the assumption that no additional monies are to be received beyond
       the completion of the offering of $29.5 million and that consequently the
      Portland communities would be removed from the Company, we have made the
  adjustment to remove $2,742 for all mortgage interest related to the
Portland communities.                                             

Pro forma Adjustments C for the Statement of Operations are for the year ended  
December 31, 2005 and represent removal of all operations for the Plano         
community which would result if only the offering of $29.5 million is achieved  
and elimination of all costs associated with the line of credit from an         
affiliate pertaining to Seattle. Below are explanations by item number:         

  1.  The Revenue has been reduced by $561 for the removal of income related
to the Plano Community.                                           

  2.  The Property operating cost line item has been reduced by $208 for the
 removal of property operating costs related to the Plano Community.

 3.  The General and Administrative cost line item has been reduced by $70
for the removal of costs related to the Plano Community.          

    4.  The Depreciation and amortization line item has been reduced by $263 for
the removal of depreciation and amortization related to the Plano 
Community.                                                        

5.  The Portfolio and asset management fees--related party line item has
      been reduced by $38 for the removal of portfolio management fee--related
party expenses related to the Plano Community.                    

    6.  The Asset Management Fee--related party line has been reduced by $19 for
    the removal of management fees--related party for the Plano Community.

    7.  Under the assumption that no monies are to be received subsequent to the
   completion of the offering of $29.5 million and that consequently the
Plano Community would be removed from the Company, we have made an
adjustment related to interest expense for the communities. The   
   adjustment which removes all interest expense pertaining to the Plano
borrowings is $299.                                               

Pro forma Adjustments D is for the year ended December 31, 2005 and it          
represents the removal of all affiliated interest in the amount of $2,371       
related to the Jacksonville communities.                                        

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                                                                      APPENDIX I

TABULAR INFORMATION CONCERNING
PRIOR LIMITED PARTNERSHIPS

The information contained in the following Tables I, II, III, and III-A is      
presented in conjunction with and as a supplement to the narrative summary      
appearing elsewhere in this prospectus under "Prior Performance of Affiliates of
Management" and is qualified in its entirety by the information contained in    
such narrative summary.                                                         

These Tables include information for the three-year period beginning January 1, 
2002, and ending December 31, 2004 (five-year period ending December 31, 2004   
for Table III) relating to public and private programs in the aggregate         
sponsored our affiliates which did not have similar investment objectives to    
those of the Company. Our affiliates have not sponsored prior programs, public  
or non-public, with investment objectives similar to those of the Company. The  
programs described in these tables are programs receiving Government Assistance 
and originally intended to provide, generally (1) tax benefits in the form of   
tax losses and low-income housing and rehabilitation tax credits which could be 
used by limited partners to offset income from other sources, (2) long-term     
capital appreciation through increases in the value of the programs'            
investments, (3) cash distributions from the sale or refinancing of the         
apartment complexes owned by the operating partnerships, and (4) in some        
instances, limited cash distributions from operations.                          

The programs listed in these Tables were organized our affiliates generally in a
two-tier structure. These two-tier programs consist of one investment limited   
partnership (the "investment partnership") which invested in a number of limited
partnerships (the "operating partnerships"), each of which owns an apartment    
complex for low- and moderate-income persons, which receives Government         
Assistance. Any market rate communities included in these programs were neither 
evaluated nor acquired in connection with programs that have investment         
objectives similar to ours. In the three-year period ending December 31, 2004,  
our affiliates sponsored two public partnerships and seventeen private          
partnerships. The following table identifies the number of operating partnership
interests acquired in programs sponsored by our affiliates as of December 31,   
2004:                                                                           

                                                        [Enlarge/Download Table]

                              % Equity    # of Operating                 Average Equity
                             Committed     Partnerships                  Per Operating 
          Program             12/31/04       Acquired      # of States    Partnership  
---------------------------------------------------------------------------------------
                                                                                       
Boston Capital Tax                                                                     
  Credit Fund IV L.P.:                                                                 
  Series 42................     97.7%           22              14         $1,213,512  
  Series 43................     98.4%           22               9         $1,561,367  
  Series 44................     79.2%            8               8         $2,651,997  
  Series 45................     80.6%           26              14         $1,229,254  
  Series 46................     75.8%           12               8         $1,864,049  
Boston Capital Tax                                                                     
  Credit Fund V L.P.                                                                   
  Series 47................     99.9%           13               7         $2,664,812  
  Series 48................     98.9%           11               7         $2,063,502  
  Series 49................     N/A*             4               4         $1,971,597  

*   Series 49 had not completed its offering as of 12/31/04.                    

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                                                        [Enlarge/Download Table]

                              % Equity    # of Operating                 Average Equity
                             Committed     Partnerships                  Per Operating 
          Program             12/31/04       Acquired      # of States    Partnership  
---------------------------------------------------------------------------------------
                                                                                       
Boston Capital Corporate                                                               
  Tax Credit Fund XVIII, A                                                             
  Limited Partnership......    100.0%           35              19         $2,811,487  
Boston Capital 2002 Direct                                                             
  Placements Limited                                                                   
  Partnerships.............    100.0%           24              15         $4,404,875  
Boston Capital Corporate                                                               
  Tax Credit Fund XIX, A                                                               
  Limited Partnership......    100.0%           17               9         $4,247,978  
Boston Capital 2003 Direct                                                             
  Placements Limited                                                                   
  Partnerships.............    100.0%           13               7         $2,923,374  
Boston Capital Corporate                                                               
  Tax Credit Fund XX, A                                                                
  Limited Partnership......     99.3%            7               4         $4,100,998  
Boston Capital Corporate                                                               
  Tax Credit Fund XX-A, A                                                              
  Limited Partnership......     88.2%           11               8         $4,079,421  
Boston Capital Corporate                                                               
  Tax Credit Fund XXI, A                                                               
  Limited Partnership......    100.0%           26              14         $5,112,651  
Boston Capital Corporate                                                               
  Tax Credit Fund XXII, A                                                              
  Limited Partnership......     53.8%           13              10         $3,842,481  
Boston Capital 2004 Direct                                                             
  Placement Limited                                                                    
  Partnerships.............     98.6%            2               7         $3,672,390  

In 1993, our affiliates formed Boston Capital Tax Credit Fund IV L.P., which was
registered under the Securities Act of 1933.                                    

In 2003, our affiliates formed Boston Capital Tax Credit Fund V L.P., which was 
registered under the Securities Act of 1933.                                    

For presentation purposes, private Direct Placement Limited Partnerships are    
grouped by year. The 2002, 2003 and 2004 Direct Placement Limited Partnerships  
contain 4, 5 and 2 partnerships respectively.                                   

The primary investment objectives of these limited partnerships are the         
preservation of the partnership's capital and the provision of current tax      
benefits to investors in the form of tax credits and passive losses. Cash flow  
distributions from the operating partnerships to the investment partnerships    
were not an investment objective in these programs. The regulations of          
government subsidy programs limit the amount of rent which may be charged to    
tenants and also limit the amount of cash flow which may be distributed, even if
greater amounts of cash flow are available.                                     

Investors in the Company will not have any interest in any of the prior limited 
partnerships incorporated in the tables or in any of the apartment complexes    
owned by these limited partnerships.                                            

The Tabular Information Concerning Prior Limited Partnerships and accompanying  
Notes are not covered by reports of independent certified public accountants.   

Additional information regarding prior public programs can be obtained upon     
written request to:                                                             

Boston Capital Corporation                                                      
One Boston Place, Suite 2100                                                    
Boston, Massachusetts 02108-4406                                                
Attn: Richard DeAgazio                                                          

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TABLE I 
EXPERIENCE IN RAISING AND INVESTING FUNDS 
(ON A PERCENTAGE BASIS) 

Table I includes information concerning the experience of our affiliates in     
raising and investing funds for public and private limited partnerships not     
having similar investment objectives to the Company. Information is included for
the two public offerings organized between January 1, 2002 and December 31,     
2004, which invested in 118 operating partnerships. Information is also included
for the 17 private offerings organized between January 1, 2002 and December 31, 
2004, which invested in 148 operating partnerships. For presentation purposes,  
private Direct Placement Limited Partnerships are grouped by year. The 2002,    
2003 and 2004 Direct Placement Limited Partnerships contain 4, 5 and 2          
partnerships, respectively. Table I presents the dollar amount offered and      
raised, the percentage of the amount raised which was used to pay offering costs
and acquire investments, the percentage of leverage used and the time frame for 
raising and investing funds.                                                    

Table I is presented as if all capital contributions were received and all      
expenses and payments of capital were paid in the year in which the offering    
closed, although such transactions occur over several years.                    

The Table should be read in conjunction with the introduction and accompanying  
Notes.                                                                          

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TABLE I                                                                         

EXPERIENCE IN RAISING AND INVESTING FUNDS 
(ON A PERCENTAGE BASIS) 
January 1, 2002 through December 31, 2004 

                                                        [Enlarge/Download Table]

                                                                  Public Offerings        
                                                            ----------------------------- 
                                                              BCTC IV           BCTC IV   
                                                               L.P.              L.P.     
                                                            (Series 42)       (Series 43) 
                                                               2002              2002     
                                                            -----------       ----------- 
                                                                                          
Dollar amount offered (1).................................. $27,442,620       $36,379,870 
Dollar amount raised (100%)................................         100%              100%
Less: Offering expenses                                                                   
Selling commissions and reimbursements retained by                                        
  affiliates (2)...........................................        1.88%             1.37%
Selling commissions and reimbursements to nonaffiliates                                   
  (3)......................................................        8.12%             8.63%
  Legal and organizational.................................        2.54%             1.62%
                                                            -----------       ----------- 
Total offering expenses....................................       12.54%            11.62%
                                                            ===========       =========== 
Working capital reserves...................................        0.66%             1.85%
Amount available for investment from limited partners......       87.46%            88.38%
Acquisition fees (4).......................................        8.50%             8.50%
Acquisition expenses (5)...................................        2.83%             2.51%
Cash payments to operating partnerships (6)................       73.75%            74.33%
                                                            -----------       ----------- 
Total acquisition costs....................................       85.74%            87.19%
                                                            ===========       =========== 
Mortgage financing......................................... $27,222,751       $32,705,400 
Additional capital (7)..................................... $ 1,637,166       $ 2,611,200 
                                                            -----------       ----------- 
Total other sources........................................ $28,859,917       $35,316,600 
Amount available for investment from offering proceeds..... $24,000,862       $32,152,207 
                                                            -----------       ----------- 
Total development costs.................................... $52,860,779       $67,468,807 
                                                            ===========       =========== 
Percentage leverage (8)....................................       51.50%            48.47%
Date offering began........................................    Feb 2002          Aug 2002 
Average length of offering (days)..........................         181               122 
Months to invest 90% of amount available...................           1                 9 

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TABLE I 

EXPERIENCE IN RAISING AND INVESTING FUNDS 
(ON A PERCENTAGE BASIS) 
January 1, 2002 through December 31, 2004 

                                                        [Enlarge/Download Table]

                                                          Public Offerings                 
                                           ----------------------------------------------- 
                                             BCTC IV           BCTC IV           BCTC IV   
                                              L.P.              L.P.              L.P.     
                                           (Series 44)       (Series 45)       (Series 46) 
                                              2003              2003              2003     
                                           -----------       -----------       ----------- 
                                                                                           
Dollar amount offered (1)................. $27,019,730       $40,143,670       $29,809,980 
Dollar amount raised (100%)...............         100%              100%              100%
Less: Offering expenses                                                                    
Selling commissions and reimbursements                                                     
  retained by affiliates (2)..............        1.28%             1.23%             1.33%
Selling commissions and reimbursements to                                                  
  nonaffiliates (3).......................        8.72%             8.77%             8.67%
  Legal and organizational................        2.12%             1.90%             1.86%
                                           -----------       -----------       ----------- 
Total offering expenses...................       12.12%            11.90%            11.86%
                                           ===========       ===========       =========== 
Working capital reserves..................       16.20%            17.88%            21.06%
Amount available for investment from                                                       
  limited partners........................       87.88%            88.10%            88.14%
Acquisition fees (4)......................        8.50%             5.40%             5.40%
Acquisition expenses (5)..................        1.81%             2.40%             2.44%
Cash payments to operating partnerships                                                    
  (6).....................................       59.93%            61.48%            57.87%
                                           -----------       -----------       ----------- 
Total acquisition costs...................       86.44%            87.16%            86.77%
                                           ===========       ===========       =========== 
Mortgage financing........................ $26,439,744       $40,576,511       $24,965,412 
Additional capital (7).................... $   115,639       $ 1,174,894       $ 1,364,168 
                                           -----------       -----------       ----------- 
Total other sources....................... $26,555,383       $41,751,405       $26,329,580 
Amount available for investment from                                                       
  offering proceeds....................... $23,744,803       $35,366,208       $26,274,335 
                                           -----------       -----------       ----------- 
Total development costs................... $50,300,186       $77,117,613       $52,603,915 
                                           ===========       ===========       =========== 
Percentage leverage (8)...................       52.56%            52.62%            47.46%
Date offering began.......................    Jan 2003         July 2003         Sept 2003 
Average length of offering (days).........         104                78                87 
Months to invest 90% of amount                                                             
  available...............................         N/A               N/A               N/A 

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TABLE I 

EXPERIENCE IN RAISING AND INVESTING FUNDS 
(ON A PERCENTAGE BASIS) 
January 1, 2002 through December 31, 2004 

                                                        [Enlarge/Download Table]

                                                          Public Offerings                 
                                           ----------------------------------------------- 
                                             BCTC V            BCTC V            BCTC V    
                                              L.P.              L.P.              L.P.     
                                           (Series 47)       (Series 48)       (Series 49) 
                                              2004              2004              2004     
                                           -----------       -----------       ----------- 
                                                                                           
Dollar amount offered (1)................. $34,783,340       $22,993,720       $33,018,980 
Dollar amount raised (100%)...............         100%              100%              100%
Less: Offering expenses                                                                    
Selling commissions and reimbursements                                                     
  retained by affiliates (2)..............        1.47%             1.25%             2.15%
Selling commissions and reimbursements to                                                  
  nonaffiliates (3).......................        8.53%             8.75%             7.85%
  Legal and organizational................        1.77%             1.51%             2.17%
                                           -----------       -----------       ----------- 
Total offering expenses...................       11.77%            11.51%            12.17%
                                           ===========       ===========       =========== 
Working capital reserves..................        2.99%             3.45%            33.47%
Amount available for investment from                                                       
  limited partners........................       88.23%            88.49%            87.83%
Acquisition fees (4)......................        6.40%             6.40%             6.40%
Acquisition expenses (5)..................        1.42%             1.95%             0.29%
Cash payments to operating partnerships                                                    
  (6).....................................       76.07%            75.23%            47.09%
                                           -----------       -----------       ----------- 
Total acquisition costs...................       86.87%            87.02%            87.25%
                                           ===========       ===========       =========== 
Mortgage financing........................ $55,374,812       $28,248,158       $18,059,374 
Additional capital (7)....................     139,317            21,623               400 
                                           -----------       -----------       ----------- 
Total other sources....................... $55,514,129       $28,269,781       $18,059,774 
Amount available for investment from                                                       
  offering proceeds....................... $30,689,340       $20,347,585       $28,999,604 
                                           -----------       -----------       ----------- 
Total development costs................... $86,203,469       $48,617,366       $47,059,378 
                                           ===========       ===========       =========== 
Percentage leverage (8)...................       64.24%            58.10%            38.38%
Date offering began.......................    Jan 2004          May 2004          Aug 2004 
Average length of offering (days).........         116                92               N/A 
Months to invest 90% of amount                                                             
  available...............................           2                 4               N/A 

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TABLE I 

EXPERIENCE IN RAISING AND INVESTING FUNDS 
(ON A PERCENTAGE BASIS) 
January 1, 2002 through December 31, 2004 

                                                        [Enlarge/Download Table]

                                                    Private Offerings to Corporations                
                                    -----------------------------------------------------------------
                                    Boston Capital                    Boston Capital                 
                                    Corporate Tax    Boston Capital   Corporate Tax    Boston Capital
                                     Credit Fund         Direct        Credit Fund         Direct    
                                       XVIII,LP       Placements**        XIX,LP        Placements** 
                                         2002             2002             2003             2003     
                                    --------------   --------------   --------------   --------------
                                                                                                     
Dollar amount offered (1).........   $125,000,000     $131,273,604     $ 93,844,179     $70,292,557  
Dollar amount raised (100%).......            100%             100%             100%            100% 
Less: Offering expenses                                                                              
Selling commissions and                                                                              
  reimbursements retained by                                                                         
  affiliates......................            .90%             .72%            1.25%            .21% 
  Discounts offered to cash                                                                          
    investors (9).................          17.06%           17.85%           18.00%          10.22% 
  Investor note financing                                                                            
    expenses......................           1.16%            0.00%            0.00%           3.10% 
  Other selling commissions.......           0.23%            0.22%            0.20%           0.49% 
  Legal and organizational........           0.79%            0.55%            0.56%           0.40% 
                                     ------------     ------------     ------------     -----------  
Total offering expenses...........          20.13%           19.34%           20.02%          14.43% 
                                     ============     ============     ============     ===========  
Amount available for investment                                                                      
  from limited partners...........          79.87%           80.66%           79.98%          85.57% 
Acquisition costs                                                                                    
Acquisition fees (4)..............           1.75%            1.75%            1.75%           1.44% 
Acquisition expenses (5)..........           1.69%             .75%            1.57%            .62% 
Partnership management                                                                               
  fees (11).......................           1.75%            1.41%            1.75%           1.44% 
Investor service fees (10)........           0.50%            0.40%            0.50%           0.32% 
Working capital reserves..........           3.65%            1.80%            4.48%           6.25% 
Cash payments to operating                                                                           
  partnerships (6)................          70.53%           74.54%           69.93%          75.43% 
                                     ------------     ------------     ------------     -----------  
Total acquisition costs...........          79.87%           80.66%           79.98%          85.51% 
                                     ============     ============     ============     ===========  
Other sources of acquisition funds                                                                   
Mortgage financing................   $147,068,024     $135,238,003     $ 71,957,314     $39,567,758  
Additional capital (7)............   $  1,163,342     $    323,786     $    971,255     $    88,480  
                                     ------------     ------------     ------------     -----------  
Total other sources...............   $148,231,366     $135,561,789     $ 72,928,569     $39,656,238  
Amount available for investment                                                                      
  from offering proceeds..........   $ 99,833,688     $105,886,869     $ 75,060,562     $60,152,380  
                                     ------------     ------------     ------------     -----------  
Total development costs...........   $248,065,054     $241,448,658     $147,989,131     $99,808,618  
                                     ============     ============     ============     ===========  
Percentage leveraged (8)..........          59.29%           56.01%           48.62%          39.64% 
Percentage of equity invested.....            100%             100%             100%            100% 
Average length of offering                                                                           
  (days)..........................            320              N/A              209             N/A  

**  For presentation purposes Direct Placements are grouped by year.            

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TABLE I 

EXPERIENCE IN RAISING AND INVESTING FUNDS 
(ON A PERCENTAGE BASIS) 
January 1, 2002 through December 31, 2004 

                                                        [Enlarge/Download Table]

                                              Private Offerings to Corporations                          
                                   -------------------------------------------------------               
                                     Boston        Boston         Boston         Boston        Boston    
                                     Capital       Capital       Capital        Capital        Capital   
                                    Corporate     Corporate     Corporate      Corporate       Direct    
                                     Fund XX      Fund XXA       Fund XXI      Fund XXII     Placements  
                                      2004          2004           2004           2004          2004     
                                   -----------   -----------   ------------   ------------   ----------- 
                                                                                                         
Dollar amount offered (1)......... $36,898,485   $64,808,430   $173,897,938   $117,256,965   $ 9,379,712 
Dollar amount raised (100%).......         100%          100%           100%           100%          100%
Less: Offering expenses                                                                                  
Selling commissions and                                                                                  
  reimbursements retained by                                                                             
  affiliates......................        1.00%         1.00%          0.84%          0.00%         0.35%
  Discounts offered to cash                                                                              
    investors (9).................       18.00%        18.00%         18.98%         18.00%        18.00%
  Investor note financing                                                                                
    expenses......................        0.00%         0.00%          2.61%          3.36%         0.00%
  Other selling commissions.......        0.21%         0.21%          0.00%          0.01%         0.51%
  Legal and organizational........        0.57%         0.55%          0.17%          0.13%         0.77%
                                   -----------   -----------   ------------   ------------   ----------- 
Total offering expenses...........       19.78%        19.75%         22.60%         21.50%        19.63%
                                   ===========   ===========   ============   ============   =========== 
Amount available for investment                                                                          
  from limited partners...........       80.22%        80.25%         77.40%         78.50%        80.37%
Acquisition fees (4)..............        1.75%         1.75%          1.75%          1.56%         2.43%
Acquisition expenses (5)..........        1.01%         0.90%          0.86%          0.30%         1.02%
Partnership management                                                                                   
  fees (11).......................        1.75%         1.75%          1.75%          1.56%         1.24%
Investor service fees (10)........        0.50%         0.50%          0.50%          0.45%         0.35%
Working capital reserves..........        6.41%        14.21%          4.23%         36.58%         4.98%
Cash payments to operating                                                                               
  partnerships (6)................       68.80%        61.14%          68.3%         38.05%        70.35%
                                   -----------   -----------   ------------   ------------   ----------- 
                                         80.22%        80.25%         77.40%         78.50%        80.37%
                                   ===========   ===========   ============   ============   =========== 
Mortgage financing................ $51,300,820   $29,106,296   $196,545,147   $ 30,982,261   $16,683,871 
Additional capital (7)............ $       631   $   798,197   $    862,940   $    267,076   $       124 
                                   -----------   -----------   ------------   ------------   ----------- 
Total other sources............... $51,301,451   $29,904,493   $197,408,087   $ 31,249,337   $16,683,995 
Amount available for investment                                                                          
  from offering proceeds.......... $29,599,062   $52,006,691   $134,597,716   $ 92,043,986   $ 7,538,160 
                                   -----------   -----------   ------------   ------------   ----------- 
Total development costs........... $80,900,513   $81,911,184   $332,005,803   $123,293,323   $24,222,155 
                                   ===========   ===========   ============   ============   =========== 
Percentage leverage (8)...........       63.41%        35.53%         59.20%         25.13%        68.88%
Percentage of equity invested.....      100.00%       100.00%        100.00%        100.00%       100.00%
Average length of offering                                                                               
  (days)..........................         102           102            176            105           N/A 

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NOTES TO TABLE I

Note 1:  The dollar amount offered and raised includes the entire amount of     
investors' contributions paid.                                                  

Note 2:  Includes only the Dealer-Manager Fee that was retained by Boston       
Capital Securities, Inc. The amounts presented have been adjusted to reflect    
reimbursements made in March 2006 of certain offering expenses, including       
expenses associated with wholesaling services, by Boston Capital Holdings       
Limited Partnership to the applicable fund. These payments were voluntarily made
by Boston Capital Holdings Limited Partnership following an inquiry by the NASD 
of Boston Capital Securities, Inc. This inquiry has been resolved. See "Risk    
Factors--We are dependent on the dealer-manager."                               

Note 3:  Includes selling commissions of 7% and the re-allotment by Boston      
Capital Securities, Inc. of portions of its Dealer-Manager Fee and includes     
portions of the nonaccountable expense allowance.                               

Note 4:  Acquisition fees are amounts paid to the general partners and          
affiliates for selecting, evaluating, negotiating and closing the investment    
partnerships' acquisition of operating partnership interests.                   

Note 5:  Acquisition expenses consist of legal and accounting fees, travel,     
market studies and other expenses to be paid to third parties.                  

Note 6:  Cash payments to non-affiliated operating partnerships include capital 
contributions. The amount shown for 2004 includes 13.48% of public partnerships'
funds not yet committed.                                                        

Note 7:  Additional capital represents funds contributed by the operating       
general partners. Some properties financed with governmental assistance after   
1987 require the operating general partners to provide a minimum of 3% of the   
total development cost in equity.                                               

Note 8:  The leverage percentage equals the total amount of mortgage            
indebtedness on the acquisition date or completion date divided by total        
development costs.                                                              

Note 9:  Upon admission to Boston Capital's Corporate Funds, the limited        
partners choose to pay capital contributions under a standard installment method
or cash method (or in some cases a deferred cash method or alternative          
installment method). Standard installment method investors pay $1,000,000 per   
unit. Cash method investors (and deferred cash method or alternative installment
method investors where applicable) receive a discount for paying sooner.        

Note 10:  Investor Service Fees are amounts paid to the general partners and    
affiliates for arranging and organizing investor reporting and communications,  
and continuing services related to the transmittal of information to the        
Class A Limited Partners.                                                       

Note 11:  Partnership Management Fees are amounts paid to the general partners  
and affiliates for overseeing the day to day management of the Investor         
Partnership, including but not limited to financial reporting, audits, tax      
return preparation, cash management and reserves management.                    

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TABLE II
COMPENSATION TO AFFILIATES
January 1, 2002 through December 31, 2004 

Table II sets forth the aggregate amount of all compensation earned by or paid  
to the our Affiliates between January 1, 2002 and December 31, 2004 for the     
programs included in Table I. None of the programs included in this Table have  
been liquidated.                                                                

The Table should be read in conjunction with the introduction and accompanying  
notes.                                                                          

                                                        [Enlarge/Download Table]

                                                          Public Offerings                   
                                        -----------------------------------------------------
                                          BCTC IV       BCTC IV       BCTC IV       BCTC IV  
                                           L.P.          L.P.          L.P.          L.P.    
                                        (Series 42)   (Series 43)   (Series 44)   (Series 45)
                                           2002          2002          2003          2003    
                                        -----------   -----------   -----------   -----------
                                                                                             
Date offering commenced...............     Feb 2002      Aug 2002      Jan 2003     July 2003
Dollar amount raised (1)..............  $27,442,620   $36,379,870   $27,019,730   $40,143,670
Amounts paid and/or payable to sponsor                                                       
  and affiliates from proceeds (1):                                                          
Underwriting fees (2).................      599,303       578,415       401,565       552,275
Acquisition fees (3)..................    2,332,592     3,092,289     2,296,677     2,167,758
Acquisition expense reimbursement.....      775,559       914,438       488,145       963,122
Asset management fee..................      559,443       621,319       376,453       373,244
Dollar amount of cash generated from                                                         
  operating partnerships before                                                              
  payments to sponsors (4)............       17,648        25,738         3,287             0
Amount paid to sponsors                                                                      
  from operations (5).................            0             0             0             0

                                                        [Enlarge/Download Table]

                                                          Public Offerings                   
                                        -----------------------------------------------------
                                          BCTC IV       BCTC V        BCTC V        BCTC V   
                                           L.P.          L.P.          L.P.          L.P.    
                                        (Series 46)   (Series 47)   (Series 48)   (Series 49)
                                           2003          2004          2004          2004    
                                        -----------   -----------   -----------   -----------
                                                                                             
Date offering commenced...............    Sept 2003                                          
Dollar amount raised (1)..............  $29,809,980   $34,783,340   $22,993,720   $33,018,980
Amounts paid and/or payable to sponsor                                                       
  and affiliates from proceeds (1):                                                          
Underwriting fees (2).................      436,457       563,377       314,247       718,393
Acquisition fees (3)..................    1,609,739     2,226,134     1,471,598     2,113,180
Acquisition expense reimbursement.....      727,752       492,773       447,375        95,142
Asset management fee..................      173,834       226,339        71,423         6,001
Dollar amount of cash generated from                                                         
  operating partnerships before                                                              
  payments to sponsors (4)............            0             0             0             0
Amount paid to sponsors                                                                      
  from operations (5).................            0             0             0             0

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TABLE II
COMPENSATION TO SPONSOR AND AFFILIATES
January 1, 2002 through December 31, 2004 

                                                        [Enlarge/Download Table]

                                                  Private Offerings for Corporations                
                                   -----------------------------------------------------------------
                                   Boston Capital                    Boston Capital                 
                                     Corporate      Boston Capital     Corporate      Boston Capital
                                     Tax Credit         Direct         Tax Credit         Direct    
                                     Fund XVIII       Placements        Fund XIX        Placements  
                                        2002           2002 (6)           2003           2003 (6)   
                                   --------------   --------------   --------------   --------------
                                                                                                    
Dollar amount raised (1)..........  $125,000,000     $131,273,604     $93,844,179      $70,292,577  
Amounts paid and/or payable to                                                                      
  sponsor and affiliates from                                                                       
  proceeds (1):                                                                                     
Underwriting fees (2).............     1,122,223          748,638       1,173,052          149,486  
Acquisition fees (3)..............     2,187,500        2,300,965       1,642,229        1,009,489  
Acquisition expense                                                                                 
  reimbursement...................     2,117,079          983,503       1,471,204          439,163  
Partnership management fees.......     2,187,500        1,853,219       1,642,229        1,009,489  
Investor service fees.............       625,000          529,493         469,208          228,427  
Asset management fee..............     1,227,872        1,015,594         578,752          304,055  
Dollar amount of cash generated                                                                     
  from operating partnerships                                                                       
  before payments to sponsors                                                                       
  (4).............................         1,185           18,808               0                0  
Amounts paid to sponsors                                                                            
  from operations (5).............             0                0               0                0  

                                                        [Enlarge/Download Table]

                                                   Private Offerings for Corporations                  
                                  ---------------------------------------------------------------------
                                    Boston        Boston         Boston         Boston                 
                                    Capital       Capital       Capital        Capital        Boston   
                                   Corporate     Corporate     Corporate      Corporate       Capital  
                                  Tax Credit    Tax Credit     Tax Credit     Tax Credit      Direct   
                                    Fund XX      Fund XX-A      Fund XXI      Fund XXII     Placements 
                                     2004          2004           2004           2004        2004 (6)  
                                  -----------   -----------   ------------   ------------   -----------
                                                                                                       
Dollar amount raised (1)......... $36,898,485   $64,808,430   $173,897,938   $117,256,965   $9,379,712 
Amounts paid and/or payable to                                                                         
  sponsor and affiliates from                                                                          
  proceeds (1):                                                                                        
Underwriting fees (2)............     368,985       648,085      1,719,756              0       32,966 
Acquisition fees (3).............     645,723     1,134,148      3,043,214      1,832,229      227,724 
Acquisition expense                                                                                    
  reimbursement..................     372,369       581,995      1,503,024        353,494       96,043 
Partnership management fees......     645,723     1,134,148      3,043,214      1,832,229      116,260 
Investor service fees............     184,492       324,042        869,490        523,494       33,217 
Asset management fee.............     153,740       270,040        345,764         73,908       44,596 
Dollar amount of cash generated                                                                        
  from operating partnerships                                                                          
  before payments to sponsors                                                                          
  (4)............................           0             0              0              0            0 
Amounts paid to sponsors                                                                               
  from operations (5)............           0             0              0              0            0 

NOTES TO TABLE II 

Note 1: Table II is presented as if all capital contributions were received and 
all fees payable from offering proceeds to our affiliates, and their            
predecessors in interest were paid in the year in which the offerings were      
completed; such transactions actually occur over several years.                 

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Note 2: Underwriting fees include non-accountable expense allowances, research  
report fees, due diligence fees, selling commissions, purchaser representative  
fees, and capital commitment fees. These amounts do not include commissions paid
to an affiliated dealer-manager which were subsequently paid to non-affiliated  
brokers. These fees are paid over one to three years.                           

Note 3: The Acquisition Fee is a flat fee calculated as a percentage of each    
certificate sold. It is earned for selecting, evaluating, negotiating and       
closing series' investments in apartment complexes.                             

Note 4: The dollar amount of cash generated from operating partnerships is the  
total amount of cash distributions received by the investment partnerships      
during the three-year period. For example: 2004 would include 2002-2004 cash    
distributions for the partnership organized in 2002. Historically, cash flow    
from government-subsidized apartment complexes is generated by the second full  
year of operations, yet cash flow is not disbursed until financial statement    
analyses are complete.                                                          

Note 5: If cash flow is unavailable to pay investment partnership operating     
expenses, then expenses are either accrued until cash flow is available in      
future years to repay such expenses or the sponsor pays these operating expenses
as they become due and subsequently receives reimbursement when cash flow is    
available.                                                                      

Note 6: For presentation purposes, private Direct Placement Limited Partnerships
are grouped by year. The 2002, 2003 and 2004 Direct Placement Limited           
Partnerships contain 4, 5 and 2 partnerships, respectively.                     

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TABLE III 

OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 

Table III summarizes the operating results of prior partnerships not having     
similar investment objectives to the Company which were closed between          
January 1, 2000 and December 31, 2004. The public investment partnerships own   
interests in 176 operating partnerships. The private investment partnerships own
interests in 292 operating partnerships. For presentation purposes, private     
Direct Placement Limited Partnerships are grouped by year. The 2002, 2003 and   
2004 Direct Placement Limited Partnerships contain 4, 5 and 2 partnerships,     
respectively.                                                                   

Table III includes the actual tax credits received on a $1,000 investment. Table
III-A includes the actual tax credits received as a percentage of capital       
invested by an investor. For example, if an investor received $21 of tax credits
on a $1,000 investment for a particular year in Table III, Table III-A would    
show that for that year the investor received approximately 2.1% of its         
investment.                                                                     

The information is presented in accordance with generally accepted accounting   
principles ("GAAP") except with respect to the information presented in the     
tables labeled "Tax & Distribution Data Per $1000 invested on a Tax Basis,"     
which is presented on the tax basis method of accounting.                       

Significant differences can occur in operating results accounted for on a tax   
versus GAAP basis. Some differences, but not all, are due to depreciation       
methods and depreciable lives, and treatment of capitalized construction period 
interest and expenses. The usual effect of these differences is that taxable    
losses under GAAP would have been less than the taxable losses. Both GAAP and   
tax losses are reported in the table.                                           

The Table should be read in conjunction with the introduction and accompanying  
Notes.                                                                          

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2000 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 38)

                                                        [Enlarge/Download Table]

                                                       For the Financial Statement                       
                                                         period ended March 31,                          
                                   2000       2001        2002         2003         2004         2005    
                                 --------   --------   ----------   ----------   ----------   ---------- 
                                                                                                         
Gross Revenues..................    1,437    207,525       92,319       14,985          667          623 
Profit on sale of properties....        0          0            0            0            0            0 
Less:                                                                                                    
  Losses from operating                                                                                  
    partnerships (1)............        0   (133,908)  (1,230,809)    (892,478)    (997,707)    (875,622)
  Operating Expenses (3)........  (83,131)  (219,590)    (216,080)    (194,567)    (191,940)    (572,924)
  Interest Expense..............        0          0            0            0            0            0 
  Depreciation (2)..............        0          0      (50,939)     (98,914)     (98,911)     (98,912)
Net Income--GAAP Basis..........  (81,694)  (145,973)  (1,405,509)  (1,170,974)  (1,287,891)  (1,546,835)
Taxable Income from                                                                                      
  operations (4)................        0   (151,741)  (1,685,712)  (1,415,038)  (1,521,318)  (1,205,590)
  gain on sale..................        0          0            0            0            0            0 
Cash generated from                                                                                      
  operations (6)................  361,642    156,853     (161,584)     110,534       (7,729)     178,026 
Cash generated from sales.......        0          0            0            0            0            0 
Cash generated from                                                                                      
  refinancing...................        0          0            0            0            0            0 
Cash generated from operations,                                                                          
sales and refinancing...........  361,642    156,853     (161,584)     110,534       (7,729)     178,026 
Less: Cash distributions to                                                                              
  investors                                                                                              
  from operating cash flow......        0          0            0            0            0            0 
  from sales and refinancing....        0          0            0            0            0            0 
  from other....................        0          0            0            0            0            0 
Cash generated (deficiency)                                                                              
  after cash distributions......  361,642    156,853     (161,584)     110,534       (7,729)     178,026 
Less: Special items (not                                                                                 
  including sales and                                                                                    
  refinancing) (identify and                                                                             
  quantify).....................        0          0            0            0            0            0 
Cash generated (deficiency)                                                                              
  after cash distributions and                                                                           
  special items.................  361,642    156,853     (161,584)     110,534       (7,729)     178,026 

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                       For the Tax period ended December 31,          
                                                       2000        2001        2002        2003        2004  
Per $1,000 invested (7)                              --------    --------    --------    --------    --------
                                                                                                             
Federal Income Tax Results                                                                                   
  Federal Credit (5)................................     11         45          92          94           94  
  State Credit......................................      0          0                                    0  
  Ordinary Income(loss).............................     (6)       (67)        (55)        (59)         (47) 
    from operations.................................     (6)       (67)        (55)        (59)         (47) 
    from recapture..................................      0          0           0           0            0  
  Capital gain (loss)...............................      0          0           0           0            0  
Cash Distributions to investors:                                                                             
  Source (on GAAP basis):                                                                                    
    Investment income...............................      0          0           0           0            0  
    Return of capital...............................      0          0           0           0            0  
  Source (on cash basis):                                                                                    
    Sales...........................................      0          0           0           0            0  
    Refinancing.....................................      0          0           0           0            0  
    Operations......................................      0          0           0           0            0  
    Other...........................................      0          0           0           0            0  
Amount remaining invested in program properties.....                                                  99.08% 

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2000 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 39)

                                                        [Enlarge/Download Table]

                                                           For the Financial Statement                  
                                                              period ended March 31,                    
                                             2001        2002         2003         2004         2005    
                                           --------   ----------   ----------   ----------   ---------- 
                                                                                                        
Gross Revenues...........................    49,735      116,518        2,441          352          696 
Profit on sale of properties.............         0            0            0            0            0 
Less:                                                                                                   
  Losses from operating                                                                                 
    partnerships (1).....................     3,760     (996,269)  (1,093,075)  (1,147,985)    (856,990)
  Operating Expenses (3).................  (196,332)    (222,619)    (159,861)    (162,135)    (369,125)
  Interest Expense.......................         0            0            0            0            0 
  Depreciation (2).......................         0      (24,477)     (90,324)     (90,325)     (90,327)
Net Income--GAAP Basis...................  (142,837)  (1,126,847)  (1,340,819)  (1,400,093)  (1,315,746)
Taxable Income                                                                                          
from operations (4)......................    69,342   (1,165,268)  (1,639,228)  (1,522,678)  (1,150,182)
  gain on sale...........................         0            0            0            0            0 
Cash generated from operations (6).......  (147,183)     (71,182)     (16,079)     146,889      102,227 
Cash generated from sales................         0            0            0            0            0 
Cash generated from refinancing..........         0            0            0            0            0 
Cash generated from operations, sales and                                                               
  refinancing............................  (147,183)     (71,182)     (16,079)     146,889      102,227 
Less: Cash distributions to investors                                                                   
  from operating cash flow...............         0            0            0            0            0 
  from sales and refinancing.............         0            0            0            0            0 
  from other.............................         0            0            0            0            0 
Cash generated (deficiency) after cash                                                                  
  distributions..........................  (147,183)     (71,182)     (16,079)     146,889      102,227 
Less: Special items (not including sales                                                                
  and refinancing) (identify and                                                                        
  quantify)..............................         0            0            0            0            0 
Cash generated (deficiency) after cash                                                                  
  distributions and special items........  (147,183)     (71,182)     (16,079)     146,889      102,227 

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                       For the Tax period ended December 31,          
                                                       2000        2001        2002        2003        2004  
Per $1,000 invested (7)                              --------    --------    --------    --------    --------
                                                                                                             
Federal Income Tax Results                                                                                   
  Federal Credit (5)................................      0         22          84          93           93  
  State Credit......................................      0          0           0           0            0  
  Ordinary Income (loss)............................      4        (55)        (71)        (66)         (50) 
    from operations.................................      4        (55)        (71)        (66)         (50) 
    from recapture..................................      0          0           0           0            0  
  Capital gain (loss)...............................      0          0           0           0            0  
Cash Distributions to investors:                                                                             
  Source (on GAAP basis)............................      0          0                                       
    Investment income...............................      0          0           0           0            0  
    Return of capital...............................      0          0           0           0            0  
  Source (on cash basis):                                                                                    
    Sales...........................................      0          0           0           0            0  
    Refinancing.....................................      0          0           0           0            0  
    Operations......................................      0          0           0           0            0  
    Other...........................................      0          0           0           0            0  
Amount remaining invested in program properties.....                                                  97.55% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2001 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 40)

                                                        [Enlarge/Download Table]

                                                           For the Financial Statement                  
                                                              period ended March 31,                    
                                              2001        2002        2003         2004         2005    
                                           ----------   --------   ----------   ----------   ---------- 
                                                                                                        
Gross Revenues...........................       2,317    147,345      119,938          299           90 
Profit on sale of properties.............           0          0            0            0            0 
Less:                                                                                                   
  Losses from operating                                                                                 
    partnerships (1).....................           0   (438,656)    (986,508)    (936,159)    (924,404)
  Operating Expenses (3).................    (113,781)  (306,075)    (222,136)    (233,925)    (490,886)
  Interest Expense.......................           0          0            0            0            0 
  Depreciation (2).......................           0          0      (32,319)    (113,716)    (113,730)
Net Income--GAAP Basis...................    (111,464)  (597,386)  (1,121,025)  (1,283,501)  (1,528,930)
Taxable Income from operations (4).......           0   (586,896)  (1,086,143)  (1,633,930)  (1,521,793)
  gain on sale...........................           0          0            0            0            0 
Cash generated from operations (6).......  (1,922,962)   836,927      209,484      109,930       (9,242)
Cash generated from sales................           0          0            0            0            0 
Cash generated from refinancing..........           0          0            0            0            0 
Cash generated from operations, sales and                                                               
  refinancing............................  (1,922,962)   836,927      209,484      109,930       (9,242)
Less: Cash distributions to investors                                                                   
  from operating cash flow...............           0          0            0            0            0 
  from sales and refinancing.............           0          0            0            0            0 
  from other.............................           0          0            0            0            0 
Cash generated (deficiency) after cash                                                                  
  distributions..........................  (1,922,962)   836,927      209,484      109,930       (9,242)
Less: Special items (not including sales                                                                
  and refinancing) (identify and                                                                        
  quantify)..............................           0          0            0            0            0 
Cash generated (deficiency) after cash                                                                  
  distributions and special items........  (1,922,962)   836,927      209,484      109,930       (9,242)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                   For the Tax period ended December 31,          
                                                   2001            2002            2003            2004  
Per $1,000 invested (7)                          --------        --------        --------        --------
                                                                                                         
Federal Income Tax Results                                                                               
  Federal Credit (5)............................     14             80              93               92  
  State Credit..................................      0              0               0                0  
  Ordinary Income (loss)........................    (24)           (42)            (62)             (57) 
    from operations.............................    (24)           (42)            (62)             (57) 
    from recapture..............................      0              0               0                0  
  Capital gain (loss)...........................      0              0               0                0  
Cash Distributions to investors:                                                                         
  Source (on GAAP basis)........................      0                                                  
    Investment income...........................      0              0               0                0  
    Return of capital...........................      0              0               0                0  
  Source (on cash basis):                                                                                
    Sales.......................................      0              0               0                0  
    Refinancing.................................      0              0               0                0  
    Operations..................................      0              0               0                0  
    Other.......................................      0              0               0                0  
Amount remaining invested in program                                                                     
  properties....................................                                                  99.43% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2001 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 41)

                                                        [Enlarge/Download Table]

                                                        For the Financial Statement           
                                                          period ended March 31,              
                                                2002        2003         2004         2005    
                                              --------   ----------   ----------   ---------- 
                                                                                              
Gross Revenues...............................   52,147       74,991       34,112        4,540 
Profit on sale of properties.................        0            0            0            0 
Less:                                                                                         
  Losses from operating partnerships (1).....  (94,125)  (1,443,650)  (1,748,067)  (4,159,348)
  Operating Expenses (3)..................... (241,945)    (346,349)    (342,003)    (294,717)
  Interest Expense...........................        0            0            0            0 
  Depreciation (2)...........................        0     (133,377)    (133,405)    (133,882)
Net Income--GAAP Basis....................... (283,923)  (1,848,385)  (2,189,363)  (4,583,407)
Taxable Income from operations (4)........... (120,068)  (2,867,903)  (1,609,628)  (3,730,419)
  gain on sale...............................        0            0            0            0 
Cash generated from operations (6)...........  (47,951)     (48,190)       8,731      363,790 
Cash generated from sales....................        0            0            0            0 
Cash generated from refinancing..............        0            0            0            0 
Cash generated from operations, sales and                                                     
  refinancing................................  (47,951)     (48,190)       8,731      363,790 
Less: Cash distributions to investors                                                         
  from operating cash flow...................        0            0            0            0 
  from sales and refinancing.................        0            0            0            0 
  from other.................................        0            0            0            0 
Cash generated (deficiency) after cash                                                        
  distributions..............................  (47,951)     (48,190)       8,731      363,790 
Less: Special items (not including sales and                                                  
  refinancing) (identify and quantify).......        0            0            0            0 
Cash generated (deficiency) after cash                                                        
  distributions and special items............  (47,951)     (48,190)       8,731      363,790 

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                   For the Tax period ended December 31,          
                                                   2001            2002            2003            2004  
Per $1,000 invested (7)                          --------        --------        --------        --------
                                                                                                         
Federal Income Tax Results                                                                               
  Federal Credit (5)............................      1             45             104              110  
  State Credit..................................      0              0               0                0  
  Ordinary Income (loss)........................     (4)           (95)            (55)            (128) 
    from operations.............................     (4)           (95)            (55)            (128) 
    from recapture..............................      0              0               0                0  
  Capital gain (loss)...........................      0              0               0                0  
Cash Distributions to investors:                                                                         
  Source (on GAAP basis)........................      0                                                  
    Investment income...........................      0              0               0                0  
    Return of capital...........................      0              0               0                0  
  Source (on cash basis):                                                                                
    Sales.......................................      0              0               0                0  
    Refinancing.................................      0              0               0                0  
    Operations..................................      0              0               0                0  
  Other.........................................      0              0               0                0  
Amount remaining invested in program                                                                     
  properties....................................                                                  99.56% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2002 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 42)

                                                        [Enlarge/Download Table]

                                                       For the Financial Statement            
                                                         period ended March 31,               
                                               2002         2003         2004         2005    
                                            ----------   ----------   ----------   ---------- 
                                                                                              
Gross Revenues.............................        986      121,043      244,164        8,848 
Profit on sale of properties...............          0            0            0            0 
Less:                                                                                         
  Losses from operating                                                                       
    partnerships (1).......................          0     (404,748)  (1,617,204)  (1,150,391)
  Operating Expenses (3)...................   (111,253)    (237,706)    (315,633)    (264,513)
  Interest Expense.........................          0            0            0            0 
  Depreciation (2).........................          0            0     (113,984)    (115,498)
Net Income--GAAP Basis.....................   (110,267)    (521,411)  (1,802,657)  (1,521,554)
Taxable Income from operations (4).........          0     (755,961)  (1,771,458)  (1,838,771)
  gain on sale.............................          0            0            0            0 
Cash generated from operations (6)......... (1,322,182)   1,306,517      218,107       25,193 
Cash generated from sales..................          0            0            0            0 
Cash generated from refinancing............          0            0            0            0 
Cash generated from operations, sales and                                                     
  refinancing.............................. (1,322,182)   1,306,517      218,107       25,193 
Less: Cash distributions to investors                                                         
  from operating cash flow.................          0            0            0            0 
  from sales and refinancing...............          0            0            0            0 
  from other...............................          0            0            0            0 
Cash generated (deficiency) after cash                                                        
  distributions............................ (1,322,182)   1,306,517      218,107       25,193 
Less: Special items (not including sales                                                      
  and refinancing) (identify and                                                              
  quantify)................................          0            0            0            0 
Cash generated (deficiency) after cash                                                        
  distributions and special items.......... (1,322,182)   1,306,517      218,107       25,193 

                                                        [Enlarge/Download Table]

                                                                For the Tax period ended     
                                                                      December 31,           
Tax & Distribution Data                                       2002        2003        2004   
Per $1,000 invested (7)                                     ---------   ---------   ---------
                                                                                             
Federal Income Tax Results                                                                   
  Federal Credit (5).......................................     16          81           95  
  State Credit.............................................      0           0            0  
  Ordinary Income (loss)...................................    (29)        (64)         (67) 
    from operations........................................    (29)        (64)         (67) 
    from recapture.........................................      0           0            0  
  Capital gain (loss)......................................      0           0            0  
Cash Distributions to investors:                                                             
  Source (on GAAP basis)                                                                     
    Investment income......................................      0           0            0  
    Return of capital......................................      0           0            0  
  Source (on cash basis):                                                                    
    Sales..................................................      0           0            0  
    Refinancing............................................      0           0            0  
    Operations.............................................      0           0            0  
    Other..................................................      0           0            0  
Amount remaining invested in program properties............                            97.8% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2002 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 43)

                                                        [Enlarge/Download Table]

                                                              For the Financial Statement      
                                                                 period ended March 31,        
                                                             2003         2004         2005    
                                                          ----------   ----------   ---------- 
                                                                                               
Gross Revenues..........................................      30,298      332,401       77,015 
Profit on sale of properties............................           0            0            0 
Less:                                                                                          
  Losses from operating partnerships (1)................    (304,873)  (2,388,403)  (2,028,092)
  Operating Expenses (3)................................    (215,795)    (474,808)    (378,335)
  Interest Expense......................................           0            0            0 
  Depreciation (2)......................................           0     (148,464)    (164,530)
Net Income--GAAP Basis..................................    (490,370)  (2,679,274)  (2,493,942)
Taxable Income from operations (4)......................    (193,688)  (2,339,382)  (2,878,799)
  gain on sale..........................................           0            0            0 
Cash generated from operations (6)......................  (1,103,274)   1,251,676       34,397 
Cash generated from sales...............................           0            0            0 
Cash generated from refinancing.........................           0            0            0 
Cash generated from operations, sales and refinancing...  (1,103,274)   1,251,676       34,397 
Less: Cash distributions to investors from operating                                           
  cash flow.............................................           0            0            0 
  from sales and refinancing............................           0            0            0 
  from other............................................           0            0            0 
Cash generated (deficiency) after cash distributions....  (1,103,274)   1,251,676       34,397 
Less: Special items (not including sales and                                                   
  refinancing) (identify and quantify)..................           0            0            0 
Cash generated (deficiency) after cash distributions and                                       
  special items.........................................  (1,103,274)   1,251,676       34,397 

                                                        [Enlarge/Download Table]

                                                                For the Tax period ended     
Tax & Distribution Data                                               December 31,           
                                                              2002        2003        2004   
Per $1,000 invested (7)                                     ---------   ---------   ---------
                                                                                             
Federal Income Tax Results                                                                   
  Federal Credit (5).......................................      2          44           86  
  State Credit.............................................      0           0            0  
  Ordinary Income (loss)...................................     (5)        (65)         (80) 
    from operations........................................     (5)        (65)         (80) 
    from recapture.........................................      0           0            0  
  Capital gain (loss)......................................      0           0            0  
Cash Distributions to investors:                                                             
  Source (on GAAP basis)                                                                     
    Investment income......................................      0           0            0  
    Return of capital......................................      0           0            0  
  Source (on cash basis):                                                                    
    Sales..................................................      0           0            0  
    Refinancing............................................      0           0            0  
    Operations.............................................      0           0            0  
    Other..................................................      0           0            0  
Amount remaining invested in program properties............                            98.5% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2003 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 44)

                                                        [Enlarge/Download Table]

                                                              For the Financial Statement     
                                                                 period ended March 31,       
                                                             2003        2004         2005    
                                                           --------   ----------   ---------- 
                                                                                              
Gross Revenues............................................    1,379      159,792      229,754 
Profit on sale of properties..............................        0            0              
Less:                                                                                         
  Losses from operating partnerships (1)..................        0   (1,113,620)    (866,297)
  Operating Expenses (3).................................. (116,399)    (360,833)    (375,509)
  Interest Expense........................................        0            0            0 
  Depreciation (2)........................................        0      (28,115)    (101,629)
Net Income--GAAP Basis.................................... (115,020)  (1,342,776)  (1,113,681)
Taxable Income from operations (4)........................   (6,086)  (1,449,234)  (1,553,771)
  gain on sale............................................        0            0            0 
Cash generated from operations (6)........................  701,819     (902,659)      64,864 
Cash generated from sales.................................        0            0            0 
Cash generated from refinancing...........................        0            0            0 
Cash generated from operations, sales and refinancing.....  701,819     (902,659)      64,864 
Less: Cash distributions to investors                                                         
  from operating cash flow................................        0            0            0 
  from sales and refinancing..............................        0            0            0 
  from other..............................................        0            0            0 
Cash generated (deficiency) after cash distributions......  701,819     (902,659)      64,864 
Less: Special items (not including sales and refinancing)                                     
  (identify and quantify).................................        0            0            0 
Cash generated (deficiency) after cash distributions and                                      
  special items...........................................  701,819     (902,659)      64,864 

                                                        [Enlarge/Download Table]

                                                               For the Tax Period ended   
Tax & Distribution Data                                              December 31,         
                                                                 2003            2004     
Per $1,000 invested (7)                                      -------------   -------------
                                                                                          
Federal Income Tax Results                                                                
  Federal Credit (5)........................................       23               67    
  State Credit..............................................        0                0    
  Ordinary Income (loss)....................................      (54)             (61)   
    from operations.........................................      (54)             (61)   
    from recapture..........................................        0                0    
  Capital gain (loss).......................................        0                0    
Cash Distributions to investors:                                                          
  Source (on GAAP basis)                                                                  
    Investment income.......................................        0                0    
    Return of capital.......................................        0                0    
  Source (on cash basis):                                                                 
    Sales...................................................        0                0    
    Refinancing.............................................        0                0    
    Operations..............................................        0                0    
    Other...................................................        0                0    
Amount remaining invested in program properties.............                        98%   

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2003 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 45)

                                                        [Enlarge/Download Table]

                                                               For the Financial Statement  
                                                                 period ended March 31,     
                                                                  2004             2005     
                                                             --------------   --------------
                                                                                            
Gross Revenues..............................................      188,952          521,517  
Profit on sale of properties................................            0                0  
Less:                                                                                       
  Losses from operating partnerships (1)....................     (258,419)      (1,067,071) 
  Operating Expenses (3)....................................     (442,793)        (635,881) 
  Interest Expense..........................................            0                0  
  Depreciation (2)..........................................      (32,122)        (133,300) 
Net Income--GAAP Basis......................................     (544,382)      (1,314,735) 
Taxable Income from operations (4)..........................     (944,267)      (1,192,433) 
  gain on sale..............................................            0                0  
Cash generated from operations (6)..........................   (1,268,112)         532,093  
Cash generated from sales...................................            0                0  
Cash generated from refinancing.............................            0                0  
Cash generated from operations, sales and refinancing.......   (1,268,112)         532,093  
Less: Cash distributions to investors from operating cash                                   
  flow......................................................            0                0  
  from sales and refinancing................................            0                0  
  from other................................................            0                0  
Cash generated (deficiency) after cash distributions........   (1,268,112)         532,093  
Less: Special items (not including sales and refinancing)                                   
  (identify and quantify)...................................            0                0  
Cash generated (deficiency) after cash distributions and                                    
  special items.............................................   (1,268,112)         532,093  

                                                        [Enlarge/Download Table]

                                                               For the Tax Period ended   
                                                                     December 31,         
Tax & Distribution Data                                                                   
                                                                 2003            2004     
Per $1,000 invested (7)                                      -------------   -------------
                                                                                          
Federal Income Tax Results                                                                
  Federal Credit (5)........................................        9              55     
  State Credit..............................................        0               0     
  Ordinary Income (loss)....................................      (24)            (34)    
    from operations.........................................      (24)            (34)    
    from recapture..........................................        0               0     
  Capital gain (loss).......................................        0               0     
Cash Distributions to investors:                                                          
  Source (on GAAP basis)                                                                  
    Investment income.......................................        0               0     
    Return of capital.......................................        0               0     
  Source (on cash basis):                                                                 
    Sales...................................................        0               0     
    Refinancing.............................................        0               0     
    Operations..............................................        0               0     
    Other...................................................        0               0     
Amount remaining invested in program properties.............                     98.6%    

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2003 
BOSTON CAPITAL TAX CREDIT FUND IV L.P. (SERIES 46)

                                                        [Enlarge/Download Table]

                                                               For the Financial Statement  
                                                                 period ended March 31,     
                                                                  2004             2005     
                                                             --------------   --------------
                                                                                            
Gross Revenues..............................................      63,499           254,425  
Profit on sale of properties................................           0                 0  
Less:                                                                                       
  Losses from operating partnerships (1)....................     (81,632)         (385,946) 
  Operating Expenses (3)....................................    (184,356)         (392,684) 
  Interest Expense..........................................           0                 0  
  Depreciation (2)..........................................      (3,812)         (100,878) 
Net Income--GAAP Basis......................................    (206,301)         (625,083) 
Taxable Income from operations (4)..........................     (28,992)       (1,116,282) 
  gain on sale..............................................           0                 0  
Cash generated from operations (6)..........................    (119,134)          (70,876) 
Cash generated from sales...................................           0                 0  
Cash generated from refinancing.............................           0                 0  
Cash generated from operations, sales and refinancing.......    (119,134)          (70,876) 
Less: Cash distributions to investors from operating cash                                   
  flow......................................................           0                 0  
  from sales and refinancing................................           0                 0  
  from other................................................           0                 0  
Cash generated (deficiency) after cash distributions........    (119,134)          (70,876) 
Less: Special items (not including sales and refinancing)                                   
  (identify and quantify)...................................           0                 0  
Cash generated (deficiency) after cash distributions and                                    
  special items.............................................    (119,134)          (70,876) 

                                                        [Enlarge/Download Table]

                                                               For the Tax Period ended   
Tax & Distribution Data                                              December 31,         
                                                                 2003            2004     
Per $1,000 invested (7)                                      -------------   -------------
                                                                                          
Federal Income Tax Results                                                                
  Federal Credit (5)........................................        0              24     
  State Credit..............................................        0               0     
  Ordinary Income (loss)....................................       (1)            (41)    
    from operations.........................................       (1)            (41)    
    from recapture..........................................        0               0     
  Capital gain (loss).......................................        0               0     
Cash Distributions to investors:                                                          
  Source (on GAAP basis)                                                                  
    Investment income.......................................        0               0     
    Return of capital.......................................        0               0     
  Source (on cash basis):                                                                 
    Sales...................................................        0               0     
    Refinancing.............................................        0               0     
    Operations..............................................        0               0     
    Other...................................................        0               0     
Amount remaining invested in program properties.............                      100%    

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2004 
BOSTON CAPITAL TAX CREDIT FUND V L.P. (SERIES 47) 

                                                        [Enlarge/Download Table]

                                                               For the Financial Statement  
                                                                 period ended March 31,     
                                                                  2004             2005     
                                                             --------------   --------------
                                                                                            
Gross Revenues..............................................        3,814          207,493  
Profit on sale of properties................................            0                0  
Less:                                                                                       
  Losses from operating partnerships (1)....................            0         (992,975) 
  Operating Expenses (3)....................................      (26,315)        (677,933) 
  Interest Expense..........................................            0                0  
  Depreciation (2)..........................................            0          (51,236) 
Net Income--GAAP Basis......................................      (22,501)      (1,514,651) 
Taxable Income from operations (4)..........................          N/A       (1,061,479) 
  gain on sale..............................................            0                0  
Cash generated from operations (6)..........................   (4,075,224)       3,765,363  
Cash generated from sales...................................            0                0  
Cash generated from refinancing.............................            0                0  
Cash generated from operations, sales and refinancing.......   (4,075,224)       3,765,363  
Less: Cash distributions to investors                                                       
  from operating cash flow..................................            0                0  
  from sales and refinancing................................            0                0  
  from other................................................            0                0  
Cash generated (deficiency) after cash distributions........   (4,075,224)       3,765,363  
Less: Special items (not including sales and refinancing)                                   
  (identify and quantify)...................................            0                0  
Cash generated (deficiency) after cash distributions and                                    
  special items.............................................   (4,075,224)       3,765,363  

                                                        [Enlarge/Download Table]

                                                             For the Tax Period ended 
Tax & Distribution Data                                            December 31,       
                                                                       2004           
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................              9           
  State Credit..............................................              0           
  Ordinary Income (loss)....................................            (31)          
    from operations.........................................            (31)          
    from recapture..........................................              0           
  Capital gain (loss).......................................              0           
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................              0           
    Return of capital.......................................              0           
  Source (on cash basis):                                                             
    Sales...................................................              0           
    Refinancing.............................................              0           
    Operations..............................................              0           
    Other...................................................              0           
Amount remaining invested in program properties.............            100%          

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2004 
BOSTON CAPITAL TAX CREDIT FUND V L.P. (SERIES 48) 

                                                        [Enlarge/Download Table]

                                                             For the Financial Statement
                                                               period ended March 31,   
                                                                        2005            
                                                             ---------------------------
                                                                                        
Gross Revenues..............................................            92,821          
Profit on sale of properties................................                 0          
Less:                                                                                   
  Losses from operating partnerships (1)....................          (213,922)         
  Operating Expenses (3)....................................          (368,949)         
  Interest Expense..........................................                 0          
  Depreciation (2)..........................................           (18,570)         
Net Income-GAAP Basis.......................................          (508,620)         
Taxable Income from operations (4)..........................          (291,868)         
  gain on sale..............................................                 0          
Cash generated from operations (6)..........................           (78,440)         
Cash generated from sales...................................                 0          
Cash generated from refinancing.............................                 0          
Cash generated from operations, sales and refinancing.......           (78,440)         
Less: Cash distributions to investors                                                   
  from operating cash flow..................................                 0          
  from sales and refinancing................................                 0          
  from other................................................                 0          
Cash generated (deficiency) after cash distributions........           (78,440)         
Less: Special items (not including sales and refinancing)                               
  (identify and quantify)...................................                 0          
Cash generated (deficiency) after cash distributions and                                
  special items.............................................           (78,440)         

                                                        [Enlarge/Download Table]

                                                             For the Tax Period ended 
Tax & Distribution Data                                            December 31,       
                                                                       2004           
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................              0           
  State Credit..............................................              0           
  Ordinary Income (loss)....................................            (13)          
    from operations.........................................            (13)          
    from recapture..........................................              0           
  Capital gain (loss).......................................              0           
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................              0           
    Return of capital.......................................              0           
  Source (on cash basis):                                                             
    Sales...................................................              0           
    Refinancing.............................................              0           
    Operations..............................................              0           
    Other...................................................              0           
Amount remaining invested in program properties.............            100%          

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening through March 31, 2005 
PUBLIC OFFERINGS CLOSED DURING 2004 
BOSTON CAPITAL TAX CREDIT FUND V L.P. (SERIES 49) 

                                                        [Enlarge/Download Table]

                                                             For the Financial Statement
                                                               period ended March 31,   
                                                                        2005            
                                                             ---------------------------
                                                                                        
Gross Revenues..............................................             62,538         
Profit on sale of properties................................                  0         
Less:                                                                                   
  Losses from operating partnerships (1)....................                  0         
  Operating Expenses (3)....................................           (204,155)        
  Interest Expense..........................................                  0         
  Depreciation (2)..........................................                  0         
Net Income-GAAP Basis.......................................           (141,617)        
Taxable Income from operations (4)..........................             73,111         
  gain on sale..............................................                  0         
Cash generated from operations (6)..........................         (3,918,703)        
Cash generated from sales...................................                  0         
Cash generated from refinancing.............................                  0         
Cash generated from operations, sales and refinancing.......         (3,918,703)        
Less: Cash distributions to investors                                                   
  from operating cash flow..................................                  0         
  from sales and refinancing................................                  0         
  from other................................................                  0         
Cash generated (deficiency) after cash distributions........         (3,918,703)        
Less: Special items (not including sales and refinancing)                               
  (identify and quantify)...................................                  0         
Cash generated (deficiency) after cash distributions and                                
  special items.............................................         (3,918,703)        

                                                        [Enlarge/Download Table]

                                                             For the Tax Period ended 
Tax & Distribution Data                                            December 31,       
                                                                       2004           
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................              0           
  State Credit..............................................              0           
  Ordinary Income (loss)....................................              2           
    from operations.........................................              2           
    from recapture..........................................              0           
  Capital gain (loss).......................................              0           
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................              0           
    Return of capital.......................................              0           
  Source (on cash basis):                                                             
    Sales...................................................              0           
    Refinancing.............................................              0           
    Operations..............................................              0           
    Other...................................................              0           
Amount remaining invested in program properties.............            100%          

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2000
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XV, A LP 

                                                        [Enlarge/Download Table]

                                                       For the Financial Statement                        
                                                         period ended March 31,                           
                                  2000        2001         2002         2003         2004         2005    
                                --------   ----------   ----------   ----------   ----------   ---------- 
                                                                                                          
Gross Revenues................       164      254,908      226,841      110,349       50,473       52,669 
Profit on sale of                                                                                         
  properties..................         0            0            0            0            0            0 
Less:                                                                                                     
  Losses from operating                                                                                   
    partnerships (1)..........         0   (1,793,955)  (4,338,003)  (3,332,367)  (3,425,488)    (899,450)
  Operating Expenses (3)......  (112,719)  (1,408,005)    (449,343)    (398,039)    (386,970)    (895,055)
  Interest Expense............         0            0            0            0            0            0 
  Depreciation (2)............    (4,056)    (185,214)    (229,261)    (252,719)    (241,244)    (436,134)
Net Income--GAAP Basis........  (116,611)  (3,132,266)  (4,789,766)  (3,872,776)  (4,003,229)  (2,177,970)
Taxable Income from                                                                                       
  operations (4)..............         0   (2,542,980)  (5,270,561)  (5,900,138)  (6,451,233)  (6,134,686)
  gain on sale................         0            0            0            0            0            0 
Cash generated from                                                                                       
  operations (6)..............    49,967   (3,277,101)    (133,555)    (279,041)    (269,098)    (114,584)
Cash generated from sales.....         0            0            0            0            0    2,427,306 
Cash generated from                                                                                       
  refinancing.................         0            0            0            0            0            0 
Cash generated from                                                                                       
  operations, sales and                                                                                   
  refinancing.................    49,967   (3,277,101)    (133,555)    (279,041)    (269,098)   2,312,722 
Less: Cash distributions to                                                                               
  investors                                                                                               
  from operating cash flow....         0            0            0            0            0            0 
  from sales and                                                                                          
    refinancing...............         0            0            0            0            0            0 
  from other..................         0            0            0            0     (920,000)           0 
Cash generated (deficiency)                                                                               
  after cash distributions....    49,967   (3,277,101)    (133,555)    (279,041)  (1,189,098)   2,312,722 
Less: Special items (not                                                                                  
  including sales and                                                                                     
  refinancing) (identify and                                                                              
  quantify)...................         0            0            0            0            0            0 
Cash generated (deficiency)                                                                               
  after cash distributions and                                                                            
  special items...............    49,967   (3,277,101)    (133,555)    (279,041)  (1,189,098)   2,312,722 

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                     For the Tax period ended December 31,        
                                                       2000       2001       2002       2003       2004  
Per $1,000 invested (7)                              --------   --------   --------   --------   --------
                                                                                                         
Federal Income Tax Results                                                                               
  Federal Credit (5)................................    24         73         93           93        91  
  State Credit......................................     0          0          0            0         0  
  Ordinary Income (loss)............................   (38)       (80)       (89)         (97)      (95) 
    from operations.................................   (38)       (80)       (89)         (97)      (95) 
    from recapture..................................     0          0          0            0         0  
  Capital gain (loss)...............................     0          0          0            0         0  
Cash Distributions to investors:                                                                         
  Source (on GAAP basis):                                                                                
    Investment income...............................     0          0          0            0         0  
    Return of capital...............................     0          0          0      920,000         0  
  Source (on cash basis):                                                                                
    Sales...........................................     0          0          0            0         0  
    Refinancing.....................................     0          0          0            0         0  
    Operations......................................     0          0          0            0         0  
    Other...........................................     0          0          0            0         0  
Amount remaining invested in program properties.....                                              96.75% 

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2000
THE CALIFORNIA CORORATE TAX CREDIT FUND IV, A LP

                                                        [Enlarge/Download Table]

                                                      For the Financial Statement                         
                                                        period ended March 31,                            
                                 2000         2001         2002         2003         2004         2005    
                              ----------   ----------   ----------   ----------   ----------   ---------- 
                                                                                                          
Gross Revenues..............       5,212      714,840      525,756        6,399      143,341        3,637 
Profit on sale of                                                                                         
  properties................           0            0            0            0            0            0 
Less:                                                                                                     
  Losses from operating                                                                                   
    partnerships (1)........      (1,955)    (197,952)  (1,114,318)  (1,043,720)    (915,245)    (906,504)
  Operating Expenses (3)....    (874,189)    (471,565)    (164,677)    (142,726)    (147,622)    (139,570)
  Interest Expense..........           0            0            0            0            0            0 
  Depreciation (2)..........      (4,199)     (50,386)     (50,385)     (50,386)     (50,386)     (50,386)
Net Income--GAAP Basis......    (875,131)      (5,063)    (803,624)  (1,230,433)    (969,912)  (1,092,823)
Taxable Income from                                                                                       
  operations (4)............           0   (1,176,366)  (3,045,958)  (2,932,807)  (2,760,519)  (2,860,584)
  gain on sale..............           0            0            0            0            0            0 
Cash generated from                                                                                       
  operations (6)............  (1,472,091)    (133,442)      72,518      (17,376)     102,449      (11,549)
Cash generated from sales...           0            0            0            0            0            0 
Cash generated from                                                                                       
  refinancing...............           0            0            0            0            0            0 
Cash generated from                                                                                       
  operations, sales and                                                                                   
  refinancing...............  (1,472,091)    (133,442)      72,518      (17,376)     102,449      (11,549)
Less: Cash distributions to                                                                               
  investors                                                                                               
  from operating cash                                                                                     
    flow....................           0            0            0            0            0            0 
  from sales and                                                                                          
    refinancing.............           0            0            0            0            0            0 
  from other................           0     (190,000)    (150,000)           0            0            0 
Cash generated (deficiency)                                                                               
  after cash                                                                                              
  distributions.............  (1,472,091)    (323,442)     (77,482)     (17,376)     102,449      (11,549)
Less: Special items (not                                                                                  
  including sales and                                                                                     
  refinancing) (identify and                                                                              
  quantify).................           0            0            0            0            0            0 
Cash generated (deficiency)                                                                               
  after cash distributions                                                                                
  and special items.........  (1,472,091)    (323,442)     (77,482)     (17,376)     102,449      (11,549)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                  For the Tax period ended December 31,        
                                                    2000       2001       2002       2003       2004  
Per $1,000 invested (7)                           --------   --------   --------   --------   --------
                                                                                                      
Federal Income Tax Results                                                                            
  Federal Credit (5).............................       1         58        83         83         83  
  State Credit...................................       1          1         1          0          0  
  Ordinary Income (loss).........................     (40)      (113)     (108)      (102)      (106) 
    from operations..............................     (40)      (113)     (108)      (102)      (106) 
    from recapture...............................       0          0         0          0          0  
  Capital gain (loss)............................       0          0         0          0          0  
Cash Distributions to investors:                                                                      
  Source (on GAAP basis)                                                                              
    Investment income............................       0          0         0          0          0  
    Return of capital............................ 190,000    150,000         0          0          0  
  Source (on cash basis):                                                                             
    Sales........................................       0          0         0          0          0  
    Refinancing..................................       0          0         0          0          0  
    Operations...................................       0          0         0          0          0  
    Other........................................       0          0         0          0          0  

                                                                [Download Table]
                                                        
Amount remaining invested in program                    
  properties..................................... 99.21%

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2000
THE CALIFORNIA CORORATE TAX CREDIT FUND VI, A LP

                                                        [Enlarge/Download Table]

                                                            For the Financial Statement              
                                                               Period ended March 31,                
                                                   2001      2002       2003       2004       2005   
                                                 --------  --------   --------   --------   -------- 
                                                                                                     
Gross Revenues..................................     949     57,429      2,323      1,949      4,264 
Profit on sale of properties....................       0          0          0          0          0 
Less:                                                                                                
  Losses from operating partnerships (1)........  (4,857)   (63,653)  (256,117)  (307,969)  (315,256)
  Operating Expenses (3)........................ (49,257)  (227,899)   (58,081)   (59,741)   (58,158)
  Interest Expense..............................       0          0          0          0          0 
  Depreciation (2)..............................  (2,394)   (24,123)   (35,813)   (35,830)   (17,916)
Net Income--GAAP Basis.......................... (55,559)  (258,246)  (347,688)  (401,591)  (387,066)
Taxable Income                                                                                       
  from operations (4)...........................  (1,672)  (206,420)  (519,398)  (545,201)  (503,644)
  gain on sale..................................       0          0          0          0          0 
Cash generated from operations (6)..............  43,327   (391,070)   (41,439)        46    (87,900)
Cash generated from sales.......................       0          0          0          0          0 
Cash generated from refinancing.................       0          0          0          0          0 
Cash generated from operations, sales and                                                            
  refinancing...................................  43,327   (391,070)   (41,439)        46    (87,900)
Less: Cash distributions to investors                                                                
  from operating cash flow......................       0          0          0          0          0 
  from sales and refinancing....................       0          0          0          0          0 
  from other....................................       0          0          0          0          0 
Cash generated (deficiency) after cash                                                               
  distributions.................................  43,327   (391,070)   (41,439)        46    (87,900)
Less: Special items (not including sales and                                                         
  refinancing) (identify and quantify)..........       0          0          0          0          0 
Cash generated (deficiency) after cash                                                               
  distributions and special items...............  43,327   (391,070)   (41,439)        46    (87,900)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                       For the Tax period ended December 31,          
                                                       2000        2001        2002        2003        2004  
Per $1,000 invested (7)                              --------    --------    --------    --------    --------
                                                                                                             
Federal Income Tax Results                                                                                   
  Federal Credit (5)................................     0          36          84          82           82  
  State Credit......................................     0           0           0           0            0  
  Ordinary Income (loss)............................    (1)        (22)        (54)        (57)         (52) 
    from operations.................................    (1)        (22)        (54)        (57)         (52) 
    from recapture..................................     0           0           0           0            0  
  Capital gain (loss)...............................     0           0           0           0            0  
Cash Distributions to investors:                                                                             
  Source (on GAAP basis)                                                                                     
    Investment income...............................     0           0           0           0            0  
    Return of capital...............................     0           0           0           0            0  
  Source (on cash basis):                                                                                    
    Sales...........................................     0           0           0           0            0  
    Refinancing.....................................     0           0           0           0            0  
    Operations......................................     0           0           0           0            0  
    Other...........................................     0           0           0           0            0  
Amount remaining invested in program properties.....                                                  99.40% 

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2000
THE TEXAS CORORATE TAX CREDIT FUND, A LP

                                                        [Enlarge/Download Table]

                                                       For the Financial Statement                        
                                                         period ended March 31,                           
                                  2000        2001         2002         2003         2004         2005    
                                --------   ----------   ----------   ----------   ----------   ---------- 
                                                                                                          
Gross Revenues................         0      446,639       37,289        5,283       72,875       22,581 
Profit on sale of                                                                                         
  properties..................         0            0            0            0            0              
Less:                                                                                                     
  Losses from operating                                                                                   
    partnerships (1)..........      (319)    (325,538)  (1,459,489)  (1,272,326)  (1,068,124)  (1,327,587)
  Operating Expenses (3)......  (123,803)    (950,749)    (172,784)    (170,971)    (162,586)    (147,565)
  Interest Expense............         0            0            0            0            0            0 
  Depreciation (2)............      (753)     (45,474)     (85,851)     (90,110)     (90,110)     (90,110)
Net Income--GAAP Basis........  (124,875)    (875,122)  (1,680,835)  (1,528,124)  (1,247,945)  (1,542,681)
Taxable Income                                                                                            
  from operations (4).........         0     (900,264)  (3,779,740)  (3,875,724)  (3,187,272)  (3,173,542)
  gain on sale................         0            0            0            0            0            0 
Cash generated from                                                                                       
  operations (6)..............  (280,708)    (327,117)    (945,052)    (153,265)     (48,865)     (36,376)
Cash generated from sales.....         0            0            0            0            0            0 
Cash generated from                                                                                       
  refinancing.................         0            0            0            0            0            0 
Cash generated from                                                                                       
  operations, sales and                                                                                   
  refinancing.................  (280,708)    (327,117)    (945,052)    (153,265)     (48,865)     (36,376)
Less: Cash distributions to                                                                               
  investors                                                                                               
  from operating cash flow....         0            0            0            0            0            0 
  from sales and                                                                                          
    refinancing...............         0            0            0            0            0            0 
  from other..................         0            0            0            0            0            0 
Cash generated (deficiency)                                                                               
  after cash distributions....  (280,708)    (327,117)    (945,052)    (153,265)     (48,865)     (36,376)
Less: Special items (not                                                                                  
  including sales and                                                                                     
  refinancing) (identify and                                                                              
  quantify)...................         0            0            0            0            0            0 
Cash generated (deficiency)                                                                               
  after cash distributions and                                                                            
  special items...............  (280,708)    (327,117)    (945,052)    (153,265)     (48,865)     (36,376)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                       For the Tax period ended December 31,          
                                                       2000        2001        2002        2003        2004  
Per $1,000 invested (7)                              --------    --------    --------    --------    --------
                                                                                                             
Federal Income Tax Results                                                                                   
  Federal Credit (5)................................      0          57          84          86          86  
  State Credit......................................      0           0           0           0           0  
  Ordinary Income (loss)............................    (30)       (126)       (130)       (107)       (106) 
    from operations.................................    (30)       (126)       (130)       (107)       (106) 
    from recapture..................................      0           0           0           0           0  
  Capital gain (loss)...............................      0           0           0           0           0  
Cash Distributions to investors:                                                                             
  Source (on GAAP basis)                                                                                     
    Investment income...............................      0           0           0           0           0  
    Return of capital...............................      0           0           0           0           0  
  Source (on cash basis):                                                                                    
    Sales...........................................      0           0           0           0           0  
    Refinancing.....................................      0           0           0           0           0  
    Operations......................................      0           0           0           0           0  
    Other...........................................      0           0           0           0           0  
Amount remaining invested in program properties.....                                                  99.48% 

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2000
THE GEORGIA CORORATE TAX CREDIT FUND, A LP

                                                        [Enlarge/Download Table]

                                                         For the Financial Statement                   
                                                            period ended March 31,                     
                                           2001         2002         2003         2004         2005    
                                        ----------   ----------   ----------   ----------   ---------- 
                                                                                                       
Gross Revenues.........................     24,180      152,434       52,703       32,022       31,588 
Profit on sale of properties...........          0            0            0            0            0 
Less:                                                                                                  
  Losses from operating                                                                                
    partnerships (1)...................    (77,768)  (1,644,209)  (1,482,141)    (945,917)    (953,902)
  Operating Expenses (3)...............   (813,177)    (214,768)    (225,920)    (148,181)    (195,646)
  Interest Expense.....................          0            0            0            0            0 
  Depreciation (2).....................    (35,974)     (96,149)    (115,438)    (126,242)    (126,241)
Net Income--GAAP Basis.................   (902,739)  (1,802,692)  (1,770,796)  (1,188,318)  (1,244,201)
Taxable Income                                                                                         
  from operations (4)..................   (920,404)  (4,106,056)  (5,301,064)  (4,390,696)  (4,188,116)
  gain on sale.........................          0            0            0            0            0 
Cash generated from operations (6)..... (1,551,499)     (55,734)     (25,284)      56,694       56,102 
Cash generated from sales..............          0            0            0            0            0 
Cash generated from refinancing........          0            0            0            0            0 
Cash generated from operations, sales                                                                  
  and refinancing...................... (1,551,499)     (55,734)     (25,284)      56,694       56,102 
Less: Cash distributions to investors                                                                  
  from operating cash flow.............          0            0            0            0            0 
  from sales and refinancing...........          0            0            0            0            0 
  from other...........................          0            0     (241,732)    (800,000)           0 
Cash generated (deficiency) after cash                                                                 
  distributions........................ (1,551,499)     (55,734)    (267,016)    (743,306)      56,102 
Less: Special items (not including                                                                     
  sales and refinancing) (identify and                                                                 
  quantify)............................          0            0            0            0            0 
Cash generated (deficiency) after cash                                                                 
  distributions and special items...... (1,551,499)     (55,734)    (267,016)    (743,306)      56,102 

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                  For the Tax period ended December 31,        
                                                    2000       2001       2002       2003       2004  
Per $1,000 invested(7)                            --------   --------   --------   --------   --------
                                                                                                      
Federal Income Tax Results                                                                            
  Federal Credit (5).............................      0         11          50         57        57  
  State Credit...................................      0          1          65         87        87  
  Ordinary Income (loss).........................    (17)      (118)       (152)      (126)     (120) 
    from operations..............................    (17)      (118)       (152)      (126)     (120) 
    from recapture...............................      0          0           0          0         0  
  Capital gain (loss)............................      0          0           0          0         0  
Cash Distributions to investors:                                                                      
  Source (on GAAP basis).........................      0                                              
    Investment income............................      0          0           0          0         0  
    Return of capital............................      0          0     241,732    800,000         0  
  Source (on cash basis):                                                                             
    Sales........................................      0          0           0          0         0  
    Refinancing..................................      0          0           0          0         0  
    Operations...................................      0          0           0          0         0  
    Other........................................      0          0           0          0         0  
Amount remaining invested in program                                                                  
  properties.....................................                                              96.23% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2000
DIRECT PLACEMENT OFFERINGS CLOSED DURING 2000 

                                                        [Enlarge/Download Table]

                                                       For the Financial Statement                        
                                                         period ended March 31,                           
                                  2000        2001         2002         2003         2004         2005    
                                --------   ----------   ----------   ----------   ----------   ---------- 
                                                                                                          
Gross Revenues................        40       25,202      129,837       92,643       86,311      178,338 
Profit on sale of                                                                                         
  properties..................         0            0            0            0            0            0 
Less:                                                                                                     
  Losses from operating                                                                                   
    partnerships (1)..........         0     (126,312)    (951,964)  (4,911,624)  (4,882,837)  (4,864,013)
  Operating Expenses (3)......   (45,238)    (543,787)    (792,466)  (1,075,289)  (1,055,379)  (1,873,649)
  Interest Expense............         0            0            0            0            0            0 
  Depreciation (2)............    (1,415)     (61,725)    (238,610)    (344,858)    (429,148)    (477,501)
Net Income--GAAP Basis........   (46,613)    (706,622)  (1,853,203)  (6,239,128)  (6,281,053)  (7,036,825)
Taxable Income                                                                                            
  from operations (4).........         0     (331,449)  (1,653,483)  (6,343,762)  (7,963,564)  (7,798,033)
  gain on sale................         0            0            0            0            0            0 
Cash generated from                                                                                       
  operations (6)..............  (145,733)  (1,456,099)  (1,622,442)  (1,488,972)    (127,225)  (1,320,401)
Cash generated from sales.....         0            0            0            0            0            0 
Cash generated from                                                                                       
  refinancing.................         0            0            0            0            0            0 
Cash generated from                                                                                       
  operations, sales and                                                                                   
  refinancing.................  (145,733)  (1,456,099)  (1,622,442)  (1,488,972)    (127,225)  (1,320,401)
Less: Cash distributions to                                                                               
  investors                                                                                               
  from operating cash flow....         0            0            0            0            0            0 
  from sales and                                                                                          
    refinancing...............         0            0            0            0            0            0 
  from other..................         0            0            0     (242,407)     (35,383)           0 
Cash generated (deficiency)                                                                               
  after cash distributions....  (145,733)  (1,456,099)  (1,622,442)  (1,731,379)    (162,608)  (1,320,401)
Less: Special items (not                                                                                  
  including sales and                                                                                     
  refinancing) (identify and                                                                              
  quantify)...................         0            0            0            0            0            0 
Cash generated (deficiency)                                                                               
  after cash distributions and                                                                            
  special items...............  (145,733)  (1,456,099)  (1,622,442)  (1,731,379)    (162,608)  (1,320,401)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                  For the Tax period ended December 31,        
                                                    2000       2001       2002       2003       2004  
Per $1,000 invested (7)                           --------   --------   --------   --------   --------
                                                                                                      
Federal Income Tax Results                                                                            
  Federal Credit (5).............................      2        24           54        131        83  
  State Credit...................................      0         0           13         10        10  
  Ordinary Income (loss).........................    (10)      (27)         (58)       (55)      (52) 
    from operations..............................    (10)      (27)         (58)       (55)      (52) 
    from recapture...............................      0         0            0          0         0  
  Capital gain (loss)............................      0         0            0          0         0  
Cash Distributions to investors:                                                                      
  Source (on GAAP basis)                                                                              
    Investment income............................      0         0            0          0         0  
    Return of capital............................      0         0      242,407    118,489         0  
  Source (on cash basis):                                                                             
    Sales........................................      0         0            0          0         0  
    Refinancing..................................      0         0            0          0         0  
    Operations...................................      0         0            0          0         0  
    Other........................................      0         0            0          0         0  
Amount remaining invested in program                                                                  
  properties.....................................                                              99.48% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2001
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XVI, A LP

                                                        [Enlarge/Download Table]

                                                           For the Financial Statement                  
                                                             period ended March 31,                     
                                            2001        2002         2003         2004         2005     
                                          --------   ----------   ----------   ----------   ----------- 
                                                                                                        
Gross Revenues..........................         0      150,951      380,080       72,942        64,280 
Profit on sale of properties............         0            0            0            0             0 
Less:                                                                                                   
  Losses from operating                                                                                 
    partnerships (1)....................         0     (488,361)  (3,762,301)  (3,232,759)   (3,593,874)
  Operating Expenses (3)................  (138,744)  (1,224,698)    (438,638)    (449,838)     (353,775)
  Interest Expense......................         0            0            0            0             0 
  Depreciation (2)......................    (3,329)    (162,640)    (202,215)    (204,546)     (204,547)
Net Income--GAAP Basis..................  (142,073)  (1,724,748)  (4,023,074)  (3,814,201)   (4,087,916)
Taxable Income                                                                                          
  from operations (4)...................         0   (1,476,867)  (5,886,972)  (6,924,141)   (6,059,941)
  gain on sale..........................         0            0            0            0             0 
Cash generated from operations (6)......  (518,583)  (2,329,774)     599,378     (498,750)     (432,831)
Cash generated from sales...............         0            0            0            0             0 
Cash generated from refinancing.........         0            0            0            0             0 
Cash generated from operations, sales                                                                   
  and refinancing.......................  (518,583)  (2,329,774)     599,378     (498,750)     (432,831)
Less: Cash distributions to investors                                                                   
  from operating cash flow..............         0            0            0            0             0 
  from sales and refinancing............         0            0            0            0             0 
  from other............................         0            0     (147,151)    (123,455)      (67,968)
Cash generated (deficiency) after cash                                                                  
  distributions.........................  (518,583)  (2,329,774)     452,227     (622,205)     (500,799)
Less: Special items (not including sales                                                                
  and refinancing) (identify and                                                                        
  quantify).............................         0            0            0            0             0 
Cash generated (deficiency) after cash                                                                  
  distributions and special items.......  (518,583)  (2,329,774)     452,227     (622,205)     (500,799)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                 For the Tax period ended December 31,       
                                                    2001          2002          2003          2004  
Per $1,000 invested (7)                           --------      --------      --------      --------
                                                                                                    
Federal Income Tax Results                                                                          
  Federal Credit (5).............................      8             47           83             89 
  State Credit...................................      0              0            0              0 
  Ordinary Income (loss).........................    (23)           (91)        (106)           (93)
    from operations..............................    (23)           (91)        (106)           (93)
    from recapture...............................      0              0            0              0 
  Capital gain (loss)............................      0              0            0              0 
Cash Distributions to investors:                                                                    
  Source (on GAAP basis):                                                                           
    Investment income............................      0              0            0              0 
    Return of capital............................      0        147,151            0        123,455 
  Source (on cash basis):                                                                           
    Sales........................................      0              0            0              0 
    Refinancing..................................      0              0            0              0 
    Operations...................................      0              0            0              0 
    Other........................................      0              0            0              0 
Amount remaining invested in program                                                                
  properties.....................................                                             98.78%

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2001
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XVII, A LP 

                                                        [Enlarge/Download Table]

                                                              For the Financial Statement            
                                                                period ended March 31,               
                                                      2002         2003         2004         2005    
                                                   ----------   ----------   ----------   ---------- 
                                                                                                     
Gross Revenues....................................      6,835      188,818       91,719      111,624 
Profit on sale of properties......................          0            0            0            0 
Less:                                                                                                
  Losses from operating partnerships (1)..........    (64,176)  (1,885,256)  (3,441,219)  (2,974,825)
  Operating Expenses (3)..........................   (450,876)    (689,019)    (336,865)    (272,255)
  Interest Expense................................          0            0            0            0 
  Depreciation (2)................................    (27,110)    (169,500)    (167,120)    (167,152)
Net Income--GAAP Basis............................   (535,327)  (2,554,957)  (3,853,485)  (3,302,608)
Taxable Income                                                                                       
  from operations (4).............................    (99,027)  (3,763,282)  (4,841,234)  (5,433,021)
  gain on sale....................................          0            0            0            0 
Cash generated from operations (6)................ (1,416,294)  (1,136,789)    (209,145)    (208,119)
Cash generated from sales.........................          0            0            0            0 
Cash generated from refinancing...................          0            0            0            0 
Cash generated from operations, sales and                                                            
  refinancing..................................... (1,416,294)  (1,136,789)    (209,145)    (208,119)
Less: Cash distributions to investors                                                                
  from operating cash flow........................          0            0            0            0 
  from sales and refinancing......................          0            0            0            0 
  from other......................................          0            0      (75,256)           0 
Cash generated (deficiency) after cash                                                               
  distributions................................... (1,416,294)  (1,136,789)    (284,401)    (208,119)
Less: Special items (not including sales and                                                         
  refinancing) (identify and quantify)............          0            0            0            0 
Cash generated (deficiency) after cash                                                               
  distributions and special items................. (1,416,294)  (1,136,789)    (284,401)    (208,119)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                  For the Tax period ended December 31,          
                                                  2001            2002            2003            2004  
Per $1,000 Invested (7)                         --------        --------        --------        --------
                                                                                                        
Federal Income Tax Results                                                                              
  Federal Credit (5)...........................      1             13                69             89  
  State Credit.................................      0              0                 0              0  
  Ordinary Income (loss).......................    (16)           (67)              (93)          (104) 
    from operations............................    (16)           (67)              (93)          (104) 
    from recapture.............................      0              0                 0              0  
  Capital gain (loss)..........................      0              0                 0              0  
Cash Distributions to investors:                                                                        
  Source (on GAAP basis)                                                                                
    Investment income..........................      0              0                 0              0  
    Return of capital..........................      0              0            75,256              0  
  Source (on cash basis):                                                                               
    Sales......................................      0              0                 0              0  
    Refinancing................................      0              0                 0              0  
    Operations.................................      0              0                 0              0  
    Other......................................      0              0                 0              0  
Amount remaining invested in program                                                                    
  properties...................................                                                  98.11% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2001
THE CALIFORNIA CORORATE TAX CREDIT FUND V, A LP 

                                                        [Enlarge/Download Table]

                                                           For the Financial Statement                
                                                              period ended March 31,                  
                                                2001       2002         2003        2004       2005   
                                              --------  ----------   ----------   --------   -------- 
                                                                                                      
Gross Revenues...............................       0       69,655       65,142        957      1,446 
Profit on sale of properties.................       0            0            0          0          0 
Less:                                                                                                 
  Losses from operating partnerships (1).....       0     (915,470)    (922,292)  (810,080)  (864,497)
  Operating Expenses (3)..................... (13,046)    (127,188)     (93,715)  (102,981)  (103,648)
  Interest Expense...........................       0            0            0          0          0 
  Depreciation (2)...........................    (784)     (14,088)     (20,452)   (20,452)    (5,939)
Net Income--GAAP Basis....................... (13,830)    (987,091)    (971,317)  (932,556)  (972,638)
Taxable Income                                                                                        
  from operations (4)........................       0     (498,834)  (1,442,326)  (878,385)  (909,135)
  gain on sale...............................       0            0            0          0          0 
Cash generated from operations (6)........... (65,414)     (79,160)      (7,416)   (55,727)   (33,875)
Cash generated from sales....................       0            0            0          0          0 
Cash generated from refinancing..............       0            0            0          0          0 
Cash generated from operations, sales and                                                             
  refinancing................................ (65,414)     (79,160)      (7,416)   (55,727)   (33,875)
Less: Cash distributions to investors                                                                 
  from operating cash flow...................       0            0            0          0          0 
  from sales and refinancing.................       0            0            0          0          0 
  from other.................................       0            0     (268,284)         0          0 
Cash generated (deficiency) after cash                                                                
  distributions.............................. (65,414)     (79,160)    (275,700)   (55,727)   (33,875)
Less: Special items (not including sales and                                                          
  refinancing) (identify and quantify).......       0            0            0          0          0 
Cash generated (deficiency) after cash                                                                
  distributions and special items............ (65,414)     (79,160)    (275,700)   (55,727)   (33,875)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                    For the Tax period ended December 31,       
                                                       2001          2002          2003          2004  
Per $1,000 Invested (7)                              --------      --------      --------      --------
                                                                                                       
Federal Income Tax Results                                                                             
  Federal Credit (5)................................     27             65          66             66  
  State Credit......................................     70             81          75              5  
  Ordinary Income (loss)............................    (28)           (79)        (48)           (50) 
    from operations.................................    (28)           (79)        (48)           (50) 
    from recapture..................................      0              0           0              0  
  Capital gain (loss)...............................      0              0           0              0  
Cash Distributions to investors:                                                                       
  Source (on GAAP basis)............................      0                                            
    Investment income...............................      0              0           0              0  
    Return of capital...............................      0        268,284           0              0  
  Source (on cash basis):                                                                              
    Sales...........................................      0              0           0              0  
    Refinancing.....................................      0              0           0              0  
    Operations......................................      0              0           0              0  
    Other...........................................      0              0           0              0  
Amount remaining invested in program properties.....                                            98.60% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2001
THE GEORGIA CORPORATE TAX CREDIT FUND II, A LP

                                                        [Enlarge/Download Table]

                                                        For the Financial Statement           
                                                          period ended March 31,              
                                                2002        2003         2004         2005    
                                              --------   ----------   ----------   ---------- 
                                                                                              
Gross Revenues...............................    1,167        5,780        9,648       28,304 
Profit on sale of properties.................        0            0            0            0 
Less:                                                                                         
  Losses from operating partnerships (1).....        0   (1,233,869)  (3,146,168)  (1,448,246)
  Operating Expenses (3)..................... (122,105)    (578,368)    (173,580)    (100,848)
  Interest Expense...........................        0            0            0            0 
  Depreciation (2)...........................   (9,784)     (72,161)    (101,047)    (101,047)
Net Income--GAAP Basis....................... (130,722)  (1,878,618)  (3,411,147)  (1,621,837)
Taxable Income                                                                                
  from operations (4)........................  (15,786)  (1,359,982)  (3,264,693)  (2,025,248)
  gain on sale...............................        0            0            0            0 
Cash generated from operations (6)........... (161,016)  (1,209,307)    (172,155)    (102,628)
Cash generated from sales....................        0            0            0            0 
Cash generated from refinancing..............        0            0            0            0 
Cash generated from operations, sales and                                                     
  refinancing................................ (161,016)  (1,209,307)    (172,155)    (102,628)
Less: Cash distributions to investors                                                         
  from operating cash flow...................        0            0            0            0 
  from sales and refinancing.................        0            0            0            0 
  from other.................................        0     (228,237)           0            0 
Cash generated (deficiency) after cash                                                        
  distributions.............................. (161,016)  (1,437,544)    (172,155)    (102,628)
Less: Special items (not including sales and                                                  
  refinancing) (identify and quantify).......        0            0            0            0 
Cash generated (deficiency) after cash                                                        
  distributions and special items............ (161,016)  (1,437,544)    (172,155)    (102,628)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                    For the Tax period ended December 31,       
                                                       2001          2002          2003          2004  
Per $1,000 Invested (7)                              --------      --------      --------      --------
                                                                                                       
Federal Income Tax Results                                                                             
  Federal Credit (5)................................      0              2           38            49  
  State Credit......................................      0             18           67            94  
  Ordinary Income (loss)............................     (3)           (34)        (119)          (74) 
    from operations.................................     (3)           (34)        (119)          (74) 
    from recapture..................................      0              0            0             0  
  Capital gain (loss)...............................      0              0            0             0  
Cash Distributions to investors:                                                                       
  Source (on GAAP basis)............................      0                                            
    Investment income...............................      0              0            0             0  
    Return of capital...............................      0        228,237            0             0  
  Source (on cash basis):                                                                              
    Sales...........................................      0              0            0             0  
    Refinancing.....................................      0              0            0             0  
    Operations......................................      0              0            0             0  
    Other...........................................      0              0            0             0  
Amount remaining invested in program properties.....                                            98.73% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2001
BOSTON CAPITAL MID-ATLANTIC CORPORATE TAX CREDIT FUND, A LP 

                                                        [Enlarge/Download Table]

                                                                For the Financial Statement           
                                                                  period ended March 31,              
                                                        2002        2003         2004         2005    
                                                      --------   ----------   ----------   ---------- 
                                                                                                      
Gross Revenues......................................     4,260       57,622        5,578        1,869 
Profit on sale of properties........................         0            0            0            0 
Less:                                                                                                 
  Losses from operating partnerships (1)............   (22,157)  (1,694,104)    (940,252)    (936,801)
  Operating Expenses (3)............................  (227,874)     (73,508)     (71,497)     (53,168)
  Interest Expense..................................         0            0            0            0 
  Depreciation (2)..................................   (30,767)     (43,969)     (43,002)     (43,002)
Net Income--GAAP Basis..............................  (276,538)  (1,753,959)  (1,049,173)  (1,031,102)
Taxable Income                                                                                        
  from operations (4)...............................   (73,832)  (1,744,113)  (1,503,979)  (1,390,018)
  gain on sale......................................         0            0            0            0 
Cash generated from operations (6)..................  (863,771)     (30,451)     310,264       11,794 
Cash generated from sales...........................         0            0            0            0 
Cash generated from refinancing.....................         0            0            0            0 
Cash generated from operations, sales and                                                             
  refinancing.......................................  (863,771)     (30,451)     310,264       11,794 
Less: Cash distributions to investors                                                                 
  from operating cash flow..........................         0            0            0            0 
  from sales and refinancing........................         0            0            0            0 
  from other........................................         0   (1,664,008)           0      (85,118)
Cash generated (deficiency) after cash                                                                
  distributions.....................................  (863,771)  (1,694,459)     310,264      (73,324)
Less: Special items (not including sales and                                                          
  refinancing) (identify and quantify)..............         0            0            0            0 
Cash generated (deficiency) after cash distributions                                                  
  and special items.................................  (863,771)  (1,694,459)     310,264      (73,324)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                  For the Tax period ended December 31,       
                                                    2001          2002           2003          2004  
Per $1,000 Invested (7)                           --------      ---------      --------      --------
                                                                                                     
Federal Income Tax Results                                                                           
  Federal Credit (5).............................      0               50          90             90 
  State Credit...................................      0                0           0              0 
  Ordinary Income (loss).........................     (5)            (139)       (120)          (111)
    from operations..............................     (5)            (139)       (120)          (111)
    from recapture...............................      0                0           0              0 
  Capital gain (loss)............................      0                0           0              0 
Cash Distributions to investors:                                                                     
  Source (on GAAP basis).........................      0                                             
    Investment income............................      0                0           0              0 
    Return of capital............................      0        1,835,678           0         85,118 
  Source (on cash basis):                                                                            
    Sales........................................      0                0           0              0 
    Refinancing..................................      0                0           0              0 
    Operations...................................      0                0           0              0 
    Other........................................      0                0           0              0 
Amount remaining invested in program                                                                 
  properties.....................................                                              98.72%

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2001
DIRECT PLACEMENT OFFERINGS CLOSED DURING 2001 

                                                        [Enlarge/Download Table]

                                                           For the Financial Statement                  
                                                              period ended March 31,                    
                                             2001        2002         2003         2004         2005    
                                           --------   ----------   ----------   ----------   ---------- 
                                                                                                        
Gross Revenues...........................       565       49,231       75,629       71,614       17,599 
Profit on sale of properties.............         0            0            0            0            0 
Less:                                                                                                   
  Losses from operating                                                                                 
    partnerships (1).....................         0      (49,647)    (646,592)  (1,022,687)  (1,410,292)
  Operating Expenses (3).................  (160,709)     (99,719)    (340,885)    (172,157)    (132,084)
  Interest Expense.......................         0            0            0            0            0 
  Depreciation (2).......................    (2,730)     (35,533)     (65,135)     (71,690)     (71,677)
Net Income--GAAP Basis...................  (162,874)    (135,668)    (976,983)  (1,194,920)  (1,596,454)
Taxable Income                                                                                          
  from operations (4)....................         0     (414,305)  (1,634,174)  (2,152,171)  (1,852,839)
  gain on sale...........................         0            0            0            0            0 
Cash generated from operations (6).......  (351,600)    (138,393)    (523,623)     (23,088)     (37,913)
Cash generated from sales................         0            0            0            0            0 
Cash generated from refinancing..........         0            0            0            0            0 
Cash generated from operations, sales and                                                               
  refinancing............................  (351,600)    (138,393)    (523,623)     (23,088)     (37,913)
Less: Cash distributions to investors                                                                   
  from operating cash flow...............         0            0            0            0            0 
  from sales and refinancing.............         0            0            0            0            0 
  from other.............................         0            0            0            0     (122,462)
Cash generated (deficiency) after cash                                                                  
  distributions..........................  (351,600)    (138,393)    (523,623)     (23,088)    (160,375)
Less: Special items (not including sales                                                                
  and refinancing) (identify and                                                                        
  quantify)..............................         0            0            0            0            0 
Cash generated (deficiency) after cash                                                                  
  distributions and special items........  (351,600)    (138,393)    (523,623)     (23,088)    (160,375)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                    For the Tax period ended December 31,       
                                                       2001          2002          2003          2004  
Per $1,000 Invested (7)                              --------      --------      --------      --------
                                                                                                       
Federal Income Tax Results                                                                             
  Federal Credit (5)................................     12           75            55              84 
  State Credit......................................      0            0             0               0 
  Ordinary Income (loss)............................    (32)         (71)          (99)            (81)
    from operations.................................    (32)         (71)          (99)            (81)
    from recapture..................................      0            0             0               0 
  Capital gain (loss)...............................      0            0             0               0 
Cash Distributions to investors:                                                                       
  Source (on GAAP basis)                                                                               
    Investment income...............................      0            0             0               0 
    Return of capital...............................      0            0             0         122,462 
  Source (on cash basis):                                                                              
    Sales...........................................      0            0             0               0 
    Refinancing.....................................      0            0             0               0 
    Operations......................................      0            0             0               0 
    Other...........................................      0            0             0               0 
Amount remaining invested in program properties.....                                             99.09%

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2002
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XVIII, A LP

                                                        [Enlarge/Download Table]

                                                             For the Financial Statement      
                                                               period ended March 31,         
                                                           2003         2004         2005     
                                                        ----------   ----------   ----------- 
                                                                                              
Gross Revenues.........................................    120,918      610,441       202,579 
Profit on sale of properties...........................          0            0             0 
Less:                                                                                         
  Losses from operating partnerships (1)...............   (380,830)  (4,603,196)   (6,523,104)
  Operating Expenses (3)............................... (1,009,290)  (1,757,155)     (776,576)
  Interest Expense.....................................          0            0             0 
  Depreciation (2).....................................    (81,089)    (407,636)     (405,886)
Net Income--GAAP Basis................................. (1,350,291)  (6,157,546)   (7,502,987)
Taxable Income                                                                                
  from operations (4)..................................   (631,738)  (7,458,357)  (10,425,164)
  gain on sale.........................................          0            0             0 
Cash generated from operations (6).....................   (288,330)  (4,960,169)     (321,153)
Cash generated from sales..............................          0            0             0 
Cash generated from refinancing........................          0            0             0 
Cash generated from operations, sales and                                                     
  refinancing..........................................   (288,330)  (4,960,169)     (321,153)
Less: Cash distributions to investors                                                         
  from operating cash flow.............................          0            0             0 
  from sales and refinancing...........................          0            0             0 
  from other...........................................   (372,964)           0      (148,770)
Cash generated (deficiency) after cash distributions...   (661,294)  (4,960,169)     (469,923)
Less: Special items (not including sales and                                                  
  refinancing) (identify and quantify).................          0            0             0 
Cash generated (deficiency) after cash distributions                                          
  and special items....................................   (661,294)  (4,960,169)     (469,923)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                             For the Tax period ended December 31,      
                                                 2002                2003                2004  
Per $1,000 Invested (7)                        --------            --------            --------
                                                                                               
Federal Income Tax Results                                                                     
  Federal Credit (5)..........................       1                  44                  75 
  State Credit................................       0                   0                   0 
  Ordinary Income (loss)......................      (7)                (59)                (83)
    from operations...........................      (7)                (59)                (83)
    from recapture............................       0                   0                   0 
  Capital gain (loss).........................       0                   0                   0 
Cash Distributions to investors:                                                               
  Source (on GAAP basis):                                                                      
    Investment income.........................       0                   0                   0 
    Return of capital.........................       0             372,964             148,770 
  Source (on cash basis):                                                                      
    Sales.....................................       0                   0                   0 
    Refinancing...............................       0                   0                   0 
    Operations................................       0                   0                   0 
    Other.....................................       0                   0                   0 
Amount remaining invested in program                                                           
  properties..................................                                           97.56%

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2002
DIRECT PLACEMENT OFFERINGS CLOSED DURING 2002 

                                                        [Enlarge/Download Table]

                                                              For the Financial Statement            
                                                                 period ended March 31,              
                                                      2002        2003         2004         2005     
                                                    --------   ----------   ----------   ----------- 
                                                                                                     
Gross Revenues.....................................      127       13,989       20,902       127,840 
Profit on sale of properties.......................        0            0            0             0 
Less:                                                                                                
  Losses from operating partnerships (1)...........        0     (828,043)  (4,181,654)   (8,079,420)
  Operating Expenses (3)...........................  (43,466)  (1,007,254)    (752,897)   (1,331,327)
  Interest Expense.................................        0            0            0      (505,985)
  Depreciation (2).................................   (3,169)    (110,803)    (178,314)     (264,989)
Net Income--GAAP Basis.............................  (46,508)  (1,932,111)  (5,091,963)  (10,053,881)
Taxable Income                                                                                       
  from operations (4)..............................        0   (1,296,288)  (4,880,886)   (9,700,220)
  gain on sale.....................................        0            0            0             0 
Cash generated from operations (6)................. (208,978)  (2,046,776)    (811,618)   (1,190,867)
Cash generated from sales..........................        0            0            0             0 
Cash generated from refinancing....................        0            0            0             0 
Cash generated from operations, sales and                                                            
  refinancing...................................... (208,978)  (2,046,776)    (811,618)   (1,190,867)
Less: Cash distributions to investors                                                                
  from operating cash flow.........................        0            0            0             0 
  from sales and refinancing.......................        0            0            0             0 
  from other.......................................        0            0     (144,302)     (166,536)
Cash generated (deficiency) after cash                                                               
  distributions.................................... (208,978)  (2,046,776)    (955,920)   (1,357,403)
Less: Special items (not including sales and                                                         
  refinancing) (identify and quantify).............        0            0            0             0 
Cash generated (deficiency) after cash                                                               
  distributions and special items.................. (208,978)  (2,046,776)    (955,920)   (1,357,403)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                For the Tax period ended December 31,      
                                                    2002                2003                2004  
Per $1,000 Invested (7)                           --------            --------            --------
                                                                                                  
Federal Income Tax Results                                                                        
  Federal Credit (5).............................     10                   39                  60 
  State Credit...................................      0                    0                   4 
  Ordinary Income (loss).........................    (27)                 (56)                (71)
    from operations..............................    (27)                 (56)                (71)
    from recapture...............................      0                    0                   0 
  Capital gain (loss)............................      0                    0                   0 
Cash Distributions to investors:                                                                  
  Source (on GAAP basis)                                                                          
    Investment income............................      0                    0                   0 
    Return of capital............................      0              144,302              98,338 
  Source (on cash basis):                                                                         
    Sales........................................      0                    0                   0 
    Refinancing..................................      0                    0                   0 
    Operations...................................      0                    0                   0 
    Other........................................      0                    0                   0 
Amount remaining invested in program                                                              
  properties.....................................                                           99.81%

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2003
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XIX, A LP

                                                        [Enlarge/Download Table]

                                                                For the Financial    
                                                                Statement period     
                                                                 ended March 31,     
                                                                2004         2005    
                                                             ----------   ---------- 
                                                                                     
Gross Revenues..............................................      6,484       34,650 
Profit on sale of properties................................          0            0 
Less:                                                                                
  Losses from operating partnerships (1)....................    (24,658)  (2,886,148)
  Operating Expenses (3).................................... (1,906,760)    (518,422)
  Interest Expense..........................................          0            0 
  Depreciation (2)..........................................   (124,350)    (327,990)
Net Income--GAAP Basis...................................... (2,049,284)  (3,697,910)
Taxable Income                                                                       
  from operations (4).......................................   (539,612)  (7,393,682)
  gain on sale..............................................          0            0 
Cash generated from operations (6).......................... (4,017,260)    (587,781)
Cash generated from sales...................................          0            0 
Cash generated from refinancing.............................          0            0 
Cash generated from operations, sales and refinancing....... (4,017,260)    (587,781)
Less: Cash distributions to investors                                                
  from operating cash flow..................................          0            0 
  from sales and refinancing................................          0            0 
  from other................................................          0            0 
Cash generated (deficiency) after cash distributions........ (4,017,260)    (587,781)
Less: Special items (not including sales and refinancing)                            
  (identify and quantify)...................................          0            0 
Cash generated (deficiency) after cash distributions and                             
  special items............................................. (4,017,260)    (587,781)

                                                        [Enlarge/Download Table]

                                                                   For the Tax       
                                                                   period ended      
Tax & Distribution Data                                            December 31,      
                                                               2003            2004  
Per $1,000 invested (7)                                      --------        --------
                                                                                     
Federal Income Tax Results                                                           
  Federal Credit (5)........................................     1               16  
  State Credit..............................................     0                0  
  Ordinary Income (loss)....................................    (6)             (78) 
    from operations.........................................    (6)             (78) 
    from recapture..........................................     0                0  
  Capital gain (loss).......................................     0                0  
Cash Distributions to investors:                                                     
  Source (on GAAP basis):                                                            
    Investment income.......................................     0                0  
    Return of capital.......................................     0                0  
  Source (on cash basis):                                                            
    Sales...................................................     0                0  
    Refinancing.............................................     0                0  
    Operations..............................................     0                0  
    Other...................................................     0                0  
Amount remaining invested in program properties.............                  99.87% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2003
DIRECT PLACEMENT OFFERINGS CLOSED DURING 2003 

                                                        [Enlarge/Download Table]

                                                              For the Financial Statement     
                                                                 period ended March 31,       
                                                             2003        2004         2005    
                                                           --------   ----------   ---------- 
                                                                                              
Gross Revenues............................................    1,536       94,859       33,745 
Profit on sale of properties..............................        0            0            0 
Less:                                                                                         
  Losses from operating partnerships (1)..................        0     (297,903)  (1,425,280)
  Operating Expenses (3)..................................  (76,606)    (523,877)    (402,561)
  Interest Expense........................................        0     (319,567)           0 
  Depreciation (2)........................................   (4,552)    (104,362)    (152,119)
Net Income--GAAP Basis....................................  (79,622)  (1,150,850)  (1,946,215)
Taxable Income                                                                                
  from operations (4).....................................        0     (867,081)  (3,291,915)
  gain on sale............................................        0            0            0 
Cash generated from operations (6)........................ (423,269)  (1,066,403)    (548,210)
Cash generated from sales.................................        0            0            0 
Cash generated from refinancing...........................        0            0            0 
Cash generated from operations, sales and refinancing..... (423,269)  (1,066,403)    (548,210)
Less: Cash distributions to investors                                                         
  from operating cash flow................................        0            0            0 
  from sales and refinancing..............................        0            0            0 
  from other..............................................        0            0            0 
Cash generated (deficiency) after cash distributions...... (423,269)  (1,066,403)    (548,210)
Less: Special items (not including sales and refinancing)                                     
  (identify and quantify).................................        0            0            0 
Cash generated (deficiency) after cash distributions and                                      
  special items........................................... (423,269)  (1,066,403)    (548,210)

                                                        [Enlarge/Download Table]

                                                                   For the Tax       
                                                                   period ended      
Tax & Distribution Data                                            December 31,      
                                                               2003            2004  
Per $1,000 invested (7)                                      --------        --------
                                                                                     
Federal Income Tax Results                                                           
  Federal Credit (5)........................................      2              27  
  State Credit..............................................      2              51  
  Ordinary Income (loss)....................................    (14)            (46) 
    from operations.........................................    (14)            (46) 
    from recapture..........................................      0               0  
  Capital gain (loss).......................................      0               0  
Cash Distributions to investors:                                                     
  Source (on GAAP basis)                                                             
    Investment income.......................................      0               0  
    Return of capital.......................................      0               0  
  Source (on cash basis):                                                            
    Sales...................................................      0               0  
    Refinancing.............................................      0               0  
    Operations..............................................      0               0  
    Other...................................................      0               0  
Amount remaining invested in program properties.............                  99.89% 

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2004
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XX, A LP 

                                                        [Enlarge/Download Table]

                                                                For the Financial    
                                                                Statement period     
                                                                 ended March 31,     
                                                             ----------------------- 
                                                                2004         2005    
                                                             ----------   ---------- 
                                                                                     
Gross Revenues                                                                       
Profit on sale of properties................................        739       38,889 
Less:.......................................................          0              
  Losses from operating partnerships (1)....................          0   (1,180,137)
  Operating Expenses (3)....................................   (337,179)    (477,306)
  Interest Expense..........................................          0            0 
  Depreciation (2)..........................................     (8,725)    (108,610)
Net Income--GAAP Basis......................................   (345,165)  (1,727,164)
Taxable Income                                                                       
  from operations (4).......................................          0   (1,794,687)
  gain on sale..............................................          0            0 
Cash generated from operations (6).......................... (1,174,157)    (444,185)
Cash generated from sales...................................          0            0 
Cash generated from refinancing.............................          0            0 
Cash generated from operations, sales and refinancing....... (1,174,157)    (444,185)
Less: Cash distributions to investors                                                
  from operating cash flow..................................          0            0 
  from sales and refinancing................................          0            0 
  from other................................................          0            0 
Cash generated (deficiency) after cash distributions........ (1,174,157)    (444,185)
Less: Special items (not including sales and refinancing)                            
  (identify and quantify)...................................          0            0 
Cash generated (deficiency) after cash distributions and                             
  special items............................................. (1,174,157)    (444,185)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                      For the Tax period ended 
                                                                 December 31, 2004    
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................               8          
  State Credit..............................................               0          
  Ordinary Income (loss)....................................             (61)         
    from operations.........................................             (61)         
    from recapture..........................................               0          
  Capital gain (loss).......................................               0          
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................               0          
    Return of capital.......................................               0          
  Source (on cash basis):                                                             
    Sales...................................................               0          
    Refinancing.............................................               0          
    Operations..............................................               0          
    Other...................................................               0          
Amount remaining invested in program properties.............          100.00%         

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2004
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XX-A, A LP 

                                                        [Enlarge/Download Table]

                                                                For the Financial    
                                                                Statement period     
                                                                 ended March 31,     
                                                             ----------------------- 
                                                                2004         2005    
                                                             ----------   ---------- 
                                                                                     
Gross Revenues                                                                       
Profit on sale of properties................................      7,995      189,835 
Less:.......................................................          0              
  Losses from operating partnerships (1)....................          0   (1,077,456)
  Operating Expenses (3)....................................   (591,957)    (844,845)
  Interest Expense..........................................          0            0 
  Depreciation (2)..........................................    (14,784)    (184,347)
Net Income--GAAP Basis......................................   (598,746)  (1,916,813)
Taxable Income                                                                       
  from operations (4).......................................          0   (1,538,298)
  gain on sale..............................................          0            0 
Cash generated from operations (6).......................... (2,091,942)    (383,441)
Cash generated from sales...................................          0            0 
Cash generated from refinancing.............................          0            0 
Cash generated from operations, sales and refinancing....... (2,091,942)    (383,441)
Less: Cash distributions to investors                                                
  from operating cash flow..................................          0            0 
  from sales and refinancing................................          0            0 
  from other................................................          0            0 
Cash generated (deficiency) after cash distributions........ (2,091,942)    (383,441)
Less: Special items (not including sales and refinancing)                            
  (identify and quantify)...................................          0            0 
Cash generated (deficiency) after cash distributions and                             
  special items............................................. (2,091,942)    (383,441)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                      For the Tax period ended 
                                                                 December 31, 2004    
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................               7          
  State Credit..............................................               0          
  Ordinary Income (loss)....................................             (30)         
    from operations.........................................             (30)         
    from recapture..........................................               0          
  Capital gain (loss).......................................               0          
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................               0          
    Return of capital.......................................               0          
  Source (on cash basis):                                                             
    Sales...................................................               0          
    Refinancing.............................................               0          
    Operations..............................................               0          
    Other...................................................               0          
Amount remaining invested in program properties.............          100.00%         

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2004
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XXI, A LP

                                                                [Download Table]

                                                              For the Financial
                                                              Statement period 
                                                               ended March 31, 
                                                                    2005       
                                                              -----------------
                                                                               
Gross Revenues..............................................         80,397    
Profit on sale of properties................................                   
Less:                                                                          
  Losses from operating partnerships (1)....................     (2,276,983)   
  Operating Expenses (3)....................................     (2,634,703)   
  Interest Expense..........................................              0    
  Depreciation (2)..........................................       (348,339)   
Net Income--GAAP Basis......................................     (5,179,628)   
Taxable Income                                                                 
  from operations (4).......................................       (474,821)   
  gain on sale..............................................              0    
Cash generated from operations (6)..........................     (6,876,239)   
Cash generated from sales...................................              0    
Cash generated from refinancing.............................              0    
Cash generated from operations, sales and refinancing.......     (6,876,239)   
Less: Cash distributions to investors                                          
  from operating cash flow..................................              0    
  from sales and refinancing................................              0    
  from other................................................              0    
Cash generated (deficiency) after cash distributions........     (6,876,239)   
Less: Special items (not including sales and refinancing)                      
  (identify and quantify)...................................              0    
Cash generated (deficiency) after cash distributions and                       
  special items.............................................     (6,876,239)   

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                      For the Tax period ended 
                                                                 December 31, 2004    
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................               4          
  State Credit..............................................               0          
  Ordinary Income (loss)....................................              (5)         
    from operations.........................................              (5)         
    from recapture..........................................               0          
  Capital gain (loss).......................................               0          
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................               0          
    Return of capital.......................................               0          
  Source (on cash basis):                                                             
    Sales...................................................               0          
    Refinancing.............................................               0          
    Operations..............................................               0          
    Other...................................................               0          
Amount remaining invested in program properties.............          100.00%         

Boston Capital Corporate Tax Credit Fund XXI had not commenced operations as of 
March 31, 2004, therefore, it does not have audited Financial Statement         
information to report.                                                          

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OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2004
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XXII, A LP 

                                                                [Download Table]

                                                              For the Financial
                                                              Statement period 
                                                               ended March 31, 
                                                                    2005       
                                                              -----------------
                                                                               
Gross Revenues..............................................         61,532    
Profit on sale of properties................................              0    
Less:                                                                          
  Losses from operating partnerships (1)....................        (23,414)   
  Operating Expenses (3)....................................       (527,583)   
  Interest Expense..........................................              0    
  Depreciation (2)..........................................       (120,538)   
Net Income--GAAP Basis......................................       (610,003)   
Taxable Income                                                                 
  from operations (4).......................................        (51,932)   
  gain on sale..............................................              0    
Cash generated from operations (6)..........................     (3,437,726)   
Cash generated from sales...................................              0    
Cash generated from refinancing.............................              0    
Cash generated from operations, sales and refinancing.......     (3,437,726)   
Less: Cash distributions to investors                                          
  from operating cash flow..................................              0    
  from sales and refinancing................................              0    
  from other................................................              0    
Cash generated (deficiency) after cash distributions........     (3,437,726)   
Less: Special items (not including sales and refinancing)                      
  (identify and quantify)...................................              0    
Cash generated (deficiency) after cash distributions and                       
  special items.............................................     (3,437,726)   

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                      For the Tax period ended 
                                                                 December 31, 2004    
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................               0          
  State Credit..............................................               0          
  Ordinary Income (loss)....................................              (1)         
    from operations.........................................              (1)         
    from recapture..........................................               0          
  Capital gain (loss).......................................               0          
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................               0          
    Return of capital.......................................               0          
  Source (on cash basis):                                                             
    Sales...................................................               0          
    Refinancing.............................................               0          
    Operations..............................................               0          
    Other...................................................               0          
Amount remaining invested in program properties.............          100.00%         

Boston Capital Corporate Tax Credit Fund XXII had not commenced operations as of
March 31, 2004, therefore, it does not have audited Financial Statement         
information to report.                                                          

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2004
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XXIII, A LP

                                                                [Download Table]

                                                              For the Financial
                                                              Statement period 
                                                               ended March 31, 
                                                                    2005       
                                                              -----------------
                                                                               
Gross Revenues..............................................              0    
Profit on sale of properties................................              0    
Less:                                                                          
  Losses from operating partnerships (1)....................              0    
  Operating Expenses (3)....................................       (100,907)   
  Interest Expense..........................................              0    
  Depreciation (2)..........................................         (7,606)   
Net Income--GAAP Basis......................................       (108,513)   
Taxable Income from operations (4)                                             
  gain on sale..............................................              0    
Cash generated from operations (6)..........................      1,089,121    
Cash generated from sales...................................              0    
Cash generated from refinancing.............................              0    
Cash generated from operations, sales and refinancing.......      1,089,121    
Less: Cash distributions to investors                                          
  from operating cash flow..................................              0    
  from sales and refinancing................................              0    
  from other................................................              0    
Cash generated (deficiency) after cash distributions........      1,089,121    
Less: Special items (not including sales and refinancing)                      
  (identify and quantify)...................................              0    
Cash generated (deficiency) after cash distributions and                       
  special items.............................................      1,089,121    

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2004
BOSTON CAPITAL CORPORATE TAX CREDIT FUND XXIII-A, A LP

                                                                [Download Table]

                                                              For the Financial
                                                              Statement period 
                                                               ended March 31, 
                                                                    2005       
                                                              -----------------
                                                                               
Gross Revenues..............................................              0    
Profit on sale of properties................................              0    
Less:                                                                          
  Losses from operating partnerships (1)....................              0    
  Operating Expenses (3)....................................       (105,195)   
  Interest Expense..........................................              0    
  Depreciation (2)..........................................         (7,979)   
Net Income-GAAP Basis.......................................       (113,174)   
Taxable Income from operations (4)                                             
  gain on sale..............................................              0    
Cash generated from operations (6)..........................      2,947,749    
Cash generated from sales...................................              0    
Cash generated from refinancing.............................              0    
Cash generated from operations, sales and refinancing.......      2,947,749    
Less: Cash distributions to investors                                          
  from operating cash flow..................................              0    
  from sales and refinancing................................              0    
  from other................................................              0    
Cash generated (deficiency) after cash distributions........      2,947,749    
Less: Special items (not including sales and refinancing)                      
  (identify and quantify)...................................              0    
Cash generated (deficiency) after cash distributions and                       
  special items.............................................      2,947,749    

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TABLE III 
OPERATING RESULTS OF PRIOR LIMITED PARTNERSHIPS 
From Opening Through March 31, 2005 
CORPORATE OFFERINGS CLOSED DURING 2004
DIRECT PLACEMENT OFFERINGS CLOSED DURING 2004 

                                                                [Download Table]

                                                               For the Financial  
                                                               Statement period   
                                                                ended March 31,   
                                                               2004        2005   
                                                             ---------   ---------
                                                                                  
Gross Revenues..............................................      460       5,921 
Profit on sale of properties................................        0           0 
Less:.......................................................        0             
  Losses from operating partnerships (1)....................        0     (42,953)
  Operating Expenses (3).................................... (128,291)    (81,396)
  Interest Expense..........................................        0           0 
  Depreciation (2)..........................................   (4,937)    (24,109)
Net Income--GAAP Basis                                       (132,768)   (142,537)
Taxable Income from operations (4)..........................        0           0 
  gain on sale..............................................        0    (125,029)
Cash generated from operations (6).......................... (126,026)          0 
Cash generated from sales...................................        0    (225,595)
Cash generated from refinancing.............................        0           0 
Cash generated from operations, sales and refinancing....... (126,026)   (225,595)
Less: Cash distributions to investors.......................        0             
  from operating cash flow..................................        0           0 
  from sales and refinancing................................        0           0 
  from other................................................        0           0 
Cash generated (deficiency) after cash distributions........ (126,026)   (225,595)
Less: Special items (not including sales and refinancing)                         
  (identify and quantify)...................................        0           0 
Cash generated (deficiency) after cash distributions and                          
  special items............................................. (126,026)   (225,595)

                                                        [Enlarge/Download Table]

Tax & Distribution Data                                      For the Tax period ended 
                                                                 December 31, 2004    
Per $1,000 invested (7)                                      -------------------------
                                                                                      
Federal Income Tax Results                                                            
  Federal Credit (5)........................................               0          
  State Credit..............................................               8          
  Ordinary Income (loss)....................................             (13)         
    from operations.........................................             (13)         
    from recapture..........................................               0          
  Capital gain (loss).......................................               0          
Cash Distributions to investors:                                                      
  Source (on GAAP basis)                                                              
    Investment income.......................................               0          
    Return of capital.......................................               0          
  Source (on cash basis):                                                             
    Sales...................................................               0          
    Refinancing.............................................               0          
    Operations..............................................               0          
    Other...................................................               0          
Amount remaining invested in program properties.............          100.00%         

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NOTES TO TABLE III

Note 1: This figure represents the GAAP income (loss) allocable to the public   
investment partnerships from their investment in operating partnerships. The    
GAAP income (loss) is gross rental income less ordinary operating expenses,     
interest expense, depreciation and certain non-recurring fees, such as loan     
guarantee fees, lease-up fees and partnership management fees paid by the       
operating partnerships.                                                         

Note 2: This figure represents amortization of one or more of the following     
costs; acquisitions costs which are amortized over the expected life of the     
buildings; partnership management fees which are amortized over the expected    
life of the fund; and investor service fees which are amortized over the        
expected number of years to service collection of investor installments. Public 
funds only incur acquisitions costs, while corporate funds incur acquisition    
costs, partnership management fees and investor service fees.                   

Note 3: Operating expenses consist of investor service costs and legal and      
accounting fees of the investment partnerships and expenses paid from equity    
which includes partnership management fees, initial investor service fees and   
capital commitment fees reported on an accrual basis.                           

Note 4: The taxable income (losses) for the investment partnerships represent   
losses from Operating Partnerships which in turn consist substantially of       
depreciation and mortgage interest.                                             

Note 5: Federal credits include low-income housing tax credits and historic tax 
credits.                                                                        

Note 6: Cash generated from operations is the net income (loss), net of non-cash
expenses, adjusted for changes in accounts receivable and payable and           
distributions received from the operating partnerships.                         

Note 7: Federal low-income housing tax credits and historic tax credits and     
taxable income (loss), per $1,000 invested represents the limited partners'     
allocable share of such items divided by the capital contributed by the limited 
partners divided by $1,000. This information is presented on a Tax basis and not
a GAAP basis.                                                                   

Note 8: The information provided in the tables labeled "Tax & Distribution Data 
per $1,000 invested on a Tax Basis" is through the period December 31, 2004.    

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TABLE III-A 

Table III-A summarizes the Actual Tax Credit results during the period          
January 1, 1988 through December 31, 2004, of the five public partnerships and  
49 private partnerships sponsored by our affiliates. The Actual Tax Credits     
represent annual tax credits as a percentage of capital invested by an investor.
The percentage is calculated by dividing the amount of tax credits received for 
the period by the amount of capital invested. For example, for each dollar      
invested in BCTC 1, the investor received approximately $0.1096 of tax credits  
in 1989. Likewise, the headings "Cumulative" and "Overall Tax Credit Objective" 
represent cumulative tax credits as a percentage of capital invested by an      
investor.                                                                       

Public Partnerships                                                             

                                                        [Enlarge/Download Table]


                                      Final                                                                                       
                         Equity      Closing                                                                                      
       Program           Raised        Date        1988       1989     1990(1)      1991       1992       1993       1994         
---------------------  ----------   ----------   --------   --------   --------   --------   --------   --------   --------       
                                                                                                                                  
BCTC 1...............  12,999,000    Dec. 1988     1.00      10.96      21.81      14.02      14.01      14.05      14.01         
BCTC 2 (CA)(2).......   8,303,000    Apr. 1989                4.15      24.78      29.17      26.75      16.91      10.96         
BCTC 3...............  28,822,000     May 1989               11.99      18.46      12.72      12.66      12.80      12.80         
BCTC 4...............  29,788,160    Jun. 1989                7.74      17.16      13.58      12.32      12.57      12.24         
BCTC 5 (CA)(2).......   4,899,000    Jul. 1989                7.03      24.18      24.93      21.29      15.02      11.01         
BCTC 6...............  12,935,780   Sept. 1989                2.91      15.21      14.56      13.15      12.99      12.91         
BCTC II 7............  10,361,000    Dec. 1989                6.16      11.70      16.93      11.78      11.96      12.04         
BCTC II 9............  41,574,018     May 1990                           9.30      11.34      11.68      12.39      13.30         
BCTC II 10...........  24,288,998    Aug. 1990                           3.10      10.24      11.85      13.97      14.47         
BCTC II 11...........  24,735,003    Dec. 1990                           4.50       7.78      12.13      12.67      13.16         
BCTC II 12...........  29,710,003     May 1991                                      4.70      10.91      11.98      14.12         
BCTC II 14...........  55,728,996    Dec. 1991                                      3.80       8.79      12.32      13.83         
BCTC III 15..........  38,705,000    Jun. 1992                                                 3.10       9.07      13.22         
BCTC III 16..........  54,293,000    Dec. 1992                                                 1.40       4.36       8.56         
BCTC III 17..........  50,000,000     May 1993                                                            3.14       8.21         
BCTC III 18..........  36,162,000    Oct. 1993                                                            0.07       7.18         
BCTC III 19..........  40,800,000    Dec. 1993                                                            0.00       1.82         
BCTC IV 20...........  38,667,000    Jun. 1994                                                                       2.10         
BCTC IV 21...........  18,927,000   Sept. 1994                                                                       0.00         
BCTC IV 22...........  25,644,000    Dec. 1994                                                                       0.00         
BCTC IV 23...........  33,366,000    Jun. 1995                                                                                    
BCTC IV 24...........  21,697,000   Sept. 1995                                                                                    
BCTC IV 25...........  30,248,000    Dec. 1995                                                                                    
BCTC IV 26...........  39,959,000    Jun. 1996                                                                                    
BCTC IV 27...........  24,607,000   Sept. 1996                                                                                    
BCTC IV 28...........  39,999,000    Jan. 1997                                                                                    



       Program           1995       1996       1997       1998       1999       2000       2001       2002       2003       2004  
---------------------  --------   --------   --------   --------   --------   --------   --------   --------   --------   --------
                                                                                                                                  
BCTC 1...............   14.01      14.01      14.02      11.94       1.10      (1.45)      0.00       0.00       0.00       0.00  
BCTC 2 (CA)(2).......   10.43      10.12      10.12      10.12       9.58       3.56       0.92       0.56       0.56       0.51  
BCTC 3...............   12.73      12.73      12.72      12.37       5.97       0.52       0.44       0.44       0.44       0.37  
BCTC 4...............   12.24      12.25      12.26      12.26       9.50       0.44       0.00       0.00       0.00       0.00  
BCTC 5 (CA)(2).......   10.59      10.30      10.30       9.98       9.53       1.85       .083       0.06       0.48       0.48  
BCTC 6...............   12.90      13.47      12.71      12.72      11.33       2.84       0.25       0.16       0.15       0.15  
BCTC II 7............   12.04      12.04      12.04      12.04       7.08       5.07       2.97       0.42       0.18       0.17  
BCTC II 9............   13.56      13.67      13.67      13.56      12.63       8.06       2.69       2.26       1.54       0.45  
BCTC II 10...........   14.62      14.60      14.60      14.43      13.06      11.39       3.96       2.05       0.39       0.22  
BCTC II 11...........   13.20      13.20      13.20      13.15      13.11      12.39       6.33       1.01       0.58       0.16  
BCTC II 12...........   14.61      14.58      14.62      14.59      14.56      14.52       9.57       3.56       2.80       0.55  
BCTC II 14...........   14.23      14.33      14.35      14.18      14.14      13.94      12.55       4.83       1.71       0.46  
BCTC III 15..........   14.29      14.65      14.69      14.66      14.56      14.54      14.54      11.43       5.52       1.42  
BCTC III 16..........   13.75      14.05      14.00      14.00      14.00      14.00      13.99      13.97      11.38       5.56  
BCTC III 17..........   13.42      13.97      13.97      13.97      13.97      13.61      13.49      13.46      12.72       5.39  
BCTC III 18..........   12.67      13.31      13.34      13.34      13.32      13.34      13.34      13.35      13.26      10.58  
BCTC III 19..........   10.10      12.45      13.28      13.33      13.33      13.33      13.33      13.33      13.33      12.77  
BCTC IV 20...........    8.29      13.24      13.30      13.32      13.32      13.32      13.32      13.32      12.15      10.88  
BCTC IV 21...........    3.43       9.07      11.34      11.90      12.03      12.09      12.06      12.05      12.06      12.07  
BCTC IV 22...........    4.59      10.28      11.95      12.54      12.65      12.63      12.63      12.48      12.59      12.59  
BCTC IV 23...........    2.50       8.97      12.88      13.10      13.10      13.10      13.10      13.10      13.10      13.07  
BCTC IV 24...........    1.36       5.03      11.21      12.75      12.76      12.72      12.75      12.76      11.81      11.51  
BCTC IV 25...........    0.00       1.34      10.77      12.52      12.28      12.52      12.37      12.37      12.37      12.40  
BCTC IV 26...........               2.10       5.90      10.04      11.34      11.83      11.82      11.82      11.80      11.80  
BCTC IV 27...........               0.74       2.01       6.85       9.82      11.29      11.40      11.40      11.40      11.40  
BCTC IV 28...........               0.00       0.66       4.90       8.80      10.44      10.47      10.53      10.50      10.51  


                                    Cumulative       Overall                                                                      
                        Cumu-          time        Tax Credit                                                                     
                        lative       invested       Objective                                                                     
       Program           (%)        thru 2004          (%)                                                                        
---------------------  --------   --------------   -----------                                                                    
                                                                                                                                  
BCTC 1...............   143.49       16 yrs.        130-150                                                                       
BCTC 2 (CA)(2).......   169.20    15 yrs. 8 mos.      170                                                                         
BCTC 3...............   140.16    15 yrs. 7 mos.    130-150                                                                       
BCTC 4...............   134.56    15 yrs. 6 mos.    130-150                                                                       
BCTC 5 (CA)(2).......   157.86    15 yrs. 5 mos.    150-170                                                                       
BCTC 6...............   138.41    15 yrs. 3 mos.    130-150                                                                       
BCTC II 7............   134.62       15 yrs.        130-140                                                                       
BCTC II 9............   140.10    14 yrs. 7 mos.    130-150                                                                       
BCTC II 10...........   142.95    14 yrs. 4 mos.    130-150                                                                       
BCTC II 11...........   136.57       14 yrs.        130-150                                                                       
BCTC II 12...........   145.67    13 yrs. 7 mos.    140-160                                                                       
BCTC II 14...........   143.46       13 yrs.        140-160                                                                       
BCTC III 15..........   145.69    12 yrs. 6 mos.    140-160                                                                       
BCTC III 16..........   143.02       12 yrs.        140-160                                                                       
BCTC III 17..........   139.32    11 yrs. 7 mos.    140-160                                                                       
BCTC III 18..........   137.10    11 yrs. 2 mos.    140-160                                                                       
BCTC III 19..........   130.40       11 yrs.        140-160                                                                       
BCTC IV 20...........   126.56    10 yrs. 6 mos.    130-150                                                                       
BCTC IV 21...........   108.10    10 yrs. 3 mos.    130-150                                                                       
BCTC IV 22...........   114.93       10 yrs.        130-150                                                                       
BCTC IV 23...........   116.02    9 yrs. 6 mos.     130-150                                                                       
BCTC IV 24...........   104.66    9 yrs. 3 mos.     130-150                                                                       
BCTC IV 25...........    98.94        9 yrs.        130-150                                                                       
BCTC IV 26...........    88.45    8 yrs. 6 mos.     120-140                                                                       
BCTC IV 27...........    76.31    8 yrs. 3 mos.     120-140                                                                       
BCTC IV 28...........    66.81    7 yrs. 11 mos.    120-140                                                                       

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                                                        [Enlarge/Download Table]


                                          Final                                                                                   
                           Equity        Closing                                                                                  
       Program             Raised          Date        1988       1989     1990(1)      1991       1992       1993       1994     
---------------------  --------------   ----------   --------   --------   --------   --------   --------   --------   --------   
                                                                                                                                  
BCTC IV 29...........      39,918,000    Jun. 1997                                                                                
BCTC IV 30...........      26,490,750   Sept. 1997                                                                                
BCTC IV 31...........      44,057,750    Jan. 1998                                                                                
BCTC IV 32...........      47,431,000    Jun. 1998                                                                                
BCTC IV 33...........      26,362,000   Sept. 1998                                                                                
BCTC IV 34...........      35,273,000    Feb. 1999                                                                                
BCTC IV 35...........      33,004,625    Jun. 1999                                                                                
BCTC IV 36...........      21,068,375   Sept. 1999                                                                                
BCTC IV 37...........      25,125,000    Jan. 2000                                                                                
BCTC IV 38...........      25,431,000    Jul. 2000                                                                                
BCTC IV 39...........      22,921,000    Jan. 2001                                                                                
BCTC IV 40...........      26,269,250    Jul. 2001                                                                                
BCTC IV 41...........      28,916,260    Jan. 2002                                                                                
BCTC IV 42...........      27,442,620    Jul. 2002                                                                                
BCTC IV 43...........      36,379,870    Dec. 2002                                                                                
BCTC IV 44...........      27,019,730    Apr. 2003                                                                                
BCTC IV 45...........      40,143,670    Sep. 2003                                                                                
BCTC IV 46...........      29,809,980    Dec. 2003                                                                                
BCTC V 47(5).........      34,783,340    Apr. 2004                                                                                
BCTC V 48(5).........      22,993,720    Jul. 2004                                                                                
                       --------------                                                                                             
Total................  $1,398,059,898                                                                                             



       Program           1995       1996       1997       1998       1999       2000       2001       2002       2003       2004  
---------------------  --------   --------   --------   --------   --------   --------   --------   --------   --------   --------
                                                                                                                                  
BCTC IV 29...........                          1.98       4.92       8.39      10.76      10.79      10.79      10.79      10.78  
BCTC IV 30...........                          0.13       1.93       7.49      10.25      10.61      10.57      10.59      10.64  
BCTC IV 31...........                          0.06       2.83       8.05      10.29      10.34      10.32      10.34      10.34  
BCTC IV 32...........                                     2.08       4.11       8.87      10.24      10.35      10.10       9.83  
BCTC IV 33...........                                     1.95       3.66       9.40      10.32      10.50      10.16       9.62  
BCTC IV 34...........                                     0.00       1.60       7.89       9.79       9.79       9.79       9.79  
BCTC IV 35...........                                                0.39       3.95       8.79       9.54       9.67       9.67  
BCTC IV 36...........                                                0.15       6.39       9.87       9.80       9.78       9.78  
BCTC IV 37...........                                                0.00       1.37       7.13       9.10       9.67       9.66  
BCTC IV 38...........                                                           1.08       4.49       9.18       9.57       9.55  
BCTC IV 39...........                                                                      2.20       8.36       9.30       9.28  
BCTC IV 40...........                                                                      1.45       8.00       9.49       9.43  
BCTC IV 41...........                                                                      0.03       4.47      10.37      10.96  
BCTC IV 42...........                                                                                 1.63       8.10       9.47  
BCTC IV 43...........                                                                                 0.42       4.54       8.63  
BCTC IV 44...........                                                                                            2.44       6.69  
BCTC IV 45...........                                                                                            0.90       5.54  
BCTC IV 46...........                                                                                                       2.38  
BCTC V 47(5).........                                                                                                       0.90  
BCTC V 48(5).........                                                                                                       0.00  
Total................                                                                                                             


                                    Cumulative       Overall                                                                      
                        Cumu-          time        Tax Credit                                                                     
                        lative       invested       Objective                                                                     
       Program           (%)        thru 2004          (%)                                                                        
---------------------  --------   --------------   -----------                                                                    
                                                                                                                                  
BCTC IV 29...........   69.20     7 yrs. 6 mos.     110-130                                                                       
BCTC IV 30...........   62.21     7 yrs. 3 mos.     110-130                                                                       
BCTC IV 31...........   62.57     6 yrs. 11 mos.    110-130                                                                       
BCTC IV 32...........   55.58     6 yrs. 6 mos.     100-120                                                                       
BCTC IV 33...........   55.61     6 yrs. 3 mos.     100-120                                                                       
BCTC IV 34...........   48.65     5 yrs. 10 mos.    100-120                                                                       
BCTC IV 35...........   42.01     5 yrs. 6 mos.     100-110                                                                       
BCTC IV 36...........   45.77     5 yrs. 3 mos.     100-110                                                                       
BCTC IV 37...........   36.93     4 yrs. 11 mos.    100-110                                                                       
BCTC IV 38...........   33.87     4 yrs. 5 mos.      95-100                                                                       
BCTC IV 39...........   29.14     3 yr. 11 mos.      95-100                                                                       
BCTC IV 40...........   28.37      3 yr. 5 mos.      95-100                                                                       
BCTC IV 41...........   25.83     2 yr. 11 mos.      95-100                                                                       
BCTC IV 42...........   19.20      2 yr. 5 mos.    97.5-102.5                                                                     
BCTC IV 43...........   13.59         2 yr.        97.5-102.5                                                                     
BCTC IV 44...........    9.13      1 yr. 8 mos.    97.5-102.5                                                                     
BCTC IV 45...........    6.44      1 yr. 3 mos.      95-102                                                                       
BCTC IV 46...........    2.38         1 yr.        97.5-102.5                                                                     
BCTC V 47(5).........    0.90         8 mos.       97.5-102.5                                                                     
BCTC V 48(5).........    0.00         5 mos.       97.5-102.5                                                                     
Total................                                                                                                             

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Private Partnerships                                                            

                                                        [Enlarge/Download Table]


                                       Final          Annual Tax Credits (as% of Capital Invested)Annual Tax Cre         
                          Equity      Closing    ---------------------------------------------------------------         
       Program          Raised(6)       Date       1993       1994       1995       1996       1997       1998           
---------------------  ------------   --------   --------   --------   --------   --------   --------   --------         
                                                                                                                         
BCCTC................  $100,000,000   Feb 93       6.22      12.40      15.25      16.12      16.46      16.40           
BCCTC II.............  $ 36,500,000   Nov 93       0.01       6.35      12.68      15.57      16.02      16.03           
BCCTC III............  $ 96,500,000   Dec 94                  0.01       5.34      12.60      14.57      14.60           
BCCTC IV.............  $ 67,183,310   Sept 95                            0.43       6.55      13.08      15.11           
BCCTC V..............  $ 56,640,355   June 96                                       3.44       5.25      12.01           
BCCTC VI.............  $ 42,563,100   Nov 96                                           0       3.68      11.14           
BCCTC VII............  $ 52,100,000   Apr 97                                           0       1.99       9.25           
BCCTC VIII...........  $ 69,964,760   June 97                                                  0.27       7.26           
BCCTC IX.............  $ 70,500,000   Oct 97                                                   0.07      10.06           
CA 1997..............  $ 26,130,000   Feb 98                                                   0.00       3.77           
BCCTC X..............  $ 45,286,500   Apr 98                                                              7.26           
BCCTC XI.............  $ 64,111,121   Jan 99                                                               .09           
CA II................  $ 38,793,558   Feb 99                                                               .38           
BCDP 1998............  $  8,632,205   Nov 98                                                              0.00           
BCCTC XII............  $ 66,036,000   Mar 99                                                                             
BCCTC XIV............  $ 70,693,086   Dec 99                                                                             
CA III...............  $ 55,714,846   Sep 99                                                                             
BCCTC XV.............  $ 69,174,992   Feb 01                                                                             
CA IV................  $ 26,787,354   Mar 00                                                                             
TX...................  $ 29,590,109   Dec 00                                                                             
BCDP 2000............  $142,126,374   N/A                                                                                
BCCTC XVI............  $ 64,368,800   Aug 01                                                                             
CA V.................  $ 18,041,943   Jul 01                                                                             
CA VI................  $  9,524,981   Oct 01                                                                             
GA I.................  $ 34,733,437   Jan 01                                                                             
BCDP 2001............  $ 22,741,449   N/A                                                                                
BCCTC XVII...........  $ 51,787,864   Apr 02                                                                             
BC Mid-Atlantic......  $ 12,439,025   Jun 01                                                                             
GA II................  $ 27,071,907   Dec 02                                                                             
BCCTC XVIII..........  $125,000,000   Apr 02                                                                             
BCDP 2002............  $131,273,604   N/A                                                                                
BCCTC XIX............  $ 93,844,179   Nov 03                                                                             
BCDP 2003............  $ 70,292,557   N/A                                                                                



                                         Annual Tax Credits (as% of Capital Invested)(4)(5)(7)                           
                                         ------------------------------------                                            
       Program                           7       1998       1999       2000       2001       2002       2003       2004  
---------------------                    ---   --------   --------   --------   --------   --------   --------   --------
                                                                                                                         
BCCTC................                                      16.40      16.35      16.21      15.60      11.93       4.53  
BCCTC II.............                                      16.04      15.98      16.02      16.02      16.01      10.83  
BCCTC III............                                      14.64      14.44      14.21      14.39      14.05      14.19  
BCCTC IV.............                                      15.40      15.42      15.42      15.40      15.23      15.20  
BCCTC V..............                                      12.75      13.15      13.15      13.06      13.12      13.12  
BCCTC VI.............                                      13.20      13.41      13.41      13.31      13.38      13.54  
BCCTC VII............                                      13.00      13.36      13.35      13.41      13.33      12.77  
BCCTC VIII...........                                      11.57      12.18      12.35      12.41      12.23      12.44  
BCCTC IX.............                                      10.93      10.68      11.54      11.76      11.53      11.49  
CA 1997..............                                      13.40      14.30      14.10      10.75       9.89       9.89  
BCCTC X..............                                       8.02      10.68      10.76      10.59      10.60      10.59  
BCCTC XI.............                                       4.69      10.57      11.64      11.75      11.69      11.75  
CA II................                                       6.14      14.88      15.03      11.26       9.68       9.68  
BCDP 1998............                                       1.65      14.17      11.66      14.17      14.17      14.31  
BCCTC XII............                                       1.38       8.49      11.93      11.10      11.07      11.14  
BCCTC XIV............                                        .17       4.84      10.70      10.95      10.98      11.07  
CA III...............                                        .76       7.53      13.95      13.69      11.04       9.73  
BCCTC XV.............                                                  2.91       8.50      10.75      10.76      10.63  
CA IV................                                                   .17       7.29      10.36      10.28      10.26  
TX...................                                                   .02       6.96      10.21      10.47      10.48  
BCDP 2000............                                                   .46       2.55       8.13      10.51      11.14  
BCCTC XVI............                                                             1.23       5.74      10.12      11.08  
CA V.................                                                            11.75      17.85      17.31       8.77  
CA VI................                                                             4.32      10.49      10.25      10.25  
GA I.................                                                             1.41      14.09      17.50      17.59  
BCDP 2001............                                                             3.79       5.18       6.74      10.18  
BCCTC XVII...........                                                                        1.64       8.48      10.94  
BC Mid-Atlantic......                                                                        6.10      10.95      10.95  
GA II................                                                                        2.50      12.72      17.90  
BCCTC XVIII..........                                                                         .09       4.06       8.95  
BCDP 2002............                                                                        1.17       4.75       8.14  
BCCTC XIX............                                                                                    .17       2.42  
BCDP 2003............                                                                                    .42      10.44  


                                    Cumulative       Overall                                                             
                        Cumu-          time         Tax Credit                                                           
                        lative       invested       Objective                                                            
       Program            %          thru 2004          %                                                                
---------------------  --------   ---------------   ----------                                                           
                                                                                                                         
BCCTC................   163.87    10 yrs. 10 mos.    169                                                                 
BCCTC II.............   157.56     10 yrs. 1 mo.     157                                                                 
BCCTC III............   133.04        9 yrs.         152                                                                 
BCCTC IV.............   127.24     8 yrs. 3 mos.     151                                                                 
BCCTC V..............    99.05     7 yrs. 6 mos.     141                                                                 
BCCTC VI.............    95.07     7 yrs. 1 mo.      135                                                                 
BCCTC VII............    90.46     6 yrs. 8 mos.     130                                                                 
BCCTC VIII...........    80.71     6 yrs. 6 mos.     129                                                                 
BCCTC IX.............    78.06     6 yrs. 2 mos.     121                                                                 
CA 1997..............    76.10    5 yrs. 10 mos.     117                                                                 
BCCTC X..............    68.50     5 yrs. 8 mos.     115                                                                 
BCCTC XI.............    62.18    4 yrs. 11 mos.     115                                                                 
CA II................    67.05    4 yrs. 10 mos.     113                                                                 
BCDP 1998............    70.13     5 yrs. 1 mo.      116                                                                 
BCCTC XII............    55.11     4 yrs. 9 mos.     112                                                                 
BCCTC XIV............    48.71        4 yrs.         110                                                                 
CA III...............    56.70     4 yrs. 3 mos.     110                                                                 
BCCTC XV.............    43.55    2 yrs. 10 mos.     105                                                                 
CA IV................    38.36     3 yrs. 9 mos.     105                                                                 
TX...................    38.14        3 yrs.         106                                                                 
BCDP 2000............    32.79          N/A          109                                                                 
BCCTC XVI............    28.17     2 yrs. 4 mos.     109                                                                 
CA V.................    55.68     2 yrs. 5 mos.     110                                                                 
CA VI................    35.31     2 yrs. 2 mos.     103                                                                 
GA I.................    50.59    2 yrs. 11 mos.     178                                                                 
BCDP 2001............    25.89          N/A          110                                                                 
BCCTC XVII...........    21.06     1 yr. 8 mos.      110                                                                 
BC Mid-Atlantic......    28.00     2 yrs. 6 mos.     110                                                                 
GA II................    33.12         1 yr.         173                                                                 
BCCTC XVIII..........    13.10        8 mos.         110                                                                 
BCDP 2002............    14.06          N/A          110                                                                 
BCCTC XIX............     2.59         1 mo.         106                                                                 
BCDP 2003............    10.86          N/A          127                                                                 

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                                        Final          Annual Tax Credits (as% of Capital Invested)Annual Tax Cre        
                           Equity      Closing    ---------------------------------------------------------------        
       Program           Raised(6)       Date       1993       1994       1995       1996       1997       1998          
---------------------   ------------   --------   --------   --------   --------   --------   --------   --------        
                                                                                                                         
BCCTC XX.............   $ 36,898,485   Mar 04                                                                            
BCCTC XX-A...........   $ 64,808,430   Mar 04                                                                            
BCCTC XXI............   $173,897,938   Sep 04                                                                            
BCCTC XXII...........   $117,256,965   Dec 04                                                                            
BCDP 2004............   $  9,379,712   N/A                                                                               



                                         Annual Tax Credits (as% of Capital Invested)(4)(5)(7)                           
                                         ------------------------------------                                            
       Program                           7       1998       1999       2000       2001       2002       2003       2004  
---------------------                    ---   --------   --------   --------   --------   --------   --------   --------
                                                                                                                         
BCCTC XX.............                                                                                              2.19  
BCCTC XX-A...........                                                                                              0.77  
BCCTC XXI............                                                                                              0.62  
BCCTC XXII...........                                                                                              0.03  
BCDP 2004............                                                                                              1.04  


                                  Cumulative     Overall                                                                 
                        Cumu-        time       Tax Credit                                                               
                        lative     invested     Objective                                                                
       Program            %        thru 2004        %                                                                    
---------------------  --------   -----------   ----------                                                               
                                                                                                                         
BCCTC XX.............    2.19      9 mos.        105                                                                     
BCCTC XX-A...........    0.77      9 mos.        105                                                                     
BCCTC XXI............    0.62      3 mos.        105                                                                     
BCCTC XXII...........    0.03      1 mo.         105                                                                     
BCDP 2004............    1.04       N/A          127                                                                     

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NOTES TO TABLE III-A

(1) The 1990 results reflect, where applicable, the election available to       
  partnerships owning interests in properties qualifying for federal housing
tax credits pursuant to the 1990 Omnibus Budget Reconciliation Act which
enables individual investors who held an interest in those partnerships 
   prior to October 31, 1990, to utilize only in 1990 up to 150% of the annual
federal housing tax credit, otherwise allowable for 1990. Where this    
    election was made, the annual federal housing tax credit has been reduced by
the 50% bonus ratably and will continue to be reduced over the remaining
years of the credit period.                                             

(2) These programs offered both California and federal housing tax credits.     

(3) Each investor's first year yield may vary slightly based upon actual date of
investor admission.                                                     

(4) The only material benefit from these programs may be tax credits which may  
 mean that a material portion of each tax credit may represent a return of
   the money originally invested if there is not enough money from the sale or
   refinancing of the respective apartment complexes to return each investor's
capital contribution.                                                   

(5) As with all programs less than one year old, these returns are for a partial
year.                                                                   

(6) Based upon a hypothetical $1,000,000 investment unit. The actual amount     
raised was smaller due to discounts applicable to certain investors and 
alternative payment methods. See Table I.                               

(7) Based upon the price per Unit paid by an Investor electing to pay its entire
    capital contribution upon admission, which are as follows: $770,000 per Unit
   for BCCTC, $740,000 per Unit for BCCTC II, $767,500 per Unit for BCCTC III,
   $749,500 per Unit for BCCTC IV, $788,000 per Unit for BCCTC V, $801,843 per
  Unit for BCCTC VI and $820,000 per Unit for each of BCCTC VII, BCCTC VIII,
  BCCTC IX, CA 1997, BCCTC X, BCCTC XI, CA II, BCCTC XII, BCCTC XIV, CA III,
BCCTC XV, CA IV, TX, BCDP 2000, BCCTC XVI, CA V, CA VI, GA I, BCDP 2001,
   BCCTC XVII, BC Mid-Atlantic, GA II, BCCTC XVIII, BCDP 2002, BCCTC XIX, BCDP
2003, BCCT XX, BCCTC XX-A, BCCTC XXI, BCCTC XXII and BCDP 2004.         

BCTC is Boston Capital Tax Credit Fund.                                         

BCTC II is Boston Capital Tax Credit Fund II.                                   

BCTC III is Boston Capital Tax Credit Fund III.                                 

BCTC IV is Boston Capital Tax Credit Fund IV.                                   

BCCTC is Boston Capital Corporate Tax Credit Fund, A Limited Partnership.       

BCCTC II is Boston Capital Corporate Tax Credit Fund II, A Limited Partnership. 

BCCTC III is Boston Capital Corporate Tax Credit Fund III, A Limited            
Partnership.                                                                    

BCCTC IV is Boston Capital Corporate Tax Credit Fund IV, A Limited Partnership. 

BCCTC V is Boston Capital Corporate Tax Credit Fund V, A Limited Partnership.   

BCCTC VI is Boston Capital Corporate Tax Credit Fund VI, A Limited Partnership. 

BCCTC VII is Boston Capital Corporate Tax Credit Fund VII, A Limited            
Partnership.                                                                    

BCCTC VIII is Boston Capital Corporate Tax Credit Fund VIII, A Limited          
Partnership.                                                                    

BCCTC IX is Boston Capital Corporate Tax Credit Fund IX, A Limited Partnership. 
CA 1997 is The California Corporate Tax Credit Fund--1997, A Limited            
Partnership.                                                                    

BCCTC X is Boston Capital Corporate Tax Credit Fund X, A Limited Partnership.   

BCCTC XI is Boston Capital Corporate Tax Credit Fund XI, A Limited Partnership. 
CA II is The California Corporate Tax Credit Fund II, A Limited Partnership     

BCDP 1998 is Boston Capital direct placement funds closed during 1998 and       
includes one investment partnership.                                            

BCCTC XII is Boston Capital Corporate Tax Credit Fund XII, A Limited            
Partnership.                                                                    

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BCCTC XIV is Boston Capital Corporate Tax Credit Fund XIV, A Limited            
Partnership. CA III is The California Corporate Tax Credit Fund III, A Limited  
Partnership                                                                     

BCCTC XV is Boston Capital Corporate Tax Credit Fund XV, A Limited Partnership  
CA IV is The California Corporate Tax Credit Fund IV, A Limited Partnership TX  
is the Texas Corporate Tax Credit Fund, A Limited Partnership                   

BCDP 2000 is Boston Capital direct placement funds closed during 2000 and       
includes 3 investment partnerships.                                             

BCCTC XVI is Boston Capital Corporate Tax Credit Fund XVI, A Limited            
Partnership. CA V is The California Corporate Tax Credit Fund V, A Limited      
Partnership. CA VI is The California Corporate Tax Credit Fund VI, A Limited    
Partnership. GA I is The Georgia Corporate Tax Credit Fund I, A Limited         
Partnership.                                                                    

BCDP 2001 is Boston Capital direct placement funds closed during 2001 and       
includes 2 investment partnerships.                                             

BCCTC XVII is Boston Capital Corporate Tax Credit Fund XVII, A Limited          
Partnership. BC Mid-Atlantic is Boston Capital Mid-Atlantic Corporate Tax Credit
Fund, A Limited Partnership. GA II is The Georgia Corporate Tax Credit Fund II, 
A Limited Partnership.                                                          

BCCTC XVIII is Boston Capital Corporate Tax Credit Fund XVIII, A Limited        
Partnership.                                                                    

BCDP 2002 is Boston Capital direct placement funds closed during 2002 and       
includes 4 investment partnerships.                                             

BCCTC XIX is Boston Capital Corporate Tax Credit Fund XIX, A Limited Partnership

BCDP 2003 is Boston Capital direct placement funds closed during 2003 and       
includes 5 investment partnerships.                                             

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TABLE V 
SALES OR DISPOSALS OF PROPERTIES

Table V summarizes the sales of apartment complexes and operating partnership   
interests since January 1, 2002, of our public and private affiliates not having
similar investment objectives to the Company. The excess or deficiency          
represents the results of the capital transaction of buying and selling the     
apartment complex or operating partnership interest. There is not always a      
direct correlation between whether there is a stated excess or deficiency and   
whether investors receive any of their investment back from the sale of an      
interest. Even if there is a stated excess, expenses such as fund management    
fees and unpaid loans to our affiliates may be deducted before investors receive
any of their investment back. If there is a stated deficiency, there still may  
be proceeds distributable to investors, though investors would not receive all  
of their investment back because the apartment complex or operating partnership 
interest was sold for less than the amount investors had invested.              

The Table should be read in conjunction with the introduction and accompanying  
Notes.                                                                          

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TABLE V SALES OR DISPOSALS OF PROPERTIES
PUBLIC OFFERINGS

                                                        [Enlarge/Download Table]

                                                       Boston Capital                          American Affordable 
                                                         Tax Credit                               Housing Fund I   
                                                    Fund II-Series 9 & 14    Boston Capital     and Boston Capital 
Investment Partnership:                             ---------------------      Tax Credit           Tax Credit     
                                                                            Fund II-Series 10   Fund II-Series 14  
                                                         California         -----------------  --------------------
                                                         Investors V          South Farm LP       Zinsmaster LP    
                                                        (a), (b), (f)           (b), (e)             (b), (e)      
Property Name:                                      ---------------------   -----------------  --------------------
                                                                                                                   
Date property acquired:............................        03/01/90              04/01/93            12/01/89      
Date of Sale:......................................        11/30/02              07/01/02            01/01/03      
Selling price, net of closing costs and GAAP                                                                       
  adjustments:                                                                                                     
  Cash received (disbursed) net of closing costs...       4,174,640             1,000,000                  --      
  Mortgage Balance and accrued interest at time of                                                                 
    sale...........................................       5,182,860             1,398,939           2,302,133      
  Purchase Money Mortgage taken back by program....              --                    --                  --      
  Adjustments resulting from application of GAAP...              --                    --                  --      
                                                         ----------            ----------           ---------      
Total:.............................................       9,357,500             2,398,939           2,302,133      
                                                         ==========            ==========           =========      
Cost of properties including closing and soft                                                                      
  costs:                                                                                                           
  Original mortgage financing......................       5,510,000             4,196,783           1,226,216      
    Total acquisition cost, capital improvement,                                                                   
      closing and soft costs (e)...................       6,996,282               857,847           1,459,784      
                                                         ----------            ----------           ---------      
Total:.............................................      12,506,282             5,054,630           2,686,000      
                                                         ==========            ==========           =========      
Excess (Deficiency) of property operating cash                                                                     
  receipts over cash expenditures (f)..............      (3,148,782)           (2,655,691)           (383,867)     
                                                         ==========            ==========           =========      


                                                        American                                                   
                                                       Affordable                                                  
                                                    Housing Fund II          American                              
Investment Partnership:                             ----------------        Affordable                             
                                                                         Housing Fund II                           
                                                        Carthage       --------------------                        
                                                         Court         Liberty Center, Ltd.                        
                                                        (b), (e)             (b), (e)                              
Property Name:                                      ----------------   --------------------                        
                                                                                                                   
Date property acquired:............................     12/01/88              12/01/88                             
Date of Sale:......................................     09/08/03              02/07/03                             
Selling price, net of closing costs and GAAP                                                                       
  adjustments:                                                                                                     
  Cash received (disbursed) net of closing costs...       19,091               150,000                             
  Mortgage Balance and accrued interest at time of                                                                 
    sale...........................................    1,253,969             1,650,227                             
  Purchase Money Mortgage taken back by program....           --                    --                             
  Adjustments resulting from application of GAAP...           --                    --                             
                                                       ---------            ----------                             
Total:.............................................    1,273,060             1,800,227                             
                                                       =========            ==========                             
Cost of properties including closing and soft                                                                      
  costs:                                                                                                           
  Original mortgage financing......................    1,296,000             1,772,332                             
    Total acquisition cost, capital improvement,                                                                   
      closing and soft costs (e)...................      384,407             1,444,758                             
                                                       ---------            ----------                             
Total:.............................................    1,680,407             3,217,090                             
                                                       =========            ==========                             
Excess (Deficiency) of property operating cash                                                                     
  receipts over cash expenditures (f)..............     (407,347)           (1,416,863)                            
                                                       =========            ==========                             

(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               

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PUBLIC OFFERINGS

(i)  Mortgage balance and accrued interest are estimated.                       
(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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TABLE V SALES OR DISPOSALS OF PROPERTIES
PUBLIC OFFERINGS

                                                        [Enlarge/Download Table]


                                                                                  American              American    
                                                                                 Affordable            Affordable   
                                                             American          Housing Fund II      Housing Fund II 
Investment Partnership:                                     Affordable      ---------------------   ----------------
                                                         Housing Fund II                                            
                                                         ----------------       Rouse Stokes           Washington   
                                                          Malone Housing     Rowe Housing Assoc.          Mews      
                                                             (b), (e)             (b), (e)              (a), (b)    
Property Name:                                           ----------------   ---------------------   ----------------
                                                                                                                    
Date property acquired:................................      12/01/88              06/01/88             08/01/88    
Date of Sale:..........................................      09/08/03              12/31/03             01/01/03    
Selling price, net of closing costs and GAAP                                                                        
  adjustments:                                                                                                      
  Cash received (disbursed) net of closing costs.......        23,864                    --            1,357,573    
  Mortgage Balance and accrued interest at time of                                                                  
    sale...............................................     1,455,463             1,054,279              460,035    
  Purchase Money Mortgage taken back by program........            --                    --                   --    
  Adjustments resulting from application of GAAP.......            --                    --                   --    
                                                            ---------            ----------            ---------    
Total:.................................................     1,479,327             1,054,279            1,817,608    
                                                            =========            ==========            =========    
Cost of properties including closing and soft costs:                                                                
  Original mortgage financing..........................     1,499,990             1,540,000            1,200,000    
    Total acquisition cost, capital improvement,                                                                    
      closing and soft costs (e).......................       439,932               958,170              726,102    
                                                            ---------            ----------            ---------    
Total:.................................................     1,939,922             2,498,170            1,926,102    
                                                            =========            ==========            =========    
Excess (Deficiency) of property operating cash receipts                                                             
  over cash expenditures (f)...........................      (460,595)           (1,443,891)            (108,494)   
                                                            =========            ==========            =========    


                                                           Boston Capital        Boston Capital                     
                                                             Tax Credit            Tax Credit                       
                                                           Fund I-Series 3       Fund I-Series 3                    
                                                         and Boston Capital    and Boston Capital                   
                                                             Tax Credit            Tax Credit                       
                                                         Fund III-Series 17    Fund III-Series 15                   
Investment Partnership:                                  -------------------   -------------------                  

                                                             California              Hidden                         
                                                            Investors VI           Cove Apts.                       
                                                              (a), (b)              (a), (b)                        
Property Name:                                           -------------------   -------------------                  
                                                                                                                    
Date property acquired:................................        03/01/90              04/01/89                       
Date of Sale:..........................................        06/05/03              05/08/03                       
Selling price, net of closing costs and GAAP                                                                        
  adjustments:                                                                                                      
  Cash received (disbursed) net of closing costs.......       3,022,252             2,819,590                       
  Mortgage Balance and accrued interest at time of                                                                  
    sale...............................................       3,518,143             3,592,538                       
  Purchase Money Mortgage taken back by program........              --                    --                       
  Adjustments resulting from application of GAAP.......              --                    --                       
                                                             ----------             ---------                       
Total:.................................................       6,540,395             6,412,127                       
                                                             ==========             =========                       
Cost of properties including closing and soft costs:                                                                
  Original mortgage financing..........................       4,160,000             3,150,000                       
    Total acquisition cost, capital improvement,                                                                    
      closing and soft costs (e).......................       4,418,662             2,711,958                       
                                                             ----------             ---------                       
Total:.................................................       8,578,662             5,861,958                       
                                                             ==========             =========                       
Excess (Deficiency) of property operating cash receipts                                                             
  over cash expenditures (f)...........................      (2,038,267)              550,169                       
                                                             ==========             =========                       

(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 

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PUBLIC OFFERINGS

(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       
(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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PUBLIC OFFERINGS

                                                        [Enlarge/Download Table]

                                                          American           American          American          American    
                                                         Affordable         Affordable        Affordable        Affordable   
                                    Boston Capital     Housing Fund I    Housing Fund II   Housing Fund II   Housing Fund II 
Investment Partnership:               Tax Credit     ------------------  ----------------  ----------------  ----------------
                                    Fund I-Series 4                                                                          
                                    ---------------  Pixley Investment      East Ridge      Kingsley Park       Riverplace   
                                     Sunnyview II          Group            Associates        Associates        Apartments   
                                       (a), (b)           (b), (e)             (g)             (b), (e)          (b), (e)    
Property Name:                      ---------------  ------------------  ----------------  ----------------  ----------------
                                                                                                                             
Date property acquired:...........      09/01/89          03/01/88           08/01/88           03/01/88          09/01/88   
Date of Sale:.....................      06/05/03          11/17/04           03/01/04           06/22/04          08/31/04   
Selling price, net of closing                                                                                                
  costs and GAAP adjustments:                                                                                                
  Cash received (disbursed) net of                                                                                           
    closing costs.................     3,303,932            47,040                 --             25,000            25,000   
  Mortgage Balance and accrued                                                                                               
    interest at time of sale......     1,021,000         1,438,530          1,301,760         10,423,457         3,700,000   
  Purchase Money Mortgage taken                                                                                              
    back by program...............            --                --                 --                 --                --   
  Adjustments resulting from                                                                                                 
    application of GAAP...........            --                --                 --                 --                --   
                                       ---------         ---------          ---------         ----------        ----------   
Total:............................     4,324,932         1,485,570          1,301,760         10,448,457         3,725,000   
                                       =========         =========          =========         ==========        ==========   
Cost of properties including                                                                                                 
  closing and soft costs:                                                                                                    
  Original mortgage financing.....     2,300,000         1,500,000          1,237,500         10,396,900         4,500,000   
    Total acquisition cost,                                                                                                  
      capital improvement, closing                                                                                           
      and soft costs (e)..........     1,055,665           473,181            405,087          2,135,594         2,596,882   
                                       ---------         ---------          ---------         ----------        ----------   
Total:............................     3,355,665         1,973,181          1,642,587         12,505,494         7,096,882   
                                       =========         =========          =========         ==========        ==========   
Excess (Deficiency) of property                                                                                              
  operating cash receipts over                                                                                               
  cash expenditures (f)...........       969,267          (487,611)          (340,827)        (2,057,037)       (3,371,882)  
                                       =========         =========          =========         ==========        ==========   

(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               

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PUBLIC OFFERINGS

(i)  Mortgage balance and accrued interest are estimated.                       
(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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PUBLIC OFFERINGS

                                                        [Enlarge/Download Table]

                                         American          American          American          American          American    
                                        Affordable        Affordable        Affordable        Affordable        Affordable   
                                     Housing Fund II   Housing Fund II   Housing Fund II   Housing Fund II   Housing Fund II 
Investment Partnership:              ----------------  ----------------  ----------------  ----------------  ----------------
                                       300 Shawmut        Blairview         Bloomfield      Fredericktown      Garden City   
                                          Avenue          Associates        Associates        Associates      Family Housing 
                                         (b), (e)          (b), (e)          (b), (e)          (b), (e)          (b), (e)    
Property Name:                       ----------------  ----------------  ----------------  ----------------  ----------------
                                                                                                                             
Date property acquired:............      11/01/88          03/01/89          06/01/88          06/01/88          06/01/88    
Date of Sale:......................      11/01/04          12/01/04          12/28/04          12/28/04          12/28/04    
Selling price, net of closing costs                                                                                          
  and GAAP adjustments:                                                                                                      
  Cash received (disbursed) net of                                                                                           
    closing costs..................             1                 1            10,792            10,851            11,228    
  Mortgage Balance and accrued                                                                                               
    interest at time of sale.......       892,949         1,399,892           359,727           361,691           374,253    
  Purchase Money Mortgage taken                                                                                              
    back by program................            --                --                --                --                --    
  Adjustments resulting from                                                                                                 
    application of GAAP............            --                --                --                --                --    
                                         --------         ---------          --------          --------          --------    
Total:.............................       892,950         1,399,893           370,519           372,542           385,481    
                                         ========         =========          ========          ========          ========    
Cost of properties including                                                                                                 
  closing and soft costs:                                                                                                    
  Original mortgage financing......       270,000         1,444,475           366,390           377,214           383,800    
    Total acquisition cost, capital                                                                                          
      improvement, closing and soft                                                                                          
      costs (e)....................       723,254           439,061           117,996           113,429           123,558    
                                         ========         =========          ========          ========          ========    
Total:.............................       993,254         1,883,536           484,386           490,643           507,358    
                                         ========         =========          ========          ========          ========    
Excess (Deficiency) of property                                                                                              
  operating cash receipts over cash                                                                                          
  expenditures (f).................      (100,304)         (483,643)         (113,867)         (118,101)         (121,877)   
                                         ========         =========          ========          ========          ========    

(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       
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PUBLIC OFFERINGS

(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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PUBLIC OFFERINGS

                                                        [Enlarge/Download Table]

                                                                                            American           American     
                                     American          American          American          Affordable         Affordable    
                                    Affordable        Affordable        Affordable      Housing Fund III   Housing Fund III 
                                 Housing Fund II   Housing Fund II   Housing Fund III   -----------------  -----------------
Investment Partnership:          ----------------  ----------------  -----------------    Grass Valley        Weaverville   
                                 Marionville III       Nebraska          428 South         Investment         Investment    
                                  Family Housing     City Senior       Grandview, LP        Group II           Group II     
                                     (b), (e)          (b), (e)        (b), (e), (i)        (b), (e)           (b), (e)     
Property Name:                   ----------------  ----------------  -----------------  -----------------  -----------------
                                                                                                                            
Date property acquired:.........     06/01/88          06/01/88           12/01/88           12/01/88           12/01/88    
Date of Sale:...................     12/28/04          12/28/04           02/01/04           11/17/04           11/17/04    
Selling price, net of closing                                                                                               
  costs and GAAP adjustments:                                                                                               
  Cash received (disbursed) net                                                                                             
    of closing costs............        5,677            12,266                 --             40,800             43,776    
  Mortgage Balance and accrued                                                                                              
    interest at time of sale....      189,239           408,852          2,199,726          1,521,911          1,527,589    
  Purchase Money Mortgage taken                                                                                             
    back by program.............           --                --                 --                 --                 --    
  Adjustments resulting from                                                                                                
    application of GAAP.........           --                --                 --                 --                 --    
                                     --------          --------         ----------         ----------         ----------    
Total:..........................      194,916           421,118          2,199,726          1,562,711          1,571,365    
                                     ========          ========         ==========         ==========         ==========    
Cost of properties including                                                                                                
  closing and soft costs:                                                                                                   
  Original mortgage financing...      197,299           428,759          2,119,934          1,500,000          1,500,000    
    Total acquisition cost,                                                                                                 
      capital improvement,                                                                                                  
      closing and soft                                                                                                      
      costs (e).................       59,939           122,314          1,777,941            858,288            815,128    
                                     --------          --------         ----------         ----------         ----------    
Total:..........................      257,238           551,073          3,897,875          2,358,288          2,315,128    
                                     ========          ========         ==========         ==========         ==========    
Excess (Deficiency) of property                                                                                             
  operating cash receipts over                                                                                              
  cash expenditures (f).........      (62,322)         (129,955)        (1,698,149)          (795,577)          (743,763)   
                                     ========          ========         ==========         ==========         ==========    

------------                                                                    
(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 

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PUBLIC OFFERINGS

(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       
(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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PUBLIC OFFERINGS

                                                        [Enlarge/Download Table]

                                                         Boston Capital  Boston Capital                       Boston Capital 
                                         Boston Capital    Tax Credit      Tax Credit      Boston Capital       Tax Credit   
                                           Tax Credit    Fund-Series 1   Fund-Series 1       Tax Credit       Fund I-Series 3
                                         Fund-Series 1   --------------  --------------    Fund I-Series 3    ---------------
Investment Partnership:                  --------------     Conneaut         Geneva      -------------------  Taylor Terrace 
                                         Bolivar Manor      Limited         Limited         Lincoln Hotel         Housing    
                                            (b), (e)        (b), (e)        (b), (e)     Associates (a), (b)     (b), (e)    
Property Name:                           --------------  --------------  --------------  -------------------  ---------------
                                                                                                                             
Date property acquired:................     12/01/89        01/01/89        01/01/89           02/01/89           04/01/89   
Date of Sale:..........................     12/01/04        12/01/04        12/01/04           02/06/04           06/29/04   
Selling price, net of closing costs and                                                                                      
  GAAP adjustments:                                                                                                          
  Cash received (disbursed) net of                                                                                           
    closing costs......................            1           6,079           6,079                 --             75,672   
  Mortgage Balance and accrued interest                                                                                      
    at time of sale....................      863,581       1,147,562       1,163,436          3,282,476          1,030,000   
  Purchase Money Mortgage taken back by                                                                                      
    program............................           --              --              --                 --                 --   
  Adjustments resulting from                                                                                                 
    application of GAAP................           --              --              --                 --                 --   
                                           ---------       ---------       ---------          ---------          ---------   
Total:.................................      863,582       1,153,641       1,169,515          3,282,476          1,105,672   
                                           =========       =========       =========          =========          =========   
Cost of properties including closing                                                                                         
  and soft costs:                                                                                                            
  Original mortgage financing..........      889,200       1,187,000       1,198,800          2,900,000          1,066,000   
    Total acquisition cost, capital                                                                                          
      improvement, closing and soft                                                                                          
      costs (e)........................      258,705         359,326         365,411            718,516            313,802   
                                           ---------       ---------       ---------          ---------          ---------   
Total:.................................    1,147,905       1,546,326       1,564,211          3,618,516          1,379,802   
                                           =========       =========       =========          =========          =========   
Excess (Deficiency) of property                                                                                              
  operating cash receipts over cash                                                                                          
  expenditures (f).....................     (284,323)       (392,685)       (394,696)          (336,040)          (274,130)  
                                           =========       =========       =========          =========          =========   

------------                                                                    
(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       

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PUBLIC OFFERINGS

(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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PUBLIC OFFERINGS

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                                        Boston Capital                      Boston Capital   Boston Capital   Boston Capital 
                                          Tax Credit                          Tax Credit       Tax Credit       Tax Credit   
                                        Fund I-Series 3    Boston Capital   Fund I-Series 4  Fund I-Series 4  Fund I-Series 4
Investment Partnership                -------------------    Tax Credit     ---------------  ---------------  ---------------
                                                            Fund-Series 3                                                    
                                      Pedcor Investments   ---------------      Fuller        Montana Ave.       Van Dyck    
                                            1988-IV        128 Park Street     Homes LP         Townhomes       Estates XVI  
                                           (b), (e)           (b), (e)         (b), (e)         (b), (e)         (b), (e)    
Property Name:                        -------------------  ---------------  ---------------  ---------------  ---------------
                                                                                                                             
Date property acquired:.............        02/01/89          04/01/89         04/01/89          08/01/89         02/01/90   
Date of Sale:.......................        07/29/04          11/01/04         01/05/04          01/05/04         02/25/04   
Selling price, net of closing costs                                                                                          
  and GAAP adjustments:                                                                                                      
  Cash received (disbursed) net of                                                                                           
    closing costs...................         320,000                 1           40,909            59,091          515,000   
  Mortgage Balance and accrued                                                                                               
    interest at time of sale........       4,967,272           965,805          553,808           736,765          586,229   
  Purchase Money Mortgage taken back                                                                                         
    by program......................              --                --               --                --               --   
  Adjustments resulting from                                                                                                 
    application of GAAP.............              --                --               --                --               --   
                                          ----------          --------         --------         ---------        ---------   
Total:..............................       5,287,272           965,806          594,717           795,856        1,101,229   
                                          ==========          ========         ========         =========        =========   
Cost of properties including closing                                                                                         
  and soft costs:                                                                                                            
  Original mortgage financing.......       5,167,000           250,526          478,769           694,871          680,000   
    Total acquisition cost, capital                                                                                          
      improvement, closing and soft                                                                                          
      costs (e).....................       3,621,071           469,799          346,900           585,951          646,149   
                                          ----------          --------         --------         ---------        ---------   
Total:..............................       8,788,071           720,325          825,669         1,280,822        1,326,149   
                                          ==========          ========         ========         =========        =========   
Excess (Deficiency) of property                                                                                              
  operating cash receipts over cash                                                                                          
  expenditures (f)..................      (3,500,799)          245,481         (230,952)         (484,966)        (224,920)  
                                          ==========          ========         ========         =========        =========   

------------                                                                    
(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       

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PUBLIC OFFERINGS

(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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PUBLIC OFFERINGS

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                                 Boston Capital       Boston Capital       Boston Capital     Boston Capital   Boston Capital
                                   Tax Credit           Tax Credit           Tax Credit         Tax Credit       Tax Credit  
                                 Fund I-Series 4      Fund I-Series 4      Fund I-Series 5     Fund-Series 6   Fund-Series 6 
Property Name:                 -------------------  -------------------  -------------------  ---------------  --------------
                               Topeka Residential          Haven              Glenhaven          Columbia          Eldon     
                                   Fund Three        Park Partners II       Park Partners     Park Associates    Estates LP  
                                  (a), (b), (f)          (b), (e)             (b), (e)         (a), (b), (f)      (b), (e)   
Property Name:                 -------------------  -------------------  -------------------  ---------------  --------------
                                                                                                                             
Date property acquired:......        07/01/89             07/01/89             06/01/89           11/01/89         09/01/89  
Date of Sale:................        03/16/04             03/17/04             02/20/04           12/15/04         12/28/04  
Selling price, net of closing                                                                                                
  costs and GAAP adjustments:                                                                                                
  Cash received (disbursed)                                                                                                  
    net of closing costs.....          12,500              715,000               28,760          2,752,871           16,276  
  Mortgage Balance and                                                                                                       
    accrued interest at time                                                                                                 
    of sale..................         300,295              466,593               43,030          1,397,779          542,542  
  Purchase Money Mortgage                                                                                                    
    taken back by program....              --                   --                   --                 --               --  
  Adjustments resulting from                                                                                                 
    application of GAAP......              --                   --                   --                 --               --  
                                    ---------            ---------           ----------         ----------       ----------  
Total:.......................         312,795            1,181,593               71,790          4,150,650          558,818  
                                    =========            =========           ==========         ==========       ==========  
Cost of properties including                                                                                                 
  closing and soft costs:                                                                                                    
  Original mortgage                                                                                                          
    financing................         440,000              816,900              842,417          5,685,000          564,141  
    Total acquisition cost,                                                                                                  
      capital improvement,                                                                                                   
      closing and soft costs                                                                                                 
      (e)....................         415,728            1,066,558              917,760          1,954,986          163,935  
                                    ---------            ---------           ----------         ----------       ----------  
Total:.......................         855,728            1,883,458            1,760,177          7,639,986          728,076  
                                    =========            =========           ==========         ==========       ==========  
Excess (Deficiency) of                                                                                                       
  property operating cash                                                                                                    
  receipts over cash                                                                                                         
  expenditures (f)...........        (542,933)            (701,865)          (1,688,387)        (3,489,336)        (169,258) 
                                    =========            =========           ==========         ==========       ==========  

(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       

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(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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PUBLIC OFFERINGS

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                                                 Boston Capital   Boston Capital     Boston Capital        Boston Capital     
                                                   Tax Credit       Tax Credit         Tax Credit            Tax Credit       
                                                 Fund-Series 6   Fund II-Series 7   Fund II-Series 7      Fund II-Series 10   
Investment Partnership:                          --------------  -----------------  -----------------  -----------------------
                                                  Warrensburg         Buckner           Winfield         Pedcor Investments   
                                                   Properties       Properties         Properties              1989-X         
                                                    (b), (e)         (b), (e)           (b), (e)            (b), (e), (h)     
Property Name:                                   --------------  -----------------  -----------------  -----------------------
                                                                                                                              
Date property acquired:........................     09/01/89         12/01/89           12/01/89               07/01/90       
Date of Sale:..................................     12/28/04         12/28/04           12/28/04               12/01/04       
Selling price, net of closing costs and GAAP                                                                                  
  adjustments:                                                                                                                
  Cash received (disbursed) net of closing                                                                                    
    costs......................................       16,775           18,225             17,951                652,500       
  Mortgage Balance and accrued interest at time                                                                               
    of sale....................................      559,159          607,514            598,371              3,092,242       
  Purchase Money Mortgage taken back by                                                                                       
    program....................................           --               --                 --                     --       
  Adjustments resulting from application of                                                                                   
    GAAP.......................................           --               --                 --                     --       
                                                    --------         --------           --------             ----------       
Total:.........................................      575,934          625,739            616,322              3,744,742       
                                                    ========         ========           ========             ==========       
Cost of properties including closing and soft                                                                                 
  costs:                                                                                                                      
  Original mortgage financing..................      803,500          626,634            616,813              3,278,800       
    Total acquisition cost, capital                                                                                           
     improvement, closing and soft costs (e)...      160,146          191,893            186,983              2,712,700       
                                                    --------         --------           --------             ----------       
Total:.........................................      963,646          818,527            803,796              5,991,500       
                                                    ========         ========           ========             ==========       
Excess (Deficiency) of property operating cash                                                                                
  receipts over cash expenditures (f)..........     (387,712)        (192,788)          (187,474)            (2,246,758)      
                                                    ========         ========           ========             ==========       

(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       
(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
the problems at the property resulted in a                              

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 recapture of approximately 34.3% of the credits originally projected from
    the property and 2.9% of the total projected for the Investment Partnership,
it was determined that the best course of action was to preserve the    
Investment Partnership's reserves and allow the foreclosure to occur.   
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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TABLE V SALES OR DISPOSALS OF PROPERTIES
PRIVATE OFFERINGS 

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                                                              Boston Capital     Boston Capital   
                                                               Corporate Tax      Corporate Tax   
                                                               Credit Fund I      Credit Fund I   
Investment Partnership:                                       ---------------  -------------------
                                                              Kings Crossing     Partnership for  
                                                                  Limited      Affordable Housing 
                                                                Partnership        L.P. Gamma     
                                                               (g), (i), (j)      (g), (i), (k)   
Property Name:                                                ---------------  -------------------
                                                                                                  
Date property acquired:.....................................      02/01/93           05/01/93     
Date of Sale:...............................................      03/17/03           03/19/04     
Selling price, net of closing costs and GAAP adjustments:                                         
  Cash received (disbursed) net of closing costs............            --                 --     
  Mortgage Balance and accrued interest at time of sale.....     4,496,916          2,116,657     
  Purchase Money Mortgage taken back by program.............            --                 --     
  Adjustments resulting from application of GAAP............            --                 --     
                                                                ----------          ---------     
Total:......................................................     4,496,916          2,116,657     
                                                                ==========          =========     
Cost of properties including closing and soft costs:                                              
  Original mortgage financing...............................     4,396,700          2,067,569     
    Total acquisition cost, capital improvement, closing and                                      
     soft costs (e).........................................     8,206,440            692,622     
                                                                ----------          ---------     
Total:......................................................    12,603,140          2,760,191     
                                                                ==========          =========     
Excess (Deficiency) of property operating cash receipts over                                      
  cash expenditures (f).....................................    (8,106,224)          (643,534)    
                                                                ==========          =========     

(a) Sale was to a party unrelated to the operating general partner or Boston    
Associates.                                                             
(b) All taxable income was reported as Section 1231 income.                     
(c) Amounts shown include pro rata share of original offering costs.            
(d) The excess or deficiency represents results of the capital transaction of   
   buying and selling the apartment complex or operating partnership interest.
   A deficiency represents a situation in which the interest was sold for less
than the amount that the investors invested in the apartment complex, a 
    portion of this being the original load that affiliates of Boston Associates
    charged. An excess represents a situation in which the interest was sold for
more than the fully loaded cost of the apartment complex.               
(e) Sale of operating partnership interest.                                     
(f) Please note some closing costs were estimated.                              
(g) Foreclosure                                                                 
(h) Transferred 24.99% of the limited partner's interest in the operating       
 partnership for $163,059. 8.33% of the limited partner's interest will be
    transferred in 2005 for $54,353 and the remaining limited partner's interest
will be transferred in 2006 for $435,087.                               
(i)  Mortgage balance and accrued interest are estimated.                       

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(j)  The property could not sustain ongoing operations and the mortgage was in  
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 34.3%
   of the credits originally projected from the property and 2.9% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         
(k) The property could not sustain ongoing operations and the mortgage was in   
  default. The cost involved to bring the mortgage current and cover ongoing
 shortfalls through the end of the tax credit compliance period would have
   had a detrimental impact on the Investment Partnership's reserves. Although
   the problems at the property resulted in a recapture of approximately 33.3%
   of the credits originally projected from the property and .23% of the total
 projected for the Investment Partnership, it was determined that the best
  course of action was to preserve the Investment Partnership's reserves and
allow the foreclosure to occur.                                         

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                                                                       EXHIBIT A

REINVESTMENT PLAN 

BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC., a Maryland corporation (the  
"Company"), adopted a Reinvestment Plan (the "Reinvestment Plan") on the terms  
and conditions set forth below.                                                 

1.  Reinvestment of Distributions.  Boston Capital Securities, Inc., the agent  
(the "Reinvestment Agent") for participants (the "Participants") in the 
  Reinvestment Plan, will receive all cash distributions made by the Company
  with respect to shares of common stock of the Company (the "Shares") owned
 by each Participant (collectively, the "Distributions"). The Reinvestment
Agent will apply such Distributions as follows:                         

 (a) At any period during which the Company is making a public offering of
  Shares, the Reinvestment Agent will invest Distributions in Shares
 acquired from the dealer-manager or participating brokers for the
     offering at the public offering price per Share. Participants will be
charged dealer-manager fees on Shares acquired pursuant to the  
Reinvestment Plan.                                              

   (b) If no public offering of Shares is ongoing, the Reinvestment Agent will
      purchase Shares from any additional Shares which the Company elects to
        register with the Securities and Exchange Commission (the "SEC") for the
      Reinvestment Plan, at a per Share price equal to the fair market value
        of the Shares determined by quarterly appraisal updates performed by the
    Company based on a review of the existing appraisal of each property
     owned by the Company or in which the Company has an interest (each, a
"Property," and collectively, the "Properties"), focusing on a  
      re-examination of the capitalization rate applied to the rental stream
     to be derived from that Property. The capitalization rate used by the
     Company and, as a result, the price per Share paid by Participants in
      the Reinvestment Plan prior to the listing of the Shares on a national
        securities exchange or on the NASDAQ National Market ("Listing") will be
      determined by Boston Capital REIT Advisors, LLC (the "Advisor") in its
       sole discretion. The factors that the Advisor will use to determine the
      capitalization rate include (i) its experience in selecting, acquiring
      and overseeing the management of properties similar to the Properties;
(ii) an examination of the conditions in the market; and (iii)  
     capitalization rates in use by private appraisers, to the extent that
the Advisor deems such factors appropriate, as well             

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      as any other factors that the Advisor deems relevant or appropriate in
      making its determination. The Company's internal accountants will then
     convert the most recent quarterly balance sheet of the Company from a
     "GAAP" balance sheet to a "fair market value" balance sheet. Based on
    the "fair market value" balance sheet, the internal accountants will
     then assume a sale of the Company's assets and the liquidation of the
        Company in accordance with its constitutive documents and applicable law
     and compute the appropriate method of distributing the cash available
   after payment of reasonable liquidation expenses, including closing
    costs typically associated with the sale of assets and shared by the
        buyer and seller, and the creation of reasonable reserves to provide for
the payment of any contingent liabilities. Upon Listing, the    
    Reinvestment Agent may purchase Shares either through such market or
       directly from the Company pursuant to a registration statement relating
      to the Reinvestment Plan, in either case at a per Share price equal to
       the then-prevailing market price on the national securities exchange or
        on the NASDAQ National Market on which the Shares are listed at the date
       of purchase by the Reinvestment Agent. In the event that, after Listing
        occurs, the Reinvestment Agent purchases Shares on a national securities
exchange or on the NASDAQ National Market through a registered  
 broker-dealer, the amount to be reinvested will be reduced by any
brokerage commissions charged by such registered broker-dealer. 

(c) For each Participant, the Reinvestment Agent will maintain a record 
      which shall reflect for each fiscal quarter the Distributions received
by the Reinvestment Agent on behalf of such Participant. The    
        Reinvestment Agent will use the aggregate amount of distributions to all
Participants for each fiscal quarter to purchase Shares for the 
      Participants. If the aggregate amount of distributions to Participants
     exceeds the amount required to purchase all Shares then available for
       purchase, the Reinvestment Agent will purchase all available Shares and
     will return all remaining Distributions to the Participants within 30
     days after the date such Distributions are made. The purchased Shares
    will be allocated among the Participants based on the portion of the
       aggregate Distributions received by the Reinvestment Agent on behalf of
each Participant, as reflected in the records maintained by the 
     Reinvestment Agent. The ownership of the Shares purchased pursuant to
     the Reinvestment Plan shall be reflected on the books of the Company.

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(d) Distributions shall be invested by the Reinvestment Agent in Shares 
      promptly following the payment date with respect to such Distributions
to the extent Shares are available. If sufficient Shares are not
        available, Distributions shall be invested on behalf of the Participants
      in one or more interest-bearing accounts in a commercial bank approved
        by the Company which is located in the continental United States and has
assets of at least $100,000,000, until Shares are available for 
        purchase, provided that any Distributions that have not been invested in
      Shares within 30 days after such Distributions are made by the Company
shall be returned to Participants.                              

   (e) The allocation of Shares among Participants may result in the ownership
of fractional Shares, computed to four decimal places.          

(f) Distributions attributable to Shares purchased on behalf of the     
    Participants pursuant to the Reinvestment Plan will be reinvested in
additional Shares in accordance with the terms hereof.          

   (g) No certificates will be issued to a Participant for Shares purchased on
behalf of the Participant pursuant to the Reinvestment Plan.    
        Participants in the Reinvestment Plan will receive statements of account
in accordance with Section 6 below.                             

2.  Election to Participate.  Any stockholder who participates in a public      
offering of Shares and who has received a copy of the related final     
  prospectus included in the Company's registration statement filed with the
    SEC may elect to participate in and purchase Shares through the Reinvestment
Plan at any time by written notice to the Company and will not need to  
 receive a separate prospectus relating solely to the Reinvestment Plan. A
    person who becomes a stockholder otherwise than by participating in a public
 offering of Shares may purchase Shares through the Reinvestment Plan only
  after receipt of a separate prospectus relating solely to the Reinvestment
Plan. Participation in the Reinvestment Plan will commence with the next
   Distribution made after receipt of the Participant's notice, provided it is
received more than ten business days prior to the last day of the fiscal
quarter to which such Distribution relates. Subject to the preceding    
    sentence, regardless of the date of such election, a stockholder will become
a Participant in the Reinvestment Plan effective on the first day of the
  fiscal quarter following such election, and the election will apply to all
 Distributions attributable to the fiscal quarter in which the stockholder
  makes such written election to participate in the Reinvestment Plan and to
  all fiscal quarters or months thereafter. A Participant who has terminated
   his participation in the Reinvestment Plan pursuant to Paragraph 11 will be
allowed to participate in the Reinvestment Plan                         

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 again upon receipt of a current version of a final prospectus relating to
participation in the Reinvestment Plan which contains, at a minimum, the
following: (i) the minimum investment amount; (ii) the type or source of
proceeds which may be invested; and (iii) the tax consequences of the   
reinvestment to the Participant, by notifying the Reinvestment Agent and
completing any required forms. Stockholders who elect the monthly       
 distribution option, if available, are not eligible to participate in the
Reinvestment Plan. Boston Capital Holdings Limited Partnership and its  
affiliates are not eligible to participate in the Reinvestment Plan.    

3.  Distribution of Funds.  In making purchases for Participants' accounts, the 
   Reinvestment Agent may commingle Distributions attributable to Shares owned
by Participants in the Reinvestment Plan.                               

4.  Proxy Solicitation.  The Reinvestment Agent will distribute to Participants 
proxy solicitation material received by it from the Company which is    
    attributable to Shares held in the Reinvestment Plan. The Reinvestment Agent
will vote any Shares that it holds for the account of a Participant in  
 accordance with the Participant's written instructions. In the absence of
such written instructions, if a Participant gives a proxy to person(s)  
representing the Company covering Shares registered in the Participant's
name, such proxy will be deemed to be an instruction to the Reinvestment
  Agent to vote the full Shares in the Participant's account in like manner.
    If a Participant does not direct the Reinvestment Agent as to how the Shares
should be voted and does not give a proxy to person(s) representing the 
Company covering these Shares, the Reinvestment Agent will not vote the 
Shares.                                                                 

5.  Absence of Liability.  Neither the Company nor the Reinvestment Agent shall 
have any responsibility or liability as to the value of the Company's   
    Shares, any change in the value of the Shares acquired for the Participant's
account, or the rate of return earned on, or the value of, the          
   interest-bearing accounts, in which Distributions are invested. Neither the
   Company nor the Reinvestment Agent shall be liable for any act done in good
    faith, or for any good faith omission to act, including, without limitation,
any claims of liability (a) arising out of the failure to terminate a   
    Participant's participation in the Reinvestment Plan upon such Participant's
    death prior to receipt of notice in writing of such death and the expiration
  of 15 days from the date of receipt of such notice and (b) with respect to
the time and the prices at which Shares are purchased for a Participant.
  Notwithstanding the foregoing, liability under the federal securities laws
cannot be waived. Similarly, the Company and the Reinvestment Agent have
   been advised that in the opinion of certain state securities commissioners,

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  indemnification is also considered contrary to public policy and therefore
unenforceable.                                                          

6.  Reports to Participants.  Within 60 days after the end of each fiscal       
    quarter, the Reinvestment Agent will mail to each Participant a statement of
account describing, as to such Participant, the Distributions received  
  during the quarter, the number of Shares purchased during the quarter, the
    per Share purchase price for such Shares, the total administrative charge to
such Participant, and the total Shares purchased on behalf of the       
 Participant pursuant to the Reinvestment Plan. Tax information for income
earned on Shares under the Reinvestment Plan will be sent to each       
participant by the Company or the Reinvestment Agent at least annually. 

7.  Administrative Charges, Commissions, and Plan Expenses.  In connection with 
   Shares purchased by Participants in the Reinvestment Plan, the Company will
  pay a dealer-manager fee of 2.0%, and, in the event that proceeds from the
  sale of Shares to Participants are used to acquire properties, acquisition
   and advisory fees and expenses of 3.2% of the purchase price of the Shares.
    The administrative charge for each Participant for each fiscal quarter shall
  be the lesser of 5% of the amount reinvested for the Participant or $2.50,
  with a minimum charge of $0.50. The maximum charge is $10.00. Any interest
    earned on Distributions will be paid to the Company to defray costs relating
to the Reinvestment Plan. Except as provided in this Paragraph 8, the   
Company shall be responsible for all administrative charges and expenses
charged by the Reinvestment Agent.                                      

8.  No Drawing.  No Participant shall have any right to draw checks or drafts   
   against his account or give instructions to the Company or the Reinvestment
Agent except as expressly provided herein.                              

9.  Taxes.  Taxable Participants may incur a tax liability for Distributions    
made with respect to such Participant's Shares, even though they have   
   elected not to receive their Distributions in cash but rather to have their
Distributions held in their account under the Reinvestment Plan.        

10. Termination.                                                                

  (a) A Participant may terminate his participation in the Reinvestment Plan
        at any time by written notice to the Reinvestment Agent. To be effective
      for any Distribution, such notice must be received by the Reinvestment
    Agent at least ten business days prior to the last day of the fiscal
quarter to which such Distribution relates.                     

(b) The Company or the Reinvestment Agent may terminate a Participant's 
individual participation in the Reinvestment Plan, and the      

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      Company may terminate the Reinvestment Plan itself, at any time by ten
days' prior written notice mailed to a Participant, or to all   
      Participants, as the case may be, at the address or addresses shown on
      their account or such more recent address as a Participant may furnish
to the Company in writing.                                      

(c) After termination of the Reinvestment Plan or termination of a      
      Participant's participation in the Reinvestment Plan, the Reinvestment
 Agent will send to each Participant (i) a statement of account in
        accordance with Section 6 hereof, and (ii) a check for (a) the amount of
 any Distributions in the Participant's account that have not been
reinvested in Shares, and (b) the value of any fractional Shares
     standing to the credit of a Participant's account based on the market
       price of the Shares. The record books of the Company will be revised to
        reflect the ownership of record of the Participant's full Shares and any
     future Distributions made after the effective date of the termination
will be sent directly to the former Participant.                

11. Notice.  Any notice or other communication required or permitted to be given
by any provision of this Reinvestment Plan shall be in writing and      
addressed, if to the Company:                                           

Investor Services Department                                            
Boston Capital Real Estate Investment Trust, Inc.                       
c/o Boston Capital Corporation                                          
One Boston Place                                                        
Boston, MA 02108-4406                                                   

if to the Reinvestment Agent:                                           

Boston Capital Securities, Inc.                                         
One Boston Place                                                        
Boston, MA 02108-4406                                                   

or to such other addresses as may be specified by written notice to all 
  Participants. Notices to a Participant may be given by letter addressed to
the Participant at the Participant's last address of record with the    
 Company. Each Participant shall notify the Company promptly in writing of
any change of address.                                                  

12. Amendment.  The terms and conditions of this Reinvestment Plan may be       
  amended or supplemented by an agreement between the Reinvestment Agent and
 the Company at any time, including but not limited to an amendment to the
Reinvestment Plan to add a voluntary cash contribution feature or to    
   substitute a new Reinvestment Agent to act as agent for the Participants or
   to increase the administrative charge payable to the Reinvestment Agent, by
mailing an appropriate                                                  

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notice at least 30 days prior to the effective date thereof to each     
    Participant at his last address of record; provided, that any such amendment
   must be approved by a majority of the independent directors of the Company.
  Such amendment or supplement shall be deemed conclusively accepted by each
    Participant except those Participants from whom the Company receives written
notice of termination prior to the effective date thereof.              

13. Governing Law.  THIS REINVESTMENT PLAN AND A PARTICIPANT'S ELECTION TO      
 PARTICIPATE IN THE REINVESTMENT PLAN SHALL BE GOVERNED BY THE LAWS OF THE
   COMMONWEALTH OF MASSACHUSETTS; PROVIDED, HOWEVER, THAT CAUSES OF ACTION FOR
    VIOLATIONS OF FEDERAL OR STATE SECURITIES LAWS SHALL NOT BE GOVERNED BY THIS
SECTION 13.                                                             

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                                                                       EXHIBIT B

SUBSCRIPTION AGREEMENT

Boston Capital Real Estate Investment Trust, Inc.                               
c/o Boston Capital Corporation                                                  
One Boston Place, Suite 2100                                                    
Boston, Massachusetts 02108                                                     

Ladies and Gentlemen:                                                           

The undersigned, by signing and delivering a copy of the attached Subscription  
Agreement Signature Page, tenders this subscription and applies for the purchase
of the number of shares of common stock ("Shares") of Boston Capital Real Estate
Investment Trust, Inc., a Maryland corporation (the "Company"), set forth on    
such Subscription Agreement Signature Page. Payment for the Shares is hereby    
made by check payable to "Boston Private Bank & Trust Company as Custodian for  
Boston Capital REIT (BPB&TC C/F BCREIT)."                                       

The undersigned hereby acknowledges receipt of the Prospectus of the Company    
dated April   , 2006 (the "Prospectus").                                        

The undersigned agrees that if this subscription is accepted, it will be held,  
together with the accompanying payment, on the terms described in the           
Prospectus. The undersigned understands that subscriptions may be rejected in   
whole or in part by the Company in its sole and absolute discretion.            

Other than residents of Minnesota, the undersigned acknowledges that he/ she has
been advised of the following:                                                  

 (a) The assignability and transferability of the Shares is restricted and
      will be governed by the Company's Articles of Incorporation and Bylaws
and all applicable laws as described in the Prospectus.         

 (b) Prospective investors should not invest in Shares unless they have an
adequate means of providing for their current needs and personal
contingencies and have no need for liquidity in this investment.

    (c) There is no public market for the Shares and, accordingly, it may not be
possible to readily liquidate an investment in the Company.     

BY SIGNING THIS SUBSCRIPTION AGREEMENT, THE INVESTOR IS NOT WAIVING ANY RIGHTS  
THAT THE INVESTOR MAY HAVE UNDER THE SECURITIES ACT OF 1933, AS AMENDED.        

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SPECIAL NOTICE FOR CALIFORNIA RESIDENTS ONLY
CONDITIONS RESTRICTING TRANSFER OF SHARES 

260.141.11 Restrictions on Transfer.                                            

(a) The issuer of any security upon which a restriction on transfer has been    
  imposed pursuant to Sections 260.102.6, 260.141.10 or 260.534 of the Rules
(the "Rules") adopted under the California Corporate Securities Law (the
    "Code") shall cause a copy of this section to be delivered to each issuee or
transferee of such security at the time the certificate evidencing the  
security is delivered to the issuee or transferee.                      

(b) It is unlawful for the holder of any such security to consummate a sale or  
transfer of such security, or any interest therein, without the prior   
written consent of the Commissioner (until this condition is removed    
pursuant to Section 260.141.12 of the Rules), except:                   

(1) to the issuer;                                                      

(2) pursuant to the order or process of any court;                      

   (3) to any person described in subdivision (i) of Section 25102 of the Code
or Section 260.105.14 of the Rules;                             

    (4) to the transferor's ancestor, descendants or spouse, or any custodian or
        trustee for the account of the transferor or the transferor's ancestors,
       descendants or spouse; or to a transferee by a trustee or custodian for
        the account of the transferee or the transferee's ancestors, descendants
or spouse;                                                      

(5) to holders of securities of the same class of the same issuer;      

(6) by way of gift or donation INTER VIVOS or on death;                 

   (7) by or through a broker-dealer licensed under the Code (either acting as
   such or as a finder) to a resident of a foreign state, territory or
      country who is neither domiciled in this state to the knowledge of the
     broker-dealer, nor actually present in this state if the sale of such
    securities is not in violation of any securities laws of the foreign
state, territory or country concerned;                          

  (8) to a broker-dealer licensed under the Code in a principal transaction,
      or as an underwriter or member of an underwriting syndicate or selling
group;                                                          

  (9) if the interest sold or transferred is a pledge or other lien given by
     the purchaser to the seller upon a sale of the security for which the
 Commissioner's written consent is obtained or under this rule not
required;                                                       

 (10) by way of a sale qualified under Sections 25111, 25112, 25113 or 15121
of the Code, of the securities to be transferred, provided      

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        that no order under Section 25140 or subdivision (a) of Section 25143 is
in effect with respect to such qualification;                   

   (11) by a corporation to a wholly owned subsidiary of such corporation, or by
a wholly owned subsidiary of a corporation to such corporation; 

 (12) by way of an exchange qualified under Section 25111, 25112 or 25113 of
  the Code provided that no order under Section 25140 or subdivision
     (a) of Section 25143 is in effect with respect to such qualification;

(13) between residents of foreign states, territories or countries who are
neither domiciled or actually present in this state;            

   (14) to the State Controller pursuant to the Unclaimed Property Law or to the
administrator of the unclaimed property law of another state;   

   (15) by the State Controller pursuant to the Unclaimed Property Law or by the
   administrator of the unclaimed property law of another state if, in
      either such case, such person (i) discloses to potential purchasers at
       the sale that transfer of the securities is restricted under this rule,
      (ii) delivers to each purchaser a copy of this rule, and (iii) advised
the commissioner of the name of each purchaser;                 

  (16) by a trustee to a successor trustee when such transfer does not involve
a change in the beneficial ownership of the securities;         

(17) by way of an offer and sale of outstanding securities in an issuer   
transaction that is subject to the qualification requirement of 
        Section 25110 of the Code but exempt from that qualification requirement
       by subdivision (1) of Section 25102; provided that any such transfer is
       on the condition that any certificate evidencing the security issued to
  such transferee shall contain the legend required by this section.

(c) The certificates representing all such securities subject to such a         
   restriction on transfer, whether upon initial issuance or upon any transfer
  thereof, shall bear on their face a legend, prominently stamped or printed
therein in capital letters of not less than 10-point size, reading as   
follows:                                                                

IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY, OR ANY
INTEREST THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFOR, WITHOUT THE 
 PRIOR WRITTEN CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE STATE OF
CALIFORNIA, EXCEPT AS PERMITTED IN THE COMMISSIONER'S RULES.            

[LAST AMENDED EFFECTIVE JANUARY 21, 1988.]                                      

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SPECIAL NOTICE FOR MAINE, MASSACHUSETTS, MINNESOTA, 
MISSOURI AND NEBRASKA RESIDENTS ONLY

In no event may a subscription for Shares be accepted until at least five       
business days after the date the subscriber receives the Prospectus. Residents  
of the States of Maine, Massachusetts, Minnesota, Missouri and Nebraska who     
first received the Prospectus only at the time of subscription may receive a    
refund of the subscription amount upon request to the Company within five days  
of the date of subscription.                                                    

INSTRUCTIONS TO SUBSCRIPTION AGREEMENT SIGNATURE PAGE 
TO BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, ENC., 
SUBSCRIPTION AGREEMENT

                                                                [Download Table]

-------------------------------------------------------------------------
                                                                         
INVESTOR INSTRUCTIONS   Please follow these instructions carefully.      
                        Failure to do so may result in the rejection of  
                        your subscription. All information on the        
                        Subscription Agreement Signature Page should be  
                        completed as follows:                            
-------------------------------------------------------------------------
1. INVESTMENT           Please mark if this is an initial investment or  
                        additional investment. All additional investments
                        must be in increments of at least $100.          
                        Additional investments by residents of Maine must
                        be for at least the $1,000 minimum amount, and   
                        residents of Maine must execute a new            
                        Subscription Agreement Signature Page to make    
                        additional investments in the Company. If        
                        additional investments in the Company are made,  
                        the investor agrees to notify the Company and the
                        broker-dealer named on the Subscription Agreement
                        Signature Page in writing if at any time he or   
                        she fails to meet the applicable suitability     
                        standards or is unable to make any other         
                        representations or warranties set forth in the   
                        Prospectus or the Subscription Agreement. A      
                        minimum investment of $1,000 (100 shares) is     
                        required, except for certain states which require
                        a higher minimum investment. Certain States may  
                        vary. See Prospectus. A CHECK FOR THE FULL       
                        PURCHASE PRICE OF THE SHARES SUBSCRIBED FOR      
                        SHOULD BE MADE PAYABLE TO THE ORDER OF "BOSTON   
                        PRIVATE BANK & TRUST COMPANY as Custodian for    
                        Boston Capital REIT (BPB&TC C/F BCREIT)." Shares 
                        may be purchased only by persons meeting the     
                        standards set forth under the "Investor          
                        Suitability Standards" section of the Prospectus.
                        Please indicate the state in which the sale was  
                        made. WE WILL NOT ACCEPT CASH, MONEY ORDERS OR   
                        TRAVELERS CHECKS FOR INITIAL INVESTMENTS.        

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                                                                [Download Table]
                                                                         
2. TYPE OF OWNERSHIP    Please check the appropriate box to indicate the 
                        type of entity or type of individuals            
                        subscribing.                                     
-------------------------------------------------------------------------
3. REGISTRATION NAMES   Please enter the exact name in which the Shares  
   AND CONTACT          are to be held. For joint tenants with right of  
   INFORMATION          survivorship or tenants in common, include the   
                        names of both investors. In the case of          
                        partnerships or corporations, include the name of
                        an individual to whom correspondence will be     
                        addressed. Trusts should include the name of the 
                        trustee along with the title, signature and      
                        successor trustee pages. All investors must      
                        complete the space provided for taxpayer         
                        identification number or social security number. 
                        By signing in Section 5 of the Subscription      
                        Agreement Signature Page, the investor is        
                        certifying that this number is correct. Enter the
                        mailing address and telephone numbers of the     
                        registered owner of this investment. In the case 
                        of a Qualified Plan or trust, this will be the   
                        address of the trustee. Indicate the birthdate   
                        and occupation of the registered owner unless the
                        registered owner is a partnership, corporation or
                        trust.                                           
-------------------------------------------------------------------------
4. DIVIDEND             a. DIVIDEND REINVESTMENT PLAN: By electing to    
   DISTRIBUTIONS           participate in the Dividend Reinvestment Plan,
                           the investor elects to reinvest 100 percent of
                           dividends otherwise payable to such investor  
                           in Shares of the Company. The investor agrees 
                           to notify the Company and the broker-dealer   
                           named on the Subscription Agreement Signature 
                           Page in writing if at any time he or she fails
                           to meet the applicable suitability standards  
                           or is unable to make any other representations
                           and warranties as set forth in the prospectus 
                           or Subscription Agreement.                    
                        b. DIVIDEND ADDRESS: If cash dividends are to be 
                           sent to an address other than that provided in
                           Section 3 (i.e., a bank, brokerage firm or    
                           savings and loan, etc.), please provide the   
                           name(s), account number(s) and address(es).   
-------------------------------------------------------------------------
5. SUBSCRIBER           Each investor must initial each representation in
   SIGNATURES           this Section, and then sign and date this        
                        Section. By initialing and signing, each investor
                        is agreeing that the representations in this     
                        Section are true. Except in the case of fiduciary
                        accounts, the investor may not grant any person a
                        power of attorney to make such representations on
                        his or her behalf. If title is to be held        
                        jointly, all parties must initial and sign. If   
                        the registered owner is a partnership,           
                        corporation or trust, a general partner, officer 
                        or trustee of the entity must initial and sign.  
                        PLEASE NOTE THAT THESE SIGNATURES DO NOT HAVE TO 
                        BE NOTARIZED.                                    

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                                                                [Download Table]
                                                                         
-------------------------------------------------------------------------
6. BROKER-DEALER        This Section is to be completed by the Registered
                        Representative. Please complete all BROKER-DEALER
                        information contained in Section 6 including     
                        suitability certification. SIGNATURE PAGE MUST BE
                        SIGNED BY AN AUTHORIZED REPRESENTATIVE.          
-------------------------------------------------------------------------

The Subscription Agreement Signature Page, which has been delivered with the    
Prospectus, together with a check for the full purchase price, should be        
delivered or mailed to Boston Capital Real Estate Investment Trust, Inc.: if    
sent by U.S. Mail, PO Box 55449, Boston, Massachusetts 02205; if sent by        
overnight express mail, c/o Boston Capital, Suite 2100, One Boston Place,       
Boston, Massachusetts 02108. Only original, completed copies of Subscription    
Agreement Signature Pages can be accepted. Photocopies or otherwise duplicate   
Subscription Agreement Signature Pages cannot be accepted by the Company.       

IF YOU NEED FURTHER ASSISTANCE IN COMPLETING THE
SUBSCRIPTION AGREEMENT SIGNATURE PAGE,
PLEASE CALL 1-800-866-2282

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                     Boston Capital Real Estate Investment Trust, Inc.
         Subscription Agreement Signature Page
                             ---------------------------------------------------

1. Investment                                                                   

This is an / / Initial Investment / / Additional Investment                     

Make Investment Check Payable to:                                               

Boston Private Bank & Trust Company as Custodian for Boston Capital REIT        

Abbreviation: (BPBTC C/F BCREIT)                                                

This subscription is in the amount of $__________________ for the               
purchase of __________________ Shares ($10.00 per Share). The minimum           
initial investment amount is 100 Shares ($1,000), with additional               
investment increments of 10 shares ($100). Certain states may vary. See         
prospectus.                                                                     

State in which sale was made if other than state of residence                   
____________                                                                    

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

2. Type of Ownership                                                            

                                                        [Enlarge/Download Table]
                                                                                                                 
/ /  Individual                     / /  Community Property                  / /  Custodian: As Custodian for    
/ /  Joint Tenants With Right of    / /  Partnership                                                             
    Survivorship                                                                                                 
/ /  Tenants in Common              / /  A Married Person Separate Property      Under the Uniform Gift to Minors
                                                                                 Act,                            
/ /  Transfer on Death*             / /  IRA** Type:                             State of                        
/ /  Trust Type:                    / /  Keogh**                                 Under the Uniform Transfers to  
                                                                                 Minors Act,                     
    (please specify, i.e., Family,  / /  Qualified Pension Plan**                State of                        
    Living,                                                                                                      
    Revocable, etc.)                / /  Qualified Profit Sharing Plan**     / /  Other                          
/ /  Corporation                    / /  Charitable Remainder Trust                                              
/ /  Company                        / /  Non Profit Organization                                                 

*Investors who qualify may elect Transfer on Death (TOD) registration for       
such investment account. TOD registration is designed to give an                
owner/investor of securities the option of a nonprobate transfer at death       
of the assets held in the account by designating proposed                       
beneficiary(ies) to receive the account assets upon the owner/investor's        
death. TOD registration is available only for owner(s)/investor(s) who          
(1) is a natural person or (2) two natural persons holding the account as       
Tenants by the Entirety or (3) two or more natural persons holding the          
account as Joint Tenants with Right of Survivorship or (4) a married            
couple holding the account as community property with right of                  
survivorship. The following forms of ownership are ineligible for TOD           
registration: Tenants in Common, community property without survivorship,       
non-natural account owners (i.e., entities such as corporations, trusts         
or partnerships), and investors who are not residents of a state that has       
adopted the Uniform Transfer on Death Security Registration Act. A              
separate Registration Form is required for TOD registration of an               
account.                                                                        

**Investors who are plan participants under a registered IRA, Keogh,            
Qualified Pension Plan or Qualified Profit Sharing Plan program may be          
eligible to purchase such investment through such accounts. No                  
representations are made, and the offeror disclaims any responsibility or       
liability to the plan custodian, plan administrators, plan participants,        
investors, or beneficiaries thereof as to the tax ramifications of such         
investment, the suitability or eligibility of such investment under the         
respective plan, or that such Investment comports with ERISA, Internal          
Revenue Service or other governmental rules and regulations pertaining to       
such plan investments and rights thereunder. A separate private                 
investment form or similar documentation from the Plan                          
Custodian/Administrator and plan participants/investors is required for         
investment through these types of accounts.                                     

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

3. Registration Name(s) and Contact Information                                 

Please print name(s) in which Shares are to be registered. Include custodian or 
trust name if applicable.                                                       

/ / Mr. / / Mrs. / / Ms. / / Mr. & Mrs. / / Other __________________            

                                                                [Download Table]
                                                                                  

                                                             *                    
1st Registration  Last Name/Entity  First Name  Middle Name   Mother's Maiden Name
                                                             *                    
2nd Registration  Last Name/Entity  First Name  Middle Name   Mother's Maiden Name
                                                             *                    
3rd Registration  Last Name/Entity  First Name  Middle Name   Mother's Maiden Name

                                                                [Download Table]
                                                                               
Investor                                                Investor Date of Birth/
Social Security Number  -  -  or Taxpayer ID Number  -  Incorporation          

                                                                [Download Table]
                                                                 
Legal Address (no P.O. Box)                                      

Mailing Address                                                  

City                         State                     Zip Code  

Daytime Telephone No. ()     Evening Telephone No. ()            

Email Address                                                    

/ / Check here if you consent to receive all available statements and documents 
electronically in accordance with and as described in the Prospectus.           

/ / U.S. Citizen        / / Resident Alien        / / Non-Resident Alien        

Custodian Information (if registered under IRA, Keogh, or Qualified Retirement  
Plan)                                                                         

                                                                [Download Table]
                                      
Name of Institution                   

Street Address                        

City                 State  Zip Code  

                                                                [Download Table]
                                                   
Telephone No. ()  Account No. Taxpayer ID Number  -

*Mother's Maiden Name Requested for Security Purposes                           

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4. Dividend Distributions                                                       

You may choose to have your dividend distribution applied in different ways.    
Please indicate your preference below. The total amounts must equal 100%.       

Allocation %                                                                    

                                                        [Enlarge/Download Table]
                                                                                                       
   / /    I would like to participate in the Dividend Reinvestment Plan. In order to participate in the
          Dividend Reinvestment Plan, you must reinvest 100% of your dividend.                         

   OR                                                                                                  

%  / /    I prefer to receive a dividend check at my mailing address listed in Section 3.              

   / /    I prefer for my dividend to be deposited into third-party account(s).                        

%  1st Institution Name                                     Account Name                               

   Institution ABA#                                         Account Number                             

%  2nd Institution Name                                     Account Name                               

   Institution ABA#                                         Account Number                             

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5. Subscriber Signatures                                                        

The undersigned certifies, under penalty of perjury (i) that the taxpayer       
identification number shown on the Subscription Agreement Signature Page is     
true, correct and complete, and (ii) that he/she is not subject to backup       
withholding either because he/she has not been notified that he/she is subject  
to backup withholding as a result of a failure to report all interest or        
distributions, or the Internal Revenue Service has notified him/her that he/she 
is no longer subject to backup withholding.                                     

The undersigned further acknowledges and/or represents (or in the case of       
fiduciary accounts, the person authorized to sign on such investor's behalf) the
following (ALL appropriate lines must be initialed):                            

                                                        [Enlarge/Download Table]

       Primary         Secondary                                                                   
      Investor         Investor                                                                    
      (initial)        (initial)                                                                   
---------------------  ---------                                                                   
                                                                                                   
                                  (a)  acknowledges receipt, not less than five (5) business days  
                                       prior to the signing of this Subscription Agreement, of the 
                                       Prospectus of the Company relating to the Shares wherein the
                                       terms and conditions of the offering of the Shares are      
                                       described, including among other things, the restriction on 
                                       ownership and transfer of Shares, which require, under      
                                       certain circumstances, that a holder of Shares shall give   
                                       written notice and provide certain information to the       
                                       Company (Minnesota and Massachusetts residents do not       
                                       initial);                                                   
                                  (b)  represents that I (we) either: (i) have a net worth         
                                       (excluding home, home furnishings and automobiles) of at    
                                       least $45,000 and estimate that (without regard to          
                                       investment in the Company) I (we) have gross income due in  
                                       the current year of at least $45,000; or (ii) have a net    
                                       worth (excluding home, home furnishings and automobiles) of 
                                       at least $150,000 or such higher suitability as may be      
                                       required by certain states and set forth in the "Investor   
                                       Suitability Standards" section of the Prospectus; in the    
                                       case of sales to fiduciary accounts, suitability standards  
                                       must be met by the beneficiary, the fiduciary account or by 
                                       the donor or grantor who directly or indirectly supplies the
                                       funds for the purchase of the Shares;                       
                                  (c)  represents that the investor is purchasing the Shares for   
                                       his or her own account and if I am (we are) purchasing      
                                       Shares on behalf of a trust or other entity of which I am   
                                       (we are) trustee(s) or authorized agent(s) I (we) have due  
                                       authority to execute the Subscription Agreement Signature   
                                       Page and do hereby legally bind the trust or other entity of
                                       which I am (we are) trustee(s) or authorized agent(s);      
                                  (d)  acknowledges that the Shares are not liquid; (Massachusetts 
                                       residents do not initial) and                               
                                  (e)  if an affiliate of the Company, represents that the Shares  
                                       are being purchased for investment purposes only and not    
                                       with a view toward immediate resale.                        

                                                                [Download Table]
                                                                                
   Date                                                                         

                                            ------------------------------------
   ------------------------------------     (Print Name of Joint Owner, if      
   (Print Name of Investor or Trustee)      applicable)                         

   Authorized Signature (Investor or                                            
   Trustee)                                 Signature Joint Owner, if applicable
X                                        X                                      

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6. Broker-Dealer (to be completed by registered representative)                 

The Broker-Dealer or authorized representative must sign below to complete      
order. Broker-Dealer warrants that it is a duly licensed Broker-Dealer and may  
lawfully offer Shares in the state designated as the investor's address or the  
state in which the sale was made, if different. The Broker-Dealer or authorized 
representative warrants that he/she has (a) reasonable grounds to believe this  
investment is suitable for the subscriber as defined in Section 3(b) of the     
Rules of Fair Practice of the NASD Manual (b) has informed subscriber of all    
aspects of liquidity and marketability of this investment as required by        
Section 4 of such Rules of Fair Practice and (c) delivered the Prospectus to the
investor at least five days prior to the date that the investor will deliver    
this subscription agreement to the Boston Capital REIT.                         

                                                        [Enlarge/Download Table]
                                                                                                                
  Broker-Dealer Name                                                          Telephone No.                     

  Home Office Street Address                                                                                    

  City                                  State                                 Zip Code                          
------------------------------------  ------------------------------------  ------------------------------------

 Supervisor Signature, if required                                                                              

  Registered Representative Name                                              Telephone No.                     
  Street Address                                                                                                
  City                                  State                                 Zip Code                          

 Registered Representative Signature              Registered Representative Email                               

/ / Check this box to indicate whether this submission was solicited or         
recommended by an investment advisor/broker-dealer whose agreement with the     
subscriber includes a fixed or "wrap" fee feature for advisory and related      
brokerage services, and, accordingly, may not charge the regular selling        
commission. That box must be checked in order for such subscribers to purchase  
shares net of the selling commissions.                                          

Please mail completed Subscription Agreement Signature Page (with all 
signatures) and 
check(s) made payable to Boston Private Bank & Trust Company as Custodian for 
Boston Capital REIT (BPBTC C/F BCREIT) to:

If sent by U.S. Mail: Boston Capital Real Estate Investment Trust, Inc., PO BOX 
55449, Boston, MA 02205 

If sent by Overnight Express Mail: Boston Capital Real Estate Investment
Trust, Inc.,
Boston Capital, One Boston Place, Suite 2100, Boston, MA 02108-4406 

                                                                [Download Table]
                                                                           
FOR COMPANY USE ONLY:                                                      

ACCEPTANCE BY COMPANY                Amount                       Date     
Received and Subscription Accepted:  Check No.                             
Boston Capital                                                             
                                     Broker-Dealer #                       
By:                                                                        
                                     Registered Representative #  Account #

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                                                                [Download Table]
                                                                    
Prospectus                                                 [GRAPHIC]

Until September 29, 2005, 90 days after the date of this prospectus, all dealers
that buy, sell or trade our common stock, whether or not participating in this  
offering, may be required to deliver a prospectus. This requirement is in       
addition to the dealers' obligation to deliver a prospectus when acting as      
underwriters and with respect to their unsold allotments or subscriptions.      

2,950,000 Shares (Minimum Offering) 
105,000,000 Shares (Maximum Offering) 

BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC. 

COMMON STOCK

BOSTON CAPITAL SECURITIES, INC. 
AUGUST 1, 2005

PROSPECTUS

                                                                [Download Table]

                                                             PAGE
                                                                 
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS...........   8 
PROSPECTUS SUMMARY..........................................   9 
RISK FACTORS................................................  26 
INVESTOR SUITABILITY STANDARDS..............................  44 
ESTIMATED USE OF PROCEEDS...................................  46 
DIVIDEND POLICY.............................................  49 
BUSINESS AND PROPERTIES.....................................  50 
SELECTED FINANCIAL DATA.....................................  95 
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION      
  AND RESULTS OF OPERATIONS.................................  96 
MANAGEMENT.................................................. 107 
COMPENSATION AND FEES....................................... 122 
CONFLICTS OF INTEREST....................................... 132 
INVESTMENT POLICIES AND POLICIES WITH RESPECT TO CERTAIN         
  OTHER ACTIVITIES.......................................... 138 
PRIOR PERFORMANCE OF AFFILIATES OF MANAGEMENT............... 143 
PRINCIPAL STOCKHOLDERS...................................... 147 
DESCRIPTION OF CAPITAL STOCK................................ 147 
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS.... 159 
SUMMARY OF REINVESTMENT PLAN................................ 181 
SHARE REDEMPTION PROGRAM.................................... 183 
SELLING AND ESCROW ARRANGEMENTS............................. 185 
SUPPLEMENTAL SALES MATERIAL................................. 192 
EXPERTS..................................................... 193 
LEGAL MATTERS............................................... 193 
WHERE YOU CAN FIND MORE INFORMATION......................... 193 
INDEX TO FINANCIAL STATEMENTS............................... F-1 
APPENDIX I: TABULAR INFORMATION CONCERNING PRIOR LIMITED         
  PARTNERSHIPS.............................................. I-1 
EXHIBIT A: REINVESTMENT PLAN................................ A-1 
EXHIBIT B: SUBSCRIPTION AGREEMENT........................... B-1 

[GRAPHIC] 

Member NASD, SIPC 
One Boston Place, Suite 2100
Boston, MA 02108-4406 
(617) 624-8900 or (800) 866-2282
www.bostoncapital.com 

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PART II 

INFORMATION NOT REQUIRED IN PROSPECTUS

  Items 31, 32 and 35 are incorporated by reference from Amendment No. 10 to
the Registrant's Registration Statement on Form S-11, as filed on April 26,     
2005.                                                                           

ITEM 33.  RECENT SALES OF UNREGISTERED SECURITIES.                              

   On January 30, 2006, we consummated the closing of an unregistered offering
of 12.0% Series A Cumulative Non-Voting Preferred Stock at $500 per share. The  
preferred share offering was effected pursuant to the articles supplementary to 
our articles of incorporation. The preferred share offering was conducted in    
reliance on the exemption from registration set forth in Section 4(2) of the    
Securities Act of 1933, as amended, and Rule 506 of Regulation D promulgated    
thereunder. The preferred shares were offered and sold by us to investors whom  
we had reasonable grounds to believe are "accredited investors" within the      
meaning of Rule 501 of Regulation D. The preferred share offering was effected  
by us for the purpose of having at least 100 shareholders to satisfy one of the 
qualifications we must meet in order to qualify as a REIT under the Internal    
Revenue Code. Under Sections 856(a)(5), 856(b) and 856(h)(2) of the Internal    
Revenue Code, the beneficial ownership of a REIT must be held by 100 or more    
persons during at least 335 days of a taxable year of 12 months (or during a    
proportionate part of a taxable year of less than 12 months), other than with   
respect to the first taxable year for which a REIT election is made (which in   
our case is anticipated to be the taxable year ended December 31, 2005). The    
outstanding preferred shares are subject to redemption, in whole or in part, at 
any date which is at least one year following the sale of such preferred shares 
by notice of such redemption by us. If we elect to redeem the preferred shares, 
each preferred share will be redeemed for a price, payable in cash on the       
redemption date, equal to $500, plus all accrued and unpaid dividends. We sold a
total of 173 preferred shares in the preferred share offering representing total
gross proceeds of $86,500. No selling commissions were paid in connection with  
the preferred share offering.                                                   

    On May 2, 2003, in connection with our formation, we issued 20,000 shares of
our common stock to Boston Capital Companion Limited Partnership, an affiliate  
of the Advisor, for an aggregate consideration of $200,000 ($10 per share), in  
cash. No underwriter was involved. The sale was made in reliance upon an        
exemption from the registration provisions of the Securities Act set forth in   
Section 4(2) thereof and the rules and regulations thereunder. Section 4(2)     
provides an exemption from registration for an isolated sale of securities by an
issuer (us) to a single purchaser (Boston Capital Companion Limited Partnership)
in a transaction that does not involve any public offering. These shares are    
deemed restricted securities for purposes of the Securities Act. Currently, John
P. Manning, through his ownership of the general partner of Boston Capital      
Companion Limited Partnership, has voting control over these shares.            

ITEM 34.  INDEMNIFICATION OF DIRECTORS AND OFFICERS.                            

Our charter contains a provision permitted under Maryland General       
Corporation Law eliminating, with limited exceptions, each director's personal  
liability for monetary damages for breach of any duty as a director. In         
addition, our charter documents require us to indemnify our directors from      
specified liabilities and expenses, as well as advancement of costs, expenses   
and attorneys' fees, to the fullest extent permitted under Maryland General     
Corporation Law.                                                                

   Pursuant to our articles, we have entered into agreements indemnifying each
director for personal losses or liability reasonably incurred by the director in
connection with any act or omission performed or omitted to be performed on     
behalf of the Company, provided that the director has determined in good faith, 
that the course of conduct which caused the loss, or liability was in the best  
interests of the Company. Such indemnification is subject to the conditions and 
limitations imposed by Article II.G of                                          

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the NASAA Guidelines and the Maryland General Corporation Law. Among the        
conditions and limitations on indemnification are requirements that the loss or 
liability not be caused by the negligence or misconduct by a non-independent    
director or the gross negligence or willful misconduct of an independent        
director and that the act or omission that was material to the loss or liability
was not committed in bad faith or was not the result of active or deliberate    
dishonesty. In addition, our articles and the indemnification agreements provide
for the advancement of costs, expenses and attorneys' fees, in accordance with  
the procedures under the Maryland General Corporation Law and subject to the    
NASAA Guidelines. These rights are contract rights fully enforceable by each    
beneficiary.                                                                    

    Furthermore, subject to the NASAA Guidelines, our officers and directors are
indemnified against specified liabilities by the soliciting dealers, and the    
soliciting dealers are indemnified against certain liabilities by us, under the 
soliciting dealer agreements relating to this offering and for specified        
liabilities and expenses pursuant to the advisory services agreement between us 
and our advisor. See "Indemnification." In addition, we are indemnified for     
specified liabilities and expenses pursuant to the advisory services agreement  
between us and the Advisor, Boston Capital REIT Advisors, LLC.                  

ITEM 36.  FINANCIAL STATEMENTS, FINANCIAL STATEMENT SCHEDULE AND EXHIBITS.      

(a) Financial Statements: See page F-1 for an index of the financial    
statements included in the Registration Statement.                

(b) Financial Statement Schedule.                                       

(c) Exhibits.                                                           

EXHIBITS                                                                        

                                                                [Download Table]

NUMBER                         DESCRIPTION OF DOCUMENT                   
------       ------------------------------------------------------------
                                                                         
       1.1   Form of Dealer-Manager Agreement between Boston Capital     
             Securities, Inc., and the Registrant (PREVIOUSLY FILED AS   
             EXHIBIT 1.1 TO THE REGISTRATION STATEMENT ON FORM S-11 (FILE
             NO. 333-108426) ON JULY 19, 2005 AND INCORPORATED HEREIN BY 
             REFERENCE.)                                                 

       3.1   Articles of Amendment and Restatement of the Registrant     
             (PREVIOUSLY FILED AS EXHIBIT 3.1 TO THE REGISTRATION        
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON JUNE 16,    
             2005 AND INCORPORATED HEREIN BY REFERENCE.)                 

       3.2   By-Laws of the Registrant (PREVIOUSLY FILED AS EXHIBIT 3.2  
             TO THE REGISTRATION STATEMENT ON FORM S-11 (FILE            
             NO. 333-108426) ON JUNE 16, 2005 AND INCORPORATED HEREIN BY 
             REFERENCE.)                                                 

       3.3   Limited Liability Company Agreement of BC-GFS, LLC          
             (PREVIOUSLY FILED AS EXHIBIT 3.5 TO THE REGISTRATION        
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON OCTOBER 4,  
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

       3.4   Amendment No. 1 to BC-GFS LLC Limited Liability Company     
             Agreement (PREVIOUSLY FILED AS EXHIBIT 3.6 TO THE           
             REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
             JANUARY 24, 2005 AND INCORPORATED HEREIN BY REFERENCE.)     

       4.1   Form of Common Stock Certificate of the Registrant          
             (PREVIOUSLY FILED AS EXHIBIT 4.1 TO THE REGISTRATION        
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON             
             DECEMBER 22, 2003 AND INCORPORATED HEREIN BY REFERENCE.)    

       4.2*  Form of Subscription Agreement and Subscription Agreement   
             Signature Page (INCLUDED AS EXHIBIT B TO THE PROSPECTUS)    

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NUMBER                            DESCRIPTION OF DOCUMENT                   
------          ------------------------------------------------------------
                                                                            
       4.3      Articles Supplementary relating to 12.0% Series A Cumulative
                Non-Voting Preferred Stock of the Registrant (PREVIOUSLY    
                FILED AS EXHIBIT 4.1 TO THE CURRENT REPORT ON FORM 8-K FILED
                ON FEBRUARY 3, 2006, AND INCORPORATED HEREIN BY REFERENCE.) 

       5.1      Opinion of Goodwin Procter LLP with respect to the legality 
                of the shares being registered (PREVIOUSLY FILED AS         
                EXHIBIT 5.1 TO POST-EFFECTIVE AMENDMENT NO. 2 TO THE        
                REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
                DECEMBER 7, 2005 AND INCORPORATED HEREIN BY REFERENCE.)     

       8.1*     Opinion of Goodwin Procter LLP with respect to tax matters  

      10.1      2004 Equity Incentive Plan (PREVIOUSLY FILED AS             
                EXHIBIT 10.1 TO THE REGISTRATION STATEMENT ON FORM S-11     
                (FILE NO. 333-108426) ON JANUARY 24, 2005 AND INCORPORATED  
                HEREIN BY REFERENCE.)                                       

      10.2      Forms of Option Agreement and Restricted Stock Grant        
                Agreement under the 2004 Equity Incentive Plan (PREVIOUSLY  
                FILED AS EXHIBIT 10.2 TO THE REGISTRATION STATEMENT ON      
                FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
                INCORPORATED HEREIN BY REFERENCE.)                          

      10.3      Form of Independent Director Stock Option Plan (PREVIOUSLY  
                FILED AS EXHIBIT 10.3 TO THE REGISTRATION STATEMENT ON      
                FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
                INCORPORATED HEREIN BY REFERENCE.)                          

      10.4      Form of Option Agreement under the Independent Director     
                Stock Option Plan (PREVIOUSLY FILED AS EXHIBIT 10.4 TO THE  
                REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
                APRIL 9, 2004 AND INCORPORATED HEREIN BY REFERENCE.)        

      10.5(a)   Second Amended and Restated Advisory Services Agreement     
                between Boston Capital REIT Advisors, LLC, and the          
                Registrant (PREVIOUSLY FILED AS EXHIBIT 10.5 TO THE         
                REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
                JULY 19, 2005 AND INCORPORATED HEREIN BY REFERENCE.)        

      10.5(b)*  Amendment No. 1 to Second Amended and Restated Advisory     
                Services Agreement between Boston Capital REIT Advisors,    
                LLC, and the Registrant.                                    

      10.6      Loan Agreement dated as of May 31, 2003, between BCP        
                Funding, LLC, and the Registrant (PREVIOUSLY FILED AS       
                EXHIBIT 10.6 TO THE REGISTRATION STATEMENT ON FORM S-11     
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

      10.7      Pledge Agreement (LLC/LP Interests), dated as of May 31,    
                2003, between BCP Funding, LLC, and the Registrant          
                (PREVIOUSLY FILED AS EXHIBIT 10.7 TO THE REGISTRATION       
                STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
                2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.8*     Amended and Restated Share Repurchase Plan dated as of      
                April 6, 2006                                               

      10.9      Property Management Agreement, dated December 12, 2002,     
                between GFS Alderwood LLC and Pinnacle Realty Management    
                Company (Exhibits A, B & C only) (PREVIOUSLY FILED AS       
                EXHIBIT 10.91 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON SEPTEMBER 2, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

      10.10     Property Management Agreement, dated December 12, 2002,     
                between GFS Ridgetop LLC and Pinnacle Realty Management     
                Company (Exhibits A, B & C only) (PREVIOUSLY FILED AS       
                EXHIBIT 10.10 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

      10.11     Property Management Agreement, dated December 12, 2002,     
                between GFS Wellington LLC and Pinnacle Realty Management   
                Company (Exhibits A, B & C only) (PREVIOUSLY FILED AS       
                EXHIBIT 10.11 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

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NUMBER                          DESCRIPTION OF DOCUMENT                   
------        ------------------------------------------------------------
                                                                          
      10.12*  Reinvestment Plan (INCLUDED AS EXHIBIT A TO THE PROSPECTUS.)

      10.13*  Amended and Restated Escrow Agreement between Boston Private
              Bank & Trust Company and the Registrant (PREVIOUSLY FILED AS
              EXHIBIT 10.13 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON APRIL 9, 2004 AND INCORPORATED     
              HEREIN BY REFERENCE.)                                       

      10.14   Property Management Agreement, dated May 21, 2003, between  
              BC-Bainbridge Bay Pointe LLC and Bainbridge Management      
              Jacksonville LLC (Exhibits A-H) (PREVIOUSLY FILED AS        
              EXHIBIT 10.14 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON DECEMBER 22, 2003 (EXHIBITS A-G-1  
              FILED ON APRIL 9, 2004) AND INCORPORATED HEREIN BY          
              REFERENCE.)                                                 

      10.15   Property Management Agreement, dated May 21, 2003, between  
              BC-Bainbridge Timuquana LLC and Bainbridge Management       
              Jacksonville LLC (Exhibits A-H) (PREVIOUSLY FILED AS        
              EXHIBIT 10.15 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON DECEMBER 22, 2003 (EXHIBITS A-G-1  
              FILED ON APRIL 9, 2004) AND INCORPORATED HEREIN BY          
              REFERENCE.)                                                 

      10.16   Property Management Agreement, dated May 29, 2003, between  
              BC-Bainbridge Spicewood LLC and Bainbridge Management       
              Jacksonville LLC (PREVIOUSLY FILED AS EXHIBIT 10.16 TO THE  
              REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
              DECEMBER 22, 2003 AND INCORPORATED HEREIN BY REFERENCE.)    

      10.17   Property Management Agreement, dated May 29, 2003, between  
              BC-GFS Settler's Point LLC and American Management Services 
              Northwest, LLC, dba Pinnacle (PREVIOUSLY FILED AS           
              EXHIBIT 10.17 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
              HEREIN BY REFERENCE.)                                       

      10.18   Property Management Agreement, dated May 29, 2003, between  
              BC-GFS Bridge Creek LLC and American Management Services    
              Northwest, LLC, dba Pinnacle (PREVIOUSLY FILED AS           
              EXHIBIT 10.18 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
              HEREIN BY REFERENCE.)                                       

      10.19   Property Management Agreement, dated May 29, 2003, between  
              BC-GFS Boulder Creek LLC and American Management Services   
              Northwest, LLC, dba Pinnacle (PREVIOUSLY FILED AS           
              EXHIBIT 10.19 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
              HEREIN BY REFERENCE.)                                       

      10.20   Agreement for Sale and Purchase of Property (Bay Pointe     
              Apartments), dated February 11, 2003, between Vestcor-Bay   
              Pointe Partners, Ltd. and Bainbridge Communities Acquisition
              Corporation II, as amended and assigned to BC-Bainbridge Bay
              Pointe LLC (PREVIOUSLY FILED AS EXHIBIT 10.20 TO THE        
              REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
              DECEMBER 22, 2003 AND INCORPORATED HEREIN BY REFERENCE.)    

      10.21   Agreement for Sale and Purchase of Property (Oaks at        
              Timuquana Apartments), dated February 11, 2003, between     
              VCP-Timuquana Associates, Ltd. and Bainbridge Communities   
              Acquisition Corporation II, as amended and assigned to      
              BC-Bainbridge Timuquana LLC (PREVIOUSLY FILED AS            
              EXHIBIT 10.21 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
              HEREIN BY REFERENCE.)                                       

      10.22   Real Estate Sale Agreement, dated April 2, 2003, between ERP
              Operating Limited Partnership and Bainbridge Communities    
              Acquisition Corporation II, as amended and assigned to      
              BC-Bainbridge Spicewood LLC (PREVIOUSLY FILED AS            
              EXHIBIT 10.22 TO THE REGISTRATION STATEMENT ON FORM S-11    
              (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
              HEREIN BY REFERENCE.)                                       

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NUMBER                         DESCRIPTION OF DOCUMENT                   
------       ------------------------------------------------------------
                                                                         
      10.23  Real Estate Sale Agreement, dated March 27, 2003, among     
             EQR-FANCAP 2000A Limited Partnership, EQR-Bridgecreek       
             Vistas, Inc. and Goodman Financial Services, Inc. (with     
             respect to Boulder Creek and Bridge Creek), as amended      
             (PREVIOUSLY FILED AS EXHIBIT 10.23 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 FILE NO. 333-108426) ON APRIL 9, 2004
             AND INCORPORATED HEREIN BY REFERENCE.)                      

      10.24  Assignment of Real Estate Sale Agreement, dated May 2, 2003,
             from Goodman Financial Services, Inc. to BC-GFS II LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.24 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.25  Real Estate Sale Agreement, dated March 26, 2003, between   
             ERP Operating Limited Partnership and Goodman Financial     
             Services, Inc. (with respect to Settler's Point), as amended
             (PREVIOUSLY FILED AS EXHIBIT 10.25 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.26  Assignment of Real Estate Sale Agreement, dated May 2, 2003,
             from Goodman Financial Services, Inc. to BC-GFS II LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.26 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.27  Assignment of Real Estate Sale Agreement, dated May 21,     
             2003, from BC-GFS II LLC to BC-GFS Boulder Creek LLC        
             (PREVIOUSLY FILED AS EXHIBIT 10.27 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.28  Assignment of Real Estate Sale Agreement, dated May 21,     
             2003, from BC-GFS II LLC to BC-GFS Bridge Creek LLC         
             (PREVIOUSLY FILED AS EXHIBIT 10.28 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.29  Assignment of Real Estate Sale Agreement, dated May 21,     
             2003, from BC-GFS II LLC to BC-GFS Settler's Point LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.29 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 33-108426) ON APRIL 9, 2004
             AND INCORPORATED HEREIN BY REFERENCE.)                      

      10.30  Washington Portfolio Real Estate Agreement, dated July 11,  
             2002, among ERP Operating Limited Partnership, EQR-Alderwood
             Limited Partnership, EQR-Wellington, L.L.C.; and Goodman    
             Financial Services, Inc., as amended (PREVIOUSLY FILED AS   
             EXHIBIT 10.30 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON APRIL 9, 2004 AND INCORPORATED     
             HEREIN BY REFERENCE.)                                       

      10.31  Assignment of Real Estate Sale Agreement to BC-GFS LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.31 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.32  Assignment of Real Estate Sale Agreement with respect to    
             Alderwood from BC-GFS LLC to GFS Alderwood LLC (PREVIOUSLY  
             FILED AS EXHIBIT 10.32 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.33  Assignment of Real Estate Sale Agreement with respect to    
             Ridgetop from BC-GFS LLC to GFS Ridgetop LLC (PREVIOUSLY    
             FILED AS EXHIBIT 10.33 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.34  Assignment of Real Estate Sale Agreement with respect to    
             Wellington from BC-GFS LLC to GFS Wellington LLC (PREVIOUSLY
             FILED AS EXHIBIT 10.34 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

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NUMBER                         DESCRIPTION OF DOCUMENT                   
------       ------------------------------------------------------------
                                                                         
      10.35  Letter dated March 11, 2005 requesting the extension of the 
             maturity date of Loan Agreement dated as of May 31, 2003,   
             between BCP Funding, LLC and the Registrant (PREVIOUSLY     
             FILED AS EXHIBIT 10.35 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 26, 2005 AND       
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.36  Letter dated March 11, 2005 extending the maturity date of  
             Loan Agreement dated as of May 31, 2003, between BCP        
             Funding, LLC and the Registrant (PREVIOUSLY FILED AS        
             EXHIBIT 10.36 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON APRIL 26, 2005 AND INCORPORATED    
             HEREIN BY REFERENCE.)                                       

      10.37  Letter dated December 5, 2005 extending the maturity date of
             Loan Agreement dated as of May 31, 2003, between BCP        
             Funding, LLC and the Registrant (PREVIOUSLY FILED AS        
             EXHIBIT 10.37 TO POST-EFFECTIVE AMENDMENT NO. 2 TO THE      
             REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426)   
             ON DECEMBER 7, 2005 AND INCORPORATED HEREIN BY REFERENCE.)  

      10.38  Property Management Agreement for Preston at Willow Bend    
             Apartments, Plano, Texas, dated September 15, 2005, by and  
             between BC Broadstone Preston, LP and Alliance Residential, 
             LLC (PREVIOUSLY FILED AS EXHIBIT 10.1 TO THE CURRENT REPORT 
             ON FORM 8-K FILED ON SEPTEMBER 21, 2005, AND INCORPORATED   
             HEREIN BY REFERENCE.)                                       

      10.39  Loan Agreement, dated September 15, 2005, between and among 
             Wachovia Bank, National Association and ALLTX, LLC          
             (PREVIOUSLY FILED AS EXHIBIT 10.2 TO THE CURRENT REPORT ON  
             FORM 8-K FILED ON SEPTEMBER 21, 2005, AND INCORPORATED      
             HEREIN BY REFERENCE.)                                       

      10.40  Loan Extension Agreement, dated as of December 28, 2005,    
             between Wachovia Bank, National Association and ALLTX, LLC  
             (PREVIOUSLY FILED AS EXHIBIT 10.1 TO THE CURRENT REPORT ON  
             FORM 8-K FILED ON JANUARY 3, 2006, AND INCORPORATED HEREIN  
             BY REFERENCE.)                                              

      10.41  Form of Indemnification Agreement entered into by the       
             Registrant with each of its directors (PREVIOUSLY FILED AS  
             EXHIBIT 10.1 TO THE CURRENT REPORT ON FORM 8-K FILED ON     
             FEBRUARY 3, 2006, AND INCORPORATED HEREIN BY REFERENCE.)    

      23.1*  Consent of Reznick Group, P.C.                              

      23.2*  Consent of Ernst & Young LLP                                

      23.3*  Consent of Goodwin Procter LLP (included in Exhibit 5.1)    

      23.4*  Consent of Goodwin Procter LLP (included in Exhibit 8.1)    

      23.5   Consent of National Council of Real Estate Investment       
             Fiduciaries (INCLUDED IN EXHIBIT 23.5 TO POST-EFFECTIVE     
             AMENDMENT NO. 2 TO THE REGISTRATION STATEMENT ON FORM S-11  
             (FILE NO. 333-108426) ON DECEMBER 7, 2005 AND INCORPORATED  
             HEREIN BY REFERENCE.)                                       

      24.1   Power of Attorney (PREVIOUSLY FILED AS EXHIBIT 24.1 TO      
             POST-EFFECTIVE AMENDMENT NO. 2 TO THE REGISTRATION STATEMENT
             ON FORM S-11 (FILE NO. 333-108426) ON DECEMBER 7, 2005 AND  
             INCORPORATED HEREIN BY REFERENCE.)                          

      99     Table VI: Acquisition of Properties by Programs (PREVIOUSLY 
             FILED AS EXHIBIT 99 TO THE REGISTRATION STATEMENT ON        
             FORM S-11 (FILE NO. 333-108426) INITIALLY FILED ON JUNE 16, 
             2005 AND INCORPORATED HEREIN BY REFERENCE.)                 

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

*   Filed herewith.                                                             

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ITEM 37.  UNDERTAKINGS.                                                         

(a) The undersigned registrant hereby undertakes:                               

 (1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:          

 (i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;                                 

       (ii) To reflect in the prospectus any facts or events arising after the
          effective date of the registration statement (or the most recent
         post-effective amendment thereof) which, individually or in the
          aggregate, represent a fundamental change in the information set
             forth in the registration statement. Notwithstanding the foregoing,
          any increase or decrease in volume of securities offered (if the
        total dollar value of securities offered would not exceed that
             which was registered) and any deviation from the low or high end of
           the estimated maximum offering range may be reflected in the form
             of prospectus filed with the Commission pursuant to Rule 424(b) if,
             in the aggregate, the changes in volume and price represent no more
          than a 20 percent change in the maximum aggregate offering price
         set forth in the "Calculation of Registration Fee" table in the
effective registration statement;                     

   (iii) To include any material information with respect to the plan of
             distribution not previously disclosed in the registration statement
        or any material change to such information in the registration
statement.                                            

   (2) That, for the purpose of determining any liability under the Securities
     Act of 1933, each such post-effective amendment shall be deemed to be a
    new registration statement relating to the securities offered therein,
    and the offering of such securities at that time shall be deemed to be
the initial BONA FIDE offering thereof.                           

  (3) To remove from registration by means of a post-effective amendment any
       of the securities being registered which remain unsold at the termination
of the offering.                                                  

   (4) That, for the purpose of determining liability under the Securities Act
of 1933 to any purchaser:                                         

  (A) Each prospectus filed by a Registrant pursuant to Rule 424(b)(3)
        shall be deemed to be part of the registration statement as of the
      date the filed prospectus was deemed part of and included in the
registration statement; and                               

  (B) Each prospectus required to be filed pursuant to Rule 424(b)(2),
         (b)(5) or (b)(7) as part of a registration statement in reliance on
Rule 430B relating to an offering made pursuant to        
      Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the
         information required by Section 10(a) of the Securities Act of 1933
    shall be deemed to be part of and included in the registration
        statement as of the earlier of the date such form of prospectus is
         first used after effectiveness or the date of the first contract of
        sale of securities in the offering described in the prospectus. As
         provided in Rule 430B, for liability purposes of the issuer and any
           person that is at that date an underwriter, such date shall be deemed
          to be a new effective date of the registration statement relating to
          the securities in the registration statement to which the prospectus
        relates, and the offering of such securities at that time shall be
    deemed to be the initial BONA FIDE offering thereof. PROVIDED,
    HOWEVER, that no statement made in a registration statement or
        prospectus that is part of the registration statement or made in a
        document incorporated or deemed incorporated by reference into the
           registration statement or prospectus that is part of the registration
       statement will, as to a purchaser with a time of contract of sale
          prior to such effective date, supersede or modify any statement that
was                                                       

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           made in the registration statement or prospectus that was part of the
           registration statement or made in any such document immediately prior
to such effective date.                                   

    (5) That, for the purpose of determining liability of a Registrant under the
    Securities Act of 1933 to any purchaser in the initial distribution of
      the securities, each undersigned Registrant undertakes that in a primary
  offering of securities of an undersigned Registrant pursuant to this
   registration statement, regardless of the underwriting method used to
    sell the securities to the purchaser, if the securities are offered or
     sold to such purchaser by means of any of the following communications,
      the undersigned Registrant will be a seller to the purchaser and will be
considered to offer or sell such securities to such purchaser:    

(i) Any preliminary prospectus or prospectus of an undersigned  
            Registrant relating to the offering required to be filed pursuant to
Rule 424;                                               

        (ii) Any free writing prospectus relating to the offering prepared by or
             on behalf of an undersigned Registrant or used or referred to by an
undersigned Registrant;                               

    (iii) The portion of any other free writing prospectus relating to the
       offering containing material information about an undersigned
     Registrant or its securities provided by or on behalf of an
undersigned Registrant; and                           

        (iv) Any other communication that is an offer in the offering made by an
undersigned Registrant to the purchaser.              

(b) That, for purposes of determining any liability under the Securities Act of 
1933, each filing of the registrant's annual report pursuant to         
 Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where
    applicable, each filing of an employee benefit plan's annual report pursuant
to Section 15(d) of the Securities Exchange Act of 1934) that is        
  incorporated by reference in the registration statement shall be deemed to
   be a new registration statement relating to the securities offered therein,
  and the offering of such securities at that time shall be deemed to be the
initial BONA FIDE offering thereof.                                     

(c) Insofar as indemnification for liabilities arising under the Securities Act 
  of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the  
registrant has been advised that in the opinion of the Securities and   
Exchange Commission such indemnification is against public policy as    
  expressed in the Act and is, therefore, unenforceable. In the event that a
  claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any   
action, suit or proceeding) is asserted by such director, officer or    
  controlling person in connection with the securities being registered, the
 Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate      
jurisdiction the question whether such indemnification by it is against 
public policy as expressed in the Act, and will be governed by the final
adjudication of such issue.                                             

(d) The registrant undertakes to file a sticker supplement pursuant to          
Rule 424(c) under the Securities Act during the distribution period     
 describing each property not identified in the prospectus at such time as
 there arises a reasonable probability that such property will be acquired
  and to consolidate all such stickers into a post-effective amendment filed
at least once every three months, with the information contained in such
    amendment provided simultaneously to the existing stockholders. Each sticker
    supplement should disclose all compensation and fees received by the Advisor
and its affiliates in connection with any such acquisition. The         
   post-effective amendment shall include audited financial statements meeting
    the requirements of Rule 3-14 of Regulation S-X only for properties acquired
during the distribution period.                                         

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(e) The registrant also undertakes to file, after the end of the distribution   
    period, a current report on Form 8-K containing the financial statements and
any additional information required by Rule 3-14 of Regulation S-X, to  
   reflect each commitment (i.e., the signing of a binding purchase agreement)
made after the end of the distribution period involving the use of      
10 percent or more (on a cumulative basis) of the net proceeds of the   
offering, and to provide the information contained in such report to the
    stockholders at least once each quarter after the distribution period of the
offering has ended.                                                     

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SIGNATURES

  Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the    
requirements for filing on Form S-11 and has duly caused this Pre-Effective     
Amendment No. 1 to Post-Effective Amendment No. 4 to its registration statement 
to be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Boston, Commonwealth of Massachusetts, on this 6th day of April 2006.   

                                                                [Download Table]
                                                     
BOSTON CAPITAL REAL ESTATE INVESTMENT TRUST, INC.    

By:  /s/ JEFFREY H. GOLDSTEIN                        
     ------------------------------------------------
     Jeffrey H. Goldstein                            
     PRESIDENT AND CHIEF OPERATING OFFICER           

    Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed below by the following persons in the    
capacities and on the dates indicated:                                          

                                                        [Enlarge/Download Table]

              SIGNATURE                              TITLE                     DATE     
              ---------                              -----                     ----     
                                                                                        
         /s/ JOHN P. MANNING          Chairman, Chief Executive Officer,                
------------------------------------    Director (principal executive      April 6, 2006
           John P. Manning              officer)                                        

      /s/ JEFFREY H. GOLDSTEIN                                                          
------------------------------------  President, Chief Operating Officer,  April 6, 2006
        Jeffrey H. Goldstein            Director                                        

                                      Senior Vice President, Chief                      
          /s/ MARC N. TEAL              Financial Officer, Treasurer,                   
------------------------------------    Secretary (principal financial     April 6, 2006
            Marc N. Teal                and accounting officer)                         

           /s/           *                                                              
------------------------------------  Director                             April 6, 2006
          Philip S. Cottone                                                             

           /s/           *                                                              
------------------------------------  Director                             April 6, 2006
         Nicholas L. Iacuzio                                                            

           /s/           *                                                              
------------------------------------  Director                             April 6, 2006
           Kevin C. Phelan                                                              

* Pursuant to Power of Attorney                                                 

                                                                [Download Table]
                                                        
*By:            /s/ JEFFREY H. GOLDSTEIN                
             -------------------------------            
                  Jeffrey H. Goldstein                  
                    ATTORNEY-IN-FACT                    

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EXHIBIT INDEX 

                                                                [Download Table]

NUMBER                         DESCRIPTION OF DOCUMENT                   
------       ------------------------------------------------------------
                                                                         
       1.1   Form of Dealer-Manager Agreement between Boston Capital     
             Securities, Inc., and the Registrant (PREVIOUSLY FILED AS   
             EXHIBIT 1.1 TO THE REGISTRATION STATEMENT ON FORM S-11 (FILE
             NO. 333-108426) ON JULY 19, 2005 AND INCORPORATED HEREIN BY 
             REFERENCE.)                                                 

       3.1   Articles of Amendment and Restatement of the Registrant     
             (PREVIOUSLY FILED AS EXHIBIT 3.1 TO THE REGISTRATION        
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON JUNE 16,    
             2005 AND INCORPORATED HEREIN BY REFERENCE.)                 

       3.2   By-Laws of the Registrant (PREVIOUSLY FILED AS EXHIBIT 3.2  
             TO THE REGISTRATION STATEMENT ON FORM S-11 (FILE            
             NO. 333-108426) ON JUNE 16, 2005 AND INCORPORATED HEREIN BY 
             REFERENCE.)                                                 

       3.3   Limited Liability Company Agreement of BC-GFS, LLC          
             (PREVIOUSLY FILED AS EXHIBIT 3.5 TO THE REGISTRATION        
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON OCTOBER 4,  
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

       3.4   Amendment No. 1 to BC-GFS LLC Limited Liability Company     
             Agreement (PREVIOUSLY FILED AS EXHIBIT 3.6 TO THE           
             REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
             JANUARY 24, 2005 AND INCORPORATED HEREIN BY REFERENCE.)     

       4.1   Form of Common Stock Certificate of the Registrant          
             (PREVIOUSLY FILED AS EXHIBIT 4.1 TO THE REGISTRATION        
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON             
             DECEMBER 22, 2003 AND INCORPORATED HEREIN BY REFERENCE.)    

       4.2*  Form of Subscription Agreement and Subscription Agreement   
             Signature Page (INCLUDED AS EXHIBIT B TO THE PROSPECTUS)    

       4.3   Articles Supplementary relating to 12.0% Series A Cumulative
             Non-Voting Preferred Stock of the Registrant (PREVIOUSLY    
             FILED AS EXHIBIT 4.1 TO THE CURRENT REPORT ON FORM 8-K FILED
             ON FEBRUARY 3, 2006, AND INCORPORATED HEREIN BY REFERENCE.) 

       5.1   Opinion of Goodwin Procter LLP with respect to the legality 
             of the shares being registered (PREVIOUSLY FILED AS         
             EXHIBIT 5.1 TO POST-EFFECTIVE AMENDMENT NO. 2 TO THE        
             REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
             DECEMBER 7, 2005 AND INCORPORATED HEREIN BY REFERENCE.)     

       8.1*  Opinion of Goodwin Procter LLP with respect to tax matters  

      10.1   2004 Equity Incentive Plan (PREVIOUSLY FILED AS             
             EXHIBIT 10.1 TO THE REGISTRATION STATEMENT ON FORM S-11     
             (FILE NO. 333-108426) ON JANUARY 24, 2005 AND INCORPORATED  
             HEREIN BY REFERENCE.)                                       

      10.2   Forms of Option Agreement and Restricted Stock Grant        
             Agreement under the 2004 Equity Incentive Plan (PREVIOUSLY  
             FILED AS EXHIBIT 10.2 TO THE REGISTRATION STATEMENT ON      
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.3   Form of Independent Director Stock Option Plan (PREVIOUSLY  
             FILED AS EXHIBIT 10.3 TO THE REGISTRATION STATEMENT ON      
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.4   Form of Option Agreement under the Independent Director     
             Stock Option Plan (PREVIOUSLY FILED AS EXHIBIT 10.4 TO THE  
             REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
             APRIL 9, 2004 AND INCORPORATED HEREIN BY REFERENCE.)        

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NUMBER                            DESCRIPTION OF DOCUMENT                   
------          ------------------------------------------------------------
                                                                            
      10.5(a)   Second Amended and Restated Advisory Services Agreement     
                between Boston Capital REIT Advisors, LLC, and the          
                Registrant (PREVIOUSLY FILED AS EXHIBIT 10.5 TO THE         
                REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
                JULY 19, 2005 AND INCORPORATED HEREIN BY REFERENCE.)        

      10.5(b)*  Amendment No. 1 to Second Amended and Restated Advisory     
                Services Agreement between Boston Capital REIT Advisors,    
                LLC, and the Registrant.                                    

      10.6      Loan Agreement dated as of May 31, 2003, between BCP        
                Funding, LLC, and the Registrant (PREVIOUSLY FILED AS       
                EXHIBIT 10.6 TO THE REGISTRATION STATEMENT ON FORM S-11     
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

      10.7      Pledge Agreement (LLC/LP Interests), dated as of May 31,    
                2003, between BCP Funding, LLC, and the Registrant          
                (PREVIOUSLY FILED AS EXHIBIT 10.7 TO THE REGISTRATION       
                STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
                2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.8*     Amended and Restated Share Repurchase Plan dated as of      
                April 6, 2006                                               

      10.9      Property Management Agreement, dated December 12, 2002,     
                between GFS Alderwood LLC and Pinnacle Realty Management    
                Company (Exhibits A, B & C only) (PREVIOUSLY FILED AS       
                EXHIBIT 10.91 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON SEPTEMBER 2, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

      10.10     Property Management Agreement, dated December 12, 2002,     
                between GFS Ridgetop LLC and Pinnacle Realty Management     
                Company (Exhibits A, B & C only) (PREVIOUSLY FILED AS       
                EXHIBIT 10.10 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

      10.11     Property Management Agreement, dated December 12, 2002,     
                between GFS Wellington LLC and Pinnacle Realty Management   
                Company (Exhibits A, B & C only) (PREVIOUSLY FILED AS       
                EXHIBIT 10.11 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
                HEREIN BY REFERENCE.)                                       

      10.12*    Reinvestment Plan (INCLUDED AS EXHIBIT A TO THE PROSPECTUS.)

      10.13*    Amended and Restated Escrow Agreement between Boston Private
                Bank & Trust Company and the Registrant (PREVIOUSLY FILED AS
                EXHIBIT 10.13 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON APRIL 9, 2004 AND INCORPORATED     
                HEREIN BY REFERENCE.)                                       

      10.14     Property Management Agreement, dated May 21, 2003, between  
                BC-Bainbridge Bay Pointe LLC and Bainbridge Management      
                Jacksonville LLC (Exhibits A-H) (PREVIOUSLY FILED AS        
                EXHIBIT 10.14 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 (EXHIBITS A-G-1  
                FILED ON APRIL 9, 2004) AND INCORPORATED HEREIN BY          
                REFERENCE.)                                                 

      10.15     Property Management Agreement, dated May 21, 2003, between  
                BC-Bainbridge Timuquana LLC and Bainbridge Management       
                Jacksonville LLC (Exhibits A-H) (PREVIOUSLY FILED AS        
                EXHIBIT 10.15 TO THE REGISTRATION STATEMENT ON FORM S-11    
                (FILE NO. 333-108426) ON DECEMBER 22, 2003 (EXHIBITS A-G-1  
                FILED ON APRIL 9, 2004) AND INCORPORATED HEREIN BY          
                REFERENCE.)                                                 

      10.16     Property Management Agreement, dated May 29, 2003, between  
                BC-Bainbridge Spicewood LLC and Bainbridge Management       
                Jacksonville LLC (PREVIOUSLY FILED AS EXHIBIT 10.16 TO THE  
                REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
                DECEMBER 22, 2003 AND INCORPORATED HEREIN BY REFERENCE.)    

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NUMBER                         DESCRIPTION OF DOCUMENT                   
------       ------------------------------------------------------------
                                                                         
      10.17  Property Management Agreement, dated May 29, 2003, between  
             BC-GFS Settler's Point LLC and American Management Services 
             Northwest, LLC, dba Pinnacle (PREVIOUSLY FILED AS           
             EXHIBIT 10.17 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
             HEREIN BY REFERENCE.)                                       

      10.18  Property Management Agreement, dated May 29, 2003, between  
             BC-GFS Bridge Creek LLC and American Management Services    
             Northwest, LLC, dba Pinnacle (PREVIOUSLY FILED AS           
             EXHIBIT 10.18 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
             HEREIN BY REFERENCE.)                                       

      10.19  Property Management Agreement, dated May 29, 2003, between  
             BC-GFS Boulder Creek LLC and American Management Services   
             Northwest, LLC, dba Pinnacle (PREVIOUSLY FILED AS           
             EXHIBIT 10.19 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
             HEREIN BY REFERENCE.)                                       

      10.20  Agreement for Sale and Purchase of Property (Bay Pointe     
             Apartments), dated February 11, 2003, between Vestcor-Bay   
             Pointe Partners, Ltd. and Bainbridge Communities Acquisition
             Corporation II, as amended and assigned to BC-Bainbridge Bay
             Pointe LLC (PREVIOUSLY FILED AS EXHIBIT 10.20 TO THE        
             REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON
             DECEMBER 22, 2003 AND INCORPORATED HEREIN BY REFERENCE.)    

      10.21  Agreement for Sale and Purchase of Property (Oaks at        
             Timuquana Apartments), dated February 11, 2003, between     
             VCP-Timuquana Associates, Ltd. and Bainbridge Communities   
             Acquisition Corporation II, as amended and assigned to      
             BC-Bainbridge Timuquana LLC (PREVIOUSLY FILED AS            
             EXHIBIT 10.21 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
             HEREIN BY REFERENCE.)                                       

      10.22  Real Estate Sale Agreement, dated April 2, 2003, between ERP
             Operating Limited Partnership and Bainbridge Communities    
             Acquisition Corporation II, as amended and assigned to      
             BC-Bainbridge Spicewood LLC (PREVIOUSLY FILED AS            
             EXHIBIT 10.22 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON DECEMBER 22, 2003 AND INCORPORATED 
             HEREIN BY REFERENCE.)                                       

      10.23  Real Estate Sale Agreement, dated March 27, 2003, among     
             EQR-FANCAP 2000A Limited Partnership, EQR-Bridgecreek       
             Vistas, Inc. and Goodman Financial Services, Inc. (with     
             respect to Boulder Creek and Bridge Creek), as amended      
             (PREVIOUSLY FILED AS EXHIBIT 10.23 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 FILE NO. 333-108426) ON APRIL 9, 2004
             AND INCORPORATED HEREIN BY REFERENCE.)                      

      10.24  Assignment of Real Estate Sale Agreement, dated May 2, 2003,
             from Goodman Financial Services, Inc. to BC-GFS II LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.24 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.25  Real Estate Sale Agreement, dated March 26, 2003, between   
             ERP Operating Limited Partnership and Goodman Financial     
             Services, Inc. (with respect to Settler's Point), as amended
             (PREVIOUSLY FILED AS EXHIBIT 10.25 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.26  Assignment of Real Estate Sale Agreement, dated May 2, 2003,
             from Goodman Financial Services, Inc. to BC-GFS II LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.26 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.27  Assignment of Real Estate Sale Agreement, dated May 21,     
             2003, from BC-GFS II LLC to BC-GFS Boulder Creek LLC        
             (PREVIOUSLY FILED AS EXHIBIT 10.27 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

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NUMBER                         DESCRIPTION OF DOCUMENT                   
------       ------------------------------------------------------------
                                                                         
      10.28  Assignment of Real Estate Sale Agreement, dated May 21,     
             2003, from BC-GFS II LLC to BC-GFS Bridge Creek LLC         
             (PREVIOUSLY FILED AS EXHIBIT 10.28 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.29  Assignment of Real Estate Sale Agreement, dated May 21,     
             2003, from BC-GFS II LLC to BC-GFS Settler's Point LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.29 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 33-108426) ON APRIL 9, 2004
             AND INCORPORATED HEREIN BY REFERENCE.)                      

      10.30  Washington Portfolio Real Estate Agreement, dated July 11,  
             2002, among ERP Operating Limited Partnership, EQR-Alderwood
             Limited Partnership, EQR-Wellington, L.L.C.; and Goodman    
             Financial Services, Inc., as amended (PREVIOUSLY FILED AS   
             EXHIBIT 10.30 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON APRIL 9, 2004 AND INCORPORATED     
             HEREIN BY REFERENCE.)                                       

      10.31  Assignment of Real Estate Sale Agreement to BC-GFS LLC      
             (PREVIOUSLY FILED AS EXHIBIT 10.31 TO THE REGISTRATION      
             STATEMENT ON FORM S-11 (FILE NO. 333-108426) ON APRIL 9,    
             2004 AND INCORPORATED HEREIN BY REFERENCE.)                 

      10.32  Assignment of Real Estate Sale Agreement with respect to    
             Alderwood from BC-GFS LLC to GFS Alderwood LLC (PREVIOUSLY  
             FILED AS EXHIBIT 10.32 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.33  Assignment of Real Estate Sale Agreement with respect to    
             Ridgetop from BC-GFS LLC to GFS Ridgetop LLC (PREVIOUSLY    
             FILED AS EXHIBIT 10.33 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.34  Assignment of Real Estate Sale Agreement with respect to    
             Wellington from BC-GFS LLC to GFS Wellington LLC (PREVIOUSLY
             FILED AS EXHIBIT 10.34 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 9, 2004 AND        
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.35  Letter dated March 11, 2005 requesting the extension of the 
             maturity date of Loan Agreement dated as of May 31, 2003,   
             between BCP Funding, LLC and the Registrant (PREVIOUSLY     
             FILED AS EXHIBIT 10.35 TO THE REGISTRATION STATEMENT ON     
             FORM S-11 (FILE NO. 333-108426) ON APRIL 26, 2005 AND       
             INCORPORATED HEREIN BY REFERENCE.)                          

      10.36  Letter dated March 11, 2005 extending the maturity date of  
             Loan Agreement dated as of May 31, 2003, between BCP        
             Funding, LLC and the Registrant (PREVIOUSLY FILED AS        
             EXHIBIT 10.36 TO THE REGISTRATION STATEMENT ON FORM S-11    
             (FILE NO. 333-108426) ON APRIL 26, 2005 AND INCORPORATED    
             HEREIN BY REFERENCE.)                                       

      10.37  Letter dated December 5, 2005 extending the maturity date of
             Loan Agreement dated as of May 31, 2003, between BCP        
             Funding, LLC and the Registrant (PREVIOUSLY FILED AS        
             EXHIBIT 10.37 TO POST-EFFECTIVE AMENDMENT NO. 2 TO THE      
             REGISTRATION STATEMENT ON FORM S-11 (FILE NO. 333-108426)   
             ON DECEMBER 7, 2005 AND INCORPORATED HEREIN BY REFERENCE.)  

      10.38  Property Management Agreement for Preston at Willow Bend    
             Apartments, Plano, Texas, dated September 15, 2005, by and  
             between BC Broadstone Preston, LP and Alliance Residential, 
             LLC (PREVIOUSLY FILED AS EXHIBIT 10.1 TO THE CURRENT REPORT 
             ON FORM 8-K FILED ON SEPTEMBER 21, 2005, AND INCORPORATED   
             HEREIN BY REFERENCE.)                                       

      10.39  Loan Agreement, dated September 15, 2005, between and among 
             Wachovia Bank, National Association and ALLTX, LLC          
             (PREVIOUSLY FILED AS EXHIBIT 10.2 TO THE CURRENT REPORT ON  
             FORM 8-K FILED ON SEPTEMBER 21, 2005, AND INCORPORATED      
             HEREIN BY REFERENCE.)                                       

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NUMBER                         DESCRIPTION OF DOCUMENT                   
------       ------------------------------------------------------------
                                                                         
      10.40  Loan Extension Agreement, dated as of December 28, 2005,    
             between Wachovia Bank, National Association and ALLTX, LLC  
             (PREVIOUSLY FILED AS EXHIBIT 10.1 TO THE CURRENT REPORT ON  
             FORM 8-K FILED ON JANUARY 3, 2006, AND INCORPORATED HEREIN  
             BY REFERENCE.)                                              

      10.41  Form of Indemnification Agreement entered into by the       
             Registrant with each of its directors (PREVIOUSLY FILED AS  
             EXHIBIT 10.1 TO THE CURRENT REPORT ON FORM 8-K FILED ON     
             FEBRUARY 3, 2006, AND INCORPORATED HEREIN BY REFERENCE.)    

      23.1*  Consent of Reznick Group, P.C.                              

      23.2*  Consent of Ernst & Young LLP                                

      23.3*  Consent of Goodwin Procter LLP (included in Exhibit 5.1)    

      23.4*  Consent of Goodwin Procter LLP (included in Exhibit 8.1)    

      23.5   Consent of National Council of Real Estate Investment       
             Fiduciaries (INCLUDED IN EXHIBIT 23.5 TO POST-EFFECTIVE     
             AMENDMENT NO. 2 TO THE REGISTRATION STATEMENT ON FORM S-11  
             (FILE NO. 333-108426) ON DECEMBER 7, 2005 AND INCORPORATED  
             HEREIN BY REFERENCE.)                                       

      24.1   Power of Attorney (PREVIOUSLY FILED AS EXHIBIT 24.1 TO      
             POST-EFFECTIVE AMENDMENT NO. 2 TO THE REGISTRATION STATEMENT
             ON FORM S-11 (FILE NO. 333-108426) ON DECEMBER 7, 2005 AND  
             INCORPORATED HEREIN BY REFERENCE.)                          

      99     Table VI: Acquisition of Properties by Programs (PREVIOUSLY 
             FILED AS EXHIBIT 99 TO THE REGISTRATION STATEMENT ON        
             FORM S-11 (FILE NO. 333-108426) INITIALLY FILED ON JUNE 16, 
             2005 AND INCORPORATED HEREIN BY REFERENCE.)                 

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

*   Filed herewith.                                                             

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